    [Senate Hearing 107-325]
    [From the U.S. Government Publishing Office]

                                               S. Hrg. 107-325, Pt. 1 deg.

    DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE JUDICIARY, AND RELATED
                  AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2002

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

                                    HEARINGS

                                    before a

                              SUBCOMMITTEE OF THE

                COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE

                          ONE HUNDRED SEVENTH CONGRESS

                                 FIRST SESSION

                                       on

                               H.R. 2500/S. 1215

    AN ACT MAKING APPROPRIATIONS FOR THE DEPARTMENTS OF COMMERCE, JUSTICE,
      AND STATE, THE JUDICIARY, AND RELATED AGENCIES FOR THE FISCAL YEAR
               ENDING SEPTEMBER 30, 2002, AND FOR OTHER PURPOSES

                                   __________

                             Part 1 (Pages 1-811)

                            Department of Commerce
                             Department of Justice
                              Department of State
                       Federal Communications Commission
                           Nondepartmental witnesses
                       Securities and Exchange Commission
                         Small Business Administration
                                 The judiciary

                                   __________

             Printed for the use of the Committee on Appropriations

     Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                     senate

                                     ______

                       U.S. GOVERNMENT PRINTING OFFICE
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                        COMMITTEE ON APPROPRIATIONS \1\

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

       Subcommittee on Commerce, Justice, and State, the Judiciary, and
                                Related Agencies

                      JUDD GREGG, New Hampshire, Chairman
    TED STEVENS, Alaska                  ERNEST F. HOLLINGS, South Carolina
    PETE V. DOMENICI, New Mexico         DANIEL K. INOUYE, Hawaii
    MITCH McCONNELL, Kentucky            BARBARA A. MIKULSKI, Maryland
    KAY BAILEY HUTCHISON, Texas          PATRICK J. LEAHY, Vermont
    BEN NIGHTHORSE CAMPBELL, Colorado    HERB KOHL, Wisconsin
                                         PATTY MURRAY, Washington
                                         ROBERT C. BYRD, West Virginia
                                           (ex officio)

                               Professional Staff
                                  Jim Morhard
                                 Kevin Linskey
                                   Dana Quam
                                  Luke Nachbar
                              Katherine Hennessey
                             Lila Helms (Minority)
                          Jill Shapiro Long (Minority)

                             Administrative Support

                                 Nancy Olkewicz

        \1\ Committee and subcommittee memberships--January 25, 2001 to
    June 6, 2001.

        Note.--From January 3 to January 20, 2001 the Democrats held the
    majority, thanks to the deciding vote of outgoing Democratic Vice
    President Al Gore. Senator Thomas A. Daschle became majority leader at
    that time. Starting January 20, 2001, the incoming Republican Vice
    President Richard Cheney held the deciding vote, giving the majority to
    the Republicans. Senator Trent Lott resumed his position as majority
    leader. On May 24, 2001, Senator James Jeffords of Vermont announced
    his switch from Republican to Independent status, effective June 6,
    2001. Jeffords announced that he would caucus with the Democrats,
    changing control of the evenly divided Senate from the Republicans to
    the Democrats. Senator Thomas A. Daschle became majority leader once
    again on June 6, 2001.

                        COMMITTEE ON APPROPRIATIONS \2\

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

       Subcommittee on Commerce, Justice, and State, the Judiciary, and
                                Related Agencies

                       ERNEST F. HOLLINGS, South Carolina
    DANIEL K. INOUYE, Hawaii             JUDD GREGG, New Hampshire
    BARBARA A. MIKULSKI, Maryland        TED STEVENS, Alaska
    PATRICK J. LEAHY, Vermont            PETE V. DOMENICI, New Mexico
    ROBERT C. BYRD, West Virginia        MITCH McCONNELL, Kentucky
      (ex officio)                       KAY BAILEY HUTCHISON, Texas
                                         BEN NIGHTHORSE CAMPBELL, Colorado

                               Professional Staff
                                   Lila Helms
                               Jill Shapiro Long
                                  Luke Nachbar
                             Jim Morhard (Minority)
                            Kevin Linskey (Minority)
                         Katherine Hennessey (Minority)

        \2\ Committee and subcommittee memberships--June 6, 2001 to July
    10, 2001. Senate committee and subcommittee assignments reverted to
    that which had been in existence at the conclusion of the 106th
    Congress.

        Note.--From January 3 to January 20, 2001 the Democrats held the
    majority, thanks to the deciding vote of outgoing Democratic Vice
    President Al Gore. Senator Thomas A. Daschle became majority leader at
    that time. Starting January 20, 2001, the incoming Republican Vice
    President Richard Cheney held the deciding vote, giving the majority to
    the Republicans. Senator Trent Lott resumed his position as majority
    leader. On May 24, 2001, Senator James Jeffords of Vermont announced
    his switch from Republican to Independent status, effective June 6,
    2001. Jeffords announced that he would caucus with the Democrats,
    changing control of the evenly divided Senate from the Republicans to
    the Democrats. Senator Thomas A. Daschle became majority leader once
    again on June 6, 2001.

                                C O N T E N T S

                                  ----------

                            Thursday, April 26, 2001

                                                                       Page
    Department of Justice: Office of the Attorney General............     1

                              Tuesday, May 1, 2001

    Department of Commerce: Office of the Secretary..................    81

                             Thursday, May 3, 2001

    Department of State: Secretary of State..........................   115

                             Tuesday, May 15, 2001

    Department of Commerce: National Oceanic and Atmospheric
      Administration.................................................   153
    Small Business Administration....................................   229

                             Thursday, May 17, 2001

    Department of Justice:
        Federal Bureau of Investigation..............................   241
        Immigration and Naturalization Service.......................   269
        Drug Enforcement Administration..............................   277

                            Thursday, June 28, 2001

    Federal Communications Commission................................   315
    Securities and Exchange Commission...............................   345
    Departmental witnesses:
        The judiciary................................................   353
    Nondepartmental witnesses:
        Department of Commerce.......................................   379
        Department of Justice........................................   422
        Department of State..........................................   454
        Related agencies.............................................   460

    DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE JUDICIARY, AND RELATED
                  AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2002

                                  ----------

                            THURSDAY, APRIL 26, 2001

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 10 a.m., in room SD-192, Dirksen
    Senate Office Building, Hon. Judd Gregg (chairman) presiding.
        Present: Senators Gregg, Domenici, Hollings, and Inouye.

                             DEPARTMENT OF JUSTICE

                         Office of the Attorney General

    STATEMENT OF HON. JOHN ASHCROFT, ATTORNEY GENERAL

                                opening remarks

        Senator Gregg. We will begin the hearing.
        We appreciate the Attorney General's promptness in
    appearing before the committee, which looks forward to hearing
    from the Attorney General.
        I do not know if the ranking member has a statement he
    wishes to make; I would be glad to hear from the Senator from
    South Carolina.
        Senator Hollings. No. Thank you, Mr. Chairman. We welcome
    the Attorney General, and we are glad to proceed with the
    hearing.
        Senator Gregg. I feel the same way. We are here to hear
    you, not you to hear us. So we will be happy to get your
    thoughts, Mr. Attorney General, and then ask some questions.

                  attorney general ashcroft's opening remarks

        Attorney General Ashcroft. Thank you, Chairman Gregg and
    Ranking Member Hollings. It is a pleasure to be with you today.
    It is an honor and a privilege to appear before you to present
    the President's first budget request for the Department of
    Justice.
        For fiscal year 2002, the President's budget seeks $24.6
    billion for the Department, including $20.9 billion in
    discretionary spending authority and $3.7 billion in mandatory
    resources. While the 2002 request maintains the same overall
    amount of spending authority as provided by this subcommittee
    in 2001--less than 1 percent variance--we have managed to
    enhance a number of key efforts, including reducing gun crime,
    stopping violence against women, combatting drugs, and
    guaranteeing civil rights for all Americans.
        This budget includes a general shift in spending from State
    and local law enforcement in order to support our core Federal
    law enforcement mission and to better target assistance to
    areas of greatest need, such as crime in our schools, crimes
    committed with firearms, and violence against women. The
    Community-Oriented Policing Services, or COPS, program is
    continued at a somewhat reduced level, with resources re-
    targeted for school safety, law enforcement technology needs,
    and reducing DNA backlogs.
        The budget includes nearly $1.1 billion in program
    increases to enable the Department to carry out its core
    mission, particularly in the areas of detention and
    incarceration, antiterrorism, cybercrime, and
    counterintelligence. Another $302 million in new funding is
    requested to address key technology initiatives focusing on
    systems integration upgrades and network reliability. Of this
    amount, $225.7 million will be used directly to assist State
    and local law enforcement agencies with technology needs.
        The 2002 budget also focuses on several key areas that
    reflect the priorities of the Bush Administration--gun
    violence, violence against women, and drug crime, all threaten
    to deny the most fundamental right of our citizens, the right
    to their personal safety. The 2002 budget provides $650 million
    in additional funding to help secure this basic right.

                                   gun crime

        There is no question that we need a renewed commitment to
    the vigorous enforcement of existing laws addressing gun crime.
    The recent gun violence on school campuses highlights the need
    for a collaboration among Federal, State, and local law
    enforcement officers to combat juvenile gun crime. I intend to
    intensify enforcement efforts against gun crime.
        The first step toward this goal is our request for $153.8
    million in increased resources to enforce vigorously gun laws
    through increased prosecutions, collaborative approaches to
    crimes committed with firearms, and by ensuring that child
    safety locks are available for every handgun in America.

                                drug enforcement

        To reinvigorate the war on illegal drugs, the 2002 budget
    includes $77.2 million in additional resources. Specifically,
    our budget seeks $58.2 million in enhancements for the Drug
    Enforcement Administration. The request also continues to
    provide $48 million for the Office of Justice Programs to
    assist State and local law enforcement agencies with the costs
    associated with meth cleanup and to aid in meth enforcement.

                                  civil rights

        Through the efforts of the Civil Rights Division, the
    Community Relations Service, the United States Attorneys, the
    Federal Bureau of Investigation and the Office of Justice
    Programs, the Department seeks to protect the civil rights and
    liberties of all Americans. The 2002 budget includes an
    increase of $105.7 million to further these efforts.

                                  immigration

        For immigration-related activities, the 2002 budget
    includes an additional $240 million. Included within this
    amount is $75 million for the INS to add 570 new Border Patrol
    agents in 2002.
        To address chronic space shortages and facility
    deficiencies, the budget also includes $42.7 million for INS
    Border Patrol facility construction. To enhance the resources
    of county prosecutors located on the Southwest border--these
    are State county prosecutors--our 2002 request includes $50
    million in assistance to those individuals to deal with the
    challenges they face.
        The Administration will propose splitting the mission of
    the INS in two, with separate chains of command reporting to a
    single policy official. I support this restructuring. I believe
    its time has come and look forward to working with this
    subcommittee as the proposal moves through the Congress.

                        state and local law enforcement

        The 2002 budget proposal appropriations request provides
    over $4.2 billion for State and local law enforcement grant
    programs. Included within the request are newly-created
    initiatives or enhancements to existing programs to address
    specific crime problems. These proposals include an increase in
    Violence Against Women Act funding of more than 35 percent;
    expansion of the Weed and Seed Program; more drug treatment in
    State prisons; increased assistance for State prosecutors, and
    new gun violence programs.
        Reductions are made primarily in four areas: (1) Byrne
    discretionary grants; (2) the State Criminal Alien Assistance
    Program; (3) the Local Law Enforcement Block Grant Program; and
    (4) State Prison grants.
        This reduction in funding will allow the Department to
    fulfill its core law enforcement responsibilities, and to
    enhance key efforts including reducing gun crime, stopping
    violence against women, combating drugs, and guaranteeing civil
    rights for all Americans.
        Chairman Gregg, Senator Hollings, I have outlined the
    principal focus of the President's 2002 budget request for the
    Department of Justice.
        I hasten to add that I am still learning about many of the
    programs we have under the jurisdiction of the Department of
    Justice. You both have monitored spending in the Department for
    quite some time and are experts in that respect. I have much to
    learn, and I look forward to your advice and counsel.

                               prepared statement

        Thank you. I would be pleased to be responsive to the
    extent that I can, to questions that you might have.
        [The statement follows:]
                      Prepared Statement of John Ashcroft
        Mr. Chairman and Members of the Subcommittee: It is both an honor
    and a pleasure to appear before you this morning to present President
    Bush's first budget request for the Department of Justice. For fiscal
    year 2002, the President's budget seeks $24.65 billion for the
    Department of Justice, including $20.94 billion in discretionary
    spending authority and $3.71 billion in mandatory resources, such as
    fees. This budget seeks to fulfill our basic federal law enforcement
    responsibilities, address emerging technology and critical
    infrastructure needs, and focus on the Administration's priorities of
    reducing gun crime, combating drug use, guaranteeing the rights of all
    Americans, and empowering communities in their continued fight against
    crime.
        While the fiscal year 2002 budget request maintains the same
    overall amount of discretionary spending authority as was provided by
    this Subcommittee in fiscal year 2001, we have managed to enhance a
    number of key areas. The budget includes a general shift in spending
    from state and local law enforcement in order to support our core
    federal law enforcement mission, and better target assistance to areas
    of greatest need, such as crime in our schools, crimes committed with
    firearms, and violence against women. The Community Oriented Policing
    Services (COPS) program is continued at a somewhat reduced level, with
    resources targeted for school safety, law enforcement technology needs,
    and reducing DNA backlogs. The COPS request does not disrupt or affect
    the commitments made to put 100,000 more police on the streets and, in
    fact, goes further by proposing to hire up to an additional 1,500
    School Resource Officers.
                basic law enforcement--the core federal mission
        The budget I present to you today first addresses the basic law
    enforcement responsibilities of the Department of Justice. The mission
    of the Department is clear: to enforce the law and defend the interests
    of the United States according to the law; to provide leadership in
    preventing and controlling crime; to seek just punishment for those
    guilty of unlawful behavior; to administer and enforce the nation's
    immigration laws fairly and effectively; and to ensure fair and
    impartial administration of justice for all Americans. The fiscal year
    2002 budget includes $1.057 billion in program increases to enable the
    Department to carry out its mission, particularly in the areas of
    detention and incarceration, antiterrorism, cybercrime, and
    counterintelligence.
    Increased Detention and Incarceration Capacity
        The number of inmates in the Federal Prison System has more than
    doubled since 1990 as a result of tougher sentencing guidelines,
    mandatory minimum sentences, the abolition of parole, and increased
    federal law enforcement efforts. This surge in the prison population
    continually tests the limits of our detention and incarceration
    capacity. The fiscal year 2002 budget for the Department of Justice
    includes a $949.5 million increase in funding to support the federal
    responsibility of detaining individuals awaiting trial or sentencing in
    federal court, and incarcerating inmates who have been sentenced to
    prison for federal crimes.
        The rapid growth in the federal inmate population is expected to
    continue. Despite the investment of nearly $5 billion for prison
    construction over the past decade, the prison system is currently
    operating at 32 percent over its rated capacity--up from 22 percent at
    the end of 1997. These conditions could jeopardize public safety and
    cannot be ignored. The fiscal year 2002 budget seeks an additional
    $809.27 million for the Bureau of Prisons to reduce overcrowding and
    accommodate future growth. Specifically, $669.97 million is requested
    to fund the construction of three Federal Corrections Institutions and
    four United States Penitentiaries; partial site and planning funds for
    two female facilities and two male facilities; and $139.3 million is
    requested for the activation of the Federal Corrections Institute in
    Petersburg, Virginia, and the United States Penitentiary and work camp
    in Lee County, Virginia; and, the contract confinement costs to meet
    the anticipated increase in the federal prison population.
        To increase the detention capacity and staffing necessary to keep
    pace with the growth in INS enforcement activities, the Department's
    request includes an increase of $74.2 million. Within this amount is
    $42.3 million in new resources to support the staffing, transportation,
    medical, and removal costs associated with the utilization of an
    additional 1,607 detention beds in fiscal year 2002. And, $31.9 million
    in new resources will support detention planning and construction costs
    associated with additional detention bedspace and other improvements at
    INS Service Processing Centers. INS's detention and removal efforts
    will suffer if additional reliable bedspace is not created. In many INS
    districts, contracting for detention space is not a viable option,
    considering the remoteness of the locations in which INS operates.
        The workload of the United States Marshals Service is, in many
    ways, unpredictable in that the Marshals' organization must meet the
    needs of the Judiciary and our investigators and prosecutors. The
    Marshals do not control the number of threats that judges may be
    confronted with, nor the number of prisoners coming into its custody.
    For fiscal year 2002, our request includes $64.4 million in increased
    funding for the United States Marshals Service to cover the medical and
    housing costs associated with an increase of one million jail days for
    Marshals Service detainees held in non-federal facilities; to address
    the anticipated workload increases as a result of the D.C.
    Revitalization Act; for the staffing and equipping of courthouses that
    are new or undergoing significant renovations; and to support the costs
    of increased prisoner movements.
        Also included within the Department's requested increase for
    incarceration and detention is a critically needed $1.65 million for
    the United States Parole Commission to support anticipated workload
    increases associated with its takeover of the District of Columbia's
    parole revocation and supervised release hearing functions, as outlined
    in the D.C. Revitalization Act.
    Counterterrorism, Cybercrime, and Counterintelligence Efforts
        Preventing terrorism, deterring computer crime, and thwarting
    foreign espionage are among the most serious challenges facing law
    enforcement today. The Department of Justice, with the strong support
    and leadership of your Subcommittee, has acted aggressively to prevent,
    mitigate, and investigate acts of terrorism, including the use of
    weapons of mass destruction, and the emerging threat of cybercrime. For
    fiscal year 2002, we are requesting $107.96 million in additional
    funding to support the Department's counterterrorism, cybercrime, and
    counterintelligence efforts.
        The nation's growing dependency on technology systems has resulted
    in a heightened vulnerability of our banking system, critical
    transportation networks, and vital government services, while also
    significantly increasing the incidence and complexity of crime. To
    address the emerging cyber threat, the fiscal year 2002 budget includes
    $33 million in increased resources. Within this amount, $28.14 million
    will support the FBI's counter-encryption capabilities, and the
    development of cyber technologies for the interception and management
    of digital evidence. For the U.S. Attorneys, $2.95 million is included
    to support 24 new positions for the prosecution of crimes committed
    using the Internet. And, $1.9 million is included for the Criminal
    Division for 14 new positions to continue coordinating the rising
    number of investigations and prosecutions of multi-jurisdictional
    national and international intrusion; denial of service attacks and
    virus cases; and to provide increased network security and encryption
    capabilities for its automated infrastructure.
        To combat the threat of terrorism, the fiscal year 2002 budget
    includes $39.4 million in new funding. For the FBI, $32 million is
    requested for security and investigative duties at the 2002 Winter
    Olympics in Salt Lake City, Utah; for increased security requirements
    at various FBI locations; and, to support its incident response
    readiness responsibilities. In addition, recognizing the critical role
    state and local public safety agencies have in managing the
    consequences of any terrorist event involving weapons of mass
    destruction, the Department's budget request includes $220.5 million to
    continue the Office of Justice Programs' Counterterrorism programs in
    fiscal year 2002 and ensure state and local response readiness. For the
    INS, $6.59 million in new funding is included to establish intelligence
    units along our northern and southern borders. These units will monitor
    terrorist activities and smuggling operations, and assist in tracking
    the movement of illicit narcotics, weapons, and other contraband across
    our nation's borders.
        The Department's fiscal year 2002 budget also requests $31.6
    million in additional funding to allow the FBI to more completely and
    effectively assess and defeat foreign intelligence threats to our
    national security. Included within this amount is funding for the
    Criminal Division to continue assisting the FBI with investigations
    involving counterintelligence, particularly those involving espionage
    and high technology export violations.
                  technology and critical infrastructure needs
        Coordination between federal, state, tribal, and local law
    enforcement agencies is crucial to crime solving and criminal
    apprehension. The pooling of information and resources can greatly
    increase efficiency and decrease the time involved in solving a case.
    Because law enforcement agencies have developed a reliance on one
    another for accurate and timely information, our crime fighting
    agencies must maintain up-to-date information systems and develop
    secure processes for sharing this information. The fiscal year 2002
    budget request includes $302 million in new funding to address these
    needs, focusing on systems integration, upgrades, network reliability,
    efficient processes, and state-of-the-art technologies. In addition,
    the Department plans to request the use of $67 million from its Working
    Capital Fund for infrastructure needs.
        For the FBI, our budget request includes $67.7 million to support
    the second year of Trilogy, the FBI's 3-year information technology
    upgrade plan. Another $6.5 million will permit the acquisition of
    communication circuits that will support faster transmission of data
    and greater network reliability. For activation of the new FBI
    Laboratory in Quantico, Virginia, we are seeking $1.16 million in
    direct spending and the use of up to $40 million from the Department's
    Working Capital Fund. To continue the critically needed integration of
    the INS and FBI Fingerprint Identification Systems, we are seeking $28
    million $1 million in direct spending and the use of up to $27 million
    from the Working Capital Fund. This funding will be used to improve INS
    fingerprinting capabilities, and integrate the INS Automated Biometrics
    Identification System (IDENT) with the FBI's Integrated Automated
    Fingerprint Identification System (IAFIS). This investment of resources
    will better equip us to prevent a recurrence of an incident similar to
    the Rafael Resendiz-Ramirez serial killings that occurred in 1999.
        To directly assist state and local law enforcement agencies with
    their technology needs, the fiscal year 2002 budget includes an
    increase of $225.7 million in grant funding. Specifically, the
    Department is requesting $20.7 million for Crime Identification
    Technology Act (CITA) funding; $35 million to address the backlog of
    state convicted offender DNA and crime scene DNA samples that exist
    nationwide; $35 million for the Crime Lab Improvement Program (CLIP) to
    improve the general forensic science capabilities of laboratories; $35
    million for the Criminal Records Upgrade Program to promote
    compatibility among criminal history, criminal justice, and
    identification record systems nationwide; and $100 million for
    technology grants for state and local law enforcement under the COPS
    program. The fiscal year 2002 budget significantly increases the
    funding available to state and local law enforcement for technology
    initiatives a natural follow-on to the COPS program that provided
    additional officers on the street. Now we need to ensure state and
    local law enforcement is adequately equipped with the best technology
    to do its job.
                         bush administration priorities
        The budget I present to you today also focuses on several key areas
    that are reflective of the priorities of the Bush Administration.
    During my confirmation hearings, I said I believe a citizen's paramount
    civil right is safety. Americans have a right to be secure in their
    persons, homes and communities. Gun violence, violence against women,
    drug crime, and sexual predators all threaten to deny this most
    fundamental right. It is a core responsibility of government, led by
    the Attorney General and the Department of Justice, cooperating with
    local law enforcement officials, to secure this right. Our fiscal year
    2002 budget provides $650 million in additional funding to advance this
    effort. Children do not learn in schools overrun by neighborhood
    violence. Jobs will not be found in communities where criminals own the
    streets, and no American who now feels threatened should have to move
    to live in a safer neighborhood.
    Reducing Gun Crime
        I announced at the outset of my tenure as Attorney General that one
    of my top priorities would be the formation of a new firearms
    enforcement initiative, along with a task force to develop and
    implement this initiative. This group includes the Bureau of Alcohol,
    Tobacco, and Firearms and various components from within the Department
    of Justice, including the Office of the Attorney General, FBI, Criminal
    Division, Executive Office of United States Attorneys, and others. They
    have been meeting regularly and I look forward to hearing their
    recommendations in the next several weeks.
        There is no question that we need a renewed commitment to the
    vigorous enforcement of existing laws addressing gun crime. The recent
    spate of gun violence on school campuses and the alarming rate at which
    gang related violence occurs in schools, on playgrounds, and at parks
    throughout the country highlight the need for federal prosecutors to
    work with state and local law enforcement to pursue serious juvenile
    offenders. I intend to renew enforcement efforts in this area by
    building on successes in existing jurisdictions and by developing a
    comprehensive strategy to target gun violence. The fiscal year 2002
    budget request for the Department of Justice takes the first step
    toward this goal and includes $153.78 million in increased resources to
    vigorously enforce gun laws through increased prosecutions, strategic
    approaches to crimes committed with firearms, and ensuring that child
    safety locks are available for every handgun in America.
        For the U.S. Attorneys, $9 million is included to support Project
    Sentry, a new federal-state law enforcement partnership to identify and
    prosecute juveniles who violate state and federal firearms laws and the
    adults who supply them with guns. This funding will be used to hire a
    prosecutor in each of the 94 U.S. Attorneys' Offices around the country
    who will focus on gun crimes involving or affecting juveniles,
    including school-related violence and trafficking firearms to minors.
        Another $20 million will be provided to Project Sentry through the
    COPS program and the Juvenile Justice Title V program. This funding
    establishes safe school task forces across the country that will also
    prosecute and supervise juveniles who carry or use guns illegally, as
    well as the adults who illegally furnish firearms to them.
        Within the Office of Justice Programs, $49.78 million is requested
    for a new gun violence program that will provide grants to encourage
    states to increase the prosecution of gun criminals and assist them by
    providing funding to establish programs that target gun criminals
    through increased arrests and prosecutions and public awareness to
    deter gun crime. This funding will support Project Exile and Project
    Ceasefire type programs that vigorously enforce our gun laws and send a
    clear signal that our culture will not tolerate the illegal use of
    firearms.
        Another $75 million is included for Child Safe, a new program that
    will provide funds to ensure child safety locks are available for every
    handgun in America. The Office of Justice Programs will provide $65
    million annually to state and local governments on a dollar-for-dollar
    matching basis. Locks will be distributed by local municipalities,
    counties, or private organizations. The annual federal matching funds
    will also be available to match private contributions by organizations
    seeking assistance in the goal of providing locks for every handgun in
    America. The remaining $10 million will be spent, annually, on
    administrative costs and advertising, including a national toll-free
    hotline to make sure all parents are aware of the program.
    Combating Drug Use
        The cost of illegal drug use to this nation continues to rise and
    is borne by all Americans through tax dollars for increased law
    enforcement, incarceration, treatment programs, and medical needs.
    Estimates of the total cost exceed $100 billion annually, yet do not
    begin to capture the human costs associated with drug abuse that are
    measured in wasted human capital, and the pain and suffering of many
    American families. The fiscal year 2002 budget for the Department of
    Justice includes $77.2 million in additional resources for law
    enforcement agencies to combat illegal drug use.
        Specifically, our budget requests $58.16 million in enhancements
    for the Drug Enforcement Administration (DEA). Included within this
    amount is $30 million and 3 positions for DEA's global information
    technology and intelligence network, FIREBIRD. This funding will enable
    the DEA to complete its deployment, provide network security, and
    support technology renewal of the system. Another $15 million and 62
    positions are included to provide critical support for DEA's role in
    the interagency Special Operations Division, and DEA's Investigative
    Technology programs, particularly for investigations associated with
    the Southwest Border, Latin America, the Caribbean, Europe, and Asia.
    To meet mission critical requirements within the laboratory services
    program, $13.1 million and 69 positions are also included. This request
    will give DEA sufficient chemist resources to address a growing backlog
    of exhibits, and establish a laboratory equipment base that will better
    support program operations.
        The production and use of methamphetamine (meth) has been on the
    rise over the past few years, and the number of meth laboratories has
    increased dramatically across the country. In 1998 and 1999 combined,
    law enforcement agencies seized meth labs in every state except 3. Meth
    lab enforcement and clean-up efforts are complicated by the presence of
    hazardous materials produced during the manufacturing process. Cleaning
    up these labs is a costly and risky business posing life-threatening
    consequences to our law enforcement officials who come across these
    labs, as well as severe and toxic environmental damage to the
    surrounding area. State and local law enforcement agencies can be
    overwhelmed by the need to confront even one large laboratory. Meth
    dealers and drug organizations have targeted rural communities, places
    where many of the local law enforcement agencies have neither the
    expertise nor the resources to deal with this serious threat. The
    fiscal year 2002 budget continues to provide $48 million for the Office
    of Justice Programs to assist state and local law enforcement agencies
    with the costs associated with meth cleanup and to aid meth
    enforcement.
        While law enforcement is an effective and essential tool in
    combating the violent crime associated with illegal drug use in
    communities throughout our nation, treatment for the individual abuser
    is also important. Our fiscal year 2002 request includes $14 million to
    expand residential substance abuse treatment in federal and state
    prison systems. We have also requested $5 million for the National
    Institute of Justice to expand the Arrestee Drug Abuse Monitoring
    (ADAM) program to 15 additional sites across the country, so that more
    communities will have sound data about the links between drugs and
    crime on which to base their law enforcement policies and offender
    treatment practices.
    Guaranteeing Rights for All Americans
        The Department of Justice has a unique role in guaranteeing the
    rights of all Americans. This role includes promoting the enforcement
    of our nation's civil rights laws and deterring violent crimes against
    women. Through the efforts of the Civil Rights Division, the Community
    Relations Service, the United States Attorneys Offices, the FBI, and
    the Office of Justice Programs, the Department seeks to protect the
    civil rights and liberties guaranteed to all Americans. The fiscal year
    2002 budget includes an increase of $105.7 million to further its role
    in this area.
        Specifically, we have requested a $102.5 million increase in
    Violence Against Women Act programs to support new and existing
    programs. Authorized under the Victims of Trafficking and Violence
    Protection Act of 2000, the budget includes: $15 million for the Safe
    Havens for Children Pilot Grant Program; $40 million for the Legal
    Assistance for Victims Program; $10 million for the Grants to Reduce
    Violent Crimes Against Women on Campus Program; $5 million for a new
    Elder Abuse, Neglect and Exploitation Program; and $7.5 million for
    education and training to end violence against and abuse of women with
    disabilities.
        Our request also includes $1.2 million in funding to support three
    studies by the Office of Justice Programs' Bureau of Justice
    Statistics. The first study will deal with police initiated stops of
    motorists for routine traffic violations. The second study will deal
    with deaths while in law enforcement custody as required under the
    Deaths in Custody Act. The third study will measure victimization of
    the population with disabilities in the United States.
        For the Civil Rights Division, the fiscal year 2002 budget includes
    a $2 million enhancement to address several important initiatives,
    including enforcement of the newly enacted Trafficking Victims
    Protection Act of 2000, which affords expanded protections and services
    for trafficking victims and creates several new federal crimes for
    which the Division is the lead component with respect to enforcement.
    With the fiscal year 2002 allocation, the Division will be able to hire
    additional prosecutors and conduct a community outreach program.
        The fiscal year 2002 funding will also help the Civil Rights
    Division implement the President's New Freedom Initiative to assist
    persons with disabilities, including expanded outreach to America's
    small business sector, improved access to information technologies and
    voting, and swift implementation of the Supreme Court's Olmstead
    decision to provide services to people with disabilities in community-
    based settings. The fiscal year 2002 budget includes funding for new
    attorney hires that will allow the Civil Rights Division to undertake a
    broad voting rights initiative aimed at ensuring voter access and the
    integrity of the voting process. Our fiscal year 2002 budget request
    also includes funding to increase the Division's presence in employer
    and other communities to prevent immigration-related unfair employment
    practices.
    Empowering Communities in their Fight Against Crime
        The active involvement of communities throughout America is a
    critical and necessary resource in our fight against crime. By
    broadening the base of resources available at the local level,
    communities will be better equipped to provide their citizens with the
    tools necessary to ensure a safe environment in which their children
    can grow and learn. Nowhere is this more evident than in the success of
    the Weed and Seed Program where communities work in partnership with
    federal, state, and local law enforcement agencies to target criminals,
    ``weed'' them out of their neighborhoods with swift and certain
    prosecution, and then go to work to take back the houses, schools, and
    recreation centers, that made the communities a safe haven and home to
    so many. President Bush's fiscal year 2002 budget includes a $25
    million increase for the Weed and Seed program building upon an
    initiative that was first started during his father's Administration
    and with the active support of many on this Subcommittee.
        The fiscal year 2002 budget also includes $5 million for the
    development of a faith-based, pre-release pilot program at four federal
    prisons. The pilot will include male and female programs at different
    geographic sites and security levels. This faith-based initiative--
    which will be voluntary and open to inmates of any faith, or no faith
    at all--aims to combat crime and curb recidivism so that ex-offenders
    can remain ex-offenders. Religion and crime are age-old enemies, and a
    growing body of empirical evidence shows the potency of the ``faith
    factor'' to change behavior. This model initiative, with a strong focus
    on one-on-one, post-prison aftercare, will offer moral guidance and a
    caring community to help ex-offenders re-enter society with hope and
    responsibility.
    Improving Immigration Services and Border Enforcement
        The Immigration and Naturalization Service (INS) has two principal
    functions: enforcement and service. Right now, the INS's performance is
    widely criticized. This Administration intends to turn the agency
    around. Restructuring of the INS will be a top priority. The fiscal
    year 2002 budget includes an additional $240.14 million for
    immigration-related activities.
        The Bush Administration is committed to building and maintaining an
    immigration services system that ensures integrity, provides services
    accurately and in a timely manner, and emphasizes a culture of respect.
    The fiscal year 2002 budget includes $45 million in increased resources
    to reduce the backlogs in benefits processing. This request, combined
    with $35 million in base funding and $20 million in premium processing
    fees, represents the first $100 million installment in a five-year,
    $500 million initiative to provide quality service to all legal
    immigrants, citizens, businesses, and other INS customers. It will
    enable INS to establish and accomplish a universal six-month processing
    standard for all immigration applications and petitions and, through
    employee performance incentives, make customer satisfaction a high
    priority.
        The fiscal year 2002 budget also includes $75 million for the INS
    to add 570 new Border Patrol agents in 2002, with plans to add another
    570 in 2003. With these 1,140 additional agents, the total increase of
    5,000 Border Patrol agents authorized by the Illegal Immigration Reform
    and Immigrant Responsibility Act of 1996 (IIRIRA) will be achieved.
    Approximately 11,000 agents will be deployed along the nation's
    northern and southern borders by the end of 2003, 11 percent more than
    the 2001 level of 9,800.
        In support of the additional agents, another $20 million is
    requested in fiscal year 2002 for the INS to increase the deployment of
    force multiplying border enforcement technology. The Integrated
    Surveillance Intelligence System (ISIS) will provide day and night
    visual coverage of the border, can be deployed in rugged terrain and in
    vast open areas, and serves as a deterrent to potential illegal border
    crossers in areas where Border Patrol agents are not immediately
    visible.
        To address chronic space shortages and facility deficiencies, the
    fiscal year 2002 budget includes $42.73 million for INS Border Patrol
    facility construction. Many of the Border Patrol facilities were built
    prior to the 1970's and cannot accommodate the tremendous growth in the
    number of agents.
        For the Executive Office of Immigration Review (EOIR), the fiscal
    year 2002 budget includes $4.85 million in increased funding to
    coordinate with INS initiatives, which are anticipated to increase
    annually the Immigration Judge caseload and the Board of Immigration
    Appeals caseload by 10,000 cases. The budget also includes an
    additional $1.2 million for the U.S. Attorneys to meet immigration
    workload generated from a rise in habeas corpus petitions filed by
    detainees held in INS custody indefinitely. These detainees have been
    issued an order of deportation but cannot be removed because their
    country of origin will not accept them. Many detainees challenge the
    legal authority of the INS to hold them by petitioning for a writ of
    habeas corpus. Another $1.36 million is requested for the Office of the
    Inspector General to address corruption and civil rights violations
    involving Department employees along the Southwest border.
        To enhance the prosecutorial resources of county prosecutors
    located near the Southwest border, our fiscal year 2002 request
    includes $50 million. Thousands of federal drug arrests occurring near
    the Southwest border are referred to county prosecutors because the
    quantity of drugs seized is too small to meet the threshold set by
    local U.S. Attorneys for prosecution. The Department will devote $50
    million to assist counties near the Southwest border with the costs of
    prosecuting and detaining these referrals. Grants will be awarded based
    on Southwest border county caseloads for processing, detaining, and
    prosecuting drug and alien cases referred from federal arrestees.
        The Administration will propose splitting INS into two agencies
    with separate chains of command, but reporting to a single policy
    official in the Department of Justice. I support this restructuring,
    believe its time has come, and look forward to working with the
    Subcommittee as the proposal moves through the Congress.
    Redirection of State and Local Resources
        The fiscal year 2002 budget provides over $4.2 billion for state
    and local law enforcement grant programs. Included within the request
    are newly created initiatives or enhancements to existing programs to
    address specific crime problems. These proposals include: an increase
    in Violence Against Women Act funding of more than 35 percent; an
    expansion of the Weed and Seed program; more funding for drug treatment
    in state prisons; increased assistance for state prosecutors; and new
    anti-gun violence programs.
        Reductions are made primarily in four areas: (1) Byrne
    discretionary grants; (2) the State Criminal Alien Assistance Program;
    (3) the Local Law Enforcement Block Grant Program; and (4) State Prison
    grants. These funding reductions are recommended for programs that have
    fulfilled their original purpose, outlived their authorizations, or are
    less essential to core federal law enforcement functions. This
    redirection in funding will allow the Department to meet many of the
    federal law enforcement agency priorities that I have highlighted for
    you here today.
                                   conclusion
        Chairman Gregg, Senator Hollings, Members of the Subcommittee, I
    have outlined for you today the principal focus of President Bush's
    fiscal year 2002 budget request for the Department of Justice. I am new
    to the job of Attorney General of the United States and am still
    learning about many of the programs we have under our jurisdiction. You
    both have monitored spending by the Department for some time and I look
    forward to your advice and counsel.
        Thank you. I would be pleased to answer any questions you might
    have.

        Senator Gregg. Thank you, Mr. Attorney General. I
    appreciate that statement.
        You have outlined the proposals which you have come forward
    with. Let me ask you for specifics in some areas that we are
    interested in.

                               INS restructuring

        You mentioned that you are going to propose the splitting
    of INS into two operating units; one would be the Washington
    function, and one would be the citizenship function. Maybe you
    could give us a little more explanation as to how you plan to
    structure those.
        Would the enforcement function be set up as an independent
    agency, such as FBI/DEA, or would it be still under the INS
    umbrella?
        Would the enforcement units be housed independently within
    the border, or would they be joined with other agencies that
    serve on the border? And what is the manning structure of the
    enforcement side?
        This committee has authorized and appropriated--I guess we
    do not authorize; well, we do authorize occasionally----
        Senator Hollings. We have to for the FBI; we have never had
    authorization for the FBI.
        Senator Gregg. We have been known to authorize on this
    committee, but we try not to. But we have appropriated for a
    significant number of Border Patrol individuals, enforcement
    agents, and unfortunately, we have not had success in filling
    the complement. So I would be interested to know where we stand
    in that area, too.
        Attorney General Ashcroft. Well, let me begin with the last
    question. For some time, there was great difficulty in INS in
    attracting and developing the personnel to fulfill the charge
    of this committee. We had appropriations for new people that we
    were not attracting.
        I think we are solving that problem. We have made up for
    the backlog of the non-hires of last year, and we have a net
    new force of about 160 people so far this year, so that we are
    on track, and we feel like we are making that recovery.
        That is important. It takes more than mere appropriations;
    it takes actual implementation. That is one of the reasons why
    we are, and the President has, focused on this agency. The news
    about INS has not always been as favorable as it should be and
    could be, and the President has signalled his very deep concern
    by indicating that he wants to divide these functions.
        I do not think it is totally clear yet whether there would
    be a single reporting individual in INS, or whether there would
    be a single reporting individual in the Justice Department,
    outside of INS.
        What is very clear is that the functional separation is
    essential, that people in the enforcement responsibility have
    one mentality, and the people in the service area should have
    another mentality and another approach. The President is
    committed to, I think, achieving this kind of separation of
    function.
        We are working to attract the very best-qualified
    individual to run the Immigration and Naturalization Service.
    It must be an individual of tremendous skill, administrative
    vision, and a capacity to inspire a work force of over 30,000
    individuals.
        In terms of the deployment of the individuals on the
    border, I think there are some ideas, frankly, which come from
    this committee which I think have great value. One is to seek
    to find ways to elevate the amount of communication between the
    enforcement arm of the INS and other enforcement agencies,
    whether it be the DEA or other personnel in the area. So it may
    be that the physical surroundings, locating INS agents who are
    in the enforcement business in proximity to drug enforcement
    officials and other individuals with law enforcement
    responsibilities, would have a way of enhancing or elevating
    our capacity to get our job done well.
        The slate is substantially open on INS. I think the
    President acknowledged when campaigning for office, and has
    reaffirmed that since he has been in office, that this is a
    matter of great priority. We need to and can do a better job,
    and we look forward to doing a better job. And in shaping that,
    I would hope that this committee would be very active in
    helping us get the best structure and personnel.

                            Border Patrol facilities

        Senator Gregg. I know you have not had a chance yet--and I
    understand you are headed down to the border fairly soon--but
    one thing you are going to notice immediately when you arrive
    there is that the facilities situation is a disaster. Because
    we have increased the number of personnel on the border, we use
    old taco stands that should accommodate about 20 or 30 people
    to house many more than that. We have about a $1.5 billion
    backlog in facilities and construction needs at INS, most of it
    border construction needs for housing Border Patrol.
        It is very hard for the Border Patrol to do an effective
    job if they do not have the facilities. I notice that in your
    budget, you are talking about $128 million or something like
    that for new facilities within INS.
        This committee will probably want to find more money for
    facilities. If you have suggestions for where we should take it
    from, we would be happy to listen to them. But I do think that
    facilities--and you are going to sense this fairly quickly--run
    along with personnel. As we have added these personnel, we have
    not had facility reconstruction.
        Senator Hollings.
        Senator Hollings. General, welcome.
        Attorney General Ashcroft. Thank you.
        Senator Hollings. I understand this is your first hearing,
    and while I did not support your nomination, you and I have got
    to work together for the good of the Government.

                               INS reorganization

        Picking up from what the chairman was talking about a
    minute ago up here with the INS, you have got to get somebody
    in there who is really strong. It is not so much just a
    division of INS. I would be hesitant about dividing and
    reorganizing and so on. Rather, I would try to organize what is
    there. It is the biggest backlog--you ask for an answer, and
    you are lucky if you get it 9 to 12 months from now, and that
    kind of thing--and that is not just recently. I have been--and
    the distinguished chairman has been on the committee here for
    years--and this was 5 years ago, 4 years ago, right on through
    the 1990's. We tried our best. We have been putting all the
    money there, but we have not gotten any results.
        And the growth industry in law enforcement ought to be
    watched carefully by you as the Attorney General. I know that
    just about 10 years ago, your budget was $4 billion, and now it
    is $24 billion. Health care costs and law enforcement costs are
    in a race in this land to see which can consume us first.
        But look at the INS very, very carefully, and you will have
    our cooperation. We have been sort of nags, trying to get the
    INS cleaned up as fast as possible. And I cannot see why there
    is all the holdup.
        We have a Border Patrol school in South Carolina, and we
    have put out 3,000 Spanish-speaking agents down at the old Navy
    Yard. We had the facilities, so we put them in there on a crash
    basis, and it has worked extremely well, and they are very
    happy. They have gone down to the border, and three or four
    have already been killed in the line of duty and so on. So that
    part of INS is working, but it is the actual bureaucracy,
    citizenship and immigration, that is backlogged.

                               Tobacco litigation

        I am sure you saw the morning story about tobacco. I know
    you as a very strong-willed person, because I have worked with
    you on the Committee on Commerce on tobacco. I understand that
    a man convinced against his will is of the same opinion still.
    While there were 19 of us on the committee for proceeding and
    voted to proceed on the tobacco case, you were the one
    dissenting vote.
        Is it your opinion that we ought to proceed with the case
    or not proceed with the case?
        Attorney General Ashcroft. Let me clarify my position
    expressed in my vote on the Commerce Committee. That was not an
    opinion expressed on this case. That was expressed on a global
    settlement that would have given the Federal Government and
    State governments, together, a settlement of the case. This
    case was a subsequent filing, I believe.
        My opinion on this case--first of all, this is an ongoing
    matter of litigation. Our budget request on this case is
    exactly the same budget request as was fashioned and submitted
    by Ms. Reno in anticipation of the year 2002. It is identical
    to the budget request which she submitted as well for the year
    2001. It is for $1.8 million to continue the case. It is in
    anticipation, in the event that the needs arise and so on, that
    additional funding would be available to the case in the way
    that it has been in the past.
        There are a number of issues pending in the case. There
    were three aspects of the case that were submitted to the court
    originally. Two of them were dismissed by the court. One of
    those two dismissals is sought to be remedied by the
    Department, and it is the Department's position that it can be
    remedied, and it is now pending decision by the court.
        A decision about the position of the Justice Department in
    terms of any change that would be made in my judgment, would be
    a decision best informed by what the court does with the two
    pending matters before the case now. The decision and the
    position of the Department have remained unchanged in this
    litigation.

                           Tobacco litigation funding

        Senator Hollings. Now, going back to Commerce, that is
    exactly what intrigues me. We woke up one morning in June 3
    years ago, and there was a headline with a figure that I had
    never heard of--$368 billion. And the $368 billion was a
    settlement amount that the tobacco companies, the White House,
    the health communities, and the attorneys general--and you were
    a former attorney general--had all gotten together on.
        Of course, watching that case as it developed, we found
    that Congress did not confirm the settlement--but the State
    attorneys general went forward with the health community, and
    they got $206 billion of that $368 billion in settlement. This
    was separate and apart from three States that preceded them--
    Florida, Texas, and Minnesota--their settlement amounted to
    about $40 billion. So let us say it was $246 billion of the
    $368 billion agreed to and settled and now in the course of
    being distributed.
        That left $122 billion on the table. And I am saying, look,
    I am from the Government, I am a United States Senator, I am up
    here with the Justice Department appropriation, and there is
    $122 billion that the defendant, the companies, have already
    agreed to pay; they just want to know when and how.
        And yes, it has been a struggle to bring that case with
    this particular committee and the full committee, because it
    has been party vote right down the line. I made the motion that
    we proceed with the case, and my Republican colleagues to a man
    voted no, not to proceed.
        So finally, the distinguished chairman and I got together
    on a compromise. As you indicate, it is the same situation as
    last year. Now, when you say it is the same, yes, the former
    Attorney General was ready to bring the case, and they were in
    the process of doing so, and they were using the section of the
    statute whereby they charged the various departments for the
    amounts of money in order to finance it.
        Having said that, again, I just wonder what you think. Are
    you for the case or against the case?
        Attorney General Ashcroft. The Department of Justice is
    proceeding with the case, and I support the Department's
    position. I think that we have made the right kind of request
    and have the same, identical structure which my predecessor had
    asked for in the appropriation, so the capacity to proceed with
    the case exists in the Department in the same way that it would
    have in previous settings and would have in this setting, had
    the election been different.
        Senator Hollings. Well, there is a difference in the
    Department's and your request in the sense that the memo says
    it has been reported that the attorneys working on the case
    want $57.6 million more in order to proceed with the case and
    do not want to charge the various other departments of
    Government. That $57 million is not in there. Do you favor a
    request of more moneys to finance the case, or not?
        Attorney General Ashcroft. The budget submission which we
    have made, we believe is the right approach to preserving the
    appropriate prerogatives of the Department in this matter.

                             Attorney reassignments

        Senator Hollings. Then, I will have to backtrack with
    respect to that $57 million in accordance with your comment
    about the competence of the attorneys. Of course, the former
    Assistant Attorney General said he thought they were very
    competent, but I understand by the headline that you are
    reassigning the attorneys for lack of competence?
        Attorney General Ashcroft. First of all, sir, I have not
    read the newspapers this morning. I have----
        Senator Hollings. That is not your story, then?
        Attorney General Ashcroft. I have not made any indication
    about any reassignment of attorneys. I have not made a decision
    about the case.
        The Department has a position in this case, and I believe
    that if we were to reevaluate that position, it should be based
    upon what the courts do in response to the matters that are
    pending in the court.
        As I indicated earlier, the court has dismissed two counts
    in this case filed by the Federal Government. One effort has
    been sort of reconfigured by the Department and resubmitted. A
    motion to dismiss is pending in that matter.
        I believe that an appropriate time for decisionmaking in
    the case would be upon receiving an understanding of what the
    court's disposition of these motions is.
        Senator Hollings. Well, understand, General, that I am not
    trying to harass you. In fact, I agree with you that there is
    something about their competence that raises question when they
    ask for $57.6 million. Financially, that is a pretty good
    investment--if you can spend $57 million and get back $122
    billion, which is what the companies have already agreed to
    pay. They just want to know when and how.
        But otherwise, to spend $57 million, I cannot imagine 57
    lawyers with $1 million worth of hours in a year. I would go
    and investigate that memo in your own Department, because they
    are incompetent if they think it would cost that much to bring
    the case.
        The records have been made already in the Florida case, the
    Minnesota case, and others. That is the bureaucracy of law
    practice today. You just punch your computer to get
    Interrogatories Numbers 1 through 25, and get the motions and
    depositions for all of these, put out the subpoenas, and go
    over the documents. I can do that in an afternoon myself.
        So to spend $57 million traveling all around the country is
    just trying to bureaucratize a case that has already been made,
    the amount has been agreed to, and all you have to do is fill
    in the blanks.
        So I hope that you proceed with the case. There was some
    difficulty getting the money from the other departments. I do
    not mean to belabor it, but I think that in the Government's
    interest, there is $122 billion already agreed to sitting on
    the table, and I cannot see for the life of me not picking that
    up. And your Department, and you, the Attorney General, want to
    do that, I would imagine.

                             Gun prosecutor program

        Now, General, let me ask you about the community gun
    prosecutors. I note in the budget here where you zeroed out the
    Community Gun Violence Prosecutors but placed in lieu thereof a
    State and Local Gun Prosecutor Program and Southwest Border
    Prosecutor Initiative, with the same amount of money.
        My Republican friends opposed that Clinton program of
    Community Gun Violence Prosecutors, but it looks like you have
    the same thing--am I right or am I wrong? Could you clarify
    that for me, please?
        Attorney General Ashcroft. Well, we do have an emphasis on
    prosecuting gun crime. It is a substantial emphasis, and it
    involves increased resources. It includes a special emphasis on
    juvenile gun crime, and it includes a triggerlock program, and
    it includes special assistance to prosecutors along the
    Southwest border in the amount of $50 million, I believe it is,
    for prosecutors along the Southwest border.
        So there is an array of services and ideas in this budget
    designed, one, to prosecute violent gun crime generally; two,
    to focus on juvenile gun crime; and three, to focus resources
    along the Southwest border where the problems have been
    intense.
        Senator Hollings. The problems have been more so on the
    Southwest border than, say, in downtown New York or California?
        Attorney General Ashcroft. Well, the entire prosecutorial
    load has been great there. There is a proposal for a whole new
    range of judges and so on in the Federal system, which is the
    subject of another debate, with the idea that the courts are
    overloaded there, dealing with these problems along the
    Southwest border.
        INS, for example, has processed more cases in the last 7
    years than they did in the previous 40 years, and that is part
    of this whole situation that we have described where the budget
    of the agency has been doubled in the last 6 years, and we have
    still got these very serious problems, including delays in
    services that should be made to individuals who are relying on
    the agency.
        Senator Hollings. It is not necessary now, but you can
    submit for the committee the number of prosecutors and how that
    is supposed to work, this new program.
        Attorney General Ashcroft. I would be happy to do so.
        Senator Hollings. I would appreciate it.
        [The information follows:]

                             Gun Prosecutor Program

        Project Safe Neighborhoods is a nationwide commitment to
    reduce gun crime in America by networking existing local
    programs that target gun crime and providing those programs
    with additional tools necessary to be successful. To strengthen
    partnerships among Federal, State and local law enforcement and
    prosecutors, the new $49.78 million prosecution assistance
    program will provide grants to encourage States to increase
    prosecution of gun criminals through increased arrests,
    prosecutions and public awareness in order to deter youth gun
    crime. This program will also support gun violence reduction
    programs such as Richmond's Project Exile and Boston's
    Operation Ceasefire, to name a few. The Department is
    developing legislation that will set forth the details of this
    program, as well as that of other gun violence initiatives.
        The differences between this program and last year's
    Community Prosecution Program, which had a $75 million
    ``Community and Local Gun Prosecutor'' hiring component, is
    primarily one of scope. The $75 million Community and Local Gun
    Prosecutor program provides hiring grants to state and local
    jurisdictions to employ new prosecutors to work in partnership
    with communities to prosecute gun law violation cases. The
    discretionary grant program assists jurisdictions in hiring
    community prosecutors for up to 3 years and will require the
    grantee to design a retention plan intended to retain the
    prosecutor for a minimum of 1 year past the end of the grant
    period.
        The $49.78 million Gun Violence Reduction Program will
    encompass a broader range of gun violence reduction strategies
    that could include: (1) hiring and training more judges,
    prosecutors, correctional officers, and probation officers; (2)
    providing training for Federal, State and local law enforcement
    officers and prosecutors on current laws and trends, including
    firearms identification, Federal and State search and seizure
    laws, crime scene and evidence management, and firearms
    trafficking and tracing; (3) implementing public awareness
    campaigns to advertise tough sentences for gun crimes and to
    foster community ownership of this initiative; (4) improving
    criminal history record information systems; and (5) developing
    information-sharing case management systems that ensure that
    all segments of the criminal justice system are contributing to
    and using the same case files for serious offenders.

                              Faith-based program

        Senator Hollings. Finally, let me counsel with you with
    respect to the faith-based program. That immediately raises a
    sign to stop, look, and listen for this particular Senator. You
    and I have been up here as Senators, and we travel, and if we
    learn anything in our travels, looking at other countries,
    keeping up with the news and so forth, it is that the greatness
    of this land is the separation of church and state. This is in
    contrast to the trouble in Ireland, which is religion-based,
    the trouble in the Mideast, which is religion-based, the
    trouble in India, which is religion-based, the trouble in the
    Philippines is religion-based. I can go around the world and
    just say thank heaven we have separation of church and state in
    this country.
        I do not go along with this Mickey Mouse wording of
    things--in other words, you are saying church organizations.
    Now, you and I both have the greatest respect for the church
    and its organizations, and we have worked with them, both of
    us, in public life and so on, and they work well.
        Having been on the committee, I can tell you the
    experiences that we have when Chairman Gregg and I go over on
    the House side. The first thing the House wants to do is knock
    out everything that is not authorized. That is one good way to
    get rid of a lot because the Judiciary Committee upon which you
    served gets backed up on issues of guns and abortion and prayer
    in schools and so on--and the authorizing bills do not get
    through, so Chairman Gregg and I sit there, trying to backstop
    the real needs and do the right thing.
        This faith-based program has not been authorized, and we do
    not know exactly how it is to be done. That is why I held up a
    reprogramming request by the White House. It is not that I am
    hostile or anything else, but I have grave misgivings. I have
    got to be convinced--I am from Missouri--you have got to show
    me. So I would like you to show me how you plan to implement
    this program and give us also an outline of those particular
    facets of this faith-based thing.
        We have had the announcement by the President and meetings
    of different church groups, but there have been all kinds of
    questions as to is this a legitimate church group, how much
    money, how is it to be monitored. Then, on the church side,
    they say, wait a minute, if you start monitoring me and telling
    me from Washington how to run my church program, I am not going
    along with that. So you have got to involve just what you and I
    are trying to avoid.
        So if you could outline that for us--I am not in favor of
    these moneys until we get at least some outline of what is
    intended by the President and what the program entails.
        Attorney General Ashcroft. Senator, thank you very much.
        The House and Senate together with the previous President
    of the United States authorized, I believe, on several
    occasions, both in the Temporary Assistance to Needy Families
    and in the Substance Abuse and Mental Health Services
    Administration--SAMHSA--reauthorization last year, and I think
    the Community Development Block Grants, what they would
    characterize as, I think, a field-leveling situation, which
    basically states that there are certain aspects when States
    choose to do business outside their own governmental entity,
    that they have the opportunity to make contracts with entities
    including--there would not be a disqualification for faith-
    based organizations.

                      safeguards with Faith-based programs

        There is a very serious set of safeguards, and they have to
    be scrupulously observed, or the problems that you have
    suggested, I think, are very serious problems or could be. One
    of the safeguards included in the legislation is that no
    person, who has simply any discomfort in receiving a benefit in
    that setting, is forced to receive it. They have a right to
    say, ``I want a benefit in a different setting.''
        Another safeguard is that the money cannot be used for
    religious purposes. It can only be used to achieve secular
    purposes. This is in accordance with the supervision--the way
    the courts have written these rules.
        Now, we have had faith-based organizations active for a
    long time in some areas of social services, primarily in the
    resettlement areas related to INS and citizenship. Those areas
    have had historic involvement, and it has been successful, and
    we have not had any inappropriate entanglement or inappropriate
    infringement of the rights of individuals or entanglement by
    the Government with the institutions. I think those are the
    kinds of patterns that need to guide us as we move forward.
        Senator Hollings. Give us the guidance as we move forward.
    That is what I am asking for. Just outline the different things
    that you seem to understand and know about, just quickly off-
    the-cuff. If we have it down in black and white so that
    everybody can understand it, I would appreciate it.
        Attorney General Ashcroft. I would be happy to work with
    you and to do that, to send you the guidance and the safeguards
    that we believe are appropriate.
        Senator Hollings. Thank you.
        [The information follows:]
                             Faith-based Initiative
        In a comprehensive effort to reform the nation's welfare system, in
    1996 Congress overwhelmingly passed, and President Clinton signed, the
    Personal Responsibility and Work Opportunity Reconciliation Act. One
    provision of that Act, known as ``Charitable Choice'' (42 U.S.C.
    Section 604a), authorized states to provide services through religious
    and charitable organizations, so long as such programs do not violate
    the establishment clause of the Constitution. This provision was passed
    with a bipartisan majority, voting 67-32. Since then, Charitable Choice
    has been extended to the welfare-to-work program, and it also covers
    the Community Services Block Grant.
        In 2000, Congress voted twice to extend Charitable Choice to
    substance abuse services provided under the federal Substance Abuse and
    Mental Health Services Administration (SAMHSA). Expanded Charitable
    Choice allows, but does not require, government or government officials
    to contract with charitable, religious or private organizations, or to
    create voucher systems, to deliver more social services within the
    states. Charitable Choice has passed Congress repeatedly, and always
    with strong bipartisan support.
        The Charitable Choice provision prohibits proselytizing of welfare
    clients, and bars any discrimination against clients on the basis of
    religion. Further, welfare recipients have the right to receive
    benefits in a traditional setting, if they choose.
        During the week of January 28, 2001, the Bush Administration
    announced a further effort to expand the role of faith-based
    organizations (FBOs) and other neighborhood organizations in the
    delivery of social services. This effort included the opening of the
    White House Office of Faith-Based & Community Initiatives, and charging
    it with, among other things, increasing the private charitable giving
    in America, eliminating religious discrimination in federal funding
    programs that deliver social services through private sector
    organizations, and helping launch strong sacred-secular, public-private
    partnerships to serve high-need populations. This effort further
    includes the creation within the Departments of Justice, HHS, HUD,
    Education and Labor of Centers of Faith-Based & Community Initiatives.
    Each is charged with the task of reviewing statutes, regulations,
    internal guidelines and policies to determine whether the Departments
    have created barriers that discriminate against faith-based and
    community organizations in the delivery of social services.
        In drafting the legislation noted above, Congress carefully debated
    assurances to its constitutionality as well as to safeguard the
    interests of the beneficiaries of the service, the interests of the
    faith-based providers and the interests of the government. Charitable
    choice provisions protect the rights of those Americans receiving
    services from faith-based providers by the following means:
      --The statute generally provides that the government act ``without
            diminishing the religious freedom of beneficiaries of
            assistance.''
      --The statute requires that beneficiaries with religious objections
            to receiving services from an FBO be provided with an
            equivalent alternative.
      --For those beneficiaries who choose services from an FBO, the
            statute provides that the FBO cannot discriminate against them
            ``on the basis of religion, a religious belief, or refusal to
            actively participate in a religious practice.'' Therefore, a
            Christian organization cannot turn away a Jew who is looking
            for services, or require a Muslim to pray to Jesus before
            receiving assistance.
      --Welfare beneficiaries may enforce these rights against the
            government in a lawsuit for injunctive relief.
        Charitable Choice protects various public interests with the
    following safeguards:
      --FBOs must operate in accordance with the terms of their contract or
            grant when delivering services to the poor and needy.
      --FBOs may not discriminate in employment on the basis of race,
            color, national origin, gender, age or disability.
      --FBOs are subject to government audit of those accounts with federal
            funds. Where total federal awards exceed $300,000 per year, an
            independent audit by a CPA is also required.
      --Where there is direct government funding, FBOs must ensure that no
            government funds are ``expended for sectarian worship,
            instruction, or proselytization.'' This provision means that
            Charitable Choice will not work for FBOs with inherently
            religious practices which are wholly integrated into their
            program. Any religious activities, separable from government-
            funded aspects of the program, must be optional to
            beneficiaries.
        Charitable choice provisions safeguard the integrity of
    participating FBOs in the following specific respects:
      --The statute specifically provides that FBOs not be discriminated
            against with respect to religion, and that they must be allowed
            to participate ``without impairing [their] religious
            character.'' The law goes on to state that a participating FBO
            ``shall retain its independence over the definition,
            development, practice, and expression of its religious
            beliefs.''
      --The statute provides that a participating FBO not be required to
            ``alter its form of internal governance'' or ``remove religious
            art, icons, scripture, or other symbols.''
      --FBOs have a private cause of action for injunctive relief if the
            foregoing statutory safeguards are not met by the participating
            governmental agencies.
        In summary, Charitable Choice safeguards the rights of those who
    receive the social services, those who pay for the services, and those
    who provide the services.

                           Law enforcement in Mexico

        Senator Hollings. Finally, Mr. Chairman, with respect to an
    opportunity, we have worked with the FBI and their schools, one
    in particular in Budapest that I have visited. We look upon
    Mexico as an opportunity with a new President, and we are
    thinking about law enforcement rather than what you have had to
    put up with in regard to the Border Patrol, where the Mexican
    law enforcement were paid off and were part of the drug cartel
    and so on. If we could get a professional school in Mexico that
    was conducted by our FBI--we do that in Europe, in Budapest,
    but particularly this newly-made Russian or Soviet law
    enforcement--why not try to professionalize that? That would be
    a good investment. It would not be too much, and it would help
    to bring confidence on both sides.
        Would you look into that, because I am determined to try to
    get some aid down there--not an overall big Marshall Plan--but
    where we can help Vicente Fox play catch-up ball and get real
    law enforcement. It would be to our benefit, and I think it
    would be a good investment. I would like to get your views on
    that.
        Attorney General Ashcroft. Senator, let me just say to you
    that I think we do have an opportunity as it relates to Mexico.
    President Vicente Fox and our President have a good
    relationship. I think there is a very serious commitment to
    changing the climate for law enforcement.
        President Bush has asked that Secretary of State Colin
    Powell and I be involved in a working group with the leadership
    in Mexico, with Castaneda and with Aguilar Zinser. Aguilar
    Zinser is in charge of all their law enforcement including the
    military, and we have already begun to confer about things.
        There is a new understanding, I believe, in Mexico that
    what happens at the border is--I think they are willing to call
    it a shared responsibility. It had been long the position of
    those in our neighboring country that it was all our
    responsibility and none of their's. And we have conferred about
    inventorying the kinds of things that each of us can do to
    promote a better situation at the border.
        I personally believe that this is a great opportunity. I
    believe we would be very ill-served not to view it as one, and
    I intend to insert myself substantially in it. My first trip
    outside the country will be to Mexico, probably within the next
    30 days. I intend to visit the border in advance so that I will
    have a first-hand view of things at the border before I go to
    return the visit of the Mexican officials. The Mexican Attorney
    General has also come to see me in addition to the other
    officials who have discussed these responsibilities--because
    this is so very important to the United States, and if we can
    upgrade substantially the outcomes of our relationships and
    work together on the border, I think it will not only affect
    that long, important Southwest border of the United States, but
    I think it will have an effect into Central and South America
    in terms of our relationships.
        So you are, I believe, right on target in identifying this
    as an important area of concern. It will be a matter of high
    priority with me in terms of the law enforcement community to
    cooperate with them. We would examine ways in which we could
    cooperate to improve both the training and integrity of the law
    enforcement community on both sides of the border. I think the
    Mexican officials are conversant with that need and understand
    it, and their expression of their desire to cooperate on it is
    right in line with the kinds of suggestions you have made.
        Senator Hollings. Thank you, Mr. Chairman.
        Senator Gregg. Thank you, Senator Hollings.
        Senator Domenici.
        Senator Domenici. Thank you, Mr. Chairman.
        Senator Hollings. I hope to get invited back. He just said
    no, he was not going to invite me. You are a much better
    chairman.
        Senator Gregg. Just remember that.
        Senator Domenici. The problem is they sent all the
    conferees who were against it. There were 15 Democrats for it;
    if they had sent some of those conferees----
        Senator Hollings. We could change our minds.
        Senator Gregg. Let us just conference it right here. We
    have the votes. We are all on the committee. We can conference
    it right here.
        Senator Domenici. Well, the story in New Mexico is that I
    kicked you out, Fritz.
        Senator Gregg. I did not even make it, so you did better
    than I did.
        Senator Domenici. You were not even invited.
        Well, Mr. Attorney General, I am very pleased to see you.
        Attorney General Ashcroft. I am honored.
        Senator Domenici. I have not seen you in this format since
    you achieved this new, high status; I have just seen you in the
    hall a couple of times and at a couple of events. First, I
    congratulate you on the good job you are doing. You went
    through a little bit of hard times to get there, but I am sure
    that you are enjoying what you are doing and that you see a
    great public service in what you are doing.
        Attorney General Ashcroft. It is a great honor to work for
    you, for the people of America, and for this committee.
        Senator Domenici. I am just going to talk about two areas
    and perhaps submit some others for questioning, and I will try
    to be quick.

                    Radiation exposure compensation program

        Mr. Attorney General, we have an area of funding for a
    program called the Radiation Exposure Compensation Program.
    That is not to be confused with a subsequent act that was
    passed regarding radiation exposure. This is the old act that
    covered uranium miners and the like. We passed it, and there
    are a number of people out there who are claimants, and there
    are a number who have claims--and I do not know if you are
    aware of this; this is a simple administrative process, these
    were not litigated claims and did not go to court; you all
    managed them--but there are a number of people who, believe it
    or not, have an I.O.U., because the Government did not put
    enough money in the fund even though it created the claims.
        And I guess I have to share with you and to the extent that
    my fellow committee members are interested--it is pretty
    disheartening for people who have waited many years for a
    radiation claim to get settled, and then you create an
    administrative process, and you say they are entitled to it--
    and it is a fixed amount, so it is not $10 million, it is
    $100,000 or whatever the claim is--and then, they get it all
    finished, Mr. Attorney General, and it says the United States
    Government will give you a check for, let us just say $100,000
    is your claim for dying of cancer or whatever, and then, this
    great United States says, ``We do not have the money to pay
    your claim, so we will give you an I.O.U.''
        I do not think anybody wants those I.O.U.'s. I do not think
    they can use them in banks. Essentially, we ought to pay them,
    and I wonder if we have your whole-hearted support to generate
    the funds to pay those claimants under the Radiation Exposure
    Compensation Program that you are managing?
        Attorney General Ashcroft. You do. I am chagrined at the
    way in which people have been dealt with. There have been
    inadequate funds, so people have been given I.O.U. letters, or
    there were times when people were calling and the phone was not
    being answered.
        We have made a request in the budget for some funds, but we
    also support the idea that the Congress has indicated to people
    that they are entitled to this amount of money, and I believe
    the budget is predicated on the presumption that that
    entitlement exists and that those funds simply ought to be
    available to those people.
        Senator Domenici. Well, I thank you, and actually, we are
    looking for $84 million to finish that up, and there is a whole
    new law which you all have supported funding under that will be
    handled in a different way which will indeed be an entitlement
    instead of what we have.

                                 Ports of entry

        Let me move for a moment to an issue that has to do with
    our ports of entry. First, Mr. Attorney General, I know that it
    is not your precise duty, but it comes under your
    jurisdiction--with the new enthusiasm for Mexican-American
    trade and the new President of Mexico being so enthused about
    being a partner instead of a critic, we have to take a look at
    the ports of entry in the Southwest--and mine is a little one
    in New Mexico--but all the way from Florida, Texas, Arizona,
    California. The ports of entry are not in very good shape for
    two great countries to engage in the quantity and quality of
    trade that we are going to be involved in. So I would hope that
    you would make sure that the estimates which have been given to
    your Department that are saying what we ought to do to make all
    of the border States capable of handling the trade so it is not
    backed up for hours, thus negating the enthusiasm for trade, or
    finding other ways to do it.
        I hope you will support the reports which indicate this and
    that you will begin to implement it in your budgets in the
    future. Would you tell the committee that you will look at this
    carefully and discuss it with the President with reference to
    what kind of plan we could put in to get this infrastructure
    done in a reasonable time?
        Attorney General Ashcroft. Yes.

                          Port of entry--Santa Teresa

        Senator Domenici. With reference to my own State, we have a
    port of entry, and I just want to mention it so that you will
    take it back to the office with you. It is a rather new port of
    entry called Santa Teresa. That port is gaining trade and
    traffic just as predicted. It is not in the middle of a city
    where it is all clogged up, and as a consequence, we are
    building a piece at a time, and it is beginning to alleviate a
    lot of traffic and create its own trade area. There is a
    considerable personnel problem there, and I wonder if you would
    have your staff look at it. I will submit some questions that
    will detail for you what we think are some deficiencies in the
    number of personnel at that border crossing for it to do an
    efficient and forthright job.
        So I will give that to you and if you would take a look or
    have your people take a look, I would appreciate it.
        Attorney General Ashcroft. I would be very happy to do so.
        Senator Domenici. Thank you very much, Mr. Chairman.
        Senator Gregg. Thank you, Senator.

              Radiation compensation transfer to Energy Department

        I have often thought that this issue of reimbursement for
    the harm that was caused people as a result of radiation
    activity might be more appropriately in the Energy
    Subcommittee.
        Senator Domenici. Well, it has been in yours, and you have
    more money than the Energy Subcommittee does.
        Senator Gregg. I just thought we could find more in the
    Energy Subcommittee. Don't you think, Senator Hollings?
        Senator Hollings. Yes, it sounds that way to me.
        Senator Domenici. We are trying to relieve you of it. We
    are trying to create an entitlement out of it so you will not
    have to bother with it, Senator; it will just be there.

                reorganization of the Office of Justice Programs

        Senator Gregg. I was wondering, Mr. Attorney General, if
    you could speak to us a little bit about the Office of Justice
    Programs, because we asked for a reorganization of that office
    quite a while ago. The report was supposed to come out in
    December, and then it was supposed to come out at the end of
    March. We still have not received the report. Can you tell us
    what is happening with the Office of Justice Programs?
        Attorney General Ashcroft. First of all, I think the
    expressions of the committee are well-founded. There is a need
    in that office to have good management, and the fact that so
    many people in the office are Presidential appointments has
    from time to time, I think, led to the idea that they do not
    respond to the management of the office and to the Assistant
    Attorney General in the office.
        We are in the process of moving forward with the new
    organizational structure, streamlining and consolidating
    authorities and centralized management, which was directed in
    the fiscal year 1999 Appropriations Act.
        In the fall of the year 2000, OJP began an interagency
    outreach to prepare agency personnel for implementation of the
    new organizational structure. We engaged the resources to
    provide OJP with assistance in projecting the potential work
    load of individual components, and we began to develop the plan
    for reassigning OJP management and administration funds to
    support implementation of the new structure.
        The OJP Assistant Attorney General nominee, Deborah
    Daniels, has been made aware of this reorganization effort. As
    I have been involved in the preliminary personnel decisions for
    all of those programmatic individuals to be appointed by the
    President, I have said eyeball-to-eyeball to them, this is not
    the structure that you can expect. There will be a new
    structure, and the structure is that you will report through
    the Assistant Attorney General in charge of OJP--this is not to
    be thought of as scattered management; this to be focused--and
    that there will be a new plan, and full implementation of the
    plan has been put on hold until the new Assistant Attorney
    General and her management team have an opportunity to be
    involved with it. But it is part and parcel of the way that we
    are staffing and developing the staffing needs for that area,
    and interviewing people with an expectation that the new
    organization will serve the Department and America much more
    effectively.
        Senator Gregg. So when will we get the report?
        Attorney General Ashcroft. Senator, this sort of signals
    the fact that I have been there for less than 90 days. They
    tell me that the plan has been developed and submitted but that
    the implementation of the plan is yet to be fully undertaken.
        I think that what we need to do is make sure that, if it is
    appropriate, we will resubmit what we have considered as the
    submission to the committee, and if you have further advice on
    the implementation, we would be pleased to have it.
        Senator Gregg. We probably should sit down and talk about
    that, or our staff should.

                               Detention trustee

        Are you familiar with the detention trustee issue that we
    have?
        Attorney General Ashcroft. I am somewhat familiar, and if
    you want me to describe my familiarity, I will give you my
    sense of where we are on that.
        Senator Gregg. Well, our concern is that we basically
    created a position without any authority.
        Attorney General Ashcroft. Our view is that the detention,
    the pre-trial detention--if we can call detention things that
    happen while rights are being litigated and incarceration
    things that are the way we hold people after that--in this
    detention responsibility, we have a lot of different agencies,
    whether it is the INS Border Patrol or the USMS or the BOP or
    all of these multiple agencies, and we do not have the space.
    The Federal Government has not had the kind of resources to
    place all these people, so we have been renting space from
    communities and from private providers, and we have found
    ourselves bidding against each other for this space. So that by
    having an uncoordinated approach to detention and the various
    aspects of the Justice Department, we find the USMS bidding up
    the cost for the INS Border Patrol or other entities.
        The idea of having a coordinator, someone to oversee that
    and to put rationality into our process is a good one. It is my
    understanding----
        Senator Gregg. Well, we agree with that. Our concern is
    that because they do not have the funding control, they do not
    have the power to exercise coordination; that as long as the
    funding control stays with BOP or with Marshals, the INS, or
    with whomever, your detention trustee is basically an
    individual who may strive to create continuity and keep costs
    down but has no practical ability to do that because they do
    not control the money.
        Attorney General Ashcroft. Well, we are pursuing the hiring
    of the trustee, and frankly, while the funding control perhaps
    does exist in these other entities, as Attorney General, I
    would expect, to the extent that I could from the perspective
    of the office, to direct that the Bureau of Prisons and a
    variety of other entities that might be involved--you mentioned
    BOP--that they respond constructively to suggestions by the
    detention trustee.
        If there is a need for--and certainly, the absence of
    detail of my understanding here is apparent from my remarks--
    but I would hope that as Attorney General, I would be able to
    instruct cooperation even if we did not have all of the
    framework in place, and obviously, I would be very pleased to
    work with this committee to develop, if necessary on an
    incremental basis, the framework that would provide real teeth
    or a real management capacity for the trustee.
        Senator Gregg. Senator Hollings.
        Senator Hollings. Thank you.

                             reorganization of DEA

        General, as you look at the reorganization of INS, I have
    always thought that if I had your job, the first thing I would
    look at is the reorganization of the DEA, and let me tell you
    why.
        You have a hard time keeping the FBI in-country, because
    they can find crime in downtown Moscow and look here, there,
    and yonder. The DEA--I have been on this committee for 30-some
    years--we burned the poppy fields in Turkey and broke up the
    factories in Marseilles; we went down into Paraguay, back up to
    Colombia, down into Paraguay again, up into Mexico. We have
    chased around and around, and it gets worse and worse and
    worse.
        When Senator Domenici mentioned a port of entry, Senator
    Graham of Florida and I have been working on a bill for regular
    seaports of entry for a year and will probably get the bill
    passed this year. I have, for example, the fourth-largest
    container port in the country, and it was not until recent
    years that I learned that these containers come in, and they
    are owned by Hong Kong, London, mixed ownership, and there is
    no responsibility for them. And when they come across the dock,
    nine out of ten of them are not even looked at. In fact, I have
    my office at the Custom House at the Seaport of Charleston, and
    the DEA has to borrow the local sheriff's dog to do the
    sniffing.
        Now jump fast forward to Amsterdam. They go through a
    regular screener like you and I go through at the airport;
    going out to St. Louis, you have got to go through a screener.
    They have that screening system. We have got to get that at the
    various ports, because if I got into the drug business down in
    Colombia, I would just load up ten containers knowing that nine
    of them would get through--I do not care about the one that
    gets caught.
        That is how the drugs are getting into the country. In
    contrast, we have the DEA down the rivers in Bolivia, shooting
    down planes in Peru, and jumping all around the world. I have
    seen them jumping around the world for 30-some years up here,
    and it just gets worse and worse--and they do not have anybody
    down on 14th Street here in the District; you can go down there
    and get whatever you want.
        So let us get that thing organized so we can get some drug
    enforcement at least in the country. We can find drug abuses
    the world around--we all know it--and we are financing it. The
    United States is the biggest financier of drug crime in the
    world. We ought to be ashamed of ourselves, but we ought to
    focus on drug enforcement at home before we run around shooting
    down planes in Bolivia and everywhere else. Where were the CIA,
    for goodness' sake? Come on. This country has gone amok. They
    are not doing a good job right at home plate.
        In addition to the INS, look at the DEA and see what you
    think.
        Attorney General Ashcroft. Thank you, Senator.
        Senator Hollings. Yes, sir.
        Thank you, Mr. Chairman.
        Senator Gregg. Thank you.
        Senator Inouye.
        Senator Inouye. I thank you very much, Mr. Chairman.
        I wanted to come by to greet my former colleague. Welcome,
    sir.
        Attorney General Ashcroft. Thank you very much, Senator.

                               Tobacco litigation

        Senator Inouye. I just want to have some clarification on
    articles that have been occurring recently in our papers. Is
    there a change in policy on our Government's suit against the
    tobacco companies?
        Attorney General Ashcroft. There has been no change in
    policy. The appropriation requested this year is identical to
    the appropriation requested last year and is in fact identical
    to the appropriation submitted by my predecessor, Ms. Reno as
    Attorney General, for this year's operation.
        Senator Hollings. I think that would clear up a lot of
    misunderstanding that is now found in the Senate, I can assure
    you.

                     consultation on Judicial appointments

        Secondly, on the matter of judicial appointments and the
    word ``consultation,'' how do you interpret this word
    ``consultation''?
        Attorney General Ashcroft. That question has a superficial
    simplicity about it that belies the fact that it is complex.
    But obviously, if you were to ask me what ``consultation''
    means, it means to talk with, communicate with, about
    something. ``To consult'' means to share information.
        Senator Inouye. So it is much more than notifying you after
    it appears in the press.
        Attorney General Ashcroft. I would hope that consultation
    would include timely communication.
        Senator Inouye. I appreciate that, sir.
        Thank you very much.
        Thank you, Mr. Chairman.
        Senator Gregg. Thank you.
        Are there any further questions?
        Senator Hollings. No, thank you.

                         Additional committee questions

        Senator Gregg. We appreciate your time, Mr. Attorney
    General. We look forward to working with you over the next few
    years and expect the relationship to be constructive not only
    from our committee's standpoint but from America's standpoint.
        Thank you very much.
        Attorney General Ashcroft. Thank you very much. I am
    honored to appear before you and look forward to working with
    you.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]
                   Questions Submitted by Senator Judd Gregg
             interagency crime and drug enforcement (icde) account
        Question. Would you please provide a justification for why the
    Interagency Crime and Drug Enforcement funding levels are proportioned
    to the agencies the way they are? Of particular interest is why the
    Federal Bureau of Investigation receives more funding than the Drug
    Enforcement Administration under this account.
        Answer. The current allocation of the Organized Crime Drug
    Enforcement Task Force (OCDETF) funding is a function of budget
    history, rather than a deliberate choice to enhance the funding of one
    agency more than another. Moreover the OCDETF program is a partnership
    among all the participating agencies and each of the OCDETF agencies is
    fully committed to achieving the highest impact possible with their
    available OCDETF resources.
        While the overall funding for the Federal Bureau of Investigation
    (FBI) is slightly larger than that of the Drug Enforcement
    Administration (DEA), $115 million for FBI versus $111 million for DEA,
    DEA receives more funding for direct drug law enforcement in the OCDETF
    budget than does the FBI, $108.8 million versus $102 million. That
    means that DEA receives a larger share of the funding for the direct
    investigative work of the OCDETF program than does the FBI.
        The FBI, however, receives significantly more funding for drug
    intelligence than does the DEA, nearly $11 million more. FBI receives
    $13.3 million while DEA receives only $2.4 million. It is this funding
    which accounts for FBI's greater share of the overall OCDETF budget.
        This funding disparity arose when the funding for the Regional Drug
    Intelligence Squads (RDIS) was moved from the individual agency budgets
    into the OCDETF consolidated budget, the ICDE, in fiscal year 1993. The
    Appropriations Committees believed ``that consolidation of funding for
    the RDIS under this appropriation will help achieve better integration
    of intelligence related to organized crime drug activities.'' (See,
    Conference Committee Report (H. RPT 102-918)).
        At the time of the transfer of RDIS resources into the ICDE
    appropriation, the FBI had significantly greater resources in its
    direct budget dedicated to the RDIS function than did DEA. Thus when
    the transfer of those resources into the OCDETF budget occurred in
    fiscal year 1993, FBI had $11.5 million to transfer into the OCDETF
    (ICDE) Intelligence appropriation and DEA only $2.2 million. That same
    year Congress provided an additional $2 million to the FBI for RDIS
    resources in the ICDE budget, making a total of $13.2 million.
        This same ratio of RDIS resources between the 2 agencies continues
    in the ICDE appropriation. Thus, for fiscal year 2002, the President's
    request includes the following funding:

    ----------------------------------------------------------------------------------------------------------------
                                          Law Enforcement              Intelligence                  Total
                                    --------------------------------------------------------------------------------
                                      Pos.     FTE     Amount    Pos.     FTE     Amount    Pos.     FTE     Amount
    ----------------------------------------------------------------------------------------------------------------
    DEA............................     975     975   $108,887      25      25     $2,499   1,000   1,000   $111,386
    FBI............................     775     775    102,039     137     137     13,397     912     912    115,436
    ----------------------------------------------------------------------------------------------------------------

        Question. Does the Department of Justice believe the current
    distribution to be an optimal allocation of the resources provided?
        Answer. The Anti-Drug Abuse Act of 1988, Public Law 100-690,
    provided the Attorney General with the ability to shift the OCDETF
    resources both geographically and among agencies as the shifting
    patterns and circumstances of drug trafficking required. Congress
    recognized this with specific language when returning OCDETF to a
    single appropriation for fiscal year 1990. Congress explained that the
    single appropriation and reimbursement procedure was intended to:
      --Provide for the flexibility of the Task Forces which is vital to
            success;
      --Permit federal law enforcement resources to be shifted in response
            to changing patterns of organized criminal drug activities;
      --Permit the Attorney General to reallocate resources among the
            organizational components of the Task Forces and between
            regions without undue delay; and
      --Ensure that the Task Forces function as a unit, without the
            competition for resources among the participating agencies that
            would undermine the overall effort.
        The OCDETF Executive Office intends to work with the Justice
    Management Division to develop a staffing model for the allocation of
    resources in future years. The OCDETF Executive Committee will be
    directed to study the current levels of resources allocated within the
    OCDETF program, and make recommendations regarding the optimum capacity
    for those resources.
                                     ______

                Questions Submitted by Senator Pete V. Domenici
                    radiation exposure compensation program
        Question. Mr. Ashcroft, you are aware of my longstanding interest
    in the Radiation Exposure Compensation program, which I authored in
    1990. We established this program more than a decade ago to compensate
    the uranium miners, federal workers, and downwinders who became
    afflicted with painful, debilitating, and often deadly radiation-
    related diseases as a result of their work during the Cold War era.
        Despite our efforts to fully fund this program, it ran out of money
    last May under the prior Administration. Indeed, since last May many
    approved claimants have been receiving nothing more than an IOU from
    the Justice Department. It is simply unconscionable that those who
    sacrificed so much to build are nation's nuclear arsenal would be left
    holding only a government promise.
        Unfortunately, Mr. Ashcroft, this is a problem you inherited from
    your predecessor. However, we now have an excellent opportunity to
    remedy this terrible injustice that has affected many citizens in our
    western states.
        I was very pleased that the Bush Administration included $710
    million it its budget proposal for mandatory funding for the Radiation
    Exposure Compensation Trust Fund. In addition, I hope that you will
    support the legislation proposed by Senator Hatch and me that would
    provided $84 million in emergency supplemental funding for those
    claimants who have already been approved as well as the projected
    number of approved claims for fiscal year 2001.
        Will the Justice Department fully support our efforts to
    expeditiously acquire the necessary funds to pay those IOU's that have
    already been issued as well as those that will be issued for the
    remainder of fiscal year 2001?
        Answer. The Department of Justice shares your frustration that we
    are unable to provide timely compensation payments to deserving
    claimants. Following enactment of the 2000 amendments to RECA, we
    alerted the Appropriations Committees of the need for additional funds
    to implement the amendments, and the need to classify the RECA Trust
    Fund as mandatory, permanent indefinite so that we will always be in a
    position to promptly issue payments to those claimants who qualify.
    Additionally, the President's 2002 budget reflects this
    Administration's desire to ensure that adequate funds are available by
    seeking mandatory funding for the RECA Trust Fund. In light of the
    growing number of claims that have been approved, but are unfunded, we
    stand ready to work with you to acquire the necessary funding
    expeditiously.
        Question. Under your predecessor's tenure, there were concerns
    about the Department's administration of the program. These included
    complaints that the Department would not return phone calls to
    claimants, that information about the program was difficult to obtain,
    and that claims were taking an exceedingly long time to process. Have
    you already taken steps or do you plan to take corrective action so
    that the program can be administered more fairly and efficiently?
        Answer. The Department of Justice is committed to ensure that the
    Program is responsive to claimants. Accordingly, we are troubled by the
    fact that in recent weeks we have been unable to return some phone
    calls promptly. We have tried to answer each inquiry promptly, but the
    high volume has made it impossible to respond promptly to them all,
    despite our very best efforts. In March alone we received more than a
    thousand requests for information. Concurrently, we have received a
    record number of claims. In 1999, we received about 34 claims per
    month. Since then, receipts have increased 10-fold, averaging 340 per
    month in March and April 2001. We are dedicated to providing prompt,
    helpful responses to all inquiries, and are working hard to achieve
    this goal.
        Question. Would you please provide the Subcommittee with updated
    information on the total number of claims approved for payment from the
    Trust Fund since the program was established, the average amount of the
    claims approved, the number of claims denied, and the general reason
    for denial of these claims.
        Answer. Through May 15, 2001, a total of 3,697 claims were
    approved--with an average value of $74,388--and 3,584 claims were
    denied. Claims are denied if one or more of the following eligibility
    criteria are not met: disease, exposure and identification of the
    proper party to file a claim. Downwinder and onsite participant claims
    are most frequently denied for failure to establish a compensable
    disease. Most uranium miner claims are denied because documentation
    does not establish exposure to the requisite amount of radiation.
        Question. For the record, would you please provide the Subcommittee
    with a breakdown of the types of claims approved or disapproved
    (childhood leukemia, other downwinder, onsite participants, or uranium
    miners).
        Answer. Claims approved or denied through May 15, 2001, by type of
    claimant:

    ------------------------------------------------------------------------
                   Type of Claimant                   Approved      Denied
    ------------------------------------------------------------------------
    Childhood Leukemia............................           22           19
    Other Downwinder..............................        1,720        1,256
    On-site Participant...........................          228          745
    Uranium Miner.................................        1,727        1,564
                                                   -------------------------
          Total...................................        3,697        3,584
    ------------------------------------------------------------------------

        Question. Would you please note how many claims have been received,
    approved, and denied since the Fund went bankrupt last May, as well as
    how many claims are currently pending?
        Answer. Fiscal year 2000 Trust Fund availability was exhausted on
    May 9, 2000. Since that time, 2,724 claims have been received, 366
    claims have been approved, 67 claims have been denied and 2,747 claims
    are pending. Of the total approved, we have been able to pay 122
    claims, using funds appropriated for fiscal year 2001. However, fiscal
    year 2001 funds have been exhausted and 244 approved claims remain
    unfunded.
        Question. For my use, would you please provide the same information
    specifically for claims from Mew Mexico, including the total claims
    received, the total claims approved, the total claims denied, and the
    total claims pending?
        Answer. With respect to claims for which the primary claimant
    resides in New Mexico, between May 9, 2000, and May 15, 2001, 232
    claims have been received, 44 claims have been approved and 27 claims
    have been denied, while 260 claims are pending. Of the total approved,
    31 are unfunded.
        Question. How many claims are projected to be filed and processed
    under current law in the upcoming year?
        Answer. In fiscal year 2002, we estimate that 2,350 claims and
    appeals will be filed and 1,563 will be processed under current law.
        Question. The administrative expenses for this program have
    essentially been held to $2 million per year. With the enactment of
    legislation last summer, additional claims are being filed. What is a
    realistic estimate for the anticipated administrative costs for
    implementing the newly expanded program?
        Answer. We have not yet formulated the anticipated administrative
    expenses beyond fiscal year 2002.
        Question. Does the Administration have any long-range estimates as
    to the number of claims that might still be filed under the Radiation
    Exposure Compensation Act under current law?
        Answer. In May 2000, the Congressional Budget Office estimated that
    about 15,600 claims might be filed under S. 1515, The Radiation
    Exposure Compensation Act Amendments of 2000. Since then, over 2,700
    claims have been filed. Thus, about 12,900 claims might still be filed
    over the lifetime of the current law.
        Question. In a March 15 letter I submitted to you, I requested a
    Justice Department town meeting in Grants, New Mexico so that uranium
    miners could have their questions and concerns addressed directly by
    the Administration. Do you intend to hold such a meeting?
        Answer. Yes, we would be happy to hold a town meeting in Grants,
    New Mexico, and intend to do so.
     staffing by immigration and naturalization service personnel at santa
                        teresa, new mexico port-of-entry
        Question. Attorney General Ashcroft, I am encouraged by the current
    Administration's interest in the Southwest border region, and look
    forward to working with the President on border issues.
        The government needs to invest significant resources into the
    Southwest border. For example, in a recent study by the United States
    Customs Service and other federal agencies, nearly $500 million is
    required to improve inadequate infrastructure along the Southwest
    border's port-of-entry.
        Sharing the border with Mexico affords my state certain
    opportunities, but it also creates special challenges as well.
        Immigration issues are among the most important facing New Mexico.
    The costs associated with providing illegal aliens emergency medical
    and criminal justice services imposes significant hardships on the
    states border counties. New Mexico's 3 border counties, Dona Ana, Luna,
    and Hidalgo pay roughly $5 million per year to provide such services.
        Five million dollars per year is a tremendous financial burden,
    particularly considering New Mexico's relative poverty. In 1998, New
    Mexico was ranked forty-eighth among the fifty states in terms of per
    capita income and forty-sixth in median household income. New Mexican
    counties should not be forced to pay for the Federal Government's
    responsibilities.
        The Immigration and Naturalization Service (INS) is tasked with
    processing legal immigration and enforcing immigration laws. The
    agency's performance on both missions has been severely criticized the
    last few years. I appreciate INS' difficult missions and have
    consistently supported the agency, even given increasing scrutiny.
        That said, I am concerned about the agency's attentiveness in
    meeting its goals.
        In an effort to act pro-actively, I sent, then, Acting Commissioner
    of the INS, the Honorable Mary Ann Wyrsch, a letter urging her to add
    seven additional personnel at the Santa Teresa, New Mexico port-of-
    entry on March 26, 2001. A new bypass road is being built in Mexico
    that will likely triple vehicular traffic at that port. I have not
    received any response from the INS on this issue.
        Considering that this road will be completed in May or June 2001,
    when can I expect the additional personnel that I requested for the
    Santa Teresa port-of-entry?
        Answer. We share your concerns regarding the level of service
    provided to the traveling public at the Santa Teresa port-of-entry as
    described in your letter of March 26, 2001. I noted that your concern
    centers on the recent construction of a road that bypasses the Juarez/
    El Paso area and diverts traffic to Santa Teresa, New Mexico. The INS
    monitors workload and staffing levels at all of our ports-of-entry on
    an ongoing basis, and we work closely with other inspection agencies,
    including the United States Customs Service, at our land border ports
    to ensure that we can provide the highest levels of service.
        The INS will monitor the vehicular traffic increases associated
    with the new traffic patterns at Santa Teresa and will assess what
    additional staffing requirement may be called for to address this
    change in traffic patterns. Our experience indicates the vast majority
    of traffic at this location is of a commercial nature; however, we are
    very sensitive to the need to provide adequate immigration inspector
    resources to allow for a full and complete federal inspection process.
    Once the assessment is completed and a staffing level is determined, we
    will provide additional staff as needed at Santa Teresa.
        We appreciate your continued support and shared interest to ensure
    a safe and efficient Southwest border.
      underutilization of the federal law enforcement training center in
                              artesia, new mexico
        Question. The Federal Law Enforcement Training Center in Artesia,
    New Mexico, has been operational for more than a decade. Yet, the
    facility is woefully underutilized. In fact, INS officials have
    cancelled scheduled training classes. My staff has been told the reason
    for the cancellations are budget shortfalls, even though Congress
    consistently increases INS' budget. Please identify these alleged
    budget shortfalls.
        Answer. In fiscal year 2001, INS moved money from Service-wide
    support funds and operating expenses to cover additional overtime to
    control the hot spots along the border adequately. Four million dollars
    was offset by deferral of advanced training class sessions.
        In fiscal year 2001, 32 advanced training classes were scheduled.
    As a result of border priorities shortfall, only 8 of the first and
    second quarter class sessions were conducted and 16 were deferred to
    fiscal year 2002. Eight additional classes for third and fourth
    quarters are scheduled and will be conducted. In summary, of the 32
    advanced training classes, 16 classes are scheduled and will be
    conducted and 16 classes are deferred to fiscal year 2002.
        The breakdown of the 8 advanced training sessions to be conducted
    in third and fourth quarters follows:
        1. One session of On-site Firearms instructor refresher training
    for expired or expiring Sector Firearms Instructor Certifications.
        2. Two sessions of Driver Instructor Training. These are required
    for new detail instructors.
        3. One Physical Training Workshop. These are required for new
    detail instructors.
        4. Four sessions of Journeyman (Senior) Patrol Agent advanced
    training to update experienced agents in new developments in law,
    arrest techniques and other subjects related to field operations.
        Including the 8 classes held in the first and second quarters, the
    total advanced training classes to be conducted in fiscal year 2001 is
    now 16.
        Question. Please explain how something as critical as training our
    nation's law enforcement personnel manages to be cut due to the alleged
    budget shortfalls.
        Answer. The only reason INS deferred this training to fiscal year
    2002 was to ensure sufficient hours of actual patrol of the border. In
    the future, however, we will make advanced training a high priority and
    look to other areas, first, before making any cuts in this category.
                          caseloads in federal courts
        Question. Attorney General Ashcroft, I am pleased to see that the
    Administration continues an initiative that Congress started last year
    to provide additional support for prosecution assistance to the
    Southwest Border states--California, Arizona, New Mexico, and Texas.
        As you must be aware, our border courts are swamped--these four
    districts handle 30 percent of the entire federal criminal caseload
    pertaining to illegal drugs and illegal immigration.
        I understand that the President's budget requests $50 million for
    Southwest Border Prosecution Assistance to assist county and municipal
    governments in our 4 Southwest border states with the costs associated
    with the handling and processing of drug cases referred from federal
    arrests.
        Has the Department developed an overall plan to address these
    resource needs to be sure that the federal system can handle the
    increasing caseload that is generated by our investment in law
    enforcement personnel and equipment?
        Answer. Over the last decade, investigative efforts along the
    Southwest border (SWB) have significantly increased the requirements of
    all law enforcement agencies in the region. We are mindful that
    increased arrests generate more court cases, and in turn, a greater
    need for detention space. Our recent budget requests have emphasized
    resources for the investigative agencies, litigating components, and
    detention.
        Beginning in 1993, the Department of Justice embarked on a
    comprehensive plan to dramatically increase the number of felony
    immigration prosecutions and restore the rule of law along the border.
    One of the first steps taken was to deploy new Border Patrol and INS
    agents to the border under Operation Hold the Line in El Paso and
    Operation Gatekeeper in San Diego. The success of these two initiatives
    has resulted in an unprecedented number of case referrals from various
    investigating agencies both within the Department of Justice and from
    other agencies such as Treasury, Postal Service and others.
        In fiscal year 1997 and 1998, the United States Attorneys' Offices
    located along the SWB received 58 additional attorneys to focus on
    illegal drug and alien smuggling. They also received an increase of 13
    attorneys in the fiscal year 2001 appropriation for the illegal
    immigration activity in that region.
        Since 1995, the United States Marshals Service (USMS) has received
    150 positions from Congress for the SWB and has placed 157 new
    employees into these five SWB districts. The additional positions were
    accomplished through cost saving efforts throughout the Service, such
    as freezing positions and reducing spending, as well as hiring
    detention officers rather than criminal investigators.
        There has been over a 350 percent increase in immigration cases
    filed since the mid-1990's when we focused on securing the Southwest
    border and bringing down crime in the region. We are doing everything
    we can to make this region safe for our citizens.
        Question. For example, our federal court in Las Cruces, New Mexico,
    handles 65 percent of all the federal criminal cases in New Mexico, yet
    there is no full-time sitting judge. It is also in dire need of another
    Assistant U.S. Attorney, more United States Marshals, and more pre-
    trial and administrative personnel. What types of factors will the
    Department use in awarding these funds to the Southwest Border
    jurisdictions to address this backlog?
        Answer. There are many factors which go into the decision to
    allocate additional resources to districts. Both the United States
    Attorneys and United States Marshals Service have a formal allocation
    process that is used to ensure each district is given the same
    consideration for receipt of new resources.
        When an appropriation is enacted and additional resources are
    provided, the United States Attorneys establish a working group to
    begin the allocation process. The Office of Management and Budget
    Subcommittee to the Attorney General's Advisory Committee (AGAC),
    serves as the Chair of the working group. The remaining members of the
    working group are United States Attorneys chosen based on their desire
    to be involved, their expertise in the specific program area being
    increased, and to ensure geographic and district size diversity among
    working group membership.
        The next step in the process is to determine the relevant objective
    criteria to use along with the data on each district. For example, when
    the fiscal year 2001 appropriation provided additional resources for
    immigration, that working group used the following objective criteria
    to augment the specific district information: caseload and time data by
    program from the case management system, average Assistant United
    States Attorney work years per 100,000 population, local/regional
    involvement, previous program related allocations, and border patrol
    increases. Consideration was also given to a variety of relevant
    district-specific factors, including dedicated law enforcement
    resources, statistical information, and the unique circumstances of the
    district, similar to the situation you raise about Las Cruces.
        The working group that considered the allocation of additional
    resources for immigration received in the fiscal year 2001
    appropriation adhered to the report language that limited the resources
    to those districts involved with immigration cases along the Southwest
    Border. I am happy to say that the working group recommended the
    District of New Mexico receive four additional positions for its
    increased immigration workload, using this deliberative process.
        Similarly, the USMS requests positions for the Southwest Border
    based upon increases in workload, new courthouse construction or
    renovation, and when there are position increases for federal judges,
    magistrates, United States Attorneys (USA), INS, FBI or DEA. Any of
    these factors will ultimately affect the USMS workload and its need for
    resources.
        Since 1995, the USMS has received 150 positions from Congress for
    the SWB and has placed 157 new employees into these five SWB districts.
    The additional positions were accomplished through cost saving efforts
    throughout the Service, such as freezing positions and reducing
    spending, as well as hiring detention officers rather than criminal
    investigators.
        While it is true that the Las Cruces caseload is growing, the
    General Services Administration has no construction projects planned
    for Las Cruces through fiscal year 2005. In the meantime, approximately
    1.5 workyears are being expended in Las Cruces by ``visiting judges''
    from outside the district. Deputy U.S. Marshals in Las Cruces are
    supplemented with as many as three deputies daily from Albuquerque. In
    addition, the USMS office in Las Cruces makes extensive use of guards,
    typically five per day, to meet the needs of the court. In fiscal year
    2002, the USMS has requested 6 positions for Albuquerque, as a result
    of previous courthouse construction. If the USMS receives these
    positions, the Marshal from New Mexico will need to reassess the
    situation in Las Cruces and in all likelihood will use a portion of
    these positions for the staffing of Las Cruces, which is the greater
    priority.
        While OJP funds cannot be used for these federal costs, OJP
    resources will be made available to the eligible local jurisdictions to
    enable them to process substantially more federal arrest cases referred
    from the federal authorities. Funds from the Southwest Border
    Prosecution Assistance Initiative will be awarded on a discretionary
    basis to county and municipal governments in Texas, Arizona, New Mexico
    and California for costs associated with the handling and processing of
    drug cases referred from federal arrests. Individual awards will be
    based on a number of factors, including Southwest border county
    caseloads for processing, detaining, and prosecuting drug cases
    referred from federal arrests.
        Question. For what types of activities will county and municipal
    governments be able to do to use these funds? Last year, Congress
    recognized that the needs included additional prosecutors, probation
    officers, court officials, and detention costs. Would these be covered
    under the Department's proposed Southwest Border Prosecution Assistance
    initiative?
        Answer. The Justice Department's 2002 budget proposes to continue a
    program created by Congress to reimburse district attorneys along the
    Southwest border for the costs of processing, detaining, and
    prosecuting drug cases referred from federal arrests. The program
    provides financial assistance to county and municipal governments in
    Texas, New Mexico, Arizona, and California for the costs associated
    with the handling and processing of drug cases referred from federal
    arrests. These funds may be used for hiring and training more
    prosecutors, probation officers, and court officials, court costs,
    detention costs, courtroom technology, administrative expenses, and
    indigent defense costs.
        This program was created in the Fiscal Year 2000 Emergency
    Supplemental Appropriations Act, which provided $12 million to the USA
    for establishment of reimbursable agreements to the counties and
    municipal governments in the five districts along the Southwest border.
    An additional $12 million was provided the USA to reimburse Texas and
    Arizona in fiscal year 2001.
        The budget proposes to expand funding of this local assistance
    program to $50 million in 2002. The funding request in fiscal year 2002
    is contained in the Office of Justice Programs' appropriation
    consistent with its traditional role of funding grants to state and
    local organizations. Funds from the Southwest Border Prosecution
    Assistance Initiative may be used for hiring and training more local
    prosecutors, probation officers, and court officials, court costs,
    detention costs, courtroom technology, administrative expenses, and
    indigent expense costs.
                              mental health courts
        Question. Attorney General Ashcroft, as you are aware, the
    America's Law Enforcement and Mental Health Project Act was enacted
    into law last year. The Act authorizes the creation of Mental Health
    Courts with separate dockets to handle cases involving individuals with
    a mental illness.
        The Act authorized $10 million for fiscal year 2001 and each of the
    next 4 years to implement the ``Mental Health Courts'' program by the
    Office of Justice Programs. The specific thrust of this program is
    simple--to provide an individual with a mental illness and charged with
    a misdemeanor or nonviolent offense the option of out-patient or in-
    patient mental health treatment as an alternative to incarceration.
        Finally, the Department of Justice estimates that 16 percent of all
    inmates in local and state jails suffer from a mental illness and the
    American Jail Association estimates that as many as 700,000 persons
    suffering from a mental illness are jailed each year.
        Do you believe Mental Health Courts can alleviate prison
    overcrowding and create greater judicial economy within our court
    systems?
        Answer. Early evaluations of specialty, problem-solving courts
    (e.g., drug courts and mental health courts) show that these courts may
    be effective in diverting inmates with mental illnesses and co-
    occurring disorders from prison and impact the use of valuable prison
    bed space. However, there are a number of cautionary notes regarding
    the limitation of these evaluations that should be addressed in
    assessing the impact of mental health courts on prison crowding.
        Generally, the mental health courts have several goals including:
    reduce the use of prisons and repeated interaction with the criminal
    justice system, connect or re-connect persons with mental illness with
    needed mental health services, protect public safety, and improve the
    likelihood of offender success with treatment and access to related
    support services (e.g., housing, etc.). The aim of mental health courts
    are to encourage community-based health approaches that would prevent
    persons with mental illness from entering the criminal justice system
    in the first place or reducing their length of involvement in the
    system.
        Given that the mental health court movement is only about 4 years
    old, few evaluative studies have been conducted that address the impact
    of the courts on prison overcrowding. The few evaluations available
    show that mental health courts may be effective in diverting mentally
    ill offenders from prison. For example, the University of Washington
    Phase I assessment of the King County Court Mental Health Court
    included an analysis of detention data for 77 participants over the
    one-year period prior to the formation of the mental health court
    through its first year of operation. Offenders who chose involvement
    with the mental health court: increased the amount of treatment they
    received and showed decreased problems with the criminal justice
    system; increased number of treatment episodes and decreased time in
    detention; on average spent fewer days in detention and decreased the
    rate of new bookings. Some promising results also were found in the
    Anchorage, Alaska Mental Health Court. In the year before offenders
    participated in the mental health court, they spent an average of 18
    days in the hospital and 85 days in prison. During the year they
    participated in the mental health court, the same individual averaged
    three days in the hospital and 16 days in prison--reductions of 83
    percent and 81 percent respectively.
        While a review of some limited research shows that mental health
    courts may be effective in diverting mentally ill offenders from
    prison, evaluations should assess the impact of mental health courts on
    prison crowding, public safety, connecting the mentally ill offender to
    needed community mental health services, and success of treatment.
        Question. What steps are being taken by DOJ to implement
    ``America's Law Enforcement and Mental Health Project Act?''
        Answer. The ``America's Law Enforcement and Mental Health Project''
    was newly authorized in fiscal year 2001. The legislation authorizes an
    appropriation of $10,000,000 for each of fiscal years 2001 through 2004
    to provide grants to establish demonstration mental health courts and
    provide for technical assistance, evaluation, and training. In fiscal
    year 2002, the Department, in making difficult decisions about
    competing priorities, did not request funds specific to mental health
    courts in order to fulfill its mission of supporting core law
    enforcement functions.
        However, the Bureau of Justice Assistance, through its Byrne
    Discretionary Grant Program, has provided funding to two demonstration
    mental health courts in the past. In fiscal year 1999, King County (WA)
    received $150,000 to help implement a mental health court and in fiscal
    year 2001, Jefferson County (AL) received $150,000 to create a mental
    health court. These courts are designed to respond to the problem of
    mentally ill offenders who repeatedly cycle through the criminal
    justice system without receiving needed assistance. Byrne discretionary
    funds will not be available under the current budget proposal for
    fiscal year 2002; however, states can use their Byrne formula funds for
    further demonstration site support and technical assistance.
    Additionally, states and localities involved in Offender Reentry are
    permitted to use these funds for mental health courts if identified as
    a need in the target community.
        Question. What plans does DOJ have to provide assistance to court
    systems seeking to develop and implement a Mental Health Court and does
    DOJ plan to offer continued technical assistance after the
    implementation of a Mental Health Court?
        Answer. To increase knowledge about mental health courts, BJA
    funded the Crime and Justice Research Institute to complete a report
    about four of the nation's first mental health courts. The report,
    Emerging Judicial Strategies for the Mentally Ill in the Criminal
    Caseload, gives an overview of the issues related to mental health
    courts and provides a detailed description of the featured courts.
    Published by BJA in May 2000, the report is currently in its second
    printing. This report will continue to serve as a resource to
    communities interested in the development and implementation of a
    mental health court.
        In fiscal year 2000, through an Interagency Agreement with the
    National Institute of Corrections, BJA provided $100,000 to provide
    technical assistance to states and local communities interested in
    developing or enhancing services to persons with mental health
    disorders involved with the justice system. For over 5 years, BJA has
    provided funding to the National Judicial College to develop judicial
    training programs, including a course and instructional manual on the
    role of the judge in responding to persons with mental health issues.
        States will have the ability to provide further technical
    assistance as well as assistance in court development and
    implementation through their Byrne formula grant funds.
                       law enforcement in indian country
        Question. I am pleased to see that the Administration continues to
    focus on the law enforcement situation in Indian Country, and promotes
    cooperation between the Bureau of Indian Affairs (BIA) and the
    Department of Justice agencies. In fiscal year 2001, this Subcommittee
    provided $106.5 million through various Department of Justice programs
    to enhance law enforcement in Indian Country.
        How much does the Administration propose in its fiscal year 2002
    budget for the Department of Justice to continue these Indian law
    enforcement initiatives?
        The tribal courts have received $18 million over the past three
    years. How have these funds been allocated to tribal courts?
        Answer. The Department of Justice requests continued funding in
    fiscal year 2002 for the grant programs in Indian Country that the
    Congress funded in fiscal year 2001. These grant programs total $93.9
    million. Since fiscal year 1999, the Congress has also provided funds
    for additional agents and prosecutors, which will also continue to be
    funded in the fiscal year 2002 request.
        The Tribal Courts Program provides financial and technical
    assistance for federally-recognized Indian Tribal governments to
    develop, enhance and continue operation of tribal judicial systems;
    provides education and training for tribal court personnel; and
    promotes cooperation and coordination among tribal justice systems and
    federal and state judiciary systems. The Tribal Courts Program
    addresses a need to build and enhance tribal justice involving American
    Indians and Alaska Native populations; to address the increased
    incidences of violence and other criminal offenses occurring in Indian
    Country; and to support the tribes' infrastructure as dependent
    sovereign nations. Beginning in fiscal year 1999, in support of the
    Department of Justice Indian Country Law Enforcement Initiative, the
    Bureau of Justice Assistance (BJA) Tribal Court Program has awarded
    competitive grants to tribes based on the extent and urgency of need of
    each applicant.
        The first solicitation announcement, issued in fiscal year 1999,
    resulted in 77 grant awards to tribal communities. Forty-four tribal
    communities received funding to develop single or inter-tribal court
    systems; thirty-three tribal communities received funding to implement
    enhancement initiatives. Enhancement initiatives were provided to
    tribes to improve case management, train court personnel, acquire
    equipment, enhance advocacy services, establish diversion programs, and
    access services. Reflecting the demand for this program, BJA received
    109 more applications under the first solicitation than it was able to
    fund. In addition, the National Tribal Justice Resource Center, the
    Northern Plains Tribal Judicial Institute, and the Alaska Inter Tribal
    Council received funding to provide training and technical assistance
    to the tribal grantees.
        To facilitate the administration of the program and assist
    recipients, BJA held a series of cluster meetings for new grant
    recipients in June 2000, July 2000, September 2000, October 2000 and
    March 2001. BJA plans to increase technical assistance to tribes in the
    area of judicial administration, advocacy skills, and information
    technology. A formal national evaluation will be initiated to assess
    the impact of increased assistance to tribal communities to plan,
    implement and enhance traditional tribal and western court systems.
        In April 2001, BJA issued a second competitive solicitation
    announcement for the development of tribal courts or the
    implementation, enhancement, and continuing operation of tribal courts.
    Under this competitive solicitation, BJA received 137 concept papers,
    of which 15 concept papers were for planning grants and the remainder
    were for either implementation or enhancement grants. Currently, all
    concept papers are being reviewed by peer panels. BJA anticipates that
    up to 100 tribes will receive awards ranging from $60,000 to $400,000
    based on each tribe's service population. BJA anticipates that more
    tribes will apply for funding in this second round, reflecting an
    increased awareness of the program through conferences and marketing
    efforts. Technical assistance and training will be continued,
    emphasizing on-site consultation, collective training around common
    issues, and mentoring between established and emerging tribal courts.
        Question. Congress approved $34 million in each of 1999, 2000, and
    2001 through the State Prison Grants program to help with the addition
    of detention facilities in Indian Country. How is the Department
    expending these funds? What is the analysis of need for these
    facilities across the nation?
        Answer. Since 1999, $102 million has been appropriated for the
    construction of correctional facilities on tribal lands for the
    incarceration of offenders under tribal jurisdiction. The following
    lists the awards made using funds available in 1999 and 2000:

    Fiscal Year 1999 Funding:
        TIER 1: Congressional Directives:
            Three Affiliated Tribes of Fort Berthold (ND)...      $2,000,000
            Native Village of Barrow (AK)...................       6,000,000
                        --------------------------------------------------------
                        ____________________________________________________
              Subtotal......................................       8,000,000
                        ========================================================
                        ____________________________________________________
        TIER 2: BIA Designated Priorities:
            San Carlos Apache Tribe (AZ)....................       2,158,550
            Confederated Tribes of the Colville Reservation
              (WA)..........................................       4,579,550
                        --------------------------------------------------------
                        ____________________________________________________
              Subtotal......................................       6,738,100
                        ========================================================
                        ____________________________________________________
        TIER 3: CIRCLE Project (correctional components):
            Pueblo of Zuni (NM).............................       2,334,000
            Northern Cheyenne Nation (MT)...................       3,482,629
            Oglala Sioux Tribe (SD).........................       1,327,659
                        --------------------------------------------------------
                        ____________________________________________________
              Subtotal......................................       7,144,288
                        ========================================================
                        ____________________________________________________
        TIER 4: Regional Approaches:
            Rosebud Sioux Tribe (SD)........................       6,100,770
            Shoshone Paiute Tribe (NV)......................       2,862,132
            Red Lake Band of Chippewa (MN)..................         574,870
            Nisqually Indians (WA)..........................         371,473
                        --------------------------------------------------------
                        ____________________________________________________
              Subtotal......................................       9,909,245
                        ========================================================
                        ____________________________________________________
              Fiscal Year 1999 Project Totals...............      31,791,633
                        ========================================================
                        ____________________________________________________
    Fiscal Year 2000 Funding:
        CIRCLE Project Supplements:
            Pueblo of Zuni..................................       2,339,454
            Northern Cheyenne...............................       3,980,909
                        --------------------------------------------------------
                        ____________________________________________________
              Subtotal......................................       6,320,363
                        ========================================================
                        ____________________________________________________
        Tribal Supplemental Awards:
            Fort Peck Assiniboine Sioux.....................         696,588
            Rosebud Sioux Tribes............................       3,168,000
            Shoshone-Paiute Tribes..........................       1,154,536
            Confederated Tribes of Colville.................       2,500,000
            San Carlos Apache...............................       8,628,722
            Red Lake Band of Chippewa.......................       8,841,213
            Hualapai........................................       2,000,000
            Three Affiliated Tribes of Fort Berthold........       1,872,909
                        --------------------------------------------------------
                        ____________________________________________________
              Subtotal......................................      28,861,968
                        ========================================================
                        ____________________________________________________
              Fiscal Year 2000 Project Totals...............      35,182,331

        Additionally, $900,000 was used in 1999 and 2000 to provide
    technical assistance to each of the tribal grantees and to tribes in
    the discovery and planning stages of addressing their offender
    populations through incarceration.
        In 2001, funds will be made available to: existing projects that
    have been funded only through the design phase and are prepared to
    enter the construction phase in 2001; unfunded applications that were
    ranked high in the competitive review process in 1999, but were not
    selected due to limited funding in prior years; the Gila River Indian
    Community, which is prepared to proceed with construction of a 104-bed
    facility in 2001; and per Congressional direction, the Cultural Justice
    Spirit Camp and Healing Center near the Village of Hoonah, Alaska.
        Tribal governments have jurisdiction over misdemeanor crimes
    committed by Indians in Indian Country. Tribal authority to sentence
    offenders is limited to 1 year or less imprisonment (25 U.S.C.A.
    Sec. 1302(7)) for non-felony convictions. Many American Indian
    communities experience significant levels of crime including: violent
    crime, domestic violence, child abuse, aggravated assaults, and violent
    crime strongly correlated with alcohol abuse. The United States
    Attorneys Office is responsible for felony crimes occurring on
    reservations. However, the authority to sentence for up to 1 year for a
    non-felony crime allows tribes to intervene in the early stages of an
    offender's behavior before the criminal activity reaches a level of a
    felony. The sentence of up to 1 year imprisonment for a non-felony
    crime is intended to act as a deterrent from more serious criminal
    activity. Tribal justice systems are the most appropriate institutions
    for maintaining order in tribal communities and are the preferred forum
    for delinquent offenders who commit misdemeanor crimes. As the tribal
    court system is the closest, both physically and culturally, to
    victims, offenders, and their families, tribal courts require access to
    adequate correctional facilities to impose a range of interventions and
    sanctions to impact offender behavior effectively.
        According to the Office of Justice Programs' Bureau of Justice
    Statistics Jails in Indian Country Survey (Survey), 1998 and 1999, of
    the 69 detention facilities in Indian Country, 15 facilities were
    operating above 150 percent capacity on peak day in June 1999, and 11
    facilities were under a court order or consent decree on June 30, 1999.
    Due to consistent overcrowding, restrictions on the maximum number of
    inmates that could be held in custody were placed on these facilities.
    Also according to the Survey, 43 of the 69 facilities reported that
    they are authorized to hold juveniles, however only two-thirds reported
    that juveniles are separated from adults by both sight and sound. Nine
    facilities separated young persons by sight only, and four facilities
    reported that juveniles were not separated from adults.
        With the exception of the most recently constructed facilities, the
    majority of the existing detention facilities are over 25 years old and
    of linear design which makes supervision extremely difficult; they have
    little or no programming space to impact offender behavior; they are
    high security which may be unwarranted and unproductive given the
    characteristics of the offender population; they are in poor condition
    and out of compliance with building codes and Bureau of Indian Affairs
    jail standards; and they do not have the capacity for sight and sound
    separation for juveniles housed in joint adult and juvenile facilities.
    These structural deficiencies impact safety, security, and the
    effectiveness of behavior modification.
        Question. This initiative also provides funding to assist Indian
    tribes and pueblos with the hiring of additional law enforcement
    officers, to purchase equipment, and to train new and existing
    officers. How much has the Department devoted to these activities? What
    is the status of obligating these funds? How has the Department
    implemented this portion of the initiative?
        Answer. In fiscal year 2001, the Department of Justice, Office of
    Community Oriented Policing Services is dedicating $39.9 million to the
    COPS Indian Country grant program. Because these tribal departments
    often have limited resources, the COPS Office sets application
    deadlines later in the fiscal year so that they have ample time to
    complete and submit the grant application packets. In 2001, the
    application deadline for the Tribal Resources Grant Program (TRGP), the
    grant program that funds personnel and equipment, was set for April 16.
    COPS expects to have these applications reviewed and awarded by the end
    of August (it is estimated that these grants will account for
    approximately $32.3 million of the $39.9 million). An additional
    $500,000 is being dedicated for the same purposes as above to the
    Mental Health and Community Safety Initiative, which is a cooperative
    effort among a number of federal agencies to address mental health and
    substance abuse problems of Native American youth. The application
    deadline for this program is June 22, and COPS hopes to be able to make
    awards by August.
        COPS will spend approximately $2 million on the CIRCLE project
    grants and approximately $2 million in waivers in fiscal year 2001. An
    additional $1 million is set aside to be used to provide training and
    technical assistance to tribal law enforcement. These funds are
    expected to be obligated in August or September.
        A portion of the total remaining funds (approximately $2.1 million)
    may be used for additional training and technical assistance efforts,
    however it is anticipated that the funds will be used to fund the new
    Tribal Hiring Renewal Grant Program, which will provide additional
    grant dollars to law enforcement agencies that are experiencing severe
    fiscal distress and will not be able to retain their current COPS
    funded officers without additional federal assistance. These grants
    will be awarded in August or September.
        Question. A total of $35 million was approved for the Office of
    Juvenile Justice and Delinquency Prevention programs for programs to
    combat tribal youth crime. What is the status of this program?
        Answer. The Tribal Youth Program (TYP) was established in 1999 with
    $10 million in fiscal year 1999, $12.5 million in fiscal year 2000, and
    $12.47 million in fiscal year 2001, appropriated to OJP as part of the
    Title V juvenile prevention program. The program is administered by the
    Office of Juvenile Justice and Delinquency Prevention (OJJDP), which
    assists tribal communities and States to prevent and control
    delinquency and improve their juvenile justice systems. Although OJJDP
    has provided discretionary grant funds and training and technical
    assistance to American Indian Tribes in the past, TYP is the first
    OJJDP program dedicated exclusively to prevention, control, and
    juvenile justice system improvement in American Indian communities. TYP
    is part of the Indian Country Law Enforcement Initiative, a program of
    the Departments of Justice and the Interior that is designed to enhance
    Indian Country law enforcement standards and improve the quality of
    life in Indian Country.
        Of the nearly $35 million appropriated to date for TYP, OJJDP has
    allocated $3.5 million to support program-related research, evaluation,
    and statistics; $700,000 to provide training and technical assistance
    to tribal programs; and $25.76 million to fund discretionary grants,
    including a separate TYP mental health grants program. The fiscal year
    2001 TYP solicitation will be available in May 2001. The performance
    plan target for fiscal year 2001 is to fund an additional 35 tribes,
    which will bring the total number of federally recognized tribes and
    corporations representing Alaska Native villages receiving awards to
    116.
        Question. What types of programs does the Department plan to fund
    with these dollars?
        Answer. The types of programs are funded as follows:
    I. Discretionary Grants
        The program announcement for TYP offers a flexible grant program
    designed to meet the unique needs of each American Indian community
    applicant to prevent and control delinquency and improve its juvenile
    justice system. All federally recognized tribes, Alaskan Native
    villages, corporations representing Alaskan Native villages, or
    coalitions of tribes or villages are eligible to apply for a 3-year
    grant. Grants range from $75,000 to $500,000 and are awarded on a
    competitive basis. To ensure a broad distribution of TYP funds, OJJDP
    considers the size of the tribe, geographic location, and whether the
    tribe is in an urban or rural area in making final funding decisions.
        Grant Categories.--Applicants are required to focus on one or more
    of the following categories of program activity. The number of tribes
    with programs in these categories are listed immediately before the
    description.
      --Category I--Reduce, control, and prevent crime and delinquency both
            by and against tribal youth. Elements relevant to this
            objective include community needs assessments, risk factor
            identification, family strengthening, truancy reduction,
            dropout prevention, parenting, anti-gang education, conflict
            resolution, child abuse prevention, gang reduction strategies,
            youth gun violence reduction, and sex offender services.
      --Category II--Interventions for court-involved tribal youth.
            Elements relevant to this objective include graduated
            sanctions, restitution, diversion, home detention, foster and
            shelter care, community service, improved aftercare services,
            mental health services interventions (e.g., crisis
            intervention, screenings, counseling for suicidal behavior),
            and mentoring.
      --Category III--Improvement to tribal juvenile justice systems.
            Elements relevant to this objective include indigenous justice;
            training for juvenile court personnel, including judges and
            prosecutors; intake assessments; model tribal juvenile codes;
            advocacy programs; gender-specific programming; probation
            services; and aftercare programs.
      --Category IV--Prevention programs focusing on alcohol and drugs.
            Elements relevant to this objective include case management,
            drug and alcohol education, drug testing, substance abuse
            counseling for juveniles and families, services for co-
            occurring substance abuse disorders, and training for treatment
            professionals.
    II. Circle Project
        Fiscal Year 1999 Phase I.--TYP provided $200,000 per grantee for
    the Comprehensive Indian Resources for Community and Law Enforcement
    (CIRCLE) project. Funding has been provided to three tribes: Oglala
    Sioux, SD; Northern Cheyenne, MT; and Zuni Pueblo, NM--in coordination
    with the Office of Tribal Justice, Office of Justice Programs, Office
    of Juvenile Justice and Delinquency Prevention, Office for Victims of
    Crime, Violence Against Women Grants Office, Corrections Program
    Office, the Office of Community Oriented Policing Services, United
    States Attorneys, the Bureau of Indian Affairs, and the Federal Bureau
    of Investigation (FBI). These agencies have provided significant
    financial and technical assistance support to the participating tribal
    governments.
        Fiscal Year 2000 Phase II.--TYP provided $200,000 per CIRCLE
    grantee (continuation).
    III. TYP Research and Evaluation Projects
        OJJDP's tribal youth research activities are designed to provide
    empirical evidence about juvenile justice and delinquency prevention
    policies and practices and their impact on tribal youth.
        OJJDP adheres to three principles that serve as the foundation for
    research and evaluation activities. These principles require that
    research and evaluation projects for tribal youth: 1. provide practical
    results that are locally relevant; 2. include local community members
    in the decision-making and implementation of the projects; and 3.
    acknowledge and respect local customs, traditions, values, and history.
        OJJDP's program of research for tribal youth includes the following
    initiatives.
                Participatory Evaluation of the Tribal Youth Program
        TYP provides funds directly to tribal communities to develop
    programs that help prevent and control juvenile delinquency, including
    violent crime, and improve tribal juvenile justice systems. The
    Michigan Public Health Institute (MPHI) in Okemos, MI, in partnership
    with the Native American Institute at Michigan State University in
    Lansing, is helping five tribes evaluate programs developed with their
    TYP funds. Each site is assembling a program assessment team (PAT) that
    will include local stakeholders in developing and carrying out data
    collection, analysis activities, and evaluation reports. MPHI will
    provide training and technical assistance to PATs to facilitate
    evaluations of their tribal programs. MPHI also will analyze each
    site's juvenile and tribal justice systems and TYP activities within
    those systems, and analyze the relationships between the tribal
    government and county, state, and Federal Government agencies as they
    relate to juvenile justice responsibilities and operations.
                Delinquency and Juvenile Justice in One American Indian
                        Nation
        New Mexico State University in Las Cruces is conducting a study
    that uses the unique historical, cultural, social, and legal aspects of
    one tribal nation in the Four Corners area of the southwestern United
    States to look at delinquency and the legal processing of juveniles
    over the past 11 years, taking into account changes in tribal
    resources, such as the opening of a casino on the reservation. The
    project will work with tribal members to develop a model for ongoing
    delinquency research in this and other tribes of the Southwest.
                Culturally Appropriate Juvenile Justice and Delinquency
                        Prevention
        The College of Menominee Nation in Keshena, WI, is working with
    Menominee organizations to develop, demonstrate, and evaluate a
    culturally appropriate, community-based, family-centered approach to
    juvenile justice and delinquency prevention. Researchers are developing
    a needs assessment, an evaluation design, and a delinquency prevention
    and juvenile justice improvement guide for other tribal groups. The
    project focuses on integrating health and social services and helping
    the Menominee Nation and other tribal organizations institutionalize
    this integration process. Service providers will be trained to design,
    implement, and evaluate delinquency prevention programs for tribal
    youth.
                Assessing Gang Activity in the Navajo Nation
        The Navajo Nation Judicial Branch in Window Rock, AZ, is conducting
    the first comprehensive assessment of gang activity by a tribal
    government. The study is using a mixed research design of quantitative
    and qualitative assessments, with close community involvement at all
    stages. Official court data, follow-up surveys, and gang member
    interview protocols have been reviewed for an initial assessment and
    community members are helping researchers understand the nature,
    extent, and causes of Navajo Nation gang violence. Researchers hope to
    discover approaches to dealing with gangs that can be adapted by other
    tribes.
                Youth Gangs in Indian Country: Profiling the Problem and
                        Seeking Solutions
        Building on the Navajo Nation's youth gang study, researchers at
    California State University in Sacramento are using ethnographic
    observation and interviews with community members and gang members to
    document and profile the youth gang experience in up to six rural and
    urban tribal sites across the country. Researchers are interviewing
    professionals who work with gang-involved youth to learn about external
    influences on tribal youth gangs, such as the involvement of off-
    reservation gangs. The project will produce an inventory of policies
    and practices used at the sites to prevent and intervene with youth
    gangs and will examine recommendations made by community members to
    improve present procedures.
                Tribal Youth Field-Initiated Research and Evaluation
        Field-initiated research allows researchers in the field to
    identify the areas and topics they believe need to be examined. The
    tribal youth field-initiated research and evaluation program supports
    projects that address alcohol and substance abuse, child abuse or
    neglect, and indigenous approaches to juvenile justice. OJJDP will
    award 2 grants in September 2001.
                Indian Country Youth Gang Survey
        In 2001, OJJDP's National Youth Gang Center in Tallahassee, FL,
    added an Indian Country supplement to its ongoing annual National Youth
    Gang Survey of law enforcement officials. This component is assessing
    the prevalence, composition, and activities of youth gangs in federally
    recognized tribes that are not traditionally included in the national
    survey. Preliminary results are expected at the end of 2001.
                Longitudinal Study of Tribal Youth Risk and Resiliency
        OJJDP also has developed a research project that will include a
    specific cultural focus to assess the complex relationships among
    culture, community, family, individual youth, and the development of
    delinquency. This study will enhance understanding of risk and
    protective factors that influence delinquency and resiliency within the
    cultural and historical context of tribal youth. The findings will have
    direct implications for prevention activities with at-risk tribal youth
    and intervention activities with juvenile offenders. In addition, the
    study will contribute to the development of effective and culturally
    appropriate research approaches with tribal populations. OJJDP will
    competitively select a grantee in 2001.
    IV. TYP Training and Technical Assistance
        Beginning in fiscal year 1999, OJJDP has awarded a total of
    $700,000 to the American Indian Development Associates (AIDA) to
    provide training and technical assistance (TTA) to tribal grantees to
    facilitate strategic planning, improved tribal juvenile justice
    systems, and implementation of TYP.
        AIDA has successfully completed assessments for policy, program,
    and overall system change which have helped grantees to identify needs,
    problems, gaps, strengths, and solutions. Many tribes have developed
    comprehensive juvenile justice planning and implementation strategies.
    Data collection instruments have been designed using a culturally
    relevant TTA design, which is developed in collaboration with the TYP
    grantees. The provision of services is accomplished through program
    reviews, onsite visits, and telephone consultation and interviews with
    representatives from the tribal administration and key program
    managers.
        Question. What indication is the Department getting as to the
    nature of this problem in Indian Country and the need for resources?
        Answer. Research indicates that American Indians and Alaska Natives
    are at a significantly greater risk of violence than other Americans.
    In addition, American Indians and Alaska Natives experience
    disproportionately high levels of violent victimization, intimate
    partner violence, child abuse and neglect, youth gang involvement, and
    offending while using alcohol. These difficulties are compounded by a
    lack of available resources for families, youth services, and law
    enforcement. Youth growing up under these circumstances are exposed to
    a variety of risk factors that increase their chance of becoming
    involved in delinquency and violent offending.
        The following are examples of some of the latest research reporting
    the extent of crimes against American Indians and Alaska Natives.
      --Estimates from the National Crime Victimization Survey indicate
            that, from 1993 to 1998, American Indians sustained violent
            victimization at the highest per capita rate, a rate higher
            than that of any other race surveyed. (Rennison, Callie,
            Violent Victimization and Race, 1993-1998, Bureau of Justice
            Statistics Special Report, March 2001, NCJ 176354, pg. 1)
      --From 1993 to 1998, the average annual rate of rape or sexual
            assault was higher for American Indian women than that of any
            other race surveyed. (Rennison, Callie, Violent Victimization
            and Race, 1993-1998, Bureau of Justice Statistics Special
            Report, March 2001, NCJ 176354, pg. 2)
      --American Indian women are particularly vulnerable to violent crime,
            reporting a victimization rate nearly twice that of other
            racial groups. (Tjaden, Particia, and Nancy Thoennes, Extent,
            Nature, and Consequences of Intimate Partner Violence, Findings
            from the National Violence Against Women Survey, Washington,
            D.C.: National Institute of Justice, July 2000, NCJ 181867, p.
            25)
      --Seventeen percent of all Native women will be stalked during their
            lifetimes (Tjaden, Patricia, and Nancy Thoennes, Prevalence,
            Stalking in America: Findings From the National Violence
            Against Women Survey, Research in Brief, Washington, D.C.:
            National Institute of Justice, April 1998, NCJ 169592, p. 5)
      --Alcohol and drug use was a factor in more than half of violent
            crimes against American Indians. Overall, in 55 percent of
            American Indian violent victimizations, the victim reported
            that the offender was under the influence of alcohol, drugs or
            both. (Greenfeld, Lawrence, and Steven Smith, American Indians
            and Crime, Washington, D.C., Bureau of Justice Statistics,
            February 1999, NCJ 173386, p. 9)
      --In the United States from 1992 to 1995, American Indians
            experienced an increase in the rate of abuse or neglect of
            children under age 15. (Greenfeld, Lawrence, and Steven Smith,
            American Indians and Crime, Washington, D.C., Bureau of Justice
            Statistics, February 1999, NCJ 173386, p. 15)
      --Arrests of American Indians under age 18 for alcohol-related
            violations are twice the national average. (Greenfeld,
            Lawrence, and Steven Smith, American Indians and Crime,
            Washington, D.C., Bureau of Justice Statistics, February 1999,
            NCJ 173386, p. 25)
      --From 1996 to 1998, the number of Indian inmates in the custody of
            the Bureau of Prisons (BOP) has increased by 21 percent (from
            1,276 to 1,549 inmates). During that same period, the number of
            Indian juveniles in BOP custody has increased 47.5 percent
            (from 103 to 152 juveniles). Furthermore, the number of Indian
            offenders under BOP supervision has increased by 28 percent
            (from 1,347 to 1,732 offenders).
        These statistics reveal the urgent need for additional resources to
    be provided to Indian Tribes in order to improve responses to crime and
    crime-related problems in Indian Country. The Department of Justice
    administers a variety of funding programs that provide such resources
    to Indian Tribes. For fiscal year 2002, the President's budget request
    is designed to help carry out the Federal Government's responsibilities
    to Indian Tribes, including the following resources: $35,191,000 to
    build correctional facilities in Indian Country; $31,315,000 for the
    COPS Tribal Resources Grants Program; $7,982,000 for Tribal courts;
    $4,989,000 for Tribal demonstration projects on alcohol and crime; and
    $1,996,000 for Tribal criminal justice statistics collection.
    Generally, these figures represent a continuation of existing funding
    levels for the programs. The COPS Tribal Resources Grants Program,
    however, is maintained at a higher level than COPS programs generally,
    which reflects a continuing need for these resources and the special
    role of the Federal Government in Indian Country law enforcement.
        Question. Finally, would the Department please provide the
    Subcommittee with a summary of the total funding proposed to be
    allocated under the Indian Law Enforcement initiative in fiscal year
    2002 with the programmatic detail also provided?
        Answer.

           DEPARTMENT OF JUSTICE FISCAL YEAR 2002 PRESIDENT'S BUDGET INDIAN COUNTRY LAW ENFORCEMENT INITIATIVE
    ----------------------------------------------------------------------------------------------------------------
               Component                                           Item                                   Request
    ----------------------------------------------------------------------------------------------------------------
    Office of Justice Programs.....  Tribal Courts Program--to assist tribal government in the            $7,982,000
                                      development, enhancement, and continuing operation of tribal
                                      judicial systems.
                                     Title V Incentive Grants for Local Delinquency Prevention--to        12,473,000
                                      serve Indian youth by developing, enhancing, and supporting
                                      tribal juvenile justice systems.
                                     Indian Alcohol and Substance Abuse Program--for demonstration         4,989,000
                                      grants on alcohol abuse and crime in Indian Country. This will
                                      fund law enforcement activities.
                                     State Correctional Grant Program--for the construction of            35,191,000
                                      detention facilities in Indian country.
                                     Tribal criminal justice statistics collection..................       1,996,000
    Community Oriented Policing      Grants to Tribes for additional law enforcement officers,            31,315,000
     Services.                        equipment, and training.
                                                                                                     ---------------
          TOTAL....................  ...............................................................      93,946,000
    ----------------------------------------------------------------------------------------------------------------

                            first responder training
        Question. Attorney General Ashcroft, I continue to believe that our
    federal law enforcement agencies must push to train as many first
    responders as we can. These are our local law enforcement, fire, and
    emergency medical personnel who are likely to be first on the scene of
    a terrorist attack.
        As the lead agency for counter-terrorism efforts by the Federal
    Government, you are critical to the coordination of our federal efforts
    in this regard. I am most familiar with the Nunn-Lugar-Domenici program
    which is training state and local responders in 120 major cities, and
    the National Domestic Preparedness Consortium headquartered at Fort
    McClellan, Alabama, which is working with training partners to expand
    this effort to other cities and towns.
        The Nunn-Lugar-Domenici program has now been transferred to the
    Department of Justice to complete the training program for 120 major
    cities. Have all 120 cities been put through the Nunn-Lugar-Domenici
    training program?
        If there are a few cities remaining to undergo this training, how
    does the Department propose to complete the Nunn-Lugar-Domenici
    program?
        Answer. On April 6, 2000, President Clinton signed a Decision
    Memorandum transferring authority for the administration of the Nunn-
    Lugar-Domenici (NLD) Domestic Preparedness (DP) Program from the
    Department of Defense (DOD) to the Department of Justice (DOJ),
    effective October 1, 2000. Funding and authority to support this
    transfer was provided in DOJ's fiscal year 2001 appropriation, enacted
    on December 21, 2001. As of September 30, 2000, DOD had completed
    delivery of the entire program to 68 of the 120 targeted cities, and
    initiated, but not completed, delivery to 37 additional cities (cities
    69-105). These cities did not receive their final two program
    exercises, or funding for the procurement of training equipment. Cities
    106-120 had yet to begin the program.
        Following receipt of funding to implement program activities, the
    Office of State and Local Domestic Preparedness Support (OSLDPS)
    secured the services of the previous program management support and
    exercise contractors, and on February 2, 2001, initiated contact with
    those cities for which DOD had started but not completed program
    activities (cities 69-105). A Program Information and Technical
    Assistance Meeting for these cities was held on March 7-8, 2001 to
    formally commence completion of the program. At this meeting cities
    were provided with the grant application for their training equipment,
    initiated the grant application process, and scheduled their exercise
    planning and execution cycle. The first program exercise was held on
    May 15, 2001 in Baton Rouge, Louisiana.
        Additionally, on February 16, 2001, OSLDPS made initial contact
    with the final 15 cities (cities 106-120), which did not begin program
    activities prior to the program's transfer. OSLDPS has received Mayor-
    appointed City Points of Contact from these cities, and is in the
    process of scheduling formal initial meetings with these cities. The
    first such meeting was held on June 6, 2001, in Warren, Michigan. All
    15 initial meetings will be held, and training activities initiated,
    during fiscal year 2001. Under OSLDPS administration, the NLD DP
    Program will combine specialized training assets available only through
    OSLDPS training partners with jurisdiction-specific assessments,
    allowing each of the remaining cities to tailor the program to meet its
    own individual training, exercise, and equipment needs. OJP has
    requested $9.15 million in the fiscal year 2002 President's Budget to
    complete delivery of the program to all 120 cities.
        OSLDPS is actively coordinating the execution of the NLD DP Program
    with the Department of Health and Human Service's (HHS) Metropolitan
    Medical Response System (MMRS) program. OSLDPS and HHS representatives
    will jointly present both program efforts at the initial meetings for
    cities 106-120, and are working to integrate program activities
    effectively along a logical time-line.
        Question. Could you provide the Subcommittee with the Department's
    current assessment of federal efforts to prepare state and local law
    enforcement and emergency personnel to respond to potential terrorist
    attacks?
        Answer. The Office of State and Local Domestic Preparedness Support
    provides federal leadership to the local first responder community in
    counterterrorism training, equipment purchase, technology research and
    development, and technical assistance and evaluation. OSLDPS believes
    that in order to enhance most effectively the capacity of state and
    local agencies to respond to incidents of domestic terrorism, its
    programs should be information-driven, based on specific identified
    requirements at the state and local level, and responsive to state and
    local needs.
        In keeping with this philosophy, OSLDPS has, working with the
    Congress, implemented a program in all 50 states, the District of
    Columbia, and the 5 United States territories to develop comprehensive
    Three-Year Domestic Preparedness Strategies. These strategies are based
    on an integrated suite of threat, risk, and public health assessments,
    conducted at the local level, which identify the specific level of
    response capability necessary for a jurisdiction to respond effectively
    to a WMD terrorist incident. Once these plans are assembled and
    analyzed, they will present a complete picture of equipment, training,
    exercise and technical assistance needs across the nation.
        OSLDPS anticipates receiving the majority of these Strategies by
    December 31, 2001. Following their submission, OSLDPS will work
    directly with each state and territory to develop and implement
    tailored, individual training, exercise, equipment, and technical
    assistance programs to meet the requirements laid out in the Three-Year
    Domestic Preparedness Strategies. This approach represents the most
    aggressive effort to date to tailor federal domestic preparedness
    assistance to the specific needs of state and local jurisdictions.
        In order to coordinate effectively the execution of its programs
    with the preparedness efforts of other federal agencies, OSLDPS has
    established regular and recurring meetings with representatives from
    the United States Fire Administration's (USFA's) National Fire Academy
    (NFA), the Federal Bureau of Investigation (FBI), the Federal Emergency
    Management Agency (FEMA), the Environmental Protection Agency (EPA),
    the Department of Energy (DOE), the Department of Health and Human
    Services (DHHS), the Centers for Disease Control and Prevention (CDC),
    and the National Domestic Preparedness Office (NDPO). The purpose of
    these meetings is to capitalize on the diverse expertise and
    specialized assistance delivered by these agencies through a formal
    process to ensure a unified and coordinated federal training
    preparedness effort. OSLDPS also has on-site representation from the
    National Guard Bureau to coordinate program efforts and provide
    technical assistance and guidance.
        Additionally, in May 2000, at the direction of the Congress, OSLDPS
    conducted the TOPOFF (Top Officials) exercise, the largest federal,
    state and local exercise of its kind, involving three separate
    locations and a multitude of federal, state and local agencies. TOPOFF
    simulated simultaneous chemical, biological and radiological attacks
    around the country and provided valuable lessons for the nation's
    federal, state and local emergency response communities. Currently,
    OSLDPS has begun planning for the Congressionally mandated TOPOFF II
    exercise, to be conducted in fiscal year 2002. TOPOFF II will build
    upon the success of the May 2000 TOPOFF exercise by incorporating
    lessons learned into TOPOFF II planning and design. TOPOFF II will be
    preceded by a series of preparatory WMD seminars and table top
    exercises crafted to explore issues relevant to the exercise.
        Question. How many local law enforcement and fire and medical
    personnel have been trained?
        Answer. As of May 1, 2001, OSLDPS has provided direct training to
    22,113 emergency response personnel in 1,126 jurisdictions throughout
    the country. Of this total, 2,314 received trained via the Metropolitan
    Fire and Emergency Medical Services course to enable them, in turn, to
    provide training to other first responders. OSLDPS estimates that an
    additional 48,970 first responders have been trained by trainers who
    received instruction through the Firefighter/EMS Training Program.
        Of the total of 22,113 emergency response personnel, 17,976 have
    received training via the National Domestic Preparedness Consortium;
    and 1,823 have received training via other OSLDPS training partners
    Pine Bluff Arsenal, National Sheriffs' Association, and International
    Association of Fire Fighters.
        The following table summarizes this information.

            Institution                                          No. Trained

    Students trained at the Center for Domestic Preparedness (CDP)
        (Fort Mcclellan)..........................................     4,653
    Students trained by the Consortium (excluding CDP)............    13,323
                        --------------------------------------------------------------
                        ____________________________________________________

          Subtotal: Students trained by Consortium................    17,976
                        ==============================================================
                        ____________________________________________________
        Trainers trained by Firefighter/EMS Training Program
          (estimate)..............................................     2,314
        Students trained by other OSLDPS training partners........     1,823
                        --------------------------------------------------------------
                        ____________________________________________________

          Total...................................................    22,113

        Question. An important part of readiness is not only the training
    but the equipping of these forces. What has the Federal Government
    achieved with regard to equipping these teams with what they need to
    respond to a variety of potential attacks?
        Answer. The Office for State and Local Domestic Preparedness
    Support (OSLDPS) recognizes the importance of specialized response
    equipment to the state and local first responders who would bear the
    lion's share of the burden in mitigating any terrorist event involving
    a weapon of mass destruction (WMD). The OSLDPS Equipment Grant Program
    was initiated in 1998 to provide funding directly to states and local
    governments to help enable the purchase of the specialized equipment
    necessary for WMD incident response.
        OSLDPS is currently providing funds to all 50 states, the District
    of Columbia, the Commonwealth of Puerto Rico and the United States
    territories for this purpose. With these funds, OSLDPS grantees have
    been able to purchase badly needed personal protective equipment,
    detection, decontamination and interoperable communications equipment
    for their first responders. In addition, these funds allow states to do
    critical assessments of current threats, vulnerabilities, risks,
    capabilities and needs and to develop strategic plans to more
    effectively guide the use of scarce domestic preparedness resources.
    Evidence from the field suggests that the equipment funding OSLDPS has
    provided to date has helped many state and local jurisdictions increase
    their WMD response capabilities significantly. OSLDPS also believes
    that the impact of the assessment and strategy development process will
    be equally profound when completed.
        The following table summarizes funding amounts provided by OSLDPS
    to state and local first responder agencies from the inception of the
    program in 1998 to the present.

               OSLDPS GRANT FUNDING TO STATE AND LOCAL FIRST RESPONDERS: FISCAL YEAR 1998-FISCAL YEAR 2001
                                                [In millions of dollars]
    ----------------------------------------------------------------------------------------------------------------
                                                                                      Fiscal Year--
                                Program                            -------------------------------------------------
                                                                       1998        1999         2000         2001
    ----------------------------------------------------------------------------------------------------------------
    Local Grants..................................................         12         31.7          0            0
    NLD Grants....................................................          0          0            0           15
    State Grants..................................................          0         53.8         72.5         75.7
                                                                   -------------------------------------------------
    Total.........................................................         12         85.5         72.5         90.7
    ----------------------------------------------------------------------------------------------------------------

        Question. What is the Department doing to fully utilize existing
    facilities and expertise in First Responder Training for Weapons of
    Mass Destruction?
        Answer. OSLDPS has specifically designed its first responder
    training program to take full advantage of existing facilities and
    expertise to deliver a robust, comprehensive program of instruction to
    the nation's emergency response community. OSLDPS utilizes the
    capabilities of a number of specialized institutions in the design and
    delivery of its training programs. These include private contractors,
    other federal and state agencies, the National Domestic Preparedness
    Consortium, the National Terrorism Preparedness Institute at St.
    Petersburg Junior College, the United States Army's Pine Bluff Arsenal,
    and the National Sheriffs' Association.
    The National Domestic Preparedness Consortium
        The National Domestic Preparedness Consortium (NDPC) is the
    principal vehicle through which OSLDPS identifies, develops, tests and
    delivers training to state and local emergency responders. The NDPC
    membership includes OSLDPS's Center for Domestic Preparedness in
    Anniston, Alabama, the New Mexico Institute of Mining and Technology,
    Louisiana State University, Texas A&M University, and the Department of
    Energy's Nevada Test Site; each member brings a unique set of assets to
    the domestic preparedness program. The following is brief description
    of each member and their expertise:
      --Center for Domestic Preparedness (CDP) (Fort McClellan).--The CDP
            provides hands-on specialized training to state and local
            emergency responders in the management and remediation of WMD
            incidents. Located at the former home of the United States Army
            Chemical School, Fort McClellan, the CDP conducts live chemical
            agent training for the nation's civilian emergency response
            community. The training emergency responders receive at the CDP
            provides a valid method for ensuring high levels of confidence
            in equipment, procedures, and individual capabilities.
      --New Mexico Institute of Mining and Technology (National Energetic
            Materials Research and Testing Center) (NMIMT).--NMIMT offers
            live explosive training including the use of field exercises
            and classroom instruction. NMIMT is the lead NDPC partner for
            explosives and firearms, live explosives, and incendiary
            devices training.
      --Louisiana State University (LSU) (Academy of Counter-Terrorist
            Education).--LSU provides training to law enforcement agencies
            and focuses its efforts on the delivery of the Emergency
            Response to Terrorism: Basic Concepts for Law Enforcement
            Course, and the development and delivery of the Emergency
            Response To Domestic Biological Incidents Course.
      --Texas A&M University (National Emergency Response and Rescue
            Training Center).--Texas A&M delivers a set of courses to
            prepare public officials, emergency medical services, law
            enforcement, fire protection, and public works for the threat
            posed by WMD. Courses are developed and designed to provide
            each specific segment of the emergency response community with
            the tools needed to accomplish its role in the event of a WMD
            incident. Additionally, Texas A&M has developed an Interactive
            Internet WMD Awareness Course for emergency responders. Texas
            A&M also provides technical assistance to state and local
            jurisdictions in the development of WMD assessment plans.
      --United States Department of Energy's Nevada Test Site (National
            Exercise, Test, and Training Center) (NTS).--NTS conducts large
            scale field exercises using a wide range of live agent
            stimulants as well as explosives. NTS develops and delivers a
            Radiological/Nuclear Agents Course. NTS, in coordination with
            OSLDPS, is establishing the Center for Exercise Excellence. The
            Center will allow NTS to train jurisdictions in the planning
            and conduct of exercises, tailored to the unique threats faced
            by participating jurisdictions. The Center will provide a
            critically needed new component of the overall exercise
            training program, meeting those special exercise needs as the
            state and local jurisdictions define their exercise priorities.
    Other Training Partners
        The National Terrorism Preparedness Institute (NTPI).--NTPI, an arm
    of the Southeastern Public Safety Institute at St. Petersburg Junior
    College, delivers a satellite-based training program titled CoMNET
    (Consequence Management News, Equipment, and Training) to the nation's
    civilian and military emergency response communities. CoMNET is a news
    magazine style show providing WMD-related awareness information. This
    program is a joint effort between OSLDPS, the Combating Terrorism
    Technology Support Office Technical Support Working Group, and the
    Consequence Management Program Integration Office within DOD.
        Pine Bluff Arsenal (PBA).--PBA provides mobile training teams that
    deliver on-site technical assistance and training to state and local
    jurisdictions on the calibration, use, and maintenance of their
    radiological, chemical, and biological detection and response
    equipment.
        The National Sheriffs' Association (NSA).--NSA delivers an
    executive level introductory training program for sheriffs on domestic
    preparedness for WMD incidents. This course introduces and discusses
    the issues that a sheriff will confront in responding to a WMD
    incident, and provides training on pre-incident collaborations/
    preparations that can be implemented to improve incident response.
        In addition, OSLDPS provides training through its work with the
    Metropolitan Fire Fighters and Emergency Medical Services Program, and
    other public and private organizations such as the National Governors
    Association, International Association of Fire Fighters, and the
    National Emergency Management Association.
        Question. What more should the Federal Government be doing to
    prepare for potential terrorist incidents?
        Answer. The Department's 5-Year Interagency Counterterrorism and
    Technology Crime Plan outlines the Federal Government's comprehensive
    plan to prepare for and address terrorist threats. The 5-Year Plan
    contains concrete steps necessary to advance targeted research and
    development efforts; prevent, deter, and reduce vulnerabilities to
    terrorism and improve the capabilities of law enforcement agencies to
    respond cooperatively to terrorist acts; integrate crisis and
    consequence management; protect our national information
    infrastructure; and improve state and local capabilities for responding
    to terrorist acts, including acts involving weapons of mass destruction
    (WMD). This Administration is currently reviewing the counterterrorism
    program to determine what changes, if any, would be beneficial.
        To prepare for potential terrorist incidents, the Federal
    Government must strive to reduce our vulnerability to terrorist
    threats, including the threat of weapons of mass destruction (WMD) and
    cyber attack on the nation's critical infrastructures. In addition to
    preventive measures, we must also have in place the capability to
    respond to and deal effectively with the consequences of the use of
    such weapons.
        One facet of our national strategy is federal assistance to state
    and local agencies in the area of terrorism preparedness. The
    Department of Justice, through the Office of Justice Programs, provides
    significant assistance to state and local authorities by funding
    training, purchase of equipment, participation in exercises, and
    research and development to augment state and local capabilities.
        On May 8, 2001, the Administration announced its intention to
    create a new Office of National Preparedness within the Federal
    Emergency Management Agency (FEMA). Currently, a task force headed by
    Vice President Cheney has been asked to develop a coordinated national
    effort to bolster our national preparedness to address terrorist
    events. The Task Force's recommendations are expected in October 2001.
        Assistance to state and local agencies is but one facet of a
    national strategy; another is the federal operational response, which
    is structured for crisis and consequence management. Federal
    interagency cooperative efforts have culminated in the ``Guidelines for
    the Mobilization, Deployment, and Employment of United States
    Government Agencies in Response to a Domestic Threat or Incident of
    Terrorism in Accordance with Presidential Decision Directive (PDD)-39''
    and the ``United States Government Interagency Domestic Terrorism
    Concept of Operations Plan (CONPLAN).'' The CONPLAN, ratified in
    January 2001, is designed to provide overall guidance to federal,
    state, and local agencies concerning how the Federal Government would
    respond to a potential or actual terrorist threat or incident that
    occurs in the United States, particularly one involving WMD.
        Question. Does the Administration's cybercrime initiative address
    this issue?
        Answer. With regard to cyberterrorism, it is important to recognize
    that the Department prepares for cyberterrorism by enhancing its
    abilities to investigate cybercrime. In brief, when a cyber-attack
    first occurs, it is not immediately clear whether the attack is state-
    sponsored cyber-warfare, cyberterrorism by a transnational
    organization, or non-terrorist criminal activity, either domestic or
    foreign. Calling an event ``terrorism'' connotes a political or
    philosophical motive that is rarely ascertainable at the start of a
    cyber event. Therefore, DOJ thinks of ``computer crime'' as a larger
    set of cases that include ``cyber-terrorism.'' The personnel and legal
    tools used, at least initially and most often on a continuing basis, to
    investigate the crime are the same, although additional tools can be
    brought into play when appropriate predicates are met. Thus, the
    Department's cybercrime initiative, which involves enhancing the
    government's ability to investigate and prosecute cybercrime, directly
    addresses preparing for potential terrorist incidents.
        When cyber-based attacks on critical infrastructures do occur, DOJ
    is prepared through its efforts on both the cybercrime initiative and
    the National Plan for Information Systems Protection to respond
    quickly. First, DOJ's roles and responsibilities for initial response
    to such attacks are primarily borne by the National Infrastructure
    Protection Center (NIPC) in the FBI, which provides investigative
    support for all types of criminal and terrorist attacks on computer
    systems. Second, attorneys from the Computer Crime and Intellectual
    Property Section of DOJ's Criminal Division and Assistant United States
    Attorneys around the country work closely with the FBI and NIPC to
    conduct timely investigations, as little or no domestic investigation
    into such attacks can be undertaken without the use of subpoenas, or
    court orders to provide information, or wiretap requests. Accordingly,
    DOJ has, through the Computer and Telecommunications Coordinator (CTC)
    program, ensured that at least one prosecutor with expertise in online
    investigations (and who receive regular training and support by the
    Criminal Division's Computer Crimes and Intellectual Property Section
    (CCIPS)) are located in each of the 94 United States Attorneys Offices
    throughout the United States. These CTCs work closely with CCIPS, FBI,
    and NIPC specialists to respond to and investigate computer crime and
    computer terrorist attacks.
        With regard to response by state and local law enforcement, both
    NIPC and CCIPS consider participating in the training of state and
    local law to be a critical part of their missions. Both participate in
    the National Cybercrime Training Partnership, for example, an effort
    funded by the Bureau of Justice Assistance to develop modular
    cybercrime training usable by state, local and federal entities.
        The Department's counterterrorism efforts also include coordination
    with other agencies, private industry, and other governments and
    international organizations to protect our critical information
    infrastructure. The National Security Council (NSC) has established a
    Policy Coordinating Committee on Counter-Terrorism and National
    Preparedness, which, besides the Counter-Terrorism and Security Group,
    also has a subgroup specifically devoted to Information Infrastructure
    Protection and Assurance. DOJ coordinates with these groups and their
    subgroups on both prevention and incident response, as appropriate. In
    addition, DOJ works in close cooperation with other centers of
    expertise within the private sector and the Federal Government,
    including both the NSC's National Coordinator for Security, Critical
    Infrastructure and Counter-Terrorism and the Critical Infrastructure
    Assurance Office. DOJ is involved in counterterrorism coordination at
    the international level, under the leadership of the State Department,
    including representation of United States law enforcement and
    prosecutorial interests in multilateral groups such as the G-8
    Counterterrorism Experts Group and in bilateral meetings with
    counterterrorism officials of other nations. The FBI's Legal Attaches
    assigned to United States embassies throughout the world, also play a
    key role in counterterrorism issues that arise in the nation or region
    they cover.
        Moreover, under PDD-63, the FBI was given the role of coordinating
    the provision of emergency law enforcement services, or ELES, in the
    event of an attack on critical infrastructures. The FBI and NIPC have
    worked closely with a group of state and local law enforcement
    personnel to develop a response plan for that sector. A draft sector
    plan was issued in March 2001, and was held up as a model for other
    sector plans at the Partnership for Critical Infrastructure Security
    conference held March 20-21, 2001. Similarly, other agencies are
    working with industry in their designated sectors to develop plans for
    protecting infrastructures from cyber attacks and responding to them.
    These sectoral plans also provide input into the National Plan for
    Information Systems Protection, version 1.0 of which was released on
    January 15, 2000, and which the United States Government intends to
    update periodically with additional information and programs to respond
    to the changing technology and threats in this area.
            black tar heroin drug trafficking in northern new mexico
        Question. This Subcommittee has been very helpful over the past 2
    years in tackling an issue of great concern to me. That issue is the
    serious ``black tar'' heroin problem that has plagued several northern
    New Mexico counties.
        Both the FBI and DEA have cooperated with the state and local law
    enforcement officials in New Mexico to try to break the serious cycle
    of Black Tar Heroin Trafficking and use. Several major drug busts have
    been implemented in this area of New Mexico.
        Would you please give the Subcommittee the Department's assessment
    of the progress these joint law enforcement operations in breaking the
    Black Tar Heroin ring in Northern New Mexico?
        Answer. In December 1999, the Special Operations Division initiated
    ``Operation Tar Pit'', a multi-jurisdictional investigation targeting a
    Mexican heroin trafficking organization. The FBI's Albuquerque
    Division, the Drug Enforcement Administration (DEA) and the New Mexico
    State Police (NMSP) with other local law enforcement agencies (LEAs) in
    northern New Mexico have focused this investigation on a well
    entrenched heroin distribution organization controlled by individuals
    from Tepic, Nayarit, Mexico. Primarily, this organization smuggles
    multi-kilogram quantities of high purity Mexican black tar heroin from
    Mexico into the United States along the California and Arizona borders.
    However, one of the organization's primary distribution cells was
    located in northern New Mexico. The organization routinely sent
    couriers and distributors from Nayarit to the United States to
    transship and sell heroin. After approximately 6 months, the leaders of
    the organization would order the distributors back to Mexico and other
    individuals would be sent as replacements.
        On June 15, 2000, a nationwide takedown of Operation Tar Pit
    targets occurred in several cities throughout the United States. In New
    Mexico, 34 subjects were arrested and prosecuted, with all of these
    subjects convicted of drug-related offenses. To date, Operation Tar Pit
    has resulted in the seizure of approximately 64 pounds of high purity
    black tar heroin, $300,000, numerous vehicles, 10 weapons, one
    residence, and the arrest of 249 individuals.
        In fiscal year 2001, the FBI allocated 21 agents to the Albuquerque
    Division and local resident agencies to address the drug problem. The
    Albuquerque Division has two agents assigned to the DEA task force.
    This task force relationship maximizes both the FBI's and the DEA's
    investigative efforts in the Northern New Mexico area. Additionally,
    the Albuquerque Division's Assistant Special Agent in Charge is the
    Chairman of the New Mexico High Intensity Drug Trafficking Area (HIDTA)
    Executive Board.
        Together with DEA and other LEAs, the FBI has been working closely
    to address the full scope of the Northern New Mexico drug problem.
    Traditionally, northern New Mexico's primary illegal drug threat has
    been the transshipment and distribution of cocaine and black tar
    heroin. In recent years, however, the manufacture, transshipment and
    distribution of methamphetamine has developed into a significant, if
    not epidemic, problem in New Mexico. Mexican drug trafficking
    organizations smuggle bulk quantities of methamphetamine into the state
    from labs in Mexico and California. Law enforcement agencies have also
    discovered an increased number of methamphetamine laboratories being
    operated in the state. Two laboratories seized in 2000 were ``super
    labs,'' capable of producing over ten pounds of the drug per production
    run.
        In February 2001, the Albuquerque Division of the FBI, in
    conjunction with the DEA and local law enforcement agencies, culminated
    the first phase of a 16-month drug investigation with the arrests of 25
    federal subjects and 35 state subjects. The subjects were members of a
    drug trafficking organization described as the primary source of
    cocaine in northern New Mexico. The organization was transshipping
    cocaine from Mexico and California to distribution organizations in
    northern New Mexico and other areas of California. The organization was
    also associated with two drug trafficking organizations on the FBI's
    National Priority Target List.
        The FBI, DEA, NMSP and the various state and local law enforcement
    agencies continue to work closely together to target heroin
    distribution organizations operating in northern New Mexico. These
    investigations, in conjunction with ``Operation Tar Pit,'' have greatly
    reduced the availability of black tar heroin and its associated crime
    problems. Also, multi-agency efforts targeting multiple organized
    criminal enterprises involved in drug trafficking show considerable
    result and only through a sustained multi-agency effort will LEAs be
    able to eliminate the distribution and use of heroin as a major drug
    problem in northern New Mexico.
                               ins restructuring
        Question. The Immigration and Naturalization Service's (INS)
    mission involves carrying out two primary functions. One is an
    enforcement function that involves preventing aliens from entering the
    United States illegally and removing aliens who succeed in doing so.
    The other is a service function that involves providing services or
    benefits to facilitate entry, residence, employment, and naturalization
    of legal immigrants.
        Several critics have concluded that mission overload has impeded
    INS from succeeding at either of its primary functions and that INS'
    service and enforcement functions should be separated in order to
    better administer immigration law. Consequently, there have been
    several proposals to fundamentally restructure INS.
        What is your view of how the federal immigration function should be
    organized in order to effectively and efficiently administer the
    Immigration laws?
        Can you give this committee any idea of what kind of financial
    obligation the federal government might have to undertake in order to
    achieve the goal?
        Answer. Recognizing that the Nation's immigration system must be
    significantly strengthened and with the support of Congress, in 1998
    and 1999, the INS engaged in a comprehensive review of the way it does
    business with the purpose of developing proposals for the restructuring
    of the agency in such a manner as to ensure a balance between its dual
    critical missions of preventing illegal migration on one hand and
    providing services to those who wish to enter the country legally on
    the other. President Bush, in his ``Blueprint for New Beginnings''
    which was issued in February recognized the challenges faced by the INS
    and proposed a splitting of the agency into separate enforcement and
    immigration services entities each reporting to a single policy leader
    in the Department of Justice. The costs related to implementing this
    restructuring have not been determined.
        I am prepared to work closely with the Congress to ensure that
    those structural changes that are necessary for the INS to fulfill its
    vital enforcement and service responsibilities more effectively are
    implemented in the most reasonable and cost effective manner possible.
        Question. Although Congress has more than doubled INS' budget and
    staffing levels since 1993, INS has had ongoing problems both managing
    its programs and achieving results. For example, INS has clamped down
    in certain locations, such as San Diego and El Paso, but instead of
    deterring illegal immigration, these efforts seem to have simply
    shifted the illegal traffic to areas such as El Centro, California and
    Yuma, Arizona, as well as some significant trouble spots in my home
    state of New Mexico.
        I am pleased to see that the new Administration will continue to
    support the Southwest Border Initiative in fiscal year 2002. One of the
    primary goals of this initiative is to respond quickly to the
    continuously changing locale of significant border problems. Whether it
    be funding for a new Border Patrol station or a new service processing
    center, the Southwest Border Initiative is a valued program that
    effectively deals with the complex world of immigration law.
        I would be curious to know your views on the Southwest Border
    Initiative, both good and bad, and whether or not the Justice
    Department will continue to support this vital program in the future.
        Answer. The Justice Department supports the Southwest Border
    Initiative as summarized in the President's blueprint for the fiscal
    year 2002 budget. The President's plan provides for 570 Border Patrol
    agents in each of fiscal year 2002 and fiscal year 2003, along with
    needed technology. The 1,140 new agents would complete staffing of the
    5,000 new agents Congress authorized INS to hire beginning in fiscal
    year 1997 as part of the Southwest Border Initiative.
        INS has been bringing the major corridors of illegal migrations
    under control, and is currently in Phase II (Tucson, Laredo, Del Rio,
    McAllen Sectors) of the Border Patrol National Strategy. The success of
    border control rests greatly on the combination of appropriate levels
    of Border Patrol agents, technology, and enforcement infrastructure. In
    fiscal year 2001, we are seeing indications that deterrence is working.
        Unfortunately we are continuing to experience attempts to cross the
    most dangerous and remote areas of the border. These attempts have
    resulted in significant border safety issues. We have been working with
    many Mexican government officials to educate and discourage migrants
    from making these dangerous entries. The Border Patrol is being
    trained, and when needed, deployed to sites in order to act as rescue
    teams, to save lives when migrants don't heed these warnings or are
    lead into danger by smugglers that have no regard for human life.
                              combating terrorism
        Question. The Bush Administration has indicated that it intends to
    continue a plan based on a Clinton presidential directive from 1995
    that outlines how the Federal Government intends to respond to
    terrorism, particularly acts that involve chemical or biological
    warfare. This plan also provides guidance for federal, state, and local
    agencies on preparing for and dealing with potential threats and
    incidents. The Federal Bureau of Investigation (FBI) and the Federal
    Emergency Management Agency (FEMA) will take the lead in handling
    domestic threats and acts.
        Clearly, this is a very important issue and I certainly support the
    idea of funding efforts to protect all Americans from deadly acts of
    domestic terrorism.
        Simply from a funding viewpoint, my question is this Mr. Attorney
    General--how will the Justice Department calculate its request for this
    initiative each fiscal year and, specifically, would the terrorist
    threat levels discussed in the strategic plan play a part in any one
    year's funding request? Put more simply, do you think funding for
    combating terrorism should be threat-driven?
        Answer. The 5-Year Interagency Counterterrorism and Technology
    Crime Plan encompasses a program for national readiness to address a
    broad range of terrorist threats. To be effective, this program needs
    to be maintained consistently over time, rather than be a function of
    the variations in annual funding. While flexibility to respond to
    specific, emerging threats is necessary, consistent baseline funding
    for the broad range of potential threats is imperative.
                      linking doj's budget to performance
        Question. According to the 2002 budget, the Administration has
    mandated that agencies use performance-based budgeting on selected
    programs in the fiscal year 2003 budget cycle.
        Under this mandate, agencies will be required to submit
    performance-based budgets for selected programs in the fiscal year 2003
    budget process, the first time agencies have been required to tie their
    spending decisions to performance goals.
        As you have discovered in your new position, the Department of
    Justice was among the poorest performers under the criteria by which
    performance plans were reviewed by the GAO as well as in the Mercatus
    evaluation.
        Please tell me what specific steps you see necessary to improve the
    Department's performance plan and how this will be coupled to the new
    mandate.
        Answer. Each year, the Department of Justice has worked to improve
    its performance plans and reports. Although last year's report was not
    favorably reviewed by GAO and the Mercatus Center, we are confident
    that our ratings will improve this year. In fact, on May 16 we received
    our score from the Mercatus Center on its review of the fiscal year
    2000 Performance Report. The Department of Justice rose from 21st place
    to 5th place governmentwide; our score improved by 15 points.
    Notwithstanding this positive feedback, we will continue to work
    diligently to improve our performance plan for fiscal year 2003.
        To improve the overall performance management process at the
    Department, I have established the Strategic Management Council. This
    Council will serve as the formal board within the Department to provide
    direction and leadership on long-range planning and initiatives. The
    Council will formulate and oversee the planning, programming and
    budgeting process for the Department. The Council will reinforce the
    linkages among the Department's Strategic Plan, Performance Plan, and
    budget process. Development of this Council marks the renewal of an
    integrated management system for the Department, and will ensure that
    the Administration's policies and priorities are successfully
    implemented.
        Question. Do you have preliminary thoughts on which programs will
    be chosen for performance-based budgeting?
        Answer. We are working with the Office of Management and Budget to
    determine which programs will be chosen for performance-based pilots.
    Preliminarily, we are considering the INS--benefits services, Bureau of
    Prisons--prison capacity, and counterterrorism as potential candidates
    for performance-based budgeting pilots.
              continued operating and management problems for ins
        Question. The U.S. Immigration and Naturalization Service has long
    been the target of inquiries concerning its operation and management.
        Last week, the DOJ Inspector General (IG) released the results of a
    review which gathered information over the past 3 years concerning the
    INS' ability to account for weapons and computers. The DOJ IG noted
    that the agency could not account for 61,000 items worth about $70
    million. These items included 539 weapons and 12,000 laptop, desktop,
    and notebook computers. The IG criticized the agency for its failure to
    require inventories of agency equipment and the failure of INS
    officials to ``adequately safeguard property.'' It concluded, ``without
    immediate corrective action, property will remain at substantial
    risk.''
        A number of these computer-related operating deficiencies were
    supposed to improve following the March 2000 IG report that also found
    serious deficiencies. Subsequently, extensive computer-training
    programs and an updated record-keeping procedure were implemented
    within the agency.
        However, based on this IG finding and as you have discovered in
    this new position, these operating problems continue to persist.
        Please tell me what specific steps you see necessary to improve the
    agency's performance in this regard.
        Answer. The Office of the Inspector General (OIG) audit report
    finding is based on 1998 data. The Service has already taken steps to
    address the problems it identified in that report.
        INS re-engineered the inventory process in 1998, reducing the
    administrative burden while focusing limited resources on high-risk,
    high-dollar property, including computers and firearms.
        Since 1998, all personal property with an original cost of more
    than $5,000 and all firearms are inventoried annually. The accuracy of
    those inventories are certified by senior managers (i.e., Management
    Team members, District Directors, Chief Patrol Agents, etc.). The
    inventories are then independently reconciled and audited.
        Of the 539 firearms the OIG identified as lost, stolen or missing,
    43 weapons were found, 131 were confirmed as lost or stolen, and 87
    were determined to be typographical or database entry errors. The
    remaining 278 cases are under investigation.
        Other selected property, including all computer and related
    equipment with memory acquired for less than $5,000, is inventoried
    biennially. Those inventories are also certified as accurate by the
    Service's senior management. The first cycle of biennial inventories
    ended on September 30, 2000. Their accuracy will be evaluated through
    the INSpect program and property management reviews.
        The INS has passed the Chief Financial Officers' Act audit for
    capitalized personal property each of the last 3 years.
        The INS is implementing all recommendations from the OIG audit
    report.
        Question. Do you consider these weaknesses as candidates for
    performance-based budgeting?
        Answer. Contained within the INS Strategic Plan, under Strategic
    Objective 4.6, Immigration Infrastructure, is Program Strategy 4.6.4,
    ``Maximize use of available and potential financial resources through
    improved controls over assets, payables and receivables''. ``Improved
    controls over assets'', include all INS inventories and serve as the
    performance motivator driving the changes and improvements discussed
    above under question number one.
                                     ______

                 Questions Submitted by Senator Mitch McConnell
                                   oxycontin
        Question. As you may know, in recent months several states in the
    South and Midwest, including Kentucky, have witnessed an epidemic of
    illegal distribution and use of the prescription painkiller, OxyContin.
    Recently, there have been hundreds of arrests of OxyContin drug dealers
    in my home state of Kentucky. And the abuse of this controlled
    substance has already led to hundreds of deaths around the country and
    scores of fatalities in Kentucky alone. The illegal use and
    distribution of OxyContin is a serious problem for our country. Do you
    see the need for a federal role in the efforts to prevent the illicit
    prescription, sale, and use of this drug? If so, what is that role?
    More specifically, do you have any programs already established, or are
    you beginning to develop initiatives, to help deal with this problem?
    If so, what are they? What would you need from Congress to expand those
    programs or implement those initiatives?
        Answer. The purpose of the Drug Enforcement Administration's
    Diversion Control Program is to prevent, detect and investigate the
    diversion of controlled substances from legitimate channels, while at
    the same time, ensuring an adequate and uninterrupted supply of
    controlled substances required to meet legitimate needs. The Chemical
    Diversion and Trafficking Act of 1988 extended this control to include
    those chemicals most often used for the manufacture and synthesis of
    drugs of abuse.
        The Office of Diversion consists of diversion investigators,
    special agents, chemists, pharmacologists, program analysts and others.
    The office's activities include: program priorities and field
    management oversight; coordination of major investigations; drafting
    and promulgating of regulations; establishment of national drug
    production quotas; design and execution of diplomatic missions; United
    States obligations under drug control treaties; design and proposal of
    national legislation; advice and leadership on state legislation/
    regulation; legal control of drugs and chemicals not previously under
    federal control; control of imports and exports of drugs and chemicals;
    computerized monitoring and tracking the distribution of certain
    controlled drugs; providing distribution intelligence to the states;
    industry liaison and program resource planning and allocation.
        Many of the narcotics, depressants and stimulants manufactured for
    legitimate medical use are subject to abuse, and have therefore been
    brought under legal control. Under federal law, all businesses which
    manufacture or distribute controlled substances, all health
    professionals entitled to dispense, administer or prescribe them and
    all pharmacies entitled to fill prescriptions must register with the
    DEA. Registrants must comply with a series of regulatory requirements
    relating to drug security, record accountability and adherence to
    standards.
        The DEA is obligated under international treaties to monitor the
    movement of licit controlled substances across United States borders
    and for issuing import and export permits for that movement. The DEA
    also devises ways to deal with problems of international drug
    diversion. Diversion cases involve, but are not limited to, physicians
    who sell prescriptions to drug dealers or abusers; pharmacists who
    falsify records and subsequently sell the drugs; employees who steal
    from inventory; executives who falsify orders to cover illicit sales;
    prescription forgers and individuals who commit armed robbery of
    pharmacies and drug distributors. At present, the largest problem
    results from the criminal activity of physicians and pharmacy
    personnel.
        OxyContin is manufactured exclusively by Purdue Pharma
    headquartered in Norwalk, Connecticut. It was introduced in 1996 and
    had total sales of $26 million in the first eight months. Sales now
    total $1 billion. OxyContin, which is manufactured in 10 milligram, 20
    milligram, 40 milligram, 80 milligram, and 160 milligram tablets, is a
    12-hour controlled-release form of the Schedule II drug, oxycodone. It
    is legitimately prescribed for people with chronic moderate to severe
    pain, such as arthritis, back conditions, cancer, etc. It is also used
    post-operatively for pain relief. OxyContin has become the drug of
    choice in many pain management clinics. The controlled release
    formulation of OxyContin has become popular among drug abusers because
    (a) it contains larger and reliable doses of active ingredient; (b) the
    tablet formulation is easily compromised; and (c) prescriptions are
    often covered by the abuser's health insurance. It is referred to by
    abusers as ``pharmaceutical heroin.'' Street names are ``C'',
    ``Oxycotton'' and ``OC''. OxyContin in toxic amounts causes respiratory
    depression and arrest.
        The abuse of OxyContin in Kentucky has set off a wave of pharmacy
    break-ins, employee pilferage, emergency room visits and arrests of
    physicians and other health care workers. The Kentucky State Health
    Department Records show that the amount of OxyContin dispensed in the
    state almost doubled from 1999 to 2000. Kentucky now ranks 13th
    nationally in per capita consumption of oxycodone. The Kentucky State
    Division of Substance Abuse reports that up to 90 percent of the 1,100
    people enrolled in the state's methadone program got there by using
    prescription drugs, particularly OxyContin. One Kentucky Police
    Department reports that OxyContin abuse has become so prevalent that 85
    to 90 percent of their field work is OxyContin-related. The illegal
    selling price of OxyContin in southeast Kentucky is $1 per milligram
    plus $5 added to the total amount. Thus a 40 milligram tablet costs
    $45; an 80 milligram tablet costs $85. OxyContin 80 milligram tablets
    are being split in half and sold as two 40 milligram tablets. Law
    enforcement personnel in the state are now seeing some evidence of
    OxyContin coming from Mexico.
        Initiatives have been taken in the state of Kentucky to deal with
    the OxyContin problem.
      --The Governor of Kentucky appointed a task force consisting of
            several state law enforcement agencies to combat the illegal
            trafficking of OxyContin. Residents in 3 counties, Bell, Knox
            and Perry, have conducted meetings to discuss strategy in
            fighting the abuse. Bell County had such a large turnout that
            the meeting was held at a baseball field. One woman has
            spearheaded a grass root committee and formalized a petition to
            commit individuals to unite against this problem. Additionally,
            businessmen in Perry County have raised $20,000 to help in this
            fight and to educate people regarding the dangers of OxyContin
            abuse.
      --Federally, the DEA has a district office located in Louisville, KY,
            2 resident offices, (one in Lexington and the other in London,
            KY), and a Post of Duty in Madisonville, KY. These offices are
            staffed with 19 special agents, 7 diversion investigators, 2
            intelligence specialists, 5 clerical assistants and 1 contract
            data analyst. DEA participates in a High Intensity Drug
            Trafficking Area (HIDTA) Intelligence Group and a Provisional
            Task Force operating out of the Appalachian HIDTA Headquarters
            in London. The DEA has played a prominent role in attempting to
            curb the OxyContin trafficking in Kentucky as shown in the
            following 3 cases:
        --A single physician responsible for the dispensing of over 79,000
                dosage units of Schedule 2 drugs (primarily OxyContin) and
                over 1.7 million dosage units of Schedule 3 hydrocodone
                products was indicted in January, 2001. The doctor and his
                wife have pled guilty to charges of conspiracy and illegal
                distribution of controlled substances in federal court.
                Sentencing of the pair and additional indictments are
                pending.
        --A long standing ``pill house'' where pharmaceutical drugs were
                illegally bought and sold was investigated and the owners
                successfully arrested and prosecuted. The investigation
                resulted in 12 guilty pleas in federal court to conspiracy
                to distribute drugs or possession with intent to
                distribute. Property and cash with a value of over $1.5
                million was forfeited last year.
        --A forgery ring involved in passing stolen hospital prescriptions
                for OxyContin has been identified and immobilized. Members
                of the organization, which included a registered nurse,
                were responsible for obtaining approximately 5,000
                OxyContin tablets illegally. Indictments are pending.
        The Assistant United States Attorney in Kentucky has established a
    50 dosage unit criteria as the basis for prosecuting an OxyContin case.
    HIDTA has given money to local enforcement authorities to support their
    OxyContin investigations. DEA continues to work with federal, state and
    local law enforcement to identify doctors who are prescribing OxyContin
    excessively and has requested that the Kentucky Pharmacy Board notify
    all pharmacies to scrutinize OxyContin prescriptions before filling.
    They are also being reminded to report pharmacy thefts to DEA.
        DEA is concerned over field reports of Purdue Pharma's aggressive
    marketing practices. It is reported that Purdue recruits doctors by
    giving them paid trips and speaking engagements at seminars sponsored
    by the company. These seminars are designed to encourage the
    prescribing of OxyContin for pain treatment. In recognition of this
    nation-wide problem and in a show of support for DEA's endeavors,
    Purdue Pharma has voluntarily suspended further distribution of
    OxyContin 160 milligram tablets. Still, DEA has developed a four part
    OxyContin action plan on a national level. The elements of this plan
    are as follows:
      --Enforcement and Intelligence.--Coordinated operations have been
            initiated in field offices to target individuals and
            organizations involved in the diversion and abuse of OxyContin.
            This includes coordination with federal, state and local
            agencies.
      --Regulatory and Administrative.--DEA is utilizing the full range of
            its regulatory and administrative authority in pursuing action
            that will make it more difficult for abusers to obtain
            OxyContin. DEA will work closely with the Food and Drug
            Administration (FDA) to strongly urge the rapid reformulation
            of OxyContin by Purdue Pharma, to the extent that it is
            technically possible, in order to reduce the abuse of the
            product, particularly by injection.
      --Industry Cooperation.--DEA continues to stress the importance of
            voluntary cooperation from industry in adhering to the spirit
            and substance of existing law and regulation. The agency is
            increasing its cooperative efforts with all levels of industry
            in order to stem the abuse and diversion of OxyContin. As the
            sole manufacturer of OxyContin, the cooperation of Purdue
            Pharma is integral to the success of DEA's action plan.
      --Awareness/Education/Outreach Initiatives.--An aggressive, national
            outreach effort will be made to educate the general public,
            schools, the healthcare industry and state and local
            governments on the dangers related to the abuse of OxyContin.
        The diversion and abuse of legitimate controlled substances
    continues to be a threat to the health and safety of the citizens of
    the United States. This type of diversion occurs mainly at the
    pharmacy/physician level of the pharmaceutical distribution chain.
    Numerous individuals and groups divert legitimate controlled substances
    using various fraudulent prescription schemes. Additionally, certain
    health care professionals become involved in this diversion and abuse
    through theft, over-prescribing, prescription schemes and illegal sale.
                                     ______

             Questions Submitted by Senator Ben Nighthorse Campbell
             department of justice response to international crime
        Question. What types of international crime are of principal
    concern to the Department of Justice (DOJ), and what is the basis for
    this concern? In overall terms, given that there are likely to be
    competing demands among the different types of international crime that
    are of concern, how do you propose to set priorities in addressing
    these crimes?
        Answer. The Department is particularly concerned about
    international organized crime and terrorist groups that engage in
    criminal conduct with direct effects on the United States and its
    citizens, including drug trafficking, terrorism, money laundering, and
    other traditional criminal activity. Emerging criminal areas such as
    cybercrime, including hacking, theft of intellectual property, child
    pornography, the infiltration of brokerages to manipulate stock
    markets, internet gambling, and the increasing infiltration of
    legitimate businesses are also areas of great concern.
        The December 2000 inter-agency International Crime Threat
    Assessment is one of many resources relied upon by the Department in
    order to set priorities in addressing international crime. The Federal
    Bureau of Investigation, the Drug Enforcement Administration, and the
    Criminal Division also conduct more specific threat assessments, survey
    domestic and international field offices, review intelligence
    reporting, and liaison with foreign law enforcement organizations, in
    order to identify international criminal enterprises which pose the
    greatest threats to the nation.
        The Department's priorities also emerge out of our on-going
    experience in addressing international crime, the principal dimensions
    of which can be summarized as follows:
      --Domestic Prosecution of International Crime.--The United States
            Attorneys Offices and the litigating sections of the Criminal
            Division prosecute international criminal activity that
            violates our federal laws, including international organized
            criminal activity, narcotics offenses, money-laundering, cross-
            border fraud, transnational computer crime, alien smuggling,
            terrorist financing, and transborder trafficking in humans. The
            Criminal Division also provides critical technical assistance,
            oversight, and coordination for prosecutors in cases involving
            fugitives, money-laundering and forfeiture, and evidence
            located abroad as well as in multi-district investigations
            against international criminal organizations. The knowledge,
            experience, and lessons learned from these cases play a major
            role in helping define Departmental priorities.
      --International Prosecutorial Cooperation.--DOJ's Criminal Division
            leads the development of international cooperation in
            prosecuting international crime. The Division negotiates all
            law enforcement treaties and agreements, including bilateral
            extradition and mutual legal assistance treaties, and
            multilateral treaties, such as the recently completed
            Transnational Organized Crime Convention and the United Nations
            International Convention for the Suppression of Terrorist
            Financing. In negotiating these treaties, the Criminal Division
            works in tandem with the Department of State and, where
            appropriate, other Departments. The Criminal Division is also
            responsible for the implementation of these treaties and
            agreements. In this latter capacity, the Criminal Division
            processes all outgoing and incoming requests for extradition
            and formal mutual legal assistance, on both the federal and
            state level; thus, the Criminal Division is the channel for law
            enforcement assistance beyond what can be rendered through
            informal police-to-police channels. In addition, in the areas
            of narcotics and money laundering, the Criminal Division
            conducts a rigorous bilateral case development program with
            several countries--primarily those within this hemisphere. In
            connection with terrorism matters, the Department conducts
            ongoing, bilateral case development efforts with numerous
            countries in Europe, Asia, North America and the Middle East.
            The Criminal Division also participates in numerous
            international fora, through which we work with our law
            enforcement partners to develop coordinated strategies to
            address particular problems in transnational crime enforcement
            and to bring collective pressure to bear on other nations to
            comply with important standards in combating international
            crime. More generally, the Criminal Division reviews, and
            provides advice on, sensitive international law enforcement
            issues. The Department's cooperative relationships with
            international counterparts provide valuable insights into the
            nature and extent of international crime threats and the
            effectiveness of measures to address them.
      --Responsibility for International Law Enforcement Training And
            Assistance.--The Criminal Division provides technical legal and
            legislative drafting assistance, leadership and administrative
            support for rule of law development as it relates to training
            of foreign prosecutors and (together with federal law
            enforcement agencies) training and institutional development of
            foreign police and prosecutorial forces. This assistance
            includes not only developing and strengthening police, criminal
            investigative and prosecutorial institutions, and training of
            police, criminal investigators and prosecutors; but also advice
            in drafting modern criminal legislation that gives foreign
            police and prosecutorial agencies the statutory powers
            necessary for effective response to transnational organized
            crime. Much of this assistance is funded through the State
            Department, but also involves technical review from legal
            experts in the Criminal Division, funding from such sources as
            the Assets Forfeiture Fund, and participation in training
            sponsored by other law enforcement agencies. Through its
            prosecutorial and police institution building and training, the
            Criminal Division helps create more stable and effective
            foreign counterparts--counterparts that can fight crime within
            their own countries before it becomes an international threat,
            and that also can cooperate with the United States in fighting
            crime that already has crossed national boundaries. The
            exchange of information that occurs in the course of the
            Department's international training programs helps identify
            long-range law enforcement training and institutional
            development priorities.
      --International Efforts To Combat Public Corruption.--As part of the
            1998 International Crime Control Strategy, the Department has
            been actively involved in bilateral and multilateral efforts to
            address public corruption, including anti-corruption efforts of
            the Council of Europe (COE), including the COE's Criminal Law
            Convention on Corruption--signed by the United States in the
            Fall of 2000 and currently pending Senate ratification; the
            COE's Group of States Against Corruption (GRECO)--established
            in 1999 to monitor compliance with the COE's anti-corruption
            commitments and joined by the United States in the Fall of
            2000; the Inter-American Convention Against Corruption--
            ratified by the Senate in the Summer of 2000; the South Eastern
            Europe Stability Pact's Anti-corruption Initiative, and the
            Global Forum on Fighting Corruption and Safeguarding Integrity.
            The Department's ongoing work includes negotiating
            international anti-corruption agreements and providing
            assistance relating to the implementation of these agreements,
            including significant participation in the development and
            implementation of effective monitoring mechanisms. The
            Department's participation in international anti-corruption
            activities, in particular its role in anti-corruption mutual
            evaluation mechanisms, provides important information about the
            reliability and integrity of law enforcement counterparts,
            which can be used to identify enforcement priorities, target
            technical assistance and guide decisions about the appropriate
            extent of coordination and cooperation in particular cases.
        Question. In specific terms, how does the Department of Justice
    intend to ensure that its response to international crime is fully
    coordinated and integrated among the Department's various components?
        Answer. The Assistant Attorney General for the Criminal Division,
    directly and through his Deputy Assistant Attorneys General, will
    continue to play a leading role in ensuring that international criminal
    matters are fully coordinated within the Criminal Division and the
    Department as a whole. On high profile or particularly sensitive
    matters, the Office of the Deputy Attorney General and the Office of
    the Attorney General will continue, as appropriate, to have a direct
    role in coordinating the input from various internal components. In
    addition, internal coordination of specific international crime cases
    or issues is an integral and important responsibility of many
    Department components. For example:
      --The Office of International Affairs (OIA) supports the litigating
            components of the Criminal Division, the United States
            Attorneys Offices, and state and local prosecutors in their
            investigation and prosecution of crimes with an international
            dimension. The OIA negotiates, brings into force, and utilizes
            extradition treaties, mutual legal assistance treaties, and
            other international agreements designed to facilitate the
            investigation and prosecution of international crime.
      --The Special Operations Division (SOD) is a multi-agency body
            designed to identify and dismantle significant international
            and domestic drug trafficking and money laundering
            organizations. The Narcotic and Dangerous Drug Section (NDDS)
            directs and coordinates SOD investigations with Assistant
            United States Attorneys across the country to ensure that each
            district involved in a nationwide investigation is informed as
            to the actions taking place in the other districts and the
            interrelationship of each district in the overall criminal
            conspiracy.
      --The Asset Forfeiture and Money Laundering Section (AFMLS) provides
            litigative support to the United States Attorneys Offices and
            investigative agencies in cases where the predicate crime for
            money laundering has concomitant money laundering offenses as
            well as providing legal support and assistance in forfeiture
            cases with international aspects.
      --The Terrorism and Violent Crime Section (TVCS) coordinates multi-
            district terrorism financing investigations; provides advice,
            guidance and litigation support to United States Attorneys
            Offices pursuing terrorism financing investigations and
            prosecutions; and facilitates access to foreign evidence in
            support of these investigations.
      --The Organized Crime and Racketeering Section (OCRS) supervises and
            coordinates organized crime prosecutions brought by its 23
            Strike Forces in United States Attorneys Offices around the
            country, provides litigation support to the Strike Forces, and
            acts as a clearing house for the collection and dissemination
            of information vital to the investigation and prosecution of
            international organized crime groups violating federal law.
      --For the last 3 years, the Computer Crime and Intellectual Property
            Section (CCIPS) has held meetings about every 6 weeks with a
            large interagency group (now with about 110 invitees) to inform
            other Departmental components and other agencies about CCIPS'
            international work. The existence of this group, and the many
            other meetings and communications that take place as necessary,
            ensure that there is effective coordination in the cybercrime
            area. In addition, CCIPS provides very frequent training and
            litigation advice to other components in order to disseminate
            current policy views and to keep them consistent.
      --The Public Integrity Section plays a significant role in
            coordinating the views of the Department regarding
            international corruption matters. For example, the Section
            headed an interagency working group, which also included
            representatives from the Fraud Section, AFMLS, and OIA, charged
            with coordinating the Department's participation in the
            development and implementation of the Council of Europe's anti-
            corruption program. In addition, the Section heads an intra-
            agency working group of United States experts designated to
            conduct on-site mutual evaluations of GRECO member states. The
            Section is also coordinating preparation of the United States
            response to GRECO's evaluation of United States anti-corruption
            efforts.
        Question. How does the Department of Justice propose to coordinate
    its response to international crime with the efforts of other federal
    agencies--such as the Departments of State and Treasury--to ensure, to
    the extent possible, that the response is focused, results-oriented,
    and sustained, and that the potential for bureaucratic overlap reduced?
        Answer. The Assistant Attorney General for the Criminal Division,
    directly and through his Deputy Assistant Attorneys General, will
    continue to play a leading role in ensuring that international criminal
    matters are appropriately coordinated with other federal agencies. On
    high-profile or particularly sensitive matters, the Office of the
    Deputy Attorney General and the Office of the Attorney General, when
    appropriate, will continue to play a direct role in guiding inter-
    agency coordination. Most inter-agency coordination, however, will
    continue to occur routinely at lower levels. In this regard, the
    Department has developed a number of programs and mechanisms for the
    coordination of international criminal investigations and prosecutions,
    as well as working groups and other coordinating mechanisms to deal
    with specific international crime policy and program issues. For
    example:
    Criminal Division
        The Office of International Affairs (OIA) handles all international
    extradition and mutual legal assistance cases made by or to the United
    States. In concert with the State Department, OIA also negotiates,
    brings into force, and implements new extradition and mutual legal
    assistance treaties. In addition, OIA participates in the negotiation
    of other law enforcement treaties, conventions and agreements related
    to international criminal law. It also provides advice on international
    law enforcement issues. OIA also provides technical assistance in the
    form of training to federal, state, and local law enforcement
    authorities in the United States. Such training is primarily on
    international extradition and mutual legal assistance, but sometimes
    covers additional subjects related to international criminal law.
        The Office of Overseas Prosecutorial Development, Assistance and
    Training (OPDAT), the International Criminal Investigative Training
    Assistance Program (ICITAP), NDDS, and AFMLS work with the interagency
    community to ensure appropriate United States support for Plan
    Colombia, including strengthening Colombian law enforcement and
    judicial institutions.
        The Fraud Section is directing interagency feasibility studies to
    determine whether international coordinating bodies should be
    established for bank fraud and securities fraud.
        The Fraud Section maintains close contact with the State and
    Commerce Departments, which regularly refer allegations of Foreign
    Corrupt Practices Act (FCPA) violations. In addition, the Section
    routinely consults with the State Department regarding potential
    enforcement proceedings.
        The Fraud Section participates jointly with the State and Commerce
    Departments in the Working Group on Bribery in the Organization for
    Economic Cooperation and Development (OECD), which is responsible for
    the monitoring procedure under the 1997 OECD Convention on Combating
    Bribery of Foreign Public Officials in International Business
    Transactions. Negotiation of the Convention was the result of close
    coordination of the Justice, State and Commerce Departments, with
    additional coordination with the Department of Treasury and the United
    States Securities and Exchange Commission (SEC) on issues relating to
    taxation and securities law. The Justice, State and Commerce
    Departments work closely in the preparation of the annual reports to
    the House and Senate on the implementation of the OECD Convention.
        The Organized Crime and Racketeering Section (OCRS) is responsible
    for coordinating enforcement programs involving traditional organized
    crime (La Cosa Nostra), Russian, Asian and Italian/Sicilian organized
    crime in this country with international ties and works closely with
    the Federal Bureau of Investigation (FBI) in various initiatives. In
    addition, OCRS coordinates with the following entities to combat
    international crime: Strike Force units in the United States Attorneys
    Office (USAO), FBI Organized Crime Unit, Drug Enforcement
    Administration (DEA), Customs, United States Secret Service,
    International Law Enforcement Academy (ILEA), ICITAP, OPDAT, State
    Department, SEC, Department of Treasury's Financial Crimes Enforcement
    Network (FinCen), United States National Central Bureau (InterPol),
    Federal Reserve, Central Intelligence Agency (CIA), National Security
    Council (NSC), Defense Intelligence Agency (DIA), President's Working
    Group on Trafficking in Women and Children, Italian American Working
    Group, Council of Europe/Working Group, Group of States Against
    Corruption (GRECO), and others.
        The AFMLS coordinates with all federal law enforcement agencies
    responsible for implementing the National Money Laundering (ML)
    Strategy and participates in inter-agency working groups designed to
    address money laundering problems and strengthen effective
    international forfeiture efforts, such as the inter-agency working
    group addressing the Black Market Peso Exchange and inter-agency
    efforts to trace, seize, and forfeit criminal proceeds of corrupt
    foreign officials. In furtherance of the ML Strategy, during recent
    years AFMLS, together with the Treasury Department, has coordinated and
    hosted three National Money Laundering Conferences, which provide an
    important forum for United States prosecutors and agents from around
    the country to exchange information and coordinate efforts for
    attacking international, as well as domestic, money laundering.
        AFMLS leads inter-agency efforts with the Departments of State and
    Treasury to develop international sharing agreements with other nations
    and coordinates with them and appropriate law enforcement agencies in
    implementing our international sharing program. AFMLS also coordinates
    with agencies such as DEA on curricula and location for international
    training seminars on asset forfeiture for foreign law enforcement and
    provides instructors to United States law enforcement agency training
    sessions in order to develop sound international anti-money laundering
    and forfeiture techniques.
        The Public Integrity Section has been called upon to represent the
    United States in international fora, including proceedings of the
    European Union, the Council of Europe, the Stability Pact for South
    Eastern Europe, and Global Forum II on Safeguarding the Integrity of
    Justice and Security Officials; issues addressed at these proceedings
    related to transnational crime, election campaign financing, codes of
    conduct for public officials, and other public corruption issues. The
    Section's expertise in developing and implementing international mutual
    evaluation mechanisms is further reflected in its key role in assisting
    State Department analysis and negotiations relating to the development
    of a peer review mechanism by members of the Organization of American
    States and in its coordination of the United States response to the on-
    going evaluation of United States anti-corruption practices being
    conducted by GRECO, the mutual evaluation mechanism associated with the
    Council of Europe's Criminal Law Convention on Corruption.
        The Alien Smuggling Task Force coordinates regularly with the
    Department of State (most notably the Bureau of International Narcotics
    and Law Enforcement), the Department of the Treasury, the Department of
    Commerce, the Office of Government Ethics, and the United States
    Information Agency.
        The TVCS, in cooperation with OPDAT and the Department of State,
    has developed a terrorism fundraising training curriculum for
    presentation to foreign government officials and responds to specific
    investigative requests via Mutual Legal Assistance Treaties (MLATS).
        TVCS is assisting in the formulation of Treasury's new Foreign
    Terrorist Assets Tracking Center (FTAT) and, once FTAT is established,
    will coordinate closely with FTAT on behalf of federal prosecutors
    involved in investigating and prosecuting terrorist financing cases.
        OPDAT develops and administers technical and developmental
    assistance designed to enhance the capabilities of foreign justice-
    sector institutions. In executing its mission, OPDAT coordinates with
    other federal agencies in the development of the inter-agency program
    development process and in ensuring that its activities are consistent
    with those of United States government entities responsible for
    responding to international crime.
    Federal Bureau of Investigation and Drug Enforcement Administration
        FBI executive management provides leadership to international crime
    working groups, and will continue its liaison with other federal
    agencies in an effort to coordinate efforts. With regard to its
    response to international crime, the FBI maintains effective
    communication with the State Department, the CIA, DEA, United States
    Customs Service (USCS), and the United States Secret Service.
        The FBI details supervisors to the CIA and DEA in order to maintain
    its close relationship with these federal agencies. Further, the FBI
    will continue to expand its partnership with the DEA in the Special
    Operations Division (SOD), looking to increase coverage beyond the
    traditional drug trafficking arena into those areas of the world
    currently being dominated by organized crime groups.
        Question. Also, recognizing that considerable law enforcement
    activity to counter international crime occurs in foreign countries,
    how does the Department of Justice propose to coordinate its efforts
    with its foreign counterparts?
        Answer. The Department will continue to seek every appropriate
    opportunity to gain cooperation from other nations in its efforts to
    target international criminals, through a variety of agreements and
    treaties, as well as through face-to-face relationships with its
    foreign law enforcement counterparts. The Assistant Attorney General
    for the Criminal Division, his Deputy Assistant Attorneys General and
    Section Chiefs will continue to meet routinely with foreign law
    enforcement counterparts at home and abroad, in both bilateral and
    multilateral settings. These meetings not only address particular law
    enforcement issues, but also establish and promote personal
    relationships that facilitate future law enforcement cooperation and
    coordination.
        Many components within the Department routinely work closely with
    foreign law enforcement officials in a variety of continuing contexts.
    For example:
    Criminal Division
        OIA handles all international extradition and mutual legal
    assistance cases made by or to the United States. OIA also negotiates,
    brings into force, and implements new extradition and mutual legal
    assistance treaties. In addition, OIA participates in the negotiation
    of other law enforcement treaties, conventions and agreements related
    to international criminal law. In addition, OIA provides technical
    assistance in the form of training to foreign law enforcement
    authorities. Such training is primarily on international extradition
    and mutual legal assistance, but sometimes covers additional subjects
    related to international criminal law. Office attorneys also
    participate on a number of committees established under the auspices of
    the United Nations and other international organizations that are
    directed at resolving a variety of international law enforcement
    problems such as narcotics trafficking and money laundering. The Office
    maintains a permanent field office in Rome.
        Attorneys from OIA and other Criminal Division components routinely
    address visiting foreign officials in the United States in connection
    with such issues as the detection and prosecution of public corruption
    offenses, the investigation and prosecution of election crimes, the
    detection and prosecution of money laundering offenses, and the
    implementing of effective forfeiture procedures. For example, during
    the last few years the Criminal Division has made presentations to
    public officials from Egypt, Japan, Mongolia, the People's Republic of
    China, the Republic of Haiti, the Republic of Latvia, Turkey, Ukraine,
    Vietnam, El Salvador, France, Mexico, Mongolia, the Philippines,
    Poland, the Republic of Fiji, the Republic of Kyrgyz, Pakistan, the
    Czech Republic, Panama, Nigeria, Colombia, Italy, Germany, Australia,
    Canada, Bolivia, South Africa, Northern Ireland, Burkina Faso,
    Bangladesh, the Democratic Republic of Congo, Hungary, Russian
    Federation, Spain, Sri Lanka, and Tanzania.
        NDDS focuses its litigating resources on dismantling and disrupting
    the drug trafficking organizations and their members that import and
    distribute wholesale quantities of drugs in the United States. The
    Bilateral Case Initiative (BCI), which began as a mechanism through
    which the DOJ and Colombian law enforcement conducted an unprecedented
    effort to investigate and prosecute the most significant traffickers in
    Colombia, has now been expanded to other countries in the region.
        With the assistance of the United States Coast Guard and Department
    of State, NDDS is working with select foreign prosecutors and law
    enforcement to ensure that evidence derived from United States maritime
    enforcement activity is transferred in accordance with the host
    country's law to ensure effective host country prosecutions of
    transnational traffickers. In addition, we also provide technical
    assistance to trusted law enforcement organizations in selected host
    countries.
        NDDS represents the Department at international organizations, such
    as the Organization of American States' Inter-American Drug Abuse
    Control Commission and the United Nations' Commission on Narcotic
    Drugs, which address drug trafficking at the international and regional
    levels. These organizations provide for multilateral consultation on
    important issues related to drug trafficking.
        To assist foreign governments and United States officials stationed
    abroad, NDDS also prepares and distributes guidance on international
    law related to drug trafficking. Most notably, NDDS has recently
    updated the Manual for Compliance With The United Nations Convention
    Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances.
        As if May 2001, 28 of the 34 signatories to the OECD Convention on
    Combating Bribery of Foreign Public Officials in International Business
    Transactions have enacted implementing criminal laws, like the FCPA,
    prohibiting such bribery. The Fraud Section, which negotiated the
    Convention on behalf of the Department, has established relationships
    with prosecutors from the other OECD nations which will facilitate
    cooperation and mutual assistance in this area. The Fraud Section has
    also focused on the area of cross-border telemarketing fraud, and,
    since 1997, DOJ has co-chaired the United States-Canada Working Group
    on Telemarketing Fraud. The Working Group, of which the Fraud Section's
    Special Counsel for Fraud Prevention is the co-chair, meets annually.
    At the time of the Cross-Border Crime Forum conducted by both
    countries' law enforcement authorities, we met to review progress in
    relation to the Working Group's 1997 Report, share information on
    developments relating to cross-border telemarketing fraud, and explore
    possible additional cooperative measures.
        The Child Exploitation and Obscenity Section (CEOS) works toward
    obtaining the ratification and implementation of the United Nations
    Protocol to Combat Trafficking, and implementation of the October 2000
    Trafficking legislation. The Section places a high priority on
    coordinating symposia with foreign officials because they develop
    personal commitments and necessary contacts that result in concrete
    advances and pave the way for joint investigations.
        CCIPS coordinates international requests for emergency assistance
    in cases involving electronic evidence because of its subject matter
    expertise. It also receives a steady stream of foreign visitors and
    provides training for foreign officials in both the computer crime and
    intellectual property areas. Finally, CCIPS is a long-time and
    important participant in numerous international processes that deal
    with cybercrime or electronic evidence, such as the G8 High-Tech Crime
    Subgroup, the negotiations at the Council of Europe on a draft
    cybercrime convention, the Organization of American States, the United
    Nations, and so on.
        ICITAP's efforts are focused on increasing the capacity of the
    recipient country to respond to these and other crimes and coordinates
    these efforts through the countries in which the training sessions are
    being held.
        AFMLS coordinates anti-money laundering initiatives with foreign
    countries through the participation in multi-lateral anti-money
    laundering organizations: G-7 Financial Action Task Force (FATF); Asia
    Pacific Group (APG) on money laundering; Eastern and Southern Africa
    Anti-Money Laundering Group; Western and Central African FATF; South
    Africa; Organization of American States/Inter-American Drug Abuse
    Control Commission (CICAD); Council of Europe, Money Laundering Experts
    Group. AFMLS also participates with other foreign governments in anti-
    money laundering cooperative efforts with the banking industry,
    including: Off-shore Group of Banking Supervisors; Bank Secrecy Act
    Advisory Group, and Law enforcement working groups, such as: CUORC--an
    FBI undercover Working Group, White Collar Crime Investigative Team
    (WCCIT)--a cooperative effort with New Scotland Yard; Black Market Peso
    Exchange (BMPE) Working Group and BMPE Multilateral Working Group.
        Each year, AFMLS also sponsors and organizes a regional
    international conference on Forfeiting the Proceeds of Crime through
    which it brings prosecutors and police officials together to discuss
    practical techniques, legislation, and mechanisms to improve
    international cooperation in forfeiture cases. AFMLS participates in
    multilateral negotiations on forfeiture provisions of international
    conventions and on the Forfeiture Sub-Group of the G8 Senior Experts
    Group on Organized Crime (Lyon Group). In addition, AFMLS coordinates
    forfeiture and money laundering initiatives to strengthen our bilateral
    law enforcement relationships, through such efforts as the negotiation
    of forfeiture sharing agreements and the implementation of the
    Bilateral Mexican/United States Drug Control Strategy.
        The Alien Smuggling Task Force works on the United Nations Protocol
    regarding Migrant Smuggling, PDD-9, as it relates to alien smuggling
    and on bilateral or regional agreements.
        The Public Integrity Section (PI) worked closely with the State
    Department to organize the First Global Forum on Fighting Corruption
    and Safeguarding Integrity Among Justice and Security Officials, which
    was held in Washington D.C. in February 1999. The Section organized a
    plenary issue session on law enforcement issues and took the lead in
    preparing a statement of ``Guiding Principles'' in the fight against
    corruption, which were endorsed by the Forum and since have become an
    important component of international efforts to fight corruption.
        PI also participates in ongoing anti-corruption efforts of the
    Council of Europe; the South East Europe Stability Pact; the
    Organization for Security and Cooperation in Europe; the Organization
    of American States; the Foreign Official Corruption Working Group
    (Kleptocracy); and the corruption subgroup of the State Department's
    International Initiative Against Corruption. This subgroup assisted in
    the preparation for the Second Global Forum on Fighting Corruption,
    which was held in the Netherlands in May 2001. Preparations for Global
    Forum III, to be held in Korea in 2003, are currently in the planning
    stages.
        PI provides its international assistance at a number of
    international events, both to assist with the international initiatives
    cited above and to provide training and expertise. The Section's
    Election Crimes Branch also provides international assistance,
    participating in a Department-wide effort to provide enhanced training
    and law enforcement assistance to other nations. For example, during
    the past 2 years Section attorneys have represented the Department at
    international proceedings and training programs in the following
    countries: Turkey, Bosnia, France, Thailand, Hungary, Argentina, Czech
    Republic, Cyprus, Venezuela, Ukraine, Bangladesh, Russia, and Kenya.
        TVCS works multilaterally with the G8, the Organization of American
    States (OAS) and the United Nations in the development of coordinated
    international counterterrorism enforcement strategies and drafting of
    international counterterrorism conventions. TVCS also works bilaterally
    with numerous governments, including the United Kingdom, Canada,
    Australia, India, Israel and others, in developing and implementing
    effective bilateral counterterrorism enforcement strategies.
        OCRS works with its Strike Forces, the FBI and OIA to reach out to
    foreign law enforcement structures to exchange information and obtain
    evidence with OCRS involving international organized crime. OCRS has
    been involved with international working groups seeking to combat
    international organized crime and has been active in working to effect
    laws and international guidelines for dealing with international
    organized crime. OCRS has also provided training and expertise to law
    enforcement groups in other nations.
    Federal Bureau of Investigation
        In an effort to improve the Federal Government's response to
    international crime, the FBI will continue to implement international
    crime control initiatives, such as:
      --Budapest Project.--The FBI/Hungarian National Police Task Force has
            been established in Budapest, Hungary to identify emerging
            Eurasian criminal enterprise threats to the United States and
            to disrupt those enterprises before they can become entrenched
            in the United States.
      --Linchpin Initiative.--In May 1999, Operation Linchpin was
            established to facilitate the sharing of information and
            operational leads, both domestic and foreign, between the law
            enforcement and intelligence community. Linchpin focuses on
            significant international criminal groups (e.g., Eurasian,
            Italian, and Asian organized crime). Several law enforcement
            and intelligence agencies, including the FBI, are involved in
            sharing intelligence at regularly scheduled Linchpin meetings.
      --Project Millennium.--The FBI, along with law enforcement agencies
            from 23 other countries, have provided Interpol with the names
            and profiles of thousands of Eurasian organized crime subjects
            in order to establish a worldwide database that would allow
            participating countries to cross-reference and coordinate leads
            involving Russian and Eastern European organized crime members.
      --United States-Mexico Fugitive Initiative.--An initiative with the
            Department of Justice and the Mexican Government, designed to
            improve procedures for obtaining provisional arrest warrants
            for fugitives that have fled to the United States from Mexico.
      --United States-Canada International Fugitive Initiative.--DOJ,
            including FBI, USMS, and INS, the Royal Canadian Mounted Police
            and the Toronto Police Service, and INS exchange intelligence
            to improve efficiency in locating/apprehending fugitives who
            flee between the United States and Canada.
      --The International Securities and Commodities Working Group was
            established to bring together individuals dealing in
            international markets, primarily through FBI Legal Attaches and
            their counterparts, to discuss ways to coordinate
            investigations effectively relative to United States and
            international financial markets.
      --Plan Colombia.--DOJ is assisting Colombia in developing a
            comprehensive program to investigate kidnaping. This program
            will include the establishment of a Colombian law enforcement
            task force consisting of specially trained investigators. Where
            appropriate, the task force will work closely with the FBI,
            particularly in cases involving United States nationals. DOJ
            has also tasked the FBI with implementing a comprehensive
            training initiative designed to train law enforcement and
            military personnel from Colombia in anti-kidnaping
            investigative methods and procedures.
      --Canadian Eagle is a joint initiative between the Canadian law
            enforcement agencies and the FBI targeting unscrupulous
            Canadian telephone marketers victimizing citizens of the United
            States, particularly the elderly. The FBI is working with the
            Royal Canadian Mounted Police and other police agencies to
            identify, investigate, and prosecute these individuals.
      --The High Intensity Financial Crimes Area (HIFCA) Task Force is a
            Congressionally-mandated approach to addressing complex and
            egregious money laundering conspiracies in a task force
            environment. HIFCAs have been established in the New York/
            Newark, Los Angeles, San Juan, Phoenix, El Paso, and San
            Antonio Divisions. Applications for similar designations have
            been made by the San Francisco and Chicago Divisions.
      --Interpol Project Rockers.--With respect to Outlaw Motorcycle Gangs,
            the FBI participates in the Interpol Project Rockers annual
            conference and take part in the Project Rockers Steering
            Committee. Representatives from Europe, Australia, and Canada
            also participate. The goal of the meetings center on efforts to
            evaluate and strengthen the international cooperation between
            the countries that are affected by criminal activities engaged
            in by Outlaw Motorcycle Gangs and its members.
      --Project Stocar is a joint FBI/Interpol initiative to share and
            exchange data regarding international vehicle theft.
      --Additionally, the FBI is working with seven European nations to
            develop an automated system to connect existing art theft
            databases.
                                     ______

               Questions Submitted by Senator Barbara A. Mikulski
                               judicial nominees
        Question. Since the 1960s, American Presidents have used the
    American Bar Association (ABA) to ``vet'' judicial nominees. Some
    critics have long-criticized this practice, alleging that the ABA has
    become ``too liberal'' and that the ABA only ``approves'' liberal-
    leaning candidates. However, the Bush administration announced that it
    will no longer include the ABA in the nominee review, and has not
    released the judicial nomination process, which prior Presidents have
    done.
        Further, during the Clinton Administration, some Republican
    Senators said that there was no need to fill the vacancies, despite
    overwhelming evidence of backlogged federal court dockets.
        Do you think there is a need to fill all existing federal judicial
    vacancies?
        Answer. The work of federal judges and the federal courts is
    vitally important to the efficient and fair administration of justice.
    There are currently 110 vacancies in the 862-member federal judiciary
    and the Administrative Office has received an additional 54 judgeships.
    I think it is initially important to fill existing vacancies in order
    to improve the administration of justice.
        Question. Can you describe the process that the Bush Administration
    is using? Particularly, what is the role of the Justice Department in
    the judicial evaluation and selection process? What is the role of the
    White House in the judicial evaluation and selection process? Who is
    the ``point person'' at the Department of Justice and the White House
    for judicial nominations?
        Answer. President Bush has announced his intention to fill over a
    hundred vacancies on the federal courts, vacancies which cause
    backlogs, frustration and delay of justice. I have also said that I
    will enthusiastically support the effort to fill quickly the current
    vacancies in the Article III courts with qualified men and women of
    integrity, who are committed to the rule of law, and who reflect the
    diversity of our country. Consistent with historical practice, I and
    other members of the Justice Department will provide assistance to the
    White House in evaluating potential nominees to the federal bench, to
    the extent requested to do so by the President. The Office of Legal
    Policy, headed by Assistant Attorney General, Viet Dinh, coordinates
    the Departments activities with respect to judicial activism.
        Question. As a Senator, you were aware of the ``blue slip'' process
    in the judicial nominations process. Do you favor the blue slip
    process, as it is currently implemented?
        Answer. As a former Senator, I have a deep respect for the Senate's
    constitutional obligation to ``advise and consent'' on judicial
    nominations, as well as for its prerogative to determine how to conduct
    its internal operating procedures. At the President's request, I will
    respect whatever procedure is agreed to by the Senators.
        Question. Did you, or anyone at the Department of Justice, play a
    role in the White House's decision to exclude the American Bar
    Association from its traditional role in evaluating judicial nominees?
    Were you asked to give an opinion on this decision by the White House?
    What is your opinion of that decision? Do you think that any bar groups
    should play a role in evaluating potential nominees to the federal
    bench?
        Answer. My understanding is that the Administration would no longer
    afford the ABA a preferential place in the judicial nomination process.
    The views of the American Bar Association, like those of any other
    interested group or person, will be considered as part of the judicial
    nomination process. I think it is entirely appropriate and valuable to
    the process for the views of any interested bar association, other
    legal organization or other interested group or person to be
    considered.
        Question. The ABA Model Rules of Professional Conduct provide that
    attorneys should voluntarily provide 50 hours of pro bono legal
    services annually to those of limited means. Do you think that this
    should be a criteria for the evaluation of judicial nominees? What
    groups or categories of citizens do you consider as ``those of limited
    means?''
        Answer. The provision of pro bono services by attorneys is a
    valuable and important responsibility. Candidates for judicial office
    should be evaluated on their experience and skills as an attorney,
    their demonstrated commitment to the rule of law, and their
    temperament.
                 community-oriented policing services--``cops''
        Question. COPS was begun by President Clinton in 1994 to put
    100,000 new officers on America's streets, and has provided municipal
    police departments with more than $9 billion in federal funds to help
    put an estimated 85,000 new officers on the streets in six years, COPS
    funds cover 75 percent of police salaries for three years, then the
    local departments pick up the costs. According to several government
    sources, it has made a significant reduction in crime, especially in
    Baltimore City.
        The Bush Administration has severely cut funding for hiring more
    police officers, cut the $408,323,000 dedicated to hiring community
    police officers to $180 million, but all of that must be used for
    school ``resource'' (security) officers.
        Do you have statistics showing that, on average across the nation,
    the crime rate on school campuses is higher than on the streets?
        Answer. The Bureau of Justice Statistics' (BJS) National Crime
    Victimization Survey (NCVS) provides a uniform measure of school crime
    victimization nationwide through the self-reports of a nationally
    representative sample of persons aged 12 or older who indicate that
    they are attending a public or private school. Periodically, BJS
    together with funding support from the National Center for Education
    Statistics (NCES) in the Department of Education, supplements the
    standard NCVS screener and incident forms with supplementary questions
    for those respondents attending school. Supplements on school crime
    have been conducted in 1989, 1995, 1999, and 2001 with inter-
    supplemental years utilizing the standard NCVS instruments to provide
    annual estimates. The most recent BJS data on school victimization
    indicate that:
      --Approximately 14 percent of crime victimizations nationwide
            occurred at a public or private school or on a college campus.
            This is based on an estimated 24,493,550 criminal
            victimizations nationwide in 1999 (excluding residential
            burglaries and all homicides), of which 3,322,775 were
            estimated to have occurred at school (see following table).

                                       SCHOOL CRIME VICTIMIZATIONS--1999 ESTIMATES
    ----------------------------------------------------------------------------------------------------------------
                                                                                                         Est. No.
                              Type of crime                              Number of      Percent at        school
                                                                         incidents        school         incidents
    ----------------------------------------------------------------------------------------------------------------
    Selected personal and property crimes, total....................      24,493,550           0.136       3,322,775
                                                                     ===============================================
    Violent, total..................................................       6,723,930           0.151       1,015,313
    Rape/sexual assault.............................................         381,400           0.052          19,833
    Robbery.........................................................         740,890           0.072          53,344
    Aggravated assault..............................................       1,290,360           0.088         113,552
    Simple assault..................................................       4,311,270           0.192         827,764
                                                                     ===============================================
    Property and other, total.......................................      17,769,620           0.130       2,307,461
    Purse snatch/pocket-picking.....................................         206,090           0.148          30,501
    Motor vehicle theft.............................................       1,068,130           0.016          17,090
    Theft...........................................................      16,495,400           0.137       2,259,870
    ----------------------------------------------------------------------------------------------------------------

      --BJS estimates, for 1998, indicate that there were 43 violent
            victimizations and 58 theft victimizations occurring at school
            per 1,000 students aged 12 to 18. Of these, there were an
            estimated 9 incidents per 1,000 students of serious violent
            crime-rape, sexual assault, robbery, and aggravated assault.
            Per capita estimates of victimization incident rates in 1998
            among students for victimizations which occurred away from
            school grounds were 48 violent, 46 theft and 21 serious violent
            incidents per 1,000 students aged 12 to 18. These data indicate
            that two-thirds of the serious violence experienced by students
            in 1998 occurred away from school grounds. However, over the
            period from 1992 to 1998, per capita rates of violent
            victimization and serious violent victimization of students
            while at school have remained largely stable while the same
            rates for incidents occurring outside of school have declined.
      --NCES reports, based upon data from 1993 through 1997, that teachers
            were the victims of thefts and violent crimes at school at a
            rate equal to 84 incidents per 1,000 teachers.
      --In the 1997-98 school year, the Centers for Disease Control (CDC)
            reported 35 student homicides in public and private schools
            through high school--this would translate into about two-tenths
            of 1 percent of homicides and would obviously not alter the
            aggregate estimates on the attached spreadsheet. Data on school
            homicides are recorded by CDC in partnership with the
            Department of Education.
      --Violent crime victimizations represent 27 percent of total crime
            victimizations nationwide, while property and other crimes
            comprise the remaining 73 percent. For school-related crime
            incidents, about 30 percent are classified as violent. While
            simple assaults comprise about 64 percent of all violent
            victimizations, in schools, simple assault accounts for 82
            percent of violent victimizations.
      --Though simple assault is the least serious violent crime, it is not
            a trivial matter. Such crimes encompass a broad range of
            behaviors from verbal threats, to bullying, to physical attacks
            that result in cuts, bruises, black eyes, chipped teeth, etc.
            The likelihood of injury in simple assault is greater than in
            aggravated assault.
        This BJS analysis is based on data collected through the NCVS,
    which is the nation's primary source of information on criminal
    victimization. Each year since 1973, estimates of crime victimization
    are obtained from nearly 200,000 interviews with a nationally
    representative sample of residents aged 12 or older on the frequency,
    characteristics and consequences of criminal victimization in the
    United States. The survey enables BJS to estimate the likelihood of
    victimization by rape, sexual assault, robbery, assault, theft,
    household burglary, and motor vehicle theft for the population as a
    whole, as well as for specific segments. In contrast to other crime
    statistical programs, like the summary Uniform Crime Reporting Program
    administered by the Federal Bureau of Investigation, which collects
    data on crimes reported to law enforcement agencies, the NCVS includes
    information on crime not reported to the police. This question cannot
    be answered with the FBI's Summary Uniform Crime Report data because it
    does not include sufficient detail on where crimes reported to police
    take place.
        Question. Although the Administration has characterized hiring law
    enforcement personnel as a ``local issue,'' the Federal Government
    provides significant funding for other critical ``local'' issues such
    as domestic violence or community renewal/drug prevention programs such
    as ``Weed and Seed.''
        How do you explain making an exception for the hiring of local
    police officers who are supposed to enforce those other programs?
        Answer. With local expenditures on police and law enforcement
    totaling a projected $52 billion in 2001, it is clear that COPS and
    other DOJ grants play a relatively small role in the overall funding
    picture. However, in light of public concerns about crime in and around
    the nation's primary and secondary schools, the COPS Office will focus
    its hiring efforts on increasing the number of school resource officers
    (SROs) serving in our nation's schools. COPS, through the continuation
    of the COPS in Schools (CIS) program, will provide state and local law
    enforcement agencies an average of $116,000, and a maximum of $125,000,
    per officer over 3 years, to assist in hiring officers who become
    assigned to a school.
        SROs are not required to enforce federal initiatives. Depending on
    the needs of the local jurisdiction, the SROs, funded through the CIS
    program, teach crime prevention and substance abuse classes, monitor
    and assist troubled students, and build respect and understanding
    between law enforcement and students. These officers also assist in the
    identification of physical changes in the environment that may reduce
    crime in and around the schools, as well as assist in developing school
    policies, which address criminal activity.
        To date, through this highly successful program, the COPS Office
    has funded the addition of over 3,700 SROs who serve in their assigned
    schools, and it is estimated that by the end of 2001, the number of
    SROs funded will have grown to approximately 4,600. The $180 million in
    hiring funds requested in 2002 will allow for the funding and training
    of 1,500 SROs. If CIS applications fail to total $180 million, the COPS
    Office will continue to fund up to the amount available, within the
    $180 million, the hiring of general community policing officers by
    providing up to $75,000 per officer over 3 years.
                                     ______

                Questions Submitted by Senator Patrick J. Leahy
                              boys and girls club
        Question. In fiscal year 2001, Congress appropriated $60 million to
    the Boys and Girls Clubs of America for grants to Boys and Girls Clubs
    across the nation within the Department of Justice's programs for state
    and local law enforcement assistance. In Vermont and around the
    country, Boys and Girls Clubs are a proven and growing success in
    preventing crime and supporting our children. What was the rationale
    behind the Administration's decision to not request funding for Boys
    and Girls Clubs within the Department of Justice budget submission.
        Answer. Since 1996, funds appropriated for the Local Law
    Enforcement Block Grant (LLEBG) program have included an earmark
    specifically for B&GCA. To date, the LLEBG program has provided over
    $200 million in resources directly to B&GCA. The $60 million earmarked
    in fiscal year 2001 was 11 percent of the total--slightly larger than
    the combined estimated LLEBG allocations for New York, North Carolina,
    and Georgia. Only California received a larger amount of funding.
        In 2002, the Department made difficult funding decisions, which
    included redirecting existing resources to address basic law
    enforcement operational needs, such as increasing detention and
    incarceration capacity. As a result, some programs, such as LLEBG, were
    reduced. To help maximize the funding available for state and local law
    enforcement agencies, the Department's budget request does not earmark
    any LLEBG funds for specific grant projects or non-federal
    organizations such as the Boys and Girls Clubs, no matter how worthy.
    This same principle was applied to the other Office of Justice Program
    (OJP) grant programs, both competitive and formula-based.
        Question. In 1997, I was proud to join with Senator Hatch, Senator
    Gregg and others to pass bipartisan legislation to authorize grants by
    the Department of Justice (DOJ) to fund 2,500 Boys and Girls Clubs
    across the nation from fiscal year 1998 to fiscal year 2001. Would you
    recommend that Congress authorize grants by the Department of Justice
    for fiscal year 2002 to fund additional Boys and Girls Clubs around the
    country?
        Answer. While the Department of Justice has taken no forward
    position on this bill, it recognizes the importance of the B&GCA, which
    provide millions of at-risk boys and girls with a full and fair
    opportunity to lead productive and meaningful lives.
        Since the enactment of Title IV of the Economic Espionage Act of
    1996, intended to provide $100 million to the B&GCA for establishing
    1,000 additional local Boys and Girls Clubs, Congress has earmarked
    more than $200 million of LLEBG, including $11 million the year before
    the law was enacted. Through 2001, 875 new clubs have been established.
        In addition to the LLEBG funds, nearly $37 million has been awarded
    by OJP from fiscal year 1992 through fiscal year 2001 to B&GCA and
    individual Boys and Girls Clubs through various grants from the Bureau
    of Justice Assistance, the Executive Office for Weed and Seed, the
    Violence Against Women Office and the Office for Juvenile Justice and
    Delinquency Prevention.
        In fiscal year 2002, DOJ has made many difficult internal decisions
    on the use of limited, valuable resources. The LLEBG was reduced so
    that law enforcement operations and federal prisons could be more
    strongly supported, and with that reduction, the B&GCA earmark was
    eliminated. In making these decisions, also considered were DOJ's long-
    standing policy not to re-request Congressional earmarks as part of the
    President's annual budget and the desire to provide maximum flexibility
    to state and local law enforcement agencies in their use of the
    remaining funds.
                   bulletproof vest partnership grant program
        Question. Last year, Senator Campbell and I authored and Congress
    passed the Bulletproof Vest Partnership Grant Act of 2000 (Public Law
    106-517) to authorize $50,000,000 for the Bulletproof Vest Partnership
    Program for fiscal year 2002 within the Department of Justice programs
    for state and local enforcement assistance. In its first 2 years of
    operation, this program funded more than 325,000 new bulletproof vests
    for our nation's police officers, including more than 536 vests for
    Vermont law enforcement officers. The demand for bulletproof vests
    under this program has far exceeded the program's resources. For
    example, last year, state and local law enforcement agencies requested
    more than $80 million in grants under the program's $25 million budget.
    But President Bush's budget requests only level funding for this
    program in fiscal year 2002. What was the rationale behind the
    Administration's decision to request only half of the authorized
    funding level for the Bulletproof Best Partnership Grant Program within
    the Department of Justice budget submission?
        Answer. The Bulletproof Vest Partnership Program is designed to
    protect the lives of law enforcement officers by helping state, local,
    and tribal law enforcement agencies provide officers with armor vests
    that comply with the National Institute of Justice's ballistic or stab-
    resistant standards. The program pays up to 50 percent of the total
    cost of each vest. Participating jurisdictions have 4 years beyond the
    year of the approved application to request reimbursement for
    authorized purchases. At the end of fiscal year 2000 (the second year
    of the Bulletproof Vest Partnership Program), approximately 94,000
    vests had actually been purchased. In 1999, 3,510 jurisdictions
    participated in the program, and 3,586 jurisdictions participated in
    2000.
        Because of the overall funding constraints, not every Justice grant
    program can be funded at its fully authorized level. Most funding
    increases in the 2002 DOJ budget for state and local law enforcement
    assistance are for implementing the President's crime prevention and
    public safety initiatives.
        The 2002 request of $25.4 million is consistent with amounts
    appropriated for the first 2 years of the program. In 2000, $25 million
    was appropriated for the Bulletproof Vest Partnership Program, and in
    2001, $25.4 million was appropriated. Regardless of the funding level,
    the acquisition of body armor is primarily a state and local
    responsibility. By continuing funding at the current level, the
    Department of Justice can continue to assist jurisdictions in the
    greatest need.
                         computer crime enforcement act
        Question. In 2000, Senator DeWine and I authored and Congress
    passed the Computer Crime Enforcement Act (Public Law 106-572) to
    authorize $25,000,000 for fiscal year 2002 within the Department of
    Justice programs for state and local law enforcement assistance. But
    President Bush's budget fails to request any funding for this program.
    What was the rationale behind the Administration's decision to not
    request any funding for the Computer Crime Enforcement Act within the
    Department of Justice budget submission?
        Answer. The Computer Crime Enforcement Act was passed on December
    28, 2000, which was too late in the 2002 budget process to be
    considered in the formulation of the 2002 President's budget. However,
    existing programs assist state and local law enforcement activities in
    deterring, investigating, and prosecuting computer crimes. These
    include:
      --Funding for the National White Collar Crime Center, which provides
            training and support for investigations of computer crimes, and
            operates the Internet Fraud Complaint Center in conjunction
            with the FBI.
      --The Missing Children's Program includes the Internet Crimes Against
            Children Task Force program, which helps participating state
            and local law enforcement agencies prevent, interdict or
            investigate online enticement and child pornography cases.
      --The Bureau of Justice Statistics administers the Cybercrime
            Statistics Program, intended to measure changes in the
            incidence, magnitude and consequences of electronic or
            cybercrime.
      --Byrne Formula Grant funds may be used to support computer crime
            investigation and enforcement activities.
      --The Regional Information Sharing System provides information and
            intelligence services to state and local criminal justice
            agencies, enhancing their ability to identify, target and
            remove criminal conspiracies and activities spanning
            jurisdictional borders.
      --The National Institute of Justice provides onsite and other
            technical assistance to state and local officials on
            investigation and enforcement of cybercrimes.
      --The Computer Crime and Intellectual Property Section (CCIPS) works
            closely with state and local law enforcement agencies to help
            them develop their own abilities to investigate and prosecute
            cybercrime. Moreover, CCIPS has attorneys on duty daily to
            respond to questions from state and local law enforcement
            agencies.
      --The United States Attorneys' Offices are provided resources for
            their Computer Crime and Intellectual Property Initiative to
            prosecute hackers and computer criminals. Each U.S. Attorney's
            Office (USAO) has at least one Computer and Telecommunications
            Coordinator (CTC) investigating and prosecuting high-tech
            crimes. CTCs also provide training to local law enforcement.
              violent offender incarceration prison grant program
        Question. In fiscal year 2001, Congress appropriated $225 million
    for the Violent Offender Incarceration Prison Grant Program within the
    Department of Justice's programs for state and local law enforcement
    assistance. But President Bush's budget fails to request any funding
    for the Violent Offender Incarceration Prison Grant Program. What was
    the rationale behind the Administration's decision to not request any
    funding for the Violent Offender Incarceration Prison Grant Program
    within the Department of Justice budget submission?
        Answer. The Violent Offender Incarceration Prison Grant Program was
    established in 1996 to encourage states to enact truth-in-sentencing
    laws that require violent criminals to serve at least 85 percent of the
    sentence imposed by the court. Federal grant resources were provided to
    build or expand correctional facilities to increase bed capacity for
    the confinement of violent offenders.
        Since 1996, the Violent Offender Incarceration Prison Grant Program
    provided more than $2.3 billion to the 50 states, the United States
    territories and the District of Columbia. In 2000, nearly 24,800 new
    beds were constructed, exceeding the target of 15,000 new beds. At the
    same time, the state prison population is beginning to stabilize.
        To date, 30 states have enacted the required truth-in-sentencing
    legislation. Five years have elapsed since the inception of the
    program, giving states ample time to consider the costs and benefits of
    this legislation, and no state has enacted such legislation since 1999.
    Recent data from BJS also shows that the state prison population has
    begun to stabilize, growing by just 1.5 percent last year.
    Consequently, OJP believes the program has accomplished its mission,
    and no funding is requested for this purpose in 2002.
        However, funds are requested for Indian tribes to construct jails
    on tribal lands ($35.191 million) and for the United States Marshals
    Service Cooperative Agreement program ($35 million) as stand-alone
    independent programs. These had been funded previously under the
    Violent Offender Incarceration Prison Grant Program.
                    enforcing underage drinking laws program
        Question. In fiscal year 2001, Congress appropriated $25 million
    for the Enforcing Underage Drinking Laws Program (EUDL) within the
    Department of Justice's programs for state and local law enforcement
    assistance. But President Bush's budget fails to request any funding
    for this program. What was the rationale behind the Administration's
    decision to not request any funding for the Enforcing Underage Drinking
    Laws Program within the Department of Justice budget submission?
        Answer. Since 1998, $25 million has been earmarked out of the
    Office of Juvenile Justice and Delinquency Prevention's (OJJDP) Title V
    funding for this program. In 2002, the Department was faced with
    internal funding decisions in trying to address basic law enforcement
    needs and other Administration priorities. As a result, entire programs
    or portions of programs were redirected. Within OJJDP Title V, the
    budget process proposes to allocate $37 million to help carry out the
    President's Project ChildSafe pledge, which will make child safety
    locks available for every handgun in America by 2006. When combined
    with funding in the Juvenile Accountability Block Grant program, a
    total of $75 million will be available for this effort in 2002.
        States may choose to direct resources from other OJP programs to
    continue efforts initiated under EUDL. Funds available under OJJDP's
    Part B Formula grants, Part E State Challenge grants, Title V Incentive
    grants, and the Juvenile Accountability Incentive Block Grant (JAIBG)
    program may be targeted for the same or like purposes as EUDL.
                      dna analysis backlog elimination act
        Question. In 2000, Congress passed the DNA Analysis Backlog
    Elimination Act of 2000 (Public Law 106-546) to authorize $65,000,000
    for fiscal year 2002 within the Department of Justice programs for
    state and local law enforcement assistance. But President Bush's budget
    requests only $35 million for this program. What was the rationale
    behind the Administration's decision to request $30 million less than
    the authorized funding level for the DNA Analysis Backlog Elimination
    Act within the Department of Justice budget submission?
        Answer. In 2002, the President's budget includes a total of $70
    million in resources to support DNA backlog activities and crime lab
    improvements:
      --A total of $35 million is requested for activities authorized under
            sections 2(a)(1) and 2(a)(2) of the DNA Analysis Backlog
            Reduction Act of 2000. Of this amount, $10 million is for the
            reduction of the DNA convicted offender backlog and $25 million
            is for the reduction of the DNA backlog in cases that have no
            known suspects. These are sufficient amounts to address the
            population of the national DNA database as private DNA labs are
            not yet able to process a higher level of sample analyses.
      --An additional $35 million is requested for the Crime Lab
            Improvement Program (CLIP), which is an existing program
            authorized under the Omnibus Crime Control and Safe Streets Act
            of 1968. CLIP provides discretionary grant resources to improve
            the general forensic capability and capacity of state and local
            crime laboratories to conduct DNA and forensic analyses.
            Although not specifically authorized under the DNA Analysis
            Backlog Reduction Act of 2000, CLIP resources are available for
            purposes included under Section 2(a)(3) the Act.
      --The fiscal year 2002 budget reflects a decision to provide
            significant funding increases for the existing Crime Lab
            Improvement (CLIP) and DNA Backlog Reduction Programs. Total
            funding for these 2 programs goes from $30 million in fiscal
            year 2001 to $70 million ($35 million each) in the fiscal year
            2002 budget. This represents a 230 percent rate of growth, far
            exceeding that of most other OJP and DOJ programs.
        paul coverdell national forensic science improvement act of 2000
        Question. In 2000, Congress passed the Paul Coverdell National
    Forensic Science Improvement Act of 2000 (Public Law 106-561) to
    authorize $85,400,000 for fiscal year 2002 within the Department of
    Justice programs for state and local law enforcement assistance. But
    President Bush's budget fails to request any funding for this program.
    What was the rationale behind the Administration's decision to not
    request any funding for the Paul Coverdell National Forensic Science
    Improvement Act within the Department of Justice budget submission?
        Answer. The Paul Coverdell National Forensic Science Improvement
    Act was enacted on December 21, 2000, late in the budget formulation
    process for fiscal year 2002. Although the President's fiscal year 2002
    does not request funding for the grant programs authorized by the
    Coverdell Act, it does request more than $70 million to expand OJP's
    initiatives in support of state and local crime laboratories,
    including:
      --$35 million for the Crime Lab Improvement Program (CLIP), which
            provides grants to state and local forensic science agencies to
            improve the quality and timeliness of forensic science services
            offered by state and local laboratories. CLIP funds are
            available for improving all analytical and technological
            resources of public crime laboratories; increasing crime
            laboratory access to specialized forensic services; and
            establishing a network for the allocation of forensic
            capabilities to critical investigations.
      --Another $35 million to address the backlog of state convicted DNA
            and crime scene DNA samples that exist nationwide. The DNA data
            will then be added to the FBI Combined DNA Index System (CODIS)
            database, which provides information that help to solve crimes
            and convict individuals who threaten the safety of our
            citizens.
                           data collection practices
        Question. In compliance with section 646 of the fiscal year 2001
    Treasury-Postal Appropriations law, the Inspectors General of all
    federal agencies were required to submit reports to Congress on each
    agency's data collection practices. A third of the agencies have
    completed their reports and the results are quite disturbing. It seems
    that there are numerous government websites using these tracking
    ``persistent cookies.'' In fact, the Department of Transportation
    announced that it has deleted these cookies after being identified as
    one of the worst offenders. The Department of Justice has not yet
    submitted a report on its data collection practices. Therefore, please
    provide details on the Department of Justice's use of ``persistent
    cookies'' in its data collection practices?
        Answer. In January, the Department of Justice, Office of Inspector
    General (OIG), tested 56 Department internet sites and determined for
    all 56 sites tested, that no Department or third party ``cookies'' had
    been recorded. Based upon this review, OIG issued Audit Report #01-05,
    Review of Department of Justice Internet Sites, dated February 2001
    (attached).
                 Review of Department of Justice Internet Sites
       report no. 01-05, march 13, 2001, office of the inspector general
    Introduction
        Internet sites can be powerful tools to inform the public about
    federal government activities and programs. These sites raise privacy
    concerns when they use ``cookies'', a primary method of compiling
    information and data about Internet users, to track the activities of
    users over time and across different sites.\1\
    ---------------------------------------------------------------------------
        \1\ ``Cookies'' are small software files placed on computers
    without a person's knowledge that can track their movement on an
    Internet site. Essentially, cookies make use of user-specific
    information transmitted by the Internet server onto the user's computer
    so that the information might be available for later access by itself
    or other servers. Internet servers automatically gain access to
    relevant cookies whenever the user establishes a connection to them,
    usually in the form of Internet requests.
    ---------------------------------------------------------------------------
        As a result of recently passed legislation, we are required to
    determine whether Department of Justice (DOJ) Internet sites or third
    parties working for the DOJ collect personally identifiable information
    from users that access DOJ Internet sites. Our review consisted of
    reviewing information provided by DOJ officials and limited testing of
    cookies for the DOJ Internet sites. We did not perform detailed tests
    to verify the information contained in the documentation. Thus, this
    report and the associated work was not performed in accordance with
    Government Auditing Standards (GAS), but was performed as an ``other
    activity of an audit organization'' pursuant to GAS 2.10.
    Criteria
        Office of Management and Budget (OMB) Memorandum M-00-13 (June 22,
    2000), Privacy Policies and Data Collection on Federal Web Sites,
    stated that ``cookies'' should not be used at federal Internet sites,
    or by contractors operating the sites on behalf of agencies, unless
    there was clear and conspicuous notice; a compelling need to gather the
    data; and appropriate, publicly disclosed safeguards for handling
    ``cookie''-derived information. In addition, the memorandum stated that
    the agency head must personally approve the use of ``cookies.''
        The recently enacted Treasury and General Government Appropriations
    Act, 2001 (H.R. 5658, Section 646) (The Act) requires the Inspector
    General of each department or agency to report to Congress:

            any activity of the appropriate department or agency relating
            to--
                      (1) the collection or review of singular data, or the
                    creation of aggregate lists that include personally
                    identifiable information, about individuals who access
                    any Internet site of the department or agency; and
                      (2) entering into agreements with third parties,
                    including other government agencies, to collect,
                    review, or obtain aggregate lists or singular data
                    containing personally identifiable information relating
                    to any individual's access or viewing habits for
                    governmental and non-governmental Internet sites.
    Methodology
        In response to the OMB memorandum and The Act, we assessed DOJ
    written guidance related to web development and privacy policies, and
    prohibitions pertaining to collecting, reviewing, or obtaining data
    regarding individuals using DOJ Internet sites. In addition, on January
    4, 2001, we tested the 56 DOJ Internet sites listed on the DOJ's
    Alphabetical List of Components with Internet Sites (see attachment) to
    determine whether the DOJ or third parties were collecting personally
    identifiable information related to any individual's access or viewing
    habits on the sites. To conduct our testing, we:
              (1) Set the Internet browser to warn us if ``cookies'' were
            being sent, and we cleared the ``cookie'' log to ensure that
            the only entries were those from our test.
              (2) Entered two sites known to set ``cookies,'' msn.com and
            cnet.com, to ensure that the browser warning worked properly
            and the log recorded the ``cookies.'' In both cases the browser
            warned us that cookies were being sent to our computer and
            asked whether we wanted to accept them. We accepted them.
              (3) Examined the ``cookies'' log and, in both cases, the
            ``cookies'' were logged.
              (4) Entered the 56 DOJ Internet sites to determine whether
            they would send ``cookies'' to our computer.
    Results
        DOJ Internet sites tested were not collecting, reviewing, or
    obtaining personally identifiable information relating to any
    individual's access or viewing habits at the time we tested the sites
    for ``cookies.'' For all 56 DOJ Internet sites tested, we were neither
    warned nor asked to accept DOJ or third party ``cookies,'' and, upon
    examining the browser's ``cookies'' log, found that no DOJ or third
    party ``cookies'' had been recorded.
        Currently, DOJ organizations with Internet sites certify quarterly
    in writing to the Assistant Attorney General for Administration that
    they comply with OMB Memorandum M-00-13. This policy, as stated
    earlier, restricts but does not prohibit the use of ``cookies.''
        However, we found no DOJ written guidance related to The Act's
    prohibition on collecting, reviewing, or obtaining personally
    identifiable information relating to any individual's access or viewing
    habits on DOJ Internet sites. While The Act did not specifically cite
    ``cookies'' as the prohibited method, many commercial Internet sites
    use ``cookies'' to do just that when a user accesses their site.
    Currently, DOJ organizations with Internet sites are not certifying to
    The Act's prohibitions on collecting, reviewing, or obtaining
    personally identifiable information relating to any individual's access
    or viewing habits on DOJ Internet sites. Rather, they are merely
    certifying to OMB Memorandum M-00-13's restricted use of ``cookies.''
    In our judgment, the current DOJ certification process should be
    expanded to include The Act's prohibition on collecting, reviewing, or
    obtaining personally identifiable information relating to any
    individual's access or viewing habits on DOJ Internet sites.
                                    appendix
     alphabetical list of doj components with internet sites reviewed for
                                  ``cookies''
        1. American Indian and Alaska Native Affairs Desk (OJP)
        2. Antitrust Division
        3. Attorney General
        4. Bureau of Justice Assistance (OJP)
        5. Bureau of Justice Statistics (OJP)
        6. Civil Division
        7. Civil Rights Division
        8. Community Oriented Policing Services--COPS
        9. Community Relations Service
        10. Corrections Program Office (OJP)
        11. Criminal Division
        12. Diversion Control Program (DEA)
        13. Drug Courts Program Office (OJP)
        14. Drug Enforcement Administration
        15. Environment and Natural Resources Division
        16. Executive Office for Immigration Review
        17. Executive Office for U.S. Attorneys
        18. Executive Office for U.S. Trustees
        19. Executive Office for Weed and Seed (OJP)
        20. Federal Bureau of Investigation
        21. Federal Bureau of Prisons
        22. Foreign Claims Settlement Commission of the United States
        23. Immigration and Naturalization Service
        24. INTERPOL--U.S. National Central Bureau
        25. Justice Management Division
        26. National Criminal Justice Reference Service (OJP)
        27. National Drug Intelligence Center
        28. National Institute of Corrections (FBOP)
        29. National Institute of Justice (OJP)
        30. Office of the Associate Attorney General
        31. Office of the Attorney General
        32. Office of Attorney Personnel Management
        33. Office of Community Dispute Resolution
        34. Office of the Deputy Attorney General
        35. Office of Dispute Resolution
        36. Office of Information and Privacy
        37. Office of the Inspector General
        38. Office of Intelligence Policy and Review
        39. Office of Justice Programs
        40. Office of Juvenile Justice and Delinquency Prevention (OJP)
        41. Office of Legal Counsel
        42. Office of Legislative Affairs
        43. Office of the Pardon Attorney
        44. Office of Policy Development
        45. Office of Professional Responsibility
        46. Office of Public Affairs
        47. Office of the Solicitor General
        48. Office for State and Local Domestic Preparedness Support (OJP)
        49. Office of Tribal Justice
        50. Office for Victims of Crime (OJP)
        51. Tax Division
        52. U.S. Attorneys
        53. U.S. Marshals Service
        54. U.S. Parole Commission
        55. U.S. Trustee Program
        56. Violence Against Women Office (OJP)
     resources for the debt management center and law enforcement support
                                     center
        Question. The detailed Department of Justice budget does not
    provide a breakdown for the Immigration and Naturalization Service
    (INS) Debt Management Center nor the Law Enforcement Support Center
    (LESC). The Debt Management Center, located in Vermont, processes all
    of the debt collections and bond audits for the INS providing
    increasing revenue for the Service.
        The LESC, also known as the National Criminal Alien Tracking
    Center, provides local, state, and federal enforcement agencies with
    24-hour access to data on criminal aliens. By identifying these aliens,
    the LESC alerts local INS offices to initiate expedited deportation
    proceedings. Since its inception in 1994, the Center has received more
    than 120,000 inquiries from law enforcement agencies and identified
    more than 72,000 aliens of which more than 30,000 were identified as
    having criminal records.
        What is the Administration's budget request for the INS Debt
    Management Center and the LESC for fiscal year 2002?
        Answer. The charts below reflect the base level fiscal year 2002
    budget request for the INS Debt Management Center and the LESC. The
    data does not include inflation adjustments requested in the 2002
    request.

    Debt Management Center:
        Payroll.............................................      $3,976,203
        Non-payroll.........................................         529,770
                        --------------------------------------------------------
                        ____________________________________________________
          Total.............................................       4,505,973
                        ========================================================
                        ____________________________________________________
    LESC:
        Payroll.............................................       7,183,574
        Non-payroll.........................................       6,816,426
                        --------------------------------------------------------
                        ____________________________________________________
          Total.............................................      14,000,000
                                     ______

                    Questions Submitted by Senator Herb Kohl
                               project childsafe
        Question. In the President's budget for the Department of Justice,
    $75 million is allocated to Projected ChildSafe--a program designed to
    give away child safety locks around the country. As you know, I've
    offered a bill to make child safety locks mandatory with every new
    handgun sold. At your confirmation hearing, we discussed this issue and
    you reaffirmed to Administration's support for such a measure should
    the Congress pass it.
        I applaud the Administration's interest in child safety locks, yet
    I do have two significant concerns with the program.
        We've recently learned from studies conducted by the Consumer
    Product Safety Commission (CPSC) that most child safety locks fail even
    the most basic tests. For example, the locks are easily picked, or the
    device as a whole falls off if the gun is dropped. Of 32 models tested
    by the CPSC, only two could not be opened with paperclips, tweezers or
    just by dropping them. In addition, in February more than 400,000
    safety locks distributed nationwide by Project Homesafe were recalled
    when tests revealed they were defective. While I strongly advocate the
    mandatory sale of the locks, they won't do any good if they don't work.
        Will Project ChildSafe include standards to ensure that locks being
    given away actually work?
        Answer. The Department is committed to ensuring that any firearm
    safety device distributed under Project ChildSafe meets an adequate
    performance standard. We expect to only provide funds for safety
    devices that meet such a standard. The Department shares your belief,
    and the belief of others in Congress, that the reliability and
    effectiveness of firearm safety devices purchased with public resources
    must be ensured. We look forward to working with you further on this
    important matter.
        Question. Of the $75 million being allocated to this program, half
    is earmarked from Title V crime prevention funds. When Senator Hank
    Brown of Colorado and I created the Title V program almost 10 years
    ago, we intended it to be a crime prevention program that gives
    localities significant flexibility to design ways to prevent juvenile
    crime. We did not intend for the money to be substantially earmarked by
    the Administration. In fairness, the Clinton Administration earmarked a
    much smaller amount of the money, but they made up for it by increasing
    Title V funding generally.
        Please explain why Project ChildSafe should be funded by Title V
    and what you intend to do to make up for the shortfall in prevention
    funding that will result from this earmark.
        Answer. Under the Title V Incentive Grants for Local Delinquency
    Prevention Program, the Department of Justice (DOJ) supports a broad
    range of prevention programs providing a variety of services to
    children, youth and their families, including recreation, tutoring and
    remedial education, work skills, health and mental health, alcohol and
    substance abuse prevention and leadership development. One of these
    prevention programs is Project ChildSafe, a key component of the
    Administration's initiative to reduce gun violence. Project ChildSafe
    will mitigate the risk of death and injury to children by making
    available safety locks for current gun owners.
        The Department believes that this is a very important prevention
    program that does not create a shortfall in prevention funding, but
    instead fills an important need at the state and local level to prevent
    gun-related crimes and accidents among children.
                              prevention programs
        Question. One way to ensure that Project ChildSafe is fully funded,
    yet Title V is still used for prevention programs, as it was intended,
    is to increase allocations to Title V. Studies show that every dollar
    spent on prevention funding yields direct savings of $1.4 to the law
    enforcement and juvenile justice system. Prevention funding should be
    at least equal to the amount spent on enforcement through the Juvenile
    Accountability Incentive Block Grant Program, in other words, $250
    million.
        Please tell me why prevention programs do not receive more funding.
    Please detail what percentage of the Department's overall budget is
    allocated for prevention programs.
        Recently, my office surveyed all of the sheriffs and police chiefs
    in Wisconsin on a variety of law enforcement issues. The survey yielded
    some very helpful insights into what the officers on the font lines
    need from the Federal Government. Local authorities were almost
    unanimous in their belief that the Federal Government needs to increase
    its support for crime prevention programs. On average, the police in my
    state support spending at least one-third of federal money specifically
    on prevention.
        Can you detail your plan for crime prevention programs and pledge
    to increase the resources required to be used for crime prevention
    programs for local police chiefs?
        Answer. The Department of Justice will continue to support the
    efforts of state and local jurisdictions to prevent crime by providing
    national leadership, coordination and resources. The success of crime
    prevention efforts rest in large part on the efforts of state and local
    officials, particularly law enforcement agencies. To this end, the
    Department supports a range of programs and activities and has
    requested increases in several key prevention programs.
        The Department's 2002 budget includes a $25 million increase for
    the Weed and Seed program (for a total of $58.925 million). This
    program assists communities in the development and implementation of
    comprehensive strategies to ``weed out'' violent crime, illegal drug
    and gun trafficking, and illegal gang activity and to ``seed'' their
    communities with crime prevention programs. To achieve this mission,
    the Weed and Seed program provides assistance to sites in designing
    comprehensive strategies to prevent and control crime, coordinates
    federal participation in cooperation with the United States Attorneys
    Offices and federal law enforcement agencies and other federal
    departments, and provides grant funding to communities to further their
    strategies. The additional funding would be available to fund new sites
    as well as special emphasis programs at existing sites.
        The budget also includes an $11 million increase (for a total of
    $73.861 million) for the Residential Substance Abuse Treatment (RSAT)
    Program, which assists states and units of local government in
    developing and implementing residential substance abuse treatment
    programs within state and local correctional and detention facilities
    in which prisoners are incarcerated for a period of time sufficient to
    permit substance abuse treatment. RSAT provides formula grant funding
    to states to assist them in implementing and enhancing substance abuse
    programs that provide individual and group treatment activities for
    offenders in residential facilities operated by state and local
    correctional agencies.
        The Department's 2002 budget also continues to support the Drug
    Courts Program (for which $50 million is requested), which provides
    financial and technical assistance for states, state courts, units of
    local government, local courts, and Indian Tribal governments to
    develop and implement treatment drug courts that employ the coercive
    power of the courts to subject non-violent offenders to an integrated
    mix of treatment, drug testing, incentives and sanctions to break the
    cycle of substance abuse and crime. The drug court movement began as a
    grass roots, community-level response to reduce crime and substance
    abuse among criminal justice offenders.
        Through Project Reentry, a collaborative effort with the
    Departments of Labor and Health and Human Services, DOJ will provide
    grants to assist communities in planning and implementing comprehensive
    reentry programs to address the full range of challenges involved in
    helping young offenders released from incarceration make a successful
    transition back to the community. In order to participate in this
    program, which is in its first year, prospective grantees must
    demonstrate a collaborative effort involving a variety of local
    government and community officials, as well as broad-based community
    support. In fiscal year 2002, $14.9 million is requested to continue
    Project Reentry.
        The Office of Justice Programs (OJP), through its Office of
    Juvenile Justice and Delinquency Prevention (OJJDP), is responsible for
    administering Title V funding, which is dedicated to delinquency
    prevention efforts initiated by a community based planning process
    focused on reducing risks and enhancing protective factors to prevent
    youth from entering the juvenile justice system. The Title V Program
    encourages communities to develop community-wide, collaborative plans
    to prevent delinquency. Each community that participates in the program
    appoints a prevention policy board (PPB) made up of local
    representatives from social services; child welfare, health and mental
    health agencies; law enforcement, private industry; religious
    institutions; and civic organizations. The board assesses the risk
    factors that are putting children at risk and the protective factors
    that are helping keep them safe, then develops a comprehensive system
    of strategies that meets the needs of both children and the community.
    In fiscal year 2002, The Department has requested a total of $94.79
    million for Title V programs, including $12.472 million for the Tribal
    Youth Program, $14.967 million for the Safe Schools Initiative, $5
    million for Project Sentry; $37 million for Project ChildSafe; and
    $30.352 million for Title V Delinquency Prevention Program incentive
    grants.
        The programs discussed above total $292.476 million. The
    President's budget includes $3,639.722 million in domestic
    discretionary funding for state and local law enforcement, and funding
    for the above-mentioned programs represents 8 percent of that amount.
    In addition to these targeted programs, states and units of local
    government may elect to use funding provided through Local Law
    Enforcement Block Grant, the Byrne Formula Grant, and the Juvenile
    Accountability Incentive Block Grant to fund a variety of prevention
    programs.
                                  video games
        Question. Violence in the media returned to the spotlight this week
    with the release of the Federal Trade Commission's first follow-up
    report to its blockbuster findings released last fall concerning the
    marketing of violence to children. This week, Senator Lieberman and I
    also introduced legislation to bar deceptive advertising to children of
    adult-rated movies, music and video games. Since you took office as
    Attorney General, you have been vocal on a number of occasions about
    the need to curb children's access to violent video games.
        As you may know, Senator Lieberman and I have closely monitored the
    video game industry for nearly a decade and have been pleased with the
    progress that we have encouraged. For example, there was no rating
    system at all in 1993. But now, in large part because of Congressional
    pressure, the video game industry has developed and adopted a rating
    system hailed by the Federal Trade Commission as the best in the
    entertainment industry. I hope to see further, significant progress in
    the near tern, and would welcome the opportunity to work with you to
    promote meaningful change.
        What pro-active, cooperative steps do you anticipate taking as
    Attorney General to reduce children's exposure to media violence?
        Answer. The Department of Justice will continue its efforts to
    reduce the exposure of children to media violence by promoting programs
    that help parents control their children's access to such materials,
    that teach children to become more discriminating consumers, and that
    increase the involvement and assistance from professional groups such
    as the medical community who are concerned about the effects of media
    violence.
        Specifically, the Office of Juvenile Justice and Delinquency
    Prevention is continuing to collaborate with the Federal Trade
    Commission (FTC) to help parents understand the media rating systems
    and the importance of monitoring their children's exposure to media
    violence. During the next few months, OJJDP will participate in the
    development, publication, and dissemination of materials based on the
    Federal Trade Commission's study, Marketing Violent Entertainment to
    Children. These materials are specifically geared to parents and the
    general public.
        Another strategy of the Department of Justice is to limit the
    harmful effects of exposure to media violence by focusing on children
    themselves and programs that increase their ``media literacy.'' Media
    literacy refers to critical thinking skills that enable youth to
    evaluate potentially harmful media messages and make better decisions
    on issues of violence and substance abuse in their own lives. Important
    work in this area is being supported by the Office of Juvenile Justice
    and Delinquency Prevention through its ``Delinquency Prevention through
    Media Literacy'' program. This research program is evaluating the
    effectiveness of the ``Flashpoint'' media literacy program, currently
    being offered by the District Attorney for the Eastern District of
    Massachusetts. As Attorney General, I wholeheartedly support an
    approach that directly enhances young peoples' capacity to reject
    violent media messages.
        The Department will continue to expand its partnerships with
    professional associations who are dedicated to improving the safety and
    well being of our children. Plans are currently under way to support
    the work of the American Academy of Pediatrics to develop protocols to
    help pediatricians screen children for exposure to all forms of
    violence, including media violence.
        Question. Last Fall's Federal Trade Commission report regarding the
    marketing of violence to children included a ``Mystery Shopper
    Survey,'' which was funded in part by the Department of Justice. This
    survey gauges the degree to which retailers allow children to purchase
    violent products at their stores. The September report revealed that
    children ages 13 through 16 were able to buy violent, ``Mature''-rated
    video games 85 percent of the time.
        As the Commission prepares to release a follow-up report in
    September, will you commit to continue to fund these important Federal
    Trade Commission' s (FTC) efforts?
        Answer. In the past 2 years, the Department of Justice and the FTC
    have built a strong partnership. The Department's support of the FTC
    study of Marketing Violent Entertainment to Children enabled the FTC to
    broaden its scope of inquiry and for the Department to provide critical
    information to parents and families. We anticipate that this
    collaboration will continue for as long as the need exists and funds
    are available.
                               economic espionage
        Question. Almost 5 years ago, Senator Arlen Specter and I wrote the
    Economic Espionage Act. It created criminal penalties for the theft of
    proprietary economic information. As I am certain you are aware, there
    is a growing market for illicitly obtained company trade secrets. I am
    concerned based on reports that the Department of Justice is not
    placing enough emphasis on the enforcement of this act.
        Please tell me how many prosecutions, indictments, and
    investigations have been launched under the Act and what type of
    resources are being allocated to its enforcement in your budget.
        Answer. The Federal Bureau of Investigation, United States
    Attorneys, and Criminal Division are all actively involved in
    enforcement of copyright laws. Since the enactment of the Economic
    Espionage Act (EEA) of 1996, the FBI has increased the number of theft
    of trade secrets cases it has opened for investigation:
      --On September 30, 1997, approximately 1 year after enactment of the
            EEA, the FBI had 702 pending and preliminary economic espionage
            cases;
      --As of September 30, 2000, the FBI had 751 pending and preliminary
            economic espionage cases--an increase of 7 percent in 3 years.
      --In 2001, the FBI has 626 ongoing pending and preliminary theft of
            trade secrets investigations. On average, over the past 3
            years, the FBI has dedicated approximately 42 field agent
            workyears to address these issues.
        As the number of theft of trade secrets investigations has
    increased, excluding foreign government involvement, there has been a
    corresponding increase in the number of indictments. The Computer Crime
    and Intellectual Property Section (CCIPS) of the Justice Department's
    Criminal Division is a leading proponent of the enforcement of the
    criminal copyright laws against software and Internet piracy. CCIPS has
    an active prosecution caseload of its own and regularly provides case
    support to United States Attorneys Offices nationwide.
      --From 1997 to 1999, 26 of the FBI's theft of trade secrets
            investigations resulted in indictment.
      --In 2000 alone, 27 theft of trade secrets investigations resulted in
            indictment. In other words, more theft of trade secrets
            investigations resulted in indictments in 2000 than in the
            previous 3 years combined.
      --As of May 16, 2001, 14 theft of trade secrets investigations have
            ended with an indictment.
        It should be noted that most defendants indicted as a result of a
    theft of trade secrets investigation are not indicted under Title 18,
    Section 1832, Theft of Trade Secrets. For a number of reasons,
    prosecutors often opt to indict these cases under other federal
    statutes, such as the wire fraud, mail fraud, interstate transportation
    of stolen property and fraud and related activity in connection with
    computer statutes and, in one instance, the federal extortion statute.
        As the number of indictments have increased, so have the number of
    convictions. In every theft of trade secrets investigation that has
    resulted in an indictment, the defendant has either pled guilty or was
    found guilty following a trial.
      --In 1998, 11 of the criminal theft of trade secrets investigations
            resulted in a conviction.
      --In 2000, 18 theft of trade secrets investigations resulted in a
            conviction.
      --Through May 2001, 21 cases have resulted in guilty pleas or guilty
            verdicts and eight are currently pretrial. One case was
            dismissed without prejudice at the request of the government.
        As envisioned, the EEA has served to protect our national security
    and continued economic well-being by protecting trade secrets vital to
    virtually every sector of our economy. Noteworthy EEA prosecutions
    include:
      --One of the first indictments filed under the EEA involved the
            conspiracy and attempt to steal the proprietary information
            about the anti-cancer drug Taxol developed by Bristol-Meyers. A
            district court opinion obligating the government to disclose
            certain trade secret information was reversed by the Third
            Circuit Court of Appeals, ensuring the protection of the trade
            secret. Defendant Kai-Lo Hsu pled guilty in July 1999.
      --CCIPS attorneys brought the first EEA case to trial in the Eastern
            District of Ohio. A Taiwanese company, Four Pillars
            Enterprises, and 2 senior executives secretly hired a research
            scientist employed by the Avery-Dennison Corporation to provide
            Four Pillars with formulas and other proprietary information
            concerning the development of adhesive products. The defendants
            were found guilty of attempt and conspiracy to steal trade
            secrets. Four Pillars was sentenced to a fine of $5 million,
            the maximum fine permitted under the statute.
      --Intel Corporation was the victim of trade secret theft when a
            prototype computer processing unit (CPU) was stolen from one of
            Intel's business partners. It was estimated that the chip
            manufacturer would lose up to $10 million if a rival
            corporation had obtained the prototype CPU before its
            introduction into the retail market. Two men attempted to sell
            the stolen chips, were arrested and pled guilty to conspiracy
            to steal trade secrets. One was sentenced to 60 months
            imprisonment and the other was sentenced to 77 months
            imprisonment, the longest sentence to date in an EEA case.
      --Several weeks ago, two Japanese scientists were arrested and
            charged with stealing cell and genetic materials from a top
            medical laboratory in Cleveland conducting research into the
            cause and potential treatment of Alzheimer's Disease. The
            defendants conspired to transfer these materials to the
            Institute of Physical and Chemical Research, a quasi-public
            corporation in Japan operating under the jurisdiction and
            funding of the Japanese government. Charges alleging conspiracy
            and theft of trade secrets to benefit a foreign government and
            foreign instrumentality are still pending.
        In these and other cases, the Department has acted aggressively to
    enforce the EEA and protect against economic espionage and the theft of
    proprietary information. This statute has been an important tool to
    address computer crime, protect company trade secrets, enforce
    intellectual property rights of businesses and private citizens, and
    protect the economic vitality of the nation. For more information about
    Economic Espionage cases prosecuted by the Department, see the CCIPS
    website at www.cybercrime.gov.
               community-oriented policing service (cops) funding
        Question. To be sure, there is much to like in this budget: for
    example, $35 million is set aside to reduce the DNA sample backlog--
    something I supported for years. However, this same budget trims a
    little too close in other areas.
        Specifically, $247 million is cut from COPS Public Safety and
    Community Policing Grants Program. Of that, more than $228 million will
    be eliminated from the COPS Hiring Program. Your budget justification
    states that: ``Overall, funding in this area will be reduced and
    redirected to other priority areas, notably technology grant
    programs.''
        Although the broader category of Crime-Fighting Technologies
    Program enjoys a $78 million increase--largely directed at programs for
    eliminating the DNA backlog or upgrading crime labs--but, the actual
    COPS Technology Grants program that goes to the local level is cut by
    nearly $47 million.
        This just doesn't add up. A cut is a cut and that's exactly what's
    happening to COPS programs in your budget--both to hiring initiatives
    and technology grants programs.
        The core principle of the COPS program was that a cop on the beat
    is the best way to catch criminals, prevent crime, improve the
    community and enhance the public trust and sense of safety. This
    principle was proven correct given the annual and dramatic drop in the
    crime rate since the passage of the 1994 Crime Act. Academic studies
    also bear this out. While I appreciate the role technology has to play
    in effective crime fighting, a computer is no substitute for a police
    officer.
        How can you be sure that this is the right time to cut the budget
    for hiring more police officers, especially given the growing need for
    them, especially in small towns and rural areas?
        Answer. In 2002, the Department of Justice will target limited
    federal resources to the most pressing needs of state and local law
    enforcement. Because the COPS hiring program has achieved one of its
    primary goals by providing funding for over 100,000 officers ``on the
    beat,'' the fiscal year 2002 request proposes a lower level of funding
    for the direct hiring of state and local law enforcement officers.
    Other COPS programs encouraging the advancement of community policing
    practices, now used by departments serving 86 percent of nation's
    population, will continue at their fiscal year 2001 level.
        In light of public concerns about crime in and around the nation's
    primary and secondary schools, the COPS office will focus its hiring
    efforts on increasing the number of school resource officers. COPS,
    through the continuation of the COPS in Schools (CIS) program, will
    provide state and local law enforcement agencies an average of
    $116,000, and a maximum of $125,000, per officer over 3 years, to
    assist in hiring officers who become assigned to a school.
        Depending on the needs of the local jurisdiction, the SROs funded
    through the CIS program teach crime prevention and substance abuse
    classes, monitor and assist troubled students, and build respect and
    understanding between law enforcement and students. These officers also
    assist in the identification of physical changes in the environment
    that may reduce crime in and around the schools, as well as assist in
    developing school policies, which address criminal activity.
        To date, through this highly successful program, the COPS Office
    has funded the addition of over 3,700 SROs who serve in their assigned
    schools, and it is estimated that by the end of 2001, the number of
    SROs funded will have grown to approximately 4,600. The $180 million in
    hiring funds requested in 2002 will allow for the funding and training
    of 1,500 SROs.
        If CIS applications fail to total $180 million, the COPS Office
    will continue to fund up to the amount available, within the $180
    million, the hiring of general community policing officers by providing
    up to $75,000 per officer over 3 years.
        While the COPS Office has partnered with the nation's largest
    cities, more than 82 percent of our grants have gone to departments
    serving populations of 50,000 or less. Based on its authorizing statute
    (the 1994 Crime Act), the COPS Office in 2002 will continue to be
    required to spend 50 percent of its available hiring funds on law
    enforcement jurisdictions serving populations less than 150,000.
    Therefore, small towns and rural areas will continue to benefit from
    the hiring funds made available through the CIS program.
        Question. What studies and analyses were prepared to lead you to
    the conclusion that cutting this program and emphasizing technology
    over people is the most efficient way to spend the remaining COPS
    dollars?
        Answer. Through the COPS Office's interactions with over 30,000
    grantees, encompassing 12,000 of the nation's 18,000 law enforcement
    agencies, several pressing and urgent concerns surrounding law
    enforcement communities have been identified. The Department, as well
    as the COPS Office, has consistently heard that given the reality of
    limited federal resources, what local law enforcement needs most is
    crime fighting technology. Technology, whether new or enhancements,
    will allow officers to work more efficiently, effectively, and safely
    in protecting our nation's streets and neighborhoods. In addition, as
    part of its ``National Evaluation of the COPS Program,'' the National
    Institute of Justice found that COPS grantees expressed more interest
    in reapplying for the MORE technology grants than the Universal Hiring
    Program grants. The same survey also confirmed that on a dollar-for-
    dollar basis, MORE grants put more officers on the street.
        The Department has responded directly to this need by developing
    the COPS InfoTech program. The COPS InfoTech program, a comprehensive
    technology program, has been designed to provide law enforcement
    agencies with the ability and the capacity to access time-sensitive
    information that is vital to analysis and expeditious investigation,
    apprehension of suspected offenders, sophisticated crime prevention,
    and recidivism reduction. However, unlike previous COPS MORE grants,
    agencies will not be required to track and show redeployment through
    timesavings. This change will make InfoTech grants easier to use and
    administer.
        The COPS Office has a rich history of funding information
    technology systems. Since 1994, the COPS Office has funded several
    thousand state and local law enforcement agencies for information
    technology acquisition and implementation under the COPS MORE program,
    and the fiscal years 1998 through 2001 COPS Technology Programs. These
    projects range from the nation's very largest departments to the
    smallest, and include over 50 multi-jurisdictional or consortia
    projects. The COPS Office's proven track record and success in
    providing information technology funds and its knowledge of the history
    of these systems will provide new opportunities for innovation at the
    urban, suburban, and rural community levels.
        Question. The budget seems to be emphasizing school resource
    officers. What are the criteria for selecting school resource officers
    as opposed to COPS on the beat?
        Answer. In 2002, the COPS Office will continue to provide funds to
    state and local jurisdictions for the direct hiring of law enforcement
    officers. However, in light of the growing concern of crime in and
    around the nation's primary and secondary schools, the COPS Office will
    focus its hiring efforts on increasing the number of school resource
    officers (SROs) serving in our nation's schools. COPS, through the
    continuation of the COPS in Schools program, will provide state and
    local law enforcement agencies an average of $116,000, and a maximum of
    $125,000, per officer over 3 years, to assist in hiring officers who
    become assigned to a school.
        If CIS applications fail to total $180 million, the COPS Office
    will continue to fund up to the amount available, within the $180
    million, the hiring of general community policing officers by providing
    up to $75,000 per officer over 3 years through the Universal Hiring
    Program.
                           law enforcement resources
        Question. Wisconsin is under served in terms of federal law
    enforcement resources. From DEA, ATF, and FBI agents to federal
    prosecutors, Wisconsin significantly trails other states with similar
    populations. Yet, Wisconsin increasingly shares the same law
    enforcement concerns of other states. Over the past year, we added
    eight new DEA agents to Wisconsin--a 50 percent increase over the
    previous allocation. But that's still far less than other states with
    the same population.
        In terms of FBI agents, cities with significantly smaller
    populations than Milwaukee have as many or more agents. Albuquerque has
    half the Milwaukee area's population, yet 28 more agents. Louisville
    has half Milwaukee's urban population, but almost the exact number of
    agents. Buffalo has several hundred thousand fewer residents, but 23
    more agents.
        Similarly, Wisconsin has less federal prosecutors than states of
    similar size. Missouri and Tennessee are about the same size as
    Wisconsin, but enjoy 80 to 90 percent more federal prosecutors.
        Will you review the situation and work with me to address these
    disparities during this budget cycle?
        Answer. There are many factors that influence the decision to
    allocate additional resources. An area's population may be one factor,
    but there are many more factors that weigh into resource allocation
    process at the Federal Bureau of Investigation (FBI), United States
    Attorneys (USA), and Drug Enforcement Administration (DEA).
        Documented crime incidents is the primary factor considered by the
    FBI in determining the allocation of investigative resources. Other
    factors considered are regional characteristics, size of territory,
    number of resident agencies, the office's use of sophisticated
    investigative techniques, historical resource usage, and the presence
    of other law enforcement entities, as well as the region's population.
        The state of Wisconsin's overall onboard FBI agent and support
    personnel complements have increased as follows from fiscal year 1996
    to the current fiscal year 2001, as of May 15, 2001:

    ------------------------------------------------------------------------
                  Fiscal Year                  Agent     Support     Total
    ------------------------------------------------------------------------
    1996...................................         66         58        124
    1997...................................         76         66        142
    1998...................................         75         70        145
    1999...................................         76         70        146
    2000...................................         78         68        146
    2001...................................         81         69        150
    ------------------------------------------------------------------------
    From fiscal year 1996 to the current fiscal year 2001: +15 agents, 22.7
      percent increase.
    From fiscal year 1996 to the current fiscal year 2001: +26 Total
      Personnel, 21.0 percent increase.

        In addition, the United States Attorneys have a formal allocation
    process that is used to ensure each district is given the same
    consideration for receipt of new resources. Population and size are two
    criteria used in the allocation process.
        The Executive Office for United States Attorneys establishes a
    working group composed of select United States Attorneys who examine
    relevant objective criteria and data prior to recommending additional
    resources for their districts. For example, before allocating the
    fiscal year 2001 positions for cybercrime, the working group examined
    statistical information regarding case activity and district-specific
    information for that program area. The district-specific information
    included: caseload and time data by program from the case management
    system, district size, average attorney work week, Assistant United
    States Attorneys workyears per 100,000 population, local/regional
    involvement, previous program related allocations, and law enforcement
    resources in the district which are dedicated to the program area at
    issue.
        In examining the attorney caseload and time data for Eastern
    District of Wisconsin, the cases handled per attorney workyear are well
    within the national average for all districts. Using similar objective
    criteria, the working group recommended an additional attorney for both
    the Eastern and Western Districts of Wisconsin for firearms
    prosecutions.
        The Drug Enforcement Administration (DEA) continues to implement
    additional steps to increase its presence in Wisconsin. The DEA will
    continue to conduct operational assessments to determine areas in the
    country that require the upgrade of existing DEA offices or the
    creation of new offices. These assessments are based on resource
    requests from senior DEA managers, input from state and local law
    enforcement officials, and budget allocations. Currently, DEA maintains
    offices in Milwaukee, Green Bay and Madison, Wisconsin.
        In an effort to address the growing drug trafficking threat in the
    state of Wisconsin, DEA has taken the following actions:
      --Milwaukee Resident Office.--In March of 2000, the Milwaukee
            resident office was upgraded to a district office. The office
            is currently staffed with 12 special agents, and 3 supervisory
            special agents. Of the 12 special agents assigned to the
            Milwaukee Resident Office, three agents are assigned to a High
            Intensity Drug Trafficking Area Task Force (HIDTA). These HIDTA
            agents participate in three separate drug enforcement
            initiatives. One agent is assigned to the Heroin Initiative
            managed by the Wisconsin Department of Narcotic Enforcement. A
            second agent is assigned to the South Side Gang Initiative,
            which is managed by the Milwaukee Police Department. In
            addition, the third special agent is assigned to the Common
            Thread Initiative, which is managed by the Federal Bureau of
            Investigation.
      --Green Bay Post of Duty.--In June 2000, the Green Bay Post of Duty
            was upgraded to a Resident Office. The office is currently
            staffed with 2 special agents and 1 supervisory special agent.
        These changes have resulted in the increase of special agent
    positions in Wisconsin from 15 in 1998 to the current level of 20
    special agent positions.
        In addition to the special agent positions, 19 positions were
    allocated for deputized DEA Task Force Officers in the state of
    Wisconsin. DEA has 6 diversion investigators assigned to offices in
    Wisconsin, who investigate methamphetamine crimes and track the
    precursor chemicals necessary to produce methamphetamine. In an effort
    to address more efficiently the growing drug trafficking activities
    occurring in the northern part of Wisconsin, as well as the cities of
    Minneapolis-St. Paul, Minnesota, the Minneapolis-St. Paul Resident
    Office was upgraded to a District Office on June 21, 2000, resulting in
    the posting of 16 special agents and 21 DEA Deputized Task Force
    Officers. The DEA Minneapolis-St. Paul District Office has
    responsibility for conducting methamphetamine investigations and
    provides support to law enforcement agencies in eight counties in
    northern Wisconsin: Bayfield, Burnett, Douglas, Pierce, Polk, Sawyer,
    St. Croix, and Washburn.
        DEA is in the process of conducting an assessment for deployment in
    Milwaukee, Wisconsin. DEA anticipates the Mobile Enforcement Team (MET)
    deployment for Milwaukee will commence in mid October 2001. The
    Operations Division in DEA Headquarters is expediting the process of
    upgrading the Madison Post of Duty to a Resident Office. A Resident
    Agent in Charge and 2 additional agents will be assigned to this office
    to supplement the 2 agents currently assigned in Madison. This will
    result in a total of 5 agents assigned to the Madison Resident Office,
    which would subsequently allocate more staffing and resources to pursue
    methamphetamine investigations.
        I share your concern that every office be treated equitably in
    terms of the allocation of resources. It is precisely this concern that
    has led to establishing objective review procedures within the
    Department of Justice.
                             antitrust enforcement
        Question. As a ranking member of the Judiciary Committee's
    Antitrust Subcommittee, I was pleased to see that the Antitrust
    Division is scheduled to receive an increase of funding of over $20
    million, to nearly $141 million, for fiscal year 2002. I believe that
    it is vitally important that the Antitrust Division receive sufficient
    resources in order that it be able to carry out its mission to preserve
    competition in today's era of increasing corporate consolidation.
        For what purposes do you propose to use this additional funding?
        Answer. Additional funding is earmarked in the President's budget
    to bolster the Antitrust Division's merger enforcement program which
    has seen a dramatic rise in workload in recent years. The Division has
    worked hard to maintain its effectiveness in the face of a daunting
    number of filings, many of which involve global competitors and
    complex, competitive issues. Although the recent economic downturn has
    slowed merger momentum in 2001, most private sector analysts remain
    optimistic about the long-term health of the merger market.
        Question. Which components and programs of the Antitrust Division
    will receive these funds?
        Answer. The Division will direct additional resources to its
    Preservation of Competitive Market Structure program of which merger
    enforcement is a component part.
        Question. Are there new types of investigations or sectors of the
    economy about which the Division plans to become more active?
        Answer. There are several trends--globalization, deregulation,
    technological advancement, among others--which, taken together, are
    fundamentally altering the United States economic landscape and giving
    rise to new economic sectors, industries, and business practices.
    Keeping up with these changes has been and continues to be a
    significant challenge for the Antitrust Division.
        Increasingly, economic activity, whether initiated in the United
    States or abroad, is global in scope. In fiscal year 2000, 32 percent
    of the preliminary investigations opened in the Division's merger
    enforcement program were international. The size and complexity of
    these deals demand the application of additional resources, not only in
    staff time but also in foreign travel, litigation support, and
    translation expenses.
        Beyond the internationalization of merger activity, many recent
    mergers involve commodities, industries, or competitive issues, which
    are particularly complex and difficult to analyze. In recently
    deregulated industries (e.g., energy, utilities, airlines), there are
    typically significant antitrust issues associated with merger
    enforcement. In others (e.g., information technology, electronic
    commerce, telecommunications), the economic paradigm is shifting so
    rapidly that the Division must employ new analytical tools that allow
    it to respond quickly and appropriately. The Division must be vigilant
    against anticompetitive behavior in the new economy where the Internet
    and cutting-edge information technology are reshaping the way companies
    do business.
        Question. Do you plan to hire additional attorneys, economists,
    paralegals, or other staff, and, if so, how many?
        Answer. The $20 million program increase would cover base
    adjustments and fund an additional 113 positions, including 38
    attorneys and 75 paralegals.
        Question. More generally, how do you see this funding increase as
    improving the Antitrust Division's ability to better perform its
    mission?
        Answer. The Division takes very seriously its mission to promote
    competition in the United States economy through enforcement of,
    improvements to, and education about antitrust laws and principles. The
    funding requested in our fiscal year 2002 budget will enable the
    Division to handle its merger workload faster and more efficiently
    while also maintaining a vigilant stance against anticompetitive
    behavior and practices. The ultimate beneficiaries of the Division's
    efforts are the American consumer and American businesses. We estimate
    that, since fiscal year 1998 when data was first available, the
    Division has saved consumers roughly $13.6 billion through its efforts
    in all three enforcement areas--merger, criminal, and civil non-merger.
    By protecting competition across industries and geographic borders, the
    Division's work serves as a catalyst for economic efficiency and
    growth. Additional funding is needed to enable the Division to meet the
    challenges presented by an increasingly global and technologically
    advanced society and continue to safeguard competition and innovation.
                               ballistics funding
        Question. Last year, I requested that the FBI receive $1.36 million
    to integrate the best features of the FBI's DRUGFIRE system and the
    Bureau of Alcohol, Tobacco, and Firearms Integrated Bullet
    Identification System (IBIS) into one national ballistics imaging
    system, NIBIN. The Conference Report passed last year stated that ``the
    FBI may spend up to $1,364,000 for National Ballistics Integrated
    Ballistics Network (NIBIN) Connectivity.'' The President's budget makes
    no mention of these efforts continuing in fiscal year 2002. Is the FBI
    expending resources to integrate the two different ballistics testing
    systems in the one NIBIN network?
        Answer. The FBI decided in 1998 that it would use Criminal Justice
    Information Services-Wide Area Network (CJIS-WAN) as the national
    telecommunications network for NIBIN connectivity. In December 1999,
    the FBI entered into a Memorandum of Understanding (MOU) with the
    Bureau of Alcohol, Tobacco and Firearms (ATF) to work together to
    implement the new unified NIBIN. Under that MOU, the FBI is responsible
    for installing and maintaining CJIS-WAN connections in all NIBIN
    locations, including approximately 59 ATF-sponsored sites which will
    require CJIS-WAN connections.
        The success of NIBIN depends on the continued installation,
    operation, and support of the CJIS-WAN as the telecommunications
    network over which law enforcement agencies across the country exchange
    evidentiary information in violent crime cases.
        During fiscal year 2001, the FBI is providing for the upgrade of
    existing telecommunications lines, racks, and routers for 130 NIBIN
    sites, fully utilizing the enhancement of $1.4 million received through
    the fiscal year 2001 Justice Appropriations Act. Additionally, the FBI
    is providing for the maintenance of all existing DRUGFIRE systems
    through base funding of $4.1 million, as none of the systems have been
    converted yet to the new unified system.
        Question. Assuming that further resources will be necessary to
    complete this work, will you support further funding to accomplish a
    unified NIBIN network?
        Answer. During fiscal year 2002, the FBI will provide for new
    installations and upgrades of telecommunications lines, racks, and
    routers for the remaining 77 sites and maintenance of all existing
    DRUGFIRE systems. The FBI anticipates spending all of the $1.4 million
    for NIBIN connectivity in fiscal year 2002.
        For fiscal year 2003, it is anticipated that ATF will complete the
    replacement of DRUGFIRE systems. The NIBIN Board has decided that in
    order to provide remote diagnostics and maintenance on legacy DRUGFIRE
    regional databases, certain current DRUGFIRE units should remain
    networked via CJIS-WAN, even after the transition to NIBIN is
    completed. This means that maintenance and user support costs and CJIS-
    WAN communications costs must be paid by the FBI after the transition
    to NIBIN for a select number of DRUGFIRE units.
                                     ______

                  Questions Submitted by Senator Patty Murray
                  border patrol agents for the northern border
        Question. Mr. Attorney General, I want to thank you for coming here
    to explain your proposed budget for the Justice Department.
        I was happy to see you include increases for the enforcement of
    Violence Against Women Act (VAWA) and the United States Attorneys in
    your budget. However, I am concerned about decreases in many critical
    programs, such as Juvenile Justice Programs, the COPS program and
    funding for Indian Country.
        I want to highlight one area of the Department of Justice (DOJ)
    budget that is very important to me and many of my colleagues.
        The Border Patrol protects our nation from the influx of illegal
    aliens, identifies and apprehend criminals, and stops dangerous
    narcotics from crossing our borders.
        Your budget proposes $75 million to fund 570 new Border Patrol
    agents in both 2002 and 2003, and includes further resources for
    technological improvements and intelligence units. I intend on helping
    you secure that funding.
        Mr. Attorney General, I want to call your attention to a serious
    threat--both in terms of our national security and our efforts to stop
    the flow of illegal drugs into our country.
        In recent years, we have neglected the real and growing needs of
    the Northern border.
        Many of us would be shocked to know that our Northern border with
    Canada has only 280 Border Patrol agents for approximately 4,000 miles
    of border. In contrast, the Southwest border has nearly 8,000 agents
    for 2,000 miles. That is 4 agents for every mile in the South compared
    to 1 agent for every 14 miles in the north. The Southwest border has a
    need for Border Patrol agents, and we should not take resources away or
    shift the focus from the difficult situation that exists on the
    southwest border. Along with many law enforcement officers, I'm very
    concerned that international terrorists and drug smugglers are taking
    advantage of our inadequate security at the Northern border.
        Most of the world's most dangerous terrorists groups have located
    ``cells'' of their organizations in Canada to have easy access to the
    United States.
        It is far too easy for terrorists to live in anonymity on the
    Northern border so they can plan their attacks on the United States.
        A year and a half ago, this threat of attack became a reality. In
    December of 1999, a suspected terrorist named Ahmed Ressam, was
    apprehended while trying to enter Washington state through Canada. He
    was carrying 100 pounds of bomb-making supplies, including a
    substantial amount of nitroglycerin. He had rented a room in Seattle
    near where a massive January 1st celebration was planned. A similar
    situation occurred in 1998, where a terrorist was apprehended in
    Brooklyn, New York, who entered the United States through Canada. He
    admitted he intended to conduct a suicide attack in New York.
        Aside from terrorists, the Northern border has also become a major
    drug trafficking area.
        We have been so successful on the Southwest border, that drug
    smugglers have begun to use the Northern border as the preferred method
    of bringing drugs into the country.
        We can no longer allow the Northern border to be neglected. Our
    security and our efforts to curb the flow of drugs are at risk.
        Mr. Attorney General, if we honor your request for more funding for
    border activities, are you committed to providing new agents and
    additional resources for the Northern border?
        Answer. Thank you for your commitment to help secure funding for
    570 new Border Patrol agents in both fiscal year 2002 and fiscal year
    2003. We are committed to bringing needed staffing and resources,
    including the Integrated Surveillance Intelligence System (ISIS), and
    agent support equipment such as night vision goggles, pocket scopes and
    infrared scopes to all the borders of the United States. The Border
    Patrol Strategy for 1994 and beyond remains our blueprint for improving
    management of the border between the ports-of-entry and guides our
    deployment of resources to achieve the deterrence required for border
    control. In accordance with this strategy, we are working toward border
    control in 4 phases.
        Phase I--Control San Diego and El Paso Corridors
        Phase II--Control South Texas and Tucson Corridors
        Phase III--Control Remainder of the Southwest Border
        Phase IV--Control all of the U.S. Borders/Adjust to Flow
        We are currently in Phase II of the strategy. As the Border Patrol
    Strategic Plan has matured, the Border Patrol's strategic efforts have
    been directed to areas of operational focus along the Southwest border:
    Operation Rio Grande (including Operation Hold-the-Line) in Texas,
    Operation Gatekeeper in California and Operation Safeguard in Arizona.
    The preponderance of staffing and resources will continue to be
    deployed to the southwest border through Phase III, where the highest
    levels of illegal entries are occurring. However, we do plan to deploy
    additional agents and technology resources along the Northern border in
    both fiscal year 2002 and fiscal year 2003 to address compelling
    enforcement requirements.
        In addition to the new agent positions being deployed to the
    Northern border in fiscal year 2001, we plan to increase our force-
    multiplying capabilities in 2 additional areas, technology (ISIS as
    mentioned above) and intelligence sharing. ISIS systems are being
    placed in the Blaine, Washington; Buffalo, New York; and Swanton,
    Vermont Sectors. The President's fiscal year 2002 budget calls for
    additional resources along the Northern border for establishing
    intelligence units. We support the request for these additional
    resources and ask that you help us secure this funding.
        Overall, the national strategy has been successful, and we plan to
    follow through with the current phasing of the strategic plan. We will
    continue to monitor the situation along our Northern border and are
    prepared to adjust to any major shift in illegal cross border activity.
        In an effort to maximize the effectiveness of enforcement resources
    along our Northern border, the Border Patrol participates in joint
    federal, state and local cooperative law enforcement initiatives. These
    include Project North Star, the Integrated Border Enforcement Team
    (IBET), and the Canadian Border Intelligence Center.
        Project North Star was established to assist federal, state and
    local law enforcement organizations in counter drug operations along
    the contiguous border of the United States and Canada. The principal
    focus is to encourage and promote liaison between law enforcement
    agencies in both the United States and Canada through the exchange of
    ideas and information. This interaction benefits all participants by
    providing a mechanism for law enforcement agencies to coordinate their
    efforts, minimize conflicts between the various enforcement operations,
    and improve border-wide intelligence sharing, training and strategic
    planning.
        The IBET was developed by our Blaine Washington Border Patrol
    Sector, and brings together law enforcement assets from the United
    States Customs Service, Royal Canadian Mounted Police and the United
    States Border Patrol. These enforcement resources mutually support one
    another in a coordinated effort that maximizes each agency's
    effectiveness in deterring and stopping cross border crime. This
    concept has been very successful in Washington and is being exported to
    other locations along the Canadian Border as well.
        The Canadian Border Intelligence Center (CBIC) is a joint
    intelligence group located in the Swanton Vermont Sector Headquarters.
    The CBIC collects law enforcement sensitive intelligence from a wide
    variety of sources, which is then compiled, analyzed and disseminated
    to federal, state and local law enforcement agencies border-wide in
    both Canada and the United States.
        These joint efforts were recently very successful in controlling
    the border during the Summit of the Americas Conference in Quebec,
    Canada. We believe that the Border Patrol is adequately prepared to
    meet its responsibilities in its overall focus on the Northern border.
    We will not neglect the Northern border in implementation of any of the
    phases of the National strategy.

                              subcommittee recess

        Senator Gregg. The next hearing will be on Tuesday, with
    the Secretary of Commerce, Donald Evans.
        Thank you.
        [Whereupon, at 11:01 a.m., Thursday, April 26, the
    subcommittee was recessed, to reconvene at 10 a.m., Tuesday,
    May 1.]

    DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE JUDICIARY, AND RELATED
                  AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2002

                                  ----------

                              TUESDAY, MAY 1, 2001

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 10 a.m., in room S-146, the
    Capitol, Hon. Judd Gregg (chairman) presiding.
        Present: Senators Gregg, Stevens, Hollings, Kohl, and
    Murray.

                             DEPARTMENT OF COMMERCE

                            Office of the Secretary

    STATEMENT OF HON. DONALD L. EVANS, SECRETARY
    ACCOMPANIED BY:
            BARBARA RETZLAFF, BUDGET OFFICER
            SCOTT GUDES, ACTING UNDER SECRETARY, NATIONAL OCEANIC AND
                ATMOSPHERIC ADMINISTRATION

        Senator Gregg. We will start the hearing.
        We appreciate the Secretary's attendance and thank him for
    his time. We know he has a busy schedule and appreciate his
    taking time out of his schedule to participate in this
    appropriations hearing.
        I will reserve my opening statement. Senator Hollings, do
    you have a statement?
        Senator Hollings. No, thank you, Mr. Chairman. I think we
    can move right ahead and hear from the Secretary.
        Senator Gregg. We would love to hear the Secretary's
    thoughts.
        Secretary Evans. Thank you, Mr. Chairman. I am delighted to
    be here.
        I do have a formal statement that I would ask be inserted
    in the record. I will not bore you by reading that to you.
        Senator Gregg. Absolutely; it will be.
        [The statement follows:]
                     Prepared Statement of Donald L. Evans
        Thank you for the opportunity to appear before you to present the
    Department of Commerce's fiscal year 2002 budget request. Our focus,
    first and foremost, is funding the core missions of the Department and
    its bureaus. Thus, the President's budget request proposes increases
    only in those areas that are critical to promoting economic growth,
    technological competitiveness, trade monitoring and compliance, and
    natural resources management.
        The fiscal year 2002 budget request for the Department of Commerce
    is $4.75 billion, $381 million less than in fiscal year 2001. The
    request includes $97.6 million for adjustments-to-base. We are also
    requesting $9.7 million to restore security funding in each of the
    bureaus. This request will ensure adequate funding to provide
    nationwide security services including guard contracts, background
    investigations, information security, and counterintelligence
    activities.
        Departmental Management (DM) requests $37.7 million to provide
    headquarters policy and oversight for the bureaus. Although no program
    increases are proposed in fiscal year 2002, $4 million in the base will
    fund the following digital department projects: $2.5 million to provide
    real time computer help desk support; $1.25 million to allow for
    digital signature capability on electronic documents; and $0.25 million
    for a voice over Internet protocol pilot that would utilize one
    telephone line for voice and data transmission. These requirements are
    important not only to fully utilize the new technology infrastructure
    funded in fiscal year 2001, but they also allow the Department of
    Commerce to capitalize on cutting edge technologies.
        The DM account contains the first of four major reductions in the
    fiscal year 2002 budget. The President and I strongly believe that
    these reductions are necessary to focus the Department on its core
    missions and to contain the overall spending of Federal discretionary
    programs. In fiscal year 1999, $125 million was appropriated for the
    Emergency Oil and Gas Loan Guarantee Program to assist companies in
    this struggling industry. Loans totaling less than $5 million have been
    made, and oil and natural gas prices have rebounded, thus we are
    requesting a rescission of $115 million. The Emergency Steel Loan
    Guarantee Program was appropriated $145 million, and two loans have
    closed totaling $129.5 million. We are requesting a rescission of $10
    million for this program.
        The Office of Inspector General (OIG) requests $21.2 million. This
    includes a program increase of $0.5 million to increase financial
    statement audits by the OIG. This work will be contracted out, thus no
    additional full-time employees are requested.
        The Economic Development Administration requests a total of $365.6
    million. The Salaries and Expenses (S&E) request is $30.6 million, and
    this includes a program increase of $1.7 million to develop and
    implement the Economic Development Communications and Operations
    Management System, a grants management system that will automate the
    entire grants cycle from needs assessment to performance measurement.
    The Economic Development Assistance Programs request is $335 million, a
    $76 million decrease from fiscal year 2001, and the second major
    reduction requested for fiscal year 2002 in our budget. No funding is
    requested for Defense Economic Adjustment grants, as the last BRAC
    round was authorized for 1995.
        Two of the most important program increases which I am proud to
    endorse in the fiscal year 2002 budget are requested for the Economics
    and Statistics Administration. Of the $62.5 million account request, $3
    million is proposed to continue to improve core statistics including
    Gross Domestic Product and related measures, and $3.5 million is
    proposed to update information technology systems that support the
    provision of key economic data.
        The Bureau of the Census requests $543.4 million, consisting of
    $168.6 million for S&E and $374.8 million for Periodic Censuses and
    Programs (PCP). This appears to be a significant increase over fiscal
    year 2001, however, PCP realized a carryover of $300 million from
    fiscal year 2000 into fiscal year 2001, and this reduced our request in
    fiscal year 2001 for new funding. The PCP request includes funding for
    several critical programs: cyclical increases for the 2002 Economic and
    Government Censuses; planning for the 2010 Decennial; implementing the
    American Community Survey; and redesigning the demographic survey
    samples to incorporate the results of Census 2000.
        The International Trade Administration (ITA) requests $329.6
    million. This funding level eliminates $13.5 million in grant programs,
    however, our request continues full funding for program increases
    provided in fiscal year 2001 for trade compliance and monitoring. Trade
    compliance is my highest priority for ITA, and I intend to focus ITA's
    efforts in this area.
        The Bureau of Export Administration requests $68.9 million in
    fiscal year 2002. This request includes a program increase of $1.6
    million for the redesign and replacement of the Export Control
    Automated Support System, which will enable better and faster decisions
    on license applications to accelerate U.S. competitiveness in global
    markets. An increase of $0.5 million is also requested to achieve
    efficiencies in processing export licenses.
        The Minority Business Development Agency requests $28.4 million,
    and this includes a program increase of $0.8 million for expansion of
    the Phoenix Database. This electronic portal will operate as an on-line
    business information center, and will provide electronic links to state
    and local governments, community development organizations, and
    strategic partners, significantly increasing business and economic
    development activity for the minority business community.
        The National Oceanic and Atmospheric Administration (NOAA) requests
    a total of $3.1 billion. This includes an increase of $136.9 million to
    provide for critical weather warning and forecast services and climate
    research. Within this request is a net increase of $96 million to
    continue the acquisition of NOAA satellites, mainly the joint DOD/NOAA
    National Polar-Orbiting Operating and Environmental Satellite System
    (NPOESS) for weather, search and rescue, and oceanographic products for
    both military commanders and the civil community. An increase of $40.2
    million is designated to continue and expand coastal conservation and
    ocean exploration activities, which will build on the progress that
    NOAA has made to preserve the Nation's coasts and oceans, as well as
    promote undersea missions of science and discovery.
        I want to emphasize that NOAA is requesting a total of $243.8
    million for global climate change activities. Included in this funding
    level is $34.7 million for NOAA's Climate Services Initiative, which
    focuses on enhancing climate observations, supporting carbon dioxide
    research, and climate change assessments. NOAA's contributions to long-
    term atmospheric measurements and research modeling are essential to
    our ability to analyze global climate change. NOAA requests $61.6
    million to support the agency's long-term commitment to the management
    of the nation's marine fisheries, including improvement of the
    accompanying science, management, and enforcement activities. An
    additional $36.3 million is required to maintain NOAA infrastructure,
    including its facilities, vessels and aircraft, and to support other
    program requirements.
        The third major reduction in the Department's request is $149.7
    million for NOAA's Coastal Impact Assistance Fund (CIAF). Created in
    fiscal year 2001 to address the impacts of coastal development in the
    seven states involved in off-shore oil and gas production, we feel that
    this funding duplicates efforts of the Coastal Zone Management (CZM)
    program, in which all 33 coastal states are eligible to seek funds. In
    addition to elimination of the CIAF, NOAA also requests terminations
    and reductions of unrequested projects from fiscal year 2001 of $245.9
    million in order to fund proposed program increases and adjustments-to-
    base.
        The Office of Technology Policy requests a total of $8.2 million to
    continue its activities with the Office of Space Commercialization, the
    National Medal of Technology Program, the Experimental Program to
    Stimulate Competitive Technology (EPSCoT), and the Commerce Science and
    Technology Fellowship Program.
        The fourth major reduction requested for the Department falls under
    the National Institute of Standards and Technology's (NIST) request of
    $487.4 million. The request for NIST focuses on the core functions and
    basic mission of NIST. We propose a decrease of $132.4 million from the
    fiscal year 2001 funding level for the Advanced Technology Program
    (ATP) and the suspension of granting new ATP awards in fiscal year
    2002. Furthermore, NIST proposes to utilize funds made available in
    fiscal year 2001 to pay for prior-year commitments in fiscal year 2002.
    The Department is in the process of evaluating the program to determine
    whether a need still exists for Federal funding to assist U.S. industry
    in conducting applied research and development. NIST is requesting a
    total of $20.9 million for the maintenance and repair of its facilities
    in Gaithersburg, Maryland and Boulder, Colorado.
        The National Telecommunications and Information Administration
    (NTIA) requests $73 million. This includes a program increase of $2.1
    million for the Radio Spectrum Measurement van and suitcase necessary
    for NTIA's analysis of critical new wireless technologies. We are
    requesting a decrease of $30 million in the Technology Opportunities
    Program (TOP), for a total request of $15.5 million. This funding will
    enable NTIA to support approximately thirty new grants to under-served
    communities to demonstrate innovative uses of emerging information
    technologies.
        The Patent and Trademark Office (PTO) requests a total program
    level of $1,139 million, a $100 million increase to manage its growing
    workload. In 2002, patent applications are expected to rise by 12
    percent and trademark applications by 11 percent. This funding will
    enable PTO to recruit and retain examiners and make IT investments to
    improve productivity.
        As previously stated, this budget request for the Department of
    Commerce has been carefully crafted to focus on the core functions the
    American people rely on from this agency. It is the Administration's
    belief that government should reduce discretionary spending, and we
    have done so with a budget lower than the previous year's. Although
    reduced funding is requested, this does not mean our performance will
    follow the same trend. Rather, we will further enhance economic growth,
    technological competitiveness, trade monitoring and compliance, and
    natural resources management, thus ensuring a better quality of life
    for all Americans.
                                     ______

                     Biographical Sketch of Donald L. Evans
        Donald L. Evans was nominated by President-elect George W. Bush in
    December 2000, confirmed by the U.S. Senate, and sworn in as the 34th
    U.S. Secretary of Commerce on January 20, 2001.
        Formerly chairman and chief executive officer of Tom Brown, Inc., a
    large independent energy company in Midland, Texas, Secretary Evans
    oversees a diverse Department with more than 40,000 employees and a
    budget of $5.1 billion. The Department of Commerce exercises broad
    responsibilities for promoting U.S. business development and job
    creation, trade, technology and environmental stewardship of our
    coastal and ocean resources.
        As Secretary of Commerce, Secretary Evans is the voice of American
    business in the President's cabinet, and he represents America's
    business interests around the world. President Bush has described him
    as ``an advocate who carries with him knowledge of trade and proven
    skill as a negotiator.'' He is a key member of the President's economic
    team and his energy task force.
        Secretary Evans has said that he sees the mission of the Department
    of Commerce under his guidance as being ``to create an environment in
    which American businesses and American capital can thrive at home and
    abroad.''
        To this end, Secretary Evans has set out an aggressive agenda, with
    a focus on open and fair trade; e-commerce; accurate and timely
    economic data; sound science; and development of cutting-edge
    technology.
        Born in Houston, Texas, in 1946, he is a graduate of the University
    of Texas where he received a Bachelor of Science degree in mechanical
    engineering and an MBA. His early career included a stint as a
    roughneck on an oil rig in West Texas and work in a steel mill.
        In 1975, he joined Tom Brown, Inc., becoming CEO at the age of 33
    in 1985.
        Active in civic and philanthropic affairs, he served as chairman of
    the Board of Regents of the University of Texas and was a driving force
    behind Native Vision, a program that provides services to some 10,000
    Native American children in America.
        Secretary Evans also has been active in state and national
    politics, most recently serving as Chairman of the Bush-Cheney 2000
    campaign.
        Secretary Evans and his wife Susie have three children and are
    members of the United Methodist Church.

                     overview of secretary evans' statement

        Secretary Evans. I have a few thoughts that I would like to
    offer, and then I would be delighted to respond to any
    questions that you have for me.
        This process has reminded me of my years in the private
    sector. There was always a period each year in the company when
    we would deal with budgeting, and it was an arduous process
    that nobody liked going through, but it always reminded me how
    important the process was, to get your entire organization
    focused on your priorities and your needs and your goals, and
    also reminding the people in the organization that it is not
    your money; it is somebody else's money that you are spending.
    So I think it is certainly a good discipline to go through in
    the private sector and is a good discipline for me to be able
    to go through in these first 100 days, because it has really
    allowed me to get, I think, a greater understanding and depth
    of knowledge as to Commerce and its goals and objectives. I
    would like to compliment Barbara, on my right, who did a
    terrific job of not only taking me through the budget, but the
    entire organization.
        As I looked at the budget that we were presented early in
    the year, I wanted to go back and look at the budget growth of
    Commerce over the last number of years, and I would compliment
    this committee for really putting the Commerce Department on
    very sound footing. If you look at the growth of the Commerce
    Department over the last 11 years, it has been a little over 8
    percent. The growth over the last 5 years has been a little
    over 9 percent, and the growth in the Commerce Department's
    budget over the last 3 years, including the 2002 budget that we
    have offered, is a little over 11 percent. So when I think of
    11 percent growth over the last 3 years or 8 percent growth
    over the last 11 years, I think it has grown at a fairly
    healthy rate. And as I look at the budgets and goals and
    priorities that we have in Commerce, I would say that these
    goals and priorities are being funded.
        The one message that I tried to send throughout the
    Department was the importance of our focusing on our core
    mission, whatever it might be, and any agency, any bureau,
    whatever your core mission is, make sure that that is your
    priority and that that is what is being funded first.
        So with that kind of theme of focusing on the core mission
    and our priorities, I think that what we have presented is a
    responsible and prudent budget, and I think it is there in
    large part of action that you take and this committee has taken
    over the last number of years to make some meaningful increases
    in the budget.
        Let me talk about just a few of the specifics, and then I
    am glad to respond to any questions that you might have.
        In the area of international trade, everybody that I talk
    to when I talk about trade, I talk about it in terms of free
    and fair trade. I try to use the phrase ``level playing field''
    often.
        I do not think there is anything that dispirits and can
    destroy trade more quickly than for there to be an unlevel
    playing field. I do not think there is anything that dispirits
    the American worker more quickly than an unlevel playing field,
    or the American businessman or businesswoman. So I put a lot of
    emphasis on that, because it is vitally important.
        Senator, good morning; nice to see you.
        Senator Stevens. Good morning.
        Secretary Evans. So when I talked about priorities in the
    International Trade Administration, I wanted to make sure the
    resources were there to enforce the agreements and make people
    compliant and enforce our laws. So I was pleased to find out
    that this committee authorized a year ago an increase and had
    the Trade Compliance Initiative, which I think is a very
    important initiative, that is allowing us to add some 60
    employees to focus on compliance and focus on a level playing
    field.
        So I think that is already in the budget, and we are trying
    to fill those positions, but it is a priority that to me is at
    the top of the list, because if you are going to expand trade
    in the world, you had better make sure that everybody is on the
    same playing field, period, end of statement. I just want to
    make sure that we continue to send the signal around the world
    that we are going to be tough when it comes to compliance.
        Export licensing is another very important area, and it is
    an important area because technology continues to move quickly
    and move fast, and one of the problems that our industries have
    had in this country is the delays in issuing a license to
    export their equipment and their software around the world. So
    we have asked for another $2 million to implement an
    information system that would speed up the licensing process
    for export licenses.
        The area of critical infrastructure protection is obviously
    an area that is on everybody's mind inside Government and
    outside the Government. It is an initiative that started a
    number of years ago in Government. Commerce has been charged
    with a big responsibility and is part of the organization that
    is involved in critical infrastructure protection. We have
    three agencies that are within Commerce that are active in it.
    One is the Bureau of Export Administration, which is where we
    have what we call CIAO, which is the management piece within
    Commerce. It relates to the private sector and connects the
    public sector with the private sector to develop policies and
    programs, et cetera. NIST is very involved in it, the National
    Institute of Standards and Technology; they have a team of
    experts that goes around, looking at systems within Government
    to see if they are compliant and have the right systems in
    place to protect their infrastructure. NIST has a research
    program that is connected with this. They have a grants program
    that is connected to this. And then, NOAA also has important
    programs that are part of the critical infrastructure
    protection overall effort.
        But while we have asked for an $8 million increase in this
    whole area, I know it is a subject that is very much on your
    minds, it is very much on our minds, and principally, how it is
    going to be organized going forward. I am sure that we are
    taking a hard look at it within Commerce. We are looking at it
    carefully with the White House in terms of how we think it
    should be structured. It is a very important area, and I think
    Commerce should always play a big role in it just because of
    our connection to the private sector.
        When I come to the area of the Bureau of Economic Analysis,
    which is all part of the Economics and Statistics
    Administration, one of the critical areas that has received
    focus from you, rightfully so, is that the statistics that have
    come out of the Bureau of Economic Analysis have not been on
    the mark or on the money. Specifically, I think the simplest
    example, of course, is GDP. It is my understanding that the
    gross domestic product has been consistently underestimated,
    the growth of it has been, about 50 basis points for the last 8
    or 9 years. And this is something that you recognized before I
    showed up. This is something that has been talked about.
        You started a program a year ago to upgrade our efforts. We
    are asking to continue that; we are asking for another $9
    million to hopefully provide us with the tools, with the
    systems, so that we will more accurately predict what the gross
    domestic product growth is in this country.
        Just to show you the impact of this--and I know that you
    are aware of it, but I will mention it anyway--if you
    underestimate it some 50 basis points, and that gets into your
    budgeting process, it means that you underestimate the budget
    surplus $1 trillion over a 10-year period. The reverse is of
    course true also--if you overestimate it 50 basis points, it
    means that you have overestimated the surplus $1 trillion.
        So it just shows the importance of making sure that you are
    providing as accurate a number as you possibly can for the
    entire budgeting process.
        In the area of technology and NIST in particular, which is
    one of the crown jewels of the Federal Government as far as I
    am concerned--it is just an incredible treasure that we have,
    with an incredible cadre of talented scientists that we have
    there--one of the areas that is important to me, as I have
    already mentioned, is focusing on the core mission. There are a
    couple of really big, important labs that are coming out of the
    ground. One is out of the ground, and another is coming out of
    the ground--the Advanced Measurement Lab that is under
    construction and will be completed sometime, in the next year
    to 18 months. I look at these very vital labs that are being
    built, and I really do not worry about it, but I am mindful
    that we need to have the most modern, state-of-the-art,
    cutting-edge technology inside those labs, because the whole
    purpose of NIST is to be out in front of the industry and out
    on the very cutting edge, have the finest equipment, the finest
    people.
        So I feel confident that I am going to be up here a year
    from now asking for a substantial increase in our budget to
    fund equipment that will need to go in these labs.
        So that is an area of great interest to me and certainly an
    area of my focus. I look at a number of the programs in there--
    I know the MEPs program has been a terrific program working
    with small businesses across America. I looked at a study the
    other day that showed those that had participated in an MEPs
    program and an MEPs initiative had four times the productivity
    of those who had not participated in it. So this is a key way
    to get technology into these small businesses across America.
        Global Climate Change is obviously another area that we are
    certainly very much involved in, and we are asking for the
    funding to spend $265 million on Global Climate Change. That is
    approximately what we have spent this last year. So that is an
    effort which, obviously, we want to continue.
        Inside NOAA, as you have said--this is not my quote--we are
    trying to put the ``O'' back in NOAA. I am one who is very
    excited about the Ocean Policy Commission and what we might see
    from them in the fall of 2002. The oceans simply are
    underexplored, and it is time to take a hard look at that and
    see what we should do to really understand this treasure that
    we have on this planet.
        So I am one who is going to be very much an advocate. I
    would say that within our Department, we are doing it, and we
    have some initiative within our Department, but I think the
    Ocean Policy Commission will give us some good directives as to
    where we need to go with ocean policy and ocean commitment. So
    I am anxious to see that.
        Things that we are asking for in our budget that relate to
    putting the ``O'' back in NOAA include a $60 million increase
    to modernize the fisheries with science and management and
    enforcement. It is one of the areas where it is critical, and I
    hope those are enough funds. We have 110 lawsuits that we are
    trying to deal with out there right now. They continue to come
    in. I am hopeful that if we put some more resources into
    funding the sciences and collecting data and more effective
    management, maybe we can reduce these lawsuits by some degree.
        We are also requesting a $17 million increase in the
    National Marine Sanctuaries. I just mentioned exploration of
    the oceans. We have spent about $4 million this last year on
    ocean exploration. We are asking that we increase that by $10
    million, which would increase it two and a half times, so we
    are talking about, as a percentage, a pretty healthy increase.
    It is time to start understanding that 95 percent of the oceans
    remains unexplored--not underexplored, but unexplored--and it
    is time to begin to explore them.
        Then, we also continue with our commitment to our satellite
    program with the Department of Defense. We have asked for
    another $83 million increase for our NPOESS satellite, which is
    the National Polar-Orbiting and Environmental Satellite System.
    Obviously, this is a very important system for this country, so
    we are asking for that.
        Finally, the only other point I would like to make is a $2
    million request to upgrade our spectrum measurement equipment.
    I was in Boulder about 3 weeks ago and went out to those
    terrific labs--I am sure you have had the chance to go out and
    see them; it was my first chance to see NOAA's lab and NTIA's
    lab and, going through the NIST lab, a chance to see the Atomic
    Clock, but also to see the dinosaur kind of equipment that we
    have to measure spectrum in NTIA. We have a little, old truck
    moving around out there that is 10 or 12 years old, trying to
    measure spectrum interference, which is obviously a critical
    part of what we are doing right now in the management of
    spectrum. We all know how important spectrum is to the future
    of the country. When you look at the role it will play in
    getting information to the people of this country, it is
    important that we get it right as we allocate spectrum in the
    years ahead. So part of that is just bringing in the data to
    understand what spectrum is available to auction and what
    spectrum there is too much interference or there is no
    interference.
        Anyway, getting NTIA the tools to measure this is vitally
    important as we move toward decisions, critical decisions for
    the country, as to spectrum allocation in the years ahead. You
    are like me--before you make decisions, you like to have the
    facts, so that is the role that NTIA can play, is helping
    develop the facts as we try to make these critical decisions.
        Again, thank you for getting the budget and the Department,
    quite frankly, into the kind of condition it is in. It has had
    some nice increases over the last number of years. I think the
    budget is sound. I think there are a number of areas that
    certainly can continue to be focused on. I have committed to
    Senator Hollings that I am going to take a hard look at ATP. It
    is a program that has had some tremendous successes over the
    years, saving industry hundreds of millions of dollars. In our
    budget what we have asked for is to use the funds that have not
    been committed yet on grants this year to roll over to next
    year to fund the mortgages on grants that have already been
    granted, while during that period, I am going to take a real
    hard, honest look at ATP and see what kind of role it can play
    going forward.
        Senator, good morning.
        Senator Murray. Good morning.
        Secretary Evans. Let me stop there. Thank you all again. I
    thank all of you; I had a chance to get by to see you and talk
    to you, and I thank you for your help and your support and
    would be glad to answer any questions that you might have or
    listen to whatever you want to tell me.
        Senator Gregg. We appreciate that very comprehensive
    statement, Mr. Secretary. You touched on a lot of areas in
    which the committee has a very significant interest and has
    pursued rather aggressively.
        It is the tradition of this subcommittee to acknowledge the
    chairman of the full committee whenever he decides to come by,
    which we appreciate he does often, and yield to the chairman
    for a statement or questions.
        Senator Stevens. I will just wait my turn, Senator.
        Senator Gregg. Do you have any questions?
        Senator Stevens. Not now, thank you.
        Senator Gregg. Okay. Senator Hollings.

                      noaa discussion by senator hollings

        Senator Hollings. Well, my immediate reaction is
    ``Whoopee,'' Mr. Secretary. That is, as the chairman said, a
    very comprehensive grasp of the role and responsibilities of
    the Secretary of Commerce. You are off and running, and I am
    just enthused to hear you, because other secretaries usually
    come up and everything is sort of foreign to them, and they are
    flipping pages and everything else, and do not know what the
    devil they are saying. Obviously, you do, particularly with
    respect to putting the ``O'' back in NOAA, the ocean
    exploration.
        So you will understand, NOAA was created as a result of a
    very, very thorough study, and President Bush is going to
    revisit that study here with a new commission. Thirty-five
    years ago, Julius Stratton of MIT brought your Texas crowd
    together, the oil people, the Coastal Zone people, the energy
    folks, Coast Guard and everybody else, and they recommended,
    actually, an independent agency of oceans and atmosphere headed
    by the Coast Guard. President Nixon was disappointed and
    tickled, said they would never give him anything like that over
    in Interior and they were not going for an independent agency--
    so he gave it to Commerce and Maurice Stans. NOAA has been at
    Commerce, and different Secretaries have come along and in the
    main disregarded NOAA--although it is 40 percent of my budget--
    let somebody else handle it; get rid of the NOAA fleet, get rid
    of the NOAA corps, the environmental side, services
    administration, and so on.
        So we have had a very difficult time, and to see an
    increase in ocean exploration is heartwarming. But mind you,
    Senator Stevens and I are on the authorizing Committee on
    Commerce, Science, and Transportation, and in space science
    there is $14 billion for exploration, and research is $7
    billion, or one-half of that $14 billion.
        So you are putting up $14 million and talking about a 200
    percent increase--that is tommyrot. The truth of the matter is
    we have got to play catch-up ball, and you have the grasp of
    it. We see that the ocean temperature has increased some
    eleven-hundredths of a percent over the 50-year period, which
    means there is a tipping margin there to be studied and
    determined, because that degree of ocean warming is the
    equivalent of 15,000 years of electricity, and if it tips over,
    global warming will go way beyond any control whatsoever.

                  level playing field for international trade

        Good. Otherwise, on trade, first, let me commend you,
    because it is tough on compliance, and I would not have to say
    anything else on trade--that is all we need, but do not look
    for a level playing field. I have always said I would take the
    Japanese trade book or the Korean trade book and administer our
    trade policy that way, and we would fill up the country with
    production. I cannot sell textiles in downtown Seoul, Korea
    unless the local textile industry votes and approves for me to
    come in--and they just do not. And you cannot sell in Japan.
    They get outsourced to Japanese companies that they have
    organized down in Malaysia and Thailand.
        So it is not level. It is a proposition, frankly, of the
    security of the country. It is like a three-legged stool. One
    leg of our security, value, is unquestioned. The second leg of
    our security is the military, which is unquestioned. The third
    leg, the economic leg has been intentionally fractured in the
    sense that in order to spread capitalism--and it has worked--we
    have given up the textile industry. I remember a hearing I had
    40 years ago, and Tom Dewey was the lawyer for the Japanese,
    and he was racing me around the hearing room saying,
    ``Governor, what do you expect them to make? Let us make the
    airplanes and the computers, but let them make the shoes and
    the clothing.''
        My problem is that they now make the shoes, the clothing,
    the airplanes, the computers, and everything else.
        President Kennedy put out a seven-point program--he had to
    comply with the national security provision that the President
    had to first determine that the item was important to our
    national security. They had the Secretaries of Defense and
    Commerce come in, and they brought in the witnesses--I can see
    Doug Dillon, Secretary of Treasury, there now at the hearing--
    and they determined that next to steel, textiles was the second
    most important item, because we could not send them to war, as
    they said at that time in a Japanese uniform, but now we can
    say we cannot send them to war in a Chinese uniform.
        So there it is. To go immediately to your Bureau of
    Economic Analysis, the Advanced Measurement Lab and so forth,
    will you see if you can find out statistically the amount of
    U.S. consumption represented in imports, generally. I received
    from the Secretary of Commerce in 1975, 1976, 1977, 41 percent
    of our imports were U.S.-generated overseas and brought back
    in. Now, everybody is moving their manufacturing, because it is
    10 percent of the cost of labor here in this country, so they
    are all running down to Mexico. I have lost 42,500 jobs in
    South Carolina alone--I do not know how many jobs have been
    lost in New Hampshire--and it is 500,000 over the country--and
    they are all Republicans, so let them go. But they are good
    jobs, and before long, I will not have any of them left. And
    they just shrug their shoulders like it means nothing, but it
    is very, very important to our economy. We are going to have to
    be able to produce a certain amount of basic electronics,
    clothing, and different things of that kind.
        In fact, Senator Stevens and I are going to get together on
    a national defense measure along this line to reinstitute that
    security provision for the President and aim our trade policy
    along that line. Otherwise, before long, we will go the way of
    England, with a bunch of Parliamentarians and scandal sheets.

                       contract for noaa research vessel

        With respect to the fleet itself, we need that money for
    the research vessel. I tried to check on it earlier this
    morning. We tried to contract with the Navy for the small
    boats, and they refused. Maybe you can get the Navy now, with
    this administration and talk to them over there and see if they
    cannot get the contract for us. But when they get that small
    boat contract, and the contractor knows there are going to be
    two or three research vessels, you can get it at a cheaper
    price. For only one small boat, you disturb the flow of the
    contract and the cost itself on the number one vessel. The
    company tells me they are going into bankruptcy down in
    Mississippi. So we have got to check on that.

                                textile research

        With respect, Mr. Secretary, to the research, we have a
    little bit of research with the National Textile Consortium, $3
    million and $9 million for the Textile Clothing Technology
    Corporation. We actually put in way more for California prunes.
    You ought to see the nonsense we go through with these farm
    boys. Having lost 500,000 textile jobs, to try to hold on to a
    sort of quality basis--and improvement; they get better cloth
    and so on. You have got to be able to manufacture webbing and
    parachutes and everything else. It is a defense measure as
    well. We ought to continue that. That is a tiny bit, $9 million
    and $3 million.
        Senator Gregg. Can't you manufacture clothing out of
    prunes?
        Senator Hollings. Oh, they have put in I do not know how
    much, to sell wine and prunes and so on, in California. That
    California crowd, they have votes.
        Senator Gregg. Not on this committee.
        Senator Hollings. No. That is right--but we are doing
    better--we have Herb with us now.

                          advanced technology program

        On ATP, any time you suspend this thing, they say they are
    going to study it. So after meeting with you yesterday, I have
    found that there are 21 General Accounting Office studies; we
    have had 18 Office of Inspector General studies; we have had
    two National Academy of Sciences studies; one Secretarial 60-
    day review and a report to the Congress--they are really trying
    to kill the program with studies. I hope Rumsfeld is not doing
    that with defense. I do not think he is. Can't you use all of
    these studies as a precedent and build ATP up with these
    studies? That is what we really need to do, because it has
    gotten a little off-course with respect to risk--we are not
    paying for high risk. What we are paying for, and the
    fundamental of this particular Advanced Technology Program, is
    to commercialize technology, discovered and researched here in
    the United States, and where we ought to bring it to market.
    But when you get these quarterly reports that these big moguls
    put in, that includes long-range financing, which is the global
    competition with Japan, for example, and we have nothing but
    short-range financing here in the United States. So ATP would
    move into that gap and make sure that, in part, it is not pork.
    We had the project on a competitive basis in your Department,
    but it was first reviewed by the National Academy of
    Engineering. So all of these ATP reports are good. I have not
    been able to find a bad report yet--but they keep on studying
    it. Do you see what I am saying?
        Secretary Evans. Yes.
        Senator Hollings. So if you would look at that very closely
    for us, please.
        Secretary Evans. Yes.
        Senator Hollings. Thank you very much, Mr. Chairman.
        Senator Gregg. Senator Stevens has a couple of questions.
        Senator Stevens. Thank you very much.

                         research on steller sea lions

        Mr. Secretary, as I told you when we met, I was very
    pleased with the briefing that we got from Dr. Andrew Treitz of
    the North Pacific University's Marine Mammal Consortium. This
    Consortium includes all of the universities of the North
    Pacific. They made some very preliminary conclusions concerning
    the decline of the Steller sea lion.
        We provided moneys last year--and you have a $40 million
    request in this budget--for continuation of the Steller sea
    lion research. We are hopeful that that will proceed and that
    we will use the data that is being collected now as a basis for
    a new biological opinion regarding the Steller sea lion.
        I would encourage you to get the preliminary conclusions
    from the Marine Mammal Consortium from the universities and try
    to see what we can do to head off another collision as far as
    the Steller sea lions are concerned.
        As you know, probably more than 50 percent of our people
    make their living off the sea. We have half the coastline of
    the United States, as these people have heard me say that too
    often. But there is no question of the importance of fisheries
    in our State. We had a very difficult time last year trying to
    prevent the closure of a substantial portion of our fisheries.
        So I would hope that we could get your assistance and that
    of your Department to pursue this science with real enthusiasm
    to make sure we have the science to support the theories rather
    than the theories before the science, in terms of what is
    causing some of these problems. There is no question that the
    Steller sea lions are declining. The question is what can we do
    to reverse it and to what extent will it impact the fisheries
    of our State.
        I hope that you and others can spend some time on that this
    year.
        Secretary Evans. Indeed, we will, Senator. As you said, we
    had a good discussion about this yesterday and several other
    times I have been to see you and visit with you about it. As
    you know, Bill Hogarth, our Acting Assistant Administrator of
    Marine Fisheries was up in your State for 4 or 5 days, and we
    have obviously given it high priority. You mentioned the
    dollars that we have committed to it. I was interested to learn
    what the universities are learning about this very issue.
        We will look at those studies, and we will incorporate them
    into our study of the issue as well. But yes, it is high
    priority for us.

                   comparison of wild and farm-raised salmon

        Senator Stevens. Salmon is probably our greatest resource,
    yet we seem to constantly be at odds with people from the
    Pacific Northwest on the salmon issue. There is a new wrinkle,
    though, coming now. I understand the President is going to
    recommend a new Free Trade Zone for South America. Chile is now
    providing, I think, up to 90 percent of all salmon sold in our
    supermarkets in this country. That was not the case 10 years
    ago.
        We do not think too much of that product, frankly. It is
    farm-raised salmon, and it does not contain the high levels of
    beneficial substances, like Omega-3, and it does not have the
    naturally high levels of other materials found in wild salmon.
        I do not know what we can do to assist our people compete
    with products from South America in competing if a Free Trade
    Zone concept becomes a reality.
        I would just mention that. I do not know the answer, but I
    do think there has to be something done to distinguish between
    the farm-raised salmon and the wild salmon that comes from the
    Pacific Northwest and off Alaska.
        We have the studies on the beneficial effects of
    consumption of salmon for heart disease and other human needs.
    There are not similar benefits as far as this farm-raised
    salmon from South America is concerned.
        I would hope that in this process, we can find some way to
    at least require labeling of origin. When you go to the
    supermarket now, and you see salmon, it does not say where it
    is from. It does not really say what it is. It is not wild
    salmon. Most people who buy it probably think they are buying
    salmon from the oceans, when in fact they are buying farm-
    raised salmon, and it is a different product.
        I hope that you will help us keep an eye out for what we
    might do to protect a basic resource of the North Pacific,
    which is the salmon.
        Lastly, Mr. Secretary, I want to say that you have had some
    real competent help in Bill Hogarth and Scott Gudes and others
    who have kept the fires burning down there, and I want you to
    know that we appreciate what is going on. The budget is a good
    budget as presented to us now. We do not have some of the
    wrinkles that we have had in other departments that we are
    dealing with in this committee. I think you have really got a
    budget that we can all work with and be proud of. I know there
    are several items in there for Alaska, but I am not going to
    discuss those now.
        I just want to urge you to realize the quality work that
    has gone into this before you came on deck. They are good
    people down there who have been working with us over the
    years--they are career people. We appreciate what they have
    done.
        Secretary Evans. Thank you, Senator. So do I; I appreciate
    every one of them, and I could not agree with you more. There
    are some real quality people throughout Government and in the
    Department I have the pleasure to serve in.
        You told me something I did not know, and I am going to
    look into it. I am one of those who has been buying salmon,
    eating salmon, and thinking there is Omega-3 in it, because I
    have high cholesterol, and I want to make sure that I am taking
    care of my cholesterol issue. I did not realize that farm-
    raised salmon does not have Omega-3.
        Senator Stevens. Actually, Dr. Castelli from Dr. Treitz'
    institute up in New England is the one who worked with us for
    so many years and developed all the information about wild
    salmon. We have relied on him quite heavily in terms of advice
    about Omega-3 and the beneficial effects of salmon for people
    who have heart problems.
        Senator Gregg. You hang around this committee, Mr.
    Secretary, and you will learn more about salmon than you ever
    wanted to know.
        Secretary Evans. I learned something new this morning, I
    will tell you.
        Senator Hollings. You can count on it. Get together with
    the Senator on Chile, because that is one big headache with
    respect to free trade. I think you can pass free trade with
    Chile by itself, but one caveat is salmon, and the other is the
    wine, with the California vote.
        Senator Gregg. Did you want to comment on any of the points
    made by the first two Senators?
        Senator Hollings. I agree with Senator Stevens. It is an
    outstanding presentation.
        Senator Stevens. I do not have any questions.
        Senator Gregg. If you do not get questions, it is better
    just not to answer.
        Secretary Evans. Okay.
        Senator Gregg. Senator Kohl.
        Senator Kohl. I welcome you here today, Secretary Evans.
        Secretary Evans. Thank you, Senator.
        Senator Kohl. I would like to first comment briefly on your
    budget officer, Barbara Retzlaff. She has done a tremendous
    job, and I have been very impressed with her knowledge on a
    broad range of issues.
        Barbara worked with me for a couple of years, and try as
    hard as she did, she could never get me up to your speed. I
    think that if you asked her, she would say that she had better
    material to work with in you.
        Ms. Retzlaff. Senator Kohl, it is nice to see you.
        Senator Kohl. Now, I would just like to comment on NOAA. As
    important as it is to the Atlantic and Pacific Coast States, it
    is equally important to the Great Lakes States, because the
    Great Lakes have the largest number of miles of any of the
    States, including the Atlantic and the Pacific. So the issues
    of fisheries, and pollution hydrology, and invasive species are
    programs that NOAA gets involved in, and they are just as
    important to the Great Lakes States as they are to the Atlantic
    and Pacific Coast States. So it is good to hear that you are so
    interested and that you intend to pursue NOAA as vigorously as
    you are going to.

                            northeast dairy compact

        I would just like to raise two issues with you. Number one
    is the Northeast Dairy Compact, Mr. Secretary. It is an
    interstate trade issue, and I would like to get your thoughts
    on it, whether you have any familiarity or some familiarity
    with these dairy agreement. They are agreements among States to
    artificially set and support milk prices. In other words, they
    eliminate the opportunity for any of the other States to
    compete in those compact States by setting an artificial price
    above the market that coops pay farmers in those States for
    their milk; and if you want to send your product into that
    State to compete, you have to do it at that price that they
    set, which effectively eliminates any opportunity for
    competition.
        Now, as you might imagine, listening to this description,
    which is brief but fairly accurate, it is like nothing we have
    ever done in this country before. The greatness of our economy,
    the greatness of our capitalist system is that, without any
    exception since this country was incepted, goods and services
    compete freely from one State to another. We have never before
    erected barriers.
        But the Northeast Dairy Compact, which I think includes
    seven New England States, is subject to termination this year
    unless it is renewed. Now, I know how strongly you and your
    administration feel about free trade and how important it is,
    not only globally, but here in this country. If this Northeast
    Dairy Compact is basically as I have described it--and I
    believe you will find that it is--I would like, if I could, to
    get some opinion from you about what you and your
    administration's position will be on that Northeast Dairy
    Compact this year, as it is subject to renewal.
        Secretary Evans. Senator, let me say that it is not
    something that I have looked at in great detail. I am certainly
    not in a position to tell you at this moment what our
    administration's position will be, but I will tell you that I
    will get that to you.
        [The information follows:]

                Administration Policy on Northeast Dairy Compact

        While the Administration is continuing to operate under the
    existing agreement, they are also reviewing the policy.

        Secretary Evans. This issue was first brought to my
    attention by Governor Ventura. I was talking to Governor
    Ventura about free trade and fair trade, and he brought up the
    issue of this dairy compact, and I responded by saying to him
    that, yes, it is awfully tough for us to talk about free trade
    and a level playing field around the world if we do not have
    one in our own back yard.
        I am one who spent his career in the oil and gas industry,
    and I saw some similar kinds of practices inside the oil and
    gas industry. I am not sure the analogy is a great one between
    the dairy compact and the oil and gas industry, but my point
    would be that I saw the oil and gas industry could get special
    treatment from time to time that would benefit one group of oil
    and gas investors or companies to the detriment of another
    group of oil and gas investors in the same country. So I do not
    understand that principle, and if the principle is similar--one
    group of individuals milking cows and another group, and there
    are different rules--then, I would say it is something that we
    have got to take a hard look at.
        And I am one who believes that we have a free enterprise
    system here in America, it is free and open competition, we are
    all going to play on the same playing field, and if you are the
    low-cost producer, you survive. If you are not, then you need
    to find something else to do in this great economy. And there
    is much to do. We have a wonderful economy here in this
    country. Unemployment is 4.2 or 4.3 percent, and it is growing
    and growing.
        Anyway, the principle I understand. The specifics of what
    the administration policy is going to be on this expiring
    compact, I will get you a response.
        Senator Kohl. That is good to hear. The greatness of our
    economy is attributable in large to the principle you have just
    enumerated, which is that competition is what makes the economy
    as good as it is, competition is what enables us to bring the
    best products at the best prices to consumers here and around
    the world. The minute we set up barriers to competition, we do
    great damage to the American economy. And that is what the
    Northeast Dairy Compact is.
        In fact, I understand that there is an effort under way to
    expand it to 10 or 20 other States, and I would like to hope
    that this administration would take a very strong position
    against that kind of mechanism.

                               export-import bank

        The other thing I would like to raise with you, Mr.
    Secretary, is the Export-Import Bank. As you are well aware,
    the importance of exports continues to grow in our economy. It
    is now estimated that exports account for nearly 30 percent of
    our economy, up from 10 percent in 1950. The Export-Import Bank
    has played a vital role in supporting the continued growth of
    U.S. exports and the workers and businesses that prosper when
    new markets are found for their goods and services.
        The Bank's use of loan guarantees, insurance to commercial
    banks, and direct lending, have allowed for the export of
    billions of U.S. exports that would not have gone forward for
    lack of financing.
        Over the past 5 years alone, the Bank has supported 116
    companies in 52 different communities in my own home State of
    Wisconsin. The benefits of these sales are widespread as nearly
    50 percent of these transactions were with small businesses
    just in my own State of Wisconsin.
        As you know, the President's budget request includes only
    $649 million for the Export-Import Bank, which is 25 percent
    below fiscal year 2000. Can you provide us some insight into
    the administration's reasoning for decreasing funding for the
    Bank's mission?
        Secretary Evans. Senator, I am going to give you a written
    response on this, and I will get that to you, because I think
    the reduction requires some specificity that I am not prepared
    to really offer to you right now because I do not recall all
    the numbers. But the cut itself is not as large as it appears
    on its surface.
        [The information follows:]

                 Export-Import Bank Funding in Fiscal Year 2002

        The President's budget for fiscal year 2002 proposes to
    reduce Export-Import Bank funding by approximately 25 percent.
    As OMB has indicated, at least half of this reduction is
    accounted for by OMB's lower estimates of international risk
    for 2002. It is also unclear at this point whether Ex-Im Bank
    will face the same level of demand in certain sectors, such as
    aircraft, as it has in the past. The Administration does not
    expect these budgetary cuts to have an adverse effect on Ex-Im
    Bank's responsiveness to U.S. exporters or its ability to meet
    foreign competition.
        As Secretary of Commerce and Chairman of the Trade
    Promotion Coordinating Committee, I will work to ensure that
    U.S. firms, including those that produce environmental goods
    and services, can effectively compete in international markets.

        Secretary Evans. Having said that, let me say to you the
    Ex-Im Bank is important in the overall international trade
    policy of this country. It relates in some way to the
    activities of the World Bank, the Inter-American Development
    Bank and the IMF. So there are a lot of financial institutions
    out there, banks, that are related on the world stage.
        I talked to John Robson who is incoming--yet to be
    confirmed--director or chairman of the Ex-Im Bank. I look
    forward to working with him on it.
        I have to admit to you that I have a concern when I hear
    about Ex-Im Bank granting an $18 million loan to a company in
    China to manufacture steel, when I know we have a glut of steel
    in the world. So I am kind of wondering what would cause a loan
    of that size to go to a company in China that would compete
    with companies here in America when we are filing antidumping
    suits and countervailing duty suits as fast as we can
    manufacture them.
        I had a good visit not long ago with Bill Draper, who was
    chairman of the Ex-Im Bank during the Reagan Administration,
    and he was telling me what a great program it was and what
    great things it did and what a key role it played in helping
    companies be competitive around the world. So I know it has an
    important role to play, and I want to make sure the role it is
    playing is a constructive one.
        I am just an outside director. I cannot vote. I serve on
    there as an advisory director since, obviously, Commerce is
    related to trade and the private sector and businesses.
        But what I would say to you is that it has an important
    role to play. I do not think that the cut, when fully
    explained, is as severe as it appears on the surface, and I
    will get an explanation of that to you. I hope you will find
    that, and I think you will. But anyway, I will be glad to
    respond to you more specifically.
        Senator Kohl. Thank you.
        Secretary Evans. Thank you, Senator.
        Senator Kohl. Thank you, Mr. Chairman.
        Senator Gregg. Senator Murray.
        Senator Murray. Mr. Secretary, it is nice to have you here,
    and I appreciate the funding in your budget request of $110
    million for Pacific Northwest salmon. I share some of the
    concerns of Senator Stevens and look forward to working with
    you on that very critical initiative.
        Let me follow up on what Senator Kohl was just talking
    about--and I know this is not funded in your budget, but export
    promotion is a very critical role of your Department and your
    agency. I have worked with one-stop shopping centers in Seattle
    that have been of tremendous help to many of our exports.

                              boeing versus airbus

        But the Ex-Im Bank is very critical. One out of three jobs
    in Washington State depend on trade, and it is no surprise that
    80,000 of those jobs are at Boeing. They are highly-skilled,
    family wage jobs, very important to our economy. Plus there are
    1,000 other businesses just in my home State that depend on
    those exports and contract services to Boeing as well. I know
    you know this, but Boeing is the only U.S. manufacturer of
    commercial aircraft. The competitor is Airbus. Airbus is highly
    subsidized, has sweetheart deals. They watch for what Boeing
    puts out in its contracts, and they undercut them. That is the
    environment in which we have to live today. Boeing used to have
    75 percent of the market; they are now down to 50 percent.
        The one critical tool they have is Ex-Im funding, and the
    proposed funding for Ex-Im actually threatens about $4 billion
    in sales for Boeing. That is going to have a dramatic impact on
    the U.S. economy and on Boeing's ability to survive in a very,
    very competitive market with Airbus.
        I am looking forward to your written response, but I think
    the administration needs to understand that this is critical
    not just to my home State but to the entire economy and to our
    ability to keep our one U.S. manufacturer of commercial
    aircraft able to compete in a very tough market out there right
    now. I think the only people who are happy about the 25 percent
    cut are people who live in France.
        I know you talked about numbers, and it does not look as
    bad, but I believe the request was $1.3 billion for Ex-Im
    funding and a $650 billion actual number is just going to
    really hurt us. I would love to have more time to discuss this
    with you, but I want the administration to understand that this
    is a very frightening number to many of us out there.
        Senator Gregg. I should note, Mr. Secretary, that although
    Ex-Im is obviously a big issue, is not under this committee's
    jurisdiction; it is under the Foreign Operations Subcommittee.
        Senator Murray. I am sorry--could you repeat that? I could
    not hear you.
        Senator Gregg. The Export-Import Bank does not fall under
    this subcommittee's jurisdiction; it falls under the Foreign
    Operations subcommittee. You are perfectly welcome to raise
    it----
        Senator Murray. I am well aware that the budget line falls
    under another subcommittee, but I think that your input to the
    administration is critical. So that is a battle that I will be
    fighting, and I hope that you will have some discussions about
    the critical nature because of your mission.

                          northwest straits commission

        On another local topic question, one of my priorities since
    I have arrived here is that the Northwest Straits Commission
    was a response to a very tough battle, one that all of us have
    in our States at the local level between environmental concerns
    and local concerns that resulted in a huge impasse. And we, on
    a bipartisan basis, with members of our House delegation, put
    together a Northwest Straits Commission, which is a locally-
    driven, grassroots initiative to protect marine resources in
    Puget Sound and the Strait of Juan de Fuca. It has been highly
    successful and is very popular. It is the one thing that both
    Republican and Democrats say that we are really doing right. I
    do not know if you are familiar with the project, but it has
    been zeroed out in the budget, and I am hopeful that we can get
    you familiar and get you on board as a supporter before we get
    too far--I do not know if you have heard of it or not.
        Secretary Evans. I have heard of it. I think it was funded
    at $500,000 this last year, or the year that we are in right
    now. I guess we were thinking that it really was not in the
    budget a year ago, until it was placed in the budget by the
    committee. It is a local and State effort. I know how helpful
    it has been and how constructive it has been, but I think we
    have taken the basic position that we were not really funding
    earmarks in the budget.
        Senator Murray. Well, as you know, salmon has been listed
    as an endangered species, and these are small projects that
    really have some tremendous impacts in restoring the salmon and
    salmon habitats; they are local projects that are funded with
    small amounts of money, and this is how we are going to fix the
    salmon problem, so I hope we can get you back on board with us.
        Secretary Evans. Thank you, Senator.

                          commerce-wide hiring freeze

        Senator Murray. Another question on NMFS. I am concerned
    that even with the infusion of funds into our Steller Sea Lion
    Program, we cannot get the work done because there is a hiring
    freeze in place, and everywhere I go in my region, people are
    saying that there are not enough people in the Department to
    get through the necessary paperwork and to process the forms. I
    do not know if you can shed some light on that----
        Secretary Evans. I do not know how much light I can shed on
    it. I know that even though there is a hiring freeze, we are
    hiring people daily. All they have to do is bring it up through
    the system, and we are hiring. We have 40,000 people in the
    Department; I know we have a lot of people--but what is it on
    NMFS--we have 110 positions that have not been filled, but this
    is out of 2,800 positions, so we have 2,800 positions there,
    but 110 of them have not been filled.
        Senator Murray. Well, does the hiring freeze apply to the
    positions that are open but not filled?
        Mr. Gudes. Senator, we had 20 positions in the Fisheries
    Service for salmon habitat in the prior supplemental that the
    Congress passed. We are looking at each position, and we really
    want to focus on life safety-positions----
        Senator Murray. You should just know that many of these
    people are trying to get through difficult processes. What they
    constantly run into is not enough people to work through a lot
    of the paperwork. If you could take a look at this and help us
    with it, I think it will ease a lot of the concerns,
    particularly in our rural communities.
        Secretary Evans. Sure, we will, yes.

                        technology opportunities program

        Senator Murray. Great. I have one last, quick question, Mr.
    Chairman, and it is on the Technology Opportunities Program,
    which has had tremendous impacts, particularly in our rural
    communities that do not have access to technology and are
    desperately trying to catch up. Their economies are not able to
    compete with our corridor, where most of the technology is in
    place and growing rapidly, and their economies are hurting.
    This program helps expand their infrastructure, which is
    critical to being able to get their businesses competitive and
    to bring some economic development to rural communities.
        I know it has been cut by 67 percent, and if you could just
    give me a justification for that, I would appreciate it.
        Secretary Evans. I think it is just simply taking it back
    down to the level where it was. We have been running it at
    about $15 million a year, and this last year we are in, it was
    increased to $45 million, and we took it back to where it was
    before.
        I think it is a matter of evaluating the program, being
    comfortable with it. You have to make tough choices and set
    priorities, and it was just one of those tough cuts that we
    made, but I guess I have a hard time seeing a program triple in
    a year, going from $15 million to $45 million; so we just took
    it back down to the level where it was.
        Senator Murray. I appreciate that, but I can tell you that
    the reason it tripled was because the demand in our rural
    communities is extremely high right now as their economies are
    falling dramatically far behind our urban areas, because they
    cannot compete, because they cannot get the infrastructure, and
    those are the areas where it is hardest and most expensive to
    bring it in. So these kinds of programs are really critical in
    our rural communities.
        Secretary Evans. Thank you, Senator. We will take that into
    consideration and check that.
        Senator Murray. Thank you.

                               export-import bank

        Secretary Evans. I want to just respond on the Ex-Im Bank.
    I know one thing that you will see is that when you change the
    risk profile alone, you do not need as much to support a loan,
    and I know that that is part of the cut. Just looking at the
    risk-weighted portfolio of the Ex-Im Bank, when you lower the
    risk of these loans, you do not need as much to support the
    loan. So what looks like a 25 percent cut does not mean that
    you are going to cut back the lending levels by that amount,
    which is what the countries are interested in.
        Anyway, that is just one of the points. I will get a more
    specific explanation to you, and I think you will see again
    that it does not mean reducing the number of actual loans by
    that amount at all. The amount of loans that will be granted is
    not that far below what is being granted in the year we are in.
    But I will get you specifics.
        Senator Murray. I would like to have your response, and
    maybe we can have a conversation after that.
        Secretary Evans. You bet.
        Senator Gregg. A vote has started on the cloture motion.

                                    spectrum

        Mr. Secretary, maybe you could bring us up-to-speed--you
    mentioned spectrum. What do you see happening vis-a-vis the
    efforts to address the spectrum issue generally, and
    specifically in relationship to defense needs and law
    enforcement needs and commercialization needs?
        Secretary Evans. Sure, sure. A good question. I met with
    Secretary Powell yesterday--I am sorry--Chairman Powell at the
    FCC and talked about getting with him, and I talked to
    Secretary Rumsfeld about the issue as well. I think the three
    of us need to sit down and map out our thoughts and a plan for
    spectrum use.
        Obviously, Defense has important needs. They have spectrum
    that they currently use. Some of it relates to defense; some of
    it relates to safety of life issues. Those are also critical
    issues that we need to think about when we talk about
    auctioning additional spectrum and making decisions as to
    whether there is interference or not, or whether there is
    interference that you can tolerate.
        NTIA just completed a couple of studies that are out in the
    public domain right now; we are receiving comments from
    industry right now on those studies, which speak to the issues
    of interference and what spectrum might be available.
        The studies also laid out some potential options as to
    maybe some Government spectrum that could be moved to another
    location on the spectrum. But Defense has not agreed to move
    any spectrum. The way to determine whether they can move or
    will move or if it is practical to move is to sit down and talk
    through the issues. That is why I have taken it upon myself,
    anyway, to make sure that Chairman Powell and Secretary
    Rumsfeld and myself are all very focused on this very important
    issue, because it goes back in part to what Senator Murray said
    about people who are falling behind. A good part of it is just
    getting the equipment out there where we can get information
    and technology into the rural communities.
        Senator Gregg. Where do you see the demarcation occurring
    that would allow 3G spectrum to be available for commercial
    use? Do you think that the Department of Defense is going to be
    receptive to the additional commercialization of spectrum along
    the lines of what Europe has today?
        Secretary Evans. I obviously cannot speak--am not going to
    speak, will not speak--for the Defense Department, obviously,
    but I would say to you that I have talked to Secretary Rumsfeld
    about the issue, I have talked to Dr. Schlesinger about the
    issue, so I think people know that this is something that needs
    to be considered. The Commerce Department has a study out there
    that says here is some spectrum that is currently used by
    Government agencies, including DOD, and maybe there is another
    spot over here where we can move that. It would cost ``x''
    number of dollars--and they are estimating how much money it
    would cost to move it; I believe one of the studies I saw said
    it would cost $4 billion to move it.
        So I am not in a position yet to tell you how receptive I
    think DOD will be. I do not think they have all the facts yet,
    and I do not think we really have all the facts yet. I just
    know that what needs to happen is that we need to get the
    principals at the table and talk through it so we can all
    understand the importance of freeing up the spectrum to similar
    levels that we are seeing in Europe, or what we are seeing in
    Asia.
        I take seriously that we are falling behind in the area of
    3G wireless technology and allocation, so we are very focused
    on it, but in terms of when we can get this done and how
    receptive DOD will be, when I have a chance to sit down and
    spend a little more time with Secretary Rumsfeld and Chairman
    Powell, I will be able to get you a good answer, or a much
    better answer than I am giving you right now, but I will get
    back to you as soon as I do that.
        Senator Gregg. It is good that you have focused on this,
    first off; I think that is very positive news. I am a little
    concerned that only the Defense Department was focused on it.
    It is good to hear you publicly pointing out that you are
    focused on it, and I hope the administration will develop a
    systematic way of doing this rather than just going about it
    casually. I think the community at large needs to know where we
    are going to end up on spectrum in an orchestrated way so we
    can make the investment decisions as a country.
        Secretary Evans. I share that, I share that.

                    critical infrastructure assurance office

        Senator Gregg. What about the critical infrastructure--you
    mentioned the CIAO office. Where do you see this going? Is it
    going to improve the other agencies that are involved? Are they
    going to come under its umbrella, or are they going to function
    separately?
        Secretary Evans. Senator, my speculation would be that they
    would come under the umbrella. My speculation is that we all
    need to work closely together in an interagency kind of effort.
        Having said that, I should be quick to say that it is
    something that is under active review and discussion right now.
    I looked at the organizational chart that is in place today,
    and I cannot tell you that it made a lot of sense to me in
    terms of how it is structured. But what did make sense to me is
    the critical role that Commerce must play in this because of
    where the private sector is in critical infrastructure
    protection. I think they are out in front of us by a large
    percentage. So we need them, and they are a part of it. I mean,
    that is part of the infrastructure that we are concerned about,
    protecting what they have.
        So there is the issue of making sure that their
    infrastructure is protected, which I think they are doing a
    good job of, and then our own, the Government infrastructure
    and agencies and what-have-you.
        It is a large undertaking, and first and foremost, I think
    it needs a clear organization and a clear plan as to how it is
    going to function and how it is going to operate and who is
    going to be responsible for it. Making sure that we have the
    responsibility clearly understood for this very important task
    is critical, and that is what is under way right now, and
    exactly what role Commerce would wind up playing, I am not
    sure, but it should be an important role. I think NIST has
    already done a great job in this effort so far, but I think we
    are a few weeks or a couple of months away before we are ready
    to really propose something in terms of here is how we see it.
        Senator Gregg. We will be interested in that.
        As has been mentioned by a number of people on this
    subcommittee, NOAA is something that we take a lot of pride in.
    We have spent a lot of energy and time bringing it up to where
    we think it is an extraordinary agency with very talented
    people. The Administrator has done a superb job filling in
    during this time--he used to work around here, didn't he?
        Senator Hollings. Yes. We tried to get him to work, but I
    think the Secretary is doing a better job.
        Senator Gregg. So I just want to reinforce our interest in
    this agency and the fact that we consider this to be a priority
    for us.
        Secretary Evans. Thank you, Senator.
        Senator Gregg. Senator Hollings, do you have any further
    questions?
        Senator Hollings. Just two quick things for the Secretary.
    On the compact, let your lawyer look at those marketing orders.
    Forty years ago, I came down the gangway with a basket of fresh
    peaches for Governor Pat Brown, and they ran me right back up
    onto the plane because South Carolina peaches did not comply
    with the marketing orders of California. Those things have been
    upheld by the court, and they extend them into the compact, so
    there is a legal question. At the beginning of the season one
    year, I know our farmers rushed out and put some green peaches
    as Carolina Number 1's on the New York market, and it just
    ruined the market, and that is the genesis of the marketing
    orders in California. Otherwise, do not rush to inspect them.
    We have been using that as a ``honeypot'' to balance the
    budget. We get to the end of the thing, and we say, oh, yes, we
    can sell some spectrum and get ``x'' billions of dollars, and
    there is no funding shortage--it is just a misallocation--and
    everybody is trying to make money on it.
        I can tell you right now that we have been giving it away.
        Thank you, Mr. Secretary, for an outstanding presentation.
        Secretary Evans. Thank you, Senator, very much.
        I want to say one other thing if I can about Scott Gudes,
    because you all have pointed out, and you have right to have
    great pride in NOAA. It received the best rating of any
    agency----
        Mr. Gudes. All A's.
        Secretary Evans [continuing]. All A's--above NASA, above
    everybody.
        Senator Gregg. This is the Weather Service?
        Secretary Evans. Yes, the Weather Service--it is hard to
    believe, I know.
        Senator Hollings. Who wrote that--Gudes?

                         additional committee questions

        Secretary Evans. Thank you all very much. We appreciate it.
        Senator Gregg. Thank you.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]
                   Questions Submitted by Senator Judd Gregg
                           reports and spending plan
        Question. Mr. Secretary, as you know, the Department's role in
    reporting on its activities in a timely manner is critical to the work
    of the Appropriations Subcommittees. The current rate of return on
    reporting requirements is not acceptable. In addition, answers to
    questions posed by subcommittee staff frequently take months before
    they are cleared by the OMB and are so vague that they lack utility.
    Can you provide a plan that will allow for improvement on the
    timeliness of departmental reporting and a list of reports that you
    feel are no longer necessary?
        Answer. I too am troubled by the amount of time it takes for some
    information to get through the process. I too am a stickler for
    timeliness and the adherence to deadlines. It is my hope that weekly
    budget meetings will be commenced once the Deputy Secretary is in
    place. Reports and other information requested by the Congress will be
    a regular agenda item at these meetings. I take this issue very
    seriously and want the Commerce Department to provide timely responses.
        At this time, there are no reporting requirements included in
    recent Congressional Appropriations action that are no longer
    necessary.
                commerce administrative management system (cams)
        Question. Mr. Secretary, have you reviewed the status of the
    Commerce Administrative Management System (CAMS)? Are you satisfied
    with the progress that has been made on this project? Do you have an
    out-year budget for CAMS? What are you doing to assure that CAMS will
    be delivered on time, within budget and to specifications? Your budget
    request includes $48.1 million for CAMS in fiscal year 2002. Your
    budget request also includes funding separate information technology
    systems at the EDA, the MBDA, the BXA, and the ESA. Why are these
    systems not tied into CAMS? Which other information technology systems
    within the Department of Commerce are not tied to CAMS and what are
    their functions?
        Answer. Since the restructuring of the program in fiscal year 1998
    and the successful pilot implementation of CAMS at the Census Bureau,
    where they used the system to control and account for the $5 billion
    plus 2000 Decennial Census and received an unqualified audit opinion on
    their fiscal year 2000 books, the progress of the program has been
    satisfactory and on schedule. The out-year budget projections, which
    are part of the CAMS Capital Asset Plan, are as follows: fiscal year
    2003: $40 million; fiscal year 2004: $31.3 million (full
    implementation); fiscal year 2005: $30.2 million; fiscal year 2006:
    $26.4 million; fiscal year 2007: $24.3 million.
        My Deputy CFO chairs a CAMS Executive Board consisting of the CFOs
    of the implementing bureaus (Census, NOAA, NIST and EDA) which meets
    monthly and reviews progress, budget and requirements, and identifies
    management and technical issues for resolution. In addition, the CAMS
    Program Manager, who reports to the Deputy CFO, meets weekly with NIST,
    and along with the Deputy CFO, biweekly with NOAA and biweekly with
    Census to review the details of implementation planning and execution.
        The Department has an Information Technology Investment Review
    Board whose purpose is to: review the business case for any enterprise
    system development initiative in the Department; determine if an
    adequate capital asset plan is in place; evaluate the soundness of the
    technical design and implementation strategy; review the acquisition
    plan; and ensure that the appropriate ties to the financial system
    (CAMS) have been considered and planned. In the case of Commerce
    Standard Acquisition and Reporting System (STARS), the Department's new
    acquisition management system, the Board reviewed and approved the
    business case for CSTARS after they were presented with a plan for
    integrating CSTARS with CAMS. In fact, the Office of Financial
    Management and the Office of Acquisition Management have successfully
    collaborated on the design of an interface between the two systems
    which we will begin building about one year from now. Any other
    enterprise system in the Department that generates data with a
    financial impact is required to go through this same process with the
    Investment Review Board.
        The majority of the information technology systems in Commerce are
    not directly linked to the financial system. These include
    infrastructure and mission or program-specific systems that do not have
    a financial component and therefore do not have to tie to CAMS. In
    their fiscal year 2002 request, the EDA, the MBDA, and the BXA, as well
    as several other bureaus, have submitted infrastructure improvement
    projects, which have no tie to the financial systems. In support of its
    program, the BXA has submitted a request for funding its export control
    system. Other information technology system investments requested for
    fiscal year 2002 provide support to the following programs:
      --Census and Surveys
      --Advanced Short Term Warning and Forecast Services
      --Implement Seasonal to Interannual Climate Forecast
      --Predict and Access to Decadal to Centennial Change
      --Promote Safe Navigation
      --Build Sustainable Fisheries and Recover Protected Species
      --Sustain Healthy Coasts
      --Enforce U.S. Trade Laws
      --BEA Statistical Estimation
      --Export Control
      --Measurement and Standards Laboratories
      --Advanced Technology Program
      --Manufacturing Extension Partnership
      --Radio Spectrum Assignments
      --Digital Department
      --Grant Processing and Management
      --IT Infrastructure and Office Automation Support to all program
            areas
                    critical infrastructure assurance office
        Question. What criteria will be used in evaluating CIAO?
        Answer. The Administration has continued the Critical
    Infrastructure Assurance Office operations based on its evaluation that
    the functions remain relevant and essential to overall national
    critical infrastructure policy. CIAO's continued operations will be
    assessed against the three functional requirements listed below and the
    progress it makes in fulfilling these requirements.
        The Critical Infrastructure Assurance Office (CIAO) was established
    as an interagency organization at the Department of Commerce to perform
    three basic functions:
      --First, to promote national outreach and awareness initiatives.
            These initiatives are designed to inform business leaders
            across industry sectors of the need to manage the risks
            associated with relying on information systems.
      --Second, to coordinate analyses of the U.S. Government's own
            dependencies on critical infrastructures. Last year, CIAO
            launched an initiative--labeled ``Project Matrix''--to fulfill
            this requirement. Under this program, CIAO assists Federal
            agencies in identifying the assets, networks, and associated
            infrastructure dependencies that are required to deliver
            services vital to our national and economic security.
      --Third, to coordinate the preparation of a national critical
            infrastructure assurance plan. The Bush Administration intends
            to publish its own national plan later this year.
        The Administration has decided to go forward with funding for CIAO
    in its fiscal year 2002 Budget, extending the Office's term of
    operation through the next fiscal year.
        Question. Who will be involved in CIAO's evaluation?
        Answer. The future role for CIAO beyond fiscal year 2002 will be
    decided as part of the Administration's overall policy review of
    Federal critical infrastructure protection efforts. The Department of
    Commerce is responsible for evaluating CIAO's activities.
        Question. When will a report on the evaluation be available to the
    Appropriations Committees?
        Answer. The Administration's policy review is expected to conclude
    within the next few months.
        Question. How are the NIST, NOAA and Bureau of the Census critical
    infrastructure programs tied into CIAO?
        Answer. None of the critical infrastructure protection programs of
    NIST, NOAA, or the Bureau of the Census is ``tied'' into CIAO in any
    operational sense. CIAO is responsible for coordinating certain
    critical infrastructure policy initiatives and integrating them into a
    national critical infrastructure protection plan. NIST's work in
    research and development, and in establishing best practices and
    standards for unclassified computer systems, is clearly an important
    part of any national plan and, to that extent, NIST and CIAO work
    closely together. In addition, CIAO continues to work with Department
    of Commerce organizations in identifying critical assets and
    infrastructure dependencies under Project Matrix.
        Question. Can these programs continue to exist without CIAO?
        Answer. Yes. The programs of other Department of Commerce
    organizations are discrete in nature and their existence does not
    depend on the operations of CIAO.
        Question. If CIAO were to be eliminated, how would this effect
    critical infrastructure programs in other Departments?
        Answer. If CIAO were eliminated, the Federal government's ability
    to coordinate its critical infrastructure planning--especially with
    regard to the private sector--would be diminished as a result of a loss
    of coordinated efforts to promote outreach and awareness. In addition,
    CIAO's periodic support of Federal departments and agencies would be
    diminished as well. This would also be detrimental to the Federal
    government's overall ability to maintain effective partnerships at the
    national level. For now, the functions CIAO performs remain relevant
    and important to critical infrastructure protection policy. No other
    Federal government organization has been assigned responsibility to
    perform these functions, except CIAO.
                       advanced technology program (atp)
        Question. Mr. Secretary, your budget request assumes congressional
    approval of a reprogramming request. If this reprogramming were to be
    denied, what would be your plan for funding new ATP awards? If the
    reprogramming were to be denied, will you continue to re-evaluate the
    ATP?
        Answer. The Department is currently evaluating ATP to determine
    whether a need still exists for Federal funding to assist U.S. industry
    in conducting long term applied research and development. Therefore, I
    would like an opportunity to give the program thorough consideration
    and review to determine if any restructuring of the program is
    warranted prior to funding any new ATP awards. I believe that the
    Federal government has a role in long term basic research, but I have
    concerns that ATP, while well-managed, goes beyond this and has funded
    projects more appropriate for investment by the private sector.
                       patent and trademark office (pto)
        Question. Mr. Secretary, assuming there were no budget restraints,
    what would be your top five priorities to improve efficiency of
    operations at the U.S. Patent and Trademark Office? Please rank these
    needs.
        Answer. The core mission of the USPTO is to deliver high quality
    intellectual property products and services in a timely manner. The top
    priorities in achieving that mission are:
      --Recruiting and retaining highly skilled Patent Examiners. It is
            critical for the USPTO to recruit a highly qualified workforce
            and to retain experienced patent professionals who are the most
            productive Patent Examiners if the agency is to achieve its
            quality and timeliness goals.
      --Developing paperless patent and trademark application processes.
            This will reduce the inefficiencies and costs in handling large
            volumes of paper that are processed at the USPTO.
      --Producing quality products and services. By producing quality
            products the first time and reducing errors, the USPTO will
            achieve the highest level of efficiency and citizen
            satisfaction. This will be accomplished by enhancing formal and
            on-the-job training, improving examiner search tools, and sound
            management principles.
      --Outsourcing certain activities. This will allow Patent Examiners to
            concentrate their time on the critical technical and legal
            aspect of their job and thereby increase efficiency and
            effectiveness.
      --Improving and expanding the e-government services provided by the
            USPTO to become more citizen-centered and accessible.
        Question. With the understanding that one of your priorities is to
    move rapidly toward a paperless patent application process, please
    submit a written plan on deliverables that would allow for this to
    become a reality.
        Answer. USPTO plans for paperless patent application processing are
    contingent upon receiving applications in the proper electronic format
    from our customers. The deliverable components that make up a paperless
    patent application process include:
      --Electronic Filing System.--This system was made available to the
            public in the fall of 2000, which formats patent application
            data for further automated processing and utilizes public-key
            infrastructure to provide for secure communications from
            applicant over the Internet.
      --Management Information System.--This will provide the monitoring
            and workflow of electronics documents, including the original
            application file and both incoming and outgoing correspondence
            that make up the patent application and will provide for the
            creation of management information reports.
      --Document Management System.--This will provide the necessary
            storage and handling of all components of an application, and
            ensure that the electronic records are properly managed to meet
            the legal admissibility standards.
      --Electronic Publication System.--This will provide the ability to
            deliver the appropriate version of the electronic application
            for publication.
        The USPTO has been and will continue to be aggressive in its
    deployment of information technology and e-government as resources
    permit. USPTO plans to work closely with its customers in the roll-out
    of paperless patent application processing.
        Question. The fiscal year 2002 Corporate Plan for the PTO contains
    a number of performance measures for the PTO for fiscal year 2002
    through fiscal year 2006. That document states, ``It is important to
    note that the performance measures identified for fiscal year 2003 to
    fiscal year 2006 assume that the USPTO will receive full access to its
    fees.'' Even with that assumption, the PTO projects that patent
    pendency will rise from an average of 26.2 months this fiscal year to
    38.6 months by fiscal year 2006. That analysis clearly indicates that
    the Secretary of Commerce and the Committee need to take a serious look
    at PTO operations and evaluate from the ground up what they need to do
    their job better. How can PTO make that assumption? What would happen
    if the Administration and Congress continued to withhold approximately
    15 percent of PTO fee collections consistent with the President's
    fiscal year 2002 Budget request? What can be done to address that issue
    without sacrificing quality?
        Answer. The USPTO has experienced an annual growth in patent
    application filings of more than 12 percent in recent years. We need to
    address this issue by first identifying the core goals of the USPTO;
    implementing management strategies to reach our goals; and determining
    the level of funding needed to meet these goals. We will be evaluating
    the operations of the USPTO to ensure that proper priorities are being
    set and efficient systems are in place and submitting budgets that will
    reflect these priorities.
                                us&fcs staffing
        Question. Mr. Secretary, how does the Department determine when and
    where U.S. and Foreign Commercial Service Centers are opened and
    closed? How much is being requested for the U.S. Foreign Commercial
    Service Export Assistance Centers? Please provide, in writing, a U.S.
    and Foreign Commercial Service Assistance Center expansion or
    consolidation plan that outlines both when and where openings and
    closures will occur both in this country and abroad.
        Answer. The fiscal year 2001 budget for Domestic Operations is
    $35.1 million. Of that amount, $32.3 million is budgeted for USEAC
    operations in the field. The fiscal year 2002 budget request for
    Domestic Operations is $34.3 million.
        Based on the President's budget request for fiscal year 2002, the
    US&FCS has no plans for expansion. With the recent confirmation of the
    Under Secretary for International Trade and the pending confirmation of
    the Assistant Secretary/Director General for the US&FCS, we are
    undertaking a full audit of all our domestic and overseas staffing and
    locations over the next 60 days. We anticipate that the new Assistant
    Secretary, when confirmed, will consider all options--including gapping
    positions, as well as consolidating, closing, and relocating offices
    domestically and posts overseas. We would be pleased to provide you
    with the results of that audit as soon as it is completed.
        In undertaking the audit, we will utilize performance measures,
    look at mission effectiveness, and redistribute resources accordingly--
    all in order to position our resources where they will produce the
    biggest impact for U.S. exports. We are outlining briefly below the
    factors that will guide the audit in both the overseas and domestic
    fields. Again, we would be glad to provide further detail on the
    methodology.
        We audit overseas staffing and locations in six major ways:
      --We identify the most promising markets overseas using five-year
            historic data and five-year projections relating to market size
            and market structure which we received from economic
            forecasting firm DRI (now DRI-WEFA).
      --We then identify where Foreign Service Officers are likely to have
            the greatest impact overseas based on management, operational
            and mission factors that cannot be as effectively discharged by
            local staff.
      --Next, we apply a cost-benefit analysis to identify where we have
            been getting the most bang-for-our buck.
      --Always, we consider several other important and often overriding
            factors that we did not attempt to quantify, such as
            Administration and legislative priorities, strength of trade
            promotion infrastructure, quality of local work force or
            geographic dispersion.
      --Once these quantitative tools have placed all countries on the same
            starting point, the regional offices apply in-house country and
            area expertise to make the hard calls on where to open or close
            offices and determine budget allocations.
      --Within country, we rely on the post to determine an optimal
            staffing level and mix for each country given its resources.
        We audit domestic operations in four major ways:
      --We look for large concentrations of small and medium sized
            businesses that are looking to export to new markets.
      --We consider what other resources these businesses have available to
            them.
      --We work with other Federal agencies, state and local export
            promotion groups, and other organizations such as Chambers of
            Commerce and universities, to plan where our counseling
            services could create the greatest benefit.
      --We consider the cost-effectiveness of all staffing options,
            utilizing a cost-benefit model that lets us compare
            productivity across offices in various locales.
        With the process currently underway, we expect to have a full plan
    for you within 60 days.
                               technology program
        Question. Mr. Secretary, your budget request for the Office of
    Technology Policy is $8.2 million. How is this amount broken out
    between the various Office of Technology Policy responsibilities?
        Answer. The budget requests $8.2 million for the Under Secretary/
    Office of Technology Policy. This includes $1.832 million for the
    executive management function of the Under Secretary's office; $1.5
    million for GSA rent and Hoover Building related costs; $608,000 for
    the Office of Space Commercialization; $598,000 for EPSCoT; $400,000
    for the Partnership for a New Generation Vehicle Secretariat and $3.3
    million for the Office of Technology Policy program and policy
    functions.
        Question. Do you have plans to evaluate the relative value of the
    Partnership for a New Generation of Vehicles?
        Answer. Yes. Every year the National Academies of Science and
    Engineering conduct such an evaluation. Their report for the year 2000
    is currently being developed, and we expect its release in July 2001.
    This annual evaluation, conducted by the Transportation Research
    Board's Standing Committee to Review the Research Program of the
    Partnership for a New Generation of Vehicles, is performed by a group
    of industry and academic automotive experts. Approximately half of
    these experts are members of the National Academy of Engineering.
        Question. Could economies of scale be realized if the Office of
    Technology Policy was eliminated and its programs were moved to
    separate Bureaus such as the National Institute of Standards and
    Technology?
        Answer. The missions of the Office of Technology Policy (OTP) and
    the National Institute of Standards and Technology (NIST) are very
    different. NIST is, fundamentally, a scientific and research laboratory
    staffed with scientists, engineers, and other technical personnel who
    specialize in various scientific and engineering disciplines. In
    contrast, OTP is a policy analysis and development organization. It
    analyzes the range of factors that affect technological innovation, and
    advocates policies that could increase the contribution of technology
    to U.S. economic growth and competitiveness. This policy work is
    required in the Stevenson-Wydler Technology and Innovation Act of 1980.
    It is unclear what gains, if any, would materialize by eliminating OTP
    as other Federal agencies tend to only address a narrow set of
    technology policies related to their specific missions.
                        noaa--nmfs cooperative research
        Question. Mr. Secretary, I've noticed that your budget request for
    the National Marine Fisheries Service includes an increase for
    cooperative research. This idea shows great promise for the future of
    fisheries management, but only if your fisheries scientists and
    managers are equipped and willing to use the data that is being
    collected. Can you demonstrate that they are willing and equipped to do
    so?
        Answer. Our fiscal year 2002 request includes $3.5 million for NMFS
    Cooperative Research Implementation. These funds cover the NMFS costs
    associated with cooperative research in the Northeast, including
    specific research design, field scientific staff, data assimilation and
    analysis, program administration, and application of the research
    results to Council management issues. The NMFS Cooperative Research
    Implementation funds complement our $16 million Cooperative research
    request to utilize the expertise and insights of fishers in research
    including resource survey design and interpretation. This two-part
    request provides both the resources for NMFS and the industry to ensure
    future cooperative research programs are successful and provide needed
    data.
                              noaa--nmfs lawsuits
        Question. Mr. Secretary, there are 110 lawsuits pending that name
    the National Marine Fisheries Service (NMFS) as the defendant. Twenty-
    five of these lawsuits are related to the National Environmental Policy
    Act. As you know, NMFS' untimely action in the Ninth Circuit Court last
    year resulted in a temporary shutdown of one of our nation's biggest
    fisheries. A NEPA-related lawsuit could threaten the lobster fishery in
    New England. How do you intend to approach the backlog of litigation?
    What is your plan to avoid this kind of backlog in the future? How are
    you planning to reduce the agency's risk to litigation? What steps are
    you taking to ensure that the entire staff of the agency is not pulled
    into litigation, and away from the science and regulations that they
    are required to implement? Many of the lawsuits involve a debate about
    the science. How is NMFS evolving to ensure that it makes decisions
    based upon the most up-to-date and sound science?
        Answer. NMFS is involved in approximately 106 lawsuits, but it is
    not the defendant in all of them. NMFS may be a plaintiff; it may not
    be a named party at all, but are following the lawsuit because our
    interests are implicated.
        We are certainly concerned about our litigation load, as it has
    approximately doubled in the last five or six years. Some of this
    increase is inevitable. The more species or populations an agency lists
    under the Endangered Species Act, the more litigation will ensue.
    Another example is the Sustainable Fisheries Act, which in 1996
    increased NMFS' responsibilities to rebuild overfished fisheries,
    minimize bycatch, and protect essential fish habitat. Those who believe
    we have gone too far in conserving fish stocks and habitat have sued
    us, and so have those who think we have not done enough. Other lawsuits
    may be avoided in the future if NMFS can improve its compliance with
    procedural statutes such as the National Environmental Policy Act and
    the Regulatory Flexibility Act. We have new guidelines for complying
    with the Regulatory Flexibility Act, and recently received an honorable
    mention from the Small Business Administration for our improved
    performance under that statute.
        Most, if not all, of the funding increases requested for NMFS in
    the fiscal year 2002 President's Budget will help meet the agency's
    legal requirements and thereby reduce the number of new lawsuits. The
    increased resources will fund additional stock assessment information,
    improved economic and social data, and research. This will aid NMFS in
    meeting its mandates and withstand court challenges.
        We have a task force working now, with assistance from a
    contractor, to identify ways to better manage our decision making
    process by incorporating all these procedural requirements more
    efficiently. We expect to make improvements that will result in better
    decision making and the elimination of our lawsuit backlog and other
    litigation problems.
        Question. You have requested $8 million for NEPA in fiscal year
    2002. How do you intend to spend these funds?
        Answer. Our fiscal year 2002 budget request continues the $8
    million appropriated in fiscal year 2001 to address NEPA related needs.
    This critically needed funding will be utilized in the short-term to
    fund immediately NEPA projects of highest national significance and
    litigable risk. In the long-term, the funding will be used to build on
    the task force recommendations and institute a management process that
    improves the decision making and integration of the agency's growing
    statutory, regulatory, and legal requirements. Additionally, the fiscal
    year 2002 budget request includes proposed funding of $13.3 million for
    additional stock assessments, and $1.4 million for more socio-economic
    analysis. Support for these requests would provide better data for the
    management arena as well.
                        noaa--fisheries research vessels
        Question. Mr. Secretary, I am concerned that as NOAA's fisheries
    research vessels are pushed into proposed future budget requests that
    the cost per vessel will increase. As you know, the NOAA fleet is aging
    and many of the NOAA vessels must be replaced. Why wasn't the second
    fisheries vessel included in the budget request?
        Answer. Mr. Chairman, the Administration has decided to defer
    funding for the second vessel to fiscal year 2003 to capture
    efficiencies and economies obtained through the design of the first
    vessel. However, this program remains a high priority for NOAA and
    NMFS.
        Question. Will you support its funding if we find resources for it?
        Answer. The Fisheries Research Vessel construction contract
    includes options to support NOAA's requirement to build three
    additional vessels. NOAA is committed to meeting this requirement.
        Question. Can you assure me that next year we see the third vessel
    in the budget request?
        Answer. NOAA is currently working with the Administration to secure
    funding in future years for these additional vessels.
                   stimulating u.s. markets to ensure growth
        Question. Secretary Evans, as you know the United States is the
    largest, most dynamic, and, most influential market in the world. We
    have experienced significant growth and innovation, resulting in
    increased wealth for much of the country. The U.S.'s influence on
    global markets is undeniable and dramatic. Yet, along with the
    designation of ``worlds' largest economy'' comes certain
    responsibilities. Some have even called the United States ``the market
    of last resort,'' meaning that we must import goods and services in
    order to maintain some measure of economic order. Currently, our growth
    is slowing. People are not buying like they did a few years ago. Stock
    market analysts talk about ``a market rebound'' rather than ``historic
    trading levels.'' Mr. Secretary, recognizing the U.S.'s role in the
    world, and our slowing economy, what is your plan to stimulate our
    markets to ensure continued growth?
        Answer. The Administration is pursuing monetary, fiscal and trade
    policies that foster and improve a favorable climate for growth. In
    this regard, the tax legislation is critical. The near term stimulus of
    the tax bill is important. Since businesses look to the future, so too
    are those features of the Administration's strategy that encourage
    education, saving, risk taking and adopting a longer term perspective
    in investment in people and by people.
        Just as U.S. markets represent important opportunities for foreign
    producers, U.S. economic strength depends in part on expanding access
    to foreign markets for U.S. producers. In recent years, the U.S.
    economy has enjoyed major productivity gains, high employment and low
    inflation stemming largely from the spread of IT investments. But these
    improvements only create the potential for commercial successes abroad
    if we have more open access to foreign markets. To realize our
    potential, we must continue to work for a more liberal international
    trading system.
        Open markets at home and abroad are good for Americans and good for
    the global economy. Open U.S. markets provide lower prices and more
    choice to our consumers, which makes incomes of all consumers go
    further. In essence, open trade, much like a tax cut, increases
    people's discretionary income. This is particularly so in a competitive
    economy such as ours where the benefits of open trade quickly find
    their way to consumers in the form of greater choice and lower prices.
        Internationally, open trade has contributed far more to post World
    War II economic expansion where countries have pursued liberal trade
    policies than where countries that have chosen more closed trade
    regimes, often marked by quotas, high duties and administrative
    restraints to the flow of goods and services.
                                     ______

                 Question Submitted by Senator Pete V. Domenici
                     promoting commerce in southwest region
        Question. Earlier, I referenced that our recently booming economy
    generated significant wealth for much of America. However, rural areas
    have not realized many of these gains from trade. New Mexico is a rural
    state. Even more to the point, my state's border region with Mexico is
    disproportionately poor. The median household income in the border area
    is $14,000 compared to $16,346 for the rest of the state. We should not
    point to the wealth of the majority while ignoring the relative poverty
    of the minority. Please explain your strategy to promote commerce in
    traditionally forgotten regions, like the southwest border region.
        Answer. The Economic Development Administration's (EDA) mission is
    to generate jobs, help retain existing jobs and stimulate industrial,
    technological and commercial growth in economically distressed areas of
    the United States. EDA targets its assistance to distressed
    communities, such as those found in the Southwest Border Region,
    helping them in developing and implementing their own economic
    development and revitalization strategies. EDA provides planning
    assistance on an ongoing basis to seven Economic Development Districts
    (EDDs) in New Mexico that encompasses the entire state. The state's
    border region is covered by three EDA funded EDDs: Southwest NM Council
    of Governments, in Silver City; South Central NM Council of
    Governments, in Truth or Consequences; and Southeastern NM Economic
    Development District, in Roswell. EDA also funds two University Centers
    which are located in the border area. One is at the New Mexico State
    University in Las Cruces and the other is at Eastern NM University in
    Roswell.
        EDA also plays an active role in support of the Interagency Task
    Force on the Economic Development of the Southwest Border initiative.
    EDA's Austin Regional Office volunteered to assume the lead for the
    selected pilot community of Demming, New Mexico. EDA's function, in
    addition to providing technical assistance and direct program support,
    is to assist in coordinating other available Federal resources to
    implement the community's comprehensive economic development strategy.
    Also under study is a preliminary proposal for Wiring of the Border
    being developed and co-sponsored by the U.S. Mexico Chamber of
    Commerce.
                                     ______

               Questions Submitted by Senator Barbara A. Mikulski
                 accessing eda funds to low-income communities
        Question. Last year, we appropriated $286 million to just the
    public works program, which supports local government efforts to
    attract new industry, encourage business expansion, diversify local
    economies, generate long-term private jobs. Despite its success in
    these efforts, EDA has been targeted in your budget for drastic
    reductions. What activities is the Commerce Department prepared to
    undertake to otherwise assist low-income communities who will no longer
    have access to economic development funds from EDA?
        Answer. Economically distressed communities will still have access
    to all of EDA's various program tools, which include grants for
    Planning, Technical Assistance, Economic Adjustment, and Public Works
    and Economic Development Facilities.
        While the $250 million requested in fiscal year 2002 for EDA's
    Public Works and Economic Development Facilities Program is
    approximately $36 million below the amount appropriated for fiscal year
    2001, we believe the amount requested will be sufficient to enable EDA
    to respond to the needs of the highly distressed communities of the
    Nation.
        EDA, which has a good track record of targeting its Public Works
    Program resources to areas of high distress, will continue to reach out
    to economically distressed places, both rural and urban, that have
    demonstrated a pressing need to upgrade their basic infrastructure or
    construct new cutting-edge technological facilities that are required
    to support the economic development of local economies and to enhance
    the global competitiveness of distressed communities.
                                 digital divide
        Question. The Commerce Department did an excellent job over the
    past three years demonstrating that a digital divide exists in America.
    The Department put out a series of reports entitled ``Falling Through
    the Net'' that indicated the digital divide is still widening. For
    example, the report showed that 46 percent of white households own
    computers versus only 25 percent of Hispanic households. What do you
    see as the Department's role in ensuring that no American is left out
    or left behind in the new techno-economy? What funding priorities in
    your budget achieve this goal?
        Answer. A long-standing priority of the U.S. government has been
    universal access to basic and advanced telecommunications services at
    affordable prices. Access to the tools of the new digital economy by
    all Americans is the key to the economic growth and competitiveness of
    this country. Yet many Americans still do not have affordable access to
    telephones, computers, or the Internet.
        The Department of Commerce will continue to play a role in
    promoting affordable access by promoting pro-competition policies.
    These policies encourage competition and growth in telecommunications
    services, which lead to new services being offered to more people at
    lower prices. Moreover, the Department's grant programs help provide
    access to new technologies. The President's budget requests $15.5
    million for the Technologies Opportunities Program (TOP), administered
    by the National Telecommunications and Information Administration. This
    program provides matching federal grants to finance demonstration
    projects that focus on connections to rural and inner-city areas. The
    program emphasizes the application of new technologies, including
    broadband. In addition, the grant and loan programs administered by the
    Economic Development Administration are helping to support broadband
    infrastructure deployment to distressed communities.
        The Department is currently reviewing the ``Falling Through the
    Net'' report to determine how to proceed in order to best assess the
    relative growth of the Internet and computer access across the country.
                              suitland facilities
        Question. The current condition of the Census and NOAA facilities
    at the Suitland Federal Center in Maryland pose serious health and
    safety risks for thousands of federal employees: they are riddled with
    asbestos, there are high levels of lead in the water such that
    employees have to use bottled water for drinking and don't know if it's
    safe for them to wash their hands. In addition, these buildings are
    over 60 years old and have received little maintenance over the past
    several years--roof leaks and floods from broken pipes are not an
    uncommon occurrence, and ceiling tiles, possibly contaminated with
    asbestos, fall down on employees desks. As you know, the Census Bureau
    employees more than 4,000 employees at the Suitland facilities and is
    the sixth largest employer in Prince Georges County. The Bureau is
    extremely disadvantaged by having to carry out its work in substandard,
    unhealthy conditions.
        Similarly, NOAA's National Environment Satellite, Data, and
    Information Service (NESDIS) and its Satellite Operations Control
    Center, cannot complete their mission within these buildings. In fiscal
    year 2000, there was $3 million for NOAA to plan and design a new
    facility and report language to direct Census to come up with a long-
    range plan for its facilities. Last year, NOAA received $15 million in
    advanced appropriations for the initial rehabilitation. The General
    Services Administration budget for fiscal year 2002 includes $34
    million to rehabilitate Census facilities, and the NOAA budget contains
    $15 million to finish the renovations. Do you agree that the current
    condition of the Census and NOAA facilities at the Suitland Center
    endanger the health and safety of the federal employees who work there?
        Answer. While the current condition of the Census and NOAA
    facilities at the Suitland Federal Center does not endanger the health
    and safety of the federal employees who work there due to the special
    measures and monitoring put in place, we agree that the current
    facilities are not sustainable. The aging, 60 year old buildings are in
    substantial need of repair. Our concerns are based upon continual
    problems that threaten the day-to-day operations, as well as the health
    and safety of the employees and other individuals who must visit or
    work in these aging, deteriorating facilities. The following is a list
    of the major issues that must be addressed:
      --aging, unreliable, uncontrolled heating and air conditioning (HVAC)
            systems, which rely upon a central plant supplying chilled
            water for air conditioning and several boilers in multiple
            buildings supplying hot water for heat, make the systems
            unresponsive to swing-season conditions
      --frequent leaks from the HVAC units which result in carpet damage
            that contributes to mold and mildew growth and poor indoor air
            quality
      --frequent roof and wall leaks that have resulted in damage to
            ceiling tiles, furniture, and equipment
      --aging, corroded plumbing that is prone to leaks, blockages, serious
            pipe breaks, and office flooding
      --aging power equipment and the lack of a managed electrical system
            that require extensive wiring searches and major rerouting of
            wiring to make electrical repairs
      --aging, unreliable elevators that are frequently inoperable
      --elevated levels of lead, iron, and copper in the water supply that
            is designated as unfit for human consumption, making bottled
            water a necessity at the facility
      --no outside fresh air circulatory systems, which encourages the
            growth of molds and other microbes that cause poor indoor air
            quality
      --existence of asbestos contamination in the air-handling units, pipe
            wraps, floor tiles, and above the drop-ceiling tiles
      --pigeon, rodent, and other pest infestation.
        Question. Will you keep the replacement or rehabilitation of these
    buildings as a top priority for the Department of Commerce?
        Answer. Yes. Safe working conditions and modern facilities to house
    employees are top priorities of the Department of Commerce. The
    Department is working with GSA to formulate long-term housing solutions
    for both Census and NOAA at the Suitland Federal Center (SFC).
        GSA has proposed a two-phase solution for the Census Bureau. Phase
    I involves the construction of a new building equal in size to Federal
    Building 3 (FB-3). The new building would be occupied in fiscal year
    2006 by employees now located in FB-3.
        Once the existing building is vacated, Phase II would involve the
    renovation of FB-3 with occupancy scheduled for remaining Census
    employees in fiscal year 2010. As Phase I nears completion, GSA and the
    Department will revisit the plan for Phase II to ensure that the most
    appropriate and cost effective solution will be undertaken.
        For NOAA, the replacement of FB-4 has been identified as a national
    priority by both GSA and the Department of Commerce. The design
    contract for the new NOAA Satellite Operations Facility at the Suitland
    Federal Center was awarded in January 2001 and is underway. The
    President's fiscal year 2002 budget request includes $34 million for
    GSA for the construction of the ``base building'' scheduled to begin in
    October 2001.
        In fiscal year 2001, NOAA was appropriated $15 million for its
    above standard construction costs necessary to meet its high technology
    operational requirements. Included in the President's fiscal year 2002
    budget request is $5.7 million for costs related to the occupancy of
    the building and to sustain the 24-hour, 7 day a week critical
    satellite operations during the relocation into the new facility.
        This project is scheduled for completion in early fiscal year 2004
    and will continue to be a top priority of NOAA and the Department.

                              subcommittee recess

        Senator Gregg. If there is nothing further, the
    subcommittee will stand in recess.
        [Whereupon, at 11:10 a.m., Tuesday, May 1, the subcommittee
    was recessed, to reconvene subject to the call of the Chair.]

    DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE JUDICIARY, AND RELATED
                  AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2002

                                  ----------

                             THURSDAY, MAY 3, 2001

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 9:57 a.m., in room SD-192, Dirksen
    Senate Office Building, Hon. Judd Gregg (chairman) presiding.
        Present: Senators Gregg, Stevens, Hollings, Mikulski,
    Leahy, and Murray.

                              DEPARTMENT OF STATE

                               Secretary of State

    STATEMENT OF HON. COLIN L. POWELL, SECRETARY
        Senator Gregg. I call the Subcommittee on Commerce,
    Justice, State, and Judiciary of the Appropriations Committee
    to order.
        We are certainly privileged today and appreciate the
    Secretary of State coming by to give us his thoughts on the
    budget and any other issues that he wishes to address or that
    members wish to raise.
        I will forego an opening statement so we can hear from the
    Secretary. I do not know if my colleague----
        Senator Hollings. Good. I will follow your leadership.
        Senator Gregg. Then, we will pass on opening statements,
    and we would like to hear your thoughts, Mr. Secretary--excuse
    me, Senator Leahy. Did you wish to say something? I understand
    Senator Leahy has to leave.
        Senator Leahy. Mr. Chairman, I have to go to the Judiciary
    Committee; we have a little matter up there this morning. If I
    could have permission to submit questions for the record and my
    statement.
        Senator Gregg. Yes, absolutely.
        Senator Leahy. And I am, like all of us, delighted to see
    the Secretary here.
        Secretary Powell. Thank you, Senator.
        Senator Gregg. Thank you for coming by.
        [The statements follow:]

                 Prepared Statement of Senator Patrick J. Leahy

        Mr. Secretary, it is good to see you. I think your
    appointment was one of the President's best and most important
    decisions so far, both for our country and for the State
    Department.
        This has already been shown by the effective way the
    Administration handled the crisis with China over our
    reconnaissance aircraft, the public statements you have made
    for a more aggressive response to HIV/AIDS, and your work on
    other issues.
        You are scheduled to testify before the Foreign Operations
    Subcommittee the week after next, so I do not want to take a
    lot of time today. There are a couple of issues I want to
    mention.
        First, thank you for continuing the position of Special
    Representative for Global Humanitarian Demining. Ambassador Don
    Steinberg has done an outstanding job, and it is important that
    we continue to make progress on the landmine problem.
        I hope you and I can find a time soon to discuss this
    further.
        Second, I want you to know that I believe the budget for
    the Bureau for Democracy, Human Rights, and Labor is
    inadequate.
        This office has some of the most hard working, committed,
    and under-appreciated professionals in the State Department.
    They are responsible for ensuring that the most fundamental
    principles on which our country was founded are reflected in
    our foreign policy.
        Yet they have few funds to independently investigate
    reports of serious human rights violations.
        Too often, their views have been ignored or ridiculed as
    naive. They are told that human rights are important, but there
    are higher priorities.
        Last year, thanks to this Subcommittee, the Congress
    increased the budget for the DRL Bureau to $12 million. The
    Administration requested the same amount for 2002.
        I believe they need more, and I hope we can do better.
        Finally, I want to mention U.N. arrears. We were all
    pleased that Ambassador Holbrooke was able to achieve an
    agreement on a reduction in the U.S. share of U.N. dues last
    December, and that the Senate passed legislation to implement
    the deal. I hope the House acts on this soon.
        But if we do not repeal the 25 percent funding cap, we will
    continue to accumulate arrears and be right back where we
    started. I urge you to work with Congress to move on this as
    soon as possible.
        Mr. Secretary, there are other priorities like funding for
    AIDS, the immense needs in Africa, and other foreign assistance
    programs that we will discuss at the hearing on May 15.
        I think we all feel that the State Department is in very
    good hands, and I look forward to working with you this year
    and in the future, particularly on the international affairs
    budget.
        If I can be so presumptuous as to give you one piece of
    advice:
        You can have the best foreign policies in the world but if
    you don't have the funds to implement them, they are not worth
    much.
        Too many of your predecessors seemed to forget that after
    their first year in office, and they learned the hard way how
    big a mistake that was.
        Mr. Chairman, I have a couple of questions I will submit
    for the record.
                                    ------

               Prepared Statement of Senator Barbara A. Mikulski

        Mr. Secretary, let me join in welcoming you to this
    subcommittee for the first time. Your talents and experience
    are well known to us all. I am proud to carry on a tradition of
    bipartisanship in foreign affairs in this subcommittee and in
    the Senate, though there have been tragic exceptions like the
    Comprehensive Test Ban Treaty vote last year.
        I look forward to working closely with you to ensure
    American leadership is headed in the right direction and to
    ensure we devote the necessary resources to protect America's
    interests and reflect America's values.
        I commend you for working to reinvigorate the State
    Department. Our Foreign Service Officers and civil servants
    serve our nation and endure hardships and risk their lives.
    They deserve secure, modern embassies not collapsing relics or
    trailers; 21st Century information technology not 19th Century
    cables; benefits they have earned not home leave they routinely
    forgo to reduce staffing gaps; and a career path that rewards
    performance not an uncertain future due to poor planning.
        America's foreign policy professionals deserve our respect
    and support. I stand ready to support increased funding for the
    State Department. We're counting on you to make sure our
    resources are used well.
        We must ensure that our foreign policy is one which
    deserves broad support from the American people not the agenda
    of a small minority who insist on the global ``gag rule'' which
    makes international family planning efforts less effective; not
    the interests of a few corporations who want to resume trade
    ties with terrorist states like Libya and Iran; and not an
    isolationist approach, leaving Europe to the Europeans or
    looking away from the AIDS crisis in Africa.
        We should seize the opportunity to build a new relationship
    with the United Nations. The United Nations continues
    management and other reforms. Ambassador Holbrooke achieved
    reductions in our assessment rates last December. Now we must
    pay our dues and arrears responsibly. We must remain fully
    engaged in diplomacy to prevent or address conflicts in the
    Middle East, standing by our ally Israel at a difficult time;
    in the Balkans, ensuring our interventions achieved lasting
    peace with justice and with respect for the rights of all; in
    Cyprus, which has been divided for decades; in Africa, where
    ethnic conflicts, health crises, and slavery continue; and in
    Latin America, where we have the opportunity to work with
    democratically-elected governments in almost every country.
        Mr. Secretary, we are looking to you to provide leadership
    for America's diplomats and for American diplomacy. Thank you
    for testifying today and I look forward to raising a few
    questions.

        Senator Gregg. Mr. Secretary, please proceed.
        Secretary Powell. Thank you very much, Mr. Chairman, and
    good morning. It is a great pleasure to appear before the
    subcommittee, and I am tempted to take the same opportunity
    that you did to pass on an opening statement, but I do not
    think I can get away with that.
        Senator Gregg. Whatever you desire.
        Secretary Powell. So what I would like to do is submit a
    formal statement for the record with your permission, Mr.
    Chairman, and then make some opening remarks and go right to
    the questions that might be on your mind.
        Mr. Chairman, members of the subcommittee, I am pleased to
    appear before you for the first time as Secretary of State and
    to testify in support of the President's State Department
    budget for fiscal year 2002.
        The budget, I am pleased to say, represents a significant
    increase in the Department's resources for the upcoming fiscal
    year, and we are very happy with that. It is a very good start
    in helping to get the Department ready for the 21st century.
    But it really is just the first fiscal step in our efforts to
    align both the organization for and the conduct of America's
    foreign relations with the dictates and demands of the modern
    world.
        As Secretary of State, Mr. Chairman, I really wear two
    hats. By law, I am the principal foreign policy advisor to the
    President of the United States, but I am also the leader, the
    manager, the CEO of the Department of State, and I take that
    role and that charge very, very seriously.
        To be successful in both roles, I think I have to make sure
    that the Department is properly organized, equipped, and manned
    to conduct America's foreign policy as well as formulate good
    foreign policy in the name of the President and the American
    people.
        This morning, wearing my CEO hat, I want to highlight what
    this budget contains with respect to the President's three
    highest priorities for the operation of the State Department--
    first, hiring new people, the lifeblood of any organization;
    second, Embassy construction and security, an issue which I
    know is very much on the minds of members of this committee;
    and third, information technology.
        I put people first because they should always be first; it
    is what makes the organization run. People get work done--not
    buildings, not staffs in a generic sense, and not plans--but
    people, and people will always be my first priority.
        There is no disputing that America needs to have the right
    people on the front lines of diplomacy. But we also need to
    have enough people. So the budget has $134.5 million for a
    major investment to recruit, hire, and train sufficient new
    people to create a training float. As well as staff for needed
    openings, so that we can begin to do something about the
    serious shortages we are experiencing in Foreign Service
    Officers in the field.
        In addition, we are seeking $488 million to continue and
    enhance our worldwide security readiness program. This
    enhancement includes hiring more security personnel, and we
    have $17 million within the $488 million to do just that.
        Our important multiyear program for Embassy construction,
    refurbishment, security, and maintenance will continue apace if
    this budget is approved--$1.3 billion supports this effort for
    2002, including $665 million for construction of new secure
    facilities.
        In addition to continuing this ambitious program set in
    place by my predecessors and the Congress last year, we are
    using new and more efficient ways to execute this program. For
    example, as we have notified the Congress, I intend to move the
    Foreign Buildings Office out from under the Bureau of
    Administration and put it directly beneath the Under Secretary
    of State for Management, Mr. Grant Green, a distinguished
    leader and management expert, and by the way, a close friend of
    mine for 20 years, who knows how to run things.
        Moreover, to run the Foreign Buildings Office, I have hired
    another experienced executive, retired Major General Charles
    Williams, U.S. Army Corps of Engineers. Chuck Williams is well-
    known throughout the congressional community, the military
    community, and especially the construction community, both
    military and civilian. He is well-known for his ability to get
    construction projects completed on time, under cost, and in the
    most efficient way possible. He built the Dulles Greenway, not
    too far from here. He helped to refurbish the D.C. school
    system and did the same thing in New York City. He has worked
    with Congress, and he is already making a difference in the
    running of the Foreign Buildings Office. His adaptation of
    industry best practices to our overall program, plus his
    skilled management techniques, will make this construction
    program hum. And we are committed, Mr. Chairman, to getting the
    average cost of Embassy construction below the current figure
    of $100 million per Embassy, and if anyone can do it, I know
    that Chuck Williams can.
        It will be no mean feat because, as you are well aware,
    there are special provisions and requirements for every
    Embassy, and those unique provisions and requirements tend to
    drive costs up enormously. But we are going to give all we have
    got to get the price down and under control.
        Along with well-built, secure, and modern embassies, we
    want broad-based internet access for all of our people. I want
    every employee in the Department of State, no matter where they
    are located throughout the world, to have access to the
    powerful new internet technology that is out there, access to
    the power of the information revolution, so they can do their
    jobs in the most efficient way that we can make possible for
    them to do those jobs.
        We also want to modernize our classified information
    networks, and we have $210 million in the budget for these two
    initiatives--universal access to the internet, and modernized
    classified networks.
        On the CEO side of my ledger, then, these are my
    priorities--people, embassies, and information technology. Wrap
    all three up in the fourth priority, which is security, and you
    have the high points of the President's 2002 budget for State
    operations.
        I want to talk about one other change we are making in the
    Department. We are reorganizing the way that we manage our
    finances. When I first arrived at State and looked around
    during the transition period, I did not find any single
    authority in charge of all of the Department's financial
    activity. There was a chief financial officer, but he had no
    control over the foreign operations part of the money, two-
    thirds of the overall budget. I knew that we needed to change
    that overall situation.
        Under our plan to change, we will bring together all of our
    dollars, both those for State operations and foreign
    operations, and we will put them all under one bureau headed by
    an Assistant Secretary of State for Resource Management, and
    the Assistant Secretary will report directly to the Deputy
    Secretary.
        This new bureau will also be responsible for strategic
    planning so that we can link our budgeting priorities and our
    budget requests to specific strategic planning objectives that
    we have for the Department.
        These are just the highlights of what we are doing, Mr.
    Chairman. I want to close with an observation about the
    management style that we are going to be using at the State
    Department.
        I have hired some very, very experienced people to help me.
    Deputy Secretary of State Richard Armitage and I worked
    together for many years at the Pentagon. I have delegated to
    him all of the authority that I have with the exception of a
    few legally-constrained authorities that I cannot delegate. The
    reason I did that was because I want the Department to see
    myself and my deputy as one and the same, totally integrated,
    both of us trying to be leaders and managers and foreign policy
    experts.
        Leadership and management is not something I do every
    Friday afternoon for an hour or so. It is embedded in
    everything we do, every, single day in the State Department.
    And I want them to see that the top team, myself and Deputy
    Secretary Armitage, are working together as a team on
    leadership, management, and foreign policy for the President
    and for the American people.
        Similarly with Grant Green and with our new Undersecretary
    for Political Affairs, Mark Grossman--a tight team that is
    working together to provide a new sense of enthusiasm
    throughout the State Department, to empower all of our
    Assistant Secretaries, to empower our Office Directors, to
    empower our Ambassadors, to let them know that they are in the
    front line of offense out there, getting the work done and
    making sure that we are a well-knitted-together team. From the
    lowliest--and that is not the right term--but the best and the
    lowest-position consular officer out there in an Embassy
    somewhere, all the way up to the Secretary of State--one team,
    all working together, all empowered, all knitted together with
    the finest information technology, with programs that take care
    of them, take care of their families, take care of their kids'
    schooling, so they know that we care about them as they do
    about the work that is needed to be done for the American
    people and to advance American interests on the world stage.

                               prepared statement

        Mr. Chairman, I will stop at this point, because I think it
    is much more interesting to get to your questions and find out
    what you would like to hear from me.
        [The statements follows:]
                     Prepared Statement of Colin L. Powell
        Mr. Chairman, members of the subcommittee, I am pleased to appear
    before you for the first time as Secretary of State, and to testify in
    support of the President's State Department Budget for fiscal year
    2002.
        This Budget represents a significant increase in the Department's
    resources for the upcoming fiscal year, and we are pleased with that.
    This is a good start.
        It is the first fiscal step in our efforts to align both the
    organization for and the conduct of America's foreign relations with
    the dictates of the 21st Century.
        As Secretary of State I wear two hats--one as CEO of the
    Department, the other as the President's principal foreign policy
    advisor.
        Being successful in both roles is important because we must be
    properly organized, equipped, and manned to conduct America's foreign
    policy as well as formulate good policy.
        So wearing my CEO hat, I want to highlight what this budget
    contains with respect to my three highest priorities: embassy
    construction and security, information technology, and hiring new
    people.
        Our important multi-year program for embassy construction,
    refurbishment, security, and maintenance will continue to move forward
    if this Budget is approved. $1.3 billion supports this effort for
    fiscal year 2002, including $665 million for construction of new secure
    facilities.
        In addition to continuing this ambitious program set in place by my
    predecessors and the Congress last year, we are using new and more
    efficient ways to execute this program.
        For example, as we have notified the Congress I intend to move the
    Foreign Buildings Office (FBO) out from under the Bureau of
    Administration and put it directly beneath Under Secretary for
    Management Grant Green.
        Moreover, I've hired an experienced executive to manage overseas
    construction, retired Major General Charles Williams, U.S. Army Corps
    of Engineers. His adaptation of industry best practices to our overall
    program, plus skilled management techniques, will make this program
    hum.
        We are committed to getting the average cost of embassy
    construction below the current figure of $100 million. If anyone can do
    it, Chuck Williams can. It will be no mean feat because, as you are
    well aware, there are special provisions and requirements for every
    embassy and those provisions and requirements drive up costs
    enormously. But we're going to give it all we've got.
        Along with well-built, secure and modern embassies, we want broad-
    based Internet access for all our people. I want every State employee
    to have access to the Internet and to be able to talk to each other.
    Likewise, we want to modernize our classified information networks.
    We've got $210 million in the budget for these initiatives.
        There is no disputing that America needs to have the right people
    on the front lines of diplomacy. But we also need to have enough
    people. The budget has $134.5 million for a major investment to
    recruit, hire, and train sufficient new people to create a training
    float so that we can begin to do something about the serious shortages
    we're experiencing in Foreign Service Officers (FSOs) in the field. In
    addition, we are seeking $488 million to continue and enhance our
    worldwide security readiness program. This enhancement includes hiring
    more security personnel and we have $17.1 million within the $488
    million to do just that.
        On the CEO side of my ledger, these are the priorities--embassies,
    people, and information technology. Wrap all three up in a fourth
    priority called ``security'', and you have the high points of the
    President's fiscal year 2002 Budget for State operations.
        But let me talk about one more change we are making before I go
    into levels of detail about the Budget. We are reorganizing the way the
    Department manages its finances.
        When I first arrived at State and looked around, frankly, I could
    not find any single authority in charge of all of the Department's
    finances. There was a Chief Financial Officer but he had no control
    over the Foreign Operations portion of the money--two-thirds of the
    overall budget. I knew we needed to change that situation.
        Under our planned change, we will bring together all our dollars--
    both those for State operations and foreign operations.
        We'll then put them all under one bureau headed by an assistant
    secretary of state for resource management. The assistant secretary
    will report to the Deputy Secretary.
        This new bureau will also be responsible for our strategic
    planning. Previously, such planning was accomplished in a number of
    different offices and as a consequence it was quite often separated
    from actual resource decisions. With the new bureau, we are going to
    streamline and consolidate so as to synchronize our actual resource
    allocation with our strategic goals.
        Consolidating under one bureau will also establish accountability.
    All dollars under the purview of the Secretary of State will be
    coordinated within this bureau.
        Linking more directly our strategy and our dollars, and making the
    expenditure of those dollars more accountable, will make us more
    effective, more efficient, and infinitely better able to justify our
    resources.
        Mr. Chairman, there is of course much more to the President's
    Budget for fiscal year 2002 for State operations. Let me provide some
    of the details under three general headings: Administration of Foreign
    Affairs, International Organizations, and Related Appropriations.
                       administration of foreign affairs
    Diplomatic and Consular Programs (D&CP):
        The fiscal year 2002 request for D&CP, the State Department's chief
    operating account, totals $3.705 billion.
        This account funds the diplomatic activities and programs that
    constitute the first line of defense against threats to the security
    and prosperity of the American people. Together with Machine Readable
    Visa and other fees, it supports the salaries, operating expenses, and
    infrastructure required to carry out U.S. foreign policy.
        The fiscal year 2002 request provides $3.217 billion in D&CP for
    ongoing operations--a net increase of $459.3 million over the fiscal
    year 2001 level. Increased funding will enable the State Department to
    make critical improvements in diplomatic readiness, particularly in
    human resources and overseas infrastructure.
        The United States must have the right people in the right place at
    the right time with the right skills to advance national interests
    effectively. To meet this requirement, the State Department will
    implement a strategy to recruit, hire, train, and deploy the additional
    professionals needed around the world. We will put in place processes
    to test the effectiveness of our strategy and to ensure accountability.
    With new D&CP funding in fiscal year 2002 of $134.5 million, the State
    Department will add 360 professionals and create a work environment
    that will help attract and retain talent in a highly competitive
    economy.
        The United States requires a strong and secure diplomatic platform
    to support the work of more than 30 Federal agencies at more than 250
    posts overseas. With new D&CP funding of $78 million, the State
    Department will restore infrastructure and address deferred
    maintenance. In fiscal year 2002 the Department will replace a third of
    its obsolete equipment and unreliable vehicles; increase training,
    essential service contracts, and Foreign National employee wages; and
    continue consolidating overseas financial functions in the Charleston
    Financial Services Center.
        The D&CP ongoing budget also includes new base funding of $102.7
    million for the operating and maintenance costs of information
    technology investments. These costs have been carried by the
    Information Resources Management (IRM) Central Fund, using two-thirds
    of its resources for maintenance rather than modernization.
        An increase of $17 million will support priority foreign policy
    initiatives. These include projects in the areas of intelligence and
    research, Freedom of Information and Privacy Act compliance, arms
    control and international security (meeting nonproliferation,
    disarmament, and verification obligations), and international trade.
        The fiscal year 2002 request also provides $487.7 million in D&CP
    for Worldwide Security Upgrades--an increase of $78.6 million over last
    year.
        This funding includes $349.3 million to sustain security programs
    begun with the fiscal year 1999 emergency supplemental, such as
    worldwide guard protection, physical security equipment and technical
    support, information/systems security, and personnel and training.
        Worldwide Security Upgrades also includes $74 million to help
    continue the perimeter security enhancement program for 232 posts;
    $47.3 million to improve technical, counterintelligence, and domestic
    programs; and $17.1 million to add 186 security professionals.
    Capital Investment Fund
        The fiscal year 2002 request provides $210 million for the Capital
    Investment Fund, the State Department's principal funding for
    information technology (IT) enhancements. The request represents an
    increase of $113.2 million over the fiscal year 2001 level.
        Together with an estimated $63 million in Expedited Passport fees,
    this request finances the IRM Central Fund to permit vital IT
    investments and enable more effective interaction and information
    sharing among agencies in the foreign affairs community.
        Funding for the IRM Central Fund will provide $236.9 million for IT
    infrastructure. A key initiative will extend classified connectivity to
    every post that requires it, adding new posts and replacing obsolete
    equipment that posts are still using for classified operations. Another
    priority initiative will expand desktop access to the Internet for
    State Department employees around the world through full deployment of
    OpenNet Plus, an intranet for sensitive but unclassified e-mail plus
    Internet access.
        Funding will also provide $26.2 million for IT applications and
    software that directly support foreign affairs activities and $9.9
    million for IT training of systems managers and users.
        This request makes the IRM Central Fund a true investment fund,
    shifting IT operating and maintenance funding to D&CP.
    Embassy Security, Construction, and Maintenance (ESCM):
        The fiscal year 2002 request for ESCM is $1.291 billion. This
    total--an increase of $213.4 million over the fiscal year 2001 level--
    reflects the Administration's continuing commitment to protect U.S.
    Government personnel serving abroad, improve the security posture of
    facilities overseas, and correct serious deficiencies in the State
    Department's overseas infrastructure.
        For the ongoing ESCM budget, the Administration is requesting $475
    million. This budget includes maintenance and repairs at overseas
    posts, facility rehabilitation projects, construction security,
    renovation of the Harry S Truman Building, all activities associated
    with leasing overseas properties, administration of the overseas
    buildings program, and construction of a classified annex in Bogota,
    Colombia.
        In Worldwide Security Upgrades, the Administration is requesting
    $665 million for capital projects. This request will continue the
    program of relocating posts at highest risk begun with the fiscal year
    1999 emergency security supplemental.
        Funding will be used for the design and/or construction of about
    seven new embassies or consulates. Possible sites include Beijing,
    China; Cape Town, South Africa; Conakry, Guinea; Damascus, Syria;
    Harare, Zimbabwe; Phnom Penh, Cambodia; Sao Paulo, Brazil; Tashkent,
    Uzbekistan; Tbilisi, Georgia; and funding may also be used for a post
    opening in Medan, Indonesia.
        Capital projects funding will also be used to acquire sites at five
    to ten other posts for which design/construction funding will be sought
    in the outyears and to construct Marine Security Guard quarters at
    posts with new diplomatic compounds. Funding includes $50 million for
    construction of new on-compound facilities for USAID.
        In Worldwide Security Upgrades, the Administration is also
    requesting $150.9 million to strengthen perimeter security at 28
    additional vulnerable posts and meet recurring security support costs
    associated with the embassy construction and perimeter security
    program.
    Educational and Cultural Exchange Programs (ECE):
        The fiscal year 2002 request of $242 million for ECE will fund some
    of the U.S. Government's most effective international exchanges.
        Authorized by the Mutual Educational and Cultural Exchange Act of
    1961 (Fulbright-Hays Act), as amended, these strategic activities build
    mutual understanding and develop friendly relations between the United
    States and other countries. They establish the trust, confidence, and
    international cooperation necessary to sustain and advance the full
    range of U.S. national interests.
        The request provides $140.3 million for Academic Programs. These
    include the J. William Fulbright Educational Exchange Program for
    exchange of students, scholars, and teachers and the Hubert H. Humphrey
    Fellowship Program for academic study and internships in the United
    States for mid-career professionals from developing countries.
        The request also provides $72.6 million for Professional and
    Cultural Exchanges. These include the International Visitor Program,
    which supports travel to the United States by current and emerging
    leaders to obtain firsthand knowledge of American politics and values,
    and the Citizen Exchange Program, which partners with U.S. non-profit
    organizations to support professional, cultural, and grassroots
    community exchanges.
        The total request for ECE represents an increase of $10.4 million
    over the fiscal year 2001 level. While most of this increase is needed
    to cover built-in requirements (particularly federal pay raises), $2.2
    million will provide program enhancements for Fulbright, International
    Visitors, Citizen Exchanges, and global academic programs (including
    university partnerships, English teaching, and overseas educational
    advising).
    Other State Programs:
                Representation Allowances:
        The fiscal year 2002 request of $9 million will reimburse
    diplomatic and consular personnel in part for officially representing
    the United States abroad and before international organizations. The
    increase of $2.5 million over the fiscal year 2001 level begins to
    restore the buying power that has been lost in this account over the
    past twelve years.
                Emergencies in the Diplomatic and Consular Service (EDCS):
        The fiscal year 2002 request of $15.5 million increases support for
    the EDCS account by $10 million over the fiscal year 2001 level to help
    meet emergency requirements in the conduct of foreign affairs.
        Funding for this no-year account will cover the evacuation of
    American officials and their families from areas of political unrest or
    natural disaster. It will also pay rewards for information concerning
    international terrorism, narco-terrorism, and war crimes.
                          international organizations
    Contributions for International Peacekeeping Activities (CIPA):
        The fiscal year 2002 request for CIPA totals $844.1 million. It
    represents the U.S. share of the expenses of United Nations (U.N.)
    peacekeeping operations and provides for full funding of projected
    fiscal year 2002 operations.
        The request funds U.S. assessed contributions to continuing U.N.
    operations in Kosovo, Bosnia and Herzegovina, East Timor, the Golan
    Heights, Lebanon, Cyprus, Georgia, Western Sahara, Iraq/Kuwait, Sierra
    Leone, the Democratic Republic of the Congo, and Ethiopia/Eritrea. It
    also includes funding for the War Crimes Tribunals for the former
    Yugoslavia and Rwanda.
        U.N. peacekeeping operations serve the national interests of the
    United States by helping to support new democracies, lower the global
    tide of refugees, reduce the likelihood of unsanctioned interventions,
    and prevent small conflicts from growing into larger wars.
        Acting through the United Nations allows the United States to share
    the risks and costs of responding to international crises. Funding the
    U.S. share of assessed U.N. peacekeeping budgets ensures continued
    American leadership in shaping the international community's response
    to developments that threaten international peace and security.
        The Administration requests that 15 percent of these funds be
    appropriated as ``two-year funds'' because of the unpredictability of
    the requirements in this account and the nature of multi-year
    operations with mandates overlapping the U.S. Fiscal year.
    Contributions to International Organizations (CIO):
        The fiscal year 2002 request for CIO totals $878.8 million. It
    provides full funding of U.S. assessments, consistent with U.S.
    statutory restrictions, to 44 international organizations.
        The request recognizes U.S. international obligations and reflects
    the President's commitment to maintain the financial stability of the
    United Nations and other international organizations.
        The international organizations funded by the CIO appropriation
    further U.S. economic, political, social, and cultural interests. In
    addition to the United Nations, they include the World Health
    Organization, the North Atlantic Treaty Organization, the International
    Atomic Energy Agency, and the Organization for Economic Cooperation and
    Development.
        Membership in international organizations benefits the United
    States by building coalitions and pursuing multilateral programs which
    advance U.S. interests. These include promoting economic growth through
    market economies; settling disputes peacefully; encouraging non-
    proliferation, nuclear safeguards, arms control, and disarmament;
    adopting international standards to facilitate international trade,
    telecommunications, transportation, environmental protection, and
    scientific exchange; and strengthening international cooperation in
    agriculture and health.
                             related appropriations
    The Asia Foundation:
        The Asia Foundation is a non-governmental grant-making organization
    with a sustained presence in Asia and the Pacific. Its programs
    complement official efforts to advance U.S. interests in the region.
        Through its network of 14 small field offices, the foundation
    supports local groups and hands-on programs that build democratic
    institutions and leadership, develop non-governmental and regional
    organizations, and advance the rule of law and human rights.
        The fiscal year 2002 budget request of $9.25 million will enable
    The Asia Foundation to help develop stronger and more effective open
    market economies and support the adoption of sound governance practices
    on which the region's long-term economic recovery depends.
    East-West Center:
        The Center for Cultural and Technical Interchange Between East and
    West was established by Congress in Hawaii in 1960. It promotes better
    relations and understanding between the United States and nearly 60
    nations of Asia and the Pacific through research, study, and training.
        The fiscal year 2002 budget request of $13.5 million will assist
    the East-West Center's continuing programs to maximize regional
    cooperation and minimize conflict. The center is part of the overall
    U.S. public diplomacy effort directed toward a region with more than 50
    percent of the world's population.
    North-South Center:
        The Dante B. Fascell North-South Center, a private non-profit
    institution affiliated with the University of Miami, promotes better
    relations among the United States, Canada, and the nations of Latin
    America and the Caribbean. It is a national and regional source of
    information and analysis, serving as a catalyst for change.
        In fiscal year 2002, the Administration is requesting $1.4 million
    for the North-South Center in the Educational and Cultural Exchange
    Programs account (ECE). Funding will support programs that advance
    long-term U.S. interests and address multilateral needs, including
    strengthening democracy and encouraging open markets in the hemisphere.
    National Endowment for Democracy (NED):
        The National Endowment for Democracy is a private non-profit
    organization created in 1983 to strengthen democratic institutions and
    processes around the world. NED makes grants to numerous U.S.
    organizations for programs in such areas as labor, open markets,
    political party development, human rights, rule of law, and independent
    media.
        The fiscal year 2002 budget request of $31 million will help expand
    important democracy-building programs in Africa, the Middle East, the
    NIS, and Latin America. Funding will also support countries in
    transition, strengthen civil society, assist democratic activists in
    authoritarian countries, encourage free market reforms, and develop
    regional networks.
    Eisenhower/Israeli Arab Exchange Programs:
        The Eisenhower Exchange Fellowship Program promotes international
    understanding by bringing rising leaders to the United States, and
    sending their American counterparts abroad, on custom-designed
    professional programs.
        The Israeli Arab Scholarship Program fosters mutual understanding
    by enabling Arab citizens of Israel to study and conduct research in
    the United States.
        The two programs are supported by interest and earnings from their
    respective trust funds.
        There are of course many more details on our budget available, and
    I invite all of the Subcommittee members' attention to a most
    comprehensive pamphlet entitled ``United States Department of State:
    The Budget in Brief--Fiscal Year 2002.''
        And now, Mr. Chairman, I'm prepared to answer your and the members'
    questions.
                                     ______

                     Biographical Sketch of Colin L. Powell
        Colin L. Powell was nominated by President Bush on December 16,
    2000 as Secretary of State. After being unanimously confirmed by the
    U.S. Senate, he was sworn in as the 65th Secretary of State on January
    20, 2001.
        Prior to his appointment, Secretary Powell was the chairman of
    America's Promise--The Alliance for Youth, a national nonprofit
    organization dedicated to mobilizing people from every sector of
    American life to build the character and competence of young people.
        Secretary Powell was a professional soldier for 35 years, during
    which time he held myriad command and staff positions and rose to the
    rank of 4-star General. His last assignment, from October 1, 1989 to
    September 30, 1993, was as the 12th Chairman of the Joint Chiefs of
    Staff, the highest military position in the Department of Defense.
    During this time, he oversaw 28 crises, including Operation Desert
    Storm in the victorious 1991 Persian Gulf war.
        Following his retirement, Secretary Powell wrote his best-selling
    autobiography, My American Journey, which was published in 1995.
    Additionally, he pursued a career as a public speaker, addressing
    audiences across the country and abroad.
        Secretary Powell was born in New York City on April 5, 1937 and was
    raised in the South Bronx. His parents, Luther and Maud Powell,
    immigrated to the United States from Jamaica. Secretary Powell was
    educated in the New York City public schools, graduating from the City
    College of New York (CCNY), where he earned a bachelor's degree in
    geology. He also participated in ROTC at CCNY and received a commission
    as an Army second lieutenant upon graduation in June 1958. His further
    academic achievements include a Master of Business Administration
    degree from George Washington University.
        Secretary Powell is the recipient of numerous U.S. and foreign
    military awards and decorations.
        Secretary Powell's civilian awards include two Presidential Medals
    of Freedom, the President's Citizens Medal, the Congressional Gold
    Medal, the Secretary of State Distinguished Service Medal, and the
    Secretary of Energy Distinguished Service Medal. Several schools and
    other institutions have been named in his honor and he holds honorary
    degrees from universities and colleges across the country.
        Secretary Powell is married to the former Alma Vivian Johnson of
    Birmingham, Alabama. The Powell family includes son Michael; daughters
    Linda and Anne; daughter-in-law Jane; and grandsons Jeffrey and Bryan.

        Senator Gregg. Thank you, Mr. Secretary. I appreciate that
    background and especially your closing thoughts on the
    philosophy of how you plan to manage the Department of State,
    which is a critical Department.
        Let me begin by congratulating you for what you have done
    so far. I think you have brought an energy and vitality and
    renewed enthusiasm to the agency, which is extremely important.
    The way the Department handled the situation in China deserves
    the highest praise. It was a reflection of maturity and
    expertise that led to the defusing of what could have been a
    terribly difficult situation. So I certainly congratulate you
    for your leadership in that area and your team, especially the
    Ambassador to China.
        Secretary Powell. Thank you.
        Senator Gregg. We have a lot of issues on this committee,
    of course, surrounding your agency that we are concerned about.
    I have a number of questions. I will ask a couple and then move
    to Senator Hollings and Senator Murray, and we can go around a
    few times to get to all of them.

                         cost of peacekeeping missions

        I want to start out with the issue of peacekeeping. This
    appears to us to be a huge blank check that the American
    taxpayers are being asked to write. We have been supportive of
    the peacekeeping efforts, but we are concerned that
    peacekeeping is being driven by policies that are either not
    consistent with American policy or that are pulling American
    policy in a direction that is not necessarily where we want to
    go. This is especially true, it appears, in Africa.
        So I would like to get, first, your summary of where we are
    with respect to peacekeeping in Africa. I am also curious about
    the costs you project overall for peacekeeping for this coming
    year and where you expect the American taxpayer will have to
    pick up a significant bill for peacekeeping missions.
        Secretary Powell. It is an excellent question, Mr.
    Chairman, and I am glad to have the opportunity to speak to it.
        I wish there were a single statement that I could give
    about peacekeeping that would cover all of the different
    situations that we find ourselves in. But as a member of the
    United Nations--as a key and most important, frankly, member of
    the United Nations and the wealthiest member of the United
    Nations--we have an obligation to participate in the activities
    of that organization when it comes to peacekeeping operations.
        In almost every instance, it is a peacekeeping operation
    that we supported in the Security Council, and we voted for it,
    or else it would not take place in the first place. So there
    should always be some American policy interest in the
    particular peacekeeping operation that we are voting for in the
    Security Council.
        I think it is incumbent upon us when new operations come
    along to make a clear judgment as to whether our interest is
    being served as well as the interests of the United Nations and
    the interests of the country that is in question that is having
    the difficulty.
        When we have decided that a peacekeeping operation makes
    sense, that the circumstances are there so that the operation
    makes sense, and we go along with it and vote for it, then we
    have an obligation to support it, financially or in other ways.
        I prefer and the President prefers that we not provide
    troops to these operations if there are other troops that are
    available. A good example of a peacekeeping operation that I
    think meets this model and has gone very well is what we have
    been doing in East Timor, where we have provided political
    support, diplomatic support, and we have provided funding.
    There is a clear endpoint to this particular operation, and our
    colleagues in the region have provided the military and other
    on-the-ground leadership, the Australians in particular. That
    is an example of the kind of peacekeeping operation, and I
    think it is clear, and it is very, very deserving of our
    support.
        They do not all come out as neatly as that. The ones in
    Africa are particularly difficult because of the circumstances
    that we are going into. If you take a look at Sierra Leone, it
    is perhaps one of the most challenging. You have the RUF, the
    insurgents, a very rowdy band of criminals, insurgents,
    terrorists and all kinds of other things. The United Nations
    felt an obligation, and we supported the United Nations in
    going into Sierra Leone with peacekeepers--not U.S.
    peacekeepers, but peacekeepers--to try to bring the RUF under
    control, to try to train the Sierra Leone armed forces so they
    can handle this with their own resources. It is a tough one. It
    is a tough one that does not have a clear endpoint, in my
    judgment, but it is one that we supported at the beginning, and
    I think we have a continuing obligation, and we acted on that
    obligation recently when we supported the increase in the
    number of peacekeepers going in.
        Will it end as neatly and as quickly, and is there an exit
    strategy that is as clear as we might see in East Timor? No.
    But is that a reason to totally walk away from a nation and a
    group of people who are in desperate straights, who have been
    subjected to the worst kind of atrocity and cruelty?
        Similarly in the Democratic Republic of the Congo, this is
    another case where you have a much more complex situation, and
    it is a little harder to see what the outcome is liable to be.
    But, in many of these instances, you are going to have to go in
    and try to do the best you can, and the United States has an
    obligation to participate in such missions.
        The President has made it clear--he made it clear in the
    campaign, and he has made it clear since he became President--
    that we will be looking at all of these in a far more critical
    way to make sure that we have a foreign policy interest
    associated with the particular peacekeeping operation and that
    we believe it is going to be run in a way that makes sense and
    will solve the problem we started out to solve. And, as he has
    also indicated in many instances, he will try to minimize U.S.
    troops actually committed to such operations--not that we are
    afraid of such operations, but the United States armed forces
    are stressed with deployments all around the world, and as you
    know, Secretary Rumsfeld is reviewing all of those now with the
    intent of getting some back.
        Sometimes it is not the United Nations; it is more of a
    NATO mission, such as we have in Bosnia and Kosovo. I was
    recently there and saw what those troops are doing. We are
    working hard to reduce the number of U.S. troops in these
    areas, Bosnia and Kosovo, but it is also clear that we are the
    glue that is holding this fragile situation together, so we are
    not going to be able to just say, well, we have had enough, and
    come out and leave, and leave our NATO colleagues who are in
    there, counting on us, and we are counting on them, and they
    are providing the bulk of the force and doing a heck of a job.
    So there are these fragile situations where the answer is not
    as clear.
        The amount of money going to all of these operations is
    rather significant. It is in the billions, as you know; and I
    will be delighted to provide the actual breakdown for each and
    every one of them. As you know, once one of these things is
    approved by the Security Council, we immediately have a 25
    percent capped obligation to support them, an obligation that
    we are trying to move up to 28 percent so that we do not accrue
    new arrears as to what we are capped to provide and the actual
    cost of such operations and the allocation assigned to us by
    the United Nations.
        Senator Gregg. Do you have an estimate of how much it is
    going to cost us to continue the operations in Sierra Leone and
    initiate operations in the Congo?
        Secretary Powell. I will have my staff look that up while
    we are continuing the dialogue, if I may, Mr. Chairman.
        Senator Gregg. We are working under a time frame here, and
    I think my time for the first round has probably expired.
        Senator Hollings.
        Senator Hollings. First, to the point, you are to be
    congratulated on restoring the morale at your Department and
    providing us with a realistic budget. We have been downsizing
    and neglecting--other than peacekeeping and security--diplomacy
    and foreign policy.
        To the point, though, you say you have looked critically--
    because you know we listened to President Bush in the
    campaign--at getting out of Bosnia and Kosovo and cutting back
    our peacekeeping missions overseas. You indicated in your
    comments, that you are going to have a critical review of some
    14 of them. Then, Senator Gregg and I go to the Defense
    Appropriations Subcommittee, and Defense says the trouble is we
    are stretched too far, morale is low, that we do not have an
    adequate defense, and that we are no longer a two-army system
    because of peacekeeping.
        You were Chairman of the Joint Chiefs, and now you are
    coming around the corner, meeting yourself, saying whoopee for
    the 14 peacekeeping operations, and requesting $318 million for
    Sierra Leone----
        Secretary Powell. Yes.
        Senator Hollings. How do we get that? We have only $122
    million for Kosovo, and we had a war there. I have been to Camp
    Bondsteel in Bosnia. That is quite a commitment. We built up a
    billion-dollar facility there. Now, we have almost three times
    as much for Sierra Leone?
        Secretary Powell. That is the case at the moment. To answer
    the chairman's question, it is $83.5 million for the Congo and
    $318 million for Sierra Leone.
        Senator Hollings. And you looked at that, and that is how
    much is necessary for Sierra Leone?
        Secretary Powell. That is our obligation at the moment.
        Senator Hollings. And you endorse all 14 operations--East
    Timor is even more than Kosovo, too. That is $130 million.
        Secretary Powell. And that one I think is going rather
    well.

                          cost of Embassy construction

        Senator Hollings. I want to get into detail, if the
    chairman will permit, in just one other subject with respect to
    the cost of embassies--and I commend you for getting General
    Williams on board. It strikes me that these facilities are
    awfully expensive. Who ever heard of spending $97 million in
    Tashkent? Have you ever been there?
        Secretary Powell. No, sir.
        Senator Hollings. Well, you ought to go. I mean, you ought
    to be able to buy the place for $97 million.
        And then, Tbilisi, Georgia, $95 million; Phnom Penh, $65
    million; Zimbabwe, $86 million. I have got to sit down with the
    General and find out where he got all these expenses. I do not
    want to take the subcommittee's time.
        But we look and we know--for example, when I went down to
    Brazil earlier this year, I had the dog-and-pony show from the
    Ambassador about the important facility at Rio. I have been
    there several times, and when I got there, I found that we have
    a 10-story building and 27 personnel. The AID people wanted
    out; the Navy commander who escorted me around said he could
    move into those fine facilities with the Brazilian navy. In
    their replacement, they wanted to by a facility for $100
    million that has the same dangerous kind of condition that was
    the basis for your Department wanting to move out of the
    facility in Istanbul. They said we had to get a new facility
    because you could look down into the facility and, with a
    rifle, maybe shoot into the window or something. That is what
    they wanted to buy in Rio, and that is what they wanted to sell
    and get rid of and establish a new one in Istanbul.
        We have got to get around and look at these costs.
        Secretary Powell. I could not agree more, Senator Hollings,
    and that is what General Williams has been charged to do. In
    some instances, we are bound by requirements given to us by
    Congress. When you look at the Inman report and the Crowe
    report, they create standards for the construction of embassies
    to provide for security against the threats that are out there.
    The two East Africa bombings a couple of years back--who would
    have predicted that that is where somebody would have bombed
    us--but they found vulnerabilities, and they found weaknesses.
        So you cannot say that an Embassy in a place that seems to
    be rather quiet is safe. You have to look at each and every
    one.
        There are also requirements associated with who can
    actually build a secure facility for us. In many instances, we
    have to bring it all over from the United States--the
    communications requirements, the power requirements, all the
    other security issues associated with the construction of an
    Embassy run the costs up rather significantly. And General
    Williams has it as his charge to take a look and may well be
    coming back to the Congress to ask for some relief from some of
    the requirements that exist, because it is not clear that you
    really need this in all instances around the world.
        So I am very anxious to work with the committee and other
    committees of Congress to help drive these costs down, and that
    is General Williams' charge, to find ways to drive the costs
    down.
        What may be fine for the Brazilian navy may not be fine for
    the American navy coexisting in a similar facility because of
    security requirements or other requirements.
        Senator Hollings. Thank you, Mr. Chairman. I will come
    back.
        Senator Gregg. I completely agree with Senator Hollings'
    concern here, and I appreciate the focus that you are putting
    on it. I am almost of the opinion that we should probably have
    a special hearing just on these building costs. These Embassy
    costs have just gotten outrageous.
        Secretary Powell. Yes, they have; I am not disputing that.
        Senator Gregg. What is the number now for Beijing?
        Secretary Powell. It was in the hundreds of millions the
    last I checked.
        Senator Gregg. I thought it was closing in on $1 billion,
    actually.
        Secretary Powell. It is well over $600 million.
        Senator Gregg. We have got to figure out some way to
    address this, and if there are congressional mandates, we need
    to review them.
        Senator Murray.
        Senator Murray. Thank you, Mr. Chairman.
        Mr. Secretary, I join my colleagues in welcoming you here,
    and I would be remiss if I did not take this opportunity to
    invite you to my State. We are a very internationally-engaged
    community. Our trade is very important to my State. We have a
    number of sister city relationships. I think that we send more
    men and women to the Foreign Service than most States do--many
    of them retire back in my community--and for every issue you
    consider on a daily basis, I have constituents who are debating
    it somewhere at home, and we would love to have you come and be
    a part of that conversation.
        Secretary Powell. Thank you, Senator.

                    china's bid for the 2008 summer olympics

        Senator Murray. Mr. Secretary, let me first take this
    opportunity to commend you for the handling of the recent EP-3
    incident in China. It came very close to home. I live on
    Whidbey Island, where our service men and women are stationed,
    and on behalf of my neighbors and my constituents, we
    appreciate the job that you did in bringing our service men and
    women home. We are all very, very proud of them.
        I think we have to continue to convey our disappointment to
    China on this issue, but I think we are really at a very
    delicate point, and I think we have to be very cautious in
    sending any message. I think we need to recognize that our
    words and deeds do have long-term consequences that will
    directly affect U.S. interests at this time.
        I understand that the House of Representatives is likely to
    take up and pass legislation that will oppose China's bid to
    the 2008 Summer Olympics, and I know that this week, the U.S.
    Commission on International Religious Freedom presented you
    with a report recommending that the U.S. Government oppose that
    bid.
        What do you think would be the long-term effect on United
    States-China relations if the United States is viewed by both
    the Chinese Government and the Chinese people as having stopped
    the Beijing Olympics bid?
        Secretary Powell. I am sure the Chinese Government and the
    Chinese people would be very, very unhappy and very
    disappointed. But there are other nations that are also bidding
    for the Olympics that are going to be very unhappy and
    disappointed if they do not get it.
        We have taken no position on this within the
    administration, and essentially it is an independent judgment
    by the International Olympic Committee, although I am sure they
    would be interested in what the Congress and the administration
    might say.
        We are trying to calibrate a response to this incident in a
    very, very careful way to make sure we do not cut off our nose
    to spite our face, and I think we have done rather well. The
    Chinese now have allowed our assessment team onto the island,
    and the assessment team is at work this morning; we had a
    meeting on this this morning. I think we will get past this,
    but we should have no illusions about the nature of the regime
    that exists in Beijing. It is a totalitarian government; they
    can turn human rights on or off as it suits their purpose. They
    can act in ways that we find very distasteful, and when they
    do, we should point it out to them and not let them get away
    with it, but at the same time recognize it is a nation, a
    powerful, strong, proud nation, in transition and
    transformation, and we should work with them to try to bring
    them into the international community.
        Senator Murray. On the question of the Olympics, then, I
    assume the administration is not going to take a position.
        Secretary Powell. We have not decided----
        Senator Murray. You have not decided.
        Secretary Powell [continuing]. Whether we will or will not.
        Senator Murray. Let me just read you a couple of quick
    items from the International Olympic Committee's Code of
    Ethics. They state that ``The Olympic Games are competitions
    between athletes in individual or team events and not between
    countries'' and that ``the Olympic parties shall neither give
    nor accept instructions to vote or intervene in a given manner
    with the organization of the IOC.''
        I think it is really important that we take this issue very
    seriously and abide by the rules of the International Olympic
    Committee. I think we all recall the last time the United
    States allowed our relations with another country to interfere
    with the Olympic movement. A number of Olympic games were
    affected, including the 1984 Los Angeles games, where we had
    athletes who lost their opportunity to participate.
        And U.S. foreign policy is still dealing with the
    ramifications of allowing politics to enter into the Olympic
    arena. You can talk to any wheat farmer in the State of
    Washington, and they will tell you about mixing politics with
    the Olympics.
        So I think I would just like to tell you the seriousness
    with which I view this and to really caution all of us to be
    very careful as we use words and the administration determines
    how they are going to handle this.
        Secretary Powell. I understand, Senator. Thank you.
        Let me also, through you, thank and congratulate the
    wonderful young men and women who did such a great job getting
    that plane on the ground and how they comported themselves
    during the 11 days that it took us to get them home.
        Senator Murray. Yes. We are all very proud of them.
        Secretary Powell. We all should be.
        Senator Murray. Thank you very much.
        Senator Gregg. Senator Mikulski?
        Senator Mikulski. Thank you very much.
        Secretary Powell, how wonderful to see you again.
        Secretary Powell. Nice to see you, ma'am.
        Senator Mikulski. I again wish to extend my hand to you to
    work to really advance American values around the world. I like
    the way that, in your testimony, you talked about your CEO
    responsibility and then these global policy issues.

                 adequate support for foreign service officers

        On CEO responsibilities, I have the good fortune that a
    significant number of your Foreign Service Officers live in
    Maryland; they make Maryland their home as they do service
    abroad. This goes to my question. Looking at how we can keep
    our embassies secure, of course, is a key priority. But do you
    feel that in this year's budget we have done two things--one,
    in terms of our Foreign Service, are there adequate moneys to
    really be looking at pay, health care, pensions, and issues
    around spouses? And two, are we addressing demands on our
    embassies and our consulates? I think the consulates are among
    the most stressed-out operations within the State Department,
    with students abroad, more desire for business activity, more
    people traveling, and more places in the world open for
    Americans to travel.
        So I would like very much to play a role with you, to be
    sure, about our professional FSOs, but in addition to really
    look at the number and the support to the consulate offices.
        Secretary Powell. Thank you, Senator. I think you are
    absolutely right.
        Senator Mikulski. Because that is where Americans come in
    contact with----
        Secretary Powell. That is where they see their United
    States Government out there, when they have lost a passport or
    they have a problem of some kind, or they want to learn about
    the United States or want to come to the United States. I think
    we can do a much better job--and you are quite right, Maryland
    has been a great host for not only our Foreign Service
    employees but for so many of our civil service employees as
    well. I always like to put the two together and then add our
    Foreign Service nationals; it is all one family, one team,
    around the world.
        In this year's submission, I think we have a start on that
    problem. As I indicated in my opening statement, we have a lot
    of work that needs to be done, and as Senator Hollings
    mentioned earlier, we have not spent enough on this over the
    years. So I hope that I will be back here next year with the
    President's permission and with OMB's permission to make a case
    for even more resources for just the kinds of things you said,
    to make sure that people are getting what they need to do the
    job--and it isn't just $318 million going to Sierra Leone, but
    that we are taking care of all of our people around the world
    and their families. We just started a pilot program for spouse
    employment in Mexico City, and there are a lot of other things
    we are trying to do to make families more satisfied with their
    service overseas.
        Senator Mikulski. Well, I would really look forward to
    working with you, and judging from your answer, you are saying
    that this year's request is a down payment----
        Secretary Powell. A start, yes.
        Senator Mikulski [continuing]. And that over the next years
    that each year, we will look at how to upgrade and expand this
    most important service to both the Nation and to our people.
        Secretary Powell. Exactly right. I think the President was
    quite generous to the State Department in this first year of
    his administration, and he has indicated to me that if I come
    back and make the case, he will examine the case very, very
    carefully for future years.

                              middle east affairs

        Senator Mikulski. Now I would like to go into some foreign
    policy issues as well. Mr. Secretary, the issues around the
    great State of Israel, of course, are indeed complex and
    compelling, and we appreciate where you are heading.
        My question is that there seems to be a need for
    supplemental assistance to Israel in the area of military
    expenditures. Is the administration planning to send a
    supplemental expenditure up, and also some robust activity to
    move the Jordan Free Trade Agreement forward?
        Secretary Powell. Starting with the second point, we are
    very committed to the Jordan Free Trade Agreement. Jordan needs
    this agreement. Jordan is a good friend of the United States.
    Jordan plays a very key role in the region, especially now
    during these difficult times. So we are anxious to see that
    agreement come into force and be passed.
        Mr. Zoellick, our Trade Representative, is hard at work
    examining that one plus a number of others that are out there,
    as well as trade preference authority, to see whether we should
    package this or we should start moving them one at a time. I
    will leave it to Bob to figure out the answer to that question,
    but you can be sure that the President, this Secretary of
    State, and Mr. Zoellick are fully behind the Jordan Free Trade
    Agreement and will do everything we can to get it passed as
    quickly as we can, consistent with our other free trade needs.
        Senator Mikulski. I think there is strong bipartisan
    support.
        Secretary Powell. Yes, I see that; I have sensed that.
        Senator Mikulski. What about the supplemental issue?
        Secretary Powell. On the supplemental, I am well aware of
    the need that the Israelis have. We have discussed it with
    them, and at the moment, we do not have a proposal up here yet.
    It is something that we have under consideration, but it has
    not yet been acted on for submission to the Congress.
        Senator Mikulski. One last question. Has my time expired?
        Senator Gregg. No. Go ahead and ask the question.

                            special envoy to cyprus

        Senator Mikulski. On special envoys, the issue of Cyprus
    goes back, as you know, to another way you served the Nation.
    What is the administration's plan and your plan on being able
    to move on a continued special envoy on Cyprus and plans to try
    to resolve this issue? It has significant consequences.
        Secretary Powell. As you know, we are at a bit of an
    impasse right now because of the position taken by Mr.
    Denktash. We are supporting the U.N. efforts on this. At the
    moment, I am examining the whole issue of special envoys. When
    I took over, I discovered that we had over 50 special envoys
    and ambassadors-at-large here and there, and in order to sort
    of clean up things and start fresh, I eliminated quite a number
    of them. Some are in law, and they were not eliminated, and
    some are doing very, very useful work.
        I want to continue to examine Cyprus a bit longer to decide
    what best we can do with respect to our representation to move
    that process along. I have not made a decision yet.
        Senator Mikulski. Well, we would like to hear more about
    that.
        Secretary Powell. Yes.

                             trafficking in humans

        Senator Mikulski. Another area where we have bipartisan
    agreement has been on passing the Trafficking Victims
    Protection Act. This is legislation that Senator Brownback,
    Senator Kay Bailey Hutchison, myself, and others have been
    working on. You might not be familiar with this, because the
    legislation passed last year, but it is something in the world
    that I know you will find so repugnant if you are not already
    aware of it. It is the trafficking of women and children--out
    of Asia, in the Ukraine, et cetera.
        I wonder what efforts you have underway to implement the
    Act, and if you have not given it consideration, if you could
    review it.
        Secretary Powell. We will implement it in tone and intent.
        Senator Mikulski. Because it really does not come under the
    classic human rights, but----
        Secretary Powell. It really should--it is an abuse of human
    rights in the most fundamental sense.
        Senator Mikulski. Truly. And also on a human rights issue,
    I would hope we would continue to be working with Israel in
    terms of their missing soldier situation, with perhaps the
    encouragement of Red Cross.
        Secretary Powell. Yes. Foreign Minister Peres and I
    discussed that yesterday.
        Senator Mikulski. Thank you, Mr. Chairman.
        Senator Gregg. Senator Stevens.
        Senator Stevens. Pardon me, Mr. Secretary. Good morning.

                    china's bid for the 2008 summer olympics

        I understand the Senator from Washington has made some
    comments about the Olympics. That is what I came over here for.
    I am involved in a little bit of an extracurricular activity
    called ``the budget'' right now, but I did want to come and
    greet you and thank you for coming.
        Secretary Powell. Thank you, sir.
        Senator Stevens. I too believe that the current crisis with
    China is one thing. But keeping the Olympics out of disputes
    between individual countries is a policy that this
    administration should adopt and pursue. I hope it will be your
    policy to not let our current relationship with China interfere
    with the decision of the International Olympic Committee as to
    where the Olympics will be held.
        Secretary Powell. As I said to Senator Murray, I am very
    sensitive to that, and we have made no decision with respect to
    this issue. We have talked about it when we had the crisis on
    our hands a few weeks ago; obviously, you would expect us to
    look at the full range of alternatives. Right now, we are
    anxious to get the relationship back on an even keel so we can
    move forward and work in areas with which we agree with the
    Chinese and work in areas where we disagree with the Chinese.
    So no decision has been made about what the United States might
    or might not do with respect to the Olympics.
        Senator Stevens. I told a group this morning that, in case
    they did not realize it, my home is just about the same
    distance from Peking as it is from where we sit right now. We
    have people who fly out of Anchorage daily to somewhere in
    China and return, with both FedEx and UPS and other carriers
    going through there daily.
        I am alarmed at some of the comments we are hearing about
    the muscle that the Chinese military is flexing in terms of
    civilian matters. Would you care to comment on that? Is that
    perception wrong, that the military, as reflected in the EP-3
    instance, was using extreme muscle and really interfering with
    the normal civilian relationship between our countries?
        Secretary Powell. The People's Liberation Army is more than
    just an army. It is an organ of power within that state. As we
    went through the EP-3 incident, I could see that the Chinese
    Foreign Ministry as it tried to handle that matter had to be
    enormously sensitive to the interests and equities of the
    People's Liberation Army.
        As you know, it is deeply involved in businesses, although
    recently, Chinese leaders have been trying to get the army out
    of business.
        So I do not think they are in a position of overruling what
    their civilian masters would choose to do or want to do. But,
    it is also clear that the civilian leaders, party leaders,
    political leaders, and the bureaucracy within the Chinese
    Government have to take into account very seriously the views
    and attitudes of the People's Liberation Army, and we could see
    that both in the circumstances we went through to get our young
    men and women out, and also we can see it as we work on getting
    our plane out.

                   secretary's comments on middle east visit

        Senator Stevens. I am sorry to have been late, but have you
    commented on your trip through the Middle East and what the
    situation is there, as you see it?
        Secretary Powell. No, but I would be pleased to take a
    moment to do that, sir. I met with Foreign Minister Peres
    yesterday for a long period of time, and I also met with
    Foreign Minister Gutter, and I meet with leaders from the
    region on a regular basis. What is absolutely clear to me is
    that there has to be a reduction in the level of violence in
    the region before we can move forward to improve the economic
    situation of the Palestinians and before we can move forward to
    getting back on track toward negotiations for peaceful
    resolution of this crisis.
        Many people say, well, let us start negotiating right away,
    but it is clear to me, and I think it is clear to most of the
    leaders in the region, that the two sides are not going to be
    able to conduct fruitful negotiations under the conditions of
    violence that currently exist.
        When Mr. Peres was here yesterday, he described, and then
    he and I gave a press conference describing some ideas for
    negotiations that had been presented by the Jordanians and the
    Egyptians and the Palestinians that the Israelis are working
    with. So they are talking to each other about what they might
    do in a negotiation when they are able to get to a negotiation,
    but they are not going to be able to get to a negotiation until
    the level of violence has gone down. And that has been our
    consistent message to both sides, that leaders on both sides
    have to take every action within their power to restrain the
    passions that exist in the region and to call on their
    followers to foreswear violence, to knock it off, to bring it
    back down, not to zero--we will not get it to zero--but to
    bring it back down to a level where we can start building
    confidence again so that people are then willing to take
    chances for peace.
        The United States is heavily involved in this. I spend a
    large amount of my time speaking to leaders in the region,
    calling them on the phone day and night; the President spends a
    large amount of his time doing the same thing. So we are deeply
    engaged, but we have to make sure we understand that we are not
    going anywhere until the level of violence starts to go back
    down.
        We are sponsoring two sets of security consultations at the
    moment between the Palestinians and the Israelis. Those
    consultations back and forth are starting to show a little bit
    of progress. There is a little bit of traction. But this little
    bit of traction will not really be enough unless the level of
    violence goes down.
        I am repeating myself for purposes of the public audience
    out there and in the region. You have got to knock it off if
    you want to get back to discussions on permanent solutions and
    on peace.
        Senator Stevens. I can only make one last comment. Some of
    us were with Minister Peres yesterday, and he told us that he
    had had to request to move $1 billion from the civilian
    accounts to the military accounts in order to counter the
    current level of military activity in the region.
        When I was in Greece earlier this year, it was suggested to
    me that the trade between the countries in the Middle East is
    almost nil now and that if we had a role, perhaps we should try
    to find some way to restore the trade and urge some way to
    establish a free trade zone there between those countries.
    There may be some way they could get back together in terms of
    providing employment and jobs for their people, rather than
    this escalating violence. I would just pass it on to you for
    what it is worth.
        Secretary Powell. Mr. Peres and I talked about that
    yesterday. It would be terrific if we could see trade
    opportunities for the Jordanians on the West Bank. If the
    Jordanians had access to more markets on the West Bank, it
    would solve a large part of their financial problem right now.
    And Mr. Peres also said that the Sharon Government is going to
    be acting more aggressively to provide more work permits and
    access points to get through for Palestinian workers to come
    back to their jobs in Israel, so that we can get some flow of
    money going back and forth.
        I have every reason to believe that if the level of
    violence goes down, the Israelis will be very forthcoming with
    respect to starting up economic activity, because at the end of
    the day, the economic activity that is not taking place now,
    the lack of that economic activity not only hurts the
    Palestinians, but it is also hurting the Israeli economy. So
    that is step two, but step one has to be lowering the level of
    violence.
        Senator Stevens. Thank you very much, Mr. Secretary.
        Thank you, Mr. Chairman.
        Senator Gregg. Thank you, Mr. Chairman.
        Lowering the level of violence--I was wondering if you
    could----
        Senator Stevens. See if you can pass that on the Budget
    Committee, will you?
        Senator Gregg. That is impossible.

                           situation in iran and iraq

        Mr. Secretary, I was wondering if you could give us your
    thoughts on what is happening in Iran and Iraq.
        Secretary Powell. Let me start with Iraq. We have a country
    that was put under a regime 10 years ago, a very simple regime,
    that said if you foreswear weapons of mass destruction and
    trying to develop weapons of mass destruction, you could be
    welcomed back into a community that would be interested in the
    welfare of your people. You have enormous wealth in your oil
    resources and revenue, if only you would use it for productive
    purposes.
        Unfortunately, Saddam Hussein is still the same person he
    was 10, 12, 15 years ago, and wastes the treasure of his
    people, the treasure of his nation. So we are absolutely
    committed to imposing the sanctions that were passed by the
    United Nations directed against his weapons of mass
    destruction.
        I have been hard at work for the last several months with
    the members of the P-5, the United Nations and with Arab
    leaders in the region to reshape those sanctions so that
    everybody can see that those sanctions are clearly targeted at
    the weapons of mass destruction and are not targeted at
    commodities and goods for the Iraqi people.
        Our argument is with Saddam Hussein, his regime, and those
    weapons of mass destruction and not with the Iraqi people. The
    case we have been making to the people of the region to the
    ``Arab street,'' as it is sometimes called, is that we are
    doing this to help you because he is developing those weapons
    of mass destruction not to aim at us but to aim at you, so it
    is in your interest to support the United States and the United
    Nations in this effort to have him come into compliance with
    the obligations he undertook at the end of the Gulf War.
        He has not been able to rebuild his forces. He is not able
    to project the kind of power he was 10 or 12 years ago, so
    Desert Storm did what it was supposed to do. It kicked his army
    out of Kuwait, and it brought him down to size. He is still a
    danger. He is still in a nation that we have to watch
    carefully. And he will not get out from under these sanctions,
    if the United States has anything to do about it, until he
    allows inspectors back in and behaves. We will keep control of
    the oil-for-food money, and we will do everything we can to
    stop leakage of that money, or other money, that he may acquire
    through sales of oil, leakage out of U.N. control. And we have
    some interesting ideas about how to do that.
        We will also keep in place the no-fly zone that exists, and
    we will also continue to work with Iraqi opposition groups that
    believe a regime change is the right answer.
        With respect to Iran, it is going to be very interesting in
    the upcoming election to see if the gentleman considered
    reasonably moderate by Iranian standards, Mr. Khatami, is
    actually going to participate in the election and run again.
        I think that Iran is a nation that has enormous treasure,
    an educated population, and has all the potential to enter the
    international marketplace, the international world, and be
    successful. Yet, it continues to hang onto an ideology that is
    not a political ideology that is really not relevant to the
    21st century, and they continue to find that it is in their
    interest to try to develop nuclear weapons and weapons of mass
    destruction, thinking that this will give them a position of
    power in the region and in the world when, at the end of the
    day, it will not, because we will contain them and we will
    deter them.
        We are working with a number of countries to try to cut off
    access to this kind of technology. Obviously, we are concerned
    about North Korea, which provides this kind of technology, and
    frankly, we have had some very direct conversations with the
    Russians about this sort of spread of technology to Iran.
        So we will have to watch Iran, be willing to engage when
    they show that engagement makes some sense. Wish the Iranian
    people the best, but be very guarded with respect to Iranian
    leadership. Keep in place the sanctions that we have put in
    place--as you know ILSA is coming up for reauthorization in
    August, and we will have some thoughts about that to share with
    the Congress and move forward together. But these two regimes,
    Iraq and Iran, are dangerous, have to be contained, and are
    out-of-step with the way the world is going, and it is a
    tragedy to see them waste the resources that they have in the
    pursuit of these evil technologies that threaten the region.
        Senator Gregg. Thank you.
        Just quickly, the Secretary of Defense suggested that we
    withdraw the American troops that are in Sinai.
        Can you tell us whether you support that position?
        Secretary Powell. The Secretary of Defense is reviewing
    that. At the moment, as you know, that mission is not a U.N.
    mission; it is a mission that is run by the United States,
    Israel and Egypt as a result of the agreements that were
    entered into in 1979.
        The size of that mission has come down over time. I would
    like to eventually see it go away. I have been to the Sinai,
    and I have seen those troops. It is not a very exciting
    mission, and it costs something. I would like to see it go
    away. At the moment, however, we have an obligation to Israel
    and to Egypt to support that multinational force.
        So Mr. Rumsfeld is reviewing it along with all the other
    deployments to see if there is a way to do it with fewer
    troops, to do it in a different way, to do it at less cost, but
    at the moment there is still a diplomatic and political
    necessity to keep a presence of some kind in the Sinai in
    accordance with the obligations we picked up in 1979.
        Senator Gregg. Thank you, Mr. Secretary.
        Senator Hollings.

                         asian-united states relations

        Senator Hollings. Mr. Secretary, Senator Stevens asked
    about the influence of the military in China with respect to
    getting that plane back. But this is another country you want
    to watch, they are having a dickens of a time trying to get $1
    billion more for their education budget, their military is
    coming along with $25 billion more, they have deployed
    militarily in 14 countries around the world, they have brought
    in from the military-industrial complex the Secretary of
    Transportation, and now they have the Joint Chiefs of Staff
    from the military in charge of foreign policy. You have got to
    watch that country.
        I just cannot go along with the idea that we have got to
    make China the enemy. We watch it with care, but don't make it
    the enemy. I went some 20 years ago with Lee Kuan Yew--
    Mansfield said he is the ``wise man of the East''--and we were
    talking about the military and how we could not afford, here in
    the United States, all of this military and that we had to
    share that burden. And we were talking about not wanting Japan
    to build up an army or an air force, but maybe a navy. I
    suggested to give them from Okinawa down past the Philippines
    into Australia, let them go to Bali--they did not have to
    worry--and we would take on up around Korea and Vladivostok.
        And the prime minister said, ``But Senator, you should not
    give them nuclear.'' And I was sort of taken aback, because I
    was not even thinking about that, but I said, ``Would you give
    the Germans nuclear?'' and he said yes. But he said never give
    the Japanese nuclear. He said they do not think they lost that
    war. It is taught in the schools today that they did not lose
    that war, and historically, they have been the aggressor in the
    East, not China.
        Then, jump to the reality of our experience in Korea and
    the reality of our experience in Vietnam, where you served. I
    remember a conversation with you--yes, the United States has
    all these tinkertoys, all this technology and so on, we had the
    flame-throwers, the helicopters, the B-52s and everything
    else--but the Vietnamese were on foot and beat the hell out of
    us.
        So as we puff and blow about what we are going to do, ask
    yourself how many in the Congress are going to vote to commit
    troops again in that area.
        With respect to their activity running that country, I have
    some little, very, very minute--maybe it is mistaken--
    understanding. I know that Tiananmen Square was brutal, and we
    all abhorred it, yet I ask myself how do you run a country with
    a population of 1.3 billion.
        I remember when I was Governor of South Carolina and had
    the dichotomy of the law saying you could not take over the
    streets--all the marry-ins, bed-ins, sit-ins--that is what the
    law said. But President Kennedy at that time said if they do
    not have recourse in the courts or in the Congress, they only
    have the streets of America.
        So I was in between the devil and the deep blue sea, and I
    adopted the old 12th Roman Canon, ``Salus populi supreme lex,''
    or ``The safety of the people is the supreme law.'' And I was
    running around arresting and holding up people. I will never
    forget the lawyer for Woolworth's and what he was going to do
    in the Supreme Court. I told them to send down Chief Justice
    Earl Warren, and I would lock him up. I was in charge as
    Governor of the State.
        And so it was that we had no one hurt and no life lost in
    South Carolina. I wonder if you had some demonstrations here,
    there, or yonder, in China, and it got the least bit out of
    control--with 1.3 billion, within a year's time, it would be
    totally out of control. And at the same time, we are working
    our way--capitalism is defeating communism. That is what really
    prevails over the Soviets, and it is working. And as you said,
    our foreign policy--do not get all puffed up like some around
    here who use it pollster-wise as a political issue to get
    themselves elected--they are strong, they are against the reds,
    they are against communism and all that--but they have no idea
    of sending troops over there. We are deploying and puffing and
    blowing.

                       Embassy construction requirements

        Otherwise, get to the construction projects that we have,
    Mr. Secretary, on course--not just the new projects. For
    example in Moscow, if you go over there in the winter time,
    they have a lot of adoptions going on, and U.S. citizens are
    standing out on the streets, freezing. The adoption process
    takes around 3 weeks, where you have got to check in and stay
    and do this, do that, and so on. Our consulate is working
    around-the-clock. They are doing a magnificent job, but they
    need a facility, and they need it quick, more than Tashkent and
    security in Tashkent. We have got to get General Williams on
    the stick and have him set some priorities and get Moscow
    completed right away.
        Otherwise, go to Lebanon. I know there are some realtor
    developers, because I have been there, and they want to go way
    out on the edge of town, because that will get them a new
    development, and if they can get the American facility there,
    they can make money. It is like building a golf course and
    selling the lots. If they can get you, then they can sell the
    lots.
        But I have seen the facility that we stopped construction
    on. It is all right on three sides. But, on the back side, they
    could aim down, but tell them to get that contractor in
    Caracas, Venezuela who built the back side of the Embassy
    there. We paid a fortune for a particular site in Caracas so
    that you could look down the valley--but he built it with no
    windows so you cannot look down anywhere. If you just wall it
    off, seal it off, on that back side, you have a good facility,
    and you have construction started, and it ought to be completed
    so it would be available. Otherwise, you will have to go way
    out where nobody can get to it there in Lebanon.
        Chairman Gregg's staff has been down to look at the
    facility in Sao Paulo. I want to get a report from General
    Williams on that, because it seems like that building could be
    used. Do not tell me they have glass--everything--the State
    Department has glass. But it is right in the city, it is a
    beautiful site, and rather than tear it down, it seems to me it
    could be secure now. I am not all that wedded to Admiral Inman
    and General Crowe. We live in the real world, and they would
    have gotten rid of the Buenos Aires facility, and now they are
    very happy with it. You cannot build ``fortress America''
    everywhere and get into $100 million projects. That is really
    bothersome.
        I will yield with that, Mr. Chairman. Thank you.
        Senator Gregg. Thank you. Did you want the Secretary to
    respond on any of those points?
        Senator Hollings. Yes, by all means. Tell us about China--
    no kidding.
        Secretary Powell. Let me talk about embassies, and then I
    will go to China.
        On the embassies, thank you. I will point out all three of
    these cases to General Williams and see what we can do.

             secretary's comments on china-united states relations

        I first went to China in 1973 as a young lieutenant colonel
    on a fellowship program right after Nixon made his first trip.
    It was a shocking visit, a remarkable visit. There were
    bicycles everywhere. The only things one could aspire to were a
    bicycle, a sewing machine, and a radio--that was it. If you had
    all three of those, you were at the top of society. You could
    go anywhere in China and ask a question and get the same answer
    from anybody. It was total group thought. They were just coming
    out of the cultural revolution. It was a depressing 3 weeks--
    but they were able to feed this country of, at that time, just
    short of one billion people.
        Now it is almost 30 years later, and there are skyscrapers
    popping up all over the place and a degree of wealth they never
    would have dreamed up. There is pollution, not from bicycles,
    but from cars running all over the place. And there is some
    level of openness that would have been undreamed of 30 years
    ago.
        Are they a society like ours? No. Are they totalitarian?
    Yes. Do they have an ideology that we find fatally flawed? Yes.
        But are they also understanding that in the international
    marketplace, there is wealth that they never dreamed of before?
    Yes. Forty percent of their products are coming to us, and this
    does not just benefit big American businessmen, it benefits
    your constituents who go to K-Mart and Home Depot and Office
    Depot and get products that they need perhaps a little more
    inexpensively.
        So they are coming out, and we need to keep encouraging it;
    but they are also running a country of 1.3 billion people, and
    they are determined--whether we think it is appropriate or
    not--they are determined that that philosophy, that ideology,
    and that country will not fall apart all at once the way the
    Soviet Union did, losing your political system, your economic
    system, your cultural identity all at once. They are determined
    that that is not going to happen.
        So I believe our strategy is rather clear--work with them,
    and our little ups and downs will come, but continue to work
    with them, continue to show them the benefit of moving in the
    direction that we think is the correct direction. When we do
    not like things about their society, about their government,
    about their way of doing business, about their lack of respect
    for international norms of human rights, then we should say so,
    just as we did to the old Soviet Union, and let the power of
    democracy, the power of openness, and the power of the free
    enterprise system work. It may take a generation or two. I do
    not know. It is up to the Chinese people to decide that. But
    let us not cut off our nose to spite our face in order to look
    like we are big and bad.
        I think President Bush understands this. I know he does. I
    think he demonstrated that in the way he handled the EP-3
    incident and the way he is handling the situation now--
    calibrated, firm, but with an understanding of the nature of
    the total relationship between us and China.
        Senator Hollings. I was there just at the time when Mao
    passed in 1976. So we were the capitalist running dogs, the
    gang of five, or whatever. But then I was there in 1986, 1996,
    right on down the line, and we are winning as far as your
    philosophy and my philosophy. I saw Madame Kang back there in
    1976, 25 years ago, and she said if the seed of capitalism ever
    got planted--that is why they had to go out to the countryside
    and be reeducated under Chairman Mao's doctrine--if the seed of
    capitalism ever got planted, it would be uncontrollable. And
    its spread is uncontrollable in my opinion. We have 50,000 of
    their students here in the United States, going back and forth.
        In my time, I think I am going to see a lot happen there.
    China is headed in the right direction when you understand that
    when you have 1.3 billion people, the first human right is to
    feed them; the second is to house them; the third human right
    is to educate; and the fourth is to give them voting rights--
    one man, one vote. But we have people running around in the
    Congress who want one man, one vote tomorrow and cannot
    understand why not.
        Secretary Powell. Well, it is a pretty good philosophy, but
    it is going to take time to get there.
        Senator Hollings. And finally on the trade matter, for
    example, I am a big cotton-producing State. You heard the
    Senator from Washington talk about her wheat. The truth of the
    matter is they already export more wheat than they import. They
    import more from us because they are smart; diplomatically is
    why they are doing it. We have a deficit in the balance of
    trade in cotton right now, and 700 million farmers are going to
    outdistance 3 million farmers. I do not care how much
    technology and equipment you have. So they are going to be an
    agricultural exporter, and then, all these people who get
    subsidized, the aircraft industry for research, the Export-
    Import Bank. Then chastise me when I want no subsidy, just the
    enforcement of my textile agreement. The subsidized crowd says
    ``You are protectionist,'' but they will learn before long, in
    the next few years.
        China has come along, and they are going to be quite a
    competitor, and we had better treat them as a competitor.
        Secretary Powell. May I say one more word, Senator--with
    your indulgence, Mr. Chairman.
        You talked about Japan, you talked about China, you talked
    about Vietnam, you talked about Korea--I also served in Korea
    after the war, so I have a little experience in the region. And
    the one thing that keeps things in balance and keeps China from
    becoming any more of a dangerous player, using its wealth for
    dangerous purposes--they will modernize their armed forces, and
    they will do a lot of other things that we may not like, but it
    is not clear to me that they are going to become the kind of
    aggressive nation that tries to expand beyond its borders--but
    the one thing that keeps it all in balance is the American
    presence. The one thing that keeps it all in balance--and
    nobody wants to see us leave for this reason--is that the
    investment of 100,000 American troops and American presence and
    American military commitment to the region underscores our
    diplomatic and political commitment to the region and keeps
    things in balance.
        So we should push for more burdensharing, and we should ask
    our friends in the region to do more, but we are the Asian
    power that keeps those very difficult competing interests in
    balance. At the end of the day, if you scratch any one of them,
    nobody really wants to see us leave.
        Senator Hollings. Thank you.
        Thank you, Mr. Chairman.
        Senator Gregg. Thank you.
        Senator Mikulski.

                                 iraq sanctions

        Senator Mikulski. Mr. Chairman, I just have one question,
    and I hope you do not regard your experience here as a quiz.
    Mr. Secretary, I want to come back to Iraq. You have proposed
    reshaping sanctions on Iraq and that we call them ``smart
    sanctions,'' with a focus on limiting Saddam's ability to
    develop weapons of mass destruction.
        Could you share with us perhaps an elaboration on the
    concept, and have you given up using broader sanctions on
    getting the inspectors in? I regard you as really quite an
    expert on Iraq for obvious reasons, and I think we would all
    like to be supportive here.
        Secretary Powell. Others use the term ``smart sanctions.''
    It is not a term that I have used. What I found when I became
    Secretary of State, and what the Bush Administration found when
    we came into office on January 20th, was that the whole
    sanctions regime was collapsing in front of our eyes. We had
    people running off hither and yon. We had people trying to
    undercut the compensation account. People were saying let us
    get rid of all the sanctions. We had difficulty with some of
    our best friends in the United Nations. The Arab nations were
    up-in-arms. And Saddam Hussein had very effectively put the
    blame on us for the suffering of his people, when the blame
    belonged right on him.
        So when we took a look at that and saw the whole thing
    collapsing, it was my judgment, shared by the President and
    approved by the President, that we ought to refocus the
    sanctions against their original target, which was weapons
    control, control of weapons of mass destruction and the
    technology to build them, and also control his ability to
    rebuild an armed force that would be threatening to the region.
        What I found was that the United States was placing holds
    on huge amounts of material and commodities that were heading
    into Iraq under the oil-for-food program at a rate 10 times
    higher than our allies were. So we were being very, very tough,
    and our allies were saying this is not going to work much
    longer--we have all got to have a common view of what we are
    doing.
        So what I have been working hard to do is to develop that
    common view, and I think we are having some success with it. In
    the PERM-5, I spoke to my Russian colleague, Foreign Minister
    Ivanov, about it again yesterday, and our teams are meeting. I
    think I will have good support from our Arab friends in the
    region. The Iraqis went to the Arab Summit and blew it and did
    not succeed in getting out of the constraints, did not get the
    Arab Summit to endorse their getting away from the control of
    these weapons as controlled by the United Nations.
        So I think we are going to have some progress, and I hope
    that by early June, when we have the next rollover of the
    sanctions regime in the United Nations, America's ideas will
    have taken root, and we will see a change in it.
        Senator Mikulski. Thank you very much, Mr. Secretary.
    Obviously, this is a work in progress. I think it does require
    new thinking while we are thinking about our national goals and
    our values.

                              global public health

        I know that we will be meeting again on May 15th in Foreign
    Operations, and at that time, I hope we can have a conversation
    on global public health issues--the growing rate of
    vulnerability, transnational threats to us in infectious
    disease, AIDS. And I am sure you are aware that yesterday, the
    House International Relations Committee voted 26-22 to reverse
    the gag rule. I would hope we could come up with a way of
    bridging that so that that is not the big fight--there are
    other real big fights--but many of us are quite concerned about
    the infectious disease issue, the AIDS problem in both Africa
    and Russia, that also, then, constitute threats to the United
    States and threats to them in terms of the ability to ever be
    able to grow an economy.
        Secretary Powell. There are 26 million people in Sub-
    Saharan Africa who have been condemned to death by HIV/AIDS,
    tuberculosis, and malaria, and the infectious diseases that are
    driven by HIV/AIDS, and----
        Senator Mikulski. Why don't we save that, then, until May
    15th when you come up to Foreign Operations.
        Secretary Powell. Very well, Senator.
        Senator Mikulski. And we look forward to your hearings next
    week, Mr. Chairman, on such a comprehensive approach to
    terrorism. It is probably the most----
        Senator Gregg. I hope you will have a chance to
    participate.
        Senator Mikulski. I am going to try to come to everything
    that I can.
        Senator Gregg. The idea is to have everybody who wants to
    participate be able to do so, and we hope the Secretary can
    make it, or Mr. Armitage.
        Senator Mikulski. Thank you very much.
        Mr. Secretary, again, we really look froward to working
    with you.
        Secretary Powell. Thank you, Senator.

                                trade with china

        Senator Hollings. Just a heads-up on one other function,
    that is, studying at the Department of Defense level, along
    with the Secretary of State, those items necessary to our
    national security. What I am getting at is back in 1961, 40
    years ago, President Kennedy could not evoke or take action for
    his seven-point textile program unless under the statute it was
    found to be necessary to our national security. He brought the
    witnesses, including Secretary McNamara, Orville Freeman, and
    Secretary of Treasury Doug Dillon, and we had the hearings, and
    next to steel, they found that textiles were second most
    important to our national security.
        You mentioned Ambassador Zoellick a minute ago. This trade
    measure has gotten totally out of hand, and the tail is wagging
    the dog. That crowd that did not want to go overseas to produce
    anything 50 years has now found out that for 10 percent of the
    cost, you can move your production overseas and bring it back
    in. And as a result, at least two-thirds and probably 75
    percent of the clothing I am looking at is imported, and 86
    percent of the shoes on the floor here are imported.
        I noticed in the newspaper that you were embarrassed, I
    take it, to finally stop the production of the Rangers in
    China. I was a witness back at that particular time. Tom Dewey
    represented the Japanese Government, and they ran me all around
    the hearing room of the old International Tariff Commission.
    The thrust was, ``Governor, what do you want them to make? We
    will make the airplanes and the computers, but let them make
    the clothing and the shoes.'' The problem is that today, they
    make the shoes, the clothing, the airplanes, the computers--the
    whole kit and caboodle. I do not mind losing the textiles,
    because they are all Republican anyway. But I really worry
    about the disillusionment of the economic backbone of this
    Nation. It is like a three-legged stool--first, your values,
    which are admired the world around; second, the military, which
    is unquestioned; but the third, the economic leg, we have
    sacrificed intentionally, really, for the victory of capitalism
    over communism. Fine--give them some textiles, give them this,
    give them that--but now we are competing with ourselves. The
    United States Chamber of Commerce does not represent Main
    Street; it represents overseas. I do not have to see the
    Japanese Ambassador come in; I see the United States Chamber of
    Commerce, with free trade, free trade, and so on.
        I have lost 42,500 textile jobs since NAFTA. We have lost
    500,000 textile jobs. We used to have 41 percent in
    manufacturing at the end of World War II, and now they are down
    to 12 percent of the work force.
        So the only way to get the attention of these free trade
    addicts, really gutting our economic strength, and fracturing
    that third leg, is to have a hearing to find out from the
    Secretary of State and the Secretary of Defense those things
    necessary to our national security. Find business for Jordan; I
    will vote for that. Find business with Chile--I know we will
    have a problem with respect to their salmon and with respect to
    their wine, but they have the entities in Chile of a free
    economy. They have property rights, a respected judiciary,
    labor rights. They had none of that in Mexico, and that is
    where we tripped up, and now we have to get some sort of
    Marshall Plan--that is another thing over there.
        But as we go along with the State Department just
    parroting, free trade, free trade, free trade, it is not
    necessarily working in our interest. That plane--I would not
    have given that much to China for that Boeing 777--50 percent
    of it is made in China--because the Chinese know how to trade.
    Do not talk about the Chinese--I hear these Senators jumping up
    and down, ``Oh, they cheat, they cheat.'' Well, by gosh, the
    Japanese continue to cheat; the Koreans continue to cheat. And
    they all cheat because that is the rule of thumb, because we
    never enforce our dumping laws, because we do not want to be
    protectionist.
        You have the army to protect us from enemies without; the
    FBI to protect us from enemies within. We have Social Security
    to protect old age, Medicare to protect health. You can go
    right on down--that is the function of Government. We have got
    to protect our economy.
        So as the Secretary of State, understand that we are doing
    pretty good militarily, we are doing pretty good on the values,
    but we are enfeebled in a sense--we are going to wind up like
    England. They told them at the end of World War II, do not
    worry--instead of a nation of brawn, you are going to be a
    nation of brains. Instead of producing products, you are going
    to produce services; instead of creating wealth, you are going
    to handle it and be a financial center. They have a bunch of
    Parliamentarians, and downtown London is an amusement park.
    They do not do anything. Do not worry when you get into a
    conference with that crowd--they do not have anybody to go.
    Their army is not as big as our Marine Corps.
        So we have got to maintain our economic strength, because
    money influences. The Japanese are now giving more to the
    United Nations than we are in foreign aid in different
    countries. We passed a resolution--they are talking about human
    rights in China--we passed it 12 years ago and have never had a
    hearing, because the Chinese went down into Africa and places
    like that where they had influence, and they forestalled it,
    and we have never had a hearing.
        So money talks, and watch it as the Secretary of State.
        Secretary Powell. Thank you, Senator.
        Senator Gregg. We very much appreciate your attendance, Mr.
    Secretary, and we thank you for your time.
        We are going to begin a series of hearings next week on
    terrorism and would appreciate the State Department's
    participation in those. They will begin on Tuesday, May 8th,
    and run for 3 straight days, with every department that has any
    involvement in combating terrorism being in attendance. At
    these hearings, we hope to hear from each agency about what
    their role is in combating terrorism activity, what they think
    their role should be in combating terrorism activity, and with
    whom do they coordinate and to whom do they report.

                         Additional committee questions

        It is essentially a set of hearings the purpose of which is
    to develop a base from which we can make some intelligent
    decisions on how to get better coordination with respect to
    terrorism activity. I know the White House is also aggressively
    pursuing this issue, but the Congress does have a role here, as
    Senator Hollings was just saying. That will be the focus of our
    attention next week.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]
                 Question Submitted by Senator Pete V. Domenici
        Question. Mr. Secretary, I listened with great interest to the
    President's recent speech on transforming deterrence at the National
    Defense University. As he has indicated in earlier foreign policy
    statements, he believes it's time to shift from a purely offensive
    posture to some mix of reduced offensive capabilities and more emphasis
    on layered missile defense possibilities. He also indicated that the
    first step would be consultation with allies. At some later point, the
    United States would engage Russia and China on this approach.
        1. I would like to understand your view of how we best can achieve
    consensus among our allies, as well as our potential adversaries, on a
    shift from mutually assured destruction to an entirely new approach
    that includes defensive capabilities?
        2. How do you believe we can assure stability as we proceed to undo
    the framework that has dictated the course of arms control over the
    past several decades, but as the President rightly indicated is no
    longer applicable to today's world?
        Answer. 1. We are consulting with our allies and working to
    convince Russia and China of the need to shift from a purely offensive
    posture to some mix of reduced offensive forces because our
    relationship with Russia is different--and limited missile defense
    capabilities--because we face missile threats from new challengers. On
    his two recent European trips the President described this vision and
    our plans to date.
        The NATO allies are unanimous in their support for President Bush's
    decision to intensify work with Russia on strategic stability, missile
    defense and a framework to replace the Anti-Ballistic Missile (ABM)
    Treaty before the U.S. testing schedule bumps up against Treaty limits.
    As the pace of United States-Russia discussions continues, we will keep
    the Congress as well as our NATO allies informed of our gameplan with
    Moscow and the results of our bilateral discussions.
        With respect to Russia we are seeking to build a new strategic
    framework in which our ability to destroy each other is not the
    defining principle. We seek to build a new relationship based on mutual
    interests and cooperation in the political, economic, and security
    areas.
        With respect to China, the United States intends to continue
    consulting with Beijing. China was in the process of modernizing its
    strategic forces before President Bush's missile defense initiative. It
    has continued to modernize its aging deterrent force. We have
    established a dialogue with the PRC on our strategic framework,
    emphasizing in particular that our plans with respect to missile
    defense are not aimed at China's small strategic nuclear force. We
    intend to continue our discussions with China on our strategic
    framework to promote our broad nonproliferation, arms control, and
    transparency/confidence building objectives.
        2. The July 22 Joint Statement by Presidents Bush and Putin marks
    an important step in our efforts to establish a new strategic framework
    for ensuring security and stability into the future. The statement sums
    up the Presidents' shared understanding that major strategic changes
    require concrete discussions of both offensive and defensive systems
    and that there are already some strong and tangible points of
    agreement. Intensive consultations have already begun on the
    interrelated issues of offensive and defensive systems.
        We have told the Russians that we believe it is necessary to move
    beyond the structures of the Cold War, including moving beyond the ABM
    Treaty. We also seek to develop regular United States-Russian exchanges
    to ensure full transparency and understanding of each other's offensive
    and defensive systems and future plans. This will provide assurance to
    each side that neither side threatens the other's strategic deterrent.
        The missile defenses we will deploy will be too limited to affect
    the credibility of the Russian deterrent, even at levels of forces far
    below those reportedly being considered in Moscow. The reductions in
    nuclear forces we both will make also will help preserve the stability
    of nuclear deterrence. The United States intends to reduce its nuclear
    forces to the lowest level consistent with our national security needs,
    including our obligations to our allies.
        We will continue consulting with China as we move forward. I was in
    Beijing last month, and emphasized that we want to build positive
    political, economic, and cultural relations with China. In particular,
    the Chinese agreed to further experts' talks on nonproliferation
    related issues. These consultations are integral to our ongoing effort
    to monitor closely PRC implementation of its nonproliferation
    commitments, including its November 2000 commitment to establish an
    effective missile technology export control system. We will take action
    if we see backsliding, including sanctions, where appropriate.
                                     ______

               Questions Submitted by Senator Ernest F. Hollings
        Question. Mr. Secretary, concern has been raised that the State
    Department has been outmaneuvered on the United Nations Compensation
    Commission (UNCC) by Russia, France and China. There is a perception
    that those countries have implemented a strategy to benefit Iraq
    instead of compensating Kuwait and the other victims of Iraq's
    aggression. Last year, for example, they got concessions for Iraq at
    the UNCC by blocking for several months a $16 billion oil field damage
    award to Kuwait, and now they are proposing the use of UNCC
    compensation funds to pay for Iraqi consultants to help Iraq oppose
    Kuwait's environmental claims. These actions indicate these countries
    may be motivated by the prospect of future commercial and oil field
    deals with Iraq as well as future military sales to Iraq. Does the
    Administration believe Security Council members are attempting to
    appease Iraq in order to further their parochial, commercial and
    economic interests? If so, what is the Administration's plan to ensure
    this pattern of behavior is corrected?
        Answer. Fourteen of the fifteen Security Council members support
    our new approach on Iraq. The UNCC's Governing Council, consisting of
    the same members as the Security Council, has consistently supported
    our efforts to keep the UNCC focused on the technical, non-political
    completion of the UNCC's workplan, under which it verifies and pays out
    claims, including the large environmental claims of Kuwait.
        In UNCC meetings, countries have raised questions about the
    fairness of the UNCC's processes, especially given the size of the
    awards now being considered. We have accepted some adjustments to UNCC
    procedures to allow the UNCC to continue processing claims as quickly
    as possible, according to its technical standards. The result of these
    changes is that the UNCC Governing Council continues to operate
    effectively and to approve awards by consensus. The continued
    effectiveness of the UNCC in carrying out its mandate to compensate
    victims of Iraqi aggression in Kuwait will continue to be the standard
    by which we judge any future proposals for change in UNCC procedures.
        Question. Concern has also been raised that if the UNCC does not
    fully compensate Kuwait and others similarly situated for the damage
    Iraq inflicted on them, Iraq and other would-be aggressors will believe
    that the United Nations and the international community lack the
    collective will to make them pay for the damage that they cause. They
    may believe they can avoid compensating the victims of their aggression
    by stalling for time and offering commercial inducements to targeted
    members of the Security Council. What steps will you take with the UNCC
    to ensure that Iraq fully compensates the victims of its 1990 invasion
    of Kuwait instead of marshaling its assets to fund Iraq's military
    programs?
        Answer. The Department has led the support for the UNCC's Work
    Program in order to ensure that every claim filed before the UNCC is
    adjudicated, and is working to ensure that the Compensation Fund is
    adequately funded until all awards rendered are paid.
        Question. The largest Kuwaiti war damage claims, totaling more than
    $140 billion for environmental damage and reconstruction costs, are
    still pending in the UNCC and are due to be decided later this year.
    The 42 Kuwait government claims processed so far have received an
    average amount of 55 percent of the amount claimed. Do you believe that
    the pending claims, which go to the heart of the damage caused by Iraqi
    aggression, will receive at least as favorable a rate of compensation
    as the claims processed earlier?
        Answer. We are not privy to any of the claims filed with the UNCC
    by any other government, including the government of Kuwait and are
    therefore not in a position to make our own assessment of the strengths
    or weaknesses of the claims made. Even if we did have access to these
    materials, it is impossible to guess, in advance, how the independent
    panels of commissioners will decide any given claim.
        Question. There is a perception that the UNCC Governing Council has
    made recommendations by panels of commissioners before the United
    States has had an official opportunity to review the claims. Will you
    make sure that the State Department and its legal Advisers engage the
    UNCC earlier in the process, review the Commissioners' analysis of the
    claims, and take steps to ensure that their recommendations do not
    unfairly favor Iraqi interests or discount claims unnecessarily?
        Answer. The UNCC's panels of commissioners independently review the
    claims before them, including any supporting evidence, and arrive at
    their own independent conclusions regarding the dispositions of claims.
    They submit their written reports and recommendations to the UNCC
    Secretariat, which makes them available to all members of the Governing
    Council simultaneously. Neither the U.S. Government, nor any other
    Governing Council member, is privy to those reports before that time.
    Before the UNCC's rules of procedure were revised in December 2000, the
    UNCC circulated reports to all Governing Council members 30 days before
    the quarterly sessions of the Governing Council at which the given
    report was to be discussed and approved. As a result of the revisions
    to the rules, certain reports, including those containing significant
    legal, factual and technical issues and those containing claims with
    recommended awards of $100 million or more, are to be made available
    three months in advance of the relevant Governing Council session.
    Although it is not privy to the evidence and expert reports that
    underlie panels' recommendations, the Department reviews all such
    reports for patent errors prior to Governing Council consideration.
    While under the rules the Governing Council does not function as an
    appellate body, in appropriate but infrequent occasions, the United
    States has sought clarifications from panels or in the Governing
    Council resolution approving an award. To date, all awards have been
    approved by consensus among Governing Council members.
        Question. Concern has been raised that of the $34 billion awarded
    by the UNCC to date only $11 billion has been paid. In addition, the
    United Nations reduced the amount Iraq had to contribute to the U.N.
    Compensation Fund from the oil-for-food proceeds from 30 percent to 25
    percent. What steps does the United States plan to take to ensure that
    this rate is not further reduced and that the remaining awards,
    including those resulting from the $140 billion in remaining Kuwaiti
    claims, will actually be paid?
        Answer. As part of an agreement that led to UNCC Governing Council
    approval of a $16 billion award to Kuwait, the United States accepted a
    temporary reduction in the allocation from Iraqi oil revenues to the
    U.N. Compensation Fund. These funds that made up the reduction are
    earmarked exclusively for humanitarian projects under the control of
    the United Nations to benefit the people of Iraq, not to the Iraqi
    regime. During negotiations on the Security Council resolution that
    would have established a new approach to Iraq, we have supported a
    return to a 30 percent allocation. Within the UNCC we will continue to
    ensure that the UNCC has the resources to pay awards and that its award
    adjudication and payments reflect the technical merits of the awards
    and UNCC procedures claims and not extraneous political factors.
                                     ______

               Questions Submitted by Senator Barbara A. Mikulski
        Question. President Bush promised during his campaign to
    immediately begin the process of moving the U.S. Embassy in Israel to
    Jerusalem. What funds in the Embassy Security and Construction request
    will be used for that purpose?
        Answer. The President remains committed to beginning the process of
    moving our Embassy to Jerusalem. However, we are not in a position to
    establish an embassy in Jerusalem at this time. A fundamental and
    overarching foreign policy and national security goal of the United
    States is to help the parties end the current violence in Israel, the
    West Bank and Gaza.
        The President has determined that moving the embassy now would
    complicate our ability to play a helpful role in bringing and end to
    this violence. That is why on June 11 the President exercised the
    waiver authority given him by the Jerusalem Embassy Act to waive for
    six months the Act's limitations on the Department's ability to
    obligate the funds appropriated for overseas buildings.
        Question. U.S. citizen Zachary Baumel and two other Israeli
    soldiers have been missing since June 1982, when they were captured
    after a tank battle with Syrian forces. Three other Israeli soldiers
    were kidnapped in northern Israel and taken to Lebanon last October.
    What are we doing to help find these Israeli soldiers captured and
    taken into Lebanon or Syria? Why hasn't the Red Cross and Red Crescent
    even managed to locate them?
        Answer. The Department considers ascertaining the fate of all
    Israelis missing in Lebanon as an important humanitarian goal. U.S.
    citizen Zachary Baumel, and fellow Israeli soldiers Yehuda Katz, and
    Zvi Feldman have been missing since 1982, while Israeli pilot Ron Arad
    has been missing since 1986. In October, 2000, Hizballah captured three
    Israeli soldiers, Avi Avitan, Benny Avraham, and Omar Souad while they
    were patrolling the Israeli side of the United Nations certified Blue
    Line. Shortly thereafter, Hizballah seized Israeli businessman Elchanan
    Tanenbaum, though the circumstances remain unclear.
        The Department is in close touch with Israel and the families, with
    whom the Secretary met in June. We have endeavored to be as helpful as
    possible in pushing for International Committee of the Red Cross access
    and in ascertaining the fate of all missing Israelis. At every
    opportunity we call on Syria and Lebanon to do their utmost to help
    achieve the release of, and/or information about the missing Israelis.
    Assistant Secretary Burns stressed our concerns directly in Beirut and
    Damascus in July, and met again with the families in Washington on
    August 2.
        The United States maintains a strict prohibition against contact
    with Hizballah. Negotiations on the prisoners have accordingly been
    pursued through non-U.S. channels. The Department of State will
    continue to monitor and raise this issue whenever and wherever doing so
    will contribute to the resolution of this humanitarian issue.
        Question. Last year, the State Department requested $30 million in
    the Foreign Operations bill to establish a Center for Anti-Terrorism
    and Security Training (CAST). The purpose of CAST is to provide one
    good site to be shared by Diplomatic Security service for its own
    training and for the International Narcotics and Law Enforcement (INL)
    bureau to provide training for selected foreign officials. That request
    was not met, because it was felt that building such a facility should
    be funded in Commerce-Justice-State, not Foreign Ops. I hope you will
    look into getting this important facility established.
        I believe Aberdeen Proving Ground in Maryland could be an
    outstanding site for the CAST. It has the space you need as well as
    other related institutions. It is within easy distance of Washington
    and close to BWI airport.
        Why didn't the Administration request CJS funds for CAST this year?
    Would you please ensure that your DS and INL officials fully consider
    the advantages of locating the facility at Aberdeen Proving Ground?
        Answer. The Antiterrorism Assistance Program's CAST initiative is
    intended to significantly increase training for foreign law enforcement
    and Government officials. The Department is continuing to explore
    sites, which would serve the CAST training requirements, as well as
    those of the Diplomatic Security Service. Proximity to Washington, DC,
    existing infrastructure, and potential for dual use are among the
    criteria being reviewed. The Aberdeen Proving Ground is among a number
    of venues, which continue to be vetted.
        However, while the Department firmly believes in the value of CAST,
    the prioritizing of needs for the fiscal year 2002 budget cycle could
    not accommodate funding for CAST. While we cannot now commit to fiscal
    year 2003 spending initiatives, the CAST program will be given every
    consideration.
                                     ______

                Questions Submitted by Senator Patrick J. Leahy
        Question. In my opening statement, I mentioned the Bureau for
    Democracy, Human Rights and Labor. The Administration has already made
    its budget request, which I believe falls short, and I will be talking
    to the Chairman and Ranking Member about that.
        But there is also a lot that can be done, without spending money,
    to strengthen that office. It all depends on what message you, as the
    Secretary, send to the rest of the Department. If you make clear that
    you want their unvarnished views whenever there are potential human
    rights issues at stake, that would make a difference. Would you comment
    on this?
        Answer. Since taking office, I have made it clear to all my Under
    Secretaries and Assistant Secretaries that I want to be presented with
    all views on an issue even where a position may affect our relationship
    with a foreign country. This understanding applies directly to human
    rights issues. For example, Assistant Secretary of State for Democracy,
    Human Rights and Labor Lorne Craner, who is a key member of my team and
    participates in my daily senior staff meetings, accompanied me on my
    recent trip to Asia. I value his unvarnished views.
        Question. An election will be held in East Timor later this year to
    establish an independent government. I know there is a waiting list for
    construction of new embassies, and for the renovation of existing
    embassies and other facilities. However, we do need an embassy in East
    Timor, and I would like to know the status of the Department's efforts
    to open a fully functioning diplomatic mission there.
        Answer. The Department shares your desire for an expeditious
    opening of diplomatic mission in Dili. A U.S. presence in East Timor is
    essential to monitor our bilateral assistance programs and work with
    officials of U.N. transitional administration in East Timor as well as
    the nascent East Timorese government.
        On May 7, 2001, the Department transmitted a notification letter to
    the Congress requesting reprogramming of funds for facilities
    renovation and operating expenses associated with opening a U.S.
    diplomatic post in Dili, East Timor. However, language included in the
    Report (107-42) accompanying the fiscal year 2002 Senate Commerce-
    Justice-State Appropriations Bill (S. 1215) puts a hold on this
    reprogramming action. In the Report, the Committee expresses its
    concern with the safety of American people and property in East Timor
    and directs the Department to report on the situation by January 1
    2002, at which time the Committee will reconsider our request to open a
    post in Dili. While we will provide the Committee with the requested
    report, we still believe that opening a U.S. diplomatic mission in Dili
    as soon as possible is in our national interest, and we would hope the
    committee could find a way to allow the administrative preparation for
    opening a post to proceed in the interim.
                          office of war crimes issues
        Question. I am pleased that you decided to keep the position of
    Ambassador-at-Large for War Crimes. There have been reports that there
    is consideration within the State Department to place the Office of War
    Crimes (S/WCI) under the authority of either the Under Secretary of
    State for Arms Control and International Security (T) or the Office of
    the Legal Advisor (L). Do you intend to maintain the current structure
    where S/WCI reports directly to the Secretary of State?
        Answer. I have decided that the Office of War Crimes Issues (S/WCI)
    will continue to report directly to me. Pierre-Richard Prosper, our new
    Ambassador-at-Large for War Crimes Issues, advises me directly on U.S.
    efforts to address serious violations of international humanitarian
    law, including genocide, crimes against humanity and war crimes,
    committed throughout the world. President Bush and I count on him to
    ensure that the United States remains a leader in the effort to punish
    war criminals and to prevent the commission of future crimes.
        Question. Don't you think the best strategy is to remain a
    signatory [to the ICC treaty]--to maintain our leverage in the
    negotiations and allow our representatives to get more protections for
    Americans?
        Answer. The Administration's primary objective in its ICC review is
    to find avenues to protect United States officials and service
    personnel from politically motivated prosecutions by the International
    Criminal Court. That review is currently underway.
        Question. Does the Administration's policy on the ICC include
    ``unsigning'' the treaty or actively pressuring our friend and allies
    not to ratify it?
        Answer. As you know the Administrative has no intention to submit
    the ICC treaty to Senate for advice and consent to ratification. The
    Administration has currently underway a review of the ICC and is
    seeking to develop a strategy that best protects the interests of the
    United States.

                              subcommittee recess

        Senator Gregg. I thank you for your attendance, and this
    hearing is recessed.
        Secretary Powell. Thank you, Senator.
        [Whereupon, at 11:18 a.m., Thursday, May 3, the
    subcommittee was recessed, to reconvene subject to the call of
    the Chair.]

    DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE JUDICIARY, AND RELATED
                  AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2002

                                  ----------

                             TUESDAY, MAY 15, 2001

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 10 a.m., in room SD-192, Dirksen
    Senate Office Building, Hon. Judd Gregg (chairman) presiding.
        Present: Senators Gregg, Stevens, Hollings, Inouye, and
    Murray.

                             DEPARTMENT OF COMMERCE

                National Oceanic and Atmospheric Administration

    STATEMENT OF SCOTT B. GUDES, ACTING UNDER SECRETARY AND
                ADMINISTRATOR
    ACCOMPANIED BY:
            JACK KELLY, ASSISTANT ADMINISTRATOR, NATIONAL WEATHER SERVICE
            BILL HOGARTH, ASSISTANT ADMINISTRATOR, NATIONAL MARINE
                FISHERIES SERVICE

        Senator Gregg. The subcommittee will come to order.
        It is a pleasure today to have the Acting Administrator of
    NOAA, Scott Gudes, with us. He is reasonably familiar to the
    committee.
        I have no opening statement. Senator Hollings.
        Senator Hollings. Thank you, Mr. Chairman.
        I note the bio or resume here of Scott B. Gudes, and I see
    mentioned Fullerton and scuba diving and many other things, but
    it does not mention my name.
        I think of the time that Bess Truman--they used to tell all
    kinds of stories about President Harry Truman--had gone to have
    her annual physical, and she was standing in front of the
    mirror, admiring herself. The President looked at her and
    asked, ``What in the world are you doing?''
        She said, ``I have just had my annual physical, and the
    doctor said I am in the best shape of anyone he has ever seen
    my age.''
        And Harry asked, ``Well, what did he say about your big,
    fat . . .''
        And she said, ``Harry, he did not even mention your name.''
        Thank you, Mr. Chairman.
        Senator Gregg. That may go down as one of the more original
    opening statements.
        Mr. Gudes. You cannot say those things in the executive
    branch, so I will just listen.
        Senator Gregg. Senator Inouye, did you have any opening
    remarks?
        Senator Inouye. I do not think I can add to that.
        Senator Gregg. No, I do not think any of us can.
        Senator Inouye. I just want to welcome Scott.
        Senator Gregg. Mr. Gudes, the floor is yours.
        Mr. Gudes. Thank you, Chairman Gregg, Senator Hollings,
    Senator Inouye.

                   opening statement by under secretary gudes

        I will submit my full statement for the record, and I would
    like to use these powerpoint slides and just make some oral
    comments if I could.
        First of all, let me say on behalf of Secretary Evans and
    our 12,500 men and women working around the country that I want
    to thank you for this opportunity to come here today and
    testify on behalf of our fiscal year 2002 budget for your
    National Oceanic and Atmospheric Administration.
        I also want to thank this subcommittee for your unwavering
    and strong support through the years for our Nation's ocean and
    atmospheric programs and especially highlight your outstanding
    professional staff who have worked so closely with NOAA--Jim
    Morhard and Luke Nachbar, Lila Helms, Jill Shapiro-Long, Nancy
    Ragland-Perkins, and Dana Quam.
        Mr. Chairman, I would also like to recognize my management
    team that is here today--my deputy chief financial officer and
    budget director, Jolene Lauria Sullens; Sonya Stewart, our
    chief financial officer and chief administrative officer;
    Margaret Davidson, head of the Oceans Service; Bill Hogarth,
    head of Fisheries; Jack Kelly, head of the Weather Service;
    Louisa Koch, deputy head of research; Greg Withee, who is here
    for satellites; Bob Taylor from Office of Marine Aviation
    Operations.
        These are, I think, testament to the fact that NOAA is much
    greater than the sum of its parts, and I rely on this whole
    management team to help run the agency.
        For fiscal year 2002, the NOAA budget totals $3.152
    billion. That is a $61 million reduction from the current year.
    So we are not talking about how much real growth above the
    current year or below the current year.
        That really does not tell the whole story. We have about
    $330 million in reductions and about $270 million of
    investments or add-backs. That is most of what I will talk
    about today. But when you look at those add-backs, Mr.
    Chairman, I think you will see that in fact they really do
    emphasize NOAA's core mission; that Secretary Evans really did
    come to us and say ``Please invest in the things that will help
    NOAA do its mission in the future.'' And I think you will see
    that that $270 million is wisely invested.
        I also believe that this subcommittee will find this budget
    to be more realistic than past budgets that have been submitted
    in that we have fully funded programs that this subcommittee
    has been telling us for years are important and high priority
    that have too often come up being cut or terminated in the
    President's budget.
        So that, for example, the Coastal Services Center is fully
    funded; the Joint Hydrography Center; CICEET, the National
    Undersea Research Program. We are almost at last year's level
    for the Steller sea lion programs. The Juneau lab in Alaska for
    the first time has a substantial funding request, and Sea Grant
    is fully funded. Coastal Zone Management actually has an
    increase. Those are programs that this committee for years has
    supported and told NOAA that it wants to be funded.

                          noaa management improvements

        If I could turn to the first slide that shows management
    improvements, before talking about what we are asking for in
    terms of funding this year, I would like to show you what we
    have been doing with the funding that this subcommittee and
    committee have been providing to us in the past and just show
    you some of the impacts we have had.
        If you look at the box in the middle, that is hurricane
    track forecasts. What the slide shows is that since the mid-
    1980's, we have reduced the error in hurricane track forecasts
    from about 400 nautical miles out at 72 hours down to 200
    nautical miles. We are coming down every year a few percentage
    points. We can do better, but we have cut it in half since the
    mid-1980's, and that is a factor of better satellites, better
    training, better research, but most importantly, better
    supercomputers and models. That really shows the impact of
    that.
        Another example is tornado lead time, where in the early
    1990's, we had very little lead time; we got a nationwide
    system of NEXRAD Doppler radars, of AWIPS communications and
    forecasting systems, and now we are up to 10\1/2\ minutes of
    lead time, and that is for all types of tornadoes. If we are
    looking at the larger tornadoes on the Fujita Scale, we have
    greater lead times.
        On acquisition reform, this committee played a real
    leadership role. In the 1991 time frame, we had one
    geostationary satellite left in this country. I remember when
    this subcommittee got together with the Commerce Committee and
    held a special hearing to get on top of the situation and do
    something about the fact that we had one geostationary
    satellite, and we did not think it was going to last until the
    next series came and replaced it. And by the leadership of this
    committee, Loral Corporation, our satellite service, and Ray
    Kamer, who just retired from NIST and was the Deputy Under
    Secretary of NOAA at the time, we made real improvements and
    fixed those instruments.
        The situation we now have is that we basically kept the
    costs of a geostationary satellite in constant dollars frozen
    or slightly less than it was. We have two--one West, one East--
    geostationary satellites, one in cold storage in orbit, ready
    to turn on; and a fourth satellite that is going to be launched
    this summer. So we have gone from a situation through better
    acquisition management of keeping down costs but also providing
    robustness to our system and being able to maintain coverage
    for the American people.
        Turning to the budget for this fiscal year, the next slide
    shows some of the cross-cutting themes that we have used and it
    highlights some of the numbers that I showed you before.

                             noaa budget priorities

        The next slide shows my number one priority. If you ask me,
    ``Scott, you are Acting Administrator. What is your top
    priority in the budget?''--it is our people. It is funding our
    adjustments to base--the pay raises, the rent costs, the must-
    pay bills. That is about $60 million of our request, and about
    $24 million of that is for the Weather Service, which is the
    most people-intensive part of NOAA. For too long, too many
    years, the President's budgets did not come up fully funding
    it, and we have done that.
        The next slide shows my next-highest priority, which is
    infrastructure--equipment, facilities, maintenance. It is what
    I call infrastructure, and it is about areas where we have not
    traditionally done well in NOAA, worrying about how this agency
    is going to continue to do its mission, not just today but in
    the future.
        I would just like to highlight a few of the things that are
    covered in here. Three million is to help start building our
    new Honolulu Fisheries Laboratory. It is collocated at the
    University of Hawaii. It is non-ADA-compliant right now--that
    is the Americans for Disabilities Act. It has leaks in the
    computer areas, and I think it was originally designed for 45
    employees, and we currently have about 120 there.
        Then, $1.7 million is for overall safety and environmental
    issues; $5.8 million is for overhaul and repair of two of our
    NOAA fisheries vessels, including the Albatross IV, which is
    home-ported in Woods Hole and is the workhorse of our Northeast
    surveys.
        And $7.5 million is for a backup telecommunications gateway
    for our National Weather Service. The gateway puts out all
    products to emergency managers, the media, and to the public.
    We have a single point of failure in Silver Spring. We talk
    about critical infrastructure a lot on this committee and in
    the executive branch. This is about giving us a backup
    telecommunications gateway so that we do not have that single
    point of failure. It is the right thing to do.

                              cross-cutting issues

        The next slide, I will just go through very quickly, but
    there are a few cross-cutting issues. I want to talk about
    satellites and our weather forecasting.
        Under coastal conservation--that is a program sometimes
    called Lands Legacy, coastal ocean activities--we have a number
    of programs there from coral reefs to marine sanctuaries to the
    estuarine research reserve program, like Ace Basin and Great
    Bay. The total increase for that is $34.4 million, and included
    in the marine sanctuary request is $6.5 million to build and
    fully fund the Nancy Foster complex in Key West for the Florida
    Keys Sanctuary.
        On the right, modernizing NOAA fisheries--we are really
    following the lead of this committee, and we have an increase
    of $60.1 million for science, for management, and for
    enforcement; $13.3 million for surveys, which is largely by
    contract, days at sea--829 days, I believe, by contract. We
    have $2.5 million for Fisheries Management Councils. They are
    really the way that we manage fisheries in this country in
    partnership with the industry and the States, and they have
    adjustments to base as well, and they have not gotten an
    increase in quite some time.
        We have $2 million for the community-based Habitat
    Restoration Program, which has been making a big impact across
    the country. We have some $16.5 million in increases requested
    for the Climate Services Initiative, like Argo floats, which
    are like radiosondes, weather balloons, if you will, for the
    ocean, for studies of carbon in Arctic ice. It includes $3
    million for supercomputing to get our capability at the
    Geophysical Fluid Dynamics Lab, our principal climate modeling
    center in this country, up to speed with the Japanese and the
    Europeans, which have more capable supercomputers right now.
        Climates, both seasonal and long-term--this is a major
    interest of NOAA and of this country. Increasingly, we are
    realizing that it is of interest to the energy industry as
    well, something that we have increasingly become aware of and
    they have increasingly become aware of. And of course, it is
    also about the oceans. Of course, climate is one of the areas
    in NOAA that is not about atmospheric NOAA or oceanic NOAA; it
    really is both, because in order to understand climate, you
    need to understand the oceans and their impact.

                         maritime transportation system

        One slide that you have up there, a final area before I
    turn to satellites, is the maritime transportation system. I
    know this is a major area of interest to a number of people on
    the committee. What we are talking about there is really
    looking at our maritime transportation system in the same way
    we do at aviation, at surface transportation. We have a number
    of specific initiatives--$3 million for working with
    communities in coastal storms, $2 million for oil and hazardous
    spill response, and $3.6 million for electronic navigational
    charts to really move the smart charts, vector charts, and a
    digital database to cover 200 of the most important ports of
    this country.
        I would just like to highlight--there is an image of a NOAA
    polar satellite here on the bottom--I would like to cover two
    programs that are under satellites and weather, because I think
    they are highly important, and one of them is the biggest
    budget initiative that we have in here.

                             hurricane forecasting

        The first is a $2.2 million increase for something called
    the U.S. Weather Research Program. I guess I would probably
    refer to that as hurricane forecasting, if you will. It is
    about hurricane track forecasts, about intensity, about
    quantitative precipitation forecasts. Increasingly, the number
    one killer from hurricanes is not the storm surge and the winds
    at the coast--we are doing a better job getting the public to
    pay attention to that--but it is about inland flooding. In
    Hurricane Floyd, we lost over 50 people to inland flooding. So
    the U.S. Weather Research Program is really about doing the
    science, working with our partners in the academic community
    and other agencies, doing a better job in all of those areas,
    being able to determine where a hurricane is going to hit, with
    what intensity and how much rainfall.
        If you turn to the next slide, I just want to show you an
    example of why I think we need to move on this area, and I am
    pretty proud that it is in our budget. On this side is a
    depiction of Hurricane Georges. Hurricane Georges came over Key
    West and did not intensify quite as much as we had thought,
    which was good. But 48 hours later, it came in to southern
    Mississippi just about exactly where we predicted it would; it
    did a few things in between that scared the people in New
    Orleans, but it came in pretty much where we said 48 hours
    later. So it is an example in 1998 of where we got it right.
        On the other side of the page is Hurricane Mitch. Hurricane
    Mitch came across the Caribbean, and it actually came back into
    tropical storm status and then went down over Honduras and
    became sort of like Hurricane Agnes here on the East Coast,
    with major flooding, and killed over 10,000 people.
        No model--NOAA's GDFL hurricane model, the Navy's model, or
    the European model--predicted that hurricane to come south like
    it did or to stall. So 98 years or so after the Galveston
    hurricane, we lost 10,000 people just 3 years ago. So it is an
    example of how far we have got to go in terms of hurricane
    forecasting in this country.

                               npoess satellites

        The last major program that I would like to mention is
    NPOESS, the National Polar-Orbiting Environmental Satellite
    System. The satellites that you see on television are
    geostationary satellites; you see them every night. You do not
    see our polar satellites. Our polar satellites do several
    functions. They get the meteorological measurements, which are
    the backbone of how we do our numerical weather prediction,
    those models we talk about for winter storms and for all the
    long-term forecasting that we do. They do search and rescue,
    SARSAT with the Coast Guard. We have saved over 12,000 lives
    since 1982. They do ozone, and they also do imaging. And
    actually, with our very high advanced resolution radiometer, I
    have some pictures of how that satellite actually does disaster
    assistance all over the world. It is a global satellite.
        This shows some examples of where we got Mozambique some
    forecasts of flooding, and Ethiopia and the Horn of Africa,
    with drought and fires. These really are global satellites;
    they cover the globe every day.
        In the polar satellite area, we have two programs. We have
    the NOAA civil satellite, and we have the Air Force satellite,
    called DMSP. For 40 years, these two agencies have run separate
    satellite systems--NOAA runs two, and the Air Force runs two.
    In about 1993-1994, the previous administration said we are not
    going to do that anymore; we are going to have one system, and
    we are going to call that NPOESS, National Polar-Orbiting
    Environmental Satellite System, and merge them together and
    only have three satellites at any time.
        It is an issue of improving those forecasts, improving the
    data. It is also an issue of continuity. And that is the one
    thing I want to leave you with today. It is the largest budget
    increase in our budget, $83 million. It is a 50-50 program,
    half in NOAA, half in the Department of Defense, Air Force.
        We only have three current-generation polar satellites left
    on the ground to get us to the first NPOESS satellite, and that
    is in 2008-2009 for delivery if everything works on time.
        So my point is that I would like us not to take a chance of
    getting back into a gap like we were in the geostationary
    program. I think it is very important to keep NPOESS on
    schedule. It is very important for the civil community, which
    is represented by NOAA, to be an equal partner in that program
    along with the Department of Defense.

                               ocean exploration

        Finally, you talked about the ``O'' in NOAA. At the
    Secretary's hearing, you heard that ocean exploration is about
    the ``O'' in NOAA. It is responding, I think, to the points
    that have been made here. It is one of the areas that the
    Stratton Commission asked NOAA to be involved in that we really
    never stepped up to the plate on. And really following your
    lead, you gave us $4 million, and we are moving expeditiously
    to do missions in the East, called Big East, diving in the
    Hudson Canyon off the East with the Alvin submersible, along
    with our partners in universities, NSF, and Woods Hole; out on
    the West Coast, working in Astoria Canyon in the Gulf. We are
    moving ahead on that program, and we have requested an increase
    of $10 million. It follows the recommendations of the
    President's blue ribbon panel on ocean exploration headed by
    Dr. Marcia McNutt, which also included Dr. Bob Ballard, the
    fellow who found the Titanic, and Dr. Shirley Pomponi from
    Harbor Branch, and a number of other oceanographers. So I think
    it is doing the right thing for what you want.
        The final slide shows that ocean exploration is also about
    education and outreach. That is a major part of what we are
    doing. Ten percent of the program--any number that you give us,
    10 percent will be for education and outreach.
        The final slide is of our website, www.noaa.gov. I for one
    think that NOAA's core mission includes training the
    meteorologists, the oceanographers, the marine biologists, the
    explorers, if you will, of tomorrow. And as I go around the
    country, one thing that is very rewarding to me is to have
    students and teachers and the public come out and talk about
    how great our website is and how they can really navigate from
    anything from our hurricane imagery, satellite imagery, to our
    weather forecasts, to learning about whales and marine mammals.
        It really is about reaching your constituents and my
    customers, really, and it is about education and outreach, and
    we are usually in the top 10 websites in Government and private
    sector on any given week--when we have severe weather, it is
    even higher. But it has really been an example of where our
    people got together and did the right thing in engineering and
    taking a look at how to outreach the agency.
        The last point I would like to make is that this committee
    played a leadership role in keeping our NOAA Corps 7th
    Uniformed Service a uniformed service in this country. Last
    Wednesday night, I had the opportunity to go to Kings Point, to
    the U.S. Maritime Academy, to the graduation ceremony for the
    100th basic officer training class. This is a picture of that
    class, and those ensigns are now being deployed to ships across
    the country. One is going to work in South Carolina; two are
    going to work in Seattle; and one of these ensigns, Ensign
    Sook, is from the University of New Hampshire and grew up in
    New Hampshire. So I thank you for what you did to keep our NOAA
    Corps.
        Thank you very much, Mr. Chairman.
        [The statement follows:]
                       Prepared Statement Scott B. Gudes
        Thank you, Mr. Chairman, and members of the Subcommittee, for this
    opportunity to testify on the President's fiscal year 2002 Budget
    Request for the National Oceanic and Atmospheric Administration (NOAA).
        I am accompanied today by Sonya Stewart, Chief Financial Officer/
    Chief Accounting Officer.
        Let me begin by saying that NOAA, a key component of the Department
    of Commerce, plays a vital role in the everyday lives of our citizens
    through our numerous contributions to the Nation's economic and
    environmental health. In a period of strongly competing Government
    priorities, the President's fiscal year 2002 Budget Request for NOAA is
    $3,152.3 million in total budget authority for NOAA and represents a
    decrease of $60.8 million below the fiscal year 2001 enacted levels.
    Within this funding level, NOAA proposes essential realignments that
    allow for a total of $270.0 million in program increases in critical
    areas such as infrastructure, severe weather prediction, coastal
    conservation, living marine resources, and climate.
        The funding requested in the fiscal year 2002 President's Budget
    Request will allow NOAA to ensure that our vision for environmental
    stewardship and assessment and prediction of the Nation's resources
    becomes a reality and that NOAA will continue to excel in our science
    and service for the American people.
        From weather forecasting to fisheries management, from safe
    navigation to coastal services, remote sensing to climate research and
    ocean exploration, NOAA is at the forefront of many of this Nation's
    most critical issues. NOAA's people, products and services provide
    vital support to the domestic security and global competitiveness of
    the United States, and positively impact the lives of our citizens,
    directly and indirectly, every single day.
        NOAA's mission is to describe and predict changes in the Earth's
    environment and to conserve and manage the Nation's coastal and marine
    resources to ensure sustainable economic opportunities. NOAA implements
    its mission through its line and staff offices: the National Ocean
    Service (NOS); the National Marine Fisheries Service (NMFS); the Office
    of Oceanic and Atmospheric Research (OAR); the National Weather Service
    (NWS); the National Environmental, Satellite, Data and Information
    Service (NESDIS); the Office of Marine and Aviation Operations (OMAO);
    and Corporate Services (CS).
        Today, the Nation and the world look to NOAA to provide timely and
    precise weather forecasts that protect lives and property; to manage
    fisheries and protected species; to promote and sustain healthy
    coastlines; to make America more competitive through safe navigation;
    to examine changes in the oceans; and to inspire and create approaches
    that will protect and keep our precious natural resources alive for the
    generations to come.
        NOAA conducts research to develop new technologies, improve
    operations, and supply the scientific basis for managing natural
    resources and solving environmental problems. NOAA's comprehensive
    system for acquiring observations from satellites and radars to ships
    and submersibles provides critical data and quality information needed
    for the safe conduct of daily life and the basic functioning of a
    modern society.
        NOAA's products and services include short-term weather and space-
    weather forecasts, seasonal climate predictions, long-term global
    change prognoses, environmental technologies, nautical charts, marine
    fisheries statistics and regulations, assessments of environmental
    changes, hazardous materials response information, and stewardship of
    the Nation's ocean, coastal, and living marine resources.
        NOAA's programs for fiscal year 2002 support several key cross-
    cutting initiatives. These cross-cutting initiatives illustrate the
    degree to which NOAA's programs are inter-related. Each of the
    component programs within a cross-cutting initiative uniquely
    contributes to NOAA's ability to meet its mission.
        The fiscal year 2002 President's Budget Request supports NOAA's
    cross-cutting initiatives, each of which is I will discuss in greater
    detail.
    People and Infrastructure
        The request of $73.3 for the People and Infrastructure cross-
    cutting initiative brings together the heart of what NOAA is and does.
    These are the underlying and interconnecting threads that hold NOAA and
    its programs together. Investments in NOAA's scientific and technical
    workforce and NOAA's facilities and equipment is essential to the
    agency carrying on its mission into the 21st Century. ``People and
    Infrastructure'' is about investing in the future.
                People ($60.0 million)
        NOAA requests $60.0 million in base adjustments that are critical
    to preserve and develop NOAA's human capital, our greatest asset. The
    demand for NOAA's scientific work products and services is expected to
    increase significantly in fiscal year 2002 and beyond. This trend is
    evidenced by market responses to increasingly accurate seasonal
    forecasts, protection of life and safety, competing interests for
    marine resources and the need to protect and recover endangered
    species, and the application in pharmaceutical manufacturing of the
    earliest rewards from increased ocean exploration. Similar increases in
    demand for NOAA's products and services are expected from the national
    energy community and other potential user communities. To ensure NOAA's
    mission capacity is adequate to respond to these demands, NOAA must
    continue to invest in its people.
        This investment will ensure NOAA's programs are maintained at the
    current services level. These are ``must-pay'' bills like pay raises,
    benefits, inflation, and rent. Failure to receive these adjustments in
    any given year results in program dislocations and minor cutbacks.
    Failure to receive these adjustments over time has a cumulative erosion
    effect that can be programmatically devastating. Consequently, these
    adjustments to NOAA's funding base are essential for NOAA to continue
    meeting core mission-related requirements and the expectations of the
    American public.
                Infrastructure ($73.3 million)
        NOAA's facilities and information technology infrastructure
    directly and immediately impacts the ability of NOAA's program offices
    to satisfy mission demands. The condition, readiness and
    vulnerabilities of this infrastructure have direct consequences on
    human welfare, economic well being, and the advancement of the state of
    the sciences. To ensure mission capacity, NOAA requests infrastructure
    funding of $73.3 million in the following key categories: critical
    systems, construction, maintenance and repair, and NOAA program
    support.
                Systems ($16.4 million)
        The total request of $4.0 million for the National Marine Fisheries
    Service (NMFS) Computer Hardware and Software represents an increase of
    $0.5 million. This continued investment will be used for information
    technology refreshment to support the scientific and computational
    needs of the NMFS. Many of the observational data elements obtained
    from the new sensors, observers, Fisheries Research Vessels (FRVs) and
    survey and census data collection programs in this budget submission
    will rely on the NMFS Information Technology infrastructure for all or
    part of their life cycle. The cumulative effect of rising costs, the
    unmet need for adjustments to base, and expanding requirements have
    created an erosion of base program functionality. These funds will
    result in a continuous process of technology refreshment to keep pace
    with the increasing information flow created by the deployment of new
    sensors, platforms and data collection activities throughout NMFS'
    initiatives.
        NOAA requests a total of $7.5 million for the National Weather
    Service (NWS) Telecommunications Gateway (NWSTG) Backup, to provide
    critical infrastructure protection. This investment will enable NOAA to
    acquire the equipment and facility infrastructure necessary to ensure
    continuity of operations at the NWSTG. The NWSTG is the Nation's
    critical telecommunications hub for collecting, processing, and
    distributing weather data and information. The data processed by the
    NWSTG are used by hundreds of customers worldwide but the current NWSTG
    facility, located in NWS headquarters in Silver Spring, MD has no
    operational backup and is therefore a single point of failure
    vulnerable to natural disasters, human error, computer viruses, hacker
    attacks, and terrorism. This investment will mitigate these risks and
    will enable NOAA to comply with Presidential Directives on critical
    infrastructure protection and continuity of government operations.
        NOAA requests a total of $0.3 million to begin to address the
    critical single point of failure for NOAA's satellite products. This
    investment will fund a study to evaluate the backup capabilities for
    critical satellite products and services currently delivered from
    Federal Building 4 in Suitland, MD. This initiative is essential to
    address the potential for a catastrophic outage, which would prevent
    the delivery of critical satellite data and products to the NWS. In the
    event of such an outage, approximately 85 percent of the information
    used in weather forecast models would be lost, seriously limiting the
    ability to make accurate weather forecasts. This would be particularly
    dangerous if data was not available during times of severe weather
    events.
        NOAA requests a total of $4.6 million to ensure Continuity of
    Critical Facilities for Satellite Operations. This investment will
    allow NOAA to address deficiencies and risks associated with the
    infrastructure of the NOAA environmental satellite command and control
    centers at Wallops, VA and Fairbanks, AK. This initiative forms a
    cohesive approach to resolving known infrastructure problems by
    reducing facilities' threats and risks, and completing the renovation/
    repair of the Satellite Operations Control Center. These problems could
    jeopardize NESDIS' ability to control the Nation's environmental
    satellite systems and potentially lose in- orbit assets.
                Construction ($16.0 million)
        NOAA requests a total of $3.0 for the Honolulu laboratory. This
    investment will continue the replacement of the Honolulu Laboratory
    which consists of a main lab building and two annex building. This
    funding will enable the project to proceed with work needed to correct
    several deficiencies such as overcrowding, lack of laboratories,
    inadequate or nonexistent handicap access, and hazardous materials.
        The total request of $12.0 million for National Weather Service
    (NWS) Weather Forecast Office Construction represents an increase of
    $2.5 million above the fiscal year 2001 enacted level. This continued
    investment will ensure the continuation of critical facility
    modernization efforts in the NWS. In fiscal year 2002, NWS plans to
    finalize construction of the new Weather Forecast Office in Caribou,
    Maine and complete the new Alaska Tsunami Warning Center in Palmer,
    Alaska. NWS also plans to complete modernization of the weather offices
    in Hilo, Hawaii and Kotzebue, Alaska.
        The fiscal year 2002 Presidents Budget request includes a total of
    $1.0 million for the Coastal Services Center Wing. This investment will
    allow for construction of a new wing adjacent to the main facility of
    the Coastal Services Center (CSC) in Charleston, SC. This small
    expansion will add an estimated 6,000 square feet to house office
    space, a storage area and a loading dock. The funding will also allow
    for a partial demolition of CSC's obsolete and deteriorating
    structures. The demolition would eradicate some, but not all, of the
    structures that pose threats to CSC's inhabited buildings. Additional
    needs for security enhancements and other expansion remain under
    consideration in the comprehensive facilities plan being completed in
    fiscal year 2001.
                Maintenance ($24.4 million)
        The total request of $4.4 million for the National Marine Fisheries
    Service Facilities Operations and Maintenance represents an increase of
    $0.4 million above the fiscal year 2001 enacted level. This continued
    investment will be used to cover increased operation and maintenance
    costs of two key NMFS facilities, the new Santa Cruz, California
    Laboratory, and the Kodiak, Alaska Laboratory.
        The total request of $4.6 million for Weather Forecast Office (WFO)
    Maintenance represents an increase of $0.3 million above the fiscal
    year 2001 enacted level. This continued investment will allow NWS to
    fund recurring maintenance contracts and address a backlog of over $7.0
    million in deferred maintenance repair actions. WFOs provide
    forecasters with modernized facilities, supporting the advanced
    technology systems and the provision of weather service to the public.
    As the WFOs continue to age, the facilities require a significant
    investment in recurring and cyclic maintenance, including replacement
    of major facility support systems such as power backup and heating,
    ventilation, and air conditioning. The request will allow NWS to
    protect the $250 million capital investment in modernized facilities in
    accordance with GSA and private industry standards.
        NOAA's request of $3.6 million for Facilities Maintenance, Repairs
    and Safety represents an increase of $1.7 million above the fiscal year
    2001 enacted level. This continued investment will allow for
    remediation of NOAA's deteriorating facilities. NOAA's capital assets,
    totaling 496 installations spread across all 50 states are valued in
    the hundreds of millions of dollars. The majority of these facilities
    are over 30 years old, and 29 percent are over 40 years in age. To
    date, renovations have been relatively few, and maintenance has been
    deferred. NOAA has already identified over $50 million in maintenance
    and repair projects, and this continues to grow as a comprehensive
    facility assessment unfolds. Major systems in many facilities are in
    imminent danger of failure, or are well past their useful lives. The
    requested funds will help address these facilities maintenance, repair
    and safety needs.
        Funding in the amount of $1.0 million is requested for NOAA's
    Beaufort Laboratory. This investment will allow for repairs at NOAA's
    Beaufort, NC Laboratory. The funds will be used to address health and
    safety issues, primarily the installation of a sanitary sewage
    connection and electrical repairs. The Beaufort Laboratory is the
    Nation's second oldest marine research center--a national treasure--and
    is collocated with the Rachel Carson National Estuarine Research
    Reserve.
        NOAA's request of $1.8 million for the GORDON GUNTER will allow for
    the upgrade of the vessel to meet modern safety standards and to
    provide a more capable platform to support fisheries research, stock
    assessment and other missions such as submersible operations. The
    upgrade will include modifications to an engine-room bulkhead that will
    enable the ship to meet modern safety standards for one-compartment
    damage stability, allowing a compartment to be fully flooded and the
    ship to remain afloat with stability. This funding also would provide
    positioning and instrumentation upgrades. The GORDON GUNTER, homeported
    in Pascagoula, MS, is a former Navy T-AGOS vessel which has been
    converted and currently serves in the Gulf of Mexico, the Caribbean Sea
    and the Southeast Atlantic Ocean.
        Included in NOAA's fiscal year 2002 Presidents Budget request is
    $4.0 million for the ALBATROSS IV. This investment will allow for
    repairs and the extension of the ship's useful life until a new
    Fisheries Research Vessel (FRV) can be constructed for the Northeast
    Fisheries Science Center (NEFSC). In order to calibrate the new vessel
    with the ALBATROSS IV, the ALBATROSS IV must be upgraded and its
    service extended until a new vessel is completed. This calibration-
    overlap protects the integrity of long-term surveys.
        Additional funding has also been requested for the FAIRWEATHER.
    This investment is identified under the Marine Transportation System
    crosscut.
        The total request of $5.0 million for Boulder Facilities Operations
    represents an increase of $1.0 million above the fiscal year 2001
    enacted level. This provides funds for rent charges levied by the GSA
    which owns and operates the facility. This is a ``must pay'' bill,
    without which the science programs would bear the burden.
                Support ($16.5 million)
        The President's Budget request for fiscal year 2002 includes $2.3
    million for the Cooperative Observer Network, which represents an
    increase of $1.9 million above the fiscal year 2001 enacted level. This
    continued investment supports a nationwide network of over 11,000
    volunteer operated weather observing sites used by NOAA to maintain the
    Nation's climate record and to provide data to local NWS field offices.
    These sites are staffed by citizens dedicated to maintaining climate
    records and assisting the NWS. In a recent report, the National
    Research Council recommended that NOAA take immediate steps to sustain
    and modernize this critical network. NWS plans to replace 900 rain
    gauges and 200 temperature sensors in fiscal year 2002. This is the
    first of an anticipated 3 year rescue effort which will result in the
    total replacement of 2,700 rain gauges and 5,000 temperature sensors.
        The total request of $14.2 million for Aircraft Services represents
    an increase of $2.4 million above the fiscal year 2001 enacted level.
    This continued investment will provide an additional 300 flight hours
    for data collection for a total of 1,970 flight hours. Of these
    additional flight hours, 150 flight hours are specifically for
    hurricane surveillance and for severe winter storms. Another 150 flight
    hours will support measurements of ocean winds during high windspeed
    conditions, which are critical to planning for future satellite
    sensors. These flying hours will enable NOAA to more efficiently use
    its heavy aircraft and to maintain pilot proficiency during data
    collection under severe weather conditions.
    Maintain Satellite Continuity and Severe Weather Forecasts ($712.3
            million)
        Critical to meeting our 21st Century mission is the continuity of
    NOAA's Satellites and Severe Weather Forecasts. In order to ensure our
    success, the fiscal year 2002 President's Budget Request includes a
    total of $712.3 million, of which $127.1 million is new funding. The
    programs that comprise this initiative are summarized in the preceding
    table and the program descriptions below.
                Satellite and Data Services ($693.8 million)
        NOAA's total request of $65.0 million for Environmental Observing
    Services represents an increase of $14.3 million above the fiscal year
    2001 enacted level. This continued investment supports the operations
    of all of the NESDIS satellite systems, the ingesting and processing of
    satellite data, and the development of new product applications
    required for continuity of operations. NESDIS provides satellite
    command and control services on a 24 hours per day, 365 days per year
    schedule. Funding is required to keep up with increases in labor costs,
    software licensing, communications, and ground system maintenance.
    Requirements have expanded due to greater demands on operations and
    control, greater amounts of data requirements for new products,
    requirements for more advanced software and the development of improved
    products, and increased demand to support users.
        The total request of $146.3 million for Polar Orbiting Satellites
    represents an increase of $9.6 million above the fiscal year 2001
    enacted level. This continued investment will allow for the
    continuation of spacecraft production (NOAA K-N'). It will also allow
    for completion of the instruments for the European Meteorological
    Operational (METOP) satellites which will replace NOAA's morning polar
    orbiting satellite during calendar year 2005. Funding is included for
    upgrading and replacing aging and deteriorating ground systems to allow
    for continuation of operations for the Polar K-N' series through the
    end of its lifetime in about 2012. These ground systems are needed in
    order to communicate with the satellites until the last of the series
    is decommissioned. In addition, funds provide for replacing and
    upgrading the aging product generation and distribution system.
        Funding in the amount of $156.6 million is included in NOAA's
    budget request for the National Polar Orbiting Environmental Satellite
    System (NPOESS) represents an increase of $83.4 million above the
    fiscal year 2001 enacted level. This continued investment will allow
    for the convergence of NOAA's Polar program, the Department of
    Defense's (DOD) Defense Meteorological Satellite Program and National
    Aeronautic and Space Agency's (NASA) research and development into a
    single satellite system that will save the United States Government
    millions of dollars over the life of the program. NPOESS is essential
    to meeting both NOAA's requirements in weather forecasting,
    oceanography, climate and search and rescue services as well as the
    DOD's National Security mission. NOAA has only three remaining current
    generation satellites on the ground to use until the first NPOESS
    satellite is delivered in late 2008. NPOESS needs to stay on schedule
    as provided for in this fiscal year 2002 Budget Request to help ensure
    that polar data continuity is maintained. NPOESS satellites are
    critical for weather forecasting, climate observations, U.S. military
    operations on a worldwide basis, and search and rescue operations.
        The total request of $293.3 million for the Geostationary Orbiting
    Environmental Satellite (GOES) Program represents an increase of $3.1
    million above the fiscal year 2001 enacted level. This continued
    investment will fund the spacecrafts and launch services, including the
    launch vehicle and launch control personnel. Funding is necessary to
    maintain continuity of geostationary operations.
        NOAA requests a total of $1.2 million for the Commercial Remote
    Sensing Licensing Program. This investment will ensure the timely
    review and processing of satellite license applications. Under the Land
    Remote Sensing Policy Act of 1992 (as amended in 1998), NOAA is charged
    with licensing and enforcing licenses of the U.S. private sector remote
    sensing industry. Funding will be used to establish a program to
    provide technical support for such reviews, support of an industry
    advisory mechanism, and computer infrastructure. Major monitoring and
    compliance activities will include review of quarterly licensee
    reports, on-site inspections, audits, license violation enforcement,
    and implementation of shutter control in national security and foreign
    policy crisis situations.
        The total request of $31.4 million for Data and Information
    Services--operational activities represents an increase of $6.5 million
    above the fiscal year 2001 enacted level. This continued investment is
    for core operational activities and will increase the Data Centers
    capacity to ingest, process, and archive data as well as continue the
    rescue of valuable environmental data. Requirements have expanded due
    to growing customer demands for data and products, and increased data
    management has become a necessity as the volume of new data continues
    to grow. Combined with other funding for fisheries oceanography,
    habitat characterization, the climate reference network, climate
    database modernization, and environmental data systems modernization,
    these funds support NESDIS' Data and Information sub-activity request.
                Severe Weather Forecasts ($18.5 million)
        The total request of $3.7 million for the U.S. Weather Research
    Program (USWRP) represents an increase of $2.2 million above the fiscal
    year 2001 enacted level. This continued investment in research will
    improve the accuracy of hurricane landfall predictions for location,
    intensity, and rainfall estimates. Decreased error and uncertainty in
    hurricane forecasts will save lives and will help reduce the length of
    coastline recommended for evacuation during these powerful storms. This
    will allow localities to avoid millions of dollars worth of unnecessary
    preparations, and, at the same time, encourage those in the warned
    areas to have greater confidence in the accuracy of the warnings. The
    USWRP is a partnership between NOAA, other Federal Agencies, and
    universities.
        NOAA's total request of $5.1 million for Automated Surface
    Observing Systems (ASOS) represents an increase of $1.3 million above
    the fiscal year 2001 enacted level. This continued investment will
    complete the acquisition of 346 new ASOS dewpoint sensors. The existing
    dewpoint sensors fail on average every ten days and have the highest
    failure rate in the ASOS suite of sensors, and consequently are in need
    of replacement. These funds will also complete the acquisition of 346
    new ASOS processor units which are needed because the current
    processors are over capacity. Lastly, these funds will allow NOAA to
    begin acquisition of the all-weather precipitation gauge necessary for
    climate record continuity and aviation safety. In fiscal year 2002,
    NOAA will acquire 115 all-weather precipitation gauges.
        The fiscal year 2002 total request of $5.9 million for the National
    Center for Environmental Prediction (NCEP)--Environmental Modeling
    Center represents an increase of $1.7 million above the fiscal year
    2001 enacted level. This continued investment will sustain operations
    at NCEP's Environmental Modeling Center (EMC). The EMC develops the
    computer models and other numerical forecast products which provide the
    basic guidance that forecasters use in making weather and climate
    forecasts. Today, the EMC is overly dependent on external sources of
    funding for its operations, degrading its ability to transfer proven
    weather forecasting science into NWS operations. The National Research
    Council in its report From Research to Operations in Weather Satellites
    and Numerical Weather Prediction: Crossing the Valley of Death, states
    ``Almost all of the Nation's operational weather and climate guidance
    products come from EMC, which does not presently possess the necessary
    resources to transfer many of the U.S. advances in observations and
    modeling to operations.'' In fiscal year 2002, NWS plans to provide
    direct base support for its suite of operational forecast models,
    including the aviation, regional, and global models.
        NOAA requests a total of $3.8 million for Data Assimilation and the
    Joint Center for Satellite Data Assimilation. This request comprises
    $3.0 million for data assimilation and $0.8 million for the Joint
    Center for Satellite Data Assimilation. The investment for data
    assimilation will allow NOAA to improve data assimilation and modeling
    at the National Center for Environmental Prediction (NCEP). Data
    assimilation is the collection and processing of weather observations
    (satellite, aircraft, radar, data buoys, upper-air balloons) for use in
    operational numerical weather prediction models. These models are the
    foundation for all short and medium range and severe weather forecasts
    including aviation, marine, hurricane, rainfall, and severe weather.
    This critical funding request aims to improve forecasts through the use
    of enhanced satellite data and other data-sets in the NCEP prediction
    models, leveraging one of the Nation's largest capital investments in
    global and environmental observing systems. Investment in data
    assimilation ensures that the large investment in observing systems and
    computers has maximum benefit for the public.
        In addition to data assimilation, $0.8 million will be used to
    establish the Joint Center for Satellite Data Assimilation with NWS,
    NESDIS and NOAA Research in order to accelerate and improve the use of
    satellite data in forecast models. The core scientific staff and
    computing facilities of this ``virtual'' Center will consist of current
    NOAA resources. This request will allow for NOAA to accelerate the use
    of current and future satellite data in NWS weather and climate
    prediction operations. In addition to the NOAA contributions, NASA,
    with a similar level of support, will be a partner in a coordinated
    national effort to realize the full potential of the vast quantities of
    new satellite data that are becoming available. This center will make
    more effective use of NOAA remotely sensed data as well as integrate
    NASA, Department of Defense, and international satellite data into
    NOAA's operational models.
                Coastal Conservation Activities ($284.4 million)
        Over the past several years NOAA has proposed, through various
    initiatives and programs, funding to address some of the most serious
    challenges facing the U.S. coasts and oceans. Through those programs
    NOAA has made significant progress in addressing a number of critical
    environmental issues. The Coastal Conservation Activities Initiative
    will continue to build on the progress made to preserve the Nation's
    coasts and oceans.
        In the fiscal year 2002 President's Budget, NOAA requests $284.4
    million to continue environmental programs that are critical to
    ensuring the continued preservation of our Nation's coastal and ocean
    resources. The fiscal year 2002 Budget Request includes resources to
    enhance our ability to effectively manage the National Marine
    Sanctuaries, enhance habitat protection through the National Estuarine
    Research Reserve System and strengthen and improve Marine Protected
    Area (MPA) programs and their conservation goals. These funds will be
    leveraged through improved Federal, state, local, tribal, and
    territorial coordination and collaboration to fill shared information,
    technical and operational needs. Also included are additional resources
    to increase Coastal Zone Management grants to states to enable coastal
    states to address such issues of national importance as the impact of
    coastal storms, declining water quality, shortage of public shoreline
    access, loss of wetlands, deteriorating waterfronts, and the challenge
    of balancing economic and environmental demands in the coastal zone.
    With the funds requested in fiscal year 2002 NOAA will also continue to
    implement recommendations of the Coral Reef Task Force and enhance the
    recovery of threatened and endangered coastal salmon. The programs that
    comprise the Coastal Conservation Activities cross-cut are highlighted
    below.
                Coral Reef Activities ($27.7 million
        The total request of $27.7 million for Coral Reef Activities
    represents an increase of $0.7 million above the fiscal year 2001
    enacted level. This continued investment will allow for NOAA's support
    for coral reef activities across the Nation. Funding will enable NOAA
    to continue implementing priorities of the U.S. Coral Reef Task Force
    and recommendations included in the America's Ocean Future Report.
    Working with state, territorial, and local partners, this level of
    funding will support research, monitoring, and local level projects to
    reduce human impacts and increase sustainable use of America's valuable
    coral reefs.
                Coastal Zone Management Program ($75.4 million)
        The total request of $75.4 million for the Coastal Zone Management
    (CZM) Program represents an increase of $12.2 million above the fiscal
    year 2001 enacted level. This includes an increase of $8.6 million for
    CZM grants, a technical change in the transfer from the CZM Fund, and
    an increase of $0.4 million for Program Administration. In addition,
    $10.0 million is requested for Nonpoint Pollution Implementation
    Grants, a separate but integral program, which will be discussed later.
        The total request of $69.0 million for CZM Grants represents an
    increase of $8.6 million over the fiscal year 2001 enacted level. This
    continued investment will allow NOAA to provide direct grants to
    coastal states for implementing and improving their approved coastal
    management programs. Currently 33 of the 35 eligible coastal states
    have an approved coastal management program, with approval of the 34th
    state program, Indiana, expected in fiscal year 2002. Combined, these
    programs serve to manage and protect 99.9 percent of the Nation's
    shoreline to the benefit of the environment and the economy. The
    requested investment would provide resources for coastal states to more
    fully implement their coastal management plans. Specifically, NOAA
    provides grants to coastal states and territories to address issues of
    national importance such as the impact of coastal storms and flooding,
    declining water quality, shortage of public access to the shoreline,
    loss of wetlands, deteriorating waterfronts and harbors, and the
    challenge of balancing economic and environmental demands in
    increasingly competitive ports.
        In order to streamline CZM administrative processes, NOAA proposes
    to consolidate all funding for CZM Program Administration under ORF.
    Doing so requires replacement of the $3.2 million that had been
    transferred from the CZM Fund (a non-ORF account) in prior years. In
    fiscal year 2002, the CZM Fund is proposed as a general offset to CZM
    Act activities.
        The total request of $6.4 million for the CZM Program
    Administration represents an increase of $0.4 million above the fiscal
    year 2001 enacted level. This continued investment will support NOAA's
    national program administration responsibilities under the Coastal Zone
    Management Act (CZMA), which continues to grow. This request will
    assist NOAA's ability to bring together representatives from state,
    Federal, and tribal governments and the private sector, to address
    issues such as coastal hazards, habitat and polluted runoff. It will
    allow NOAA to address the increasing requests of the states (33 in the
    program, one state program in development) for support and technical
    assistance. This level of funding will also enable NOAA to maintain
    national support for the 25 National Estuarine Research Reserves.
                Nonpoint Pollution Implementation Grants ($10.0 million)
        NOAA requests a total of $10.0 million for Nonpoint Pollution
    Implementation Grants. This investment will provide states with
    resources to reduce nonpoint pollution, the greatest single threat to
    coastal water quality. Coastal waters are increasingly impacted by
    polluted runoff. Symptoms include the impacts of Pfiesteria in coastal
    waters of the eastern seaboard, nutrient over-enrichment in the Gulf of
    Mexico, the loss of salmon fisheries in the Pacific Northwest and local
    closures of shellfish beds and beaches throughout the country. NOAA
    will provide grants to states with approved plans to address the causes
    of these and other symptoms of the degradation of our coastal water
    quality.
                National Estuarine Research Reserves ($26.3 million)
        The total request of $26.3 million for the National Estuarine
    Research Reserves (NERRS) represents a decrease of $29.3 million below
    the fiscal year 2001 enacted level. This funding level supports an
    increase in operations of $1.7 million for a total of $16.4 million in
    the Operations, Research and Facilities (ORF) Account, and a decrease
    in one-time construction items of $24.5 million, for a total request of
    $9.9 million in the PAC Account. With regard to the increase for NERRS
    operations, these funds will improve the ability of NOAA and its state
    partners to understand, manage, and protect these special estuarine
    habitats and biodiversity. The NERRS is a network of protected areas
    established to improve the health of the Nation's estuaries and coastal
    habitats through long-term research, protection, and education and to
    address such issues as water quality, loss and degradation of habitat,
    and loss of species biodiversity. The increase will significantly
    enhance the monitoring and technical training programs at the 25
    designated reserves, and ultimately lead to healthier estuaries,
    coastal water quality, and fisheries.
        Of particular interest is the NERRS' System-Wide Monitoring Program
    (SWMP). The SWMP is a national monitoring system that will integrate
    water quality, and biological and land-cover change elements, making
    the information available to scientists and managers. The 25 existing
    reserves will expand their participation in SWMP by increasing spatial
    coverage of water quality stations, and by monitoring additional
    biological indicators. Reserve staff will also improve estuarine
    resource management by providing enhanced technical training for
    planners, policy-makers, and other state and local coastal decision-
    makers on water quality, habitat, invasive species, and sustainable
    ecosystem issues.
        Funding of $9.9 million for infrastructure investments in the
    Procurement, Acquisition, and Construction (PAC) account includes
    resources to complement these activities by providing resources for
    research, education, and visitor facilities at multiple reserve sites
    across the Nation. The NERR system uses a competitive priority-setting
    process each year to fund the best projects from the long list of
    eligible proposals. At some sites, land acquisition from willing
    sellers may be a high priority to enhance the protection of key
    resources. At other sites, facilities and related structures, such as
    interpretive centers, laboratories, boardwalks, and boat docks may be
    the best use of funds to enhance the outreach, education, and research
    programs within the NERRS.
                National Marine Sanctuaries ($52.0 million)
        The total request of $52.0 million for the National Marine
    Sanctuaries represents an increase of $16.6 million above the fiscal
    year 2001 enacted level. This increase of $16.6 million is comprised of
    $3.6 million for operations (for a total ORF request of $36.0 million),
    and an increase of $13.0 million for new construction (for a total PAC
    request of $16.0 million). With regard to National Marine Sanctuaries
    operations, this continued investment will provide funding to upgrade
    the operating and technical capacity in the thirteen national marine
    sanctuaries. The results will improve protection of important sanctuary
    resources, including coral reefs, endangered marine mammals, sensitive
    habitats, and significant cultural resources. In addition to supporting
    the operations, this investment will provide for additional site
    characterization, additional enforcement capabilities, public
    education, and the implementation of key management changes. Changes
    are expected in a wide range of activities, including drafting and
    amending regulations, establishing new partnerships, expansion of
    outreach and education efforts, and additional research, monitoring and
    restoration.
        The Congress has called for sufficient resources for operational
    staff, facilities and equipment, effective implementation of management
    plans, enforcement, and particularly for site characterization
    including cultural resources and inventory of existing natural
    resources. Elements that must be compiled for cultural and natural
    resource inventories include location of shipwrecks, data on marine
    mammals, fish, shellfish and sea birds, habitat types, and physical
    characteristics, such as bottom typography, water quality, and water
    temperature. The goal is to gather enough characterization information
    at each site to be able to effectively manage the resources. New
    funding will support these efforts and the Sustainable Seas
    Expeditions. This fiscal year 2002 Budget responds to Congressional
    direction and the recently passed National Marine Sanctuary Amendments
    Act.
        With regard to the increase of $13.0 million for Marine Sanctuaries
    construction in the PAC Account, NOAA will continue to implement the
    detailed, comprehensive facilities plan developed in fiscal year 2000
    in order to respond to the growing public interest in the ocean
    environment and the Marine Sanctuary System. NOAA will work in
    partnership with other Federal agencies and private institutions such
    as museums, aquaria, and foundations. NOAA will establish or upgrade
    facilities to ensure access to sanctuary resources and allow public
    appreciation of the unique marine habitats in those sanctuaries. These
    facilities provide important outreach and education functions for these
    special places, since many visitors are unable to visit the actual
    sanctuary sites which, in several cases, are many miles offshore or
    require individuals to be certified scuba divers in order to view
    firsthand these national treasures.
        Within these funds, an estimated $6.5 million is targeted for the
    Dr. Nancy Foster Florida Keys Environmental Center to complete
    renovation and construction at this former Navy installation and
    properly support the multi-agency partnership and the Center's mandates
    to promote environmental education, protection, marine safety and
    rescue, and coastal stewardship. This center, which was dedicated last
    year, stands as a tribute to the late Dr. Nancy Foster, NOAA's
    Assistant Administrator for the National Ocean Service. One of the two
    buildings will host a state-of-the-art multi-agency (NOAA, National
    Park Service, Fish & Wildlife Service) visitor center. The other
    building will become the operations center for the Florida Keys
    National Marine Sanctuary and host office space; laboratory space; a
    diving locker; a maintenance area for mooring buoys, boats and
    vehicles; and dock space. The new facility will also provide
    consolidation of office space and boat docks that are currently
    scattered across multiple leased facilities in the Key West area.
                Marine Protected Areas ($3.0 million)
        NOAA requests a total of $3.0 million for Marine Protected Areas.
    This investment will strengthen and improve agency-wide Marine
    Protected Area (MPA) programs and their conservation goals. This effort
    supports NOAA's responsibilities for fulfilling the National Marine
    Sanctuaries Program, National Estuarine Research Reserve Program,
    Coastal Zone Management Program, and coral reefs. This funding will
    foster collaboration with the Department of the Interior and other
    Federal agencies, state, local, tribal and territorial governments as
    well as non-governmental partners. Efforts will focus on developing a
    supporting framework for effective communication and collaboration
    among MPA programs by creating a national system of marine protected
    areas including NMS, NERRS, and other Federal, state, and tribal marine
    protected areas. These funds will also support preparation of the first
    comprehensive inventory and assessment of the existing system of U.S.
    MPAs. The NOAA MPA Program will consist of a Marine Protected Areas
    Center, comprised of a small core staff in Washington, DC and two
    regional Institutes of Excellence.
                Pacific Coastal Salmon Recovery Fund ($90.0 million)
        The total request of $90.0 million for the Pacific Coastal Salmon
    Recovery Fund represents an increase of $0.2 million above the fiscal
    year 2001 enacted level. This continued investment will allow the
    states and tribes to continue support for habitat restoration and
    protection, research and enhancement, monitoring and evaluation, and
    salmon recovery planning and implementation efforts. Funding will be
    used to enhance Pacific coastal salmon recovery and for the purpose of
    helping share the costs of state, tribal and local conservation
    initiatives. Programs funded within this account will assist in the
    conservation of Pacific salmon runs, some of which are at risk of
    extinction in the states of California, Oregon, Washington, and Alaska.
    Funds provided to these states will have at least a 25 percent matching
    requirement. This request responds to current and proposed listings of
    coastal salmon and steelhead runs under the Endangered Species Act by
    forming lasting partnerships with states, local and tribal governments
    and the public for saving Pacific salmon and their important habitats.
                Climate Services ($34.7 million)
        From the storms of next week to the drought of next season to the
    potential human-induced climate change over the coming century, issues
    of climate variability and change will be continue to be a major issue
    for the Nation. Whether responding to the ongoing drought in the
    Pacific Northwest and its effect on power generation and endangered
    salmon, or in determining how much atmospheric carbon dioxide is taken
    up by the North American biosphere, these questions influence users
    from the Western water manager to the shapers of national policy. The
    challenge is to extend the research successes, maintain the
    observational backbone, and improve the capability to provide useful
    information services to our customers. Improved climate predictions
    will enable resource managers in climate sensitive sectors such as
    agriculture, water management, and energy supply to alter strategies
    and reduce economic vulnerability. Building on the understanding of the
    Earth's climate system that has resulted from the Nation's strong
    scientific research and numerical modeling programs, this Climate
    Observations and Services Program will begin the transition of research
    data, observing systems and understanding from experiments to
    applications, and from basic science to practical products.
        NOAA maintains a balanced program of focused research, large-scale
    observational programs, modeling on seasonal-centennial time scales,
    and data management. In addition to its responsibilities in weather
    prediction, NOAA has pioneered in the research and operational
    prediction of climate variability associated with the El Nino Southern
    Oscillation (ENSO). With agency and international partners, NOAA has
    been a leader in the assessments of climate change, stratospheric ozone
    depletion, and the global carbon cycle. NOAA scientists have been
    leaders internationally in the Intergovernmental Panel on Climate
    Change (IPCC). It maintains national coordination through participation
    in the U.S. Global Change Research Program.
        The agency-wide Climate Observations and Services activity
    represents a partnership that allows NOAA to facilitate the transition
    of research observing and data systems and knowledge into operational
    systems and products. During recent years, there has been a growing
    demand from emergency managers, the private sector, the research
    community, decision-makers in the United States and international
    governmental agencies and the general public to provide timely data and
    information about climate variability, climate change and trends in
    extreme weather events. The economic and social need for continuous,
    reliable climate data and longer-range climate forecasts has been
    clearly demonstrated. NOAA's Climate Observations and Services
    Initiative responds to these needs. The following efforts will be
    supported by this initiative:
                Continuing Climate Services ($11.0 million)
        The total funding request for NOAA's Continuing Climate Services is
    $11.0 million. These continued investments will allow NOAA to build on
    the climate activities started in fiscal year 2001.
        NOAA's fiscal year 2002 budget request includes $3.0 million for
    the Climate Reference Network. In order to ensure NOAA's capability to
    monitor very long-term changes of temperature and precipitation, a
    climate reference network consisting of several hundred stations must
    be developed by making use of the historical data from the best sites
    in the network of 11,000 cooperative observing sites. This climate
    reference network will build on data from stations identified as those
    with the longest environmentally stable records, most dedicated
    observers, and most reliable data with few interruptions.
        Also included in NOAA's request of $1.0 million for improving the
    Availability of Climate Data and Information: $1.0 million. As the
    observational capabilities increase and the observing networks expand,
    it is essential that data management and dissemination systems are in
    place to make the resulting data and information widely and easily
    accessible to public and private sector decision makers. During recent
    years, NOAA has struggled to respond adequately to questions from
    industry, the general public, and the Government regarding potential
    changes in weather and climate events. NOAA is developing the required
    infrastructure to assemble, develop, and communicate the data,
    information, and knowledge about the trends, likelihoods, and future
    expectations of climate and weather events.
        The request for funding for Baseline Observatories is $2.0 million.
    Funding for this activity is for operations at NOAA's remote manned
    Global Atmospheric Baseline Observatories, measuring up to 250
    different atmospheric parameters relevant to the study of climate
    change at: Barrow, AK; Mauna Loa, HI (since 1957); American Samoa; and
    the South Pole, Antarctica (also since 1957). These observations are
    critical to the collection and continuity of the world's longest
    atmospheric time series, supplying the scientific community with
    information on the state and recovery of the ozone layer, global carbon
    dioxide, and other trace gases impacting the global climate.
        NOAA's request for Ocean Observations in fiscal year 2002 is $5.0
    million. NOAA maintains the sustained global observing and data
    stewardship system necessary for climate research and forecasting as
    well as the long-term monitoring system necessary for climate change
    detection and attribution. The observation network is based on a set of
    ``core'' observations (e.g., temperature, surface wind stress,
    salinity, sea level, carbon dioxide), consisting of both in-situ and
    remotely sensed measurements, that have been identified in NOAA and
    other national and international reports as needed to satisfy research
    and operational climate requirements.
                Regional Assessments, Education and Outreach ($1.9 million)
        NOAA requests a total of $1.9 million for Regional Assessments,
    Education and Outreach. This investment will allow for regional
    assessments, education and outreach related to climate variability. The
    impacts of climate variability from season-to-season or year-to-year
    manifest themselves on regional and local levels. The goal is
    utilization of climate variability information by regional and local
    managers and decision-makers to maximize economic gain and mitigate
    potential harmful impacts.
                Weather-Climate Connection ($0.9 million)
        NOAA requests a total of $0.9 million for Weather-Climate
    Connection. This investment will assist in understanding predictions
    variability beyond the El Nino Southern Oscillation (ENSO) and
    predicting the weather-climate connection. As during El Nino, other
    sub-seasonal tropical fluctuations can also lead to shifts in the
    Pacific storm track, affecting the paths of storms approaching the U.S.
    west coast, and influencing weather across the entire country. Sub-
    seasonal tropical-mid-latitude interactions thereby provide a
    potentially important additional source of predictability beyond ENSO.
    NOAA will expand its diagnostic and modeling efforts to understand the
    relationship between sub-seasonal tropical variability and changes in
    the frequency, location and intensity of extreme weather events over
    the United States, and document the structure of variations in tropical
    rainfall on weekly to monthly time-scales, as well as air-sea
    interactions in both tropical systems and in mid-latitude oceanic and
    land-falling storms.
                Carbon Cycle ($2.3 million)
        NOAA requests a total of $2.3 million for the Carbon Cycle. This
    investment, as part of a multi-agency effort, will allow NOAA to
    establish a network of more densely spaced airborne and tall-tower
    based sampling sites over North America. The U.S. scientific community
    recently completed a plan for an integrated carbon cycle science
    program which aims to quantify, understand and project the evolution of
    global carbon sources and sinks in order to better predict future
    climate.
                Ocean System for Improved Climate Services ($7.3 million)
        NOAA requests a total of $7.3 million for the Ocean System for
    Improved Climate Services. This investment will contribute to the
    global operational ocean-observing system by enhancing its present
    components and establishing new components. Of the $7.3 million
    requested, $3.2 million is required to support the U.S. commitment to
    deploy and maintain 1,000 ARGO profiling floats in the proposed global
    array of 3,000 floats. This commitment requires a deployment of 280
    ARGO floats per year. The remainder of this request, $4.1 million,
    supports other observational components including Arctic Ocean fluxes,
    ocean reference stations, oceanic carbon, and augmentation of the
    volunteer observing ship (VOS) instrumentation. Finally, investments
    are to be made for data management and assimilation. Based on a firm
    scientific foundation, this ocean observing system is closely coupled
    with other United States and international observing efforts, and will
    greatly improve the data available for understanding climate variation.
                Climate Change Assessments ($0.7 million)
        NOAA requests a total of $0.7 million for Climate Change
    Assessments. This investment will continue contributions to
    environmental assessments that have become the primary tool to deliver
    climate information to governments, industry, the scientific community
    and the general public. Over the past two years NOAA has led and
    contributed to Ozone assessments under the Montreal Protocol, the
    Intergovernmental Panel on Climate Change (IPCC), and U.S. National
    Assessments. This investment will support NOAA's leadership in
    assessing climate change and its global impact on the United States and
    other communities.
                High Performance Computing and Communications Program/
                        Geophysical Fluid Dynamics Laboratory: $7.0 million
        The total request of $7.0 million (in the PAC Account) for the High
    Performance Computing and Communications (HPCC) Program and Geophysical
    Fluid Dynamics Laboratory represents an increase of $3.0 million above
    the fiscal year 2001 enacted level. This continued investment will
    provide full-year support for the High performance supercomputer system
    at NOAA's Geophysical Fluid Dynamics Laboratory (GFDL). The system will
    be used full-time to attack some of the most difficult but critical
    obstacles to developing and testing new and more realistic models for
    predicting climatic variability, detecting climate change, and
    forecasting hurricanes. Expansion of GFDL's supercomputer is needed to
    answer questions regarding long-term global warming and to evaluate
    various scenarios reflecting different levels of anthropogenic
    influences on the atmosphere.
                Comprehensive Large-Array data Stewardship System ($3.6
                        million)
        The total request of $3.6 million for the Comprehensive Large-Array
    data Stewardship System (CLASS) represents an increase of $1.6 million
    in the Procurement, Acquisition and Construction (PAC) Account. This
    continued investment will afford efficient management of high volumes
    of data, including radar and satellite data, as well as data from
    radiosondes and ocean data buoys. This data is critical to the joint
    U.S. Global Change Research Program (USGCRP) and the scientific
    community. Significant increases in the volume of data require a rapid
    expansion in storage capacity, currently located in Asheville, NC.
    Similarly, telecommunications and automated access systems upgrades are
    needed to ensure easy and efficient access to the data.
                Modernization of NOAA Fisheries ($143.8 million)
        The fiscal year 2002 President's Budget Request for the National
    Marine Fisheries Service (NMFS), referred to as ``NOAA Fisheries,''
    follows Congressionally enacted levels in fiscal year 2001 and invests
    in core programs needed for NOAA to meet its mission to manage
    fisheries, rebuild stocks, and protect endangered species such as sea
    turtles and whales. NOAA Fisheries modernization funds will be
    allocated within NMFS to ensure that existing statutory and regulatory
    requirements are met for fisheries and protected species management
    programs (including the Magnuson-Stevens Act, National Environmental
    Protection Act, Endangered Species Act, Marine Mammal Protection Act,
    and other statutory requirements). In fiscal year 2002, there are
    sufficient funds for NMFS to meet its statutory and regulatory
    requirements.
        This budget request builds upon last year's effort to begin the
    modernization of NOAA Fisheries. The Modernization of NOAA Fisheries
    Initiative encompasses a long-term commitment to improve the NMFS'
    structure, processes, and business approaches to meet its mission of
    sustaining the Nation's living marine resources and their habitat. This
    initiative focuses on improving NMFS' science, management, and
    enforcement programs and beginning to rebuild its aging infrastructure.
    These improvements will result in measurable progress in the biological
    and economic sustainability of fisheries and protected resources. In
    order to ensure the viability of these modernization efforts, the
    fiscal year 2002 President's Budget Request includes the following
    program investments:
                Science ($54.6 million)
        A total of $1.9 million is requested for research and monitoring
    activities for the South Florida ecosystem, an increase of $0.6 million
    over the fiscal year 2001 enacted level. As a result of the U.S. Army
    Corps of Engineers construction projects within the Florida Everglades,
    NMFS must monitor the impact of inland restoration efforts and the
    changing freshwater inflow on Florida Bay habitats, nutrient flow,
    hydrodynamics, and ultimately on measurable ecosystem productivity and
    health.
        The total request of $15.0 million for Expanding Annual Stock
    Assessments represents an increase of $13.3 million above the fiscal
    year 2001 enacted level. This continued investment will provide for
    additional scientific survey data collection to improve NMFS' ability
    to make accurate, timely stock predictions. Funding at this level would
    add 829 chartered ship days toward the deficit of 2,564 days identified
    in the NMFS Stock Assessments Improvement Plan as needed for adequate
    stock assessment coverage. Included in this increase is $1.0 million to
    enhance the assessment of marine mammal population status and trends as
    required by the Marine Mammal Protection Act.
        A total request of $2.0 million for fisheries oceanography
    represents a $2.0 million increase above the fiscal year 2001 level.
    This request is comprised of two increases, $1.5 million for NMFS and
    $0.5 million for fisheries oceanography within the National
    Environmental Satellite, Data and Information Service (NESDIS). The
    $1.5 million increase will enable NMFS to assess how long-term
    environmental factors affect fish stocks. By better identifying the
    potential environmental causes of fish population fluctuations, NMFS
    will be able to improve its stock predictions and resultant management
    actions. The $0.5 million increase will enable NESDIS to explore using
    Synthetic Aperture Radar technology and data in fishery resources
    monitoring. This investment would build on applications demonstrated in
    October 1999 using RADARSAT-1 imagery in Alaska, and would result in
    radar data and products useful in fisheries enforcement, NMFS
    laboratories and for other agencies such as the Coast Guard.
        NOAA requests a total of $1.0 million to promote environmentally
    sound marine aquaculture. NOAA will improve the aquaculture regulatory
    framework by developing and implementing of a code of conduct for
    responsible aquaculture. NOAA will also address the important
    environmental aspects of aquaculture in the non-indigenous species
    area, especially for shrimp viruses.
        NOAA requests a total of $1.0 million for Pacific highly migratory
    species research. This request would fund growing and critical research
    needs as a new Fishery Management Plan for these species is
    implemented. Activities include: conducting stock assessments and
    biological studies for four major tuna species and three species of
    sharks, conducting research to evaluate the extent of bycatch and
    effectiveness of mitigation measures in purse seine fishing using fish
    aggregating devices, and developing and implementing assessment
    methodologies tailored for highly migratory species.
        A total request of $6.0 million for Cooperative Research represents
    an increase of $0.5 million over the fiscal year 2001 enacted level.
    This request will expand cooperative research activities in the
    Southeast and will involve fishermen in designing and conducting
    research programs, utilizing their expertise and insights in resource
    survey design and interpretation. By working together to design and
    implement data collection programs, these partnerships between NMFS and
    the industry significantly strengthen fisheries research. This
    Southeast cooperative research effort compliments similar efforts,
    including Northeast Cooperative Research funded at $5.0 million,
    cooperative research coordinated by the Northeast Consortium funded at
    $5.0 million and, and National Cooperative Research efforts, funded at
    $3.0 million.
        A total request of $4.4 million for expanding economic and
    statistics research represents a $1.4 million increase over the fiscal
    year 2001 level. This request is needed to conduct economic and social
    assessments of management alternatives by improving NMFS' economic and
    social science staff capability, and initiation of data and applied
    research programs. This funding will enable NMFS to better evaluate and
    predict the economic and community impacts of potential management
    actions, and satisfy statutory, regulatory and Executive Order
    requirements for assessing the benefits and costs of fisheries
    management and protected species management actions.
        NOAA requests a total of $8.0 million for the National Fisheries
    Information System. This investment will begin the implementation of a
    National Fisheries Information System to improve the quality,
    timeliness, coverage and access to data collected by state and Federal
    entities for use in the science and management of fisheries. This
    system will be developed in cooperation with the fishing industry,
    states, interstate fisheries commissions, and other stakeholders as
    outlined under section 401 of the Magnuson-Stevens Act. The funding
    provided to the Atlantic States Marine Fisheries Commission for
    regional implementation activities in fiscal year 2001 is included in
    addition to this funding. The proposed system would improve the
    accuracy and effectiveness of existing data collection programs by
    establishing common data collection, information technology, and
    quality standards for regional programs, and integrating the results
    into unified Web-enabled information system. The proposal will also
    fill critical information gaps through initiation of new data
    collection programs that will subsequently improve living marine
    resource policy decisions by reducing data uncertainties.
        NOAA requests a total of $1.0 million to reduce fishery impacts on
    essential fish habitat. This request funds research that will focus on
    the effects of specific fishing activities on essential fish habitat,
    comparing those impacts with other sources of habitat degradation,
    monitoring habitat recovery in areas where fishing has been curtailed,
    and developing management strategies to ensure sustainable harvesting
    practices.
        NOAA requests $4.0 million for additional Fishery Observers--
    Improving Data Collection. This investment will provide for increased
    observer coverage to minimum levels around the country as required by
    regulation or to optimal levels as recommended by fisheries scientists
    for statistical validity, and initiates coverage in fisheries that were
    previously not observed. Observers are increasingly essential to
    managing fisheries and marine mammal stocks. To improve the quality of
    data collected by observers and to provide a more sound base for
    fishery management decisions, the plan includes resources to provide
    better coordination and consistency of NMFS observer program policies
    and procedures. It also provides for the development of technological
    enhancements to make the future observer program less costly and more
    efficient.
        A total request of $10.0 million for Fisheries Habitat Restoration
    represents an increase of $2.0 million over the fiscal year 2001 level.
    These funds will expand NMFS involvement in community-based restoration
    projects. This highly successful national effort encourages
    partnerships with groups outside NOAA and has regularly leveraged
    appropriated funds by factors of five to six, and by as much as ten to
    one. Presently, NOAA receives many more high-quality habitat
    restoration proposals than it has funds to support. The requested funds
    would enhance national restoration efforts to meet this enthusiastic
    demand.
        NOAA requests a total of $0.3 million for Habitat Characterization.
    This investment will allow NESDIS to develop maps of fishery habitat
    distributions in space and time, and to answer important questions with
    such maps. A computer mapping capability will be created that will
    allow spatial/statistical delineations (stratification) of the
    landscape. Such maps can represent inferred ecosystem ``potentials''
    that are critical in monitoring, assessment, and management. The system
    will allow rapid iteration of the mapping process, thus affording
    opportunities to test, modify, and document model criteria, statistical
    mapping technique, and data selection. In this manner, habitat maps can
    be adaptively maintained.
                Management ($41.9 million)
        NOAA requests a total of $1.5 million to refine essential fish
    habitat designations. This request funds programs to collect critical
    scientific data needed to identify essential fish habitat more
    precisely for managed species, enhancing the effectiveness of fishery
    management actions, and filling data gaps that can result in
    litigation.
        NOAA requests a total of $3.5 million for the Northeast Fisheries
    Management program. This investment will enable NMFS to continue
    rebuilding overfished and overcapitalized Northeast fisheries including
    groundfish and scallops by reducing the amount of fish takes by
    fishermen, thus giving the fish stocks time to recover. Funding will
    also be used, in part, to implement new and innovative cooperative
    research efforts in the Region.
        The total request of $15.6 million for Regional Councils represents
    an increase of $2.5 million above the fiscal year 2001 enacted level.
    This continued investment will support all eight Regional Councils'
    increased workload from new programs and regulations as a result of
    implementing the Sustainable Fisheries Act amendments to the Magnuson-
    Stevens Act. The Regional Councils are integral partners with NOAA in
    the management of the Nation's fisheries. NOAA is the Regional
    Fisheries Councils' only source of funding to carry out their mission.
        The total request of $6.3 million for marine sea turtle activities
    represents an increase of $3.0 million over the fiscal year 2001
    enacted level. This investment will allow NOAA to recover Atlantic and
    Pacific marine sea turtle stocks threatened by domestic and
    international fisheries interactions as well as inadequate conservation
    of marine turtles on nesting beaches.
        The total request of $4.5 million for dolphin conservation and
    recovery represents an increase of $1.0 million over the fiscal year
    2001 enacted level. This investment will allow NOAA to expand current
    activities in dolphin stock identification and assessment, to reduce
    mortality incidental to commercial fishing activities, and to initiate
    efforts to use bottlenose dolphins as an indicator of the health of the
    ecosystems they occupy.
        The total request of $3.5 million for Atlantic salmon represents
    and increase of $1.5 million over the fiscal year 2001 enacted level.
    This investment will allow NOAA to conserve and restore healthy
    populations of Atlantic salmon in the Gulf of Maine Distinct Population
    Segment (DPS) and their habitats. NOAA will use this investment to
    expand the monitoring of Atlantic salmon population dynamics, expand
    habitat assessment and conservation, enhance scientific knowledge
    related to human resource usage and development activities that are
    affecting species survival, and strengthen evaluations to minimize risk
    through coordinated planning, innovative partnering, and on-site
    involvement in restoration, conservation, and protection activities.
        The total request of $7.0 million for Northern Right Whales
    represents an increase of $2.0 million over the fiscal year 2001
    enacted level. This investment will allow NOAA to expand current
    Northern Right Whale population and health assessments and recovery
    efforts in the North Atlantic and in the North Pacific.
                Enforcement ($47.3 million)
        The total request of $47.3 million for Enforcement Activities
    represents an increase of $10.0 million above the fiscal year 2001
    enacted level. This continued investment will allow NOAA to modernize
    its fisheries and protected species enforcement programs. Improved
    enforcement is essential to ensuring that fisheries regulations are
    effective and yield conservation benefits for the industry and the
    public. Of the total funding amount, $7.4 million (of which $6.1
    million is new funding) is included for additional support, continued
    modernization and expansion of the vessel management system (VMS)
    program. The VMS national program is capable of accommodating nearly
    10,000 vessels throughout a number of different fisheries. The request
    also includes $39.9 million (of which $3.9 million is new funding) to
    expand and modernize base enforcement programs. These programs include
    Alaska and west coast groundfish enforcement, protected species
    enforcement, state and local partnerships, specialized Magnuson-Stevens
    Act investigatory functions, community oriented policing and problem-
    solving, and swordfish/Patagonian toothfish import investigations.
    Modernization of the Marine Transportation System (MTS) $20.1 million
        Since our Nation's founding, maritime trade has been vital to
    economic prosperity. NOAA's lineage dates back to 1807 when President
    Thomas Jefferson called for charting the coasts and harbors. Today,
    more than 95 percent of U.S. foreign trade moves by sea. In 1998, about
    2.4 billion tons of cargo moved on our waterways and through our ports.
    U.S./foreign waterborne commerce grew about 23 percent from 1993 to
    1997--about 4.6 percent per year. Trade is projected to at least double
    by 2020. Vessels have also grown dramatically; over the last 50 years,
    the length, width, and draft of commercial vessels has doubled, pushing
    the limits of many ports and posing significant safety concerns.
    Ensuring safe and efficient port operations is vital to maintaining the
    competitiveness of the U.S. port industry and exports. Growth in ferry,
    cruise line, and recreational boating is contributing to increased
    congestion on our waterways. Nearly half of all goods in marine
    commerce are petroleum products or other hazardous materials. One key
    to reducing risk is to invest in the national information
    infrastructure that supports the safe and efficient movement of goods
    and people.
        In 1998, Congress directed Federal agencies to produce an
    assessment of the U.S. Marine Transportation System (MTS) and a plan
    for modernizing government navigation services. This fiscal year 2002
    request is NOAA's effort to direct a set of targeted investments to
    expand and capitalize on its existing programs in Mapping and Charting,
    Survey Backlog, Geodesy, Tide and Current Data, Response and
    Restoration, and Fleet Replacement to further the goals of this ongoing
    effort. This is a first step toward developing a 21st century
    transportation system that can address the major issues faced by the
    country in maritime safety, security, infrastructure, the environment,
    and competitiveness.
        NOAA maintains the Nation's suite of nautical charts, the coastal
    water level observations system, and the geodetic positioning reference
    system needed to ensure safe navigation. NOAA also maintains the
    scientific expertise to respond to hazardous releases when they occur.
    NOAA charts are developed from NOAA's hydrographic and shoreline
    surveys, tide and current measurements, and national geodetic/
    geographic positioning data, as well as information from other sources.
    Demonstration projects have shown that these programs can provide the
    accurate data necessary for determining precise under-keel and
    overhead/bridge clearances and support near zero visibility docking,
    allowing commercial vessels to more safely navigate and efficiently
    load and move cargo in and out of depth-limited harbors. NOAA's
    integrated suite of surveying, charting, water level, and positioning
    services is capable of increasing the efficient movement of goods while
    significantly reducing the risk of marine accidents and resulting
    environmental damage. When accidents do occur, NOAA can provide the
    necessary support to ensure a scientifically-based response and
    restoration of damaged coastal resources. Economic benefits include
    reducing vessel fuel consumption and port pollution, supporting just-
    in-time delivery of goods, enhancing the competitiveness of U.S.
    exports, and restoration of important coastal resources that support
    tourism, fishing, and other ocean- and coastal-dependent industries.
    Specific program increases are described in detail below.
        NOAA requests an increase of $3.6 million for Electronic
    Navigational Charts (ENCs). This continued investment will allow for
    the ongoing production and maintenance of ENCs and the ability to
    enhance and expand the full suite of ENCs to a total of 200 from the 70
    in existence at the end of fiscal year 2000. ENCs provide a more
    complete picture of coastal waterways.
        NOAA requests an increase of $1.0 million for Shoreline Mapping.
    This investment will allow for a more accurate national shoreline. An
    increased emphasis on shoreline mapping is required to keep pace with
    the growing stress on our Nation's marine transportation system and to
    assist states and coastal managers.
        NOAA requests an increase of $0.5 million for the National Spatial
    Reference System (NSRS). This investment will increase the Nation's
    access to the Continuously Operating Reference Stations (CORS), a set
    of Global Positioning System (GPS) stations, and the mainstay of the
    NSRS. This investment will expand the number of National CORS, expand
    the Federal Base and Cooperative Base Network stations connected to the
    national standard for vertical heights, which are used for all
    applications that require surveying. These activities will provide
    better access to accurate and consistent height data for a wide-range
    of economic pursuits.
        NOAA requests a total of $0.5 million to Implement Forecast Models.
    This investment will enhance tides and tidal current services to the
    user by obtaining new current meter measurements at locations critical
    to the navigation community and by accelerating the development of
    nowcast/forecast products for users of oceanographic data.
        NOAA requests a total of $3.0 million for Coastal Storms. This
    investment will build upon existing NOAA environmental monitoring and
    data management capabilities and will enhance our efforts to provide
    Marine Transportation System users, as well as coastal resource
    managers, with the data and tools needed to safely maximize commercial
    shipping, mitigate hazards, and sustain the environmental health of
    coastal communities and resources when disasters strike. Initial
    efforts will focus on a pilot project in Florida and include updating
    shallow water bathymetry, adding sensors to National Water Level
    Observation Network stations, and developing a hydrodynamic model for
    improved forecasting applications.
        NOAA requests an increase of $2.0 million for Spill Response and
    Habitat Restoration. This investment will develop and distribute tools
    and guidance to assist decision makers when releases of contaminants
    occur within the Marine Transportation System and other coastal
    environments. These funds will enable NOAA to more accurately evaluate
    the effectiveness of spill response measures, leading to improved
    response techniques as well as better methods of restoring injured
    resources.
        The total request of $9.5 million for the FAIRWEATHER repair and
    activation represents an increase of $2.7 million above the fiscal year
    2001 enacted level. This continued investment will complete the
    refurbishment and reactivation of the FAIRWEATHER and help reduce the
    survey backlog, a high marine transportation priority. This project was
    directed by Congress in 2001 and makes efficient use of this vessel
    which has been located at NOAA's Pacific Marine Center. With its home
    port in Alaska, the FAIRWEATHER will provide a platform that will help
    reduce the critical hydrographic survey backlog.
                Other Key NOAA Programs
        The total request of $14.0 million for Ocean Exploration represents
    an increase of $10.0 million above the fiscal year 2001 enacted level.
    Despite covering 70 percent of Earth's surface, the oceans remain
    largely unexplored and unknown. Not surprisingly, most of the oceans'
    resources remain untapped. Our best scientists believe that fewer than
    25 percent of the species that live in the oceans have ever been
    identified. Even within America's own Exclusive Economic Zone (EEZ),
    less than five percent of the ocean floor has been mapped in high
    resolution. In fact, prior to fiscal year 2001, the United States did
    not even have a concentrated program of ocean exploration. As a result,
    NOAA has pursued a course of ocean resource management without adequate
    decision-making data and information being available to policy makers,
    regulators, and commercial users of the ocean's resources.
        However, today we live in an age of technological innovation. There
    are many opportunities that simply were not available in earlier
    decades. We now can completely rethink how we might conduct exploration
    in Earth's oceans. Developments in sensors, telemetry, power sources,
    microcomputers, and materials science have greatly improved our ability
    to go into and study the undersea frontier.
        The benefits of such a program of exploration are potentially
    enormous. For example, gas hydrates comprise more than 50 percent of
    all of our planet's carbon--and potentially hold more than 1,000 times
    the fuel in all other estimated reserves combined! In addition, there
    are certain to be other benefits which currently are beyond our ability
    even to conceive. With 95 percent of the underwater world still unknown
    and unseen, what remains to be explored may hold clues to the origins
    of life on earth, cures for human diseases, answers to how to achieve
    sustainable use of our oceans, links to our maritime history, and
    information to protect the endangered species of the sea.
        We are stewards of our oceans' resources. We need to explore and
    know more about our oceans if we are to effectively manage them. We
    need to explore the oceans in the same way that the United States has
    successfully explored space. We need to determine what our marine
    resources are, their relative abundance, and the rates at which they
    can be used and replenished. Accurate knowledge of the oceans is
    essential for environmental, economic, and national security.
        The fiscal year 2002 budget increase will enable NOAA to fund six
    major and several minor interdisciplinary voyages of discovery that
    will map the physical, geological, biological, chemical, and
    archaeological aspects of parts of the U.S. EEZ. NOAA will conduct
    missions of exploration in the Gulf of Mexico, South Atlantic Bight,
    Northwest Hawaiian Islands, Northeast Pacific, California, and the Gulf
    of Alaska. Education and outreach is a major component of NOAA's Ocean
    Exploration Initiative. NOAA will carry-out this program relying on
    partnerships with universities, the private sector, and other agencies.
    NOAA's Ocean Exploration Initiative will help us to fulfill our
    national strategic goals to Sustain Healthy Coasts, Recover Protected
    Species, and Build Sustainable Fisheries.
                Marine Environmental Research ($11.6 million)
        The total request of $11.6 million for Marine Environmental
    Research represents an increase of $1.8 million above the fiscal year
    2001 enacted level. This continued investment will support ongoing
    operations at OAR's Atlantic Oceanographic Meteorological Laboratory
    (AOML) and the Pacific Marine Environmental Laboratory (PMEL). The
    requested funds will enable AOML's Remote Sensing Division to
    reactivate its field measurements that provide data for major community
    health-related decisions in contaminant-release emergencies in Florida
    and elsewhere. Coral reef monitoring activities are also supported.
    These funds will also enable PMEL's Fisheries Oceanography program to
    continue ocean measurements planned for the Gulf of Alaska and the
    Bering Sea. These funds are important to the study of the potential
    influences of climate changes on recent shifts in the species
    composition of these ecosystems including declines in salmon and
    steller sea lion populations.
        NOAA requests a total of $2.0 million for the Estuary Restoration
    Act. This investment will allow for NOAA-wide activities mandated by
    the Estuary Restoration Act of 2000. NOAA will work with other partners
    to implement a national estuary habitat restoration strategy designed
    to ensure a comprehensive approach towards habitat restoration
    projects. Healthy estuarine ecosystems provide a number of benefits
    pertaining to wildlife habitat, commercial and recreational fisheries,
    water quality, flood control, erosion, and outdoor recreation. NOAA's
    activities include the development of scientifically sound monitoring
    protocols and standards for coastal habitat restoration projects
    throughout the United States and its protectorates. NOAA will develop
    restoration databases that provide quick and easy access to accurate
    and up to date information regarding all projects funded under the
    Estuary Restoration Act of 2000. This work will provide scientists and
    resource mangers with information critical to successful estuary
    habitat restoration efforts.
        NOAA requests a total of $19.8 million for the Commerce
    Administrative Management System (CAMS). This investment will allow for
    the full benefit and value of CAMS to be realized in NOAA. CAMS is in
    the final stages of completion, expected in fiscal year 2003, and
    adequate funding will ensure that CAMS is deployed in a timely manner,
    allowing all modules to progress toward completion. Once fully
    deployed, CAMS will contribute in significant ways to maintaining a
    clean NOAA financial audit through systematic controls rather than
    through labor-intensive manual efforts. It will provide managers with
    on-line, real-time, and accurate financial information in support of
    their programmatic missions, and will be legally compliant. Requested
    funding for CAMS is vital to preserve NOAA's ability to have a
    satisfactory financial accounts system and allow NOAA and DOC to meet
    statutory obligations under the Federal Managers' Financial Integrity
    Act (FMFIA) and the Chief Financial Officer Act (CFO Act).
        The total request of $63.8 million for Marine Services represents
    an increase of $1.9 million above the fiscal year 2001 enacted level.
    This continued investment will allow NOAA to operate its fleet of 15
    vessels capable of safely collecting hydrographic and coastal
    assessment data, conducting fishery independent scientific and survey
    operations, and conducting sustained oceanographic and atmospheric data
    collection in various marine environments and provides funds for
    outsourcing to meet some data-collection requirements. The request
    includes an increase of $1.0 million to provide days-at-sea, primarily
    through University-National Oceanographic Laboratory System (UNOLS) and
    charter vessels, to support research in the Gulf of Mexico concerning
    the interactions of the Mississippi River plume, nutrient loading, and
    resulting effects of hypoxia on Gulf fisheries. These funds will also
    maintain or increase day-at-sea levels supporting other NOAA programs,
    including the science programs in NOS and the sanctuary program. The
    request also includes an increase of $0.9 million which will be used to
    pay the increased costs for operating the ADVENTUROUS' and to add days-
    at-sea on fisheries research vessels. The ADVENTUROUS, which will
    replace the TOWNSEND CROMWELL, is a larger and more capable vessel that
    will carry more scientists and complete more research on a daily basis.
                NOAA's Budget and Financial Management
        For the fiscal year 2000, NOAA received an unqualified opinion on
    NOAA financial statements from an independent auditor. The fiscal year
    2000 audit represents the second consecutive year NOAA has received a
    clean audit and demonstrates the intensive efforts made by NOAA to
    improve financial management. NOAA continues to place a high priority
    on improving fiscal and financial management in order to increase
    accountability and efficiency.
        Over the past several years, NOAA has been working to respond to
    Congressional concerns stemming from the NOAA budget structure. The
    Congressional Appropriation Committees have challenged NOAA to make
    recommendations to simplify its budget structure. NOAA has taken
    several actions that address the restructuring of its budget and
    financial management processes. The outcome of these actions is already
    apparent and demonstrated in its improved budgetary communications as
    well as in the improved accuracy of its documentation (e.g., sustaining
    a clean audit and improved timeliness in the distribution of funds).
    NOAA continues to work toward meeting the challenges of restructuring
    the NOAA budget and is excited about the improved efficiency a new
    budget structure will bring.
        As evidenced by NOAA's improving financial and budgetary
    management, NOAA is doing its part to exercise fiscal responsibility as
    stewards of the Nation's trust as well as America's coastal and ocean
    resources. And, in the same way that NOAA is responsible for assessing
    the Nation's climate, we are responsible for assessing our management
    capabilities. It is within this broader management context that NOAA
    continues looking for opportunities to improve. As in past years,
    NOAA's fiscal year 2002 Budget Request includes measures which track
    results to the level of public investment. NOAA will continue to
    leverage its programs and investments by developing those associations
    that most efficiently and economically leverage resources and talent,
    and that most effectively provide the means for successfully meeting
    mission requirements.

        Senator Gregg. Thank you for that comprehensive
    presentation on what NOAA is up to these days and where the
    money is going. I appreciate it.
        Senator Inouye was here before anybody else, including
    myself, so I will turn to him first.
        Senator Inouye. Thank you very much, Mr. Chairman.
        I wanted to come by today because Hawaii in a real sense is
    the NOAA State. I wanted to come by to thank you, Mr. Gudes,
    for all that you have done for us and continue to do so.
        Mr. Chairman, if I may, I have just one question, and I
    would like to submit the rest.
        Senator Gregg. As you wish.

                      jurisdictional authority of interior

        Senator Inouye. Mr. Gudes, we have had an ongoing problem
    with Interior as to who has jurisdiction over 3 miles from
    shore. What is the present situation? I know that the legal
    counsel of Justice issued an opinion which called into question
    Interior's authority, but we gather that Interior continues to
    exert management authority over marine resources.
        Mr. Gudes. Are you talking about specifically in the
    Northwest Hawaiian Islands, Senator?
        Senator Inouye. Yes.
        Mr. Gudes. In the Northwest Hawaiian Islands, I thought
    that basically had been settled at the end of last year, partly
    through the legislation that you put forward in terms of the
    marine sanctuary authorization as well as the former
    President's Executive order on the Northwest Hawaiian Islands.
        We do work closely with Interior in a number of areas. They
    do run National Parks which have coral reefs; we work on coral
    reefs. But in the case of the Northwest Hawaiian Islands, the
    land site, if you will, is a national refuge, and after 3 miles
    is the Northwest Hawaiian Islands--I guess currently, a ``coral
    reef preserve'' is the right term--with legislation telling us
    to move and hold public hearings toward becoming a marine
    sanctuary.
        Senator Inouye. As you know, Palmyra is an important
    addition. At the present time, we have been advised that
    Interior is exerting strong influence and jurisdiction over the
    resources of Palmyra. Is that true?
        Mr. Gudes. In the case of Palmyra, I think they actually
    were given jurisdiction under the previous administration--it
    is south, as I understand it, not in the Northwest Hawaiian
    Islands. In the case of Palmyra, I think they did. In the case
    of the Virgin Islands, they have jurisdiction over the undersea
    national parks. In American Samoa, actually, which you are very
    familiar with, we have a marine sanctuary, and they actually
    have a new national park. Both of us are very interested in
    preserving corals. We are working very hard in terms of corals,
    as you know and your staff knows. I think about 70 percent of
    the funding that this committee gave us for corals is going to
    the Pacific, and the Northwest Hawaiian Islands is a major area
    that we are focusing on.

                           fisheries lab construction

        Senator Inouye. Can you tell us about the status of the
    fisheries lab construction?
        Mr. Gudes. Yes. This committee has actually previously
    given us appropriations over some number of years for I want to
    say about $4.5 million or so. This year's budget request is $3
    million for the Honolulu laboratory. In total, we are going to
    need about another $34 million to finally build that lab to the
    specifications that we have, the design that we have.
        I think it is very significant, because we have been trying
    for some number of years to get funding in the President's
    request up to you, and to move ahead and get that lab built.
        Senator Inouye. Thank you very much.
        Thank you, Mr. Chairman.
        Senator Gregg. Over what period are you going to need that
    $34 million?
        Mr. Gudes. We will be back going into the 2003 process and
    probably the 2004 process, realistically, the way most NOAA
    construction projects have worked over time. Chairman Stevens
    has just come in--the Juneau laboratory, for example, has
    really started, I think, around 1991 in a similar fashion where
    Senator Stevens had some money put in, and it was not--really,
    last year was the first time we got a President's request for
    $1 million, and this year, we have over $11 million. So it will
    probably take some number of years.
        Senator Gregg. As is the tradition in this committee, when
    the chairman of the full committee arrives, we recognize him.
        Senator Stevens. Thank you very much for the courtesy. I
    have visited three other committees so far this morning, and
    this is where I am going to sit for a while, so I will wait my
    turn.
        Thank you.
        Senator Gregg. Senator Hollings.

                       hurricane tracking and forecasting

        Senator Hollings. First, that is about as good a
    presentation as I have heard since I have been here over
    several years, and I commend you for it.
        I am still hung up on Hurricane Mitch. What caused
    Hurricane Mitch to turn tail and start back inland in an
    opposite direction? You say we have got to do some more
    studying. From the studies on air currents and hurricanes, what
    causes that?
        Mr. Gudes. Senator, there are a number of factors that
    affect where a hurricane will steer, where it will go. A lot of
    it has to do with the boundary conditions, the area where the
    hurricane is moving into. A lot of it has to do with water
    temperature; when the sea surface temperature gets over 80
    degrees, it is a much higher probability of feeding the energy;
    a hurricane has an energy engine.
        In the case of a number of hurricanes, it has to do with
    other meteorological conditions. For example, when we see a lot
    of these hurricanes come up the East Coast, and then they turn
    out, it is often because we have some frontal action that takes
    place that is a blocking motion toward that hurricane, and as
    it goes into colder water, it tends to lose energy.
        In the case of Mitch--Jack or Louisa--do we know why it
    went south the way it did? I will have Jack Kelly respond, who
    is head of the Weather Service.
        Mr. Kelly. There a host of factors, as Scott explained,
    that influence where a hurricane goes. With Mitch, you had a
    stronger weather system to the north, which prevented it from
    going in the direction everyone anticipated it to go, so it got
    pushed south. Everyone thought that that would not materialize
    as strongly as it did, and the storm would have gone to the
    north. So you just had a stronger air mass to the north, and it
    shifted to the south and then went stationary.
        What really caused the damage in Central America was not so
    much the winds with that storm but the fact that it went
    stationary and rained for 3 or 4 days and dumped tens of inches
    of rain per day over the mountainous areas.
        Senator Hollings. But there is really no inadequacy of our
    hurricane studies. I mean, we have the plane up there and so
    on, right in the middle of it.
        Mr. Kelly. No, Senator. What it is is an inadequacy of our
    understanding of how the atmosphere unfolds many days in
    advance. In spite of all the progress that we have made, we
    really do not have perfect knowledge on how the atmosphere will
    respond, and we make mistakes on forecasts.
        Senator Hollings. But there is nothing money-wise that we
    can do to improve it, is there?
        Mr. Kelly. The U.S. Weather Research Program will have the
    universities try to understand better how the atmosphere
    unfolds, and in terms of that, yes, we can do that. In terms of
    satellites and aircraft to monitor what is happening, we have
    enough satellites and enough aircraft. The question is how will
    the atmosphere unfold in the next 24 to 48 hours, and we do not
    know that with perfect certainty.
        Senator Hollings. Thank you.
        I like your presentation on the satellites. We both
    remember Bernard Schwartz from Loral coming in and saving that
    contract from Ford, and on time and under cost, getting that
    geostationary satellite up first.

                            steller sea lion issues

        Let me ask a question now that both sides are represented
    here. Some kind of sea lion ruling held up the budget, the
    appropriations process, the Congress, and the Government until
    December because of Fisheries not taking a position, or a
    ruling or whatever. All that I remember is that you said, or
    somebody over in NOAA said that we ought to get in there
    earlier and get the information out or make the decision early
    so the same issue will not get into one of those political
    snarls.
        Have you corrected that?
        Mr. Gudes. I am watching Senator Stevens as I answer this.
        Senator Hollings. And look at Senator Murray, too--oh, she
    has gone.
        Mr. Gudes. The Steller sea lion issue took place over some
    period of time. It was not just last year--it probably started
    in the early 1990's with closed areas starting and some people
    arguing that we had not done enough to space out the fishing
    pressure and the sea lions.
        Definitely since the biological opinion and since the judge
    allowed us to proceed with fishing again, we have been working
    very hard with the North Pacific Fisheries Management Council
    in Anchorage, to try to find every opportunity that we can to
    be sensitive to the impact on fishermen, to allow the maximum
    amount of fishing that we can in a way that still protects the
    sea lions. We are still under the Endangered Species Act, we
    still have a finding of jeopardy, we are still working with the
    courts, and we still have to find a way to work to protect
    those sea lions. Their populations have been declining. So we
    are trying every opportunity that we can.
        We had an emergency rule that allowed jig and line fishing
    to take place there. We have been doing some satellite tagging
    to take a look at how far the sea lions go from the rookery
    areas. Actually, we are finding that a lot of them actually go
    about 10 miles out rather than 20 miles, and we are working
    with the Council on that issue.
        Then, finally, often we talk about science and data, and
    this committee and this Congress came forward and gave us $43
    million last year to start putting together the best science to
    deal with this issue, and we have been doing that--Bill Hogarth
    and the people at Fisheries and Jim Balsinger and the people up
    in Alaska have been doing everything they can to try to get
    this research and this effort going expeditiously to really try
    to solve this problem.
        We are extremely sensitive and extremely knowledgeable of
    the economic impact that it has had and the impact that it has
    had on Alaska, and we are trying everything we can to work with
    them.

                           hollings marine laboratory

        Senator Hollings. Very good. Let me make the record on the
    marine science center that is just opening up down at Fort
    Johnson. This is the most modern, updated marine scientific
    research center tied in with medical research. At that site, we
    also have the agricultural research center, which is the most
    modern and updated one of the Federal Government.
        Now, it has just come to my attention that the American
    Health Foundation along with Rockefeller University in New York
    City are interested in the study of proteomics. They tell me
    that with the human genome--and we can look at the morning news
    and hear about all the things being done with cancer--but that
    is for the study of human genes. They say the genes give a
    message to the proteins, and the proteins overlap, and if they
    overlap too fast, it is like stepping on the gas, or if they
    overlap too slow, it is like stepping on the brakes. But at the
    earliest stage, it can be studied and researched with what they
    call a geomagnetic resonance imager. There has got to be a
    follow-through to that marine science center working on
    medicine. If they can do that, Dr. Burley and others who have
    won Nobel Prizes up there in New York are convinced that we can
    get to the prevention of cancer, because at the early stage, it
    is very effective; down the road, the proteins have hundreds of
    thousands of mutations, and it is way too late. That is why we
    just treat it, treat it, and treat it all over the country. But
    this gene research is a thrust and endeavor to prevent it. The
    ``big blue'' IBM has promised free of cost to follow through
    with this and correlate all the information that we can get, so
    we are looking at that very closely.
        Mr. Gudes. Senator, I will just say that we are very
    excited about the Hollings Marine Laboratory at Fort Johnson. I
    totally agree with you that working with the Medical University
    of South Carolina, with the partners that we have there in the
    State of South Carolina--Margaret Davidson is here from the
    Ocean Service, which that lab comes under, and if there is
    anybody we have who really knows how to bring in different
    people into issues and really make a result that is bigger than
    the sum of the parts, it is Margaret. In terms of the marine
    sciences, there are any number of drugs that have been found by
    using marine organisms--that is part of what ocean exploration
    is about as well--and we are really excited about the
    laboratory there and the role it can play in NOAA and actually
    with the country.
        Senator Gregg. Thank you.
        Senator Stevens.
        Senator Stevens. Thank you very much.
        We welcome you as the spokesman for NOAA, Mr. Gudes. I want
    you to know that obviously, there is nothing personal in my
    comments.

                         findings on steller sea lions

        I would ask first, though, have your people been briefed by
    the North Pacific University's Marine Mammal Consortium on
    their findings regarding the Steller sea lion?
        Mr. Gudes. I believe so, Senator. Let me ask Dr. Hogarth,
    the head of Fisheries.
        Mr. Hogarth. Yes.
        Mr. Gudes. Yes, we have.
        Senator Stevens. You realize that they do not believe there
    is an endangered species there, that there is just one species.
    Your people singled out the eastern portion of the species to
    declare them under the Endangered Species Act.
        I urged the Secretary to be briefed by them. I wonder why
    we have ignored them. I also wonder why NOAA ignored its own
    study that showed that sea lions rarely go beyond 10 miles from
    a haul-out. In preparing your biological opinion, you set aside
    a basic finding of your own scientists--that sea lions rarely
    go beyond 10 miles--and required that we protect 20 miles from
    a haul-out. This has had a devastating effect on the fishery.
    The Coast Guard urged you not to do it for safety reasons, and
    your people rejected that.
        I wonder why we should wait for another study when you have
    ignored your own findings in the past. And you refused to
    accept the findings of the North Pacific University's Marine
    Mammal Consortium.
        We are going to be in for another battle, that is for sure,
    if NMFS now comes up with another unproven theory, ignores the
    Marine Mammal Protection Act, ignores the Magnuson-Stevens Act,
    and uses the Endangered Species Act to bring about a collision
    course with the State of Alaska over the most significant
    source of employment in our State, the fisheries from Kodiak to
    Atka. Then we are going to have another battle. I may lose, but
    I have got to tell you, it will be another battle.
        I do not understand why NOAA will not get with it and pay
    attention to its own studies.
        I am told that you are now on another course, having lost
    the round on the biological opinion. I am told that there is a
    draft Environmental Impact Statement using the same unproven
    theories to put another level of environmental attack on our
    commercial fisheries.
        Are we now facing a situation where the biological opinion
    is subject to an agency-generated Environmental Impact
    Statement, as required supposedly by the Endangered Species
    Act, when there is still no agreement that we are dealing with
    an endangered species?
        How far do I have to go. I am asking you, in order to keep
    my people at work? North Pacific University's Marine Mammal
    Consortium says that these mammals are not being depleted
    because the food chain is based upon pollock. It says that they
    are depleting for a whole series of reasons, and they believe
    that despite the depletion, they should not be listed as an
    endangered species.
        What do I have to do--ask the Commerce Committee to have a
    special hearing on this in order to expose this? How do I get
    some kind of response to the truth and to scientific fact in
    relation to pollock and the sea lion?
        Mr. Gudes. Mr. Chairman, I will ask Dr. Hogarth in a second
    if he would like to respond as well, but I would say that, as I
    often point out to NOAA employees, I am the one non-scientist
    in NOAA leadership, but I do get a chance to look at some of
    these issues and try to understand them in their entirety, and
    I think one of the problems that we have in Alaska--and I think
    the Steller sea lion is just one example--is conflicting
    messages on laws, on what we are required to do. And when we
    tend not to do what some people believe we are tasked to do
    under the law, the courts move in, and they say, ``NOAA, we are
    going to take this authority away from you.'' And I think in
    part with Steller sea lions, that is part of what happened.
        A year ago, we had a situation where a Federal judge
    stepped in and shut down all the fisheries----
        Senator Stevens. Yes, but keep in mind--you prepared three
    biological opinions that the courts did not disturb. You
    changed the scientists and the lawyers involved, and you came
    up with a fourth and a fifth that the court would not accept.
        I do not understand how you could destroy your own
    credibility with the courts any more than you did in that
    process.
        But beyond that, how are you going to get your credibility
    back? The North Pacific Regional Council--and I believe it
    includes the top national marine fisheries scientists from
    Seattle--have agreed on a set of rules to protect the sea lions
    and still allow the fisheries to go forward.
        I am told that Washington people, particularly the lawyers,
    have said that that recommendation will not be followed, and it
    will not be defended in court.
        Now let me tell you a little story about Roosevelt. In
    World War II, when Roosevelt wanted to start the lend-lease
    program, he called in the Secretary of the Navy, and he said,
    ``Mr. Secretary, I want to start this program, and I want to
    let the British have some of our gear, but it is up to you to
    work this out. Now go and work out a program--we will call it
    lend-lease--so we can get this material to them so they can
    defend themselves.''
        The Secretary of Navy came back the day after that and
    said, ``Mr. President, I am sorry to tell you that my lawyers
    tell me that it is not possible.''
        The President said, ``Which lawyer?'' This is God's truth--
    he said it--``Which lawyer?''
        And he said, ``My chief counsel.''
        And the President said, ``Mr. Secretary, you go back to
    that legal group, and the first person you find who is a lawyer
    and who agrees with me is your new general counsel.''
        I would suggest to you that if you have some problem with
    your legal office that it be remedied. I was the chief counsel
    for the Department of the Interior, and I know that Government
    lawyers are bent upon finding a different client than the
    public at times. But these people had better not hold up a
    decision by the Regional Council's decision that is based upon
    science and supported by the North Pacific University's Marine
    Mammal Consortium and by your top scientists in the field.
    Lawyers are not going to deter us from seeing that that opinion
    is enforced.
        Mr. Hogarth, what are you going to do with it when it comes
    to Washington?
        Mr. Hogarth. Thank you.

                            eis on steller sea lions

        There are several things going on. Number one, the draft
    Environmental Impact Statement was required by the courts, and
    it is a draft.
        Senator Stevens. Wait a minute. The court that required the
    biological statement also required the Environmental Impact
    Statement? Under the same act?
        Mr. Hogarth. The courts required us to do a programmatic
    EIS to open the fishery. That is----
        Senator Stevens. Just a minute. Where were your lawyers?
    The Marine Mammal Protection Act protected the sea lions to
    start with. They should have defended on that basis. The
    Magnuson-Stevens Act protected those. Never before have we had
    an Environmental Impact Statement or a biological opinion on a
    marine mammal.
        Mr. Hogarth. Because if it was considered endangered, it
    was under the Endangered Species Act.
        Senator Stevens. That is strange. You began with three
    biological opinions that were accepted. You change the
    personnel. It is filed; you go to court and do not defend it,
    and the court says you are not properly defending it, go and
    write another one. You go back with a fifth one, and the court
    says it is still insufficient and puts into effect a moratorium
    that puts all my people out of work. Now, that is bad
    management and bad law.
        I want you to know that I am not going to give up on this.
    You are allowing the courts to make a decision affecting one
    species which destroys opportunities for commercial fishing and
    at the same time subjects you to further restrictions under the
    Endangered Species Act, and you are already subject to a third
    because you have to comply with the Magnuson-Stevens Act.
        I do not understand why you do not stand up and tell that
    court what the law is. The law is clear--Congress did not
    intend the Endangered Species Act to override the Magnuson-
    Stevens Act. Congress did not say that you had to have an
    Environmental Impact Statement every time you made a decision
    under the Magnuson-Stevens Act.
        These significant decisions are not yours to make. The
    decisions are made by the regional councils. The Secretary
    makes the decision that you might have to have an Environmental
    Impact Statement once in a while, but you as an agency do not
    because you do not have jurisdiction. The jurisdiction is with
    the regional council.
        Someone had better read the Magnuson-Stevens Act. Beyond
    that, did you know that the emergency provisions that you used
    were from the Magnuson-Stevens Act? There is no emergency
    provision in the Endangered Species Act. I do not know what
    kind of lawyers you have down there, but they did not study the
    law like I did. Somehow we have got to get control over this.
        Now, is it true that you are going to hold up fishing until
    you get the approval of the Environmental Impact Statement?
        Mr. Hogarth. No, sir. Right now, we have a group that was
    set up by the Council called the Reasonable and Prudent
    Alternative (RPA) Committee, to look at reasonable and prudent
    alternatives. They have made a recommendation to the Council,
    and the Council has made that recommendation to us. That is
    under review right now, and it looks very good. One thing we
    are looking at is in the Steller conservation area, we have
    always had some kind of limits, even back in 1998. They have
    removed all of those limits, so right now, we are looking to
    see if we should approve that. They will be in place for the
    second half of this year.
        I have set up a process so hopefully we will not go through
    another issue like we went through last fall. We have set up a
    process for any disagreements to be resolved, and if they
    cannot resolve them in the region, they will come to me with
    the options, and I will make the decision.
        We are going----
        Senator Stevens. Excuse me. I do not want to be offensive,
    but the Magnuson-Stevens Act gave the regional councils the
    right to make the decisions that you are making. The reasonable
    and prudent alternatives are decided by the regional council.
        Mr. Hogarth. That is correct.
        Senator Stevens. I understand you are now negotiating with
    the plaintiffs in a lawsuit what is a reasonable and prudent
    alternative.
        Mr. Hogarth. The plaintiffs are part of that committee. The
    Council put them on the committee. The plaintiffs have come
    forward and said that they may go forward and ask the judge for
    another injunction if we implement all this because they feel
    like they have deviated so far from the biological opinion.
        Senator Stevens. I hope they do, because we will then amend
    the Magnuson-Stevens Act for sure and take them out of it
    entirely. What is a group of plaintiffs in a lawsuit doing on a
    committee of the Magnuson-Stevens Act which deals with the
    regional council's activities?
        Mr. Hogarth. Because the Council felt it was better to have
    them part of the process than to have them taking potshots, I
    guess. So they are part of it, but they are one member out of
    11, if I am not mistaken.
        Senator Stevens. Well, I do not remember the good Lord
    inviting the Devil to the last supper, my friend.
        They have no business trying to decide the outcome of this
    by negotiation. We did not create regional councils for
    negotiation. We created them for decisionmaking. The courts
    have got to get out of the business of making those decisions,
    and you brought them into it by letting the Endangered Species
    Act be part of this process. It is not part of this process.
        Mr. Hogarth. If I can do anything about it, we are going to
    get them back out of it. I do not think the courts should make
    those decisions, either.
        There are several things that have happened that I think
    are very positive. There is some data from Sea Grant on the
    Steller sea lions and the use of rookeries and the haul-outs.
    There is some scat data and food habits and so on that shows
    very little reliance on pollock. There is also the telemetry
    data that we have done, which shows that about 92 percent of
    the adults go no further out than 10 miles, and 88 percent of
    the sub-adults do not go any further than 10 miles.
        Senator Stevens. You had that study even before you even
    made the last biological opinion.
        Mr. Hogarth. We have a lot more data now that has been
    utilized by this RPA Committee. We also will, in my opinion,
    reinitiate the consultation for the 2002 season, because I
    think there is so much more data that is available to look at,
    and that biological opinion needs to be reinitiated and
    revisited for the 2002 season. But for the second half of this
    year, there will be changes again made based on your rider and
    the additional data that we have. So there will be some changes
    the rest of this year.
        The only thing I can tell you is that things are being done
    differently than they were in the last go-around, and they will
    continue to be done differently. We are in constant contact
    with the Council and the region. There is a 4-hour conference
    to go over everything. We are having regular conversations. We
    have a different process set up so that we do not come to a
    stalemate. It is all transparent. We have never let a
    biological opinion be reviewed in draft form before; this one
    will be. I have released three biological opinions--the Hawaii
    long line was released as a draft; the Pellagic long line for
    the South Atlantic was released, and this one will be released
    in draft form to get input before it is finalized.
        Senator Stevens. We are going to have to go back, I am
    sure. My two colleagues are on the conference committee, as I
    am. The Marine Mammal Act was passed because Congress did not
    believe the Endangered Species Act applied to marine mammals.
    It was passed after the Endangered Species Act was in place.
    The Marine Mammal Act was the result of Congress' intention to
    protect marine mammals under that Act, and that was Muskie's
    Act.
        Somehow, we have got to get a sense of the history here and
    understand that the Endangered Species Act was not designed to
    protect marine mammals. It is not Congress' intention that it
    be so used. But no one in your department has ever argued that.
    Why did we need the Marine Mammal Protection Act if the
    Endangered Species Act, which was already in existence, was
    effective as far as marine mammals were concerned?
        We have to get to where we have management control under
    scientific principles. But what is happening is that more and
    more of these environmental litigation agencies are destroying
    your agency with litigation that is just too redundant.
        I have taken too much time, and I apologize, but somehow,
    this has got to come to a halt. We cannot afford it. My people
    are not that rich that they can keep going to court with your
    agency and these environmental organizations. They work on
    donated funds. They do not make enough money to do this, and
    they are being squashed out of this business because they
    cannot afford legal fees. Are you aware of this? They just
    cannot do it.
        Mr. Gudes. Can I respond?
        Senator Hollings. Yes, surely. Mr. Chairman, you are asking
    the gentleman to explain Congress, and even I cannot do that.
    But the record should show that I heard about this controversy,
    so I asked about this Mr. Bill Hogarth, and let the record show
    that they said he is a good man.
        Senator Stevens. I know he is.
        Senator Hollings. Yes, and he has withstood your wrath
    better than I can.
        Do you have any comment, Mr. Hogarth or Mr. Gudes? No
    kidding--it is a serious problem, and the Senator from Alaska
    is right on target about the seriatim of the enactments with
    respect to the Endangered Species Act and the Marine Mammal
    Protection Act. Our frustration is that you are disregarding
    the recent Act and the real controlling Act.

                              nmfs lawsuit backlog

        Mr. Gudes. I am not a lawyer, and I am talking to some of
    the authors of the Magnuson-Stevens Act, so I want to be
    careful. But I think the general issue that you have raised is
    much more than just Steller sea lions in Alaska. We have 110 or
    so lawsuits right now. It is not just from environmental
    groups, as you said, Senator. It is from both sides. When
    someone, even with something that has nothing to do with the
    Endangered Species Act, is not happy with the decision--
    sometimes it happens at the Council--they go to court. Often,
    when I go to these fisheries meetings with Bill, I feel as
    though I am in a law school class instead of talking about
    fisheries. Very often, we are talking about the Administrative
    Procedures Act, and when is this rule going to come forward,
    and Notice of Rulemaking.
        Senator Hollings. What can this subcommittee do to undo
    that logjam? I mean, having 110 lawsuits backed up--something
    is wrong there.
        Mr. Gudes. Well, some of it is probably more appropriate--
    although the three of you are on the Commerce, Science,
    Transportation Committee of the authorization committee--but it
    is a problem in terms of the laws and the conflicting laws and
    how the laws are being used.
        Senator Stevens. Well, could I make a suggestion? These
    decisions that are theoretically based on science should not be
    appealable to courts to be handled by a bunch of lawyers who do
    not understand. If there is going to be an appeal, it ought to
    be to a group of scientists.
        Mr. Gudes. Well, Bill just helped solve an issue on summer
    flounder by working with the States. We had a situation where
    we had two conflicting laws, but more important than that, we
    had two conflicting Federal judges, one of whom was saying one
    thing and one of whom, here in Washington, D.C. was saying
    something different.
        Senator Stevens. What they do, Scott, is they find a judge
    where they know what he is going to decide. I can tell you what
    the judge in Seattle is going to decide, or the one here, or
    the one down in San Francisco.
        Mr. Gudes. And Senator Hollings, part of what you did last
    year was give us funding through your leadership to try to
    respond to things like NEPA, to try to get some of our EISs
    updated. In the case of Steller sea lions, it was giving us the
    idea to do some of the research and get the data that we need
    to be able to determine--that is part of it, because sometimes
    when we lose in court, it is because we do not have good enough
    data. And this is not only Department of Commerce, this is
    Department of Justice; they are the ones who litigate for us in
    court. This is a bigger issue.
        To end, Mr. Chairman, I understand exactly everything that
    you have said and your passion about this issue. We are in a
    situation where, if we do not do things right, we will end up
    back in the court, right or wrong, with the judge shutting down
    the fishery again, and we do not want that to happen.
        Senator Stevens. You are right. As a matter of fact, let us
    get off fish and look at the airport and SeaTech. For 19 years,
    we have been waiting for that Seattle runway to be completed,
    and every time it is just about ready to go, there is another
    lawsuit and another review by some judge, and we are told to do
    something different.
        You are about to get in the same position, where every
    year, everything you do will be reviewed by some court, and a
    group of lawyers will tell you what to do, when you thought
    your decisions were based on scientific data.
        So I think we have got to find some way to make these
    decisions appealable to a group of scientists. Tell the courts
    they can only get involved if someone has violated the law.
    They are substituting their feelings--not even their judgment,
    but their feelings--about the science, rather than allowing our
    scientists to make the decisions and see if they were the right
    decisions. I think these cases should be appealable to a
    scientific process and not the legal process.
        Mr. Gudes. If I could, one final comment on what Bill
    mentioned. Secretary Evans very strongly said to both Bill and
    me that he wants an open process that brings in everyone who is
    affected, and Bill has really worked very hard on biological
    opinions, on EISs, as he referred to, to try to open up that
    process, to bring in stakeholders, to bring in the Fisheries
    Management Councils ahead of time.
        Senator Inouye talked to us about long line issues and
    biological opinion issues--very similar--Endangered Species Act
    issues, and in this case, sea turtle interactions. So it is not
    a Marine Mammal Protection Act, it is what you would argue is
    an Endangered Species Act issue. And Bill went out and met with
    the Fisheries Management Council and with all the commercial
    fishermen in the area, and at least opened up the process in a
    way that had not been done before. That did not mean that what
    finally came out of NOAA and Fisheries was what those fishermen
    wanted to see, but it was a much more open and transparent
    process, and that is what we are working toward.

               factor's contributing to steller sea lion decline

        Mr. Hogarth. I would just like to say one final thing, that
    we are doing two other things to take a look at this. We have
    reconstituted the Steller sea lion recovery team with new
    members, and it will get to work right away. We hope we have a
    good group there to take another look.
        Also, we have gone outside and gotten a group to look at
    how to integrate Marine Mammal, Magnuson-Stevens, and ESA,
    because as an agency, I do not think we have really integrated
    them as they should be, and that is what has caused many of the
    problems. We are supposed to have that report back by the first
    of June, and then we can move forward.
        Senator Stevens. I hope that you will show all of those
    people the videos of the killer whales and the young sea lions.
        Mr. Hogarth. That has been documented, too, yes, sir.
        Senator Stevens. And the picture of the stomach of the one
    that had 17 Steller sea lion tags in the stomach.
        The Endangered Species Act apparently does not deter killer
    whales, which are increasing in number and overwhelming in our
    area. And if you listen to the consortium people, they will
    tell you that it is a combination of factors that are leading
    to the decline of the Steller sea lion, and one of them is
    predation. We are not taking them; other mammals are taking
    them. So I do not think we should base a recovery for the sea
    lions entirely upon stopping man from harvesting pollock.
        Incidentally, your people also overlooked the fact that
    pollock as a biomass is about four times the size it was when
    we passed the Magnuson-Stevens Act.
        Mr. Hogarth. It was an all-time record last year, the
    biomass.
        Senator Stevens. So I do not understand anyone saying there
    is not enough pollock for sea lions. But the problem lies in
    where they are located and where the Steller sea lions are
    located. The fatty fish are no longer there. If you want to do
    anything for us, find some way to restore the fatty fish and
    the Steller sea lion will come back.
        Mr. Hogarth. Yes. I have to agree with that.
        Senator Stevens. Thank you.
        Senator Hollings [presiding]. Our distinguished chairman is
    momentarily on the floor with the education bill.
        Senator Inouye.
        Senator Inouye. I have no questions.
        Senator Hollings. Very good. And thank you, Senator
    Stevens.

                    critical backlog in hydrographic surveys

        With respect to the critical backlog in the surveys, Mr.
    Gudes, what are we doing there, with the marine transportation
    system?
        Mr. Gudes. I think the number is somewhere around 32,000
    nautical miles of critical backlog. Actually, the largest event
    of that is in Alaska, Senator Stevens' State.
        We are doing a number of things. One, we have about $20
    million in this budget for private contracting for hydrographic
    surveys. That is the first time that our budget actually has
    fully funded where Congress has been asking us to use more
    private sector. On the Gulf of Mexico, for example, we use all
    private sector ships.
        We are modernizing the FAIRWEATHER. This is a NOAA ship,
    the sister ship to the RAINIER, which has six launches and is
    very capable. This committee came forward and gave us funding
    last year, and our budget actually has the funding to complete
    the modernization of that ship. The sister ship, the RAINIER,
    which is currently operating off Alaska, is actually our most
    productive hydrographic ship and is very capable.
        This is an area that we are focused on more and more in
    trying to work down that backlog. I think we are working down
    about 4 percent per year. We would like to do better than that.
    It is a very important issue, and we are working in the most
    critical areas.

                           coastal storms initiative

        Senator Hollings. Under the funding for the modernization
    of the marine transportation system, you have a $3 million item
    there. Is that for the National Ocean Service, a pilot program
    there?
        Mr. Gudes. Yes, most of this comes under the National Ocean
    Service. Which specific program--the Coastal Storms?
        Senator Hollings. Yes. What are we getting there for that
    $3 million?
        Mr. Gudes. I think the $3 million that you are talking
    about is the Coastal Storms Initiative; is that correct?
        Senator Hollings. Right.
        Mr. Gudes. Coastal Storms is really taking a look at how
    much of the American population is moving to areas just like
    Isle of Palms, where we have more and more people living who
    are in danger of coastal storms, evacuation routes. It is about
    doing better bathymetric models, better slosh models, taking
    existing current meters and providing oceanographic and
    atmospheric sensors. It is really about taking a look at the
    whole system and doing a better job. It includes the Weather
    Service as well, working in hydrology and floods.
        The first prototype that is in this budget actually
    proposes an effort in northeastern Florida, Jacksonville and
    the St. John's River area.
        Senator Hollings. Let me ask one final question, because we
    have to move on to the Small Business Administration.

                      funding for pacific salmon recovery

        With respect to the Pacific salmon funding for coastal
    salmon, we had $100 million, and now it is $90 million. I was
    surprised that the Bush administration put that $90 million in,
    because there is some question that the money is all being used
    for Columbia River salmon, and they have the dams there, and it
    is not doing what was intended.
        What is your comment on that?
        Mr. Gudes. The Pacific Coastal Salmon program, habitat
    restoration program, is about $90 million. It is a high
    priority to us. It really is a grant to States to work on
    habitat with a memorandum of understanding----
        Senator Hollings. But can you enumerate for the committee
    any successes at all?
        Mr. Gudes. It is having an impact in States like
    Washington, where we really have good community-based efforts
    to restore watersheds, to bring back the salmon.
        I would say, Mr. Chairman, that primarily it is in coastal
    areas. When Congress created the first appropriation, it gave
    us funding for Columbia River tribes, Native American groups.
    There is an issue this year that is significant which has to do
    with the drought in the Northwest, and one of the issues is--I
    think the State of Washington is using some of those funds to
    buy water rights, because in the Columbia River, we are going
    to have a real problem where we are not going to be able to get
    salmon back down the river. So that is an issue up the Columbia
    River.
        There is a related program, as you know. We fund the
    Mitchell Act hatcheries on the Columbia River--I want to say
    $16 or $18 million--which NOAA has been responsible for since
    we were created as an agency.

                         additional committee questions

        Senator Hollings. The record will remain open for any
    further questions.
        The committee thanks you for your outstanding presentation.
    Thank you very much, Mr. Gudes.
        Mr. Gudes. Thank you, Senator. Thank you, Senator Inouye.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]
                   Questions Submitted by Senator Judd Gregg
                         weather buoys in the northeast
        Question. How many weather buoys currently cover the Northeast
    fishing grounds?
        Answer. NWS operates 11 marine buoys and Coastal Marine Automated
    Network Systems (C-MAN) in the Northeastern United States (ie. North of
    40 degrees). This includes 7 marine buoys and 4 C-MAN Stations. Canada
    also operates 8 marine buoys off the coast of Nova Scotia.
        Question. Are there any holes in the coverage?
        Answer. NOAA is aware of some recent concerns with buoy coverage
    from various marine associations. NOAA will review these issues and
    report back to the Committee as soon as possible.
        Question. Does NOAA own all of these buoys?
        Answer. Yes, the 11 marine buoys and C-MAN stations in the
    Northeastern United are base funded and owned by NOAA. Of note, NOAA
    currently operates a total of 136 buoys and C-MAN stations. This
    includes 108 base funded and 28 reimbursable stations.
        Question. What did the 1997 National Research Council Report say
    about the adequacy and priority for buoys in the Northeast?
        Answer. The 1998 NRC study recommended that a core network of buoy
    and C-MAN stations should be established and maintained. The report
    recommended the network should be based on NOAA's 1995 Marine
    Observation Plan (MAROB) which called for additional buoys. However,
    the NRC stated the exact number and placement of additional buoys
    should be determined through an objective assessment and numerical
    analysis. With regard to priorities, the NRC study stated ``where and
    how fast changes should be made were beyond the scope of the study''.
        Question. Is NOAA currently considering moving any of these buoys?
    If so, why?
        Answer. No, NOAA does not plan to move any of these buoys. NOAA has
    received a request from the Cape Cod Commercial Hook Fishermen's
    Association to move the Nantucket Marine Buoy (#44008). However, the
    current location is optimal for NWS mission needs and provides critical
    observations to other marine users in the area.
        Question. If coverage is inadequate for the fishing fleet, how many
    more buoys would be required to complete the coverage? Please provide a
    plan for complete buoy coverage.
        Answer. NOAA is aware of some recent concerns with buoy coverage
    from various marine associations. As indicated in the previous
    response, NOAA will review these issues and report back to the
    Committee as soon as possible.
        Question. How long would it take to bring these buoys online?
        Answer. NOAA would need to review the current situation and assess
    the need for additional buoys. The deployment schedule for a buoy
    varies from 1-2 years. The actual deployment time can depend on the
    type of buoy, availability of a Coast Guard ship to deliver the buoy,
    production capacity at the National Data Buoy Center, and marine
    weather in the deployment area.
                           nmfs cooperative research
        Question. I've noticed that your budget request for the National
    Marine Fisheries Service (NMFS) includes an increase for Cooperative
    Research. This idea shows great promise for the future of fisheries
    management, but only if your fisheries scientists and managers are
    equipped and willing to use the data that is being collected. Can you
    demonstrate that they are willing and equipped to do so?
        Answer. NOAA's fiscal year 2002 request includes $3.5 million for
    NMFS cooperative research implementation under the Northeast Fisheries
    Management Programs line item. These funds cover the NMFS costs
    associated with cooperative research in the Northeast, including
    specific research design, field scientific staff, data assimilation and
    analysis, program administration, and application of the research
    results to Council management issues. These NMFS cooperative research
    implementation funds complement our $16 million request for specific
    cooperative research activities to utilize the expertise and insights
    of fishers in research including resource survey design and
    interpretation. For the Northeast, this two-part request provides both
    the resources for NMFS and the industry to ensure future cooperative
    research programs are successful and provide needed data.
                               fisheries lawsuits
        Question. As you know, NMFS' untimely action in the Ninth Circuit
    Court last year resulted in a temporary shutdown of one four nation's
    biggest fisheries. A NEPA-related lawsuit could threaten the lobster
    fishery in New England. How do you intend to approach the backlog of
    litigation? What is your plan to avoid this kind of backlog in the
    future? How are you planning to reduce the agency's risk to litigation?
    What steps are you taking to ensure that the entire staff of the agency
    is not pulled into litigation, and away from the science and
    regulations that they are required to implement? Many of the lawsuits
    involve a debate about the science. How is NMFS evolving to ensure that
    it makes decisions based upon the most up-to-date and sound science?
    You have requested $8 million for NEPA in fiscal year 2002. How do you
    intend to spend these funds?
        Answer. NOAA is certainly concerned about NMFS' litigation load, as
    it has approximately doubled in the last five or six years. Some of
    this increase is inevitable. The more species or populations an agency
    lists under the Endangered Species Act, the more litigation will ensue.
    Another example is the Sustainable Fisheries Act, which in 1996
    increased NMFS' responsibilities to rebuild overfished fisheries,
    minimize bycatch, and protect essential fish habitat. Those who believe
    NMFS has gone too far in conserving fish stocks and habitat have sued
    the agency, and so have those who think NMFS has not done enough to
    protect fish stocks.
        NMFS may be able to avoid other lawsuits in the future if it can
    improve its compliance with procedural statutes such as the National
    Environmental Policy Act and the Regulatory Flexibility Act. We have
    new guidelines for complying with the Regulatory Flexibility Act, and
    recently received an honorable mention from the Small Business
    Administration for our improved performance under that statute. We have
    a task force working now, with assistance from a contractor, to
    identify ways to better manage our decision making process by
    incorporating all of these procedural requirements more efficiently. We
    expect to make improvements in our compliance with procedural statutes
    that will result in better decision making, as well as ameliorate our
    litigation problems. Where possible, we have tried to continue programs
    in addition to meeting the needs associated with the court cases.
    However, in many cases this has not been possible and ongoing programs
    have suffered as staff have had to work on issues associated with the
    cases.
        The $8 million appropriated in fiscal year 2001 will address two
    primary needs. First, there is an immediate need to update numerous
    Environmental Impact Statements (EISs) around the country. The short-
    term needs of the agency to comply with court ordered deadlines and
    reduce the overall vulnerability to NEPA-related lawsuits will be
    addressed by allocating $5.6 million among the regions to support the
    highest priority projects. Second, NMFS is in need of systemic change
    to address the demands of NEPA on a continuing basis. We have
    established a task force and contracted for a study to aggressively
    review the agency's decision making process and compliance with all
    applicable law including NEPA.
        The $8 million continued in the fiscal year 2002 budget will be
    used to build on the task force recommendations and institute a
    management process that improves the decision making and integration of
    the agency's growing statutory, regulatory, and legal requirements.
    Additionally, the fiscal year 2002 budget request includes several
    items that will improve the agency's science. For example, proposed
    funding of $13.3 million for additional stock assessments, and $1.4
    million for more socio-economic analysis. Support for these requests
    would provide better data for the management arena and help reduce
    future litigation regarding science.
                          headquarters office support
        Question. According to your budget request, it appears that there
    are 14 staff offices that report to you, is that true?
        Answer. Of the 14 functional activities shown on the organizational
    chart accompanying the budget request, only nine (9) may be
    appropriately described as staff offices reporting to the Under
    Secretary (e.g., Chief Scientist, Public and Constituent Affairs,
    Policy and Strategic Planning, Sustainable Development and
    Intergovernmental Affairs, Legislative Affairs, International Affairs,
    General Counsel, Military Affairs, and Federal Coordinator for
    Meteorology). The resources supporting the Federal Coordinator for
    Meteorology are requested to be transferred from the National Weather
    Service to the Under Secretary and Associate Offices in fiscal year
    2002.
        Program Coordination and Executive Secretariat are operationally
    integrated with the Office of the Deputy Under Secretary. The resources
    for the NOAA High Performance Computing Center are carried in NOAA's
    Office of Oceanic and Atmospheric Research.
        Finally, the Office of Finance and Administration and the Office of
    Marine and Aviation Operations are operational offices supporting the
    NOAA mission.
        Question. What is the mission of each of these offices?
        Answer. The Under Secretary for Oceans and Atmosphere and
    Administrator of NOAA formulates policies and programs for achieving
    the objectives of NOAA and has the authority for program execution. The
    Assistant Secretary for Oceans and Atmosphere and Deputy Administrator
    of NOAA assists the Under Secretary/Administrator in formulating
    policies and programs and directs their execution.
        The Deputy Under Secretary for Oceans and Atmosphere serves as a
    key advisor to the Under Secretary/Administrator and Assistant
    Secretary/Deputy Administrator on all program and policy issues and is
    responsible for ensuring the timely and effective implementation of
    NOAA policies and objectives; oversees the development of and recommend
    policies and programs to meet NOAA's objectives; coordinates the
    implementation of policies promulgated by the Under Secretary/
    Administrator and Assistant Secretary/Deputy Administrator; coordinates
    actions required of NOAA in response to Executive Branch policy
    decisions; develops, plans, and coordinates major program efforts; and
    exercises delegated authority in committing NOAA to courses of action;
    assists the Under Secretary/Administrator and Assistant Secretary/
    Deputy Administrator in the administration of programs and operations
    of NOAA; and represents NOAA in executive level liaison with other
    Federal agencies, the Congress, and private industry. The Executive
    Secretariat and the Program Coordination Office are part of the Deputy
    Under Secretary's office.
        The Chief Scientist of NOAA is the principal scientific advisor to
    the Under Secretary. The Chief Scientist is NOAA's principal
    spokesperson on scientific and technological issues, formulates and
    recommends scientific policy to the Under Secretary/Administrator, and
    provides guidance to NOAA Line and Program Offices on scientific and
    technological issues; is NOAA's primary point of contact with the
    National Science Foundation, the National Academy of Sciences, the
    National Academy of Engineering, and other national and international
    science and technology organizations; superintends a continual process
    of independent peer evaluation to determine the quality and relevance
    of NOAA's science and technology programs, products, services, and
    professional staff, and recommends where and how improvements should be
    made; ensures that all NOAA services are based on sound science, that
    NOAA research programs are designed to improve existing NOAA services
    or establish the basis for needed new services, and that NOAA's
    research laboratories are meeting the agency's mission goals; and
    fosters sound research strategies and scientific program development
    within NOAA to meet long-range societal needs and emerging scientific
    and technological opportunities.
        The Office of Public and Constituent Affairs provides advice and
    counsel to the Office of the Under Secretary, Assistant Administrators,
    Program and Staff Office Directors and their staffs on media and
    constituent relations. The Office of Public and Constituent Affairs:
    establishes policies for communicating NOAA's activities to the media,
    constituencies and other audiences both internally and externally;
    provides a wide range of services to the media including responding to
    all inquiries, planning and conducting press conferences and media
    briefings; provides services to the public and NOAA's constituencies
    including writing fact sheets and press releases, responding to
    inquiries, coordinating conferences, briefings and luncheons, and
    responding to other constituency needs; serves as NOAA's central focus
    for internal communications; work with public and private sector
    organizations for collaborative outreach projects, planning and
    conducting ceremonies; produces video news releases and slide shows,
    full-length videos or films, maintains libraries of existing NOAA
    photographs, slides, film, videos and television news footage; responds
    to all public mail with materials updated and maintained by the
    correspondence unit; and coordinates the office's activities with the
    Office of Public Affairs, Department of Commerce.
        The Office of Sustainable Development and Intergovernmental Affairs
    provides advice and counsel to the Office of the Under Secretary, and
    the Department of Commerce on matters dealing with sustainable
    development and intergovernmental affairs. The Office, through
    consultation within NOAA and with the Department of Commerce,
    identifies opportunities for the deployment of coordinated interagency/
    intergovernmental policy strategies which recognize the importance of
    linking economic and environmental goals; provides advice and
    assistance on intergovernmental issues affecting NOAA; facilitates new
    partnerships among governments, private industry, academic
    institutions, trade and professional associations to bring Federal,
    state, and local resources to bear on economic problems aggravated by
    conflicts over resource management and other issues; supports the
    Secretary of Commerce and Under Secretary/Administrator on policies to
    encourage positive relationships between economic growth and
    environmental protection; reviews proposed NOAA policies and programs
    to assess their impacts on state, local and regional governments;
    prepares reference documents, and coordinates studies and analyzes data
    that will be the basis for recommendations to NOAA management in its
    areas of responsibility.
        The Office of Policy and Strategic Planning provides advice and
    counsel to the Office of the Under Secretary to achieve NOAA's goals
    through policy development, planning, and monitoring of appropriate
    agency policies. The Office develops and evaluates in coordination with
    the Assistant Administrators, and Program and Staff Office Directors,
    policies, strategies, and long-range plans for new initiatives and
    modification of existing programs; conducts and coordinates planning
    research and program and economic evaluations to provide a rigorous
    analytical basis for identifying changing national needs in NOAA's
    mission areas, identifies strengths and weaknesses in NOAA's programs
    to respond to national needs, and designs new strategies and approaches
    to achieve NOAA's high priority mission objectives; updates, as
    appropriate, the NOAA Strategic Plan; coordinates all NOAA activities
    implementing the National Environmental Policy Act (NEPA) and ecology
    and environmental conservation matters; and serves as the focal point
    for the Department's NEPA compliance and implementation.
        The Office of Legislative Affairs coordinates all NOAA contacts
    with the Congress other than those relating to appropriations; and is
    responsible for the planning, direction, and coordination of
    legislative programs that are of immediate concern to the Office of the
    Under Secretary. The Office serves as the primary liaison for NOAA with
    the members and staff of the Congress; identifies and tracks all
    legislation of interest to NOAA, keeping the Assistant Administrators
    and Office of the Under Secretary informed; assists in the development
    of positions setting forth NOAA's views on the merits of proposed or
    pending legislation, receives requests for preparation of testimony
    before the Congress and coordinates responses to questions submitted
    for the record by members and staff; directs and coordinates NOAA
    cross-cutting and special interest congressional and legislative
    activities; provides leadership to improve communications and
    coordination among legislative activities within Line and Program
    Offices and provides oversight of those programs; and coordinates the
    Office's activities with the Office of Legislative and
    Intergovernmental Affairs, Department of Commerce.
        The Office of International Affairs, which includes the Deputy
    Assistant Secretary for International Affairs, is responsible for
    planning and coordinating NOAA's international programs and carries
    out, as directed by the Office of the Under Secretary, tasks of special
    interest related to international activities. The Deputy Assistant
    Secretary for International Affairs exercises a leadership role in
    establishing policies, guidelines, and procedures for NOAA's
    international programs, including the coordination of NOAA's major
    international activities including those programs that overlap
    Assistant Administrators' or Program Directors' interests or
    responsibilities; provides support for the development and coordination
    of NOAA's international policies regarding ``trade and environment''
    issues and the negotiation of trade agreements; coordinates NOAA's
    interactions on international issues with other Federal departments and
    agencies, as well as other bureaus within the Department of Commerce;
    develops Administration policy on international issues affecting NOAA;
    coordinates NOAA's participation in U.S. delegations to international
    fora; and participates in the negotiation of international agreements
    and appropriate representation of NOAA and the Department of Commerce
    at international fora on environmental issues.
        The Office of General Counsel assists the General Counsel of NOAA
    in carrying out his/her statutory functions established by
    Reorganization Plan No. 4 of 1970.
        The Office of Military Affairs facilitates coordination and joint
    planning with the military services and other Department of Defense
    (``DOD'') offices as required, on programs of mutual organizational
    interest.
        The Office of the Federal Coordinator for Meteorological Services
    and Supporting Research, more briefly known as the Office of the
    Federal Coordinator for Meteorology, is an interdepartmental office
    established to ensure the effective use of federal meteorological
    resources by leading the systematic coordination of operational weather
    requirements and services, and supporting research, among the federal
    agencies.
        Question. Are they in any way duplicative of each other or
    duplicative of similar offices within the NOAA Line Offices?
        Answer. Similar positions exist in the NOAA line offices, however,
    the work they complete is not duplicative. The staff supporting the
    Under Secretary and Associate Offices are responsible for producing
    NOAA-wide workproducts.
        Question. How many people, Full-Time Equivalents (FTEs), detailees,
    and contractors work in each of these offices? What is each office's
    budget level? Which accounts in NOAA's budget support these offices?
        Answer. See attached table entitled ``Resource Analysis for Under
    Secretary and Associate Offices''.

       RESOURCE ANALYSIS--UNDER SECRETARY AND ASSOCIATE OFFICES, MAY 2001
                              [Dollars in millions]
    ------------------------------------------------------------------------
                                                FTE     Detailees    Amount
    ------------------------------------------------------------------------
    USEC \1\...............................         12  .........       $3.2
    DUS \2\................................          8          8         .7
    Chief Scientist........................          5  .........         .6
    Public & Constituent Affairs...........         36          5        3.7
    Policy & Strategic Planning............         10  .........        1.2
    Sustainable Development &                       10  .........        1.2
     Intergovernmental Affairs.............
    Legislative Affairs....................         21  .........        2.0
    International Affairs..................          8  .........         .8
    General Counsel........................        129  .........       10.6
    Military Affairs \3\...................  .........  .........  .........
    Federal Coordinator for Meteorology \4\         11  .........         .8
                                            --------------------------------
          Subtotals \5\....................        250         13       24.9
        Detailees..........................         13  .........  .........
                                            --------------------------------
          Totals...........................        263  .........       24.9
    ------------------------------------------------------------------------
    \1\ Includes Offices of Assistant Secretary for Oceans & Atmosphere and
      Deputy Administrator. Also includes $1.7 million in GSA rent and
      utilities for all Under Secretary and Associate Offices with exception
      of Office of General Counsel and OFCM.
    \2\ Includes resources supporting Program Coordination Office (7
      detailees, 1 contractor) and Executive Secretariat (4 FTEs) which are
      operationally integrated with the office of Deputy Under Secretary. As
      of May 7, 2001, Office of Deputy Under Secretary was supplemented by
      one contractor position.
    \3\ Military Affairs is supported by non-NOAA detailees from Department
      of Defense.
    \4\ Resources shown above are as of May 2001. The fiscal year 2002
      budget request reflects the Congressionally-approved transfer of
      $1,059,000 and 12 FTE from the National Weather Service base to
      Corporate Services' base.
    \5\ Includes 10 Presidential Appointees and 6 Schedule ``C''
      appointments.

        Question. Which accounts in NOAA's budget support these offices?
        Answer.

                              [Dollars in millions]

                                                                      Amount
    Direct Appropriations.............................................  17.4
    Mgt Fund..........................................................   5.9
    Earnings..........................................................   1.6
                                                                      ______
          Total.......................................................  24.9

        Question. Is it your intention to continue to support all of these
    offices, or are there some offices which you intend to terminate?
        Answer. Yes, NOAA will continue to support all of these offices.
                       real facility and equipment needs
        Question. The Committee is concerned that NOAA continues to defer
    its real facility, construction, and equipment needs into the outyears,
    without regard for the costs associated with putting off critical
    repairs. In the fiscal year 2002 Budget request, NOAA is asking for $1
    million in the Construction Account for critical repairs to the
    Beaufort Laboratory. Will this funding be sufficient to address all of
    the Lab's critical infrastructure concerns?
        Answer. The $1 million for Beaufort Lab repair projects requested
    in fiscal year 2002 is not sufficient to complete all of the required
    repair and renovation work. These funds would allow NOAA to address the
    two highest priority repairs: major electrical repairs and the
    planning, design and construction of a sewage and water system hookup
    to the Town of Beaufort system to avoid potentially harmful releases
    into the environment from the antiquated septic system.
        Question. What level of funding is required to solve the Beaufort
    problem?
        Answer. An additional $2 million (total of $3 million) would be
    required to complete the full suite of identified repairs at the
    facility. These additional needs include: Replacement of obsolete
    modular space (mobile homes that house laboratory and office space);
    replacement of the fish sampling platform; upgrade of shop electrical
    equipment; renovation of the radiation building; replace multiple heat
    pumps and AC units; window replacement; damaged seawall replacement;
    final electrical system renovations; mechanical renovation in the Main
    lab; elevator replacement; repair/conversions of old, damaged turtle
    rearing pens; lighting efficiency upgrades; fire alarm system
    evaluation; and refurbish the coatings on salt water tanks.
        Question. If resources are available this year, could you use them
    to solve this problem?
        Answer. Yes, the required repairs at Beaufort could be completed
    with additional resources.
        Question. Please provide a prioritized list of all of NOAA's needed
    facilities upgrades.
        Answer. See attached list entitled ``NOAA Facilities Maintenance,
    Repair & Safety''.

                                                          NOAA FACILITIES MAINTENANCE, REPAIR & SAFETY
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                              Priority                                                                                             Remaining
       LO       State/Installation Name   ----------------                                  Project Description                                      Funds
                                            Rank     Cat                                                                                             Req'd
    --------------------------------------------------------------------------------------------------------------------------------------------------------
        NOS NC--Beaufort, NC, Lab           10   ......  Major Electrical Repairs (1,154 comb)................................................    $270,480
        NOS NC--Beaufort, NC, Lab           10   ......  Elect. upgrade--ADP Bldg, Satwater Tower, Dock.......................................  ..........
        NOS NC--Beaufort, NC, Lab           10   ......  Structural repairs...................................................................  ..........
        NOS NC--Beaufort, NC, Lab           10   ......  Repair bridge to Pivers Island.......................................................  ..........
        NWS HI--Ewa Beach, HI, Tsunami      10   ......  Electrical Distrib. System Repair....................................................  ..........
             Warning Ctr
       NMFS TX--Galveston, TX, Lab          10   ......  Complete rehab of lab--Phase III--Design.............................................     100,800
       NMFS TX--Galveston, TX, Lab          10   ......  Complete rehab of the laboratory--phase I............................................  ..........
       NMFS TX--Galveston, TX, Lab          10   ......  Complete rehab of lab--Phase II......................................................  ..........
       NMFS HI--Honolulu, HI, Lab           10   ......  Auto-fire alarm system (all bldgs)...................................................  ..........
       NMFS AK--Juneau, AK, AFSC            10   ......  Replacement and repair of dock.......................................................  ..........
             Subport
       NMFS AK--Juneau, AK, AFSC            10   ......  Replace subport floats (funded and in progress)......................................  ..........
             Subport
       NMFS AK--Juneau, AK, Auke Bay        10   ......  Design Spec. to Repair Subport Pier Facing...........................................  ..........
             Lab
       NMFS AK--Juneau, AK, Auke Bay        10   ......  Freight Elevator Elim.&Crane Install. (completed 1997)...............................  ..........
             Lab
       NMFS CA--La Jolla, CA, S.W.          10   ......  Replace light fixtures in basement aquarium..........................................  ..........
             Fisheries Science Ctr
       NMFS CA--La Jolla, CA, S.W.          10   ......  Further Planning studies for LaJolla Remed. Project..................................  ..........
             Fisheries Science Ctr
       NMFS AK--Little Port Walter, AK,     10   ......  Install fire suppress. systm kitchen (completed 1997)................................  ..........
             Lab
       NMFS FL--Miami, FL S.E.              10   ......  Structural analysis and repair--Main lab.............................................  ..........
             Fisheries Science Center
        OAR FL--Miami, FL, AOML             10   ......  Electrical Upgrade of Lab Building...................................................  ..........
       NMFS CT--Milford, CT, Lab            10   ......  Seawater tank supports...............................................................  ..........
       NMFS CT--Milford, CT, Lab            10   ......  Structural Investigations............................................................  ..........
        OAR MI--Muskegon, MI, GLERL Lab     10   ......  Erosion repair and control...........................................................  ..........
        OAR MI--Muskegon, MI, GLERL Lab     10   ......  Safety and security repairs--GERL....................................................  ..........
       NMFS RI--Narragansett, RI, Lab       10   ......  Construct chemical storage building..................................................  ..........
       NMFS RI--Narragansett, RI, Lab       10   ......  Facility Chiller Replacement.........................................................  ..........
       NMFS FL--Panama City, FL, Lab        10   ......  Replace HVAC--Study mold problem.....................................................     378,000
       NMFS MS--Pascagoula, MS, Lab         10   ......  Replace old dock bldg................................................................     728,000
       NMFS AK--Pribilof Islands, AK,       10   ......  St. Paul Catwalk repair..............................................................  ..........
             St. Paul Lab
       NMFS NJ--Sandy Hook Lab              10   ......  Travel for Construction Inspection...................................................  ..........
        OFA WA--Seattle, WA Western         10   ......  Fence repairs........................................................................      72,800
             Regional Ctr
       NMFS WA--Seattle, WA, NW             10   ......  Abate mold and install controls......................................................      95,200
             Fisheries Science Ctr,
             Montlake
       NMFS WA--Seattle, WA, NW             10   ......  East Building Ventilation system upgrade.............................................     896,000
             Fisheries Science Ctr,
             Montlake
        OFA WA--Seattle, WA, Western        10   ......  Emergency Repairs Child Care Center (80k-100k).......................................  ..........
             Regional Ctr
       NMFS CA--Tiburon, CA, Lab            10   ......  Structural integrity of Tiburon Physiology Bldg......................................  ..........
       NMFS MA--Woods Hole, MA, N.E.        10   ......  New Bulkhead.........................................................................  ..........
             Science Ctr & Lab
       NMFS MA--Woods Hole, MA, NE          10   ......  Construct chemical storage building..................................................  ..........
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE          10   ......  Install fueling and safety equipment.................................................  ..........
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE          10   ......  Upgrade laboratory electrical system.................................................  ..........
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE          10   ......  Replace sand filters--Aquarium.......................................................  ..........
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE          10   ......  Repair basement ceiling--Aquarium....................................................  ..........
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE          10   ......  New Warehouse @ Otis AFB (land/100k).................................................  ..........
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE          10   ......  Public Aquarium Electrical Panel Replacement.........................................  ..........
             Fisheries Science Center
       NMFS CT--Milford, CT, Lab             9   ......  Construct chemical storage building..................................................  ..........
        OAR AK--Barrow, AK, GMCC             9       A   General rehab 8 projects.............................................................  ..........
             Observatory
        NWS AK--Barrow, AK, WSO              9       A   City Water Line Connection--NWS FUNDED...............................................  ..........
        OAR AK--Barrow, AK,GMCC              9       A   New garage/Replace storage bldg......................................................  ..........
             Observatory
        NOS NC--Beaufort, NC, Lab            9       A   Replacement of fish sampling platform................................................      29,400
        NOS NC--Beaufort, NC, Lab            9       A   Construct Sanitary Sewer Collection System...........................................     823,200
        OAR CO--Boulder, CO, Table           9       A   New Roof Building I-10-C.............................................................  ..........
             Mountain Observatory
        NOS SC--Charleston, SC, Coastal      9       A   CSC Building #2 Fire Alarm...........................................................  ..........
             Services Center
        NWS HI--Ewa Beach, HI, Tsunami       9       A   Sanitary Sewer System................................................................  ..........
             Warning Ctr
        NWS HI--Ewa Beach, HI, Tsunami       9       A   Replace deteriorated water mains.....................................................  ..........
             Warning Ctr
        OAR CO--Fritz Peak, CO               9       A   Pave Loading Dock/Entranceway Steps..................................................  ..........
             Observatory
        OAR CO--Fritz Peak, CO               9       A   Install fire detection system........................................................  ..........
             Observatory
        OAR CO--Fritz Peak, CO               9       A   Peak Exterior Stairs.................................................................  ..........
             Observatory
        OAR CO--Fritz Peak, CO               9       A   Replace power receptacles............................................................  ..........
             Observatory
        OAR CO--Fritz Peak, CO               9       A   Main Lab: replace switchgear, elec. panls, etc.......................................  ..........
             Observatory
       NMFS OR--Hammond, OR, Pt. Adams       9       A   Mezzanie Structural Reinforcement....................................................  ..........
             Field Station
       NMFS AK--Juneau, AK, Auke Bay         9       A   Chemical Fume Hoods for Safety at Lab (10 hoods).....................................     140,000
             Lab
       NMFS AK--Juneau, AK, Auke Bay         9       A   ABL foundation leak repair (NMFS completed 1997).....................................  ..........
             Lab
        NOS HI--Kihei, HI Marine             9       A   Upgrade non-conforming electrical wiring.............................................  ..........
             Sanctuary
        NOS HI--Kihei, HI, Marine            9       A   Repair foundation columns of Main Building...........................................  ..........
             Santuary
        NOS HI--Kihei, HI, Marine            9       A   Main Building Roof Replacement.......................................................  ..........
             Santuary
        NOS HI--Kihei, HI, Marine            9       A   Visitors Activity Center Roof Repair.................................................  ..........
             Santuary
        NOS HI--Kihei, HI, Marine            9       A   Repair insect damaged beams & joists (Main Bldg.)....................................  ..........
             Santuary
       NMFS AK--Kodiak, AK, Gibson Cove      9       A   Rmvl of electrical safety hzrds in main bldg & pier..................................  ..........
       NMFS CA--La Jolla, CA, S.W.           9       A   Concrete stairway Concrete stairway repair...........................................  ..........
             Fisheries Science Ctr
       NMFS CA--La Jolla, CA, S.W.           9       A   Repair/replace concrete pad under water tower........................................  ..........
             Fisheries Science Ctr
       NMFS AK--Little Port Walter, AK,      9       A   White House masonry repairs & Weir Cabin Roof Replac.................................     560,000
             Lab
       NMFS AK--Little Port Walter, AK,      9       A   Panabode found; Weir warehse repairs (CIP funds).....................................  ..........
             Lab
       NMFS AK--Little Port Walter, AK,      9       A   Correct nonconforming hazardous electrical wiring....................................  ..........
             Lab
       NMFS AK--Little Port Walter, AK,      9       A   Replace power generator system (cip funds, almost compl).............................  ..........
             Lab
       NMFS AK--Little Port Walter, AK,      9       A   Install communications system (LO done)..............................................  ..........
             Lab
       NMFS AK--Little Port Walter, AK,      9       A   Install Automatic Fire Alarm/All Bldgs. (in progress)................................  ..........
             Lab
       NMFS AK--Little Port Walter, AK,      9       A   Weir Hoist-Rail support beam footbridge replacmt.....................................  ..........
             Lab
       NMFS AK--Little Port Walter, AK,      9       A   Replace unsafe fire escapes and structures...........................................  ..........
             Lab
        NWS Pac.Is--Majuro & other           9       A   Relocate hydrogen generators.........................................................  ..........
             Pacific WSOs; Marshall Is,
             Lihue, AmSamoa, Wake, WSOs
        OAR HI--Mauna Loa, HI, GMCC          9       A   Emergency Electrical Repairs.........................................................  ..........
             Observatory
       NMFS FL--Miami, FL S.E.               9       A   Ground electrical receptacles--Main Lab (Safety Funded)..............................  ..........
             Fisheries Science Center
       NMFS FL--Miami, FL S.E.               9       A   Life Safety Modifications--Annex (Safety Funded).....................................  ..........
             Fisheries Science Center
       NMFS FL--Miami, FL S.E.               9       A   Replace card reader system...........................................................  ..........
             Fisheries Science Center
       NMFS CT--Milford, CT, Lab             9       A   Masonary and concrete repairs........................................................      89,600
        OAR MI--Muskegon, MI, Fld Sta        9       A   Renovate Bldg. I.....................................................................     717,360
       NMFS RI--Narragansett, RI, Lab        9       A   Replace Trailers (see e071)..........................................................  ..........
       NMFS RI--Narragansett, RI, Lab        9       A   Fire Detection System for Trailers...................................................  ..........
       NMFS OR--Newport, OR, Lab             9       A   Exhaust fumehoods vertically from roof...............................................      11,200
       NMFS OR--Newport, OR, Lab             9       A   Improvement of facility fire protection sys. (done by LO)............................  ..........
       NMFS OR--Newport, OR, Lab             9       A   Fire Safety in Aquaculture Lab.......................................................  ..........
       OMAO VA--Norfolk, VA, Atlantic        9       A   Bulkhead Repairs.....................................................................  ..........
             Marine Center
       OMAO VA--Norfolk, VA, Atlantic        9       A   Dockside fire sup. sys. (study funded, sys. not needed)..............................  ..........
             Marine Center
       OMAO VA--Norfolk, VA, Atlantic        9       A   Patch Bulkhead.......................................................................  ..........
             Marine Center
        OAR TN--Oak Ridge, TN, AT&D Lab      9       A   Upgrade darkroom exhaust ventilation.................................................  ..........
        OAR TN--Oak Ridge, TN, AT&D Lab      9       A   Replace Walker Branch site bldgs.....................................................  ..........
        OAR TN--Oak Ridge, TN, AT&D Lab      9       A   Replace electrical wiring--main bldg.................................................  ..........
        OAR TN--Oak Ridge, TN, AT&D Lab      9       A   Flooring Reinforcements..............................................................  ..........
        OAR AmSam--Pago Pago, AmSamoa,       9       A   Construct concrete reinforced sampling bldg..........................................  ..........
             GMCC Observatory
        OAR AmSam--Pago Pago, AmSamoa,       9       A   Replace Stairway/Rehab. Generator Bldg...............................................  ..........
             GMCC Observatory
       NMFS FL--Panama City, FL, Lab         9       A   Investigate condition of piles.......................................................  ..........
       NMFS FL--Panama City, FL, Lab         9       A   Replace HVAC system..................................................................  ..........
       NMFS FL--Panama City, FL, Lab         9       A   Replace Boiler and controls..........................................................  ..........
        OAR CO--Platteville, CO              9       A   General bldg rehab. (incl. Fencing & ground impr.)...................................  ..........
       NMFS AK--Pribilof Islands, AK,        9       A   Sewage System Upgrade................................................................  ..........
             St. Paul Lab
        OAR NJ--Princeton, NJ, ERL           9       A   Masonry Repairs......................................................................     106,400
             Geophysys. Dynam. Lab
        OAR NJ--Princeton, NJ, ERL           9       A   Ceiling Asbestos Removal.............................................................   1,624,000
             Geophysys. Dynam. Lab
        OAR NJ--Princeton, NJ, ERL           9       A   Asbestos Removal Study...............................................................  ..........
             Geophysys. Dynam. Lab
       NMFS WA--Seattle, WA, NW              9       A   Demolish Pilot Plant.................................................................   1,008,000
             Fisheries Science Ctr,
             Montlake
        OFA MD--Silver Spring Metro          9       A   Plaza Tiles..........................................................................  ..........
             Center
        NWS     Various NWS Sites--60        9       A   Hydrogen valve repl:NWS FUNDED, DONE.................................................  ..........
                 WSOs
       NMFS MA--Woods Hole, MA, NE           9       A   Second Means Egress&Handicap Access--Aquarium........................................  ..........
             Fisheries Science Center
        NWS AmSam--American Samoa, Pago      9       B   Arch. Upgrade for WSO (delete--WSO to be replaced)...................................     336,000
             Pago WSO
        NOS CO--Boulder, CO, Table           9       B   General Building Rehab--F-6..........................................................      16,800
             Mountain Observatory
        OAR CO--Boulder, CO, Table           9       B   Renovate bldg E-12-B.................................................................      72,800
             Mountain Observatory
        OAR CO--Boulder, CO, Table           9       B   Renovate bldg I-10-C.................................................................     168,000
             Mountain Observatory
        NOS CO--Boulder, CO, Table           9       B   Resurface roof--F6 Lab...............................................................  ..........
             Mountain Observatory
        NOS CO--Boulder, CO, Table           9       B   Resurface driveway & parking lot.....................................................  ..........
             Mountain Observatory
        NOS SC--Charleston, SC, Coastal      9       B   CSC bulding #2 roof (funded by NOS)..................................................  ..........
             Services Center
        OAR CO--Erie, CO, Field Sta          9       B   Erie Facilities upgrade..............................................................      72,800
        NWS HI--Ewa Beach, HI, Tsunami       9       B   Roof replacement (NWS Funded)........................................................  ..........
             Warning Ctr
        OAR CO--Fritz Peak, CO               9       B   Cottage: repair/upgrade mech, elec. wins., doors, tiles; paint.......................      29,904
             Observatory
        OAR CO--Fritz Peak, CO               9       B   Renovate ceiling and lighting........................................................      77,280
             Observatory
        OAR CO--Fritz Peak, CO               9       B   Replace Cottage roof.................................................................  ..........
             Observatory
        OAR CO--Fritz Peak, CO               9       B   Replace HVAC & hot water system......................................................  ..........
             Observatory
        OAR CO--Fritz Peak, CO               9       B   Replace lightning protection.........................................................  ..........
             Observatory
        OAR CO--Fritz Peak, CO               9       B   Main Lab: replace exterior equipment elevator........................................  ..........
             Observatory
       NMFS TX--Galveston, TX, Lab           9       B   Variable speed drive pump............................................................      60,480
       NMFS TX--Galveston, TX, Lab           9       B   Replace Salt Water Tanks.............................................................      64,960
       NMFS TX--Galveston, TX, Lab           9       B   Variable air controls for the buildings 213 & 302....................................      67,200
       NMFS OR--Hammond, OR, Pt. Adams       9       B   Replace termite damaged wood storage building foundation.............................      33,600
             Field Station
       NMFS HI--Honolulu, HI, Lab            9       B   Central Air Conditioning.............................................................  ..........
       NMFS HI--Honolulu, HI, Lab            9       B   Electrical upgrade...................................................................  ..........
        NWS TX--Houston, TX, WSO             9       B   Complete--NWS FUNDED.................................................................  ..........
       NMFS AK--Juneau, AK, Auke Bay         9       B   Genetics lab foundation repair & reinforcement.......................................      95,200
             Lab
       NMFS AK--Juneau, AK, Auke Bay         9       B   Eng. Design for Repl. Water Line Auke Creek Hatchery.................................     448,000
             Lab
       NMFS AK--Kodiak, AK, Gibson Cove      9       B   Refurbish Sanitary Sewage Treatment Unit.............................................  ..........
       NMFS CA--La Jolla, CA, S.W.           9       B   Repair the deterioration of the exterior walkway edges...............................      50,400
             Fisheries Science Ctr
       NMFS CA--La Jolla, CA, S.W.           9       B   Boiler retubing and repair...........................................................  ..........
             Fisheries Science Ctr
       NMFS AK--Little Port Walter, AK,      9       B   General rehab--safety systems upgrade................................................  ..........
             Lab
        OAR FL--Miami, FL, AOML              9       B   Replacement of cooling tower.........................................................      29,344
        OAR FL--Miami, FL, AOML              9       B   Roof Replacement.....................................................................      56,168
        OAR FL--Miami, FL, AOML              9       B   Replacement of Existing York 250 Ton Cent. Liq. Chiller..............................     306,880
       NMFS CT--Milford, CT, Lab             9       B   Seawater Chiller (NMFS funded).......................................................  ..........
       NMFS RI--Narragansett, RI &           9       B   Replace Service Entrance Switchgear & Generators.....................................     240,800
             Milford, CN Labs
        NWS TN--Nashville, TN, Upper         9       B   Replace doors on upper air bldg......................................................  ..........
             Air Facility
        OAR TN--Oak Ridge, TN, AT&D Lab      9       B   New roof for modular office bldg.....................................................      56,000
        OAR TN--Oak Ridge, TN, AT&D Lab      9       B   Replace roofing--main bldg (funded by DOE)...........................................  ..........
        OAR TN--Oak Ridge, TN, AT&D Lab      9       B   Repl. Roof Ship./Rec. Bldg. (funded by OAR)..........................................  ..........
       NMFS CA--Pacific Grove, CA            9       B   Rehab of heating & ventilation system (LO done)......................................  ..........
       NMFS CA--Pacific Grove, CA            9       B   Roof Drain Repairs (completed by NMFS)...............................................  ..........
        OAR AmSam--Pago Pago, AmSamoa,       9       B   Restore solar power sys.; rehab main lab (w/o A&E, etc)..............................      61,600
             GMCC Observatory
        OAR AmSam--Pago Pago, AmSamoa,       9       B   Repair roof/water catchmain sys.; rehab main lab.....................................     168,000
             GMCC Observatory
        OAR AmSam--Pago Pago, AmSamoa,       9       B   Rehabilitate government house (Bldg. 2)..............................................     168,000
             GMCC Observatory
        OAR AmSam--Pago Pago, AmSamoa,       9       B   Rehabilitate Govt. Employee Housing (bldg. 1)........................................  ..........
             GMCC Observatory
        NWS AK--Palmer, AK, Tsunami          9       B   Basement water damage repairs (NWS Funded)...........................................  ..........
             Warning Ctr
       NMFS FL--Panama City, FL, Lab         9       B   Replace Overhead htrs................................................................       3,920
       NMFS FL--Panama City, FL, Lab         9       B   Upgrade Electrical system............................................................      11,200
       NMFS FL--Panama City, FL, Lab         9       B   Foundation erosion engineering evaluation............................................      22,400
       NMFS FL--Panama City, FL, Lab         9       B   Shoreline Stabilization..............................................................      22,400
       NMFS FL--Panama City, FL, Lab         9       B   Dock and bulkhead stability study....................................................      56,000
       NMFS FL--Panama City, FL, Lab         9       B   Engineering Evaluation...............................................................      64,960
       NMFS MS--Pascagoula, MS, Lab          9       B   Replace Chapman Warehouse............................................................     147,840
       NMFS MS--Pascagoula, MS, Lab          9       B   Replacement of Floor and Wall Coverings..............................................  ..........
       NMFS MS--Pascagoula, MS, Lab          9       B   HVAC repairs (funded 1997, not complete).............................................  ..........
        OAR CO--Platteville, CO              9       B   Remove Asbestos Floor Tile...........................................................  ..........
       NMFS AK--Pribilof Islands, AK,        9       B   Rehab of Garco Building--St.Paul.....................................................      84,000
             St. Paul Lab
        NWS AK--Pribilof Islands, AK,        9       B   Reroof Composite Building (NWS funded)...............................................  ..........
             St. Paul WSO
        OAR NJ--Princeton, NJ, ERL           9       B   Chiller #3 Replacement (funded by OAR)...............................................  ..........
             Geophysys. Dynam. Lab
        OAR NJ--Princeton, NJ, ERL           9       B   Chiller Plant Upgrade (funded by OAR)................................................  ..........
             Geophysys. Dynam. Lab
        OAR NJ--Princeton, NJ, ERL           9       B   Chiller Plant Upgrade Design.........................................................  ..........
             Geophysys. Dynam. Lab
       NMFS WA--Seattle, WA, NW              9       B   Fire alarm system--all buildings.....................................................  ..........
             Fisheries Science Ctr,
             Montlake
        OFA WA--Seattle, WA, Western         9       B   Roof replacement bldg 3, incl. canopy................................................     504,000
             Regional Ctr
        OFA WA--Seattle, WA, Western         9       B   Roof replacement bldg 4..............................................................     657,664
             Regional Ctr
        NWS OR--Sexton Summit, OR, WSO       9       B   Repair/replace water line to Weather Svc Station.....................................      67,200
        NWS LA--Slidell, LA, NEXRAD          9       B   Flood control dyke around NEXRAD (Funded by LO)......................................  ..........
        NWS AK--Barrow, AK, WSO              8       A   Upgrade heating systems (NWS Funded).................................................  ..........
        NWS     Eastern Region--10 WFOs      8       A   Install 10 fire detection and alarm systems..........................................     224,000
        OAR CO--Erie, CO, BAO                8       A   OAR Tower safety repairs & replacement...............................................      39,200
        OAR CO--Erie, CO, Observatory        8       A   BAO Trailer & Storage Space Upgrades.................................................      39,200
        OAR CO--Fritz Peak, CO               8       A   Install inter. stairs, firedr/wall, janit. closet (Desgn funded).....................      63,168
             Observatory
        OAR CO--Fritz Peak, CO               8       A   New Roof and Lighting--Main Lab Bldg.................................................      95,200
             Observatory
        OAR CO--Fritz Peak, CO               8       A   Cottage Site Grading/Drainage........................................................  ..........
             Observatory
        OAR CO--Fritz Peak, CO               8       A   Site grading, paving, install parking area...........................................  ..........
             Observatory
        OAR CO--Fritz Peak, CO               8       A   Flammable Liquid & Gas cylinder storage area.........................................  ..........
             Observatory
        OAR CO--Fritz Peak, CO               8       A   Bldg. & Site security system upg. DOC sy funded......................................  ..........
             Observatory
       NMFS TX--Galveston, TX, Lab           8       A   Bldg demolition--East Lagoon Bldg....................................................      91,840
       NMFS TX--Galveston, TX, Lab           8       A   Construct Boat Barn..................................................................     247,520
        NWS KS--Goodland, KS, WFO            8       A   Installation of LED Exit Lights......................................................       6,944
        NWS KS--Goodland, KS, WFO            8       A   Condensing Units Disconnect Switches.................................................      10,080
        NWS KS--Goodland, KS, WFO            8       A   Installation of Smoke Detectors (NWS Funded).........................................  ..........
       NMFS OR--Hammond, OR, Pt. Adams       8       A   Marina Shop Life Safety Upgrade......................................................      39,078
             Field Station
       NMFS OR--Hammond, OR, Pt. Adams       8       A   Fire/intrus. detect. & fire suppress. systm (Complete Secyfnds)......................  ..........
             Field Station
       NMFS OR--Hammond, OR, Pt. Adams       8       A   Remed. unprotect wiring/Marina Bldg (NMFS complete 1997).............................  ..........
             Field Station
       NMFS AK--Juneau, AK, AFSC             8       A   Crane for Subport Pier...............................................................     168,000
             Subport
       NMFS AK--Juneau, AK, Auke Bay         8       A   Replace gangway to the ABL Float with a new covered gangway..........................      85,120
             Lab
       NMFS AK--Juneau, AK, Auke Bay         8       A   Relocation of Sewage Pumping Tank & Pier Decking.....................................     112,000
             Lab
       NMFS AK--Juneau, AK, Auke Bay         8       A   Arrest earth movement in parking lot.................................................     224,000
             Lab
       NMFS AK--Kodiak, AK, Gibson Cove      8       A   Replace heating boiler (completed by LO).............................................  ..........
       NMFS AK--Kodiak, AK, Gibson Cove      8       A   Install fire detection & security alarm systems......................................  ..........
       NMFS CA--La Jolla, CA, S.W.           8       A   Replace space heaters w/HVAC sys. in Library.........................................      50,400
             Fisheries Science Ctr
       NMFS CA--La Jolla, CA, S.W.           8       A   Walkway Coating Repair (810 combined)................................................     448,000
             Fisheries Science Ctr
       NMFS CA--La Jolla, CA, S.W.           8       A   Upgrade exhausthoods & exhaust fans (NMFS completed 1997)............................  ..........
             Fisheries Science Ctr
       NMFS AK--Little Port Walter, AK,      8       A   Implement Safety Measues, Railings, Eyewash, etc.....................................  ..........
             Lab
       NMFS WA--Manchester, WA Field         8       A   Correct electrical safety issues.....................................................      11,200
             Station
       NMFS WA--Manchester, WA Field         8       A   Provide retaining wall outside bldg. 13..............................................      28,000
             Station
       NMFS WA--Manchester, WA Field         8       A   Electrical Upgrade and exterior lighting.............................................      42,000
             Station
       NMFS WA--Manchester, WA Field         8       A   Provide Adequate Lateral Bracing.....................................................      65,296
             Station
       NMFS WA--Manchester, WA Field         8       A   Install fire hydrant.................................................................      78,400
             Station
       NMFS WA--Manchester, WA Field         8       A   Dock/pile repair.....................................................................     103,712
             Station
       NMFS WA--Manchester, WA Field         8       A   Replace fume hoods (NMFS funded).....................................................  ..........
             Station
        NWS AK--McGrath, AK, WSO             8       A   Water treatment system (NWS Funded)..................................................  ..........
       NMFS FL--Miami, FL S.E.               8       A   Entrance modification................................................................  ..........
             Fisheries Science Center
        OAR FL--Miami, FL, AOML              8       A   Miscellaneous Electrical Repairs.....................................................      26,096
        OAR FL--Miami, FL, AOML              8       A   Structural Study of Concrete Decks...................................................      59,472
       NMFS OR--Newport, OR, Lab             8       A   Install mag. door rel.& close gapsfire doors (LO done)...............................  ..........
       OMAO VA--Norfolk, VA, Atlantic        8       A   Eng. Study on Bulkhead Replacement...................................................     106,400
             Marine Center
        OAR TN--Oak Ridge, TN, AT&D Lab      8       A   Structural investigation.............................................................  ..........
        NWS CA--Oakland, CA, Upper Air       8       A   Facility repairs.....................................................................      84,000
             Facility
       NMFS CA--Pacific Grove, CA            8       A   Upgrade Emergency lighting system....................................................       6,608
       NMFS FL--Panama City, FL Lab          8       A   Install carbon monoxide detector.....................................................       2,240
       NMFS FL--Panama City, FL, Lab         8       A   Fire alarm & lighting................................................................      49,616
        OFA WA--Seattle, WA Western          8       A   Master fire panel upgrade for WRC campus.............................................     112,000
             Regional Ctr
        OFA WA--Seattle, WA Western          8       A   Hangar door lead based paint abatement & repair, bldg 32 & 33........................     288,288
             Regional Ctr
        OFA WA--Seattle, WA Western          8       A   Structural renovation of pedestrian skybridges, Buildings 1, 3 & 4...................     338,240
             Regional Ctr
        OFA WA--Seattle, WA Western          8       A   Install bird netting as an emergency remedy to potential hlth. problem...............     370,048
             Regional Ctr
        OFA WA--Seattle, WA Western          8       A   Fire alarm panel replacement for buildings 3, 4 and 8................................     448,000
             Regional Ctr
       NMFS WA--Seattle, WA, NW              8       A   Install chemical lab fume hoods......................................................  ..........
             Fisheries Science Ctr,
             Montlake
        OFA WA--Seattle, WA, Western         8       A   Repair skybridges....................................................................     338,240
             Regional Ctr
        OFA WA--Seattle, WA, Western         8       A   Auto. Fire sprinkler System, Bldg. 8 ofc.............................................     118,720
             Regional Ctr
       NMFS CA--Tiburon, CA, Lab             8       A   Replace Lab Hoods (NMFS Funding).....................................................  ..........
        NWS AK--Valdez, AK, WSO              8       A   Safety hazard correction.............................................................  ..........
     NESDIS VA--Wallops Island, VA,          8       A   Hurricane shutters...................................................................     198,240
             Data Acquis. Station
     NESDIS VA--Wallops Island, VA,          8       A   Screen Walls.........................................................................     333,760
             Data Acquis. Station
     NESDIS VA--Wallops Island, VA,          8       A   Strengthen Ext. Walls................................................................     991,200
             Data Acquis. Station
        NOS NC--Beaufort, NC, Lab            8       B   Repl. of pkg.heat pump & AC unit--Larva Rearing Lab..................................       6,468
        NOS NC--Beaufort, NC, Lab            8       B   Repl. thru-wall heat pump in Ecology Wing Main Lab...................................      31,634
        NOS NC--Beaufort, NC, Lab            8       B   Upgrade shop electrical equipment....................................................      58,240
        NOS NC--Beaufort, NC, Lab            8       B   Renovation--Radiation Bldg. (Survey Prop. #6)........................................     109,015
        NWS NY--Buffalo, NY WFO              8       B   Replace upper air inflation building (UAIB)..........................................     196,000
        NWS     Eleven Sites                 8       B   UPS Replacements.....................................................................     616,000
        NWS HI--Ewa Beach, HI, Tsunami       8       B   Resurface asphalt roadways to PTWC...................................................     212,800
             Warning Ctr
        NWS HI--Ewa Beach, HI, Tsunami       8       B   Structural repair of residences damaged by ants......................................  ..........
             Warning Ctr
        NWS HI--Ewa Beach, HI, Tsunami       8       B   Replace concrete window sills........................................................  ..........
             Warning Ctr
     NESDIS AK--Fairbanks, AK, Gilmore       8       B   Paint 4 Exterior Buildings...........................................................      28,000
             Creek CDA Sta
     NESDIS AK--Fairbanks, AK, Gilmore       8       B   Road Pavement Repair (funded by LO)..................................................  ..........
             Creek CDA Sta
        OAR CO--Fritz Peak, CO               8       B   Upgrade electrical service...........................................................  ..........
             Observatory
       NMFS OR--Hammond, OR, Pt. Adams       8       B   Replace heating boiler in station main bldg..........................................      28,000
             Field Station
       NMFS OR--Hammond, OR, Pt. Adams       8       B   Repair Termite-damaged Foundation....................................................      58,430
             Field Station
       NMFS OR--Hammond, OR, Pt. Adams       8       B   Combine & upgrade elect. svcs on site (NMFS completed)...............................  ..........
             Field Station
       NMFS HI--Honolulu, HI, Lab            8       B   Main Building Roof...................................................................      32,032
       NMFS AK--Juneau, AK, Auke Bay         8       B   Structural repair of General Purpose Bldg. roof......................................     134,400
             Lab
       NMFS AK--Juneau, AK, Auke Bay         8       B   Hydronics System Repair to Main Bldg.................................................  ..........
             Lab
       NMFS AK--Juneau, AK, Auke Bay         8       B   Repair foundation, ABL Main Bldg (NMFS funded).......................................  ..........
             Lab
        NOS HI--Kihei, HI, Marine            8       B   Repair old Garage and construct Shed endwall (fund LO)...............................  ..........
             Santuary
       NMFS AK--Kodiak, AK, Gibson Cove      8       B   Repair timber/retain. walls/timber pier repair.......................................      89,600
       NMFS AK--Kodiak, AK, Gibson Cove      8       B   Replace bldg exterior closure (LO funded)............................................  ..........
       NMFS CA--La Jolla, CA, S.W.           8       B   Replace Seawater chiller sys., incl. cool tower & Pumps..............................     168,000
             Fisheries Science Ctr
       NMFS WA--Manchester, WA Field         8       B   Marine Net-pen System Repair.........................................................     196,000
             Station
        NWS AK--McGrath, AK, WSO             8       B   Correct heating problems (6 residences)..............................................     247,520
        NWS AK--McGrath, AK, WSO             8       B   Replace electrical panel, etc. (NWS Funded)..........................................  ..........
       NMFS FL--Miami, FL S.E.               8       B   Packaged Heat Pump Replacements......................................................      10,416
             Fisheries Science Center
       NMFS FL--Miami, FL S.E.               8       B   Replace Fresh-Air Unit...............................................................      22,400
             Fisheries Science Center
       NMFS FL--Miami, FL S.E.               8       B   Repair 2nd Flr interior walls of the east wing.......................................      33,600
             Fisheries Science Center
       NMFS FL--Miami, FL S.E.               8       B   Paint exterior of the buildings......................................................      89,600
             Fisheries Science Center
       NMFS FL--Miami, FL S.E.               8       B   Replace condensing unit--Main Lab....................................................  ..........
             Fisheries Science Center
        OAR FL--Miami, FL, AOML              8       B   Caulking AOML windows................................................................      11,200
        OAR FL--Miami, FL, AOML              8       B   Replace condensing unit--Lab Building................................................  ..........
        NWS TX--Midland/Odessa, TX,          8       B   Replace doors on upper air bldg (funded by NWS)......................................  ..........
             Upper Air Facility
       NMFS CT--Milford, CT, Lab             8       B   Building 1 HVAC Upgrades.............................................................     280,000
       NMFS CT--Milford, CT, Lab             8       B   Heat Exchangers (NMFS funded)........................................................  ..........
       NMFS RI--Narragansett, RI, Lab        8       B   Re-pave Entrance Road and Parking Lot................................................      61,600
       NMFS RI--Narragansett, RI, Lab        8       B   Replace HVAC System--Lab Building....................................................     168,000
       NMFS RI--Narragansett, RI, Lab        8       B   Replace Facility Office/Storage Bldg.................................................     196,000
       NMFS RI--Narragansett, RI, Lab        8       B   Replace Greenhouse (NMFS Funded).....................................................  ..........
       OMAO VA--Norfolk, VA, Atlantic        8       B   Replace Windows......................................................................      89,600
             Marine Center
       OMAO VA--Norfolk, VA, Atlantic        8       B   Replace HVAC Systems Building 1......................................................     476,000
             Marine Center
       OMAO VA--Norfolk, VA, Atlantic        8       B   Roof Replacement (funded by ONCO)....................................................  ..........
             Marine Center
        OAR TN--Oak Ridge, TN, AT&D Lab      8       B   New shipping/receiving and storage bldg..............................................     196,000
        OAR TN--Oak Ridge, TN, AT&D Lab      8       B   HVAC system replacement in main bldg (pd DOE)........................................  ..........
       NMFS CA--Pacific Grove, CA            8       B   Electrical repairs...................................................................      10,080
       NMFS CA--Pacific Grove, CA            8       B   Exterior concrete repairs and modification...........................................      33,600
       NMFS CA--Pacific Grove, CA            8       B   Reroofing............................................................................      39,200
       NMFS FL--Panama City, FL, Lab         8       B   Replace windows......................................................................       4,704
       NMFS FL--Panama City, FL, Lab         8       B   Replace Entrance doors...............................................................       8,400
       NMFS FL--Panama City, FL, Lab         8       B   Upgrade Lighting.....................................................................      11,200
       NMFS FL--Panama City, FL, Lab         8       B   Replace pilings......................................................................      11,984
       NMFS FL--Panama City, FL, Lab         8       B   Paint Buildings......................................................................      28,448
       NMFS FL--Panama City, FL, Lab         8       B   Replace roof system--main bldg.......................................................  ..........
       NMFS MS--Pascagoula, MS, Lab          8       B   Boiler and pump replacement..........................................................      33,891
        NWS PA--Pittsburgh, PA WFO           8       B   Overhaul PBZ UAIB....................................................................      72,800
        OAR CO--Platteville, CO              8       B   Electrical upgrade & repair..........................................................  ..........
       NMFS AK--Pribilof Islands, AK,        8       B   Rehab staff quarters--St. Paul.......................................................     308,000
             St. Paul Lab
        NWS AK--Pribilof Islands, AK,        8       B   Electric & furnace renovation (NWS Funded)...........................................  ..........
             St. Paul WSO
        NWS UT--Salt Lake Cty, UT,           8       B   Improve Access Road: NWS FUNDED......................................................  ..........
             Tremonton Radar Site
        OFA WA--Seattle, WA Western          8       B   Asphalt repairs and seal coating of parking lots at BLD 1, 3, 4 and road surfaces         149,539
             Regional Ctr                                 area.
        OFA WA--Seattle, WA Western          8       B   Replace (7 HVAC roof top units, Building 3)..........................................     802,576
             Regional Ctr
       NMFS WA--Seattle, WA, NW              8       B   Electrical upgrade--West bldg........................................................      63,028
             Fisheries Science Ctr,
             Montlake
       NMFS WA--Seattle, WA, NW              8       B   Ceiling grid system and tiles East building..........................................     168,000
             Fisheries Science Ctr,
             Montlake
       NMFS WA--Seattle, WA, NW              8       B   Replace boiler in east building......................................................     224,000
             Fisheries Science Ctr,
             Montlake
       NMFS WA--Seattle, WA, NW              8       B   Roof replace--East, West bldgs, & library (NMFS funded)..............................  ..........
             Fisheries Science Ctr,
             Montlake
        OFA WA--Seattle, WA, Western         8       B   Asphalt repairs & Seal coating parking lots 1, 3, 4 & surfaces.......................     149,539
             Regional Ctr
        OFA WA--Seattle, WA, Western         8       B   Replace HVAC controls & operators....................................................     235,200
             Regional Ctr
        OFA WA--Seattle, WA, Western         8       B   Roof replacement Bldg. 1 incl. canopy................................................     598,080
             Regional Ctr
        NWS FL--Tampa, FL, Ruskin Upper      8       B   Replace doors on upper air bldg (funded by NWS)......................................  ..........
             Air Facility
     NESDIS VA--Wallops Island, VA,          8       B   Water plant upgrade (funded by NESDIS)...............................................  ..........
             Data Acquis. Station
        NWS FL--West Palm Beach, FL,         8       B   Roof replacement: NWS FUNDED.........................................................  ..........
             WSO
       NMFS MA--Woods Hole, MA, NE           8       B   Repl. windows--Aquar. & Maint. Bldgs. (NMFS part fnd)................................      61,600
             Fisheries Science Center
        NOS SC--Charleston, SC, Coastal      8        C  Inst. new HVAC in bldg #2 (funded by NOS--contr. prob.)..............................     319,200
             Services Center
       NMFS WA--Manchester, WA Field         8        C  Electrical upgrade of armored power cable to facility................................     112,000
             Station
       NMFS WA--Manchester, WA Field         8        C  Upgrade seawater delivery system.....................................................     112,000
             Station
        OAR HI--Mauna Loa, HI, GMCC          8        C  General construction.................................................................  ..........
             Observatory
       OMAO VA--Norfolk, VA, Atlantic        8        C  Building 2 office space..............................................................     184,800
             Marine Center
        OAR OK--Norman, OK Nat'n.            8        C  Repair of Norman radar dome facility (OAR funded)....................................  ..........
             Severe Storms Lab
       NMFS FL--Panama City, FL, Lab         8        C  Replace/repair underground dosmestic water lines.....................................       5,600
       NMFS FL--Panama City, FL, Lab         8        C  Repairs for walk in freezer..........................................................      11,200
       NMFS MA--Woods Hole, MA, NE           8        C  Seal Pool Upgrades--Aquarium.........................................................     448,000
             Fisheries Science Center
        NWS UT--Salt Lake City, UT,          8       D   Paint exterior and seal exterior walls (funded by NWS)...............................  ..........
             Upper Air Facility
        NWS AmSam--American Samoa, Pago      7       B   Residence repairs: NWS FUNDED........................................................  ..........
             Pago WSO
        NWS AK--Barrow, other AK WSOs:       7       B   Energy conservation renovations......................................................      56,000
             Nome, St. Paul, AnnetteIs,
             McGrath, AK
        NOS NC--Beaufort, NC, Lab            7       B   Window Replacement--Admin. Wing......................................................      23,520
        NOS NC--Beaufort, NC, Lab            7       B   Window Replacement Project--Fisheries Wing...........................................     119,952
        NOS NC--Beaufort, NC, Lab            7       B   Electrical ystem renovation--Main Lab................................................     151,312
        NOS NC--Beaufort, NC, Lab            7       B   Mechanical Renovation, Main Lab (Ecology wing).......................................     175,392
        NOS NC--Beaufort, NC, Lab            7       B   Seawall Replacement--North Side of Pivers Island.....................................     486,864
        NOS NC--Beaufort, NC, Lab            7       B   Misc. building upgrade--Main Lab (completed).........................................  ..........
        OAR CO--Fritz Peak, CO               7       B   Main Laboratory Rehab................................................................      69,776
             Observatory
       NMFS TX--Galveston, TX, Lab           7       B   Roof Repairs--Bldgs. #302 & #306.....................................................  ..........
       NMFS AK--Juneau, AK, AFSC             7       B   Subport Drainage and Paving..........................................................     280,000
             Subport
       NMFS CA--La Jolla, CA, S.W.           7       B   Freight Elevator Upgrade (incl. A/E des. & Tvl)......................................      78,400
             Fisheries Science Ctr
       NMFS CA--La Jolla, CA, S.W.           7       B   Office heaters, a-201, library (NMFS funded).........................................  ..........
             Fisheries Science Ctr
       NMFS WA--Manchester, WA Field         7       B   Dicap ramp and exterior repairs......................................................      39,200
             Station
        OAR HI--Mauna Loa, HI, GMCC          7       B   Repair Access Road...................................................................      33,600
             Observatory
        NWS AK--Nome, AK, WSO                7       B   Heating system Renovation (Removal asbestos).........................................      19,600
       OMAO VA--Norfolk, VA, Atlantic        7       B   Replace bulkhead--Parcel 1...........................................................   4,032,000
             Marine Center
        OAR TN--Oak Ridge, TN, AT&D Lab      7       B   Main Bldg. Floor Finish Replacement..................................................      72,800
        OAR TN--Oak Ridge, TN, AT&D Lab      7       B   Replace siding--main bldg (funded by DOE)............................................  ..........
       NMFS CA--Pacific Grove, CA            7       B   Refurbish heating and ventilation system.............................................      22,400
       NMFS FL--Panama City, FL, Lab         7       B   Replace roof system--other than main bldg............................................      62,272
       NMFS WA--Seattle, WA, NW              7       B   Replace heating system--West bldg....................................................     324,800
             Fisheries Science Ctr,
             Montlake
     NESDIS VA--Wallops Island, VA,          7       B   Replace Generators 1 & 2.............................................................     201,600
             Data Acquis. Station
     NESDIS VA--Wallops Island, VA,          7       B   Roof Repair--funded by NESDIS........................................................  ..........
             Data Acquis. Station
       NMFS MA--Woods Hole, MA, NE           7       B   Replace Ceiling--Aquarium............................................................     106,400
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           7       B   Replace Floor Coverings (tile)--Aquarium.............................................     106,400
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           7       B   Replace Fac. Elec. Svc. Entrance--Maint. Bldg........................................     224,000
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           7       B   Install new mech. system--Aquarium...................................................  ..........
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           7       B   Replace emergency generator..........................................................  ..........
             Fisheries Science Center
        NWS AK--Yakutat, AK, WSO             7       B   Water/electrical system renovation...................................................      56,000
        NOS NC--Beaufort, NC, Lab            7        C  Engineering study for bridge repair..................................................  ..........
        NOS SC--Charleston, SC, Coastal      7        C  Correct sinkhole problem.............................................................      28,000
             Services Center
     NESDIS AK--Fairbanks, AK, Gilmore       7        C  Construct Vehicle Maintenance Facility...............................................   2,576,000
             Creek CDA Sta
        OAR MI--Muskegon, MI, Fld Sta        7        C  Build New Harbor (CG funding harbor dredging)........................................     403,200
       NMFS RI--Narragansett, RI, Lab        7        C  New storage building: NMFS FUNDED....................................................  ..........
       NMFS MS--Pascagoula, MS, Lab          7       D   Replace roof, upgrade roof insulation................................................     194,040
       NMFS MS--Pascagoula, MS, Lab          7       D   Old Wing Window Renovation Replmt. (funded by LO)....................................  ..........
       NMFS WA--Seattle, WA, NW              6   ......  Construct water recycling facil: CIP FUNDED..........................................  ..........
             Fisheries Science Ctr,
             Montlake
        NOS NC--Beaufort, NC, Lab            6       A   Elevator Replacement.................................................................     130,536
        OAR CO--Boulder, CO, Table           6       A   Replace Bldg. T-2....................................................................     112,000
             Mountain Observatory
       NMFS OR--Hammond, OR, Pt. Adams       6       A   Lighting improvement.................................................................      17,920
             Field Station
       NMFS HI--Honolulu, HI, Lab            6       A   Replace the outside stor. structure--NMFS complete 1997..............................  ..........
       NMFS FL--Miami, FL S.E.               6       A   Replace Generator....................................................................      89,600
             Fisheries Science Center
       NMFS OR--Newport, OR, Lab             6       A   Electrical Repairs...................................................................       6,720
       NMFS OR--Newport, OR, Lab             6       A   Replace existing roof on 2 bldgs (incl. A/E Design & Tvl)............................     756,000
       NMFS FL--Panama City, FL, Lab         6       A   Handicap Access./Safety/Exit Sign....................................................      46,144
        OAR CO--Platteville, CO              6       A   Rehab Warehouse Office Space.........................................................     106,400
        NWS AK--Pribilof Islands, AK,        6       A   Emergency communication system.......................................................      95,200
             St. Paul WSO
        OFA WA--Seattle, WA Western          6       A   Improve HVAC duct distrubution to American Society for heating, refrigeration, a/c        623,056
             Regional Ctr                                 engine.
        NOS SC--Charleston, SC, Coastal      6       B   Exterior Survey......................................................................      50,400
             Services Center
       NMFS CA--La Jolla, CA, S.W.           6       B   Replace some heaters throughout facility.............................................      84,000
             Fisheries Science Ctr
        OAR FL--Miami, FL, AOML              6       B   Roof replacement--Lab Bldg (OAR Funded)..............................................  ..........
       NMFS CT--Milford, CT, Lab             6       B   Replace Roofing--Several buildings...................................................      95,200
       NMFS CT--Milford, CT, Lab             6       B   Repave Parking Lot...................................................................      95,200
       NMFS CT--Milford, CT, Lab             6       B   Building 2 HVAC Upgrade..............................................................     140,000
       NMFS CT--Milford, CT, Lab             6       B   New Storage/Office Building..........................................................     252,000
       NMFS OR--Newport, OR, Lab             6       B   Renovate seawater sand filter system; repair temp rms................................      36,736
        OAR TN--Oak Ridge, TN, AT&D Lab      6       B   Upgrade HVAC system in wind tunnel bldg (funded DOE).................................  ..........
        NOS MD--Oxford, MD, Lab              6       B   Construct new storage bldg (funded QP4AOX)...........................................  ..........
       NMFS FL--Panama City, FL, Lab         6       B   Resurface parking lot and roadway....................................................     118,832
       NMFS AK--Pribilof Islands, AK,        6       B   Rehab of Laboratory Bldg--St. Paul...................................................     196,000
             St. Paul Lab
        OAR NJ--Princeton, NJ, ERL           6       B   Exterior Repairs (Masonry & Link Roofs)..............................................      50,400
             Geophysys. Dynam. Lab
        OFA WA--Seattle, WA, Western         6       B   Replace 7 HVAC rooftop units, bldg 4.................................................     802,592
             Regional Ctr
     NESDIS VA--Wallops Island, VA,          6       B   Painting and Doors (NESDIS funded)...................................................  ..........
             Data Acquis. Station
       NMFS MA--Woods Hole, MA, NE           6       B   Replace Siding--Aquarium Building....................................................      95,200
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           6       B   Install new HVAC System--Laboratory..................................................     448,000
             Fisheries Science Center
        NWS AK--Barrow, AK, WSO              6        C  Water treatment system (funded by NWS)...............................................  ..........
        NOS NC--Beaufort, NC, Lab            6        C  Repair/Conversion of old turtle rearing pens.........................................     448,000
        NWS AL--Birmingham, AL, WFO          6        C  Underfloor water sensor..............................................................       5,600
       NMFS OR--Hammond, OR, Pt. Adams       6        C  Restore emergency generator system...................................................      33,600
             Field Station
       NMFS OR--Hammond, OR, Pt. Adams       6        C  Wet Lab Repair & Maintenance.........................................................     231,840
             Field Station
       NMFS CA--La Jolla, CA, S.W.           6        C  Install Riprap Revetment.............................................................     761,600
             Fisheries Science Ctr
       NMFS WA--Manchester, WA Field         6        C  Develop Freshwater recycle system....................................................     180,320
             Station
       NMFS RI--Narragansett, RI, Lab        6        C  Replace sea water system.............................................................     392,000
        NWS LA--New Orleans, LA, WFO         6        C  Walter Filtration System.............................................................      22,400
       NMFS OR--Newport, OR Lab              6        C  Replace Seawater Heating system......................................................      16,800
       OMAO VA--Norfolk, VA, Atlantic        6        C  Security Upgrade (ASC/EASC Secy. Proj. funded).......................................  ..........
             Marine Center
       NMFS FL--Panama City, FL, Lab         6        C  Install temperature alarms, walk-in freezers.........................................       2,240
       NMFS MA--Woods Hole, MA, NE           6        C  Install security system--Laboratory (ASC secy. funded)...............................  ..........
             Fisheries Science Center
        NOS NC--Beaufort, NC, Lab            6       D   Fire Alarm System Evaluation.........................................................      11,760
        NOS NC--Beaufort, NC, Lab            6       D   Underground Outflow collector system.................................................      15,758
        NOS NC--Beaufort, NC, Lab            6       D   Lighting Efficiency Upgrade..........................................................      73,472
        NWS KS--Goodland, KS, WFO            6       D   Lighting Efficiency Upgrade..........................................................      17,024
       NMFS AK--Juneau, AK, Auke Bay         6       D   Modify fire sprinkler system in fish house and pier..................................     212,800
             Lab
        NOS HI--Kihei, HI, Marine            6       D   Repair asph.concrete drivewy & parking lot (done by LO)..............................  ..........
             Sanctuary
       NMFS WA--Manchester, WA Field         6       D   Upgrade building and site for ADA accessibility......................................      95,200
             Station
       NMFS WA--Manchester, WA Field         6       D   Install High Security Locks (funded by Security).....................................  ..........
             Station
       NMFS WA--Manchester, WA Field         6       D   Intrusion detection system (completed w/security fnds)...............................  ..........
             Station
       NMFS FL--Miami, FL S.E.               6       D   Replace doors and frames.............................................................      67,200
             Fisheries Science Center
       NMFS FL--Miami, FL S.E.               6       D   Restroom Renovation..................................................................      75,040
             Fisheries Science Center
        OAR FL--Miami, FL, AOML              6       D   Fire Alarm System Evaluation.........................................................      17,920
        OAR FL--Miami, FL, AOML              6       D   Lighting Efficiency Upgrade..........................................................      93,632
        OAR MI--Muskegon, MI, GLERL Lab      6       D   Finish new boat maintenance bldg.....................................................      39,368
       OMAO VA--Norfolk, VA, Atlantic        6       D   Security Upgrades....................................................................      56,000
             Marine Center
       OMAO VA--Norfolk, VA, Atlantic        6       D   Handicapped Accessibility............................................................     280,000
             Marine Center
        OAR TN--Oak Ridge, TN, A&TD Lab      6       D   Modify restrooms for handicapped accessibility (DOE fnd).............................  ..........
       NMFS FL--Panama City, FL, Lab         6       D   Replace Entrance Gate................................................................      10,080
       NMFS FL--Panama City, FL, Lab         6       D   Replace irrigation pumps.............................................................      12,085
       NMFS FL--Panama City, FL, Lab         6       D   Replace doors........................................................................      16,800
       NMFS FL--Panama City, FL, Lab         6       D   New Emergency Generator..............................................................      84,000
        OFA WA--Seattle, WA Western          6       D   Facility Condition survey............................................................     280,000
             Regional Ctr
     NESDIS VA--Wallops Island, VA,          6       D   Handicapped Access...................................................................     106,400
             Data Acquis. Station
       NMFS MA--Woods Hole, MA, NE           6       D   Handicapped Access. Renovations--Cottage.............................................      61,600
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           6       D   Handicapped Access. Renovations--Lab Bldg............................................     252,000
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           6       D   Renovate public restrooms--Aquarium (NMFS funded)....................................  ..........
             Fisheries Science Center
        NOS NC--Beaufort, NC, Lab            5       B   Sea wall repair......................................................................     200,704
       NMFS FL--Miami, FL S.E.               5       B   Install new roof--Annex--NMFS FUNDED.................................................  ..........
             Fisheries Science Center
        NWS AK--Pribilof Islands, AK,        5       B   Residence renovation.................................................................      16,800
             St. Paul WSO
        OAR NJ--Princeton, NJ, ERL           5       B   Repair & resurface parking lot--OAR funded...........................................  ..........
             Geophys. Dynam. Lab
        OFA WA--Seattle, WA, Western         5       B   Carpet Replacement Bldg. 1...........................................................     320,656
             Regional Ctr
        NWS VA--Sterling, VA, R & D Ctr      5       B   Resurface Roadway (Funded by LO).....................................................  ..........
       NMFS CA--Tiburon, CA, Lab             5       B   Replace roof 2nd floor admin bldg (NMFS funded)......................................  ..........
     NESDIS VA--Wallops Island, VA,          5       B   Replace roof--ops bldg...............................................................     212,800
             Data Acquis. Station
       NMFS MA--Woods Hole, MA, NE           5       B   Replace sea water supply system--NMFS funded.........................................  ..........
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           5       B   Repave parking lots at Aquarium/Cottages.............................................  ..........
             Fisheries Science Center
        NWS GA--Atlanta, GA, WSO             5        C  Parking lot extension (NWS funded)...................................................  ..........
        NOS NC--Beaufort, NC, Lab            5        C  Refurbish Coatings on Salt Water Tanks...............................................       5,264
        NWS AL--Birmingham, AL, WFO          5        C  Construct WFO Storage Building.......................................................      56,000
        NWS TX--Brownsville, TX, WFO         5        C  Construct WFO storage bldgs..........................................................      56,000
        NWS FL--Jacksonville, FL, WFO        5        C  Construct WFO Storage Building.......................................................      56,000
       NMFS AK--Kodiak, AK, Gibson Cove      5        C  UFAS (ADA) upgrade...................................................................      67,200
        NWS FL--Melbourne, FL, WSO           5        C  Replace ceiling and lights (funded by NWS)...........................................  ..........
        NWS AL--Mobile, Alabama, WFO         5        C  Construct WFO Storage Building.......................................................      56,000
        NWS TN--Morristown, TN, WFO          5        C  Construct WFO Storage Building.......................................................      56,000
             Site
       NMFS OR--Newport, OR Lab              5        C  Upgrade Emergency distribution.......................................................      44,800
       NMFS OR--Newport, OR, Lab             5        C  Balance air pressure in Aquaculture Lab..............................................     112,000
        OAR TN--Oak Ridge, TN, AT&D Lab      5        C  Wind Tunnel Bldg. Addition...........................................................     420,000
       NMFS FL--Panama City, FL, Lab         5        C  Replace boat house doors.............................................................       3,920
        OFA WA--Seattle, WA Western          5        C  Utility vault replacement............................................................     112,000
             Regional Ctr
        NWS VA--Sterling, VA, R & D Ctr      5        C  Storage Building (NWS funded)........................................................  ..........
     NESDIS VA--Wallops Island, VA,          5        C  Resesl Antenna Found.................................................................      72,800
             Data Acquis. Station
     NESDIS VA--Wallops Island, VA,          5        C  Construct equip. storage bldg (funded by NESDIS).....................................  ..........
             Data Acquis. Station
        NOS NC--Beaufort, NC, Lab            5       D   Split type heat pump sys. replacement--radiation bldg................................       4,234
        NOS NC--Beaufort, NC, Lab            5       D   Exterior Rehab.--Nine Buildings......................................................      74,144
        NOS SC--Charleston, SC, Coastal      5       D   CSC Building #2 Former Boilder Room..................................................      28,000
             Services Center
        NWS TX--Corpus Christi, TX, WFO      5       D   Exterior lighting (funded by Security)...............................................  ..........
        OAR CO--Fritz Peak, CO               5       D   Handicap Accessibility Modifications.................................................     268,576
             Observatory
       NMFS TX--Galveston, TX, Lab           5       D   Construct Freezer Building (NWS Funded)..............................................  ..........
        NWS KS--Goodland, KS, WFO            5       D   New water softner/water filtering system.............................................       3,472
        NWS KS--Goodland, KS, WFO            5       D   Install New Temperature Control System (NWS Funded)..................................  ..........
       NMFS HI--Honolulu, HI, Lab            5       D   Air Conditioning Upgrade.............................................................      22,400
       NMFS HI--Honolulu, HI, Lab            5       D   Complete restroom upgrade--NMFS FUNDED...............................................  ..........
       NMFS CA--La Jolla, CA, S.W.           5       D   Repl. inadeq. windows, doors & louvers...............................................     336,000
             Fisheries Science Ctr
       NMFS WA--Manchester, WA Field         5       D   Fire Support system..................................................................      67,200
             Station
       NMFS WA--Manchester, WA Field         5       D   Foundation corrections...............................................................     282,912
             Station
       NMFS WA--Manchester, WA Field         5       D   Site Paving (NWS Funded).............................................................  ..........
             Station
       NMFS FL--Miami, FL S.E.               5       D   Rebuild Parking lot..................................................................      42,560
             Fisheries Science Center
       NMFS FL--Miami, FL S.E.               5       D   Replace windows......................................................................     134,400
             Fisheries Science Center
       NMFS FL--Miami, FL S.E.               5       D   Remodel Bathrooms....................................................................     168,000
             Fisheries Science Center
        OAR FL--Miami, FL, AOML              5       D   Replace Exterior Doors and Frames....................................................       6,944
        OAR FL--Miami, FL, AOML              5       D   General Repairs to Exterior of Storage Bldg..........................................      11,021
        OAR FL--Miami, FL, AOML              5       D   Solar Film Replacement...............................................................      24,304
       NMFS OR--Newport, OR Lab              5       D   Install handling unit smoke detectors................................................       7,280
       NMFS OR--Newport, OR Lab              5       D   Powerwash roofs......................................................................      33,600
       NMFS OR--Newport, OR Lab              5       D   Install Environmental Controls System................................................      84,000
       OMAO VA--Norfolk, VA, Atlantic        5       D   HVAC Upgrades........................................................................      56,000
             Marine Center
       OMAO VA--Norfolk, VA, Atlantic        5       D   Handicapped elevator access (delete--part of E1271)..................................  ..........
             Marine Center
        OAR TN--Oak Ridge, TN, AT&D Lab      5       D   Paving and Landscaping...............................................................      50,400
       NMFS CA--Pacific Grove, CA            5       D   Access control system................................................................      11,200
       NMFS CA--Pacific Grove, CA            5       D   Retrofit light fixtures..............................................................      13,440
       NMFS CA--Pacific Grove, CA            5       D   UFAS compliance......................................................................     168,000
       NMFS CA--Pacific Grove, CA            5       D   Fence maintenance repair (Funded by Security)........................................  ..........
       NMFS WA--Seattle, WA, NW              5       D   Complete Asphalt Paving Repairs (NMFS completed).....................................  ..........
             Fisheries Science Ctr,
             Montlake
        OFA WA--Seattle, WA, Western         5       D   lighting upgrade, bldg. 4............................................................     195,888
             Regional Ctr
        NWS     Southern Region, NWS         5       D   Refurbish radar domes and towers (NWS funded)........................................  ..........
                 multiple locations
        NWS     Southern Region, NWS         5       D   Rehab upper air bldgs & radomes (funded by NWS)......................................  ..........
                 multiple locations
     NESDIS VA--Wallops Island, VA,          5       D   Upgrade Water & Sewer................................................................     392,000
             Data Acquis. Station
       NMFS MA--Woods Hole, MA, NE           5       D   Renovate Restrooms--Lab..............................................................      72,800
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           5       D   Pier & Bulkhead Water Service........................................................      78,400
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           5       D   Replace existing elevator--Lab.......................................................     123,200
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           5       D   Replace Elevator--Maintenance Bldg...................................................     123,200
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           5       D   Install sprinkler system--laboratory.................................................     168,000
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           5       D   Install sprinkler system--Aquarium...................................................     336,000
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           5       D   Install new entrance--Laboratory.....................................................  ..........
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           5       D   Repl handcppd ramp at main entry to Lab Bldg.........................................  ..........
             Fisheries Science Center
        NWS NM--Albuquerque, NM, WFO         4        C  Parking lot Extension................................................................      16,800
        NWS AL--Birmingham, AL, WFO          4        C  Parking Lot Extension................................................................      16,800
        NWS TX--Brownsville, TX, WFO         4        C  Parking lot Extension................................................................      16,800
        NWS TX--Corpus Christi, TX, WFO      4        C  Water line to UAIB...................................................................       3,360
        NWS TX--Corpus Christi, TX, WFO      4        C  Parking Lot Extension................................................................      16,800
       NMFS OR--Hammond, OR, Pt. Adams       4        C  Enclose lean-to & add sliding doors..................................................      56,000
             Field Station
        NWS FL--Jacksonville WFO             4        C  Parking lot Extension................................................................      16,800
        NOS HI--Kihei, HI, Marine            4        C  General upgrade of Visitor Center....................................................      67,200
             Santuary
        NOS HI--Kihei, HI, Marine            4        C  General upgrade of Main Building (part. compl. by LO)................................     115,360
             Santuary
        NWS TN--Knoxville, TN, WFO           4        C  Parking lot Extension................................................................      16,800
        NWS LA--Lake Charles, LA, WFO        4        C  Parking Lot Extension................................................................      16,800
        NWS AR--Little Rock, AR, WFO         4        C  Parking lot Extension................................................................      16,800
       NMFS FL--Miami, FL S.E.               4        C  Interior painting....................................................................      50,400
             Fisheries Science Center
        NWS TX--Midland/Odessa, TX, WFO      4        C  Parking Lot Extension................................................................      16,800
        NWS AL--Mobile, AL, WFO              4        C  Parking Lot Extension................................................................      16,800
       NMFS WA--Mukilteo, WA, Field          4        C  Sea Water System.....................................................................      46,816
             Station
        OAR MI--Muskegon, MI, GLERL          4        C  New boat maintenance bldg (OAR funded)...............................................  ..........
             Vessel Ops Facility
       NMFS FL--Panama City, FL, Lab         4        C  Seawater system......................................................................     231,840
        OFA WA--Seattle, WA Western          4        C  Smoking shelters & signs.............................................................      44,800
             Regional Ctr
        OFA WA--Seattle, WA Western          4        C  Halon fire suppression system replacement............................................     104,944
             Regional Ctr
        NWS FL--Tampa, FL, Ruskin WSO        4        C  Parking lot repair: NWS FUNDED.......................................................  ..........
        NOS SC--Charleston, SC, Coastal      4       D   Security Fence Installation..........................................................      61,600
             Services Center
        NOS SC--Charleston, SC, Coastal      4       D   Demolition of 2 towers & assoc. small buildings......................................      72,800
             Services Center
        NWS HI--Ewa Beach, HI, Tsunami       4       D   Replace existing water sprinkler system..............................................     185,920
             Warning Ctr
        NWS HI--Ewa Beach, HI, Tsunami       4       D   Clear & Grub for Security Access (NWS funded)........................................  ..........
             Warning Ctr
        NWS HI--Ewa Beach, HI, Tsunami       4       D   PTWC Solar Hot Water & outdoor Lighting DOE fund.....................................  ..........
             Warning Ctr
        NWS TX--Ft. Worth, TX, WFO           4       D   OPS Room Lighting....................................................................       5,600
        NWS TX--Ft. Worth, TX, WFO           4       D   Loading Dock.........................................................................      11,200
       NMFS OR--Hammond, OR, Pt. Adams       4       D   Oil cedar shake roofs................................................................       5,600
             Field Station
       NMFS HI--Honolulu, HI, Lab            4       D   Painting and relighting-NMFS FUNDED..................................................  ..........
       NMFS AK--Juneau, AK, Auke Bay         4       D   Replace sec. gates at ABL & Subport (NMFS complet 1997)..............................  ..........
             Lab
       NMFS CA--La Jolla, CA, S.W.           4       D   Painting and relighting (NMFS Funded)................................................  ..........
             Fisheries Science Ctr
       NMFS WA--Manchester, WA Field         4       D   Upgrade Bldg. lab counters, sinks, shelves (NMFS funded).............................  ..........
             Station
        OAR FL--Miami, FL, AOML              4       D   Seal Coating of Access Drives & Parking Lots.........................................      10,192
        NOS MD--Oxford, MD, Lab              4       D   Replace pump house windows & doors (QP4AOX)..........................................  ..........
       NMFS FL--Panama City, FL, Lab         4       D   Install Security Screens.............................................................       5,320
       NMFS MS--Pascagoula, MS, Lab          4       D   Cork removal.........................................................................      42,336
        NWS TX--San Antonio, TX, WFO         4       D   Misc. interior repairs...............................................................       8,400
       NMFS MA--Woods Hole, MA, NE           4       D   Install New HVAC System--Cottage.....................................................      84,000
             Fisheries Science Center
       NMFS MA--Woods Hole, MA, NE           4       D   Upgrade Interior Finishes--Lab Bldg..................................................     235,200
             Fisheries Science Center
       NMFS AK--Kodiak, AK, Gibson Cove      3        C  Complete bldg interior (LO funded)...................................................  ..........
        NOS SC--Charleston, SC, Coastal      3       D   Seismic Survey.......................................................................      72,800
             Services Center
       NMFS OR--Hammond, OR, Pt. Adams       3       D   Paint main bldg......................................................................      44,800
             Field Station
       NMFS OR--Newport, OR, Lab             3       D   Replace fluorescent lights w/energy efficient fixtures...............................      44,800
       NMFS OR--Newport, OR, Lab             3       D   Replace fluorescent lights w/energy efficinet fixtures...............................      56,000
       NMFS WA--Seattle, WA, NW              3       D   Exterior Painting--All Bldgs.........................................................     151,200
             Fisheries Science Ctr,
             Montlake
       NMFS MA--Woods Hole, MA, NE           3       D   Construct new park lots..............................................................  ..........
             Fisheries Science Center
        NOS NC--Beaufort, NC, Lab            2       D   Infrared Scan and Reliability Testing................................................       2,464
        NOS SC--Charleston, SC, Coastal      2       D   Resurfacing exterior grounds.........................................................      95,200
             Services Center
       NMFS FL--Panama City, FL, Lab         2       D   Repair Fence.........................................................................      13,888
       NMFS MS--Pascagoula, MS, Lab          2       D   Underground sprinkling system........................................................      19,404
       NMFS MS--Pascagoula, MS, Lab          2       D   Refurbishing of Existing Warehouses..................................................      42,336
       NMFS MS--Pascagoula, MS, Lab          2       D   Laboratory Cabinets..................................................................      48,451
        OFA WA--Seattle, WA Western          2       D   Art works restoration................................................................     280,000
             Regional Ctr
       NMFS OR--Hammond, OR, Pt. Adams       1       D   Cedar shingle roof coating (NMFS completed 1996).....................................  ..........
             Field Station
    --------------------------------------------------------------------------------------------------------------------------------------------------------

                    ocean exploration and education programs
        Question. In recent years, NOAA has expanded its role into
    exploratory oceans research and education. This expanded role is
    evident in NOAA's Ocean Exploration, Sustainable Seas, and JASON
    Programs. What is your goal in expanding NOAA's mission into these
    areas?
        Answer. NOAA's expanded role in ocean exploration is actually
    overdue. It can be traced back to the 1970 report of the Stratton
    Commission which recommended that NOAA develop U.S. Leadership in Ocean
    Exploration. In October 2000, the report of the President's Panel on
    Ocean Exploration, ``Discovering Earth's Final Frontier: A U.S.
    Strategy for Ocean Exploration'', recommended (page 33) that a single
    lead agency be designated as, ``. . . in charge and accountable for the
    Program and its budget.'' NOAA has had over 30 years of experience in
    managing the conservation, sustainable use, and commercial aspects of
    our oceans. Recognizing our stewardship role regarding the oceans, the
    Secretary of Commerce offered NOAA to the President as lead agency for
    the new national effort in ocean exploration. Congress also recognized
    NOAA's role by appropriating $4 million in NOAA in fiscal year 2001 to
    begin the program.
        The chief goal of the Ocean Exploration Program (OE) is to increase
    our body of knowledge by collecting scientific data on areas of the
    ocean, particularly the U.S. Exclusive Economic Zone (EEZ), where no or
    inadequate data exist today to serve NOAA and other policy and
    decision-makers in managing ocean resources. We will engage in the
    search and systematic investigation of the oceans for the purpose of
    discovery, and will record the findings for future research. We also
    intend to educate America's school children and the general public on
    ocean science and related issues. The purpose of the Program is to gain
    fuller knowledge of the fundamental aspects of ocean phenomena and of
    observable facts without specific applications toward processes or
    products in mind. Thus, it differs somewhat from NOAA's traditional
    applied research role which is intended to solve specific management
    concerns.
        Ocean exploration efforts such as Sustainable Seas Expeditions
    (SSE) and JASON do not represent an expansion of NOAA's mission.
    Instead, they represent mechanisms for integrating much of NOAA's
    exploration and research activities in a more cohesive manner.
    Exploration linked to: (1) learning more about areas we know nothing or
    very little about; (2) addressing scientific hypotheses related to the
    resources we are mandated to manage and protect; and (3) educating the
    public whose behavior can affect these resources provides a solid
    foundation for existing NOAA programs. The information derived from
    these efforts is inextricably linked to how NOAA does business.
        Given the regional nature of ocean exploration efforts such as SSE,
    these endeavors also provide the opportunity for existing programs to
    collaborate on shared problems. This is especially true in relation to
    marine protected areas whose boundaries often do not reflect the true
    nature of dynamic oceanic processes. Exploration provides the impetus
    for looking beyond these boundaries and striving to understand how
    these processes influence the resources the areas were established to
    protect. In the long term, this approach provides much needed
    information for identifying, implementing, and monitoring more
    meaningful management strategies.
        The mission of The JASON Foundation for Education is to excite and
    engage students in science and technology, and to motivate and provide
    professional development for their teachers through the use of advanced
    interactive telecommunications. JASON expeditions, supported by
    extensive professional development for teachers and award-winning
    curricula, feature live, interactive broadcasts from distinctive sites
    on our planet through advanced technologies in robotics, fiber optics,
    television production, computer science, mechanical and electrical
    engineering, and satellite communications. Far behind the exploration
    of space and the investment of educational programs based on space
    exploration, NOAA is facing a deficit of programs and resources to meet
    the basics in educating our nation's youth on the importance of oceans
    and coastal areas. The JASON Project helps NOAA meet the challenge of
    educating the public about the importance of marine resources,
    particularly those protected by the National Marine Sanctuaries.
        Question. Why is NOAA the best agency for this field of research?
    Do you have any concerns that a shift toward this kind of research will
    come at a cost for your mission-critical programs?
        Answer. Ocean exploration is a part of NOAA's mission and the
    President's budget request reflects a balance that will serve all NOAA
    missions. In fact, rather than detract from existing programs, Ocean
    Exploration, Sustainable Seas and JASON complement and benefit other
    programs by improving the quantity and quality of information
    available, providing for additional education and outreach, and by
    increasing the effectiveness of NOAA at-sea missions by engaging in
    multidisciplinary voyages. These efforts actually provide a means to
    strengthen NOAA's other programs by providing basic information that is
    critical for making decisions related to targeting additional research
    and managing resources. Up to now, NOAA has not had a mechanism like
    SSE for integrating traditional scientific research with manned and
    unmanned submersible operations with a focus on improving our programs.
    Nor has NOAA had an effective mechanism, such as the Ocean Exploration
    program, to search and systematically investigate the oceans for the
    purpose of discovery, and record the findings for future research and
    application. Ocean exploration provides the agency with a means to both
    gather essential basic information about the oceans to provide
    information critical for selecting new areas requiring the attention of
    our programs and evaluate the effectiveness of existing programs and
    management measures.
        Question. In fiscal year 2002, you are asking for $18.5 million in
    funding for these programs. How do you intend to spend this money?
        Answer. In fiscal year 2002, the $14 million Ocean Exploration
    money will be spent as follows: $1 million (7 percent) for eight (8)
    full-time-equivalents and related operating expenses to manage the
    program; $1.4 million (10 percent) for education and outreach to
    stimulate interest in ocean sciences among the youth of America, and
    better inform all Americans about the oceans and their importance to
    life on Earth; $11.6 million (83 percent) on Science, which includes 6
    major and several minor multidisciplinary Voyages of Discovery to
    observe and record the biological, chemical, geological, and
    archaeological characteristics of the ocean areas being studied. Major
    voyages will include expeditions to the Gulf of Maine, South Atlantic
    Bight, Gulf of Mexico, Baja to the Bearing Sea, the Northwest Hawaiian
    Islands, and one of the Polar Regions.
        In terms of SSE, fiscal year 2002 represents the last year of the
    original five-year project. The funds invested in SSE will build on the
    ecosystem approach established this year in conjunction with the
    Islands in the Stream expedition. The fiscal year 2002 request for $2
    million for ``Sanctuaries and SSE Data Collection'' includes about
    $900,000 to support SSE. Specifically, the money will be invested in
    ensuring that the proper mix of resources are available (ships,
    submersibles, sampling equipment, personnel) to collect qualitative
    (visual) and quantitative (environmental data, bathymetric information)
    data in existing marine protected areas and other critical habitats
    along the west coast of North America from Baja California to the
    Bering Sea, Alaska areas that are environmentally important, and that
    are under increasing pressure from human activities. The data collected
    will be targeted at supporting existing management efforts, as well as
    continuing to educate the public that uses and influences these areas.
    The remaining portion of the $2 million request, about $1.1 million
    will be used to support non-SSE habitat and cultural resource
    characterization and science missions in the National Marine Sanctuary
    System.
        In fiscal year 2002, JASON ($2.5 million) will focus on one or more
    of NOAA's National Marine Sanctuaries. Using these ``living
    laboratories'', JASON will focus the minds of America's youth on the
    marine sanctuaries and broaden the knowledge and understanding of their
    resources and importance. NOAA's National Marine Sanctuary System is
    working with JASON and the Institute for Exploration on a pilot
    education effort. The goal of this joint effort is the creation of a
    pilot educational effort using these new technologies like
    telepresence, distance learning and virtual experience learning
    techniques with interactive capabilities. The initial program will be
    linking, in real time, Monterey Bay National Marine Sanctuary in
    Monterey, California and the Mystic Aquarium in Mystic, Connecticut.
    This joint effort will include the creation and testing of new
    underwater video equipment; the usage of new and emerging transmission
    technologies including satellite, broadband lines and web based
    programs; new ``immersion'' or virtual and interactive learning
    technologies; the creation of new marine science-based curriculum; and
    the evaluation of the video technologies, transmission techniques and
    educational accomplishments. The JASON Project funding is a pass-
    through grant.
        Question. What do you expect to learn from this research? How do
    these programs benefit the American Public? How do they benefit NOAA?
        Answer. The chief product and benefit of the Ocean Exploration
    program will be knowledge. The value of collecting and having this
    knowledge available is comparable to the value of education itself--
    which is not quantifiable. The result will be a better informed science
    community, and better information for policy and decision-making. With
    95 percent of the underwater world unseen and unknown to man, what
    remains to be explored may hold clues to the origins of life on Earth,
    cures for diseases, answers to how to achieve sustainable use of ocean
    resources, links to our maritime history, or information to protect
    endangered species. The potential return on investment is immense, but
    exploration and the collection of knowledge should be considered a
    success regardless of what is ultimately discovered.
        The SSE program will also visit areas that have never been seen
    before and gather new information about our ocean resources, primarily
    in the National Marine Sanctuaries. The information on habitat, fish,
    marine mammals, cultural resources, and other resources will provide a
    foundation for stimulating ideas, generating questions, and influencing
    future efforts to understand more about these resources. These areas
    may provide the Nation with new resources that we currently have no
    knowledge of, or that require a level of protection and management from
    adverse influences that we know little about. The effort will also
    provide the managers of existing marine protected areas with additional
    information critical to their programs.
        OE and SSE also benefit both NOAA and the nation by providing for a
    broad program of exploration of ocean resources across many scientific,
    cultural, and technological disciplines, and among many participants.
    These two projects provide the Government--NOAA--with a means to build
    an in-house capability for (a) directly engaging in undersea research
    using our own resources; and (b) helping to direct the efforts of other
    undersea research efforts conducted by private institutions to help
    address mandated needs. The programs promote discovery-based science,
    collaboration, education and outreach.
        The JASON Project helps NOAA meet the challenge of educating the
    public about the importance of marine sanctuaries and resources they
    protect. The JASON Project offers students and teachers in grades 4
    through 9 a comprehensive, multimedia approach to enhance teaching and
    learning in science, technology, math, geography, and associated
    disciplines. JASON excites and engages students in science and
    technology, and motivates and provides professional development for
    teachers. This education of our Nation's children is a clear benefit to
    the American public and is an important part of NOAA's mission.
        The SSE project and the collaboration with the National Geographic
    and other public and private institutions has proven to be a catalyst
    for new education and outreach partnerships and activities. The
    National Marine Sanctuary Program, as well as other NOAA programs that
    support SSE, have been the focus of unprecedented coverage from local
    and national media. Numerous products, including over 300 print
    articles and a variety of long-term workshops on topics such as marine
    resources, teacher education, marine geographic information systems,
    and others that use the information collected, are just some of the
    results.
        The information gained to date from SSE has been applied directly
    to current management issues in the Sanctuaries, i.e., the management
    plan revision for the Channel Islands, California site and the Tortugas
    2000 Initiative for the Florida Keys. Similar direct benefits are
    expected from OE expeditions. OE and SSE are collaborating on the
    ``Islands in the Stream'' expedition set for May through September 2001
    in the Gulf of Mexico and the U.S. east coast. This expedition targets
    specific areas along the Gulf Stream as it flows from Belize and along
    the Eastern U.S. Coast. The expedition includes characterization of
    Marine Protected Areas in Mexico, the anoxic zone beneath the Texas-
    Louisiana border, and the area of high productivity along Florida's Big
    Bend. It, and other expeditions will provide valuable opportunity for
    academic collaboration and heightened public awareness of coastal
    processes through exposure by National Geographic media. With knowledge
    as the chief product and benefit of OE, expeditions aim to characterize
    ecological systems in near-totality, looking at biota, geology, food
    web interactions, history, and benthos of a region, enabling potential
    better management of fisheries populations.
        Forty years ago, space and ocean exploration were both plunging
    into unknown realms at about the same pace. While we have made
    significant progress in space, our knowledge of earth's oceans has
    lagged. The Russians and Japanese have vehicles that provide them with
    access to deeper waters than we do. The Irish have mapped a larger
    portion of their EEZ than we have. America leads the world in Space
    Exploration and related technologies, and these ocean exploration
    programs are the first steps toward regaining our leadership in Ocean
    Exploration.
                           budget development process
        Question. How does NOAA develop its budget initiatives?
        Answer. NOAA has engendered the Government Performance and Results
    Act goal of linking planning and budget. NOAA implements a planning and
    budget process that forms a framework by which policy, program, and
    budget decisions are made. NOAA's annual request is arrayed as an
    operations-based budget, with performance indicators directly tied to
    the proposed application of resources. NOAA's Strategic Plan describes
    the goals and objectives that have been established to fulfill its
    visions. The strategy consists of seven interrelated goals that are
    grouped within the two missions of Environmental Assessment and
    Predication; and Environmental Stewardship. NOAA's budget initiatives
    are generated through the Strategic Team process by the seven teams;
    vetted through a series of reviews and meetings, with final decisions
    made by NOAA senior management.
        Question. How much staff time is spent developing NOAA's budget
    request?
        Answer. The budget development process is an agency-wide
    collaborative effort, and is difficult to track total staff hours spent
    on the development of the budget. The Office of Finance and
    Administration, and NOAA's five Line Offices' management and budget
    staffs, focus a significant part of their workforce on budget
    development. The NOAA Office of Budget, alone, dedicates approximately
    37,440 staff hours a year to the formulation process. Almost without
    exception, every office and program within NOAA devotes some time to
    budget development, and the amount of time depends upon the size,
    complexity and sensitivity of their individual program or project. This
    includes staff at regional and field offices who provide valuable
    expertise about program implementation and budgetary needs. The
    formulation process begins in February and continues through June with
    the Department budget submission; followed by the September OMB
    submission; and the submission of the President's Budget the following
    fiscal year.
        Question. In your view, is the time spent developing NOAA's budget
    request the best use of your staff's time?
        Answer. Yes. NOAA is a diverse agency responsible for providing
    timely and precise weather and climate forecasts that protect lives and
    property, managing fisheries and building healthy coastlines, making
    our nation more competitive through safe navigation and examining
    changes in the ocean. NOAA's budget formulation warrants the energy and
    focus. Since budget management (formulation, presentation, and
    execution) is one of the primary management functions of any
    organization, and considering the size and complexity of the NOAA
    budget, it is indeed the best use of staff time.
        Question. Do you intend to change this process in the future?
        Answer. The NOAA Office of Finance and Administration, NOAA Office
    of Budget, in 2001 conducted an assessment of the budget formulation
    process. One aspect of the process that was problematic was the fact
    that the budget formulation process was divided between the Office of
    Budget and the Office of Policy and Strategic Planning. A large part of
    the budget development was conducted outside the financial management
    chain of command. This created unwanted complexity in the budget as
    well as difficulties in matching what was developed to the actual
    budget structure. The outcome was that the formulation process was
    obfuscated by the separation of budget formulation and performance
    planning into separate offices. At the request of the Acting Under
    Secretary, the Director of the Office of Budget implemented a change in
    fiscal year 2001 to address this challenge. The budget development
    process was consolidated under one office--the Office of Finance and
    Administration (which houses the NOAA Office of Budget). This
    consolidation more firmly links budget formulation and development of
    program performance creating a unified framework within which policy,
    program and budget decisions are made.
                           research vessel allocation
        Question. Why did you decide to consolidate the Days At Sea
    responsibility under the Office of Marine and Aviation Operations
    (OMAO)?
        Answer. Consolidation of funds from the data acquisition line items
    to OMAO Marine Services will allow NOAA greater flexibility to meet
    high priority ship needs. Previously, the National Ocean Service,
    National Marine Fisheries Service, and Office of Oceanic and
    Atmospheric Research contained separate data acquisition line items
    that funded Line Office days-at-sea. With consolidation of NOAA's
    marine services, funding is now centrally located. An advantage of this
    consolidation is that it will allow NOAA increased integration of high
    priority programs of the agency as a whole, without being solely
    focused on Line Office missions. OMAO can ensure that the agency's
    vessel needs are best achieved with the funding provided for NOAA days-
    at-sea.
        Question. Which programs that have ship times do not fall under
    OMAO?
        Answer. The following are fiscal year 2002 ship days supporting
    NOAA programs which are not funded by the Marine Services account. The
    Office of Oceanic and Atmospheric Research, National Undersea Research
    Program (NURP) will use approximately 150 ship days of university and
    commercial charter ships to support underwater vehicle operations. The
    National Marine Fisheries Service will use approximately 2,265 ship
    days of university and commercial charter ships to provide fisheries
    stock assessment and habitat research data. Additional, yet to be
    determined ship support, will be required for NOAA's Ocean Exploration
    Program. National Ocean Service plans to contract for $20.5 million of
    charting survey data, most of which is collected from ships and small
    craft and will use approximately 50 days of university and commercial
    charter ships to collect data for the National Marine Sanctuary
    Program.
        Question. Why is this the case?
        Answer. The funds include items other than ship time, (e.g.,
    scientist salaries and overtime, contract support), so the funds are
    requested under the programs to avoid multiple internal NOAA fund
    transfers. The Marine Services request includes funds for NOAA ships
    and over 900 ship days of charter time, but these funds for charter
    time are used only to procure ship time.
        Question. Where does that ship time appear in NOAA's budget?
        Answer. The funds for shiptime that do not fall under OMAO are
    included in the line items that fund the programs.
        Question. How will this new allocation process change the
    individual Line Office allocations?
        Answer. The new budget structure will not affect the NOAA ship
    allocation process nor will it affect the ship time allocated to NOAA
    line offices. The NOAA ship allocation council will continue to
    allocate ship time to the line offices independent of the budget
    structure.
        Question. How will this process change the allocations of Days At
    Sea on NOAA-owned vessels versus NOAA-chartered vessels?
        Answer. There will be no change in the process for allocating ships
    days on NOAA ships and chartered ships. The NOAA ship allocation
    council will continue to allocate marine services funds for charter and
    university ship time as well as NOAA ship time. The line offices will
    continue to use funds separate from the marine services account for
    some outsourced ship time and associated support items.
        Question. How will you ensure that the critical science programs
    within NOAA still get their fair allocation of Days At Sea on their
    customary research vessels?
        Answer. The restructuring of the data acquisition accounts to the
    marine services account will not impact the NOAA ship allocation
    process. NOAA's science programs will still be represented as before on
    the NOAA ship allocation council and will have the same opportunity as
    before to acquire their needed ship time.
        Question. What proportion of the OMAO budget line will support the
    Sustainable Seas Expedition?
        Answer. Approximately 1 percent of the Marine Services budget is
    planned in fiscal year 2002 for ship support of the Sustainable Seas
    Expedition.
        Question. Who makes the final decision on the allocation of Days At
    Sea?
        Answer. The NOAA allocation process is a collaborative process
    which involves a working group with representatives of all the NOAA
    ship users, and an allocation council, composed of the NOAA Line Office
    Assistant Administrators and chaired by the NOAA Deputy Under
    Secretary. In those rare instances where conflicts cannot be resolved
    by the working group or by the council, the Deputy Under Secretary
    makes the final NOAA decision.
        Question. Can you provide me with the Days At Sea allocations for
    the last five years, including fiscal year 2001?
        Answer. The NOAA Fleet and Outsourced days-at-sea for fiscal years
    1997 through 2000 and the allocation plan for 2001 are shown below. The
    outsourced days include days funded through acquisition of data
    accounts and through other line office accounts, except for fiscal
    years 1997 and 1998. The files that included outsourced days funded
    through other line office accounts for 1997 and 1998 were temporarily
    misplaced. Also, the NOS outsourced days exclude the days for contracts
    for hydrographic data because the contracts are for square nautical
    miles of hydrography rather than days-at-sea.

    ------------------------------------------------------------------------
                                               NOAA
            Fiscal Year/Line Office           Fleet    Outsourced    Total
    ------------------------------------------------------------------------
    1997:
        NOS...............................        835  ..........        835
        NMFS..............................      1,709          96      1,805
        OAR...............................        447         221        668
                                           ---------------------------------
          Totals..........................      2,991         317      3,308
                                           =================================
    1998:
        NOS...............................        793          97        890
        NMFS..............................      1,565         103      1,668
        OAR...............................        548         236        784
                                           ---------------------------------
          Totals..........................      2,906         436      3,342
                                           =================================
    1999:
        NOS...............................        735         220        955
        NMFS..............................      1,596         935      2,531
        OAR...............................        604         428      1,032
                                           ---------------------------------
          Totals..........................      2,935       1,583      4,518
                                           =================================
    2000:
        NOS...............................        782         305      1,087
        NMFS..............................      1,621       1,223      2,844
        OAR...............................        530         397        927
                                           ---------------------------------
          Totals..........................      2,933       1,925      4,858
                                           =================================
    2001:
        NOS...............................        833         396      1,229
        NMFS..............................      1,947       1,650      3,597
        OAR...............................        559         470      1,029
                                           ---------------------------------
          Totals..........................      3,339       2,516      5,855
    ------------------------------------------------------------------------

        Question. Could you provide a plan for the fiscal year 2002
    allocation?
        Answer. The NOAA Fleet and outsourced allocation for fiscal year
    2002 is shown below. The outsourced days include days funded through
    Marine Services and through line office accounts. The outsourced days
    shown for OAR exclude days to be outsourced for the Ocean Exploration
    Program because details are still in process. The NOS outsourced days-
    at-sea exclude $20.5 million in contracts for hydrographic data because
    the contracts are for square nautical miles of hydrography rather than
    days at sea.

    ------------------------------------------------------------------------
                                               NOAA
                  Line Office                 Fleet    Outsourced    Total
    ------------------------------------------------------------------------
    NOS...................................        925         485      1,410
    NMFS..................................      1,985       2,265      4,250
    OAR...................................        460         670      1,130
                                           ---------------------------------
          Totals..........................      3,370       3,420      6,790
    ------------------------------------------------------------------------

                                nautical charts
        Question. I understand that the critical survey backlog encompasses
    less than 1.5 percent of the entire U.S. Exclusive Economic Zone (EEZ),
    and only 9 percent of the navigationally significant areas. If funded
    at the requested level, how long would it take to chart both the
    critical areas and the navigationally significant areas?
        Answer. At fiscal year 2001 funding levels, it will take just under
    20 years to eliminate the 43,000 square nautical mile critical survey
    backlog. Currently NOAA contracts out over $20 million in survey funds.
    The remaining navigationally significant areas (507,000 square nautical
    miles) would take 312 years to survey at current rates.
        Responsible for over 3.4 million square nautical miles of the U.S.
    Exclusive Economic Zone (EEZ), NOAA has prioritized the EEZ to maximize
    the efficiency of resources available for hydrographic survey data.
    NOAA has identified approximately 550,000 square nautical miles as
    navigationally significant, which are further prioritized by threat of
    hazard to surface navigation. The critical survey backlog addresses the
    43,000 square nautical miles, or approximately 1.3 percent of NOAA's
    charting responsibility, considered the most important to safe
    navigation. The highest priority are those critical waterways that have
    high commercial traffic volumes (cargo, fishing vessels, cruise ships,
    ferries, etc.), extensive petroleum or hazardous material transport,
    compelling requests from users, and/or transiting vessels with low
    under-keel clearance over the seafloor. Over half of the critical
    backlog area exists in Alaskan waters. This hydrographic survey
    information supports the production of Electronic Navigational Charts,
    and other navigation products and services, and also benefits other
    users such as ports authorities and coastal zone managers.
        Question. At this rate, how does NOAA intend to tackle the survey
    backlog?
        Answer. As stated above, NOAA has made the 43,000 square nautical
    miles considered most critical to safe navigation its top survey
    priority. Between in-house capability and funds allocated to contract
    surveys, NOAA has reduced the survey backlog to about 32,500 square
    nautical miles through the end of fiscal year 2000. NOAA will continue
    its mix of methods, contracting, in-house surveying, and possible
    future leased vessels, in efforts to eliminate the survey backlog.
    Funds were appropriated in fiscal year 2001 and proposed in the fiscal
    year 2002 President's Request to bring the deactivated NOAA Survey
    Vessel FAIRWEATHER back online in fiscal year 2003. Reactivation of the
    FAIRWEATHER would contribute significantly to reducing the backlog in
    Alaskan waters.
        Question. What will it take to collect hydrographic survey data and
    create electronic navigational charts (ENCs) to connect the
    navigationally significant waterways between the charted ports and
    harbors?
        Answer. Some areas between the ports charted on ENCs are also
    considered part of the critical survey backlog, particularly along the
    East and Gulf Coasts. Other areas between ports are considered
    navigationally significant, but are not part of the critical backlog.
    Ideally, surveys of these waters would be acquired before building the
    ENCs, but resource limitations have required a survey prioritization
    schedule. It would take significant additional resources, including
    contracts, charters, and in-house capabilities, to survey these areas
    in a reasonable time frame. The cost would depend heavily upon the time
    table established to complete the effort.
        NOAA supports a phased approach to building ENCs of U.S. waterways.
    With the proposed fiscal year 2002 funding increase, NOAA will build 65
    new ENCs in 2002 to complete the suite of 200 ENCs that cover the
    Nation's 40 major ports and harbors. The ENCs will then be continually
    maintained with new data and updates as part of NOAA's nautical
    charting database. The prioritization of the top 40 major U.S. ports
    and harbors for commercial navigation was determined by analyzing data
    ranking U.S. ports by cargo tonnage and major ports of call visited by
    the cruise line industry.
        NOAA's proposed next step would be to provide minimum contiguous
    ENC coverage for U.S. waters, in order to connect coastal waters
    between U.S. ports for safe navigation. A total of 660 ENCs would be
    required to achieve this goal. This next step is not included in the
    President's Request for fiscal year 2002. The estimate for full ENC
    coverage for U.S. waters, including specialized charts NOAA now
    produces in paper format, is 1,000 ENCs. NOAA would like to produce a
    seamless database of ENCs, which would significantly aid the U.S. Coast
    Guard and U.S. Navy, professional mariners, maritime pilots, commercial
    fishers, recreational boaters, and many other chart database users,
    such as coastal managers and emergency planners.
        Question. Are there new technologies, such as ships or charting
    equipment, that could speed up the process?
        Answer. Additional hydrographic survey vessel capacity would
    certainly speed up the process, whether NOAA platforms, funds for
    additional contracting, or leased vessels operating at NOAA's
    direction. Similarly, expansion of NOAA's Navigation Response Teams
    would increase the rate of production. These teams provide on-the-
    ground field verification and generate small-scale, fast-response
    hydrographic surveys and item investigations for major port and harbor
    ENCs. Currently, there are two such teams operating in the United
    States.
        Installing the newest survey technology on all NOAA hydrographic
    survey ships and Navigation Response Team launches would also increase
    production capability and data accuracy and contribute to reducing the
    survey backlog. Multi-beam sonar systems collect a wide full-bottom
    swath or fanshaped coverage of the seafloor for highly accurate depths,
    and high-speed/high resolution side scan sonar, which searches and
    detects objects on the seafloor, is very useful for identifying wrecks
    and obstructions, particularly in the shallower waters of the East
    Coast. Installing multi-beam sonars on NOAA's other research vessels
    would serve dual purposes, e.g., collecting fisheries habitat data and
    hydrographic survey data at the same time, since many of the areas that
    are important to fisheries research are also navigationally significant
    areas.
        Question. What areas do you intend to survey in fiscal year 2003?
        Answer. In fiscal year 2003, NOAA plans to survey or contract for
    surveys in: the Mid-Atlantic Corridor (Delaware-New Jersey), Eastern
    Long Island Sound (New York-Connecticut); Southern Chesapeake Bay
    (Virginia-Maryland); Block Island Sound (Rhode Island-New York); the
    Gulf of Mexico shipping corridors; Sitka Sound and adjacent waterways
    (Alaska); SW Alaska Peninsula; Eastern Prince William Sound; SE Alaska
    and Chatham Strait; and the Bering Strait.
        Question. Why did you decide to survey those areas first?
        Answer. These areas are all part of the identified critical survey
    backlog, and NOAA has scheduled them based on survey priority,
    stakeholder need and requests for survey from various government
    agencies and commercial groups.
        Question. What uncharted regions stand to be the most at risk from
    potential maritime disasters?
        Answer. The uncharted regions most at risk for potential maritime
    disasters are Alaskan waters where glaciers are receding at a rapid
    pace. Cruise ships ``pushing the envelope'' for the view enter these
    uncharted waters. A number have run aground in recent years, each one a
    potential catastrophe.
        Aside from Alaska, there are many other areas portrayed on nautical
    charts that have never been adequately surveyed. Nearly half of the
    depths on current charts were acquired before 1940 using less
    efficient, less accurate, and less complete leadline techniques. While
    charted, areas such as Houston/Galveston, Puget Sound and Prince
    William Sound, which see high commercial traffic, particularly in
    hazardous material cargo including oil and liquified natural gas, are
    also at tremendous risk for maritime disasters.
                              restoration programs
        Question. NOAA spends a significant amount of resources on habitat
    restoration. Much of this work is outstanding and has led to the
    restoration of thousands of acres of habitat. However, it has come to
    my attention that the restoration programs are scattered throughout
    NOAA in at least six different offices. What NOAA offices are currently
    involved in some aspect of habitat restoration, and how much are they
    spending on restoration work?
        Answer. NOAA is involved in the restoration of coastal habitats in
    a variety of ways and through a number of offices and programs. The
    diversity of programs reflects the wide variety of mandates under which
    NOAA operates and the complex series of issues captured under the
    umbrella term of ``restoration.'' NOAA has successfully implemented
    mechanisms for cooperative management of restoration programs
    encouraging cooperation and efficient use of resources. Restoration
    activities of the three NOAA line offices (National Marine Fisheries
    Service (NMFS), National Ocean Service (NOS), and Office of Oceanic and
    Atmospheric Research (OAR) are described below.
    National Marine Fisheries Service (NMFS)
        The major restoration activities of the National Marine Fisheries
    Service include the programs of the NOAA Restoration Center and as well
    as activities by the Exxon Valdez Oil Spill Restoration Center, Pacific
    Salmon Recovery Fund, South Central Florida Restoration Initiative, and
    the NMFS Coral Reef Initiative.
                Damage Assessment and Restoration Program (DARP)
        The Damage Assessment and Restoration Program (DARP) is a cross-
    cutting program composed of the NOAA Restoration Center, the Damage
    Assessment Center (housed in the NOAA National Ocean Service) and the
    Natural Resources section of the NOAA Office of General Counsel. (The
    Damage Assessment Center is mentioned again below in the NOS section.)
    The program receives its mandate from statutory authorities including
    the Comprehensive Environmental Response, Compensation, and Liability
    Act (CERCLA), the Oil Pollution Act, the Clean Water Act, and the
    Marine Protection, Research, and Sanctuaries Act (MPRSA). These
    statutes authorize NOAA, through the DARP, to assess and claim damages
    for injuries to trust resources in marine and coastal settings
    resulting from discharges of oil or hazardous substances or other
    human-induced environmental disturbances.
                Restoration Center
        The NOAA Restoration Center uses recovered damages to restore,
    replace, or acquire the equivalent of injured resources and has
    initiated restoration efforts at over one hundred sites around the
    country with over $313 million to date. NMFS uses approximately $1.6
    million of NOAA Restoration Center appropriated operational funds to
    support planning for and implementing restorations resulting from
    settlements with responsible parties.
        The NOAA Restoration Center also engages in regional restoration
    programs, including the Coastal Wetlands Planning, Protection, and
    Restoration Act (also known as the Breaux Act) to develop and implement
    habitat projects to restore salt marshes in Louisiana lost to erosion,
    subsidence and hydrological alterations. Today, the NOAA Restoration
    Center is actively involved in implementing twenty-two large- and
    small-scale wetland restoration projects benefiting more than 80,000
    acres with approximately $92 million in project funding. While most of
    these activities result from reimbursable Breaux Act funds made
    available through the Army Corps of Engineers, the NOAA Restoration
    Center annually uses between $50,000 and $100,000 of its operational
    funds to support the Breaux Act. In support of CWPPRA, the NMFS
    Galveston Laboratory invests a portion of its appropriated funds for
    scientific studies of the ecology, fishery productivity and restoration
    of Louisiana's coastal wetlands.
        The NOAA Restoration Center also actively supports special area
    regional restoration activities throughout the country. Examples
    include the Bronx River, NY (funded in fiscal year 2001 with $8.5
    million), and Pinellas County, FL (funded in fiscal year 2001 with $1.5
    million). Another regional program is Kentucky PRIDE (Personal
    Responsibility In a Desirable Environment) which undertakes regional
    and local riparian habitat restoration to benefit significant aquatic
    resources. To date over $55 million in Federal grants have been awarded
    to address aquatic resources issues in the south eastern part of
    Kentucky.
        The NOAA Restoration Center coordinates with the Damage Assessment
    Center and the Office of General Council to assist in the development
    of a proposed Regional Restoration Planning Program for Louisiana on a
    state-wide basis that addresses natural resource injuries caused by oil
    spills. The planning program is intended to increase efficiency and
    effectiveness in addressing restoration needs for small injury cases.
        The NOAA Restoration Center is home to the Community-Based
    Restoration Program (CRP) which involves communities in the restoration
    of local marine and estuarine habitat. Partnerships with Federal
    agencies, states, local governments, non-governmental and non-profit
    organizations, businesses, industry and schools have helped over 170
    local efforts restore coastal habitat. The NOAA Restoration Center and
    its partners provide funding and expertise to numerous coastal
    community projects that promote coastal stewardship and develop a
    conservation ethic. Through partnerships, the CRP has been able to
    leverage $4-$10 for every Federal appropriated dollar. These
    partnership are implemented at the national, regional and local levels.
    In the fiscal year 2000, a partnership with Restore America's Estuaries
    and the NOAA Restoration Center initiated the development of a National
    Coastal Restoration Strategy to further improve the effectiveness of
    this and other regional restoration programs. The CRP began with an
    investment of $250,000 in 1996, increased to $2 million in fiscal year
    2000 and is being implemented with an appropriation of $8 million in
    fiscal year 2001.
                Exxon Valdez Oil Spill Restoration Center
        The NMFS Exxon Valdez Oil Spill Restoration Center, housed in the
    Alaska Fisheries Science Center assists the Exxon Valdez Oil Spill NRDA
    Trustee Council in implementing projects valued at over $700 million to
    restore significant coastal habitat damaged from the oil spill. The
    funds are principally targeted at land acquisition to preserve high
    priority coastal resources and the understanding the long-term natural
    resource injuries and the associated recovery processes.
                Pacific Salmon Recovery Fund
        NMFS staff from the Alaska, Northwest, and Southwest Regional
    Offices are assisting the States of Alaska, Washington, Oregon, and
    California and regional tribes in implementing restoration under the
    Pacific Coastal Salmon Recovery Fund (PCSRF). Congress appropriated $58
    million in fiscal year 2000 to be used for salmon habitat restoration,
    salmon stock enhancement, salmon research, and implementing the Pacific
    Salmon Treaty Agreement and related agreements. The $58 million PCSRF
    appropriation was distributed as follows: $50 million to the states
    ($18 million for Washington, $14 million for Alaska, $9 million for
    Oregon, and $9 million for California), $6 million to Pacific coastal
    tribes, and $2 million for Columbia River tribes. Fiscal year 2001
    funding in support of the PCSRF is $74 million.
                South Central Florida Restoration Initiative
        The NMFS Southeast Fisheries Science Center supports the $500
    million South Central Florida Restoration Initiative (Everglades
    restoration). This Federal and State partnership is aimed at restoring
    significant national fish and wildlife resources and the Everglades
    ecosystem that supports them. NMFS support includes restoration methods
    research and monitoring ($401,000), technical program oversight
    ($450,000), and education/outreach of ecological restoration principles
    and practices ($130,000).
                Support for Restoration: Funding, Technical Assistance, and
                        Information
        The NOAA Chesapeake Bay Office (NCBO) supports the Chesapeake Bay
    Program, a unique regional partnership aimed at restoring the
    Chesapeake Bay ecosystem. A major component of Bay restoration includes
    reestablishing once abundant oyster populations which have value as
    harvestable resources as well as habitat for living marine resources
    and water quality enhancement. Towards this end, the NCBO administers
    the Oyster Recovery Program, a cooperative effort with Bay waterman to
    replant over-fished beds and address critical issues related to
    successful oyster restoration, including the importance of oyster
    sanctuaries, benefits of protecting historically productive areas and
    the importance of reef design. The Oyster Recovery Program received
    $850,000 for fiscal year 2001.
        The five NMFS Science Centers each conduct local programs of basic
    research on the structure and function of coastal ecosystems. This
    includes evaluating restoration techniques on such diverse habitats as
    salt marshes, seagrasses, coral reefs, and riverine systems important
    to salmon. In fiscal year 2001, NMFS will spend about $2-$3 million in
    restoration related research.
    National Ocean Service (NOS)
                Response and Restoration Programs
        NOAA's Office of Response and Restoration (OR&R) protects and
    restores coastal ecosystems threatened or harmed by releases of oil and
    hazardous substances and other environmental disturbances, such as ship
    groundings. OR&R uses sound science and effective partnerships with
    other NOAA components, other government agencies, industries, and the
    public to accomplish its legislative mandates under CERCLA, the Oil
    Pollution Act (OPA), the Clean Water Act, and the National Marine
    Sanctuaries Act. OR&R houses the Damage Assessment Center (DAC), part
    of NOAA's Damage Assessment and Restoration Program (DARP) that is
    described in the NMFS portion of this answer. OR&R:
        Responds to over 100 oil and hazardous materials spills and other
    incidents in the coastal and marine waters each year. OR&R uses the
    best available scientific information and technologies to improve
    response strategies at these incidents, setting the stage for effective
    and efficient habitat restoration.
      --Restores coastal natural resources by improving recovery and
            expediting restoration at coastal waste sites (intervening
            successfully at more than 500 sites since 1984).
      --Restores coastal natural resources directly by providing funding
            for restoration projects through settlements of liability under
            CERCLA and OPA (both as part of the Damage Assessment and
            Restoration Program and through comprehensive government
            settlements with EPA).
      --Implements restoration, develops restoration plans, monitors
            projects to ensure success, and promotes regional restoration
            planning to maximize benefits of individual projects on a
            broader scale (for example, as a leader in funding and
            developing the first ever National Strategy for Coastal Habitat
            Restoration).
      --Supports coastal managers to build state and local capabilities to
            protect and restore our coasts through technology transfer and
            training and by providing tools and information that can be
            directly applied to improve restoration planning and
            implementation.

                            [In millions of dollars]

    OR&R Funding for Restoration:
        Base funding for fiscal year 2001 focused on restoration......   7.0
        Expected settlement funding for restoration in fiscal year
          2001 \1\....................................................  48.5
        CERCLA funding through EPA....................................  2.45

    \1\ OR&R has collected and used $313 million in settlement funds to
    restore coastal habitat since its restoration programs were initiated.
    ---------------------------------------------------------------------------
                The National Marine Sanctuary System
        The National Marine Sanctuary System (NMSS) is involved in habitat
    restoration at many of its sites. The National Marine Sanctuaries Act
    allows the program to recover funds for restoration from those parties
    responsible for injury to sanctuary resources. In addition to
    restoration efforts funded by its base appropriation, NMSS uses damage
    assessment settlement funds from specific cases to support actual
    restoration project implementation.

    NMSS Funding for Restoration:
        Base funding for fiscal year 2001 focused on restoration..  $300,000
        Settlement funding for restoration in fiscal year 2001 \1\   350,000

    \1\ NMSS settlements vary by year, ranging from approximately $2 million
    in fiscal year 1999 to $350,000 in fiscal year 2001.
    ---------------------------------------------------------------------------
                National Estuarine Research Reserve System
        The National Estuarine Research Reserve System (NERRS) conducts a
    small amount of restoration work through the Reserve system and the
    Cooperative Institute for Coastal and Estuarine Environmental
    Technology (CICEET), an innovative partnership between the National
    Ocean Service and the University of New Hampshire. NERRS is also
    engaged in a number of activities related to restoration and is
    currently preparing a NERRS Restoration Science Strategy. CICEET
    currently has 12 active projects developing innovative restoration
    technologies and methods for estuarine and coastal ecosystems.

                            [In millions of dollars]

    Base funding in fiscal year 2001 for CICEET restoration activities   2.3
                Support for Restoration: Funding, Technical Assistance, and
                        Information
        The following NOS programs provide funding, technical support,
    data, and other resources that are critical to restoration nationwide:
      --NOAA Coastal Services Center participates in coastal habitat
            restoration through the sponsorship of conferences, the
            development of tools, and the funding of restoration projects.
            CSC partners extensively with the private sector, academia,
            Federal agencies, and other NOAA offices. For example, CSC has
            partnered with the National Marine Fisheries Service's
            Southeast Fisheries Science Center to establish a joint
            collaborative effort at Lafayette, Louisiana, whose primary
            interest is coastal habitat restoration. The amount of funds
            expended each year is variable, but can approach $500,000 per
            year.
      --The Office of Ocean and Coastal Resource Management (OCRM)
            administers the Coastal Zone Management Act (CZMA), a federal
            state partnership for managing the nation's coastal areas.
            Through the CZMA, OCRM provides funding and other support, some
            of which states devote to restoration activities. OCRM also
            administers two new programs: the Great Lakes Coastal
            Restoration Grants Program and the Coastal Impact Assistance
            Program. These are referenced below.
      --The National Centers for Coastal Ocean Science conducts scientific
            research to support agency mandates that require habitat
            restoration. Approximate funding for NCCOS restoration
            activities in fiscal year 2001 is $3.45 million. Such research
            is directed at providing NOAA and state and local managers with
            new and advanced restoration protocols and tools, as well as
            monitoring and assessment techniques and strategies, and the
            development of success criteria for multi-year restoration
            activities.
      --The National Geodetic Survey (NGS) plans and conducts highly
            accurate vertical control surveys, assisting partners such as
            the U.S. Army Corps of Engineers in conducting coastal habitat
            restoration. In south Florida, leveling surveys will be used
            throughout the Everglades Restoration Project as a baseline for
            determining local water flow patterns. The allocation for 2001
            is $469,000.
      --The Center for Oceanographic Products and Services provides the
            accurate water level information critical to successful
            restoration. COOPS generates tidal elevation data through its
            nation-wide network of tide gauges and, in many major port
            areas, Physical Oceanographic Real Time Systems (PORTS). COOPS
            is also collaborating with other NOS and NOAA programs, with
            state and local agencies, and with the private sector to
            develop new techniques for integrating tidal elevation
            information into local restoration projects.
                Specific directed restoration grant programs
        In fiscal year 2001, NOS also had a number of directed projects
    that provided funds to outside recipients for restoration activities.
    Most of these are short-term efforts and are not included in the fiscal
    year 2002 President's request. These include:
      --Great Lakes Coastal Restoration Grants Program (GLCRGP).--There is
            approximately $29.9 million under the GLCRGP available to
            states and coastal communities to support the legislative
            purpose of protecting and restoring Great Lakes coastal
            resources and water quality.
      --Brown Marsh Grant Program.--$3 million grant to the Louisiana
            Department of Natural Resources for science studies and
            restoration and remediation efforts focused on the large marsh
            die back in the state.
      --New Hampshire Marsh Restoration.--$1 million for several new and
            on-going salt marsh restoration projects.
      --River Restorations.--$11.5 million grants for restoration projects
            along the DuPage River, Illinois, and the Detroit and Lower
            Rouge Rivers in Michigan. These projects will provide for
            study, characterization and restoration efforts along these
            three rivers.
      --National Fish and Wildlife Foundation Grants.--Part of the $2
            million provides resources for some small-scale restoration
            projects. (This is requested to continue at a level of $2
            million in fiscal year 2002--$1 million each in NOS and NMFS.)
      --Some small portion of the Coastal Impact Assistance Program (CIAP)
            may also be made available for restoration projects in the
            seven states that will receive these grants (Alaska,
            California, Texas, Louisiana, Alabama, Mississippi, and
            Florida).
    Office of Oceanic and Atmospheric Research (OAR)
                National Sea Grant College Program
        In fiscal year 2001 to date, NOAA's Sea Grant College Program
    awarded $2.339 million of their funding (plus $1.5 million in matching
    funds from the grantees) for habitat related research. Of that amount,
    $2.2 million ($1.4 million matching) went to habitat structure and
    function; $139,000 ($115,000 matching) was awarded to habitat
    restoration research.
        Question. How is NOAA coordinating these habitat restoration
    efforts to ensure the most efficient and effective use of its
    resources?
        Answer. NOAA's offices and programs cooperate on restoration at a
    number of levels. The Damage Assessment and Restoration Program (DARP)
    is a cooperative program among the National Marine Fisheries Service's
    Office of Habitat Conservation, National Ocean Service's Office of
    Response and Restoration, and NOAA's General Counsel for Natural
    Resources to address the coastal impacts of oil and chemical spills and
    releases, as well as the physical damage resulting from events such as
    ship groundings. Through DARP, NOAA scientists, economists, and
    managers participate in the evaluation of damage to coastal resources,
    development of restoration plans, and implementation and monitoring of
    restoration projects.
        To implement the Estuary Restoration Act, NOAA has established a
    ``Secretariat,'' a cross-line office body that will assure that NOAA
    expertise, tools, and databases are efficiently and effectively applied
    to coastal restoration throughout the United States and the
    protectorates.
        Coordination also occurs between offices in instances such as the
    restoration of damage to NOAA's protected resources. For example,
    scientists and managers from NOAA's Marine Sanctuary System and the
    DARP collaborate to design, implement, and monitor coastal habitat
    restoration projects within the sanctuaries. Informal coordination and
    cooperation is very common throughout the country, with staff from the
    line offices working together on all aspects of coastal habitat
    restoration. In order to capitalize on the extensive regional-level
    interaction, a NOAA-wide restoration workshop was held to discuss means
    of facilitating communication across the NOAA restoration community and
    to continue to improve the agency's ability to restore coastal
    habitats. An outgrowth of this workshop was the NOAA Restoration
    Network, which provides electronic communication for the diverse and
    widespread employees of NOAA and its partners to share information and
    assist one another in the more efficient completion of restoration
    activities.
        Question. Does NOAA have a comprehensive habitat restoration plan?
        Answer. NOAA funded the development of a National Strategy for
    Coastal Habitat Restoration through Restore Americas Estuaries (RAE), a
    consortium of all of the major non-governmental organizations involved
    in estuary restoration, in fiscal year 2000. RAE identified, evaluated,
    and synthesized existing restoration plans and programs to form the
    foundation of a national strategy for restoration. The strategy will
    identify a common set of restoration principals, goals, objectives,
    monitoring protocols and priority setting methods to increase
    effectiveness and efficiency of ``on-the-ground'' restoration
    activities. The strategy is intended to assist both NOAA and other
    Federal agencies in undertaking restoration activities.
        Question. Would such a plan make better use of the integration
    between offices?
        Answer. NOAA and RAE hope that the National Strategy for Coastal
    Habitat Restoration will provide a common a framework for the
    integration of restoration programs and activities at the national and
    regional levels, both within NOAA and outside of NOAA. NOAA believes
    that the strategy's development along with the improved communication
    and coordination through such mechanisms as the Restoration Network and
    the creation of the Secretariat under the Estuaries Restoration Act
    will provide a comprehensive approach to restoration planning, and
    implementation that should lead to improved use and integration of NOAA
    conducted restoration activities. It will also promote federal, state,
    local, and private cooperation and leverage these efforts to contribute
    to successful restoration based on needs and priorities established at
    the regional level.
        Question. NOAA is asking for $2 million in fiscal year 2002 to
    implement the Estuary Restoration Act. What is NOAA's role in the Act
    and how will NOAA spend this funding?
        Answer. The Estuary Act assigns specific responsibilities to NOAA,
    including:
      --Developing monitoring protocols for restoration projects, including
            standards for data collection and frequency of monitoring
            efforts;
      --Developing and maintaining a database of information on all
            projects carried out under the Act, including progress toward
            achieving the restoration goals;
      --Compiling and making available relevant information on estuary
            restoration to assist in successful and efficient restoration
            efforts; and
      --Enhancing monitoring and research capabilities through NERRS and
            CICEET to ensure the use of sound science and encourage
            innovative technologies.
        The $2 million request will help fund these activities through
    existing programs.
        In addition to the legislative mandates above, NOAA has been
    identified in the Estuary Restoration Act as a member of the Estuary
    Habitat Restoration Council. Council membership will include
    participating in the setting of goals for the program, evaluation of
    proposed projects, development of a national restoration strategy, and
    collaborating with non-Federal partners to implement projects.
        NOAA's National Estuarine Research Reserve System (NERRS) and
    Cooperative Institute for Coastal and Estuarine Environmental
    Technology (CICEET) were specifically identified as participating in
    the development of innovative restoration technology.
                               fisheries vessels
        Question. I am concerned that as NOAA's fisheries research vessels
    are pushed into proposed future budget requests that the cost per
    vessel will increase. As you know, the NOAA fleet is aging and many of
    the NOAA vessels must be replaced. Why wasn't the second fisheries
    vessel included in the budget request? Will you support its funding if
    we find resources for it? Can you assure me that next year we will see
    the third vessel in budget request?
        Answer. Delaying funding for the second Fishery Research Vessel
    (FRV) to fiscal year 2003 delays the production schedule one year. The
    production design of the first FRV did not begin until last month, 6
    months later than anticipated. This pushes back construction of the
    first vessel to fiscal year 2002. Designing and constructing the second
    FRV in fiscal year 2003 would allow the second vessel to benefit from
    some lessons learned in constructing the first one, but does not
    provide continuity for the workforce to transition from one hull to the
    next. Funding two ships in fiscal year 2003 or fiscal year 2004 saves
    approximately $1 million over consecutive year funding and might still
    allow for calibration with retiring ships, thus preserving the validity
    of decades of time series data.
        The construction contract (signed this year) for the new Fisheries
    Research Vessel funded by the fiscal year 2000 and fiscal year 2001
    budgets, includes options to build three additional vessels. The
    Department is committed to replacing the aging NMFS fleet to assure
    continuity of NOAA's mission.
                                     ______

                   Questions Submitted by Senator Ted Stevens
                             marine protected areas
        Question. Will Executive Order 13158 regarding ``marine protected
    areas'' impact any rulemaking or other regulatory activity specifically
    authorized by Congress through the Magnuson-Stevens Act, the Marine
    Mammal Protection Act, and other laws? If so, please describe the
    process.
        Answer. With the exception of Clean Water Act authorities of the
    Environmental Protection Agency (see below), Executive Order 13158 does
    not promulgate of new regulations, make existing MPAs more restrictive,
    or establish new MPAs. The Executive Order does not supplant existing
    statutory authorities or create new legal authority to regulate marine
    resources and activities conducted under this Order will be consistent
    with current law. It tasks NOAA with providing information and services
    on existing MPAs, and leaves all management and establishment of MPAs
    with the agencies who have existing authorities. Any actions by these
    authorities, including rulemaking or other regulatory activity, to
    modify existing MPAs or establish new MPAs are subject to all of the
    currently existing and applicable laws, regulations, etc. This includes
    National Environmental Policy Act requirements for impact assessments,
    public notice and public review.
        The following proposed regulation was published in the Federal
    Register by EPA in early fiscal year 2001 and is currently under
    review.
        Section 4(f) of the Executive Order states ``To better protect
    beaches, coasts, and the marine environment from pollution, the
    Environmental Protection Agency (EPA), relying upon existing Clean
    Water Act authorities, shall expeditiously propose new science-based
    regulations, as necessary, to ensure appropriate levels of protection
    for the marine environment. Such regulations may include the
    identification of areas that warrant additional pollution protections
    and the enhancement of marine water quality standards. The EPA shall
    consult with the Federal agencies identified in subsection 4(a) of this
    order, States, territories, tribes, and the public in the development
    of such new regulations.''
                      authorizations for marine activities
        Question. Is it NOAA's position that existing laws regarding
    activities in the marine environment, including the Magnuson-Stevens
    Act, the Marine Mammal Protection Act, the Coastal Zone Management Act,
    and other laws, do not provide sufficient authority for NOAA to carry
    out its mission?
        Answer. NOAA believes that the existing legal authorities
    mentioned, as well as the Endangered Species Act, National Marine
    Sanctuaries Act, and other laws, do indeed provide sufficient authority
    for NOAA to carry out its mission. However, the independent application
    of these authorities for the distinct purposes of each statute may
    still leave gaps in the conservation and management of marine
    resources, particularly from an ecosystem perspective. The MPA
    Executive Order promotes improved coordination among key Federal
    agencies involved in management of marine areas and provides for the
    development of better information and tools to enhance the benefits of
    existing authorities.
                         cost for executive order 13158
        Question. Please provide the Committee with a full accounting of
    all costs and expenses, including FTE's, that NOAA has incurred in its
    implementation of Executive Order 13158 to date, and the expected costs
    through the end of fiscal year 2001.
        Answer. In fiscal year 2000, NOAA spent approximately $312,000 to
    support the tasks defined in the Marine Protected Areas (MPA) Executive
    Order. The equivalent of 2 FTEs were involved in this effort from June
    through September 2000. Estimated expenses for fiscal year 2001 are 2
    FTEs and $490,000. These funds are planned for expenditure as follows:
        1. Inventory/Website/Library.--$125,000 funds contracts with state
    organizations to assist in the collection of information about state
    protected areas.
        2. Outreach/Education/Federal Advisory Committee.--$157,000
    supports the first Advisory Committee meeting, provides for the
    preparation of educational and public information materials, sponsors
    two meetings with MPA stakeholders, and enables NOAA to conduct an MPA
    education workshop with Sea Grant, National Estuarine Research Reserve,
    National Marine Sanctuary, zoo, and aquarium staff.
        3. National Center and Institutes for Marine Protected Areas.--
    $208,000 supports activities of the National Center and its Science and
    Training/Technical Assistance Institutes including conduct of MPA
    natural and social science strategy workshops and regional coordination
    workshops.
                                     ______

                Questions Submitted by Senator Daniel K. Inouye
                            highly migratory species
        Questions. NOAA's fiscal year 2002 budget request includes a new
    program for the West Coast of the United States to research and manage
    highly migratory species. The budget request also includes funds for
    the Joint Institute of Marine and Atmospheric Research (JIMAR) to
    continue ongoing research and related management of highly migratory
    species in the Western, Central and South Pacific. While I recognize
    that there are some species of distinct importance to each region,
    given the nature of highly migratory species, there are also species
    which the two regions have in common. What is NOAA doing to ensure
    coordination between the West Coast and Pacific region programs and to
    avoid duplication of effort and jurisdictional conflicts?
        Answer. The Pacific Highly Migratory Species initiative was
    developed to deal with management information needs arising from the
    purse seine fisheries operating under the existing Tuna Treaty, the
    developing Multi-lateral High Level Conference on the Management of
    Highly Migratory Species in the Pacific Ocean (MHLC Treaty), as well as
    the Inter-American Tropical Tuna Commission (IATTC). A preliminary
    spending plan for the $1 million proposed in the President's fiscal
    year 2002 request is outlined below and focuses on the new scientific
    research and monitoring that will be undertaken. While the Southwest
    Fisheries Science Center's La Jolla Laboratory has responsibility for
    these purse seine fisheries and so would be the beneficiary of this
    proposed increase, the Center's Honolulu Laboratory would share
    significantly in other Presidential fiscal year 2002 requests,
    including the Expanded Stock Assessment Initiative and Sea Turtle
    Recovery Activities, as well as receiving directly funds for the
    Adventurous Refit and Honolulu Laboratory Renovation Planning.
                Preliminary Spending Plan
        Economic assessments of purse seine fisheries, including capacity
    issues--$0.150 million.
                  commerce jurisdiction over marine resources
        Question. A debate continues on the issue of which Federal
    department has jurisdiction over marine resources between 3 to 200
    miles. This issue was at the core of efforts during the previous
    Administration to establish an area of protection around the coral
    reefs in the Northwestern Hawaiian Islands. Initially, the Department
    of the Interior sought to extend its existing wildlife refuge out to 12
    miles, or in the alternative to establish a national monument. During
    this debate, the Justice Department's Office of Legal Counsel issued a
    legal opinion which called into question the Department of the
    Interior's authority to exert jurisdiction beyond the 3 miles from
    shore.
        The Department of the Interior continues to exert management
    authority over marine resources beyond 3 miles from shore. The most
    recent examples are the Fish and Wildlife Service's establishment of
    refuges at Kingman Reef and Palmyra Atoll which extend out to 12 miles
    from shore. What is the Department of Commerce doing to protect its
    management jurisdiction over marine resources within the 3 to 200 mile
    zone?
        Answer. The NOAA Office of General Counsel has responded:
        The Department of Commerce is the primary management authority for
    living marine resources, including fish and corals, in federal waters
    and the underlying seabed and subsoil, pursuant to its authorities
    under statutes including the Magnuson-Stevens Act, the National Marine
    Sanctuaries Act, the Marine Mammal Protection Act, and the Endangered
    Species Act.
        DOC regards its authority and jurisdiction under these laws as
    unaffected by the wildlife refuges around Kingman Reef and Palmyra
    Atoll. The Western Pacific Fishery Management Council has established
    fishery management plans that include the territorial sea around
    Kingman Reef and Palmyra Atoll and the Department gives full effect to
    its regulations for these fishery management plans. The Department also
    continues fully to exert its management authority and jurisdiction
    around Kingman Reef and Palmyra Atoll under federal laws including the
    Endangered Species Act (for listed species under its jurisdiction such
    as sea turtles in the marine environment and whales), the Marine Mammal
    Protection Act, and the Lacey Act.
                    northwestern hawaiian islands sanctuary
        Question. The reauthorization of the National Marine Sanctuaries
    program enacted last year authorized the Commerce Department to
    initiate a sanctuary designation process for the Northwestern Hawaiian
    Islands. This legislation also authorized the President to establish an
    interim coral reef reserve during the pendency of the sanctuary
    designation process. The clear intent of the Congress was that upon
    completion of the sanctuary designation process, the critical areas
    around the Northwestern Hawaiian Islands would be managed as a
    sanctuary. Despite Congress' clear intent, some officials at NOAA are
    taking the position that the sanctuary will overlay the reserve.
    Indeed, timelines prepared by NOAA officials for the implementation of
    the reserve and for the sanctuary show no target dates for the
    transition from a reserve to a sanctuary, implying that the reserve
    will continue indefinitely. What is NOAA's official position on this
    matter?
        Answer. NOAA's official position is that a Sanctuary designation
    process for the Northwestern Hawaiian Islands is underway, and that
    when a Sanctuary is designated as a result of that process, it will
    replace the Reserve.
        Question. If NOAA's position differs from the intent of Congress as
    outlined above, please specify the authority upon which NOAA justifies
    its departure from Congressional intent.
        Answer. NOAA's position does not appear to differ from the intent
    of Congress as outlined above.
                                     ______

                  Questions Submitted by Senator Patty Murray
                  biological opinion for columbia river salmon
        Question. Thank you, Mr. Chairman. And thank you, Mr. Gudes, for
    your testimony. I would like to compliment you on many of the
    initiatives included in NOAA's budget request, such as your emphasis on
    infrastructure and ocean exploration. In many ways, this is a budget
    proposal I can support. I also appreciate your willingness to learn
    more about projects important to Washington state, such as the
    Northwest Straits Initiative. As I mentioned when Secretary Evans
    appeared before the Subcommittee, I strongly support your request to
    maintain funding for the Pacific Coastal Salmon Recovery account and
    the Pacific Salmon Treaty account. But there is a crucial cross-cutting
    issue that I must raise: How does the Administration propose to fund
    the Biological Opinion for Columbia River salmon? The Bi-Op is already
    being challenged by litigation. It is estimated that the Bi-Op will
    cost hundreds of millions of dollars to fully fund. I am also posing
    this question to other Federal agencies, such as the U.S. Fish and
    Wildlife Service, the Army Corps of Engineers and the Bureau of
    Reclamation. But NMFS must play a crucial role as well. How can we get
    a cross-cut budget from relevant Federal agencies detailing the funding
    necessary to implement the Biological Opinion?
        Answer. NOAA and NMFS realize that this is a significant issue that
    is made more critical because of the current drought in the Northwest.
    While NOAA is not currently contemplating a supplemental budget request
    including funding for the Biological Opinion, we will continue to
    review this situation as part of the normal budget development process.
                             permit backlog problem
        Question. On a related issue, I appreciate the progress made
    impartially lifting the hiring freeze. But I am concerned that NMFS
    still doesn't have enough staff in the Northwest Region to adequately
    address the permits backlog caused by ESA consultations. I frequently
    hear about this issue from constituents who are very frustrated with
    how long it takes for them to get permits. Unfortunately, the backlog
    undermines support for protecting endangered species and threatens the
    regional economy. How do you propose to address the permits backlog
    problem in this budget?
        Answer. The NMFS Northwest Regional Office is proceeding to hire 4
    additional staff to address the existing backlog in consultations in
    Puget Sound. Unfortunately, the Corps of Engineers is also facing a
    huge backlog on projects requiring Endangered Species Act
    consultations, and as the Corps addresses their backlog, the demands on
    NMFS consultations increase since many of the actions have been pending
    for months with the Corps. Also, our constituencies have encouraged us
    to devote additional resources to development of Recovery Plans through
    the Shared Strategy arena and to implement the 4d rules for
    municipalities--all of which will add to workload on staff and require
    prioritizing these needs with ESA Section 7 consultations with the
    Corps' backlog on private citizen permit action.
                   agreement between noaa and port of everett
        Question. The Northwest Fisheries Science Center has a research
    facility located on a former U.S. Air Force Tank Farm in Mukilteo,
    Washington, about 30 miles north of Seattle. NOAA is currently working
    with the Port of Everett to incorporate the research center into long-
    term plans for redevelopment. These plans include constructing a
    commuter rail station, upgrading ferry terminals, expanding a marina
    and building commercial space along 22 acres of waterfront property.
        NOAA wants to own a portion of the land instead of leasing it from
    the Port of Everett. The Port will receive the land from the Air Force
    because of legislation I worked to pass last year. I am committed to
    facilitating an agreement amenable to all parties involved. Are you
    aware of this effort and does it have NOAA's support at the highest
    levels?
        Answer. NOAA supports this effort and has been involved with the
    ownership discussions. Representatives from the NMFS Northwest Regional
    Office, the NOAA Facilities Office, the Port of Everett, Senator
    Murray's office and others met on May 4, 2001 to try to resolve
    ownership issues at the Mukilteo tank farm facility. It is our desire
    to own the site rather than lease it because of flexibility in making
    improvements, etc. The Port is amenable to NOAA owning the site. We
    believe this could be accomplished through legislation or through an
    agreement between NOAA and the Port that would result in transfer of
    title to the site immediately upon the Port obtaining title. The two
    sides agreed to develop an option for accomplishing the transfer
    without legislation. Both agreed in principle that the site could
    revert to the Port if NOAA ever abandons it. NOAA plans to continue its
    operations at the site indefinitely. While no specific plans have been
    made for improving the site, we will continue to consider improvements
    within available resources. We will keep you informed of our progress.
                   industry and government buy-back programs
        Question. Last year the omnibus appropriations bill authorized $50
    million for a North Pacific crab vessel and permit buy-back program.
    The West Coast Groundfish recovery plan developed by the Pacific
    Council also includes a buy-back program dependent upon $25 million
    from the Federal Government. Other sectors of the commercial fishing
    industry are also interested in buy-back programs. I realize budget are
    tight, but this is an issue I hear about frequently. I also support
    providing relief to sectors of the industry that are suffering from
    major downturns in the resource. What is your position on government
    and industry funded buy-back programs to address some of the fisheries
    crises currently facing us? And if you can't support buy-back programs
    because of the costs, how do you propose to help crab fishermen in the
    North Pacific and groundfish fishermen along the West Coast in the
    short term?
        Answer. NOAA recognizes the need to reduce capacity in some
    fisheries and that buy-backs is a management tool to reduce capacity.
    The Magnuson-Stevens Act Section 312(b) includes provisions for
    industry funded buy-backs. We have begun the necessary regulatory
    actions to conduct the crab buyout, however, we do not have full
    funding for this program. The total estimated cost for the buyout is
    estimated at $100 million per legislation included in the fiscal year
    2001 appropriation. However, NMFS has only received enough subsidy for
    a $50 million buyback loan. The additional $50 million needed for the
    buyout has not been appropriated, only authorized.
        Likewise, the Pacific Fishery Management Council has determined
    that the West Coast groundfish fishery capacity needs to be reduced by
    at least 50 percent. The Fishermen's Marketing Association has been
    holding meetings along the coast to gage industry interest in a buyback
    program that would involve a combination of government and industry-
    funding. The plan includes the purchase of vessels, all federal
    groundfish permits, and all state permits (shrimp, crab, salmon, etc.)
    assigned to the vessel. The plan includes the purchase of state permits
    to address concerns about groundfish fishermen increasing their effort
    in other fisheries because of the buyback. The plan is based on a
    bidding system that ranks the bids according to the amount of total
    fishing revenue the vessel earned over the 1998-2000 period. The
    industry needs federal funds to help pay for the buyback and for
    establishing a buyback loan. The industry will repay the loan through
    landings fees. A total of $50 million ($25 million direct and $25
    million loan) is needed to fund the buyback. Not only would groundfish
    fishermen be responsible for paying back the loan but shrimp, salmon,
    and crab fishermen would also be responsible as this plan would reduce
    capacity in these fisheries as well.
                         SMALL BUSINESS ADMINISTRATION

    STATEMENT OF JOHN WHITMORE, ACTING ADMINISTRATOR
    ACCOMPANIED BY GREG WALTERS, DEPUTY CHIEF FINANCIAL OFFICER

        Senator Hollings. We will now hear from Mr. John Whitmore,
    Acting Administrator of the Small Business Administration.
        Very good, Mr. Whitmore. Your statement in its entirety
    will be included in the record, and you can summarize or
    deliver it as you wish.
        Mr. Whitmore. Thank you, Senator Hollings, Senator Inouye,
    for inviting me here today to testify.
        I am pleased to present the Small Business Administration's
    budget request for fiscal year 2002. With me today is Greg
    Walters, the Deputy CFO at SBA.
        The budget request of $539 million represents a renewed
    focus on SBA's core programs. It will provide credit, capital,
    and technical assistance to America's small businesses at a
    substantially reduced cost to the taxpayer. It includes $5
    million for SBA's portion of the President's New Freedom
    Initiative to help small businesses comply with the Americans
    with Disabilities Act, and $5 million as part of the Paul G.
    Coverdell Drug-Free Workplace Program.
        The budget also seeks to streamline the agency and
    eliminate duplicative programs.
        The budget proposes funding the SBA technical assistance
    programs at last year's levels, with three exceptions. We are
    proposing to increase funding for the SCORE program by $250,000
    up to a level of $4 million. SCORE is one of SBA's most cost-
    efficient programs and will soon implement an electronic
    delivery system to broaden its reach.
        The Veterans' Business Development Program was not funded
    in 2001 but will receive $750,000 in 2002. The budget proposes
    a funding level of $88 million for the Small Business
    Development Center Program, $75.8 million coming from
    appropriations and $12 million in fees. Some SBDCs already
    impose a variation on the counseling fee by requiring new
    start-up businesses to take their training courses at a cost of
    $35 to $45 before receiving counseling. This is also in line
    with other SBA technical assistance programs such as the
    Women's Business Center program.
        Charging a modest fee of under $11 an hour will maintain
    the current service levels while reducing the cost to the
    taxpayer.
        The budget proposes funding the Government contracting
    assistance programs at the 2001 level, but does include
    $500,000 for a Women's Contract Initiative and a contract
    bundling study.
        The budget fairly demands that those who benefit most from
    SBA programs share in its cost. In the exact language of the
    President's budget, ``These programs will become self-financing
    by increasing fees. The budget acknowledges that some small
    businesses may have trouble accessing private capital in the
    absence of a Government guarantee but does not require the
    Government to subsidize the cost of borrowing. The budget
    increases fees sufficiently to make these programs self-
    financing and would save $141 million.'' This will reduce the
    burden on appropriations, will allow for expanded program
    levels, and is fair to the taxpayer.
        The budget also proposes increasing fees for the Small
    Business Loan Program and the Small Business Investment Company
    Program. In the Small Business Loan Program, the budget raises
    fees for small business loans above $150,000. There is no fee
    increase for loans made under $150,000 benchmark, and we will
    continue a rebate to the lender.
        We hope this will encourage small loans to those who are in
    the start-up phase. This will also serve to provide capital to
    those most in need and will support a zero subsidy rate.
        The new administrator faces many challenges once confirmed.
    Two principal, large-scale challenges include antiquated
    programs and delivery systems that are out of touch with
    today's dynamic small business environment and resource and
    personnel questions. SBA needs to transform itself into an
    entity that is governed by efficiency, flexibility, and the
    empowerment of small business through knowledge.
        More specifically, within the SBA loan program, the number
    of loans has decreased by 21 percent between the period of 1995
    and 2000, while the dollar volume has increased 26 percent.
    While the dollar volume has increased, the Small Business Loan
    Program suffers from lack of reach. Larger loans have gone to
    fewer companies. This is where the program faces its biggest
    challenge. Cultivating businesses in their initial stage of
    growth is crucial to advancing America's small business
    community. This is where SBA should focus its attention. This
    is true gap lending.
        The fastest-growing groups in America's small business
    community are Hispanic and women-owned businesses. These
    groups, along with African Americans, Native Americans, and
    veterans, are also the most underrepresented in SBA's Small
    Business Loan Program. While the volume to Asian Americans went
    up significantly, loan volume to women, veterans, and other
    minorities has been flat or trending down.
        Another major challenge facing us is the need to focus on
    the current organizational and functional structure of SBA.
    This challenge has been exacerbated in recent months by the
    hiring in the November-January time period without regard to
    the agency's top priorities--the small business investment
    company, loan monitoring, and lender oversight
    responsibilities.
        I would also like to address the SBA Loan Monitoring
    Project which was authorized in December of 1997. I have
    concluded that the congressionally-mandated loan monitoring
    system has become commingled with an internally-sought Systems
    Modernization Initiative where cost and time lines for
    implementation have risen significantly. I have since directed
    that the program be refocused on activities for which Congress
    authorized and appropriated.

                               prepared statement

        With this in mind, we have signed a contract with KPMG to
    provide us with expertise in assessing available options. Other
    efforts of the modernization effort will wait until the loan
    monitoring system is fully operational.
        Thank you. I will be pleased to answer any questions.
        [The statement follows:]
                      Prepared Statement of John Whitmore
        Mr. Chairman, Ranking Member Hollings, and members of the
    committee, thank you for inviting me here today. I am pleased to
    present the U.S. Small Business Administration's (SBA) budget request
    for fiscal year 2002. This request of $539 million signals a renewed
    focus on SBA's core programs and a commitment to do them well. It will
    provide record levels of credit, capital, procurement, and
    entrepreneurial development assistance to America's 25 million small
    businesses at one of the lowest costs to the taxpayers ever. This is a
    fiscally sound budget request that will provide more than $17.5 billion
    in loans and guarantees, and counseling and training assistance to over
    1 million firms and entrepreneurs, to help them start, sustain and grow
    their businesses.
        As I said, this budget request will allow us to focus on our core
    programs and delivering them to those who need them most. The
    proliferation of new programs at the SBA has come at a cost of diluted
    focus and lack of attention to our bread and butter programs. We are
    concerned with the recent performance of key programs, such as our 7(a)
    loan, 8(a) business development assistance, and HUBZone programs. We
    are concerned that neither our programs nor our delivery structure are
    ready to serve small business needs in 2002 and beyond. We will present
    the Administrator, upon his confirmation, with an array of decision
    options to address these and other concerns.
                         financial assistance programs
        President Bush's budget will provide SBA's Financial Assistance
    Programs with a record level of financial support to our nation's small
    businesses--$17.5 billion. SBA's 7(a) Loan Guaranty Program, SBA's
    primary loan program, will support $10.7 billion in lending while
    saving the taxpayers $114.5 million. The savings will be accomplished
    by increasing the tax-deductible fees to those who benefit from the
    larger loans in the 7(a) program and to those Small Business Investment
    Companies using participating securities. However, loans of $150,000
    and less will have no change in their fees. In fiscal year 2000, of the
    43,748 total number of 7(a) loans, approximately 60 percent were under
    $150,000. For specific groups of borrowers, loans under $150,000 made
    up: 69 percent of the 2,000 loans to African Americans, 58 percent of
    the 5,359 loans to Asians, 65 percent of the 3,221 loans to Hispanics,
    81 percent of the 525 loans to Native Americans, 69 percent of the
    4,809 loans to veterans, and 74 percent of the 9,206 loans to women.
        From fiscal year 1995 through fiscal year 2000, the number of SBA
    7(a) loans dropped from 55,591 to 43,748, while the dollar volume of
    loans increased from $8.26 billion to $10.5 billion. The number of
    loans to Asian-Americans went up dramatically, but for Native
    Americans, other minorities, women and veterans, loan numbers have
    remained level or gone down slightly--even though businesses owned by
    Hispanics and women were the fasting growing segments of the business
    community.
        In an effort to encourage more of these smaller loans, the
    President's proposal makes no change in fees for loans under $150,000.
    The proposal aims to encourage the smaller loans that many banks are
    reluctant to make, which are the ones that help the neediest of small
    businesses.
        Finally, eliminating the need for appropriations will ensure that
    the 7(a) Program will not run out of money if there is a significant
    increase in demand, an approach that has worked well for other SBA
    programs.
        The 504 Certified Development Company Program provides financing
    for major fixed assets. The program will provide $3.75 billion in
    lending in fiscal year 2002, the same as fiscal year 2001, with a
    slight decrease in the fee paid by the users of the program. This
    program has not had a subsidy from taxpayers since fiscal year 1996.
    The 7(a) proposal is based on the 504 model.
        Through the Microloan Direct Program, SBA provides small loans up
    to $35,000 to small businesses through a network of locally based not
    for profit intermediary lenders. The fiscal year 2002 budget will
    provide $20 million for new loans to intermediary lenders. The average
    loan to microborrowers in this program is $10,500 and over the last
    five years the average number of microloans made each year has been
    around 1,500. Small businesses in economically distressed urban and
    rural areas have benefited from this program. The Microloan technical
    assistance aspect of the program will also receive $20 million in
    fiscal year 2002. These funds will be used to support technical
    assistance to microborrowers, increasing their chance of success and
    enhancing their ability to repay their loans. Training and other
    technical assistance will also be funded to help additional
    microbusinesses obtain financing from sources outside SBA.
        The program level for the Small Business Investment Company (SBIC)
    Program, a venture capital investment program, will increase to $3.1
    billion in fiscal year 2002, an increase of $600 million over fiscal
    year 2001. With a small increase in fees for participating securities,
    the SBIC Program, including the debentures program, will be fully self-
    supporting. I note that the National Association of Small Business
    Investment Companies accepts this approach because it allows for a
    larger program volume.
        The Surety Bond Guarantee Program guarantees bid, performance, and
    payment bonds for small business contractors working on construction,
    service and supply contracts for public and private sector projects.
    The program will be level funded at $1.7 billion and does not require
    taxpayer funds.
                  counseling and technical assistance programs
        The budget provides $5 million as SBA's share of the President's
    New Freedom Initiatives. The funds will provide technical assistance to
    help small businesses comply with the Americans with Disabilities Act
    (ADA) and hire more people with disabilities. This funding will also
    help SBA increase awareness and promote use of the Disabled Access
    Credit, which provides a 50 percent tax credit on up to $5,000 of
    eligible expenses annually to help small businesses make their
    facilities ADA compliant.
        The budget includes funding for the Paul D. Coverdell Drug-Free
    Workplace Program that awards grants to organizations helping small
    businesses establish drug-free workplace programs. This is part of the
    President's initiative to combat drug abuse. To date, SBA has not been
    able to meet the demand for assistance from intermediary partners. For
    example, in 1999 SBA received 160 grant applications from
    intermediaries, but issued only 16 grants. To help meet this need, the
    President's budget includes $5 million and proposes to spend $25
    million over the next five years.
        Business Information Centers (BICs) provide both counseling and
    information for start-up and early operating businesses. There are 70
    locations nationwide in both distressed and non-distressed areas. The
    program will be level funded at $500,000.
        One Stop Capital Shops (OSCSs) provide financial and business
    assistance to small businesses. Located in 22 socially and economically
    disadvantaged areas nationwide, OSCSs will be level funded at $3.1
    million.
        Small Business Development Centers (SBDCs) provide management and
    technical-assistance. This 21-year old program has slowly evolved as a
    counseling program for more mature businesses, not start-up businesses,
    although SBDCs do counsel some start-ups.
        SBDCs will receive $76 million in fiscal year 2002, plus $12
    million through the collection of nominal fees-for-counseling, as is
    currently done for training. After the initial first free hour, the
    estimated cost will be $10.75 per hour. The average use of counseling
    is 5.3 hours, which means clients will pay on average $46.23 for
    counseling. The fee proposal will allow the program to continue to grow
    while reducing the expense to the taxpayers. Currently the average SBDC
    counseling case costs Federal and state taxpayers approximately $700.
        Charging fees is not precedent setting. SBDCs have always charged
    fees for training and other services, such as publications and
    conferences. Some SBDCs already impose a variation on a counseling fee
    by requiring new start up businesses to take their training course, at
    a cost of $35 to $45, before receiving any counseling. During 1998 (the
    latest year that figures are available), SBDCs generated over $7
    million of program income over and above their Federal and matching
    funds.
        Beneficiaries of most SBA programs pay fees, directly or
    indirectly, including fees for loan programs, investment capital, pre-
    qualification counseling. Even some of our small Women's Business
    Centers charge fees in excess of $50 per hour for counseling.
        In fiscal year 2000, the SBDCs trained 326,000 clients and
    counseled 262,000 clients. From fiscal year 1995 to fiscal year 2001,
    SBDCs funding increased $14 million while funding for SCORE only
    increased $500,000 and funding for 7(j), a technical assistance program
    for all low income areas as well as 8(a), was reduced by $4.5 million.
        For the Service Corps of Retired Executives (SCORE), we are
    proposing to increase to $4 million the amount to help pay the expenses
    of the 11,400 SCORE volunteers. These volunteers counseled and trained
    over 377,000 clients in fiscal year 2000. SCORE is making more and more
    use of electronic means to be able to use its expert counselors
    anywhere in the country.
        A recent Washington Post article recounted how SCORE counselors
    Gene Rosen and Herbert Robinson helped Sarah Hill start an antique
    business in Alexandria, Virginia by providing invaluable assistance on
    many aspects of their business, from negotiating the lease to pricing
    merchandise. The time and advice of these volunteers was free. The
    government paid 34 cents a mile for their expenses. Sarah is projecting
    annual sales of over $100,000 in each of the next several years.
        The SBIR (Small Business Innovation Research) Program awards grants
    or contracts to small businesses for their innovative ideas to meet the
    specific research and R&D needs of the federal government. SBA's budget
    will provide $5 million in fiscal year 2002 to fund two programs to
    help small businesses compete for SBIR awards. The FAST (Federal and
    State Technology Partnership) will receive $3.5 million under this
    proposal. The SBIR Technical Assistance Outreach Program will receive
    $1.5 million.
        A nationwide network of U.S. Export Assistance Centers (USEACs)
    combine in single locations the trade-promotion and export-finance
    assistance of the SBA with the programs of the Department of Commerce
    and the Export-Import Bank. USEACs will be level funded at $3.1
    million.
        The Veteran's Business Outreach Program will receive $750,000 in
    fiscal year 2002. The program ensures that small businesses owned and
    controlled by eligible veterans have access to entrepreneurial
    training, business development assistance, counseling and management
    assistance. The program was not funded in fiscal year 2001. The
    Veterans Business Development Corporation, which was funded at
    $4,000,000 in fiscal year 2001, will no longer be funded through SBA's
    budget, but will have its own separate appropriation.
        Women's Business Centers (WBC) provide women entrepreneurs with
    business training and counseling, technical assistance, mentoring, and
    access to SBA's programs and services. The centers also have programs
    to assist economically and socially disadvantaged women, especially
    those on welfare. Each center tailors its services to the needs of the
    local community. SBA awarded 15 new grants, funded 62 centers with
    regular grants, and provided sustainability grants to seven centers
    with its fiscal year 2001 appropriation of $12 million. In fiscal year
    2002, the budget request is for $12 million.
        The Women's Council supports programs and research on behalf of
    women's business enterprise. In the President's Budget, the Council
    will receive $750,000 in fiscal year 2002.
        In fiscal year 2000, women business owners received only 2.8
    percent of Federal procurement dollars. The Office of Federal Contract
    Assistance for Women Business Owners (CAWBO) was established within
    SBA's Office of Government Contracting to increase the number and size
    of federal contracts to women business owners. Additionally, the Office
    of Government Contracting is charged with providing studies on how
    contract bundling affects all small businesses. We request $500,000 to
    implement a recently-enacted procurement initiative, including
    conducting a legislatively mandated study on women's procurement,
    creating a contract bundling database, and conducting analysis of
    procurement trends and practices.
        The 8(a) Business Development (BD) Program assists the development
    of small companies owned and operated by socially and economically
    disadvantaged individuals. Eligible companies may be awarded set-aside
    federal contracts and other business development assistance. The number
    of contracts in this program has gone down. The new Administration is
    looking at ways to more efficiently and effectively run this program.
    In the interim, funding for fiscal year 2002 is requested at the same
    level as fiscal year 2001.
        The HUBZone (Historically Underutilized Business Zone) Program
    encourages economic development in distressed areas through the
    establishment of Federal contract award preferences for qualified small
    businesses located in such areas. This program has gotten off to a very
    slow start. Under the President's budget, the program will receive $2
    million in fiscal year 2002, the same as fiscal year 2001 again with an
    emphasis by the new Administration on more efficient and effective ways
    to fulfill the intent of the program.
        PRO-Net (Procurement Marketing & Access Network) is a government-
    wide online database used as a link to procurement opportunities and as
    a marketing tool for small companies. We request level funding at
    $500,000.
        The 7(j) Technical Assistance Program provides management and
    technical assistance to small and emerging businesses owned and
    controlled by socially and economically disadvantaged individuals and
    also individuals in areas of low income and high unemployment. Under
    the President's budget, the program will receive $3.6 million in fiscal
    year 2002.
                        disaster assistance loan program
        The Bush Administration is fully committed to meeting the needs of
    disaster victims and has proposed a base loan volume of $300 million
    for SBA's Disaster Assistance Loan Program. Additional needs for the
    Disaster Program will be funded through the proposed National Emergency
    Reserve.
        However, there will be no interest rate change for disaster home
    loans. Under the President's proposal, businesses without access to
    credit elsewhere will receive disaster assistance loans at the U.S.
    Treasury Rate, with a ceiling of 8 percent. Based on current rates, the
    business loan interest rate would be increased from the current 4
    percent ceiling to 5.4 percent. On an average loan of $56,300 over 15
    years, the monthly payments would rise from $429 to $473. Over the life
    of the loan, the business would incur an additional cost of $7,344.
    Also, SBA will have the flexibility of keeping the payment at $429 by
    extending the maturity of the loan.
                              sba operating costs
        Although the budget request proposes a small increase in SBA's
    operating costs, we are looking at streamlining SBA's operations and
    doing away with redundant programs. SBA will contract out, as
    appropriate and consistent with the Federal Activities Inventory Reform
    (FAIR) Act, and will continue its asset sales program.
        A major challenge facing SBA is improving its level of customer
    service to meet the growing and changing needs of small business. Over
    the last 10 years, SBA has dramatically changed the way it delivers
    services to small business, using private-sector partners to make and
    service its loans and to provide training and counseling. Yet the
    structure has not changed. For example, by taking advantage of
    electronic commerce, the oversight function carried out today by SBA's
    Procurement Center Representatives could be streamlined and
    centralized.
        SBA has been downsized over the last eight years, but its structure
    has not. SBA still needs to reduce its staff while maintaining critical
    positions.
        SBA met with GAO on April 27, 2001 to discuss the findings in its
    study of SBA's structure. We will take an aggressive look at additional
    privatization and streamline what we do to reduce duplication and
    increase efficiencies. We will develop succession plans and
    reprioritize the use of resources. We will be preparing options for the
    confirmed Administrator to ensure that both SBA's programs and
    structure can serve America's small businesses efficiently and
    effectively.
                             loan monitoring system
        SBA's loan monitoring system (LMS), a four-year project authorized
    in December of 1997 with $8 million appropriated each year since fiscal
    year 1998, is undergoing a substantitive review. In early February
    2001, after I became Acting Administrator, I began looking into the
    status of the project. I have reported my findings to both your
    Committee and the Appropriators. In brief, I have concluded that the
    LMS had become commingled with an internally-sought Systems
    Modernization Initiative (SMI).
        I have since ordered that the program be refocused on the
    activities for which the Congress authorized and appropriated the
    funds--an information technology-based system for risk management,
    lender oversight, and loan monitoring. SBA intends to contract on a
    pilot basis with several established financial institutions that
    already have operational risk management/loan monitoring systems.
    Rather than develop a proprietary system--with all its attendant costs
    and risks--we intend to determine if such a system already exists.
        To this end, we have put Janet Tasker in charge of overseeing all
    of our lender and portfolio oversight. She is a Certified Public
    Accountant (CPA) and served as the Director of the Office of Government
    Sponsored Enterprises Oversight, responsible for providing oversight to
    FANNIE MAE and FREDDIE MAC. She is taking the lead for the LMS project
    and has developed the requirements for our LMS system. These concepts
    have been presented to your staff and the GAO. We are in negotiations
    with highly experienced project management organizations to provide us
    with the expertise to manage and assess the various options that are
    available, and to assist us in presenting those options to our new
    Administrator upon confirmation. In fiscal year 2002, we have requested
    an appropriation of $8 million to bring the original program's scope to
    completion.
        At this point, I emphasize that the agency must have a new
    financial system in place by the end of this fiscal year--September 30,
    2001--when the current Federal Financial System run by Treasury is
    scheduled to be phased out. SBA is proceeding with an Oracle-based
    integrated standard general ledger that will integrate program and
    accounting data, resulting in more timely and accurate financial
    reports and program analysis. This is one of the elements of SMI I felt
    we must pursue. Other elements will wait for decisions by the
    Administrator after his confirmation.
              programs that will not be funded in fiscal year 2002
        The Administration supports the objectives of the New Markets
    Venture Capital (NMVC) Program but believes those objectives can be
    achieved more efficiently and at a lower cost through other existing
    means. Several vehicles and incentives to direct investment into
    economically distressed communities already exist. Communities targeted
    by NMVC have access to a wide range of private for-profit and economic
    development programs, including the federally supported community
    development financial institutions administered through the Department
    of Treasury. In addition, SBA's SBIC program, which has 412 licensed
    venture capital companies with total capital resources amounting to
    $17.7 billion, is implementing incentives to encourage investment in
    economically distressed areas.
        The NMVC Program is also expensive relative to the impact it is
    expected to have. The total cost of the program in fiscal year 2001 is
    $52 million, not including the administrative cost of running the
    program. Since the program is expected to generate $150 to $200 million
    of investment activity, it will yield only $3 to $4 of investment for
    every taxpayer dollar spent. In comparison, under the Small Business
    Investment Company (SBIC) Program, there is no cost associated with the
    debenture portion of the program. The participating securities portion
    of the SBIC program required a $26.2 million credit subsidy in fiscal
    year 2001. Since this subsidy generates $3 billion of investment
    activity, each taxpayer dollar spent provides $114 of investment
    activity in the participating securities program.
        The NMVC legislation also included a $15 billion tax credit for new
    investment in the same communities targeted by the NMVC Program. The
    Administration believes that targeted tax policy and other private
    sector incentives are the right formula to spur economic development
    with less emphasis on government outlays. The NMVC Program has been
    funded in fiscal year 2001. However, until the program can show some
    results in the way of established return on equity, any additional
    funding would be premature.
        The Program for Investment in Microentrepreneurs (PRIME) Program,
    like the NMVC Program, is duplicative of existing SBA programs and
    other programs within the Federal government and the private sector,
    i.e., community development organizations and local financial
    institutions (see attached chart). SBA has a wide array of funded grant
    programs that provide technical assistance to small businesses. SBA's
    Microloan Program, for example, provides grants enabling intermediaries
    to provide marketing, management, and technical assistance to
    individual microborrowers. Additionally, the Microloan Program provides
    funding to non-lending technical assistance providers to help low-
    income individuals start or improve their own business. Microloan
    intermediaries and non-lending technical assistance providers are the
    same groups targeted by PRIME grants. There are also other private-
    sector entities, such as trade organizations, whose members are engaged
    in the microenterprise industry and provide similar services. Other SBA
    programs available for these customers include SCORE, SBDCs, OSCS and
    WBCs.
        The Business Learning, Innovation, Networking and Collaboration
    (BusinessLINC) program was designed to create and foster mentor-protoge
    relationships that would promote the growth of small businesses by
    matching them with larger concerns. The program is similar to other SBA
    technical assistance programs already in place. One of SBA's most
    successful technical assistance programs, SCORE, manages a nationwide
    network of 11,400 volunteers who provide free expert advice based on
    their many years of experience on virtually every aspect of business.
    SCORE's free counseling service provides a mentor framework to assist
    small businesses similar to that envisioned for BusinessLINC. The SBDC
    consulting service is another means of providing technical assistance
    and services to more mature companies seeking to expand their
    relationships or customer base to include larger concerns. SBA also
    provides the 8(a) mentoring program and a women's mentoring program.
    Other agencies such as the Department of Defense and NASA support
    mentor-protege programs.
        BusinessLINC is duplicative of SBA's 7(j) management and technical
    assistance program, which authorizes contract grants and cooperative
    agreements to organizations that provide direct assistance to small and
    emerging businesses owned by socially and economically disadvantaged
    individuals. SBA is authorized to target 7(j) services to businesses
    and individuals located in areas of high unemployment and low income.
    Many of these providers were successful in fostering business-to-
    business relationships between larger and smaller firms. Service
    providers report direct assistance to nearly 3,000 eligible businesses.
    Many BusinessLINC activities can be accomplished using the existing
    7(j) authorization.
        BusinessLINC was designed to provide small businesses with an
    online information source and database of companies interested in
    mentor-protege programs. These goals may be achieved through existing
    BICs, WBCs, TBICs, OSCSs and PRO-Net. Private sector alternatives that
    would provide incentives for larger businesses to enter into mentoring
    programs should also be examined.
        As I mentioned at the beginning of my testimony, SBA's fiscal year
    2002 request is a good budget for small businesses. Thank you for the
    opportunity to appear here today. I will be happy to answer your
    questions.

        Senator Hollings. Thank you, Mr. Whitmore.
        Senator Inouye.
        Senator Inouye. Mr. Chairman, I just wanted to come by to
    thank SBA for all the help they have provided. One of the
    lesser-known facts about Hawaii is that 98 percent of our
    businesses are small businesses. In fact, on a per capita
    basis, if it were not for SBA, we would still be in a slump.
        It is no secret that about 7 or 8 years ago, there was a
    major downturn in the economy in Asia, and as a result, it
    affected tourism in Hawaii. But with your help, we put new
    businesses into operation, and we are back in business. Our
    unemployment rate, incidentally, is less than the national rate
    thanks to these people here.
        So I have no questions. I just want to thank you.
        Senator Hollings. Very good.
        Mr. Whitmore, the SBA has been doing an excellent job. We
    depend on it substantially in the State of South Carolina.
        You mentioned the 1997 Act, and in that 1997 Act, we
    prohibited the Small Business Development Centers from charging
    fees. In your testimony, you talk about empowering small
    business, but then you burden them by charging them fees,
    otherwise in violation of the 1997 statute. Where do you get
    the authority to impose a fee?
        Mr. Whitmore. We are proposing a new legislative proposal
    to accompany the budget that would allow the charging of fees.
    Currently, the SBDCs do charge training fees, and they also
    charge some processing fees in the beginning. Our other
    technical assistance programs, like the Women's Business
    Centers, also charge fees. With the new Administration, we
    looked at all of our programs to find a way of controlling the
    rising cost of delivering technical services.
        We are proposing charging a fee of $10.75 an hour. We know
    that the average counseling hours in a given year for a small
    business is approximately 5 hours, Senator. We propose no fee
    charge for the first hour, so it would be about $44 over the
    course of the year. We think that that is a rather modest fee
    to pay for the advice given by the SBDCs, and it helps share
    the burden of the cost with those who benefit from the service.
        Senator Hollings. SBA, of course, is a Government program
    for small businesses that do not have the wherewithal. They
    cannot hire counsel, lawyers, consultants, computer experts and
    otherwise. That is why the Federal Government furnishes this
    service and assistance to small business--and it works. I am
    beginning to be of the Bush school--give a tax cut wherever we
    can, particularly for small business. Do not start taxing
    them--you call it a ``fee'' but all of a sudden, they are going
    to pay a tax. Let us go right to the 7(a) program, not just the
    $12 million that you have got to make up for SBDC's, but under
    7(a), you have got to make up $114.5 million in fees annually
    in the 7(a) guaranteed loan program. Is that right?
        Mr. Whitmore. Yes, sir. In the 7(a) loan program, we do not
    intend to charge fees where the loans are most needed, and that
    is loans under $150,000. We think that that is the area where
    small businesses really struggle to obtain loans.
        On loans of $1 million, the cost to the business would be
    about $42 a month more. We think that borrowing at that level,
    they should be able to pay some of that cost.
        Under $150,000, we have no proposal to increase fees to
    small business. Sixty percent of our loans are less than
    $150,000, so the fees would only be on approximately 40 percent
    of the loan program.

                         additional committee questions

        Senator Hollings. Well, we will have to see if the
    committee wants to go along with that justification.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]
                   Questions Submitted by Senator Judd Gregg
                                  7(a) program
        Question. I am concerned that SBA's budget request would drive both
    small business borrowers and lenders from the 7(a) program. I do not
    believe that it is the intent of the Administration to deny needed
    business loans to small business borrowers at the same time the economy
    is slowing and credit underwriting standards have tightened
    significantly. Has the SBA analyzed the effect of the 7(a) proposal on
    borrowers and lenders? Approximately how many entities would no longer
    take advantage of the program?
        Answer. The Administration believes that the 7(a) program plays a
    valuable role in strengthening the nation's economy by making credit
    available to small businesses that would be unable to access loans in
    the commercial marketplace.
        SBA agrees with the Administration in that it is unfair for
    taxpayers to subsidize the government costs for such loans. With this
    in mind, the Administration's budget provides for modest fee increases
    only on loans over $150,000. In effect, those who benefit most from the
    program should share in the cost.
        Last year, more than 60 percent of the loans that SBA guaranteed
    were at or below $150,000. Since we are proposing no change in the fees
    paid on those size loans, none of the borrowers with smaller credit
    needs would be impacted by the proposed fee changes. This allows for
    those businesses who are in the most crucial stage of business
    development to secure valuable funding.
        While it is difficult to quantify how many borrowers or lenders
    might not take advantage of the 7(a) program because of the fee
    changes, SBA thinks that both parties will adjust to the changes. SBA
    cannot guarantee a loan if the credit is otherwise available. Thus,
    most of the borrowers that require SBA's support of their loans would
    continue to make appropriate use of the 7(a) program.
        Question. This Committee believes that the 7(a) program is already
    operating at or near a zero subsidy rate. How were the subsidy cost of
    the 7(a) program estimated? Please provide in writing a list of experts
    from within SBA, the OMB, the GAO, and outside of the government groups
    who could be charged with compiling an accurate accounting of the
    subsidy rate.
        Answer. SBA's 7(a) subsidy rate model has been refined over a
    number of years. Principal model inputs include actual loan performance
    over an approximate 15-year period, and technical assumptions on the
    structure/operation of the program. These assumptions produce a series
    of estimated cash flows over the life of the loans for a given year.
    These cash flows are then discounted using the Treasury discount rate
    provided by OMB to generate an estimated subsidy cost of the program.
        The principal assumptions used by the model, and added by SBA each
    year, are the distribution of the dollar value of loans to be made by
    size, the fee structure, the Treasury discount rate (provided by OMB),
    and the level of prepayments (provided by Bloomberg). The remaining
    significant modeling factors are derived from the loan portfolio's
    actual performance over the approximate 15-year period, including
    defaults, recoveries, expenses, and fee income.
        SBA's Office of Financial Analysis calculates these subsidy rates
    and is staffed with finance, economic, and modeling experts to provide
    the appropriate level of skills and knowledge to this complex process.
    We supplemented this expertise with private-sector experts from
    PriceWaterhouseCoopers (PwC), Ernst & Young (E&Y), and use a private
    firm (Bradson Corp.) to independently validate our annual results.
    Additionally, GAO has worked closely with us over the last several
    years to extensively review these models. In their 1997 report, they
    cited SBA as one of only two agencies in government able to do
    reasonable cost estimates of its programs.
        The models are also annually audited by our Inspector General and
    its private-sector auditor, Cotton & Co. Finally, experts in Federal
    Credit Reform at the Office of Management and Budget (OMB) thoroughly
    review and approve the SBA models and results, and provide final
    decision authority over methodologies and results. As part of the
    annual budget process, the Congressional Budget Office (CBO) also
    reviews these models.
        As indicated above, SBA's subsidy rate modeling process undergoes
    an extensive and comprehensive review. While there are certainly
    different modeling methods that could be used that would produce
    different results, the current process is sound and attested by a large
    number of experts in Federal Credit Reform and financial/econometric
    modeling.
                             disaster loan program
        Question. Your budget provides for a $300 million disaster loan
    program. In fiscal year 2001, Congress provided for a $900 million loan
    level. My understanding is that your budget request proposes to cover
    the cost of loan guarantees above the $300 million level through a $5.6
    billion government-wide emergency reserve. Have you made plans to cover
    the cost of disaster loans without the use of this reserve? If so,
    please provide them in writing. Assuming an emergency reserve were
    available, what is the mechanism that would trigger loan authority as
    needed? Assuming that the SBA would be in competition with other
    agencies, how would SBA be guaranteed to qualify for use of this
    reserve?
        Answer. In the President's budget request, enough funds were
    included in a National Emergency Reserve to cover a five year average
    for programs that make up a large part of the Federal Government's
    response to man-made and natural disasters. However, in the Budget
    Resolution that Congress passed, a National Emergency Reserve was not
    included nor was the $5.6 billion to cover the five year average.
    Therefore, in fiscal year 2002, additional funding may be needed in one
    form or another.
                       small business development centers
        Question. In 1997, in response to an SBA request for fiscal year
    1998 which directed that the SBDCs begin charging fees, the Congress
    passed the Small Business Reauthorization Act of 1997. The Act
    prohibits the SBDCs from imposing or collecting fees in connection with
    small business counseling services provided by the program. What
    circumstances have changed whereby, in your opinion, the Congress and
    the small business community would support repealing this provision?
        Answer. The SBA is aware of the current legal prohibition against
    charging fees in the Small Business Development Center program. Since
    1997, when the prohibition was enacted, the Federal share of the SBDC
    program has gone from $73,500,000 to $84,281,000. The number of clients
    counseled and trained in those years is shown below:

    ------------------------------------------------------------------------
                         Year                        Counseled     Trained
    ------------------------------------------------------------------------
    1997..........................................      245,766      377,651
    1998..........................................      237,655      309,382
    1999..........................................      263,927      331,464
    2000..........................................      258,306      324,292
    ------------------------------------------------------------------------

        In each year, SBDCs trained many more clients than they counseled
    and, in most cases, charged fees for that training.
        Total income for the SBDC program in the preceding three years is
    shown below:

            Year                                              Program Income
    1998....................................................      $7,000,388
    1999....................................................       7,884,864
    2000 estimate...........................................       8,300,000

        Training events generated the majority of this income. Many of the
    fees for a single training event are equal to the potential total cost
    for the average counseling client. Therefore SBA's fiscal year 2002
    proposal simply builds upon the SBDCs' success in already generating
    program income through training.
               program for investment in microenterprises (prime)
        Question. When will applicants be able to submit proposals for the
    first round of PRIME grants? When will the PRIME grants be awarded?
        Answer. The final regulations were published in the May 29, 2001
    Federal Register, along with a ``Notice of Funds Available'' inviting
    eligible entities to submit funding proposals to the Agency. The PRIME
    regulations will become final on June 28, 2001 which is also the
    closing date for acceptance of the funding proposals.
        PRIME grant awards will be made late in the forth quarter of fiscal
    year 2001.
                        systems modernization initiative
        Question. Please provide a report in writing on exactly how funds
    for the Systems Modernization Initiative have been spent. In this
    report, please include any funds that were appropriated for the Systems
    Modernization Initiative that were spent for other activities. It is my
    understanding that SBA will review its plans for the Systems
    Modernization Initiative and report a revised schedule to the Congress.
    When will this report become available? Who will write this report?
    Have you considered contracting with an outside expert to head this
    project?
        Answer. As stated in the oral and written testimony, the creation
    of a Loan Monitoring System (LMS) expanded to include an internally
    sought modernization initiative. John Whitmore, Acting Administrator,
    asked both this subcommittee as well as the House not to act on the $8
    million spending plan for fiscal year 2001 submitted by the previous
    Administration until he had time to determine where we were and where
    we should be going. We have retained KPMG to assist in assessing
    available options. The following is an accounting of the $23,934
    (includes rescission) 4 million, appropriated in fiscal year 1998-2000:

    LMS:
        Planning..................................................$2,941,000
        Systems Acquisition....................................... 1,371,000
        Infrastructure............................................   175,000
        Other costs (travel, etc).................................   508,000
        Personnel................................................. 2,849,000
                        --------------------------------------------------------------
                        ____________________________________________________

          Subtotal................................................ 7,844,000
                        ==============================================================
                        ____________________________________________________
    Financial Accounting and Management System:
        Project Planning..........................................   717,000
        Training..................................................    48,000
        Systems Acquisition....................................... 1,579,000
        Systems Integration....................................... 3,673,000
        Other Costs (travel, etc).................................    39,000
        Personnel................................................. 1,187,000
                        --------------------------------------------------------------
                        ____________________________________________________

          Subtotal................................................ 7,243,000
                        ==============================================================
                        ____________________________________________________
    Other:
        Project Planning..........................................   238,000
        Subsidy Rate Analysis.....................................   678,000
        SBLC Reviews..............................................   740,000
        Infrastructure............................................   421,000
        Personnel.................................................    19,000
        Disaster project planning.................................   150,000
    Other SBA programs: Project planning..........................   100,000
                        --------------------------------------------------------------
                        ____________________________________________________

          Subtotal................................................ 2,464,000
                        ==============================================================
                        ____________________________________________________
    FEDSIM (includes $2,300,000 transferred from operating funds
        in fiscal year 2000)...................................... 8,683,000

        SBA is presently taking steps to determine the exact cost of
    implementing an effective and reliable loan monitoring system. With the
    information to date, the Agency believes the total of implementation of
    both the LMS and Financial Accounting and Management system will be $40
    million or less.
        The Acting Administrator plans to send a spending letter once
    precise cost estimates are determined, which we hope will happen within
    the next month.

                              subcommittee recess

        Senator Hollings. I have momentarily a requirement to be on
    the floor, so let me say that the record will remain open
    subject to the direction of our distinguished chairman, and
    unless you have anything further, we will stand in recess
    subject to the call of the chairman.
        Thank you very much, both of you.
        [Whereupon, at 11:13 a.m., Tuesday, May 15, the
    subcommittee was recessed, to reconvene subject to the call of
    the Chair.]

    DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE JUDICIARY, AND RELATED
                  AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2002

                                  ----------

                             THURSDAY, MAY 17, 2001

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 10 a.m., in room SD-192, Dirksen
    Senate Office Building, Hon. Judd Gregg (chairman) presiding.
        Present: Senators Gregg, Domenici, Hollings, and Murray.

                             DEPARTMENT OF JUSTICE

                        Federal Bureau of Investigation

    STATEMENT OF LOUIS J. FREEH, DIRECTOR

                        opening remarks of senator gregg

        Senator Gregg. We will begin the hearing.
        I understand Senator Hollings is in another hearing and
    will be joining us, as will a number of members of the
    Subcommittee on Commerce, Justice, State of the Appropriations
    Committee.
        Let me briefly say a couple of things, because this will be
    the last hearing that we have the Director with us, as he is
    moving on.
        I want to congratulate him for being an extraordinary
    leader of the FBI. This committee has had an intimate and
    intricate relationship with the FBI. We have had some
    disagreements, but we have had many more agreements.
        During the period of the Director's service, the FBI has
    expanded its role and resources dramatically. It has had to
    take on all sorts of new issues involving the question of
    protecting America and Americans, especially the issue of
    counterterrorism; the issue of cybercrime; the issue of crimes
    against our children, especially over the Internet; the issue
    of a nation which is more complex every day, and bigger, and
    the crime issues associated with that.
        We have dramatically expanded the number of agents,
    dramatically expanded the resources, and under your leadership,
    significantly improved innumerable functions within the FBI.
    When issues have arisen, of which there have been a few, such
    as the labs, they have been addressed aggressively, in my
    opinion, and effectively.
        And as a result, I think your tenure at the FBI will be
    marked down as one of the finer periods of leadership of that
    agency. And I certainly admire your leadership.
        That is not to say that we do not have issues, and we
    obviously have issues pending that are fairly significant, very
    significant, especially relating to the document-handling
    activities in the McVeigh case and the potential that that
    might reflect for systematic problems within the agency.
        And I know that the Bureau, under your leadership, is
    setting up processes for addressing those. This committee may
    take a look at additional ways to address that. I know we are
    going to--I personally, want to take a look at--I know you are
    going to have the Inspector General looking at the issue, I
    know you are personally looking at the issue, and I know you
    have brought in a specialist to look at the issue.
        But we may want to take a look at setting up an independent
    group to come in, such as Arthur D. Little or some management
    team, because, after 10 years and a dramatic amount of money
    and personnel expansion, it might be appropriate to get an
    evaluation by an independent group.
        But that is not to be looked on, from my point, as a
    negative, rather as simply a reasonable management decision
    that should be considered.
        The Bureau is our premier effort in this country to protect
    our citizens and to make sure that people who commit crimes
    which affect our citizenry are brought to justice. And you do
    an exceptional job. Mistakes happen, some of them are terrible.
        And certainly, in the McVeigh situation, this is a man who
    under no circumstances should escape the justice of our system,
    and who committed a crime so heinous that it is hardly even
    believable.
        And the people that he harmed continue to be harmed by it.
    And we want to make sure that no activities occur which will
    negatively impact his conviction and would in any way relieve
    him of the responsibility of the crime he committed.
        But I think I understand, and I think most of us
    understand, that this was not an international oversight. It
    was an oversight of error and management that has to be looked
    at and which is being looked at and will be corrected.
        And, obviously, there are other areas in which you are
    proceeding, dealing with agents who have not acted
    appropriately.
        So I just wanted to make the point that, having worked with
    you for these last 7 years it has been a pleasure. I admire
    what you have done. I think you have taken a very strong agency
    and made it a lot stronger.
        And it needs, obviously, to address some very significant
    issues. But on balance, America is lucky to have the FBI. And I
    feel fortunate to have worked with you over the years, Mr.
    Director.
        And so, with that, I give you the floor.

                       director freeh's opening statement

        Mr. Freeh. Thank you, Mr. Chairman. Good morning, and thank
    you for your very kind words.
        And let me reiterate my great honor and great pleasure in
    this period of my government service, the last 8 years, in
    working with the Senate, of course, but particularly the
    committees with which we have had such daily and intensive
    interaction, and particularly this committee.
        I would like to thank you for your leadership in broad
    areas of responsibility that have been strengthened with the
    support, as well as the interest, and the hearings and the
    examination and the questioning, tough questioning, as
    appropriate to our mission, how it has been shaped by changes
    in the global world and the technology. And I think that we are
    better for that.

           counterterrorism, technology, and crimes against children

        I am particularly proud of your leadership in the
    counterterrorism area, the technology area, and the crimes
    against children area. And I just wanted to mention those very,
    very briefly.
        The Innocent Images Project, which was initiated by
    interest in this committee several years ago, has now developed
    into a full-blown operation that saves children's lives and
    protects people in a very extraordinary way. We have now over
    1,000 convictions in the Innocent Images operations, which, as
    you know, are in 22 offices and occupy dozens of our FBI
    special agents and personnel.
        These are crimes and threats which were not addressed
    heretofore by any Federal agency. And there was certainly no
    focused and directed resources and attention placed on these
    types of crimes until this committee and, quite frankly, your
    leadership, took charge of that.
        The problem is really not solved, as we know; 2,000
    children are reported missing every day in the United States,
    not all because of criminal conduct, but many because of that.
    The Innocent Images initiative, which now has grown into a
    Crimes Against Children Program where we have at each of our
    offices two agents who are the coordinators of that program,
    interfacing directly, not just on Innocent Images modality, but
    all the other aspects of that program, is something that did
    not exist a long time ago.
        As the Director, and certainly as a father, I want to thank
    you for your support for that particular program of which I am
    very, very proud.
        In the counterterrorism area, I visited Kenya and Tanzania
    about 3 weeks ago. The purpose of my visit was to return to
    those countries before the end of the prosecution in New York
    so I could thank the police officers and the leadership of
    those two governments for the assistance that they provided--
    remarkable assistance--in the embassy bombings case, which is
    now before a jury deliberating in New York City.
        The ability to investigate that case, from the initial
    deployment of resources to the expenditure of personnel and
    other materials to develop the investigation, obtain the
    evidence, bring it back to the United States as well as all of
    the preparation that had to be done, could not have been done
    in my view, 5, 6, 7 years ago. The FBI was not equipped either
    organizationally or, maybe more importantly, on a funded level
    to do that type of a case as successfully, as it was done
    almost on the other side of the world.

                     threefold increase in counterterrorism

        Your support of the rapid deployment teams, all of the
    laboratory enhancements, and the ability to give us a threefold
    increase in the counterterrorism program, is what enabled FBI
    agents to go to East Africa and, in conjunction with their
    colleagues in those countries, make a case which I often say
    the FBI was not entitled to make, because it was far outside
    our jurisdiction and authority. But you gave us the
    infrastructure and the support to do that.
        I am very thankful for that, and I think the FBI and the
    American people are grateful for the ability that we have in
    the counterterrorism area.
        It goes well beyond that, though, in your support for the
    overseas operations of the FBI. Also, I would like to note in
    my final appearance before the committee--Senator Hollings,
    good morning.
        Senator Hollings. Good morning.
        Mr. Freeh. When I arrived in Nairobi to, as I said, thank
    the two principal leaders of the country and the police for
    their assistance, they gave me a newspaper as I landed.
        I will just pass it up to the committee with your
    permission.
        And the headline reads, this was the day I arrived in
    Nairobi, ``Three Americans Rescued in Kidnap Ordeal.'' It was
    not timed for my arrival, but what it exemplified is the
    gratitude I just expressed for the support of our overseas FBI
    programs.
        What happened in this case is that two American businessmen
    from California thought they found on the Internet a supporter
    for a financial enterprise that they wanted to engage in, and
    they traveled to Nairobi.
        But instead of meeting their business partners, the two
    Americans were kidnapped. Using e-mail, very sophisticated e-
    mail, as well as cellular phones, the kidnappers communicated
    with the families of the two Americans to extort them for a
    sizable sum of money under threat of death.
        The FBI agents who were in Nairobi, and were there because
    of the committee's support and were not there a couple of years
    ago, actually worked on this kidnapping with the Kenyan police
    on the ground. They mounted the operation that led to the
    direct rescue of these two Americans.
        In fact, the FBI agent was on the phone negotiating with
    the hostage takers and was the individual directly responsible
    for their release.
        When the two Americans were released, they mentioned that a
    third American was being held. There was a third kidnap victim
    who had been held for 4 months by the same group, but his
    disappearance had not been reported. Nobody knew that he was
    being held. The agents were told after they secured his release
    that he thinks other people, Americans, may have been held
    during that period and perhaps even killed.
        The ability to work a kidnapping case in Nairobi and the
    necessity to exploit and intercept e-mail communications and
    deploy people back and forth, again, is something that was not
    present in the FBI a short time ago, but is there now because
    of the commitment that has been made, not just to the
    counterterrorism program, but to our ability to operate
    overseas.

                   national infrastructure protection center

        Finally, in the technical area, whether it is the National
    Infrastructure Protection Center, which supports Innocent
    Images, or the funding that this committee has provided does
    not make us the perfect model for information technology. We
    know that is not the case and we have a lot to build in that
    area.
        But we have been furnished with the raw materials, with
    what the leadership in this committee has provided. The
    mission, and now I believe the expertise on board at the FBI is
    enough to not just make the Trilogy project a successful IT
    model, but to help us through the difficulties that the
    information age necessarily portends for an agency that is
    involved in collecting information every day.
        So in those three areas--and I could highlight others--I
    want to particularly thank you, Mr. Chairman, Senator Hollings,
    and the other members of this committee.
        You have had hearings well beyond the normal scope of the
    appropriations process into the counterterrorism area. You
    organized a very extraordinary hearing last week by several
    Senate committees, who, as I understood it, have never gotten
    together before on the central issue of counterterrorism. And
    for that, I want to compliment you and tell you how grateful we
    are.

                     Mc Veigh matter and records management

        With respect to the McVeigh matter, I have a statement,
    which the committee has received and which I read yesterday at
    my hearing. I do not want to repeat it again; I am certainly
    pleased to answer any questions that you or the members have.
        I will highlight, however, that we note in that statement
    that we are taking some particular steps which we believe are
    necessary, but also will be instrumental in dealing with a
    fundamental problem, which is not a technology problem. We
    believe it is just a management and execution problem.
        And even given the very extraordinary scope of this case,
    in terms of the numbers of materials involved, millions and
    millions, we did a less than good job with respect to the
    accumulation and the discovery of documents called for in an
    unprecedented type of discovery agreement, but nevertheless
    called for and not produced as they should have been by the
    FBI. And I take responsibility for that.
        I am also taking some steps to try to address it. As I
    mentioned yesterday, we asked for the recruitment of a records
    management expert, who would be a senior official concerned
    only with this particular problem, the problem of records
    management. We have over 6 billion paper records, as well as
    many electronic records, and we are going to look at it as a
    separate and critically important structure to improve on its
    own.
        We are also going to take some steps to increase the
    training of all of our personnel with respect to the management
    of records. We are going to propose a modification of the
    Trilogy project, which will give us, we believe, the ability to
    account and order documents in an electronic format, which we
    have not done. We are going to have a stand-down in the FBI, as
    I mentioned yesterday, so we can take full measure of both the
    importance and the necessity of correcting this problem.
        The creation, filing, and dissemination of our own
    investigative records is as important to ensuring the rights of
    those that we protect, as well as those who we investigate, and
    that is as important as every other constitutional requirement
    that we have.
        So I will endeavor to not only get that initiative going,
    but to make sure that it is followed through. And you have our
    commitment for that.

                              2002 budget request

        With respect to the 2002 budget, I just wanted to briefly
    comment on the matters, which are well-known to the committee
    and the staff. The budget calls for four new initiatives with
    respect to increased program support. The categories are
    counterintelligence, counterterrorism, cybercrime, and
    infrastructure. There are a number of subissues with respect to
    those main categories.
        The budget will take us where we need to be on the
    information technology front. Also, the budget will give us the
    additional enhancements in the counterintelligence and
    counterterrorism programs that are required to meet some of the
    new challenges. And with respect to cybercrime, which is really
    the cross-cutting technology affecting all of our programs,
    some of the requests for enhancement will give us the ability
    to manage not only the programs that we currently employ, but
    also give us network data interception abilities. It will go a
    long way to at least beginning to deal with the encryption
    issue.

             Communications assistance for law enforcement (CALEA)

        One of the pieces of unfinished business which I regret to
    leave is the encryption issue. We have not made much progress
    over the course of 8 years in addressing that central problem.
    The CALEA statute and the $500 million in support of that
    program have been very successful with respect to solving the
    access issue. However, remaining behind is the plain text issue
    of the materials that will now be accessed by the CALEA funding
    and the common carriers' cooperation as set forth in the
    statute.
        My prediction as I leave is probably equal to what it was
    several years ago, and that is, if we do not solve the
    encryption problem very decisively, in a very short period of
    time, many of the avenues of investigative opportunities will
    become either difficult or closed to us.
        The speed with which the digital systems are being employed
    and telecommunications are migrating from the old analogue
    environment to the digital environment will preclude law
    enforcement officers with court orders in hand from
    understanding, if not accessing, materials, evidence, and
    information which they will receive in due course.
        Unless we can address that problem, the main complicated
    areas of our programs, particularly in counterterrorism,
    complex international crime, but also everything else, will
    suffer as a result.
        We take a couple of small steps in the 2002 request to lay
    the foundation for the counterencryption strategy. What is
    going to be needed in the years to come, is a lot more
    measures: the technical support center, the integration of our
    efforts with our State and local counterparts in this
    particular area.
        The voluntary approach I think has worked with the
    industry, but the industry is looking for statutory support for
    those voluntary efforts of assistance to the FBI and to the
    government.
        The Cyberspace Electronic Surveillance Act statute, which
    came up to the Congress last year, would give the industry some
    measure of protection in the areas where we will be asking them
    for their assistance.
        These are the kinds of measures that I think are going to
    need to be addressed. And I am very thankful, Mr. Chairman, for
    your leadership on this issue.
        This has been a very difficult issue. It is where law
    enforcement and privacy intersect. There are very good
    arguments and very persuasive arguments on both sides, but I
    think a balance has to be struck between those equities.
        I do not think law enforcement should have a free rein
    here, but I also do not think that valid privacy interests
    should preclude the effectiveness of a Federal court order that
    allows and authorizes an agent of the United States to
    intercept information and evidence. If they cannot understand
    the evidence that is being intercepted, the order almost
    becomes a nullity in itself.
        So one of my continuing recommendations will be to keep the
    interest and the movement in this particular area, which, is
    very cumbersome. It is easy to get distracted, and it is easy
    to get frustrated, either on the privacy side or on the law
    enforcement side, which is why I think a voluntary approach
    really needs to be struck. I believe this voluntary approach
    can be struck. And that would be my hope in the years to come.

                               prepared statement

        I will certainly be pleased to answer any of your questions
    at this point.
        [The statement follows:]
                      Prepared Statement of Louis J. Freeh
        Good morning, Chairman Gregg, Senator Hollings and other members of
    the Subcommittee. Once again, I am pleased to discuss the fiscal year
    2002 budget request for the Federal Bureau of Investigation (FBI).
        The work of the FBI, whether it is catching criminals, drug
    traffickers, terrorists, and spies; providing training, investigative
    assistance, and forensic and identification services to our law
    enforcement partners; or developing new crime-fighting technologies and
    techniques, is made possible by the strong support of this
    Subcommittee. On behalf of the employees of the FBI, I thank you.
                           challenges facing the fbi
        Before discussing our fiscal year 2002 budget request, I would like
    to highlight for the Subcommittee several of the challenges facing the
    FBI, and update you on the implementation of the FBI Strategic Plan
    that we adopted in 1998 to prepare the FBI for the 21st Century. This
    plan and its vision of the FBI is especially important given the
    challenges and changes facing the FBI.
        Increasingly, the crime problems and national security threats
    facing the FBI are transcending the traditional investigative programs
    under which the FBI operates. For example, the Southwest Border and
    East Caribbean crime strategies are based upon a coordinated attack
    against drug trafficking (organized crime/drugs program), violent
    crimes and gangs (violent crimes program), and public corruption
    (white-collar crime program). Emerging criminal enterprises from
    Eastern Europe and Eurasia tend to be involved not only in
    ``traditional'' organized crime activities, such as extortion, loan
    sharking, and street crime, but also complex money laundering, tax
    evasion schemes, medical fraud, and other ``white-collar'' offenses and
    international trafficking in prostitution.
        We are also facing a growing internationalization of crime.
    Increasingly, cases being worked by FBI Agents on the streets of
    America are developing leads that take us to foreign lands for
    resolution. Recent events, such as the abductions and brutal murders of
    Americans in Uganda and Colombia, required the FBI to exercise its
    statutory extraterritorial jurisdiction and deploy investigative teams
    overseas. Organized criminal enterprises are often involved in related
    illegal activities on several continents. Communications networks and
    the Internet allow criminals in foreign countries to commit theft and
    fraud or to distribute child pornography in the United States without
    leaving their homelands.
        To respond to these types of emerging crime problems and national
    security issues more quickly, the FBI must focus its efforts and
    resources along broader investigative strategies.
        Another challenge facing the FBI is the changing demographics of
    our workforce. Since assuming the position of Director in September
    1993, the FBI has hired and trained approximately 4,800 new Special
    Agents. Agents hired since September 1993 represent about 41 percent of
    the agents on board today. While I am immensely proud of our agent
    workforce, I am also aware that it is a young workforce in terms of
    experience. Similarly, we have hired nearly 7,800 new support employees
    since September 1993; nearly 36 percent of our current support
    employees entered on duty since September 1993.
        Keeping current with the fast pace of technology and more complex
    crime problems and issues requires a more technically trained and
    competent workforce. This applies not only in terms of our
    investigators, but also with respect to the scientists, engineers,
    analysts, and other support staff who help our agents do their jobs. We
    are also recognizing that technically trained specialists are becoming
    an increasingly important part of our investigative teams.
        Emerging technologies present both a challenge and an opportunity
    for the FBI to develop new methods and capabilities for preventing and
    investigating crime and protecting the national security. Criminals,
    terrorists, and foreign intelligence agents, mirroring legitimate
    businesses and society in general, have embraced information technology
    and recognize the potential of new efficiencies and capabilities in
    developing and maintaining criminal enterprises and other illegal
    activities. Traditional crimes, especially financial and commercial
    crimes, are now being committed in a digital world. Paper trails are
    now electronic trails. Records which were once written and stored in a
    safe are now written to electronic media and encrypted. At the same
    time, the same efficiencies and capabilities being exploited by
    criminals and others to commit crimes can also be used to improve the
    effectiveness of the FBI and law enforcement in fighting those very
    same illegal activities. We must be able to upgrade existing
    investigative techniques and technologies and to take advantage of
    emerging technologies to develop new capabilities to keep abreast of
    changing criminal problems and national security issues.
        Ensuring an infrastructure to support the operational, information
    technology, administrative, safety, and security requirements of the
    FBI also presents challenges. The FBI employs over 27,000 employees,
    located in 56 major field offices, approximately 400 smaller resident
    agencies, four information technology centers, a fingerprint
    identification and criminal justice information complex, a training
    academy, an engineering research facility, and FBI Headquarters. We
    also operate Legal Attache Offices in 44 foreign countries on the
    continents of Africa, Asia, Europe, North and South America, and
    Australia. Tying these offices together are large, complex radio
    communications and telecommunications networks. In addition, we also
    operate and maintain a nationwide criminal justice, forensic, and
    investigative information systems and services, such as the Integrated
    Automated Fingerprint Identification System, the National Crime
    Information Center, the National Instant Criminal Background Check
    System (NICS), Law Enforcement On-line, the Violent Criminal
    Apprehension Program, and the Combined DNA Identification System, that
    are relied upon by federal, state and local law enforcement and
    criminal justice agencies.
                           fbi strategic plan update
        Three years ago, I issued the FBI Strategic Plan, 1998-2003. This
    plan represented the culmination of work performed over a year's time
    by a strategic planning task force. This group conducted strategy
    sessions with every FBI investigative program, both criminal and
    national security, and met with FBI Special Agents in Charge and other
    field office representatives. In doing so, the task force not only
    identified the strategic direction and national priorities for the FBI,
    but it also performed a self-assessment of the FBI's capacity to
    achieve these goals. This self-assessment identified deficiencies and
    performance gaps that must be improved or completely eliminated if we
    are to be successful in dealing with emerging crime problems and more
    challenging threats and issues related to protecting the national
    security. Some of these deficiencies and performance gaps are being
    corrected by reengineering processes and implementing policy decisions,
    while others may require funding and resources to mitigate.
        Guiding the implementation of our national priorities is a
    statement of core values for performing the mission of the FBI, which I
    personally wrote. Briefly, the core values that I have established for
    FBI employees can be summarized as follows: rigorous obedience to the
    Constitution; respect for the dignity of all those we protect;
    compassion; fairness; and uncompromising personal and institutional
    integrity.
        To accomplish the mission of the FBI, we must follow these core
    values. The public expects the FBI to do its utmost to protect people
    and their rights. As I have told FBI employees, observance of these
    core values is our guarantee of excellence and propriety in meeting the
    Bureau's national security and criminal investigative responsibilities.
        The FBI Strategic Plan, 1998-2003 identified three major functional
    areas that define the FBI's strategic priorities. These three national
    priorities are: national and economic security; criminal enterprises
    and public integrity; and individuals and property. Within these three
    functional areas the FBI identified nine strategic goals emphasizing
    the FBI's need to position itself to prevent crimes and
    counterintelligence activities, rather than just reacting to such acts
    after they occur, as follows:
        National and Economic Security.--Our highest national priority is
    the investigation of foreign intelligence, terrorist, and criminal
    activities that directly threaten the national or economic security of
    the United States. We have established four strategic goals for this
    area:
      --Identify, prevent, and defeat intelligence operations conducted by
            any foreign power within the United States, or against certain
            U.S. interests abroad, that constitute a threat to U.S.
            national security;
      --Prevent, disrupt, and defeat terrorist operations before they
            occur;
      --Create an effective and ongoing deterrent to prevent criminal
            conspiracies from defrauding major U.S. industries and the U.S.
            Government; and
      --Deter the unlawful exploitation of emerging technologies by foreign
            powers, terrorists, and criminal elements.

                  KEY TIER 1 PERFORMANCE INDICATORS, 1999-2000
    ------------------------------------------------------------------------
                                                           1999       2000
    ------------------------------------------------------------------------
    Foreign Intelligence Surveillance Act Applications        531        562
     Processed........................................
    Counterespionage (CE) Arrests and Locates.........         16         11
    CE Information and Indictments....................         18          9
    CE Convictions and Pre-trial Diversions...........         17          6
    Joint Terrorism Task Forces.......................         23         29
    Counterterrorism (CT)-related Arrests and Locates.        305        596
    CT-related Information and Indictments............        139        223
    CT-related Convictions and Pre-trial Diversions...        186        241
    FBI Field Computer Intrusion (CI) Squads/Teams....         10         16
    National Infrastructure Protection Center (NIPC)            6          3
     Crisis Action Teams Activated....................
    NIPC Threat and Warning Notices Issued............         33         36
    Key Assets Identified.............................      2,745      5,384
    Infragard chapters................................          8         31
    Infragard participants............................         18        392
    CI-related Arrests and Locates....................         40         62
    CI-related Information and Indictments............         49         66
    CI-related Convictions and Pre-trial Diversions...         54         62
    Health Care Fraud (HCF) Arrests and Locates.......        376        362
    HCF Information and Indictments...................        696        825
    HCF Convictions and Pre-trial Diversions..........        607        653
    HCF Recoveries and Restitutions ($000)............    312,861    581,517
    HCF Fines ($000)..................................     51,724    137,456
    ------------------------------------------------------------------------

        Criminal Enterprises and Public Integrity.--Our second national
    priority is crimes that affect the public safety or which undermine the
    integrity of American society. These investigations are often targeted
    at criminal organizations, such as the La Cosa Nostra, cartels and drug
    trafficking organizations, Asian criminal enterprises, and Russian
    organized crime groups that exploit social, economic, or political
    circumstances. Another focus within this area is public corruption and
    civil rights. For this area, we have established four strategic
    objectives:
      --Identify, disrupt, and dismantle existing and emerging organized
            criminal enterprises whose activities affect the United States;
      --Identify, disrupt, and dismantle targeted international and
            national drug-trafficking organizations;
      --Reduce public corruption at all levels of government with special
            emphasis on law enforcement operations; and
      --Deter civil rights violations through aggressive investigative and
            proactive measures.

                  KEY TIER 2 PERFORMANCE INDICATORS, 1999-2000
    ------------------------------------------------------------------------
                                                           1999       2000
    ------------------------------------------------------------------------
    U.S. based drug organizations affiliated with 13
     national priority targets that were:
        Identified....................................         64        201
        Dismantled....................................          8         16
    Percent of La Cosa Nostra members incarcerated....         18         22
    Eurasian Criminal Enterprises dismantled..........          3          6
    Asian Criminal Enterprises dismantled.............          4         15
    Safe Streets Task Forces (SSTFs)..................        165        175
    SSTF Arrests and Locates..........................     17,473     16,147
    SSTF Information and Indictments..................      2,049      1,989
    SSTF Convictions and Pre-trial Diversions.........      2,576      2,300
    Violent Gang Task Forces..........................         45         49
    Violent Gang Arrests and Locates..................        N/A      5,987
    Violent Gang Information and Indictments..........        N/A      2,549
    Violent Gang Convictions and Pre-trial Diversions.        N/A      2,315
    Violent Gangs affiliated with 7 national target            31         37
     groups that were dismantled......................
    Public Corruption (PC) Arrests and Locates........        355        422
    PC Information and Indictments....................        597        606
    PC Convictions and Pre-trial Diversions...........        552        551
    Civil Rights (CR) Arrests and Locates.............        240        145
    CR Information and Indictments....................        204        149
    CR Convictions and Pre-trial Diversions...........        257        195
    ------------------------------------------------------------------------

        Individuals and Property.--Our third national priority is crimes
    that affect individuals and property. Within this area, we will develop
    investigative strategies that reflect the public's expectation that the
    FBI will respond to and investigate serious criminal acts that affect
    the community and bring those responsible to justice. Our strategic
    goal for this area is:
      --Reduce the impact of the most significant crimes that affect
            individuals and property.

                   KEY TIER 3 PERFORMANCE MEASURES, 1999-2000
    ------------------------------------------------------------------------
                                                           1999       2000
    ------------------------------------------------------------------------
    Crimes Against Children (CAC) Resource Teams......         35         35
    CAC Arrests, Locates, Summons.....................        872      1,004
    CAC Information and Indictments...................        621        731
    CAC Convictions and Pre-trial Diversions..........        591        802
    Number of Missing Children Located................         90         92
    ``Innocent Images'' National Initiative (IINI)             10         14
     Undercover Operations............................
    IINI Arrests, Locates, Summons....................        337        482
    IINI Information and Indictments..................        307        421
    IINI Convictions and Pre-trial Diversions.........        315        476
    Safe Trails Task Forces (STTFs)...................          6          6
    Indian Country (IC) Arrests and Locates...........        668        733
    IC Information and Indictments....................        819        755
    IC Convictions and Pre-trial Diversions...........        726        735
    ------------------------------------------------------------------------
    [Note: In some instances, data shown reflects updated information from
      that presented in the Department of Justice Fiscal Year 2000
      Performance Report and Fiscal Year 2000 Performance Plan issued in
      April 2001.]

        Overall, during fiscal year 2000, FBI investigations led or
    contributed to the indictment of 19,134 individuals, the conviction of
    21,420 individuals, and the arrest of 36,387 persons on federal, state,
    local, or international charges. Additionally, FBI investigative
    efforts led or contributed to $946,811,505 in fines being levied,
    $1,012,851,257 in recoveries of stolen property, and $3,259,384,477 in
    court-ordered restitutions.
        To achieve the strategic objectives that we have identified, the
    FBI has developed five operational support strategies that are designed
    to build enhanced investigative capabilities and effectiveness. These
    operational support categories are: intelligence, information
    technology, applied science and engineering, management, and assistance
    to State, local, and international law enforcement partners.

                KEY SUPPORT PERFORMANCE INDICATORS, 1999 AND 2000
    ------------------------------------------------------------------------
                                                      1999          2000
    ------------------------------------------------------------------------
    Students trained, FBI Academy:
        New FBI Special Agents..................           718           312
        FBI employees (in-service, advanced)....        11,250        11,767
        Other federal, state, local, and                 4,881         5,796
         international..........................
    Other students trained (regional, local):
        State, local............................       117,599       120,233
        International...........................         7,105         7,709
            Countries represented...............           121           161
    Forensic examinations performed:
        Federal agencies........................       727,354       651,751
        Non-federal agencies....................       139,354       120,101
    Fingerprint identification services:
        Criminal cards processed................     5,926,920     8,577,911
        Civil card processed....................     6,496,415     6,743,428
        Civil submissions with criminal records.       565,929       701,164
        Civil submissions using false identity..        66,213        82,036
    National Crime Information Center (NCIC)       764,189,606   850,351,631
     transactions...............................
    National Instant Check System:
        Checks performed by States..............     3,480,832     4,511,866
        Checks performed by FBI.................     3,346,743     4,489,113
        Persons with criminal records prevented         62,189        71,890
         from purchasing firearms (FBI checks)..
    ------------------------------------------------------------------------

        For the fiscal year 2002 budget, FBI program managers continued to
    use the FBI Strategic Plan, 1998-2003, and the five operational support
    strategies as guides for developing their resource requirements.
    Through an integrated strategic planning and budget framework, the FBI
    has significantly sharpened its focus for allocating resources based
    upon national priorities and strategic objectives that concentrate on
    the most significant crime problems and threats to the Nation.
                  overview of fiscal year 2002 budget request
        For fiscal year 2002, the FBI is requesting a total of
    $3,507,109,000 and 24,938 permanent positions (10,420 agents) and
    24,490 workyears for its Salaries and Expenses ($3,505,859,000) and
    Construction ($1,250,000) appropriations. For FBI Salaries and
    Expenses, this amount represents a net increase of $277,377,000 from
    the current year and consists of $106,569,000 for adjustments to base
    and $170,808,000 for program increases. The adjustments to base include
    such items as the proposed 3.6 percent pay raise for fiscal year 2002,
    higher federal employee health insurance costs, additional General
    Services Administration (GSA) rent costs, and annualization of prior
    year increases and pay raises provided by Congress. Program increases
    proposed for fiscal year 2002 would provide 279 new positions,
    including 76 new agents, and $170,808,000 for four budget initiatives:
    Counter-intelligence; Counterterrorism; Cybercrime; and Infrastructure.
        In addition to direct funded resources, the fiscal year 2002 budget
    request assumes a total of 2,826 reimbursable workyears, including
    1,041 agents. Under the auspices of the Interagency Crime and Drug
    Enforcement (ICDE) program, the FBI would be reimbursed for a total of
    912 workyears, including 547 agents, and $115,436,000 for FBI drug and
    gang-related task force investigations and operations. Pursuant to the
    Health Insurance Portability and Accountability Act of 1996, the FBI
    will receive $101,000,000 in fiscal year 2002 to fund 793 workyears,
    including 465 agents, for health care fraud enforcement. For user fee
    programs of the Criminal Justice Services program, a total of 692
    workyears are planned, based on estimated fees. The remaining
    reimbursable workyears are used to facilitate a variety of other
    activities, including victim/witness assistance, name checks for other
    federal agencies, facility and maintenance support to other agencies
    sharing FBI facilities, pre-employment background investigations, and
    detail assignment to other agencies.
        At this point, I would like to describe in more detail the four
    budget initiatives proposed for fiscal year 2002.
                              counterintelligence
        Despite the fall of the Iron Curtain and the emergence of democracy
    in many of the countries formerly under the rule of communism, the
    threat posed to U.S. national, military, and economic security from
    foreign countries remains significant. Investigations in this area have
    become more complex as foreign intelligence services have expanded
    their focus from traditional military-related targets to new areas,
    including technology, intellectual property, economic espionage, and
    proliferation. The FBI continues to work closely with the intelligence
    community to identify and reduce the presence of hostile intelligence
    services in the United States.
        To keep pace with the changing counterintelligence threat to the
    United States, the FBI is proposing a counterintelligence initiative
    that would provide an additional $31,277,000 and 182 positions (62
    agents) in four areas of this mission-critical responsibility:
      --enhancing field investigative activities focused on identifying,
            preventing, and defeating intelligence operations conducted by
            any foreign power within the United States or against U.S.
            interests abroad that pose a threat to U.S. national security;
      --improving national-level program management and coordination of
            field investigative activities;
      --developing and acquiring technology to support FBI
            counterintelligence activities; and
      --improving security countermeasures to ensure the reliability of FBI
            personnel and contractors and security of information and
            facilities.
                                counterterrorism
        The United States continues to face a serious, credible threat from
    terrorists both abroad and at home. The number of groups and
    individuals capable of carrying out a terrorist act has increased over
    the past several years. Of continuing concern to the FBI are groups and
    individuals for which political or religious beliefs constitute
    sufficient motivation for carrying out a devastating terrorist act.
        To deal effectively with domestic and international terrorism, the
    FBI must concentrate on both prevention and response. The FBI's
    counterterrorism strategy is focused upon five inter-related elements
    to build and maintain an operational capacity for identifying,
    preventing, deterring, and investigating terrorist activities. First,
    the FBI must have the capacity to respond to acts of terrorism
    committed in the United States and abroad when those acts are directed
    against the U.S. government or its interests. Second, the FBI must have
    the capacity to receive, react to, and disseminate counterterrorism
    information. Third, the FBI must develop its internal capacities to
    support proactive counterterrorism programs and initiatives. Fourth,
    the FBI must have the capacity to establish and maintain sound and
    productive relationships with other domestic and foreign law
    enforcement and intelligence counterparts. Fifth, the FBI must have the
    capacity to use all of the necessary assets and capabilities of the FBI
    and other U.S. government agencies to support and initiate complex
    investigations and operations against domestic and international
    terrorists and terrorist organizations. For fiscal year 2002, the FBI
    is requesting increases totaling $32,059,000 and 42 positions (8
    agents) to improve and enhance existing counterterrorism capabilities
    and operations.
        2002 Winter Olympics Preparation.--The 2002 Winter Olympic Games
    have been designated a National Special Security Event. Consistent with
    FBI lead-agency responsibilities for intelligence collection and crisis
    management as contained in PDD-39 and PDD-62, the FBI is working
    closely with the United States Secret Service and other federal, State,
    and local law enforcement and consequence management agencies to plan
    for security and public safety issues for the 2002 Winter Olympic Games
    that will be hosted by Salt Lake City, Utah.
        For fiscal year 2002, the FBI requests increases totaling
    $12,302,000 for 2002 Winter Olympic Games deployment. The funding
    requested will cover travel, per diem, vehicle lease, utilities,
    telecommunications, and FBI overtime costs for the planned deployment
    of over 800 FBI personnel for the event period. The Salt Lake City
    games will be conducted at 20 official Olympic venues spread over a
    6,000 square mile area. Olympic competition will take place
    simultaneously at 10 venues in 3 major cities and 6 remote mountain
    resort areas.
        Recurring Security Services.--The FBI is committed to implementing
    the security standards contained in the June 1995 Department of Justice
    report entitled, ``Vulnerability Assessment of Federal Facilities.''
    FBI facilities are often the target of potential terrorist threats.
    Safeguarding agency employees and physical security must be a priority.
    For fiscal year 2002, the FBI requests an increase of $2,020,000 to
    acquire contract guard services for 6 stand-alone field office
    facilities where GSA does not provide such service ($1,600,000),
    replace an outdated closed-circuit television (CCTV) security system at
    FBI Headquarters ($320,000), and replace three guard booths at FBI
    Headquarters to facilitate new visitor identification procedures
    ($100,000).
        Incident Response Readiness.--Consistent with the provisions of
    PDD-62, the FBI initiated a long-term program in fiscal year 2000 to
    develop law enforcement capabilities for the technical resolution of a
    weapons of mass destruction incident involving chemical, biological, or
    radiological threats or devices. Initial funding for this effort was
    provided through an interagency agreement with the Department of
    Defense. For fiscal year 2002, the FBI requests 42 positions (8 agents)
    and $17,737,000 to support ongoing efforts in the areas of threat
    assessment, diagnostics, and advanced render safe equipment.
                                   cybercrime
        In recent years, technological advances have fundamentally changed
    the way of life in this country. Computers and networks allow millions
    of individuals to access, on a daily basis, a broad range of
    information services, databases, commerce, and communications
    capabilities that were previously unavailable. A combination of reduced
    cost for computer technology and increased storage capacity allows the
    accumulation, storage, and management of large amounts of information
    by individuals on personal computers and peripheral devices. Many FBI
    investigations, especially those involving organized crime, drug
    trafficking, crimes against children, white-collar crime,
    counterintelligence, and counterterrorism, are encountering the use of
    computer technology to facilitate illegal activities. As a result, the
    FBI must develop the investigative and forensic capacities and
    capabilities to deal with the use of computer technology by criminals
    and others to commit crimes or undermine national security. For fiscal
    year 2002, the FBI is requesting an increase of 33 positions (6 agents)
    and $28,144,000 for providing specialized technical assistance to field
    investigators and for developing investigative tools for law
    enforcement to counter the use of digital technology by criminals,
    terrorists, and others.
        Technical Support to Field Offices.--Criminals and other subjects
    of FBI investigations are employing advanced, complex physical and
    electronic security technology to protect their operations from
    competing criminal groups and to thwart law enforcement from executing
    lawful searches of premises and conducting court-approved interceptions
    of communications. The ability of the FBI to overcome such defensive
    measures is often critical to the success of high profile
    investigations and operations and the collection of evidence. The FBI's
    Laboratory Division provides technical support to FBI field offices, as
    well as the Drug Enforcement Administration, United States Customs
    Service, and other federal, state, and local law enforcement
    encountering such problems. To be able to continue providing this
    assistance, the FBI is requesting an increase of 10 positions (4
    agents) and $1,358,000.
        Network Data Interception.--In the Omnibus Safe Streets Act of
    1968, as amended, Congress provided the FBI with the basic legal
    authority to conduct the interception of oral, wire, or electronic
    communications in criminal investigations. The statutory authority to
    intercept communications in national security cases was provided by
    Congress in the Foreign Intelligence Surveillance Act. The use of
    court-authorized intercepts is the investigative tool of last resort,
    and allowed only after all other logical investigative avenues are
    exhausted. Often, the evidence collected through the use of court-
    authorized intercepts of communications is critical to the prosecution
    of criminal enterprise leadership who are otherwise able to insulate
    themselves through the use of intermediaries from direct ties to
    criminal acts and illegal activities. The increasing use of the
    Internet and world-wide web by criminals, terrorists, and intelligence
    agents to commit illegal acts and carry out conspiracies against U.S.
    national security has presented the FBI and law enforcement with new
    challenges in conducting court-approved interceptions of communications
    and obtaining evidence and intelligence.
        Increasingly, affidavits for the interception of communications are
    including e-mails, file transfers, and Internet Relay Chat messages,
    within the scope of court orders. Emerging new digital technologies,
    such as Internet telephony, digital subscription lines, cable Internet,
    wireless Internet, and satellite communications, are likely to be
    exploited by criminals and others in their continuing efforts to thwart
    law enforcement detection. Law enforcement requires the development of
    capabilities and techniques for conducting court-approved interceptions
    of communications in existing and emerging digital environments.
        For fiscal year 2002, the FBI requests an increase of 7 positions
    (2 agents) and $7,664,000 to develop and procure network digital
    interception technologies; to provide on-site assistance to field
    offices, pursuant to court-approved orders; and to provide training to
    FBI technically trained agents.
        Counterencryption.--The widespread use of digitally-based
    technologies and the expansion of computer networks incorporating
    privacy features and capabilities through the use of cryptography
    presents a significant challenge to the continued ability of law
    enforcement to use existing electronic surveillance authorities. The
    FBI is already encountering strong encryption in criminal and national
    security investigations. In 1999, 53 new investigations encountered
    encryption. The need for a law enforcement cryptanalytic capability is
    well documented in several studies, including the National Research
    Council's 1996 report entitled, ``Cryptography's Role in Securing the
    Information Society.'' The report recommends high priority be given to
    the development of technical capabilities, such as signal analysis and
    decryption, to assist law enforcement in coping with technological
    challenges.
        The Administration supports the enhancement of a centralized law
    enforcement capability within the FBI for engineering, processing, and
    decrypting lawfully intercepted digital communications and
    electronically stored information. For fiscal year 2002, the FBI
    requests an increase of $7,000,000 to further develop an initial
    operating capability that will allow law enforcement to obtain plain
    text and meet the public safety challenges posed by the criminal use of
    encryption. With this funding, the FBI intends to work with existing
    national laboratories and other government agencies to ensure all
    existing resources are used in executing processing functions. This
    approach will prevent duplication of effort. Additionally, the FBI
    plans to acquire necessary computer hardware, software tools, technical
    expertise, and services to develop capacities in four counterencryption
    program areas: (1) analytical engineering; (2) signal analysis
    research; (3) counterencryption deployment; and (4) industry-assisted
    technology transfer. The FBI also requests an increase of 13 positions
    and $1,202,000 for the collection and examination of evidence (devices
    and communications) which include encrypted materials and other
    electronic analysis forensic and technical examinations.
        Electronic Surveillance Data Management System.--With funding
    appropriated by Congress in fiscal year 2001, the FBI is acquiring and
    installing new digital collection systems to update existing analog
    equipment currently being used in FBI field offices. For fiscal year
    2002, the FBI requests an increase of 3 positions and $10,920,000 for
    the Casa de Web project which would serve as a distributed database
    that provides agents and analysts with access to minimized (not
    unprocessed) recordings of audio, data, and reports generated by
    digital collection systems. The Casa de Web system will consist of two
    separate databases, one for criminal law enforcement data and one for
    foreign counterintelligence data. This separation ensures compliance
    with Executive Order 12333 that prohibits the commingling of such
    materials. Firewalls and security protocols will prevent data from
    being accessed by unauthorized users and prevent external access of the
    system. The Casa de Web project is being coordinated with Trilogy, the
    FBI's information technology upgrade program.
        Casa de Web will allow authorized agents, analysts, and translators
    to share and analyze minimized data on an inter and intra office basis.
    Analytical tools planned for Casa de Web, such as key word speaker
    identification, and speech recognition, will improve information and
    intelligence sharing capabilities and permit FBI Agents and analysts to
    view, listen, and act on collected minimized electronic surveillance
    information on a more timely basis.
                                 infrastructure
        To be successful, the FBI must have the capacity for collecting,
    storing, managing, analyzing, and disseminating case and intelligence
    information on a timely basis to its own investigative personnel, as
    well as other federal, State, and local law enforcement and the
    intelligence community. Existing systems and capacities must be
    upgraded to meet increased investigative demands. New technologies also
    present opportunities for making for effective and timely use of case
    information and intelligence currently being collected. On a daily
    basis, the FBI depends on its core infrastructure to ensure its agents
    and support staff can perform their jobs. A strong, solid
    infrastructure is necessary for providing everyday tools and services,
    such as replacement and safe automobiles for responding to and
    conducting investigations and equipment and supplies for conducting
    forensic examinations of evidence.
        Trilogy.--Trilogy is the FBI's three-year information technology
    infrastructure upgrade initiative. Trilogy consists of three key
    components: User Applications, a collection of user-specific software
    applications and tools to enhance the ability of agents and support
    employees to organize, access, and analyze information; Information
    Presentation, replacement computer hardware and office automation
    software within each office to link employees at their desks with
    counterparts throughout the FBI; and Network, upgrades to acquire high-
    speed local and wide area networks and telecommunication circuits to
    deliver information between users and locations securely and quickly.
        Congress provided the approval to proceed with the first year of
    the Trilogy implementation plan in fiscal year 2001 and authorized the
    expenditure of $100,700,000 in appropriated and unobligated prior year
    funds. Since receiving approval to proceed with this project, the FBI
    acquired the services of Mitretek Systems to provide management and
    technical assistance to the FBI Trilogy Program Office and the services
    of GSA's Federal Systems Integration and Management Center (FEDSIM) to
    act as the acquisition agent for the project. The FBI also selected the
    GSA Millenia contract as the acquisition vehicle for the project. In
    January 2001, the FBI, through FEDSIM, issued two task order requests
    (TORs) to the Millenia contractors. One TOR addresses the User
    Applications component of Trilogy, while the second TOR addresses the
    Information Presentation and Network components. In April 2001, after
    separately reviewing vendor proposals for both TORs, the FBI selected
    vendors. Contractor work is expected to commence by June 2001.
        Second year implementation costs of the Trilogy project are
    estimated at $142,390,000. To help meet this requirement, the FBI plans
    to allocate $38,230,000 of existing base funding and apply $36,500,000
    of unobligated prior year funds toward Trilogy in fiscal year 2002. To
    complete second year funding requirements, an enhancement of
    $67,660,000 is required. Second year activities of the Trilogy project
    will focus on implementing multi-case analytical tools, intranet
    upgrades, and multi-media electronic case files; continuing office
    automation upgrades in field offices; and continuing upgrades to local
    and wide-area networks and telecommunications circuits. The third year
    of implementation will complete the office automation upgrades in field
    offices and at Headquarters, provide for additional wide-area network
    circuits, and permit additional improvements to FBI case databases.
        Telecommunications Services.--An enhancement of $6,500,000 is
    requested to begin the replacement and upgrade of telecommunications
    equipment used to provide connectivity between FBI legal attache
    offices and the Department of State's (DOS) worldwide network and to
    provide telecommunications support for FBI participation in High
    Intensity Drug Trafficking Area (HIDTA) multi-agency investigations and
    meet special case needs. The DOS Diplomatic Telecommunications Service
    (DTS) is upgrading its telecommunications network over the next five
    years. This upgrade will require the FBI to replace its legacy
    equipment with new equipment compatible with the DTS network.
        Motor Vehicle Program.--An increase of $4,007,000 is requested for
    the FBI motor vehicle program, including $2,557,000 to replace an
    additional 110 vehicles with mileage exceeding 80,000 miles, $450,000
    for automotive diagnostic tools, and $1,000,000 to upgrade the Vehicle
    Management System to enhance fleet management and maintenance.
        FBI Laboratory Activation.--Occupancy of the new FBI Laboratory
    facility at Quantico, Virginia, is scheduled to begin in Summer 2002.
    Activation of the facility will require an increase of 22 buildings and
    facilities management employees and $1,161,000 to properly operate and
    maintain the new building.
        Additionally, the fiscal year 2002 budget proposes that $40,000,000
    from the Department of Justice Working Capital Fund be used to meet
    costs associated with the activation of the new facility. These costs
    include the following:
      --$3,868,750 for the transfer of 125 Laboratory Division employees;
      --$15,000,000 for general and specialized equipment;
      --$4,695,812 for office furniture and shelving;
      --$600,000 for information technology equipment, such as network
            routers, hubs, and multiple access units;
      --$908,438 for moving services;
      --$792,000 for part-year fiscal year 2002 operations and maintenance
            costs, such as utilities; maintenance supplies; environmental
            testing, trash removal, and other miscellaneous services; and
            housekeeping, landscaping, and other building maintenance; and
      --$14,135,000 for decommissioning and renovation/alteration of
            existing Laboratory Division space in the J. Edgar Hoover
            Building being vacated. This amount includes $3,000,000 for
            abatement and clean-up activities and disposal of hazardous
            materials/waste and $11,135,000 for renovations and alterations
            of approximately 131,000 square feet of space.
                     related departmental funding requests
        Mr. Chairman, I would like to highlight several requests for
    funding included within other Department of Justice programs that are
    considered important to FBI initiatives and programs.
        State and Local Bomb Technician Equipment.--Within the funding
    proposed for the Office of Justice Programs (OJP), $10,000,000 is
    included to continue an FBI Laboratory-managed program of training and
    equipping approximately 386 accredited State and local bomb squads
    located in communities throughout the United States.
        Continuation of funding for this program will ensure State and
    local bomb squads are properly trained and equipped to deal traditional
    improvised and explosive devices, as well as the initial response to
    devices that may be used by terrorists or others to release chemical or
    biological agents. Through this program, the FBI has provided State and
    local bomb squads with weapons of mass destruction (WMD) protective
    search suits, real-time x-ray devices, multi-gas monitoring systems,
    portable radiation detectors, and computers to access the Chemical and
    Biological Organisms--Law Enforcement database. This initiative
    compliments the State and local bomb technician training and
    accreditation program that the FBI Laboratory provides at the Hazardous
    Devices School, Redstone Arsenal, Alabama.
        Grants for DNA Convicted Offender and Crime Scene Backlog
    Reduction.--Also, requested under Community Oriented Policing Services
    (COPS) program is $35,000,000 for grants to reduce the backlog of DNA
    profiles for entry into the FBI's national Combined DNA Information
    System (CODIS) database ($15,000,000), and to reduce the backlog of
    crime scene evidence awaiting DNA testing ($20,000,000). These
    proposals are related to several on-going FBI Laboratory initiatives
    for improving State and local crime-fighting and forensic capabilities.
        White-Collar Crime.--The OJP, Justice Assistance appropriation
    proposes $9,230,000 for the operations of the National White-Collar
    Crime Center (NW3C). The FBI has entered into a partnership with the
    NW3C to staff the Internet Fraud Complaint Center (IFCC), which opened
    in May 2000. The IFCC serves as a focal point for receiving and
    analyzing complaints from citizens and private industry victimized by
    Internet fraud and as a resource to federal, State, and local law
    enforcement and regulatory agencies.
                             legislative proposals
        Mr. Chairman, the fiscal year 2002 budget request includes several
    general provisions proposed by the FBI, including: danger pay, foreign
    cooperative agreements, railroad police training, and warranty
    reimbursement authorities. I encourage the Subcommittee to include
    these general provisions as part of the fiscal year 2002 Justice
    Appropriations Act.
        Danger Pay.--Section 108 would extend to the FBI the same authority
    that the Drug Enforcement Administration (DEA) currently enjoys for
    authorizing danger pay for personnel assigned to high risk overseas
    locations. For the FBI, this is both a pay equity issue for FBI Agents
    assigned to DEA Country Offices and a recognition of the increased
    threat facing FBI personnel performing extraterritorial investigations
    in foreign locations due to our counterterrorism responsibilities. At
    times, FBI personnel are deployed to overseas locations where, due to
    the nature of our work, they face a threat or hostile environment that
    does not always extend to all members of the United States diplomatic
    team in a particular country. This authority would allow me to address
    those situations. This authority has been requested by the
    Administration in each of the past three budgets.
        Foreign Cooperative Agreements.--Section 109 would allow the FBI to
    credit to its appropriation funding that is received from friendly
    foreign governments for that country's share of joint, cooperative
    projects with the FBI. This authority would facilitate projects with
    friendly foreign governments, especially in support of our national
    security mission. The authority was first proposed by the
    Administration last year, was adopted by the House, but did not make
    its way into the final Conference bill.
        Railroad Police Training.--Section 110 would allow the FBI to
    establish and collect a fee to pay for the costs of railroad police
    officers participating in FBI law enforcement training programs
    authorized by Public Law 106-110, and to credit those fees to its
    Salaries and Expenses appropriation to cover the costs of providing
    such training. Public Law 106-110 authorized railroad police officers
    to attend FBI training programs, but directed that no federal funds be
    used to provide such training. Railroad police officers are willing to
    pay for such training; however, the law does not provide an authority
    for the FBI to collect and retain the fees to pay for the training.
    This provision provides the requisite authority.
        Reimbursement for In-house Warranty Work.--Section 111 would allow
    the Attorney General to seek and retain reimbursement from vendors for
    warranty repairs and maintenance performed in-house by Department of
    Justice employees when it is not possible for the vendor to perform
    such services. For example, FBI motor vehicles are equipped with radios
    that use government encryption devices. As a result, these vehicles
    cannot be left unattended at vendor repair facilities for servicing.
    FBI mechanics currently perform warranty work that normally would be
    provided at no cost by the vendor. Many vendors are willing to
    reimburse or credit the FBI for the cost of the warranty work provided
    in-house. This provision would provide the authority needed to enter
    into such agreements when there is a law enforcement, security, or
    mission-related reason that precludes vendor servicing and permits the
    crediting of payments received to the appropriate appropriation.
                                    summary
        Mr. Chairman, I am especially proud of the work being performed
    everyday by the employees of the FBI. Their ability to do that work--
    the work asked of us by the Congress through the laws it passes, by the
    President through executive orders, and by our federal, state, local,
    and international law enforcement partners--is a reflection of the
    strong fiscal support given to the FBI by this Subcommittee.
        The budget proposed for the FBI for fiscal year 2002 addresses
    critical resource needs identified through our Strategic Planning
    process. These important investments will allow the FBI to meet the
    investigative and technological challenges we face as the FBI enters
    the 21st Century. These investments will also enable us to develop the
    core competencies that will allow us to be successful in investigating
    crimes, protecting national security, developing and sharing technical
    and forensic expertise, and working better with our federal, state,
    local, and international partners. I believe that the national
    priorities and objectives we have put forth reflect the expectations
    for the FBI that are held by the American people, as well as the
    Congress.
        Congress, and this Subcommittee in particular, has been extremely
    generous in its financial support of the FBI over the past several
    years. Our successes in the field, whether they be preventing
    pedophiles from luring children over the Internet, to bringing
    terrorists from foreign lands back to the United States to stand trial
    for their actions, to protecting our Nation's critical infrastructure
    from cyber attacks, to fostering greater cooperation with foreign law
    enforcement through our Legal Attache Offices, were made possible
    because of your support for the FBI. As we look forward to fiscal year
    2002, I am hopeful that we can continue to depend upon your support.
        Again, I thank you for this opportunity to appear before the
    Subcommittee.

                                Encryption issue

        Senator Gregg. It would be helpful on the encryption issue
    if you could send us, before you depart, a memo listing where
    you think Congress could take action to be constructive in this
    area. You have noted a couple places, but this is such a big
    issue and such a difficult issue, if you could give us your
    parting thoughts on----
        Mr. Freeh. Yes, sir.
        Senator Gregg [continuing]. Where you think agreements can
    be reached, either legislatively or through some sort of
    compact of understanding between law enforcement and the people
    who produce the products that encrypt these different
    communication devices.
        Mr. Freeh. Pleased to do that.
        Senator Gregg. Senator Hollings, you were not here. I made
    a brief opening statement reflecting----
        Senator Hollings. You go ahead with your questions, because
    I have questions here.
        Senator Gregg. Well, go ahead.

                             Mc Veigh matter error

        Senator Hollings. All right.
        Mr. Director, let the record show that I have had a long
    affiliation with the Federal Bureau of Investigation. Back in
    1954, I served on the Hoover Commission, the task force
    investigating the intelligence activities.
        I came to the old Senate office building, which is now
    known as the Russell Building. And the Director, Mr. Hoover,
    turned over a cardboard box full of all the McCarthy charges to
    General Clark and myself, and I sat down at the GAO building
    and went over all of those with the Director.
        Since that time, I have been over 30 years here at the
    appropriation subcommittee level of the Federal Bureau of
    Investigation, I am an honorary FBI agent. So I speak with
    affection and admiration for the department.
        But let me ask you, I keep reading here in the last few
    days about this error. Is that your position that this was just
    an error, something that just slipped through the cracks?
        Mr. Freeh. Yes, sir, it is. It was a grievous error and one
    that should not have occurred, given the number of requests
    that were made. The only context in which to place it is the
    context of volume, in terms of the millions and millions of
    records that were part of the discovery agreement and the
    several hundred that were not.
        But my information at this point is that this was an error.
    This was an oversight. The Inspector General of the Department
    of Justice is conducting a thorough investigation.
        But I have no reason at this point to think that it was
    anything but an error. This error was brought to the attention
    of the court and the defendant by the FBI, by FBI analysts who
    were archiving all of the records of the case.
        Now, the archiving statute requires that this be done in 25
    years. They decided to do it in year three. Instead of just
    putting the documents in boxes and filing them away, which is
    all they were legally required to do, they started to check all
    of these documents against the database. When they discovered
    that some of them were not in this database, they reported
    this.
        So I do believe it was an error, a terrible error, and one
    that I think we can take steps to correct. I also think it will
    not affect justice in this case.
        Senator Hollings. Specifically, so everyone will
    understand, the record ought to show that the Office of the
    Inspector General has an exceptional assignment with the
    Federal Bureau, in that they are not regularly, as the OIG
    would do in any other governmental department, looking and
    reviewing for fear that they would mess up a case or whatever
    it is. Usually these things are handled by the Office of
    Professional Management or whatever it is in the Department.
        But in addition to the claims of an error, there has been
    inference too that we may have had improper or antiquated
    computerization. Is that the case?
        Mr. Freeh. I do not believe that was the case here,
    Senator. And again, I have looked at this as carefully as I can
    look at it without conducting a separate investigation. But I
    do not think this was a computer failure here.
        All of the materials that got to Oklahoma City were
    uploaded into their database, and those are reliably there.
    This is what was not either given to Oklahoma City or had not
    found its way into the database.
        So it is really not a computer failure. It is a human
    failure, and one which goes to the basics: keeping records and
    making them available when requested.

                Congressional automation funding and FBI culture

        Senator Hollings. Well, overall, let the record show that
    in the last 10 years, this subcommittee of the Congress has
    appropriated $1.81 billion for that automation communications
    computerization. So we never have been conservative or puny or
    denied the FBI request, because we know, at the subcommittee
    level, from experience that if you go down on the floor and the
    FBI has not been provided for, an FBI add-on amendment would
    easily pass. No one wants to vote against the FBI.
        The record should show that over the 10 years we have
    appropriated--you have requested $29.3 billion, and we have
    appropriated $28.714 billion. So we have given you 99 percent
    of your requests.
        I wanted to make sure of that, because I have seen some
    coverage of this, and it is my considered opinion from
    experience that this is not just an error. On the contrary, Mr.
    Director, this is the culture in the bureau.

                          FBI discovery process errors

        And the reason for that is, I know of other similar cases.
    I don't want to use the committee's time in getting to all of
    the cases, but let me refer to the Lost Trust case that we had
    down in the State of South Carolina that the judge asked the
    Department of Justice to look in.
        The OIG, Office of Inspector General, went to work and made
    its report through the Office of Professional Management. And
    thereafter, the Office of Inspector General wasn't satisfied.
    They continued the investigation over the last 10 years. And
    they filed in February this year this voluminous report.
        And what happened was, they had been defending these
    misdoers in the legislature in the State of South Carolina,
    they had been defending two former U.S. attorneys, so they knew
    the ropes. They knew the game.
        And they knew, for example, about these 302s. When an FBI
    agent interviews a witness, they make notes, and that is called
    a 302 memo. And they knew different 302 memos were made about
    payoffs and everything of that kind.
        And let me quote something, so you will understand why I
    even ask the questions, and the record ought to reflect it. And
    I quote, ``As set out in this report, we are critical of the
    government's management in its discovery obligations.'' This
    was way in the mid-1990s.
        ``An embarrassing amount of arguably disclosable material
    was not found, considered or produced during discovery. We are
    critical of the FBI's failure to attend to this responsibility,
    to provide effective assistance or supervision to new,
    overworked special agents, to seek guidance from the U.S.
    Attorneys Office, or to apply resources necessary to support
    the investigation and trial.''
        Later on, with respect to agent Michael Clemens on his
    several FBI 302s, his memos, quote, ``The controversy arose in
    part because the FBI 302s were not produced in discovery and in
    part because the substance of the reports led to allegations
    that their nonproduction was based upon the government's
    intention to allow Cobb to testify inconsistently or
    perjuriously at trial.''
        Cobb was a special undercover agent that they had. I read
    further.
        The OIG report notes, quote, ``FBI 302s covered by standard
    discovery requirements were not produced. Indeed, some were not
    even located and considered for possible production during the
    first wave of prosecutions in 1990.''
        Then, ``During the second wave,'' that same quote, ``During
    the second wave of prosecutions back in 1991, defense counsel
    called FBI Special Agent Clemens to testify, and Clemens was
    asked, `Did you do a 302 or anything concerning that debriefing
    of Mr. Cobb?' Clemens denied preparing an FBI 302. Assistant
    U.S. Attorney Barton argued to the court, `Defense counsel is
    looking for the secret 302 of Ron Cobb, where the payment to
    Lindsay is discussed. It does not exist.' ''
        That response was false.
        I am quoting further, ``The most remarkable fact concerning
    pretrial preparation for further trial, namely the Derrick
    trial, is that the FBI 302s that had not been provided in
    discovery in the Taylor, Blanding or Gordon cases were to a
    large extent given to Derrick, specifically the FBI 302 about
    payments to Senator Lindsay and Clemens that testified did not
    exist in February 1991 was produced in March 1991 to Derrick
    and his counsel.''
        I am still quoting, this is from the Office of Inspector
    General, ``Other FBI 302s that the district court would later
    conclude had been withheld purposefully from previous
    defendants also were produced during the discovery in the
    Derrick trial.''
        And finally, Mr. Director, ``We believe the FBI''--this is
    from the Office of Inspector General--``We believe the FBI
    supervisors had sufficient information to alert them to the
    fact that the discovery process was fraught with difficulties.
    We concluded that the deficiencies in the FBI's early pretrial
    preparation had an adverse impact on the subsequent trials and
    should have been dealt with more effectively and sooner. While
    the immediate fault for this discovery failure was Clemen's
    disorganization, his superiors contributed to this shortcoming
    by failing to guarantee adequate support,'' end quote.

                           errors in Mc Veigh matter

        You can see that is why I asked the question, because the
    OIG says they are not really getting support or direction or
    discipline, if you might say, from the Director and from the
    main office. Because you have in here, between August of 1995
    and November of 1996, this is your statement, sir: Eleven
    separate communications were sent to the field offices
    requesting that all evidence be sent to the OKBOMB command
    post.
        And nothing happened. It did not come in. And as recently
    as last week, you were still giving more directions. You
    finally made the local people sign off under oath that they had
    sent everything in, and then some Baltimore information came.
        So what we really have is a culture at the bureau that
    agents don't have to worry about even the top standing
    directors and everything else. We send what we can get our
    hands on. Some casually, perhaps; some intentionally, perhaps.
        But this thing should not be looked upon as an error. It
    should be looked upon as a culture and absolutely cleaned up.
        And there is no expert necessary. I know your abilities.
    You have outstanding abilities. And with this knowledge, I wish
    you were going to stay here because we could clean this thing
    up.
        Any comment?
        Mr. Freeh. Your insight and your comments are very much on
    the mark and very fair. Let me just say two things.
        I have no information and no evidence and no basis to
    believe at this point that there was anything done here
    purposefully. I think you could probably distinguish the
    situation we have here, which is an egregious one, and the one
    reflected in the report, which does find purposeful withholding
    and also finds that the substance in those 302s could have
    adversely affected the trial.
        I do not believe either of those circumstances are true
    here. But I do not know, and I could be mistaken. The Inspector
    General is going to do as thorough a job as they have done in
    other reviews, whether it is the laboratory or the Lost Trust
    case that you mentioned.
        There was an enormous amount of discovery here, and there
    was an extraordinary agreement. The agreement was any interview
    anywhere would be turned over. That is never called for under
    the Federal rules of criminal procedure or even discovery
    orders that many judges enter beyond the Rule 16 requirements.
    This was an extraordinary agreement to give them every single
    interview.
        In the course of that, they received thousands and
    thousands and thousands of interviews and had access to
    millions and millions of records.
        The questions now is twofold.
        One, whether there was a purposeful withholding. I agree
    with you, that it is a critical question that has to be
    answered. I see no evidence of that at this point.
        The other question is whether any of that information would
    go to the guilt or innocence of the defendant. My very strong
    belief at this point, as well as the prosecutors who have
    looked at it, is that this is not the case. A judge is going to
    decide that, and perhaps, may come out differently. But I do
    not see either a purposeful withholding here or materials that
    go to the guilt or innocence of someone.
        That is not to diminish the seriousness and the
    egregiousness of this matter, which I have accepted as such and
    will take some sincere efforts to change.

                              FBI culture problem

        Senator Gregg. Could you address Senator Hollings' point,
    though, on culture?
        Senator Hollings. In addressing that, if you do not mind--
    excuse me, Mr. Chairman--you and I are both lawyers. The law
    presumes a purposeful nature of the natural consequences of
    your act.
        I was looking at this case of the young lad convicted down
    there in Florida. He claims that the trigger went off. If I
    fire a pistol down Constitution Avenue and six blocks down
    somebody gets hit, drops dead, I cannot throw up my hands,
    ``Oh, I did not even know him. I did not have any intent of
    killing that fellow.'' That is nonsense.
        And the same with the fellow who aims a gun at someone
    right between the eyes and claims that the trigger went off
    accidently. ``I did not think it would go off.''
        Similarly here on the purposeful nature, when you come in
    and you, as the Director--boy, this would really tee me off if
    I was the director--send 11 separate communications--these are
    your words--to the field offices requesting all evidence to be
    sent in. That is back in 1996. And here you are 5 years later,
    2001, still sending up directives and still getting information
    from Baltimore.
        So don't say it was not purposeful. It is the culture.
    Excuse me. And answer the chairman's question about culture.
        Senator Gregg. Actually, it was your question. I just----
        Senator Hollings. Yes, sir.
        You are right.
        Senator Gregg. I thought it was a good point and wanted to
    just hear----
        Mr. Freeh. It is a good point. I think there is a cultural
    problem here by not taking seriously the very clear and
    explicit commands that were given in a very important case.
        But in any case, if a field office is required and asked
    specifically and unquestionably to send in all materials
    relating to a case, the culture ought to take that with the
    seriousness that would result in a complete, timely disclosure
    and dissemination, which was not the case here.
        That is a cultural defect, which I will attempt to address
    by the stand-down that we are going to do, by all the different
    training protocols and efforts and interests that I can bring
    to bear on this problem.
        Senator Hollings. Yes. Don't hire anybody. Fire some
    people. Make them accountable. They will know. They will
    understand. Until you do that, they will play the game.
        When they ignore 11 separate communications from the
    Director back in 1996 and you are still having to say, ``The
    only way I can catch you is to make you under oath sign a
    statement that you have sent the information in,'' that is
    pretty poor administration.
        Some heads ought to roll where they didn't respond to these
    communications appropriately.
        And incidentally, as lawyers, we are not to determine at
    the FBI level whether it is material to the case or not. It is
    the defense counsel's decision. You have to give it all to them
    in discovery, and let him decide.
        Mr. Freeh. Yes. You are absolutely right.
        Senator Gregg. Thank you.
        Senator Hollings. Thank you, Mr. Chairman.

                            training and experience

        Senator Gregg. On the budget--this is a part of our hearing
    process--but obviously this issue goes to a very significant
    question which has to be resolved and which we intend to work
    with you on to try to make sure that it does not happen again.
        In fact, following up on that, we have had the lab issue,
    and we have had the rogue agent issue, and now we have the
    documents issue.
        Do you see another area where we may have such a system
    failure? I am sure if you do, you have already addressed it,
    but where should we take extra caution--that the Bureau might
    be overwhelmed and we could have a system failure?
        Mr. Freeh. I think it is in the training and experience
    level, and this is a demographic problem. We have the majority
    of our employees--the overwhelming majority of our employees
    with very small years of experience. I think 41 percent of our
    current FBI special agents have less than 6 years' experience,
    which means in major divisions the youngest agents, in some
    cases, are getting the most complex cases, the most difficult
    cases.
        On the support side, the technical side, we have also hired
    thousands of new employees over the last couple of years, not
    enhancements as much as replacements.
        So one of our intense internal concerns is the experience
    level, the training level. And there is much that can be
    learned on the job, but then there is a lot of things, which
    cannot be learned on the job; they have to be pre-trained and
    pre-ordered and pre-configured.
        So I think we are going to have in the next couple of years
    this shaking out period in terms of getting the training,
    particularly the academic type of training and the practical
    operations type of training. And we are taking some measures to
    do that, particularly in the computer area, but also in the
    basic areas, in white collar crime investigations, and in
    counterintelligence investigations.
        We do not have an FBI anymore where only a small percentage
    of new agents are running major cases. Now we have most of the
    major cases being run by relatively inexperienced agents.
        I think, in the long term, it is very good for the country,
    because I think if our attrition rate stays as it has stayed--
    very, very low--in another 4 or 5 years, we will probably be
    more competent in these areas than ever before in our history.
        In the meantime, the experience level, the training level,
    and the margin for error, is going to be at risk unless we can
    take active training measures and institutional measures to
    address that.
        And we are taking those problems, but that is a major
    concern.

                   analyses of training and automation needs

        Senator Gregg. Well, if you see that coming, maybe you
    could give us an assessment of it, of how you are trying to
    manage that issue. A little more complete analysis of it, and
    how you are trying to manage it, so that we could see if there
    is something there that we can be of assistance on.
        As a tangential point, one of our concerns on this
    committee--I know, Senator Hollings' concern and my concern--
    has been the tooling up of the lab and the tooling up of the
    technology capability of the computers, not only on the
    hardware side but on the people side. In particular, getting
    the good people and keeping them in a competitive marketplace,
    maybe a little less competitive than a year ago, but still a
    competitive marketplace.
        So could you give us an analysis of where you are and what
    you need in both of those areas?
        Mr. Freeh. Yes. With respect to the computer training, we
    have, as you mentioned, a challenge here that is going to go
    beyond the basic computing challenge into the practical
    application of what all of these investigators are going to be
    expected to do in the information age.
        We have a ``train the trainer'' program, which we are
    actively perpetuating and particularly now directed at our card
    examiners. We have, as you know, a limited number of card
    examiners. You have given us the wherewithal to increase that
    support, and make some conversions to full-time examiners. But
    the training of the trainers in that area is going to be a
    major focus.
        The second level will be the evidence response technicians,
    who are not only required to work crime scenes and exploit
    physical evidence, but also hard-drive and computer evidence,
    which is almost as routine as everything else. The technicians
    in all of these different areas, particularly card related, is
    going to be a major challenge for us.
        Dr. Kerr, who you know, the Director of our laboratory, is
    working with the Training Division to develop this tiered
    approach: train the trainers; get to the technicians in the
    field; and make sure that the equipment, which is coming on-
    line, particularly new laboratory equipment, is going to be
    exploitable and usable, whether we are working a crime scene in
    the United States or someplace else.

                   State forensic computer technology centers

        Senator Gregg. Can I break in there?
        We are getting a fair amount of pressure in this committee
    to create forensic computer technology centers at the State
    level. A lot of States are now asking us to try to get some
    Federal funds to do that.
        Is it a good idea for there to be State forensic computer
    capability or should it be regional?
        Mr. Freeh. I think you are going to need to do both, Mr.
    Chairman, in the years to come, because the number of
    examinations is exploding.
        We had 3,400 computer forensic searches, examinations in
    fiscal year 2000 and estimated 5,494 for fiscal year 2001. We
    expect about 9,000 or more in fiscal year 2002.
        I think you are going to need an enhanced regional ability,
    but I think it is also going to devolve down to the State
    level. So just like they now manage fingerprint evidence in
    many local laboratories, the computer evidence is going to
    become as routine.
        The San Diego lab, the regional computer forensic lab,
    which was funded here, has been a remarkable success as a
    regional operation. There is one in Texas, which we are also
    participating in.
        I think this is a good format for certainly coordinating
    State and Federal resources and responses in that area. But I
    think the States on their own are going to need this capacity.
        What I would recommend is that if we build this bridge from
    two sides, which is maybe the best way to build a bridge, we
    should coordinate what we are doing. It would be a very good
    investment to ensure that the Federal efforts, particularly the
    ones coming out of the FBI, and its regional forensic labs, are
    coordinated and that they are interfacing with large
    investments into State or local capability. What you want is a
    national law enforcement computing ability in this particular
    area. And, we should interface like national labs interface on
    their technology issues. I think that is the way to build the
    bridge.

                          Lab and equipment situation

        Senator Gregg. I broke into your statement. Were you going
    to tell us about the lab situation and equipment there?
        Mr. Freeh. With respect to the laboratory, the activation
    and the operation is, as you know, scheduled for the summer of
    2002. And that is moving along on time and under budget.
        The laboratory will provide world-class forensic services,
    not just for the FBI but for State and local partners, much
    like our criminal justice information systems in West Virginia
    provide on the informational side.
        The laboratory will also have a very significant research
    and development component, which our laboratory now has in the
    Engineering Research Facility (ERF) at Quantico, as well as the
    forensic laboratory capability of Quantico.
        But this will give us, right alongside the workbench,
    Research and Development (R&D) capability where we can
    hopefully attract and get scientists from other law enforcement
    departments and from universities.
        We have now several scientists working with our laboratory
    from local universities. We want to integrate this R&D with not
    just national laboratories but also the private sector.
        The other aspect of it is we are designing this facility to
    be a teaching laboratory. In addition to providing forensic
    services, we can also bring in State and local scientists. We
    can have faculty that are experts themselves in teaching. We
    can also use technology for long-distance learning, as well as
    information technologies to help compare and work on actual
    cases.
        This laboratory will give us a strength in the forensic
    area that we have not had. We have mostly been a reactive
    laboratory over the years. And what happens is the number of
    requests build up and every year there is more and more of a
    backlog. This will not simply address the backlog, but it will
    give the State and local laboratories enhanced abilities where
    they will be able to do a lot of this technology and
    examinations by themselves.
        We want to have the laboratory doing what they did in the
    mitochondrial DNA area. That was a FBI-developed forensic tool
    of immense investigative value. We can make a case out of a
    genetic sample, which could not be made in any other way but
    for the mitochondrial technique developed in our laboratory.
        There are probably all kinds of things that can be done in
    that regard. There are laboratories around the world that do
    things that we do not. This will be, on the R&D side and the
    teaching side, hopefully, a center of expertise that we have
    not had in the past.

                      role of Dr. Kerr in Lab improvement

        Senator Gregg. Senator Domenici?
        Senator Domenici. Mr. Chairman, I have no questions.
        I am assuming this is the last appearance of the Director
    before this subcommittee, and I just want to personally and on
    behalf of my constituents thank you for the job you have done
    and wish you the very best.
        I am hopeful that your laboratory will improve, and I
    wholeheartedly support the ideas you have just described.
        Mr. Freeh. Thank you.
        Senator Domenici. I gather that Dr. Kerr is still there
    with you.
        Mr. Freeh. Yes, sir, he is.
        Senator Domenici. And you are finding him to be quite a
    scientist in helping you build this laboratory? Or how would
    you assess it?
        Mr. Freeh. We could not build it without him. And I think
    the vision that he has for its future is one that we had to
    import. We did not have it in the FBI.
        We had, as you know, for many years, assistant directors
    who were sometimes scientists, mostly not, running the
    laboratory. They did a fairly respectable job.
        But in terms of research, teaching, peer review, and state-
    of-the-art capabilities, we needed to bring in somebody of his
    caliber. So that was one of the good decisions I made.
        Senator Domenici. I might just say that the doctor that I
    referred to at one point in his life was the director of the
    National Laboratory at Los Alamos, and was out looking for
    work, doing something else, and he was recruited.
        And I gather that from the day he came on, there has been
    just tremendous changes in what we are going to be doing in
    that laboratory and how we do it.
        Mr. Freeh. Yes, sir.
        Senator Domenici. Thank you very much.
        Thank you, Mr. Chairman.
        Senator Gregg. Thank you, Senator.

                        Polygraphs and national security

        Senator Hollings. Mr. Director, I know polygraphs are not
    conclusive, but they are good indicators. What is the policy at
    the bureau for its agents?
        Mr. Freeh. We polygraph all new employees who come into the
    FBI. We have done that since 1994. We have regularly
    polygraphed people who work in our most sensitive
    counterintelligence programs.
        Prior to the recent espionage case, for instance, 73
    percent of the agents in the National Security Division were
    polygraphed because of the sensitive matters on which they were
    working.
        We have not had a random polygraph policy. We have not had
    a policy that went beyond the national security context that I
    just described.
        We are waiting now for Judge Webster's specific
    recommendations on this area. With his permission and consent,
    in the interim, we have taken some steps to broaden the pool of
    individuals who should be polygraphed. We have also taken some
    steps in the information assurance area by protecting the
    computerized information systems that we have from people going
    into them who should not go into them.
        We are also taking some steps on the whole security
    program, making significant changes in both the structure and
    leadership of that program and the resources needed to support
    it.
        Senator Hollings. It is interesting you note that it
    started in 1994. I know, serving on the Intelligence Committee
    here in the Senate back in the 1980s, you could not get a job
    on the Capitol police force unless you were polygraphed.
        When last was Hanssen polygraphed?
        Mr. Freeh. He was not polygraphed.
        Senator Hollings. I see.
        And the Hoover Commission recommended 45 years ago that all
    agents be polygraphed every 5 years, and those in
    counterintelligence, every 3 years. And they have followed that
    at the Central Intelligence Agency. But they have not followed
    it at the FBI, and only commenced it, according to your answer,
    in 1994. Is that right?
        Mr. Freeh. In 1994, we started to polygraph all new
    employees. Yes, sir.

                        law enforcement school in Mexico

        Senator Hollings. Then let me jump to the Mexico question,
    because I have been trying my best to get any kind of facet of
    a Marshall Plan started there.
        And you and I discussed at a previous hearing the idea of
    an FBI school down below the border. Have you made any progress
    on that?
        Mr. Freeh. We have made some progress. I have met
    personally with the foreign minister, Mr. Castaneda, Mr.
    Aguilar, the National Security Adviser, the new Attorney
    General of Mexico, as well as the head of the Federal Judicial
    Police. We are in discussions in conjunction with the State
    Department about exactly that establishment.
        They have made a request; the new government should be
    commended for making the request that we become directly and
    overtly involved in the training of the Federal Judicial
    Police, which the new government wants to model as a National
    Bureau of Criminal Investigations.
        We are very excited about this opportunity. I have
    discussed it with Secretary Powell, and it is something that I
    am sure is going to come before the committee at some point for
    a request for assistance.

                                   conclusion

        Senator Hollings. Well, I thank you, and I thank you for
    your service, Judge. Good luck to you.
        Mr. Freeh. Thank you, Mr. Hollings.
        Senator Gregg. Let me join Senator Hollings in those
    comments.
        We appreciate your service. The country has been well-
    served. And you are generous to have given this large chunk of
    your life to our nation, and we thank you for doing that.
        We look forward to continuing to work with you and wish you
    Godspeed as you move forward.
        Mr. Freeh. Thank you, Mr. Chairman, very much. I appreciate
    it.
        Senator Gregg. Thank you, Mr. Director.

                     Immigration and Naturalization Service

    STATEMENT OF KEVIN D. ROONEY, ACTING COMMISSIONER

                       opening remarks of chairman gregg

        Senator Gregg. We will now hear from the acting
    Commissioner and Administrator of DEA and INS, Mr. Marshall and
    Mr. Rooney.
        Well, we thank you, gentlemen, for waiting and being so
    patient. I recognize you have a busy day and appreciate you
    participating.
        We will open the hearing up to your statements, if you wish
    to make any.
        So we can start with you, Mr. Commissioner, and then we
    will go to the Administrator.

                opening statement of acting commissioner rooney

        Mr. Rooney. Well, thank you, Mr. Chairman. I appreciate the
    opportunity to appear here today to discuss the President's
    fiscal year 2002 budget request for the Immigration and
    Naturalization Service.
        In recent years, this subcommittee's strong support has
    allowed INS to make significant improvements in how we carry
    out our dual enforcement and service responsibilities.
        Our fiscal year 2002 budget request at $5.5 billion is 10
    percent higher than our current funding level and will enable
    the agency to build on a solid foundation and further
    strengthen the nation's immigration system.
        INS's aim has been to build a seamless web of enforcement,
    extending from our borders to the Nation's interior. The
    proposed budget continues support for the comprehensive
    strategies that we have been implementing in pursuit of this
    goal. The focus is on border control, which is the anchor for
    our entire enforcement web.

                            border control strategy

        Our border control strategy is designed to create and
    maintain borders that both facilitate the legal flow of people
    and products into our Nation, while preventing illegal
    immigration and the smuggling of drugs and other contraband.
        To move closer to our goal in fiscal year 2002, we are
    seeking 570 Border Patrol agents. These new agents, plus an
    additional 570 that the Administration has proposed for next
    year--fiscal year 2003--will complete the 5,000 agent increase
    authorized by Congress in 1996. We are also asking for $20
    million for intrusion detection technology, which has a force-
    multiplying effect on the border.
        We plan to deploy the bulk of these resources along the
    Southwest border, particularly in Arizona and eastern
    California, where we want to replicate the recent success we
    have had in San Diego and elsewhere.
        Enhanced enforcement between our ports-of-entry is not
    enough, however. INS must also continue to strengthen
    activities occurring in the ports, at the border, and in the
    Nation's interior.
        And this budget request will allow us to do that by
    providing $50 million for 417 new immigration inspectors. It
    also earmarks $26 million for improving various automated
    information systems, including the database that the inspectors
    use to prevent criminals, suspected terrorists, and other
    inadmissible individuals from entering the country.
        Border Patrol agents and immigration inspectors will be
    further aided by proposed improvements to INS's intelligence
    program. We have asked for 78 positions and $7 million to
    expand the intelligence program on our borders, where
    intelligence plays a critical role in preventing the entry of
    undocumented aliens, drug traffickers, and terrorists, as well
    as in detecting and dismantling smuggling rings.

                    effective detention and removal program

        Without an effective detention and removal program,
    however, detecting and apprehending deportable aliens becomes
    little more than a training exercise, lacking in credibility
    and producing few results. And that is why we are asking for an
    additional 158 positions and $82 million in fiscal year 2002
    for detention and removal.
        With these new resources, we will be able to use 1,600 more
    beds in State and local detention facilities, which are crucial
    for accommodating a daily average population now of more than
    19,000 detainees, which is triple the 1995 number.

                              immigration benefits

        As INS continues to strengthen enforcement in response to
    the unprecedented pressure that illegal immigration has created
    at our borders and in the Nation's interior, we must also
    handle the skyrocketing demand for immigration benefits.
        Based on receipts to date, we project that by the end of
    this fiscal year, we will receive some 9.5 million applications
    and petitions for benefits. That is 50 percent more than we
    received last year and 80 percent more than the year before
    that.
        The demand for services is being fueled by both changes in
    immigration law and record-level legal immigration. Preliminary
    figures indicate that we welcomed more newcomers in the last 10
    years than in any decade in U.S. history.
        INS is currently implementing the Legal Immigration Family
    Equity Act, the LIFE Act, which was signed into law in
    December. We estimate that the agency will receive nearly 4.5
    million LIFE Act related applications by the end of fiscal year
    2003.
        In fact, we are already feeling the impact of the law. It
    is the chief reason why we received more non-naturalization
    applications in March than in any other month in more than a
    decade.
        In recent years, INS has worked diligently to rebuild a
    service structure that was weak and woefully inadequate to
    handle the agency's workload. Reconstruction is far from
    complete, but I can assure you that considerable progress has
    been made.
        Last year, for example, we completed 24 percent more
    benefit applications than we did in 1999. As a more meaningful
    measure for those applicants who had languished in line, we
    completed last year 430,000 more applications than we received.
        The Administration has proposed establishing a universal
    62-month standard for processing all benefit applications and
    petitions within the next 5 years. To meet this goal, the
    Administration has pledged to support a $500 million initiative
    to fund new personnel and enhance technology and to make
    customer satisfaction a first priority. Our fiscal year 2002
    budget request includes the first $100 million installment of
    this 52-year plan.
        Mr. Chairman, from what little of the budget request that I
    have just highlighted, you can see that in both enforcement and
    in services INS faces enormous challenges in this fiscal year
    and fiscal year 2002.
        However, as I have seen since taking over as Acting
    Commissioner 7 weeks ago, I believe there are clear indications
    that the agency is moving in the right direction to start to
    meet those challenges, and I look forward to working with you
    to maintain this momentum.
        Thank you, Mr. Chairman. I look forward to any questions
    that you may have.
        Senator Gregg. Thank you, Commissioner.
        [The statement follows:]
                     Prepared Statement of Kevin D. Rooney
                                  introduction
        Thank you Mr. Chairman, Senator Hollings, and Members of the
    Subcommittee for the opportunity to appear before you today to discuss
    the President's fiscal year 2002 budget request for the Immigration and
    Naturalization Service (INS). This INS budget request builds upon the
    accomplishments that have been achieved with your strong support. The
    resources Congress has provided have enabled INS to meet new challenges
    and strengthen the Nation's immigration system. They have resulted in
    improvements in how we enforce immigration laws and how we deliver
    services to our customers.
        The President's fiscal year 2002 budget request for the Immigration
    and Naturalization Service totals $5.5 billion, a 10 percent increase
    over the fiscal year 2001 funding level. This budget includes $380
    million in enhancements to go with a base funding level of $5.1
    billion. The budget will add a total of 1,364 new staff positions,
    which will allow INS to grow to over 36,200 workyears by the end of
    fiscal year 2002.
        The INS budget for fiscal year 2002 continues to support the
    immigration goals and strategies that the agency has pursued over the
    past several years. The thrust of INS' fiscal year 2002 budget is to
    extend the ongoing initiatives aimed at controlling the Nation's
    borders and maintaining the physical integrity of those borders. INS
    intends to build on its successful multi-year strategy to: effectively
    regulate the border; deter and dismantle smuggling or trafficking of
    aliens and narcotics in the interior of the United States, as well as
    other immigration-related crime; identify and remove suspected
    terrorists; identify and remove incarcerated criminal aliens from the
    United States, and minimize recidivism; enhance services and reduce
    processing backlogs; and reduce immigration benefit fraud and other
    document abuse.
    Border Management
        The fiscal year 2002 budget includes an additional 570 Border
    Patrol Agents and $75 million to support the border control strategy.
    We would propose that these resources will be primarily directed to the
    Southwest border so as to increase the emphasis provided to the eastern
    California, Arizona and Texas borders. These new agents, plus 570 in
    fiscal year 2003, will complete the 5,000-agent increase authorized by
    the Congress.
        The fiscal year 2002 budget also requests $20 million so that
    deployment of intrusion detection technology, including high-resolution
    color and infrared cameras and state-of-the-art command centers, will
    continue. This technology acts as a ``force multiplier'' to supplement
    the new agents and provide continuous monitoring of the border from
    remote sites. This combination of intrusion detection technology and
    the increased number of Border Patrol Agents will permit INS to enforce
    the rule of law and enhance border management over larger portions of
    the U.S. border. This technology assists agents in determining the
    source of the ``hit,'' including the number of intruders, and if they
    are armed, thereby increasing agent safety. The Integrated Surveillance
    Intelligence System (ISIS) enhancement is an important part of the
    overall strategy for strengthening control of the border against
    illegal entry. ISIS will improve remote detection and tracking
    capabilities, resulting in increased deterrence of illegal border
    crossing and increased officer safety. Ultimately, it will provide the
    INS, in particular, the Border Patrol, with the capability to
    effectively monitor the integrity of the United States/Mexico and
    United States/Canada national boundaries for purposes of border
    management.
        The INS Intelligence program provides strategic and tactical
    intelligence support to INS offices enforcing the provisions of the
    Immigration and Nationality Act, and assists other federal agencies in
    addressing national security issues. Intelligence program activities
    contribute support to: preventing the entry of illegal aliens,
    terrorists and narcotics traffickers; identifying and dismantling alien
    smuggling operations; detecting fraudulent documents and false claims
    to U.S. citizenship; and detecting other individuals or organizations
    involved in the manufacture and sale of counterfeit documents, in
    application and benefit fraud schemes, and other related criminal
    activity. The fiscal year 2002 budget includes 78 positions and $7
    million to expand the intelligence program on the northern and southern
    borders of the United States.
    Air and Sea Ports-of-Entry
        INS must balance its limited resources between its goals of
    detecting those who should not be allowed to enter the United States
    and managing legal travel across the border. The fiscal year 2002
    budget request includes $50 million for 417 new Immigration Inspectors
    to staff newly activated air and sea port terminals, high-growth
    understaffed gateway ports, and joint INS/U.S. Customs passenger
    analysis units. The request also includes 122 inspection assistants and
    clerks, along with detention and removals resources to support the
    significant increases in workloads at high-growth air and sea ports-of-
    entry. The budget provides for an expansion of the Carrier Consultant
    Program to enhance airline carrier training and for the increased
    workload attributable to the 2002 Winter Olympics.
        With these resources, the Service will strive to process 77 percent
    of all commercial flights within 30 minutes and make strides in
    streamlining and automating manual processes, improving data integrity,
    and supporting enforcement requirements. To finance these initiatives,
    the fiscal year 2002 budget includes language that will increase the
    current airport inspections fee by $1 from $6 to $7 for arriving
    international air passengers. It would also lift the cruise ship fee
    exemption, instituting a $3 fee for those passengers currently exempt.
    The increase is to provide resources to cover more of the true costs of
    operating the program.
        In addition, the fiscal year 2002 budget contains $26 million to
    expand significant resources for information technology initiatives.
    Resources are provided to update the National Automated Inspections
    Lookout System (NAILS) a centralized lookout database which is a
    compilation of information supplied by automated systems within INS and
    other federal and local law enforcement agencies. It is a critical
    system that contains data on individuals who are inadmissible,
    including criminals and suspected terrorists. The request includes
    resources to study technology for automated airport inspection
    alternatives. This budget will provide resources to purchase Live Scan
    Devices that will send electronic fingerprint submissions to the FBI,
    develop the Vessel Inspection Processing System (VIPS), and purchase
    portable workstations to access NAILS at the seaports. The fiscal year
    2002 budget will also provide the initial investments necessary to
    develop an automated entry/exit system as required in the INS Data
    Management Improvement Act of 2000.
    Detention and Removal
        In addition to the expansion of INS' more visible enforcement
    functions, additional funding will strengthen the detention and removal
    process. It is critical that INS continue to have resources to
    efficiently house and repatriate illegal aliens encountered both at the
    border and through enforcement of immigration laws beyond the immediate
    border area. To that end, 173 positions and $89 million are requested
    in fiscal year 2002 for detention and removal initiatives in the areas
    of expanded national transportation, improved health services for
    detained aliens, increased detention bed space, and improved
    coordination with U.S. Attorneys. Included in the $89 million is a
    projected $40 million in Breached Bond/Detention Fund revenue which is
    anticipated as a result of the reauthorization of adjustment of status
    provisions of section 245(i) of the Immigration and Nationality Act
    (INA), and $7 million for detention beds to support increases in
    workloads at high-growth air and sea ports of entry.
    Consolidated Detention Bed Space
        To continue to meet the mandatory detention requirements of the
    Illegal Immigration and Immigrant Responsibility Act of 1996, the
    budget request includes $69 million for 131 positions (68 Detention
    Enforcement Officers, 33 Deportation Officers, and 30 support
    positions) and an additional 1,607 average daily state and local
    detention bed spaces. This initiative includes resources to detain,
    transport and remove aliens.
    National Transportation System
        The INS uses the Justice Prisoner and Alien Transportation System
    (JPATS), created in 1995 by INS and the U.S. Marshals Service, to
    transport large numbers of detained aliens each year, transferring them
    to detention facilities or repatriating them. The budget includes an
    increase of $9 million to fund the costs associated with the INS' share
    of JPATS. This increase, when combined with current funding, will fund
    additional air movements to transfer or repatriate detainees.
    Public Health
        The budget includes funding of $9 million to support the increased
    cost of providing health care for detainees. The INS is committed to
    ensuring that its facilities are safe and humane, and that adequate
    medical care is provided to aliens in its custody.
    Coordination with U.S. Attorneys
        The budget includes 42 positions (28 attorneys and 14 support
    personnel) to enable the INS to better fulfill its role of providing
    agency counsel support to the U.S. Attorneys Offices and the Office of
    Immigration Litigation in immigration-related matters arising in the
    Federal courts. This critical role involves such efforts as preparing
    litigation reports when lawsuits arise, and coordinating agency
    witnesses and evidence. These litigation efforts will facilitate the
    removal of detained aliens, a substantial number of whom are convicted
    felons. It will also ensure that aliens not eligible for immigration
    benefits are appropriately identified and denied any benefit.
    Immigration Services
        The INS is proud of its accomplishment of processing over one
    million naturalization applications during fiscal year 2000, and plans
    to continue the quality and timely processing of applications. The
    President's fiscal year 2002 budget includes $100 million to implement
    the first installment of the President's five-year, $500 million
    initiative to process all applications within six months and provide
    quality service to all legal immigrants, citizens, businesses and other
    INS customers. These resources will be used for increased personnel,
    enhanced information technology and other resources to make customer
    satisfaction a priority.
    Infrastructure Improvements
        The INS continues to face a number of challenges in maintaining its
    infrastructure during a period of rapid growth. New and expanded
    facilities are required to support a work force of over 32,000. The
    Border Patrol's infrastructure needs are most serious and have been and
    continue to be given priority attention. Since the authorization of the
    INS Construction Account in fiscal year 1995, the Congress has provided
    much-needed resources to allow INS to replace, expand and renovate
    facilities and to enhance border infrastructure. The INS budget request
    for fiscal year 2002 continues support for critical infrastructure
    requirements. It includes $75 million for construction projects. This
    total includes $69 million for Border Patrol and detention construction
    projects, and $6 million for additional work on the San Diego Border
    Barrier System and for the enhancement of border infrastructure through
    the critical direct support of Joint Task Force Six (JTF-6) for
    projects such as fences, roads, and border barriers.
    Significant Accomplishments
        There are several areas of INS operations that should be
    highlighted due to the accomplishments that have been achieved.
    Border Patrol Recruiting and Hiring
        The President's blueprint states his intention to fund the INS to
    hire the remaining 1,140 Border Patrol agents needed to complete hiring
    of the 5,000 agents authorized by the Congress in the Illegal
    Immigration Reform and Immigrant Responsibility Act (IIRIRA) of 1996.
    His plan is that the INS will be funded to hire 570 agents in each of
    fiscal year 2002 and fiscal year 2003 to achieve the hiring goal. With
    these 1,140 additional agents, the total increase of 5,000 Border
    Patrol Agents will be achieved, and the authorized strength of the
    Border Patrol will be about 11,000.
        In fiscal year 2000, INS experienced record increases in the number
    of Border Patrol applicants and hires as a result of: (a) a more
    focused, local recruitment process, (b) the training of 300 Border
    Patrol Agents as recruiters, (c) intensified advertising, and (d)
    offering a $2,000 recruitment signing bonus. The enhanced recruitment
    program was supported in part by $1.5 million included in the fiscal
    year 2000 appropriation for these efforts. The Border Patrol has been
    able to attract sufficient numbers of applicants to meet hiring goals
    through fiscal year 2001. The INS is currently recruiting to ensure
    maintenance of a qualified pool of applicants for fiscal year 2002 and
    is no longer experiencing Border Patrol hiring problems and is
    confident that hiring commitments will be met in fiscal year 2002 and
    fiscal year 2003.
        In fiscal year 2000, the INS implemented ``compressed testing'' at
    10 Sectors. This allowed applicants to take the written test and
    receive results immediately upon completion of the exam. If the
    applicant passed the written exam, he/she could schedule the oral board
    examination in 2 weeks. This process is 5 or more weeks shorter than
    the traditional testing process and resulted in a 44 percent increase
    in applicants actually showing up to take the test.
        In fiscal year 2000, the Border Patrol trained 300 agent recruiters
    who participated in over 1,400 recruiting events ranging from campus
    and military job fairs, to open houses, to booths at local malls.
    Border Patrol recruiters were encouraged to establish personal contact
    and feedback with all interested applicants with positive results. We
    significantly increased advertising and recruitment incentives.
        As a result, in fiscal year 2000, the INS achieved a record number
    of applicants (an 80 percent increase over fiscal year 1999) due to
    aggressive recruitment and hiring initiatives to address Border Patrol
    Agent hiring shortfalls. The increase in recruitment provided the
    applicant pool with sufficient candidates for an associated increase in
    hiring. In fiscal year 2000, the INS hired 52 percent more agents than
    in fiscal year 1999.
        During this fiscal year, INS has hired 900 new Border Patrol agents
    and will hire another 700 by the end of the year. Our training classes
    are already full through July.
    Anti-Smuggling and Anti-Fraud Activities
        The INS has a number of significant accomplishments to report in
    anti-smuggling and anti-fraud operations. During fiscal year 2000, INS
    disrupted alien smuggling organizations at source countries, the
    borders and the interior of the United States. The agency used
    traditional and non-traditional investigative techniques, cooperation
    and coordination with the FBI, and broadened use of statutory
    authorities. The INS presented 7 major cases and 2,520 smuggling
    principals for prosecution. For example, the ``Operation Knight
    Riders'' investigation involved a large-scale alien smuggling
    organization that specialized in moving large numbers of undocumented
    aliens from Central and South America and the Middle East into the
    United States. The successful completion of this case resulted in 9
    criminal arrests and the closure of a major smuggling pipeline. In
    ``Operation Telecom'' INS investigated and shut down a sophisticated
    alien smuggling organization that engaged in recruiting and arranging
    for the smuggling of Chinese nationals from the People's Republic of
    China. This investigation also involved a law firm that assisted the
    smugglers by arranging bonds so aliens could be released and returned
    to the smugglers. The firm also filed fraudulent political asylum
    claims on behalf of the aliens to ensure that they would remain in the
    United States.
    Border Management and Control
        The INS' border management and control efforts have been producing
    significant impacts on the border. In fiscal year 2000, INS carried out
    immigration inspections for nearly 438 million travelers at the land
    borders and nearly 92 million travelers at airports and seaports. In
    fiscal year 2001, these inspections are projected to reach 450 million
    at the land border and 98 million at airports and seaports, with
    continued growth in fiscal year 2002. The INS has set fiscal year 2001
    performance targets of 80 percent of land border inspections in 20
    minutes or less, and 72 percent of air flights cleared within 30
    minutes. The INS will also continue the use of automated systems such
    as dedicated commuter lanes to facilitate the flow of inspection
    traffic.
        During fiscal year 2001, INS is continuing to implement the Border
    Patrol's National Strategic Plan, a systematic four-phase approach to
    strengthen control of the border with a national focus of ``prevention
    through deterrence.'' It is a means to restrict illegal traffic and
    encourage legal entry. The plan has been implemented in San Diego, El
    Paso, Brownsville and Nogales and it is getting results. For example,
    in San Diego apprehensions are at a 25-year low. Apprehensions at other
    points on the border have also declined. With the deployment of
    additional personnel and equipment this year, we expect this trend to
    continue. Changes in apprehension trends will be monitored carefully.
    Interior Enforcement/Quick Response Teams
        Considerable progress has been made in establishing and staffing
    the Quick Response Teams (QRTs). In the fiscal year 1999 INS
    appropriation, Congress provided for the creation of QRTs and directed
    INS to establish 45 teams with 200 positions. These teams work directly
    with State and local law enforcement officers to take into custody and
    remove illegal aliens. Of the 200 QRT officers that have been selected,
    193 have entered on duty at their assigned locations. The remaining
    officers are expected to enter on duty before the end of fiscal year
    2001.
        Based upon costs incurred during deployment of QRTs to date, INS
    estimates that it costs approximately $1.2 million to make each
    additional QRT site fully operational. Operating costs primarily
    include an average of estimated personnel-related costs for the
    combination of INS special agents, detention officers, and deportation
    officers, any projected acquisition and build-out costs of any new
    offices, standard alterations (as required) to existing facilities, and
    funding to purchase and retrofit the additional vehicles needed. Hence,
    the funding provided in the fiscal year 1999 appropriations was not
    fully sufficient to deploy the 45 QRTs, and base funds had to be
    identified to fund the shortfall. The proposed use of the QRT funds
    provided in fiscal year 2001 is under development.
        Much has been accomplished with the QRTs. During the first quarter
    in fiscal year 2001, the teams received 2,532 requests for assistance
    from State and local law enforcement agencies. This figure reflects the
    largest number of requests received by the QRTs in any given quarter to
    date. Of the 2,532 requests, QRTs were able to respond to 92 percent
    (2,317). The response time for 98 percent of all requests was less than
    three hours. In addition, QRT officers made 2,246 administrative
    arrests. Of these arrests, 1,214 were voluntarily returned to their
    respective countries of citizenship. Special Agents deployed at QRT
    sites presented 171 individuals for criminal prosecution related to
    alien smuggling, document fraud, and illegal entry.
    Detention and Removal
        Since the early 1990's, the average daily population of INS
    detainees has grown from less than 6,000 to over 19,000. This rate of
    growth was the result of INS' expanded enforcement capability and
    changes in detention requirements contained in the IIRIRA of 1996. That
    law requires the agency to detain without bond virtually any alien
    subject to removal on the basis of a criminal conviction. The INS is
    also required to detain aliens who have been ordered removed from the
    United States for up to 90 days or until they are removed, regardless
    of the basis for the order and the prospects that their home countries
    will accept their return. As a result, annual removals in fiscal year
    2000 were over 180,000. Over 64,000 of these were criminal alien
    removals. In fiscal year 2001, we project that 67,000 criminal aliens
    will be removed from the country.
        In dealing with the growth in the detention population, INS has
    issued detailed standards aimed at ensuring consistent treatment and
    care for all detainees. The standards apply to INS' 9 Service
    Processing Centers as well as contract facilities and state and local
    facilities under intergovernmental service agreements. In addition to
    standards for safe, secure and humane confinement, they provide for
    consistent and expanded access to legal representation, telephones and
    family visits.
    Immigration Services
        Due to an intense, two-year Naturalization Backlog Reduction
    Initiative, the INS has made tremendous progress in increasing its
    immigration services' productivity and customer service. In fiscal year
    1999, the INS met its first stage goal of completing 1.2 million
    naturalization applications. In fiscal year 2000, INS again met its
    naturalization goal by completing approximately 1.3 million
    applications while achieving a processing time goal of six to nine
    months nationwide. In fiscal year 2000, INS also completed 564,000
    adjustment of status applications, more than in any other year in the
    INS' history, and outperformed its national processing time goal. The
    Service also streamlined the ``Green Card'' renewal process, decreasing
    the processing time significantly from between 12 and 24 months to 90
    days. In fiscal year 2000, the INS also reduced the processing time for
    employment petitions from 18 months to 90 days. By transmitting
    fingerprints electronically to the FBI, the INS decreased the average
    processing time for background investigation checks from 21 days to one
    day. The INS enhanced its customer service quality and accessibility by
    expanding the National Customer Service Center's live, toll-free (1-800
    telephone) assistance area across the U.S. mainland, Puerto Rico, the
    U.S. Virgin Islands, and Guam. In fiscal year 2001, the INS continues
    working diligently to meet its goal of completing 800,000
    naturalization and 800,000 adjustment of status applications.
        The INS faces significant challenges in delivering immigration
    services in the years ahead: (1) eliminating backlogs in all
    immigration benefit applications; (2) managing and responding to new
    and changing workload; (3) ensuring process integrity; and (4)
    positioning itself for the future, including making needed investments
    in information technology. Over the last several years, the INS has
    seen a dramatic rise in the number of applications and petitions
    received. The LIFE Act amendments alone will add an additional caseload
    of 2.3 million applications and petitions in fiscal year 2001 and 1.2
    million applications and petitions in fiscal year 2002 to the current
    6.9 million applications received annually, a 26 percent increase over
    a two-year period. Because this additional workload will strain the
    existing infrastructure, the INS is exploring new ways of doing
    business to manage the new workload effectively while continuing to
    tackle the backlogged caseload aggressively. Premium Processing Service
    and electronic filing are examples of these new ways of doing business.
    Besides increased productivity, the INS continues working towards
    achieving process integrity through its anti-fraud and quality control
    efforts. Most importantly, the INS strives for excellence in customer
    service through process reengineering, effective and new use of
    technology, and greater accessibility to information and services.
                                   conclusion
        The fiscal year 2002 request will provide INS with resources needed
    to carry out an effective immigration strategy. As you know, this
    Administration is committed to restructuring and splitting the INS into
    two agencies with separate chains of command that report to one policy
    official within the Department of Justice. I look forward to working
    with the Subcommittee. With your continued support, we can add to the
    improvements that have already been made and address problem areas and
    ensure the agency's integrity.
        This concludes my formal statement on the fiscal year 2002 budget
    request for INS. I would be happy to answer any questions which you,
    Mr. Chairman, and Members of the Subcommittee may have.
                                     ______

                     Biographical Sketch of Kevin D. Rooney
        Kevin D. Rooney was appointed Acting Commissioner of the
    Immigration and Naturalization Service, effective March 26, 2001. Prior
    to assuming this position, he served as Director of the Executive
    Office for Immigration Review (EOIR) since 1999. EOIR oversees the
    immigration court system, including the Board of Immigration Appeals
    and 52 immigration courts nationwide. Mr. Rooney previously served as
    Deputy Director of EOIR from 1995 to 1997.
        As the Assistant Attorney General for Administration from 1977 to
    1984, Mr. Rooney served as the Department of Justice's senior career
    official and chief management and financial officer under three
    Attorney's General during the Carter and Reagan Administrations. He was
    Assistant Director of the Bureau of Prisons from 1997 to 1999, and
    practiced law in Washington, D.C. from 1984 to 1995.
        Mr. Rooney is a native of Palmer, Massachusetts and a graduate of
    St. Mary's Seminary and University and George Washington University
    School of Law.

                        Drug Enforcement Administration

    STATEMENT OF DONNIE R. MARSHALL, ADMINISTRATOR
        Senator Gregg. Mr. Marshall.
        Mr. Marshall. Mr. Chairman, good morning, and thank you. I
    appreciate the opportunity to be here this morning, and I want
    to first take this opportunity to express my gratitude to this
    subcommittee and the entire committee for your ongoing support
    of the 9,000 very dedicated and courageous and talented men and
    women of DEA.
        As the world's premier drug law enforcement agency, DEA's
    mission, quite simply, is to identify and dismantle the world's
    most sophisticated drug trafficking organizations.
        Throughout the United States and, in fact, the world, DEA
    is at the cutting edge of drug law enforcement. We continuously
    adapt our methods to the quickly changing dynamics of the
    criminal enterprises and the drug trade.
        DEA's efforts, Mr. Chairman, have had a major impact on
    global drug trafficking. The demise of the Medellin and Cali
    cartels in Colombia are due, in large part, to DEA's aggressive
    investigations and our long-standing domestic and international
    cooperative efforts.
        Our successes against Southeast Asia drug trafficking
    organizations have really all but eliminated Southeast Asia
    heroin from the United States market.
        And we have had an impact on Mexico-based methamphetamine
    organizations, which has resulted in a marked decrease in the
    purity of methamphetamine coming out of laboratories operated
    by those criminal groups.
        But despite that good news, we have many challenges ahead.
    We see in the United States now that Colombian-based
    traffickers dominate the heroin market. We see that the Mexican
    organizations have really evolved into what I think is the most
    significant challenge that faces law enforcement in the United
    States today and, perhaps, in our history.
        Along with the traditional drugs of cocaine, heroin,
    methamphetamine, marijuana, we see new drugs coming on the
    market, and they continue to emerge. Two of the most recent
    examples of those are the popular club drug, so-called Ecstasy,
    and the very newest threat of OxyContin.
        Now, if we are to successfully address each of these new
    challenges, we have to rely on the resourcefulness, dedication,
    and integrity of our agents, our cooperation with other law
    enforcement agencies, and the consistent support that we have
    received from this committee.
        Now, in that context of, I hope, continued success and
    continued addressing of these new and emerging threats, let me
    briefly summarize our budget request that is before you today.

                               dea budget request

        In our salaries and expenses appropriation, we are
    requesting a total of $1.5 billion and a little over 7,600
    positions. That represents an increase of about $120 million
    over the 2001 enacted levels.
        Our request contains $62.5 million needed to maintain
    current levels of operations and $58.2 million and 134
    positions for three basic program initiatives, and I will very
    briefly outline those three initiatives.

                   special operations division budget request

        First, we are seeking $15.1 million and 62 positions for
    the Special Operations Division and Communications Intercept
    Initiative. The Special Operations Division, as you may know,
    is designed to coordinate multiagency, multijurisdictional,
    even multinational investigations, which we aim at the command
    and control structures of the criminal drug organizations
    operating both domestically and abroad.
        Senator, the Special Operations Division has really, over
    the last several years, become our very most effective tool
    against the command and control structure of those major drug
    trafficking organizations.
        Now, the resources we are asking for will be used to
    enhance staffing levels at our Special Operations Division
    investigative units that focus on the Southwest border, Latin
    America, the Caribbean, Europe, and Asia. And it also augments
    our funding base for contract linguists, communications
    intercept equipment, and technical support personnel.

                            firebird budget request

        The second initiative is an enhancement of $30 million and
    three positions for our FIREBIRD network. The FIREBIRD network
    is the primary office automation infrastructure that serves, as
    the communications backbone for DEA, for our intelligence
    network, and for many other mission-critical databases and
    operational systems.
        We are requesting funding to complete the deployment of the
    FIREBIRD system, to provide network security, and support
    technology renewal so that the system can be updated and so
    that we can replace outdated equipment and software on a
    regular schedule.

                laboratory operations initiative budget request

        The third and final initiative is for $13.1 million and 69
    positions for our Laboratory Operations Initiative, which will
    help us meet mission-critical requirements within that
    laboratory services program.
        DEA's forensic chemists provide a variety of essential
    services, including drug and evidence analysis, on-site
    assistance for clandestine laboratory seizures and crime scene
    investigations, and vital courtroom testimony to support
    prosecution efforts, which is the ultimate goal and product of
    all the work that we do.
        Now, these resources, I think, will enable DEA to more
    effectively meet our mission requirements of both our special
    agent workforce and to better support the prosecution of drug
    offenders through timely analysis of evidence.

                               prepared statement

        Mr. Chairman, that concludes my summary. I do have a
    written statement that I would like to enter for the record,
    and I will be happy to answer any questions that you may have.
        [The statement follows:]
                    Prepared Statement of Donnie R. Marshall
        Mr. Chairman and Members of the Subcommittee, I appreciate the
    opportunity to appear before you today to discuss the fiscal year 2002
    budget request of the Drug Enforcement Administration (DEA).
        Before I begin my testimony today, I would like to take this
    opportunity to express my sincere gratitude for the subcommittee's
    ongoing support. Without your support, DEA could not continue to safely
    and effectively meet the growing challenges posed by increasingly
    sophisticated and dangerous international drug trafficking
    organizations operating throughout the global community. The
    subcommittee's support has helped us to send a message to these
    traffickers that their assault on the citizens of this nation will not
    be taken lightly, and that we will continue to fight to ensure that our
    streets remain safe for generations to come.
        The mission of the DEA is to enforce the Controlled Substances laws
    and regulations of the United States and to bring to the criminal and
    civil justice system of the United States, or any other competent
    jurisdiction, those organizations involved in the growing,
    manufacturing and/or distribution of controlled substances destined for
    illicit traffic in the United States. The DEA also recommends and
    supports non-enforcement programs aimed at reducing the availability of
    illicit controlled substances on both domestic and international
    markets. To accomplish this mission, DEA works with international,
    federal, and state and local law enforcement partners to target and
    immobilize the organizations of major drug traffickers operating at all
    levels of the drug trade.
        I have long said this fight cannot be won through law enforcement
    alone. There must be a ``holistic'' approach to a global problem. DEA
    has in place a five-year strategic plan, which addresses the problems
    posed by illicit drug availability and abuse and provides for a
    comprehensive balanced approach. There is no doubt that interdiction
    and enforcement, coupled with education, prevention and treatment, are
    the essential elements for reducing the supply and demand of illicit
    drugs in this country.
        DEA, in its capacity as the world's leading drug enforcement agency
    and the only single-mission federal agency dedicated to drug law
    enforcement, has developed the unique ability to direct resources and
    manpower to identify, target, investigate and dismantle drug
    organizations headquartered overseas and within the United States.
    DEA's strategy to successfully accomplish these goals is
    straightforward, requiring that the agency's resources and manpower be
    focused on all three levels of the drug trade: the international,
    national/regional, and local levels. Each of these categories
    represents a critical aspect of the drug continuum, which affects
    communities across the nation.
        The 9,000 dedicated men and women of the DEA are committed to
    improving the quality of life of the citizens of the United States. The
    agency directs and supports investigations against the highest levels
    of the international drug trade, their surrogates operating within the
    United States and those traffickers whose violence and criminal
    activities threaten towns and cities across the country. These
    investigations are intelligence-driven and frequently involve the
    cooperative efforts of numerous other law enforcement organizations.
        DEA's strategy to reduce drug trafficking at all levels of
    operation is flexible and reflects the constantly changing nature of
    the drug trade. In concert with the Department of Justice, our sister
    law enforcement agencies, and the Office of National Drug Control
    Policy (ONDCP), DEA has crafted an innovative and effective program to
    keep pace with developments and shifts in the drug trafficking spectrum
    and bring both national and international drug traffickers to justice.
                        fiscal year 2002 budget request
        Consistent with this strategy, DEA is requesting additional
    resources to implement these plans. For fiscal year 2002, DEA is
    requesting a total of $1.6 billion, 8,314 positions, and 8,171 FTE, of
    which $1.5 billion, 7,654 positions and 7,515 FTE are funded by our
    Salaries and Expenses (S&E) Appropriation, and the remainder is funded
    by the Diversion Control Fee Account. For the S&E Appropriation, this
    represents an increase of $120.6 million and 134 positions over the
    fiscal year 2001 enacted levels. The increase consists of $62.5 million
    needed to maintain our current level of operations and $58.2 million
    and 134 positions (including 13 Special Agents) for three program
    initiatives: a Special Operations Division (SOD) and Communications
    Intercept Initiative, a FIREBIRD Initiative, and a Laboratory
    Operations Initiative. I will briefly discuss each in turn.
        First, DEA is seeking $15.1 million and 62 positions (including 13
    Special Agents) under the Special Operations Division and
    Communications Intercept Initiative to provide critical enhancements to
    its SOD and Investigative Technology programs. SOD is a comprehensive
    enforcement operation designed specifically to coordinate multi-agency,
    multi-jurisdictional and multi-national Title III investigations
    against the command and control elements of major drug trafficking
    organizations operating domestically and abroad. These resources will
    be used to enhance staffing levels in key investigative units within
    the SOD, to include support for drug enforcement investigations
    associated with the Southwest Border, Latin America, the Caribbean,
    Europe, and Asia. This request also augments DEA's funding base for
    contract linguists, and enhances DEA's investigative technology
    programs through new resources for equipment, technical support
    personnel, and training.
        Second, under our FIREBIRD Initiative, DEA requests an enhancement
    of $30 million and 3 positions for the global FIREBIRD network.
    FIREBIRD is DEA's primary office automation infrastructure. It provides
    essential computer tools for agents and support staff, including E-
    mail, uniform word processing, and many other forms of office
    automation software. FIREBIRD also serves as the communications
    ``backbone'' for DEA's MERLIN intelligence network, and serves as the
    platform for numerous other mission critical databases and operational
    systems. DEA is requesting funding to complete deployment of the
    system, provide vital network security, and support technology renewal
    of the system. The technology renewal resources will allow DEA to
    replace outdated technology and adopt a reasonable replacement cycle
    for FIREBIRD equipment.
        Third and finally, DEA requests $13.1 million and 69 positions
    (including 46 chemists) for our Laboratory Operations Initiative to
    meet mission-critical requirements within our laboratory services
    program. DEA's forensic chemists provide a variety of essential
    services, including drug and evidence analysis, on-site assistance for
    clandestine laboratory seizures and crime scene investigations, and
    vital courtroom testimony to support prosecution efforts. Likewise, the
    recent success of DEA's Operation Breakthrough program in providing the
    U.S. Government with new scientific data on coca cultivation and
    cocaine production in Colombia has demonstrated the crucial role played
    by DEA forensic chemists and intelligence analysts in supporting the
    critical intelligence needs of senior U.S. policy makers and the
    counterdrug intelligence community. We must be able to enhance our
    capability to carry out this type of strategic analysis and reporting.
    The requested funds and staffing are needed to address a growing
    backlog of exhibits and establish a laboratory equipment base that will
    better support program operations. Collectively, these resources will
    enable DEA to more effectively meet the mission requirements of its
    Special Agent workforce and better support the prosecution of drug
    offenders through timely analysis of evidence.
          the challenge: international drug trafficking organizations
        DEA targets, investigates, and dismantles the most powerful drug
    syndicates operating around the world which are responsible for
    supplying drugs to American communities. The most significant drug
    syndicates operating today are far more powerful and violent than any
    of the other organized criminal groups that we have experienced in the
    history of American law enforcement. Unlike traditional organized
    crime, these new criminals operate on a global scale with transnational
    networks to conduct illicit enterprises simultaneously in many
    different countries. DEA has grown in sophistication and effectiveness
    to meet the challenge posed by international drug trafficking in the
    new century.
        The main challenge DEA faced during the late 1980's was posed by
    the major drug traffickers from Medellin, Colombia. These drug lords
    were investigated, arrested and prosecuted by the Colombian National
    Police (CNP), the DEA, and U.S. Federal prosecutors, beginning with the
    landmark return of Carlos Lehder to face drug charges in the United
    States, and ending with the death of Pablo Escobar in a shoot-out with
    the CNP. During this same time frame, narcotics investigations by the
    DEA and other Federal, state and local entities created a choke point
    in South Florida and the Caribbean, through which most of the illicit
    drugs arriving in our country were being transported. These enforcement
    strategies led to the demise of the Medellin Cartel.
        As the Medellin traffickers disintegrated, the Cali traffickers
    quietly coalesced and assumed power equal to that of their
    predecessors. Due to law enforcement's response to the trafficking in
    the Caribbean, the Cali traffickers would later form an alliance with
    Mexican trafficking groups in order to stage and transport drugs across
    the Southwest Border. The drug traffickers from Cali were far more
    sophisticated than the Medellin group and eventually became deeply
    involved in all aspects of the cocaine trade, including production,
    transportation, wholesale distribution and money laundering. Whereas
    the Medellin traffickers seemed to revel in the terror and violence
    that became their trademark--and ultimately contributed to their
    downfall--the Cali traffickers attempted to avoid indiscriminate
    violence and sought to build their image as legitimate businessmen. The
    Cali leaders--the Rodriguez-Orejuela brothers, Jose Santacruz Londono,
    and Helmer ``Pacho'' Herrera-Buitrago--amassed fortunes and ran their
    multi-billion dollar cocaine businesses from high-rises and ranches in
    Colombia. Miguel Rodriguez-Orejuela and his associates comprised what
    was, until then, the most powerful international organized crime group
    in history.
        During 1995 and 1996, intense law enforcement pressure was focused
    on the Cali leadership by the brave men and women of the Colombian
    National Police. As a result, all of the top trafficking leaders from
    Cali were either in jail or killed. During that time frame, U.S. law
    enforcement agencies were effectively attacking Colombian cells
    operating within the United States. With the Cali leaders' imprisonment
    in Colombia and the successful attacks by law enforcement on their U.S.
    cells, traffickers from Mexico took on greater prominence. A growing
    alliance between the Colombian traffickers and the organizations from
    Mexico worked to benefit both sides.
        Traffickers from Mexico had long been involved in smuggling
    marijuana, heroin, and cocaine across the United States/Mexico border,
    using entrenched distribution routes to deliver drugs throughout the
    United States. The emergence of the Mexico-based organizations as major
    methamphetamine producers and traffickers also contributed to making
    them a major force in international drug trafficking. The Mexican
    traffickers, who were previously paid in cash by the Colombian
    traffickers for their services, began to routinely receive up to one-
    half of a shipment of cocaine as their payment. This led to Mexican
    traffickers having access to multi-ton quantities of cocaine and
    allowed them to expand their markets and influence in the United
    States, thereby making them formidable cocaine traffickers in their own
    right.
        The United States/Mexico border is now the primary point of entry
    for cocaine shipments being smuggled into the United States. According
    to a recent assessment, more than half of the cocaine smuggled into the
    United States crosses the Southwest Border. Today, traffickers
    operating from Colombia continue to control wholesale level cocaine
    distribution throughout the heavily populated northeastern United
    States and along the eastern seaboard in cities such as Boston, Miami,
    Newark, New York City, and Philadelphia. Traffickers operating from
    Mexico, however, control wholesale cocaine distribution throughout the
    western and Midwestern United States. The distribution of multi-ton
    quantities of cocaine once dominated by the Colombia-based drug groups
    is now controlled by Mexico-based trafficking groups in cities such as
    Chicago, Dallas, Denver, Houston, Los Angeles, Phoenix, San Diego, San
    Francisco, and Seattle.
        Members of international crime groups today pose a much greater
    threat than did their Medellin and Cali predecessors. They have at
    their disposal the most sophisticated communications technology,
    including faxes, the Internet, and cell phones. Additionally, they have
    in their arsenal radar-equipped aircraft, weapons and an army of
    workers who oversee the drug business from its raw beginnings in South
    American jungles to the urban areas and core city locations within the
    United States. All of this modern technology and these vast resources
    enable the leaders of international criminal groups to build
    organizations which, together with their surrogates operating within
    the United States, reach into the heartland of America. The leaders of
    these crime groups work through their organizations to transport drugs
    into the United States, and franchise others to distribute drugs,
    thereby allowing them to remain beyond the reach of American justice.
    Those involved in drug trafficking often generate such tremendous
    profits that they are able to corrupt law enforcement, military and
    political officials in order to create a safe haven for themselves.
        Successes against the Medellin and Cali drug lords accelerated the
    decentralization of the international cocaine trade. In this new
    century, we are seeing ``second generation'' traffickers emerge as
    major players in the Colombian cocaine trade. They tend to be less
    willing to directly challenge government authority and are much more
    sophisticated in their methods of operation. They extensively use
    wireless communication devices, which they change with great frequency.
    Other emerging characteristics are the use of computerized
    communications, elaborate concealment of clandestine cargo, and
    avoidance of direct involvement in retail distribution or even direct
    distribution to the U.S. market. The successful identification,
    investigation, and prosecution of these violators has become an even
    greater challenge to law enforcement both in the United States and
    Colombia.
                           the response: today's dea
        DEA is continuing to identify and build cases against the leaders
    of the new criminal groups from Colombia. As the criminals have become
    more sophisticated, we have built what is in many ways a new DEA, far
    more sophisticated than that which was created in the 1970s.
        As an organization, DEA has grown and changed tremendously over the
    years. From 1,446 agents and 1,422 support personnel in 1973, we have
    grown to 3,772 agents and 4,340 support staff at the end of 2000. From
    our first budget of $74 million in 1973, DEA's budget authority has
    grown to $1.44 billion for the current year.
        Domestically, we now operate through 21 Field Divisions, in
    addition to the Special Operations Division at DEA Headquarters, with
    offices in every State. Also within the United States, we work through
    the Organized Crime Drug Enforcement Task Forces (OCDETF) program. This
    program was initiated in 1982 to combine federal, state, and local law
    enforcement efforts into a comprehensive attack against organized crime
    and drug traffickers. DEA continues to be the leading initiator of
    OCDETF cases.
        Overseas, the DEA now maintains 78 offices in 57 countries. These
    offices support DEA domestic investigations through foreign liaison,
    training of host country officials, bilateral investigations, and
    intelligence gathering. Through the International Visitor Program, DEA
    provides foreign officials and U.S. diplomats with briefs on drug
    trafficking trends and national and international counter narcotics
    activities.
        Electronic surveillance is critical to our success in combating the
    drug problem in the United States. In fact, the vast majority of court
    authorized electronic surveillance actions are directly tied to
    enforcement of the controlled substances laws and regulations of the
    United States. Without this essential tool, we in drug law enforcement
    would be unable to prevent, investigate, and solve many of the crimes
    associated with the growing, manufacture, or distribution of illegal
    drugs. In order to meet the challenges presented by these sophisticated
    drug trafficking organizations, it is necessary for us to attack the
    command and control mechanisms of these organizations. Our center for
    targeting command and control is the Special Operations Division (SOD),
    a combined DEA, U.S. Customs, FBI, IRS/Criminal Investigations, and
    DOJ/Criminal Division effort that supports ongoing investigations by
    producing detailed and comprehensive analyses of data revealing the
    activities and organizational structures of major drug trafficking and
    drug-related money laundering organizations and identifying
    relationships among traffickers and their related enterprises.
        Today's international drug trafficking organizations are the
    wealthiest, most powerful, and most ruthless organized crime entities
    we have ever faced. We know from our investigations that they utilize
    their virtually unlimited wealth to purchase the most sophisticated
    electronic equipment available on the market to facilitate their
    illegal activities. The Special Operations Division has enabled us to
    build cases against the leaders of these powerful organizations by
    targeting their command and control communications with multi-
    jurisdictional criminal investigations based on state-of-the-art, court
    approved Title III electronic interceptions. We rely on the information
    and evidence gathered from these Title III interceptions of their
    communications to build a picture of the organizations, identify the
    individual members, and obtain evidence enabling us to make arrests and
    take apart whole sections of the criminal organizations at a time. The
    capability provided by SOD is at the core of our ability to make cases
    against the leadership and U.S.-based infrastructure of these powerful
    organizations that control the drug trade in our hemisphere.
        Our State & Local Task Force program carries out one of the DEA's
    priority initiatives: addressing the problem of drug-related violent
    crime with our state and local counterparts. There are currently 1,134
    Special Agent positions dedicated to this enforcement effort working
    alongside 1,868 State or local police officers in 203 Task Forces. Of
    this number, 45 task forces are funded through the HIDTA program.
        DEA's Mobile Enforcement Teams (METs) were conceived in 1995 in
    response to the overwhelming problem of drug-related violent crime in
    towns and cities across the nation. MET teams assist local law
    enforcement officers in identifying major drug traffickers and
    organizations that commit homicide and other violent crimes,
    collecting, analyzing, and sharing intelligence, arresting drug
    traffickers and assisting in the arrests of violent offenders and
    gangs, seizing assets, and assisting prosecutors. METs have completed
    294 deployments so far, with 18 more currently under way. There are 262
    DEA Special Agents assigned to the MET Program nationwide, comprising
    24 teams.
        The High Intensity Drug Trafficking Areas (HIDTA) program was
    authorized by the Anti-Drug Abuse Act of 1988 and is administered by
    the Office of National Drug Control Policy. Its mission is to reduce
    drug trafficking throughout the country by coordinating federal, state,
    and local law enforcement efforts.
        To ensure that criminals do not benefit financially from their
    illegal acts, federal law provides that profits from drug-related
    crimes may be legally seized. Asset forfeiture is an effective weapon
    because it removes the profit from illegal activities thereby
    financially disabling the drug-trafficking organizations. Property is
    seized by the DEA only when it is determined to be a tool for, or the
    proceeds of, illegal activities such as drug trafficking, organized
    crime, or money laundering. The DEA has also launched major operations
    specifically targeting the money-laundering capabilities of major
    trafficking organizations.
        DEA is also in the forefront of the forensic science industry.
    DEA's eight Regional laboratories make up the largest accredited
    federal lab system in the United States. They provide the best
    available forensic drug analysis to the law enforcement community.
    These Labs each serve a region of the country. The Northeast Laboratory
    is located in New York City, the North Central Laboratory in Chicago,
    the Southeast Laboratory in Miami, the South Central Laboratory in
    Dallas, the Southwest Laboratory in National City (CA), the Western
    Laboratory in San Francisco, and the Mid-Atlantic Lab in Washington,
    D.C. In addition, the Special Testing Laboratory is in the Washington,
    D.C. suburbs.
        The DEA's Computer Forensics Program (CFP) is the application of
    computer technology and specialized seizure and evidence handling
    techniques to retrieve information from computer systems for
    investigative or intelligence purposes. Like many other business
    people, drug traffickers rely on computers and electronic pocket
    organizers to store information. Modern law enforcement routinely
    encounters and seizes home computers, laptops, computer networks,
    pocket organizers, and magnetic media in every conceivable size and
    format. These items, when seized, are forwarded to the CFP for
    duplication and extraction of information in such a way as to preserve
    the integrity of the evidence in a court-admissible manner. The
    Computer Forensics Program was established in October 1994, and has
    processed hundreds of computer items and pieces of electronic equipment
    each year since then. Over the last five years, the number of cases and
    computer seizures have increased by approximately 30 percent each year.
        Most of the drugs in the illicit traffic are products of illicit
    processing or synthesis. Prior to 1988, there were virtually no legal
    impediments to obtaining the chemicals necessary to manufacture drugs
    of abuse, no records required to be maintained for inspection, and no
    penalties for negligence or willful diversion. However, the Chemical
    Diversion and Trafficking Act of 1988 extended the concept of commodity
    control to those chemicals most often used for the manufacture and
    synthesis of drugs of abuse. With the support of the State Department,
    the DEA pursued the same goal for incorporation into the U.N.
    Convention Against Illicit Drug Traffic of 1988 (the Vienna
    Convention). On these legal bases, DEA has established controls over a
    list of critical chemicals commonly diverted for the production of the
    major drugs of abuse.
                              major investigations
        Using the law enforcement tools available to today's DEA, as
    outlined above, in the past several years we have participated in a
    number of very significant investigations. These actions demonstrate
    not only the new sophistication of drug trafficking organizations at
    the beginning of the Twenty-First Century, but also the significance of
    the law enforcement response.
        We continue to carry out cutting-edge, sophisticated
    investigations, which successfully targeted major traffickers who had
    previously operated without fear of capture or prosecution in the
    United States, believing that only their low-level operatives were at
    risk. These operations underscore the importance of cooperation among
    international drug law enforcement agencies. Such operations benefit
    from the closest possible cooperation between the DEA and our foreign
    counterparts. These investigations will continue to lead to the
    dismantling of major portions of the most significant drug trafficking
    organizations operating today. Allow me to review just a few of DEA's
    recent successes.
        Operation Millennium, brought to a successful conclusion in 1999,
    effectively demonstrated that even the highest level traffickers based
    in foreign countries could not manage drug operations inside the United
    States with impunity. Operation Millennium was made possible by direct
    support from the governments of Colombia and Mexico. Operation
    Millennium effectively targeted major cocaine suppliers who had been
    responsible for shipping vast quantities of cocaine from Colombia
    through Mexico into the United States. Operation Millennium
    specifically targeted drug kingpin Alejandro Bernal-Madrigal, who, by
    his own admission, had been smuggling 30 tons, or 500 million dosage
    units, of cocaine into the United States every month.
        Operation Mountain Express was a joint operation between DEA's
    Special Operations Division and the Office of Diversion Control.
    Mountain Express targeted traffickers of the methamphetamine precursor,
    pseudoephedrine. Existing regulations make it possible for California-
    based Mexican criminal organizations to purchase multi-ton quantities
    of pseudoephedrine for use in methamphetamine production. Since January
    2000, SOD coordinated a number of multi-jurisdictional investigations
    targeting pseudoephedrine traffickers, many of whom were of Middle
    Eastern origin, using 11 wiretaps during the course of the
    investigations.
        Operation Tar Pit was a DEA led multi-jurisdictional investigation
    targeting a Mexican heroin transportation and trafficking organization
    based in Tepic, Nayarit, Mexico. Primarily, this organization imported
    multi-kilogram quantities of black tar heroin from Mexico into the
    United States. During the course of the operation, more than 30 Federal
    Title III investigations were conducted. In June 2000, a nationwide
    takedown occurred against Operation Tar Pit targets, which included the
    principal Mexican command and control members in Mexico, U.S. based
    cell heads, workers for each cell, couriers, and customers.
        In November 2000, the DEA, FBI, U.S. Customs Service, and Federal
    prosecutors culminated an 18-month investigation targeting a multi-
    ethnic, transnational MDMA (Ecstasy) and cocaine distribution
    organization, following-up on enforcement action by Dutch police in the
    Netherlands. The investigation, known as Operation RED TIDE, was a
    textbook example of the new multi-agency, multi-national law
    enforcement cooperation needed to thwart organized crime in the 21st
    Century. As a result of this cooperative effort, Customs agents seized
    1,096 pounds (2.1 million tablets) of MDMA, the largest single seizure
    of the drug in history. The head of the organization, Tamer Adel
    Ibrahim fled the United States after the seizure, but was quickly
    traced to Mexico and then to Europe by the multi-agency team. Ibrahim,
    along with others, was arrested and the Dutch National Police seized
    1.2 million tablets of MDMA.
        Operations like RED TIDE exemplify the unprecedented level of
    international law enforcement cooperation in effect today. The
    investigation targeting a transnational MDMA and cocaine trafficking
    syndicate was a cooperative effort by the U.S. law enforcement
    agencies, as well as the Dutch National Police/Regional Team South,
    Mexico's Fiscalia Especializad Para La Atencion De Delitos (FEADS), the
    Israeli National Police, the German Federal Police (Bundes Kriminal
    Amt), the Cologne Germany Police Department, the Duissburg Germany
    Police Department, the Italian National Police and the French National
    Police.
        This investigation is extremely important because MDMA (Ecstasy) is
    a new threat with the potential to cause great damage, especially to
    America's youth. Operation Red Tide has ensured that a large volume of
    Ecstasy that would have made it into the hands of our youth never hit
    the streets, and sent a strong message to the traffickers that the DEA
    is leading a truly global response to the drug threat.
        Last December, the DEA, together with U.S. Customs and the FBI,
    completed Operation Impunity II, resulting in 141 arrests and the
    seizure of 5,266 kilograms of cocaine, 9,325 pounds of marijuana, and
    approximately $9,663,265 in U.S. currency and assets. Impunity II
    follows earlier successes dating back to 1996 in Operation Limelight
    and Operation Impunity I and was the result of the outstanding
    coordination between federal, state, and local law enforcement
    officials and prosecutors across the country.
        Operation Impunity II was a multi-agency law enforcement effort
    that targeted a wide-ranging conspiracy to smuggle thousands of pounds
    of cocaine and marijuana from Mexico, across the southwest border into
    Texas, for distribution throughout the United States. Impunity II
    targeted an organization that placed managers in the United States and
    retained the organizational command and control elements in Mexico. In
    addition to remnants from the Carrillo-Fuentes organization, agents
    learned that some members of the Mexican Gulf Cartel had also become
    associated with the organization, including Osiel Cardenas-Guillen,
    allegedly a former Gulf Cartel lieutenant. In addition to the domestic
    enforcement activity in this country, the United States Government
    presented provisional arrest warrants for extradition for eight Mexican
    nationals in Mexico and one Dominican national in the Dominican
    Republic.
        In January of this year, Operation White Horse targeted a large
    scale heroin trafficking organization, directed by Wilson SALAZAR-
    Maldonado, which was responsible for sending multi-kilogram quantities
    of heroin from Colombia to the Northeastern United States via Aruba.
    The investigation was conducted jointly by the Colombian National
    Police, DEA Bogota, Curacao, Philadelphia and New York, and the Special
    Operations Division. This investigation resulted in 96 arrests, as well
    as the seizure of multi-kilograms quantities of heroin and cocaine,
    weapons and U.S. currency.
              current drug trafficking threat to the united states
        Drug law enforcement agencies face an enormous challenge in
    protecting American communities from drug traffickers who smuggle in
    cocaine, heroin, methamphetamine, and marijuana for distribution in
    U.S. neighborhoods as well as from domestic suppliers of these drugs.
    Cocaine Trends
        The primary U.S. drug threat is cocaine, particularly in its
    smokable form known as ``crack'' cocaine. The trafficking,
    distribution, and abuse of cocaine and crack cocaine over the past
    decade, along with increasing drug-related violence, seriously
    debilitate the quality of life in many cities and towns across the
    country. Most of this nation's drug law enforcement assets are directed
    against cocaine traffickers.
        Crack, the inexpensive, smokable form of cocaine, continues to be
    distributed and used in most major cities. While cocaine use in the
    United States has declined over the past decade, the rate of use in
    recent years has stabilized at high levels. Crack cocaine usage, which
    drove these rates, has reached the saturation point in large urban
    areas throughout the country. Street gangs, such as the Crips and the
    Bloods, and groups of ethnic Dominicans, Puerto Ricans, and Jamaicans
    dominate the retail market for crack cocaine nationwide.
    Heroin Trends
        Heroin is readily available in many U.S. cities as evidenced by the
    unprecedented level of average retail, or street-level, purity. The
    increased availability of high-purity heroin, which can effectively be
    snorted, has given rise to a new, younger user population. While
    avoiding the stigma and additional health hazards of needle use, this
    user group is ingesting larger quantities of the drug and, according to
    drug treatment specialists, progressing more quickly toward addiction.
                South American Heroin
        The availability of South American (SA) heroin, produced in
    Colombia, has increased dramatically in the United States since 1993.
    South American heroin is available in the major metropolitan areas of
    the Northeast and along the East Coast. Investigations also indicate
    the spread of South American heroin to smaller U.S. cities as well.
    Within the United States, ethnic Dominican criminal groups have played
    a significant role in retail-level heroin distribution in northeastern
    markets for at least the past two decades. Currently, Dominican groups
    dominate retail heroin markets in northeastern cities such as New York,
    Boston, and Philadelphia.
                Mexican Heroin
        Mexican heroin has been a threat to the United States for decades.
    It is produced, smuggled, and distributed by polydrug trafficking
    groups, many of which have been in operation for more than 20 years.
    Nearly all of the heroin produced in Mexico is destined for
    distribution in the United States. Organized crime groups operating
    from Mexico produce, smuggle, and distribute the black tar heroin sold
    in the western United States. Once the heroin reaches the United
    States, traffickers rely upon well-entrenched polydrug smuggling and
    distribution networks to deliver their product to the market, primarily
    in the metropolitan areas of the Midwestern, southwestern, and western
    United States with sizable Mexican immigrant populations.
                Southeast Asian Heroin
        High-purity Southeast Asian (SEA) heroin dominated the market in
    the United States during the late 1980s and early 1990s. Over the past
    few years, however, all indicators point to a decrease in SEA heroin
    available domestically. Despite the recent decline in trafficking of
    SEA heroin, Chinese criminal groups based in Asia remain the most
    sophisticated heroin trafficking organizations in the world.
                Southwest Asian Heroin
        While a large portion of Southwest Asian (SWA) heroin is consumed
    in Western Europe, Pakistan, and Iran, traffickers operating from
    Middle Eastern locales smuggle SWA heroin to ethnic enclaves in the
    United States. Criminal groups composed of ethnic Lebanese, Pakistanis,
    Turks, and Afghans are all involved in supplying the drug to U.S.-based
    groups for retail distribution. West African traffickers, who primarily
    smuggled SEA heroin to the United States in the 1990s, now also deal in
    SWA heroin.
    Methamphetamine Trends
        Domestic methamphetamine production, trafficking, and abuse are
    concentrated in the western United States. Methamphetamine is also
    increasingly available in portions of the South. Clandestine
    laboratories in California and Mexico are the primary sources of supply
    for methamphetamine available in the United States.
        Over the last decade, the methamphetamine trafficking and abuse
    situation in the United States changed dramatically. In 1994, ethnic
    Mexican drug trafficking organizations operating ``super labs'' (labs
    capable of producing in excess of ten pounds of methamphetamine in one
    24-hour production cycle) based in Mexico and California began to take
    control of the production and distribution of methamphetamine
    domestically. The entry of ethnic Mexican traffickers into the
    methamphetamine trade in the mid-1990s resulted in a significant
    increase in the supply of the drug.
        The primary points of entry into the United States for
    methamphetamine produced in Mexico have traditionally been California
    ports of entry, particularly San Ysidro. Although a great amount of
    methamphetamine still transits this area, ports-of-entry in south Texas
    are experiencing significant increases in smuggling activity.
        The vast majority of methamphetamine precursor chemicals diverted
    to clandestine laboratories in the United States are dosage-form
    pseudoephedrine or ephedrine drug products. They are usually purchased
    from U.S. manufacturers and distributors who sell case quantities of
    the tablets. The finished methamphetamine is then distributed
    throughout the United States through preexisting smuggling methods to
    the traffickers.
    Marijuana Trends
        Marijuana is the most widely abused and readily available illicit
    drug in the United States with an estimated 11.5 million current users.
    At least one-third of the U.S. population has used marijuana sometime
    in their lives. The drug is considered a ``gateway'' to the world of
    illicit drug abuse.
        Marijuana smuggled into the United States, whether grown in Mexico
    or transshipped from other Latin American source areas, accounts for
    most of the marijuana available in the United States. Marijuana
    produced in Mexico remains the most widely available. Moreover, high-
    potency marijuana enters the U.S. drug market from Canada. The
    availability of marijuana from the Far East, primarily Thailand,
    generally is limited to the West Coast. U.S. drug law enforcement
    reporting also suggests increased availability of domestically grown
    marijuana.
    MDMA Trends
        Commonly referred to as Ecstasy, XTC, Clarity or Essence, the
    chemical substance known as 3, 4-methylenedioxymethamphetamine (MDMA)
    is a synthetic psychoactive drug possessing stimulant and mild
    hallucinogenic properties. In the early 1990s, MDMA became increasingly
    popular among European youth. However, it is within the last five years
    that MDMA use in the United States has increased at an alarming rate.
        Although the vast majority of MDMA consumed domestically is
    produced in Europe, a limited number of MDMA laboratories operate in
    the United States. Law enforcement seized seven clandestine MDMA
    laboratories in the United States in 2000 compared to 19 seized in
    1999. It should be noted that these labs were primarily capable of
    limited drug production. While ``recipes'' for the clandestine
    production of MDMA can be found on the Internet, acquiring the
    necessary precursor chemicals in the United States is difficult.
        MDMA is manufactured clandestinely in Western Europe, particularly
    in the Netherlands and Belgium. Much of the MDMA is manufactured in the
    southeast section of the Netherlands near Maastricht. International
    MDMA traffickers based in the Netherlands and Belgium consistently use
    other European countries, such as France, England, Germany, and Spain
    as transshipment points for MDMA shipments destined for the United
    States. Russian, Israeli and European criminal organizations, the
    principal traffickers of MDMA worldwide, supply the United States with
    the drug.
                                 drug diversion
        The purpose of DEA's Drug Diversion Control Program is to prevent,
    detect, and investigate the diversion of controlled substances from
    legitimate channels. The goal is to ensure that these ``controlled
    substances'' are readily available for medical use, while preventing
    their distribution for illicit sale and abuse.
    OxyContin
        OxyContin is a Schedule II controlled release form of the
    narcotic oxycodone. It is legitimately used as a medication to treat
    moderate to severe pain and is becoming the drug of choice in many pain
    management clinics. In a little over four years, sales have reached $1
    billion.
        The pharmacological effects of OxyContin make it
    attractive to abusers as it offers reliable strength and dosage levels
    and may, in some instances, be covered by the abuser's health
    insurance. Abusers have discovered that the controlled release formula
    of OxyContin can be easily compromised by inhalation or
    injection resulting in a powerful, morphine-like high.
        Reports of the diversion and abuse of OxyContin are
    currently concentrated in rural areas of the eastern United States;
    however, DEA's Office of Diversion Control has identified this activity
    as a growing problem throughout the nation. This is consistent with the
    increase in emergency room episodes involving oxycodone. The estimated
    number of episodes involving oxycodone were stable from 1990 through
    1996. However, the number of emergency room episodes doubled from 1996
    to 1999: 3,190 episodes in 1996 to 6,429 in 1999.
        In order to combat the serious and growing problems stemming from
    the diversion and abuse of OxyContin, DEA has developed and
    initiated its first national action plan for a prescription medication.
    The elements of this plan are: coordinating enforcement and
    intelligence operations, to include interagency efforts; utilizing
    regulatory and administrative authorities, including the support of
    other regulatory agencies; seeking industry cooperation; and
    implementing aggressive education and outreach efforts.
                          impact on the united states
        None of the major drug traffickers headquartered overseas could
    operate without the assistance of national and regional drug
    trafficking organizations which are responsible for trafficking huge
    quantities of drugs into U.S. communities. These organizations are
    comprised of a network of operatives who transport, store and
    distribute drugs and collect and repatriate drug proceeds throughout
    the United States and whose activities are directed by drug lords based
    in foreign countries. In many cases, national and regional drug
    trafficking organizations are comprised of numerous cells whose
    directors are responsible for specific tasks such as communications,
    financial matters and/or logistics. These cell heads are sent to the
    United States for a period of time to carry out the business mandates
    of the top drug lords and are given specific tasks to accomplish. The
    national and regional drug syndicates have infiltrated many states and
    communities, bringing with them the crime and violence once limited to
    major urban areas. A survey of recent DEA investigations revealed that
    over 400 investigations stemming from Operations Reciprocity and
    Limelight involved drug traffickers from foreign countries who had set
    up operations in various cities across the United States.
        Local violent drug trafficking organizations also operate across
    the United States and are responsible for eroding the quality of life
    in many American communities. Previously centered in major urban areas,
    violent drug trafficking groups are now part of the landscape in
    smaller cities and rural areas. Fueled in large part by methamphetamine
    production and trafficking, violent drug trafficking organizations are
    now affecting the crime rates in smaller cities such as Spokane,
    Washington and Cedar Rapids, Iowa. While these local, violent groups
    appear to be unrelated to the large international drug trafficking
    organizations headquartered overseas, it is important to note that all
    of the cocaine and heroin that is trafficked by these groups is
    produced overseas and transported to the United States for eventual
    distribution on the local level.
                                demand reduction
        The number one goal of the National Drug Strategy is to educate and
    enable America's youth to reject illegal drugs as well as alcohol and
    tobacco. DEA believes that there is a role for everyone to play in this
    goal, including law enforcement. Law enforcement may not take the lead
    in demand reduction efforts, but it has a unique perspective and wealth
    of experience to bring to the prevention arena. DEA special agents have
    seen first hand the terrible impact of drug abuse in communities, and
    speak with a compelling authority in explaining to citizens why this
    problem needs to be conquered. They also have great expertise in
    planning, organizing and implementing proactive efforts to deal with
    drug abuse.
        As an example of DEA's contribution to drug prevention, Demand
    Reduction Coordinators (DRC's) have been instrumental in working with
    media to place public service announcements from the Partnership for a
    Drug-Free America in support of the President's Youth Media Campaign.
    Demand Reduction Coordinators worked collaboratively with state and
    local authorities to produce an educational video (several thousand
    distributed to date) for adults and adolescents in the Midwest to
    educate them about the dangers of methamphetamine. In New York and
    Washington, D.C., Demand Reduction Coordinators developed an ad
    campaign geared to engaging youth that is being posted on busses,
    subway trains, and taxis. And the Demand Reduction Section has
    participated in satellite video conferences that were broadcast all
    over the United States.
        Additionally the Demand Reduction Section, the Bureau of Justice
    Assistance, and the National Crime Prevention Council have conducted
    seminars for teams of community leaders from cities and towns that
    received MET deployments. The objective is to educate community leaders
    to start programs that prevent the return of the drug trafficking and
    violent crime that plagued their neighborhoods. CPD hosted a group of
    national experts in drug and crime prevention to review the proposed
    curriculum for this training.
        The DEA web page is yet another way of reaching a large segment of
    the public with demand reduction information both for young people and
    their parents. But not everyone has access to computers, or is
    computer-literate. Therefore, DEA also reaches the public through
    publications and direct contact such as seminars, conferences and
    meetings with youth, parents, employers, employees, businesses,
    community and civic groups, teachers, coaches, clergy, prisoners, as
    well as law enforcement personnel.
        The driving force behind DEA's demand reduction program has always
    been the particular credibility that law enforcement, and especially
    federal law enforcement officers bring to the drug prevention arena.
    DEA agents possess a certain authority because of their background and
    job experiences, which play an important role in the overall drug
    demand reduction picture. This is why DEA's current demand reduction
    program has been so successful.
                              dea's strategic plan
        In order to meet the enormous challenges posed by internationally-
    based narcotics traffickers and their surrogates within the United
    States, DEA has developed a five-year Strategic Plan which is a key
    part of our commitment to establish and maintain a clear focus on the
    outcome of our efforts. In its unique capacity as the world's leading
    drug enforcement agency, DEA carries out its legal mandate for
    enforcing provisions of the controlled substances and chemical
    diversion, trafficking laws and regulations, and serves as the single
    point of contact for the coordination of all international drug
    investigations.
        To ensure mission success, DEA attacks all levels of drug
    trafficking using both traditional and innovative drug control
    approaches, focusing its enforcement operations on the full continuum
    of drug trafficking. This overall strategic approach is based on the
    recognition that the major drug traffickers, operating both
    internationally and domestically, have insulated themselves from the
    drug distribution networks but remain closely linked to the proceeds of
    their trade. Consequently, the identification and forfeiture of
    illicitly derived assets is a powerful tool in successfully destroying
    the economic base of the drug trafficking organization, as well as a
    means of proving a connection between violators and a criminal drug
    conspiracy at the time of prosecution.
        In view of this assessment, DEA's investigative efforts are
    directed against the major international drug trafficking organizations
    and their facilitators at every juncture in their operations--from the
    cultivation and production of drugs in foreign countries, to their
    passage through the transit zone, and eventual distribution on the
    streets of America's communities. DEA's Strategic Plan takes into
    account the current drug trafficking situation affecting the United
    States, and works to identify the characteristics and exploit the
    vulnerabilities of all three levels of the drug trade. By focusing
    directly on the agency's investigative priority targeting system, DEA
    responds to each of the following levels simultaneously:
        International Targets.--DEA will eliminate the power and control of
    the major drug trafficking organizations and dismantle their
    infrastructure by disrupting and dismantling the operations of their
    supporting organizations that provide raw materials and chemicals,
    produce and transship illicit drugs, launder money worldwide, and halt
    the operations of their surrogates in the United States.
        National/Regional Targets.--DEA will continue an aggressive and
    balanced enforcement program with a multi-jurisdictional approach
    designed to help focus Federal and interagency resources on illegal
    drug traffickers, their organizations and key members who have control
    of an area within a region of the United States, and the drugs and
    assets involved in their activities.
        Local Initiatives.--DEA will continue to assist States and
    localities in attacking the violence that plagues our cities, rural
    areas, and small towns to protect our citizens from the impact of
    drugs, and help restore a positive quality of life. DEA considers this
    an important part of its overall strategy to complement the state and
    local efforts with specialized programs that bring DEA's intelligence,
    expertise, and leadership into specific trouble spots throughout the
    nation.
        In each of the aforementioned forums, DEA seeks to identify,
    target, investigate, disrupt, and dismantle the international,
    national, state, and local drug trafficking organizations that are
    having the most significant impact on America. DEA's strategic goals
    reflect the agency's efforts to use its unique skills and limited
    resources in a manner designed to achieve maximum impact. This requires
    maintaining a clear focus on Deals core competency--the destruction and
    dismantlement of drug trafficking organizations. The implementation of
    DEA's strategic plan is carried out with the ``holistic'' approach,
    which I mentioned at the beginning of my statement. This approach
    addresses the problems posed by illicit drug availability and abuse and
    provides for a comprehensive approach of interdiction and enforcement,
    coupled with education, prevention and treatment.
        Mr. Chairman, that concludes my prepared remarks. I will be happy
    to take any questions you may have for me at this time.

            [ins] deg.more Immigrants entering the country

        Senator Gregg. Thank you very much, and we will include
    your written statements in the record.
        Commissioner, you mentioned that in the last decade we had
    more immigrants coming into the country than in any period in
    the country's history?
        Mr. Rooney. Yes. It was rather surprising to me, but in the
    last decade more than in any other decade, including the
    beginning of the last century, the first 10 years, which is
    rather staggering.
        Senator Gregg. Are you referring to legal and illegal, or
    are you just talking about legal immigrants?
        Mr. Rooney. Legal.
        Senator Gregg. Legal immigrants. And what percent----
        Mr. Rooney. I am talking about applications that come in,
    yes.
        Senator Gregg. Applications?
        Mr. Rooney. Right. The processing of applications for
    benefits.
        Senator Gregg. All right. And what percentage of those
    folks become citizens?
        Mr. Rooney. I do not know that off hand.
        Senator Gregg. Now, you said you had an 80 percent increase
    in applications last year and 50 percent over last year this
    year?
        Mr. Rooney. Yes. The applications this year, in 2000, were
    50 percent more than the previous year and 80 percent more than
    the year before that.
        Senator Gregg. And what percentage of those applications do
    you approve?
        Mr. Rooney. Well, looking at two different types of
    applications.
        We take the naturalization applications, for example, Mr.
    Chairman, in fiscal year 2000, we completed 1.3 million of
    those and reduced the backlog down to 800,000. The backlog
    previously had been 1.8 million. So we are on our way to
    getting that backlog eliminated, which is part of the
    President's 52-year plan to do that.

                   [ins] deg.Guest worker proposals

        Senator Gregg. Right. Have you taken a look at all of the
    guest worker proposals that have been floating around? The
    President talked, I guess, to President Vicente Fox about it,
    and it has been mentioned a number of times by Senator Gramm.
        Mr. Rooney. Yes, Mr. Chairman. In fact, I had the
    opportunity in my first week at INS, about 5 or 6 weeks ago, to
    participate in the first round of those talks with the Mexican
    Government.
        The President put the Attorney General and Secretary Powell
    as the head of the talks, and a staff group from the State
    Department and Justice and INS--INS is part of Justice--
    participated in those. And there have been several proposals
    that have come forward in the last week.
        The guest worker program, employment opportunities, is
    clearly a priority of the Mexican Government in those talks.
    And at the moment, we have looked at Senator Gramm's guest
    worker proposals, and we have looked at some of the other
    proposals that previously had been introduced in the Congress,
    and they vary. But we are working closely with the other
    agencies.
        Senator Gregg. Well, as a general statement, what do you
    think the effect of a guest worker program would be on illegal
    immigration coming over the Mexico border?
        Mr. Rooney. The past problems with the types of programs
    that we have had, going back to the Bracero program several
    years ago, is that the people come into work and then they
    stay. Now, of course, the argument can be made, ``Well, people
    are coming in to work illegally and staying.'' But in general,
    the programs differ in many different ways.
        The Mexican Government is particularly interested in the
    opportunity for people to come in in a circularity concept;
    people coming in, working, and going home.
        One of the proposals would be opened only to agriculture
    workers. Other proposals would be opened to a broader range of
    workers.
        Some would offer the opportunities to apply ultimately for
    adjustment of status for permanent residency or citizenship.
    Other proposals would not.
        But if we can keep track--and this is a major part and a
    burden that falls upon INS, of improving the data systems so
    that we can monitor income and outgo of the people who would be
    part of these programs--it would certainly go a long way toward
    making it less likely that illegals would come in and stay.

                       [ins] deg.Detention space

        Senator Gregg. Now, you said you had 1,600 new beds under
    this proposal. How many new beds do you actually need?
        Mr. Rooney. I do not know if I could give you a direct
    response. The 1,600 bed request, which was made and is being
    made here before the Congress, is consistent with the
    projections. So we have about 19-some odd now, 19,000, and
    1,600 would put us just over----
        Senator Gregg. So if we funded that, you would have
    adequate detention capability so that you would not have to be,
    as you say, going through a training exercise anymore.
        Mr. Rooney. We believe so. Now, we also are very interested
    and hopefully the agency will be aggressive about looking at
    some alternatives to detention and exploring in more depth some
    of the programs that we have already experienced in the past
    where there has been success, so that we can free up some of
    those beds.

                  [ins] deg.Border Patrol facilities

        Senator Gregg. The border facilities, which the Border
    Patrol use, are in pretty tough shape. In fact, my staff tells
    me that 63 of the 85 outposts on the Southwest border are
    overcrowded. Is that accurate?
        Mr. Rooney. Yes, that is, Mr. Chairman. I think we have
    about 70 facilities that are at double the capacity for the
    number of agents.
        Senator Gregg. And under the budget that you have sent up,
    what is the workout time to get those facilities into a
    percentage that is reasonable?
        Mr. Rooney. The budget here does not focus much on
    increases for that purpose. We have some projects going on, and
    the focus, though, here has been to get more agents.
        Senator Gregg. Where are you going to put them?
        Mr. Rooney. We are going to increase the population of each
    of those Border Patrol stations.
        Senator Gregg. Now, do you have--I presume you have sent it
    to us--but do you have the facilities' workout sheet that would
    tell us what we would need to spend in order to bring these----
        Mr. Rooney. Yes. I do not have it handy, but we certainly
    can get it to the subcommittee. We have a long-range plan for
    all of our facilities, vehicles, fences, et cetera,
    helicopters, replacement plans, but unfortunately the funding
    has simply not been available.
        Senator Gregg. Okay. I have some questions for you too,
    Administrator Marshall, but I wanted to let Senator Murray go.
        [The information follows:]

          [ins] deg.Facilities Construction Funding Requests

        While Congress has consistently provided Immigration and
    Naturalization Service (INS) facilities construction funding,
    including $133 million in fiscal year 2001, and $128 million
    included in the fiscal year 2002 President's budget, Border
    Patrol facilities funding has not kept pace with the growth in
    new agents. INS has a facilities shortfall that it is
    addressing through a long-range plan. However, the backlog in
    facilities will require a number of years to overcome.

                 [ins] deg.Long-Range Facilities Plans

        The long-range facilities plans workout sheets for the
    Immigration and Naturalization Service were delivered to the
    Subcommittee in July 2001.

                       [ins] deg.Northern border

        Senator Murray. Thanks very much, Mr. Chairman.
        Mr. Rooney, I particularly want to address my comments to
    you, although you may have some responses as well.
        I am really concerned about the lack of commitment the INS
    has had in recent years on the northern border. The level of
    staff for the Border Patrol inspections hasn't grown at the
    northern border but threats of drug trafficking and terrorist
    attacks have grown substantially.
        We have seen commercial traffic moving across the northern
    border, and it has increased by more than 30 percent over the
    last decade. Our incidence of drug trafficking have increased
    threefold during that same time. And many of the world's
    terrorist groups have established themselves in Canada, they
    seek safe haven, they set up operational bases, and they
    attempt to gain access to the United States.
        And I think the incident last year with Ahmed Ressam in
    December of 1999 actually, who was trying to cross into the
    State of Washington from Canada with 100 pounds of bomb-making
    supplies, is just one example of what our northern border folks
    have to deal with.
        We are seeing an increasing number of criminal enterprises
    set up above our northern border that our Border Patrol has to
    deal with.
        An inspector general report was published last year--I am
    not sure if you are familiar with it--but it said that there
    were 300 Border Patrol agents assigned to patrol the entire
    4,000 miles of border between Canada and the United States.
    That is one agent for every 13 miles of border.
        Now, in comparison, on the Southwest border, it is 2,000
    miles and has 8,000 agents, so they have four agents for every
    mile. They have four for every mile; we have one for every 13
    miles.
        I think that that is significant, particularly with the
    increasing problems we are having with drug trafficking and
    terrorism that we see.
        And I will add that traffic across our border is just
    awful. We hear complaints on a constant basis. It is
    increasing, the lines are increasing. We have a good
    relationship with our friends north of the border, and we do a
    lot of trade, and the traffic is really impacting the economy
    as well.
        I am happy to see that your proposed budget adds 570
    additional Border Patrol agents in 2002 and 2003 and fully
    funds the 5,000 positions, but this increase is not going to
    achieve the level of control that is outlined in your own
    strategic plan.
        And I think I am concerned that your plan looks at the
    Southwest border to deal with that before the problems of the
    northern border, where we are seeing incredible problems that
    have developed. And my own constituents are becoming
    increasingly concerned about that.
        I think if we are going to meet those threats, a
    substantial portion of the new border agents and inspection
    staff have to be deployed at the northern border. And I have
    submitted a request actually to this committee to require that
    25 percent of those new Border Patrol agents be assigned to the
    northern border.
        I wanted your comments on that, to see if you would support
    it, and to find out whether you think that the INS staffing on
    the northern border is adequate.
        [The statement follows:]
                   Prepared Statement of Senator Patty Murray
        Mr. Chairman, thank you.
        Mr. Rooney, I appreciate you coming before this committee.
        I am very concerned about the lack of commitment the INS has had in
    recent years to protecting the Northern Border. The level of staff for
    Border Patrol and Inspections have not grown at the Northern Border
    despite large increases in your budget, but the threats of drug
    trafficking and terrorist attack have grown substantially.
        Several developments over the last decade have made security at the
    Northern Border a major concern.
      --Commercial traffic moving across the Northern Border has increased
            by more than 30 percent over the last decade.
      --Incidents of drug trafficking have increased three-fold during that
            same period.
      --Many of the world's terrorist groups have established themselves in
            Canada, seeking safe haven, setting up operational bases and
            attempting to gain access to the United States. The arrest of
            Ahmed Ressam in December of 1999, who was trying to cross into
            the state of Washington from Canada with 100 pounds of bomb
            making supplies, is one frightening example of our security
            concerns at the Northern Border.
        It is clear that criminal enterprises see the Northern Border as
    easy access to the United States, when compared to the iron fence they
    meet when they try to enter the United States through Mexico.
        An Inspector General report published last year underscores my
    point. The report noted that there are only about 300 Border Patrol
    Agents assigned to patrol the entire 4,000 miles of border between the
    two countries.
        That is about one agent for every thirteen miles of border.
        In comparison, the Southwest Border is 2,000 miles and has 8,000
    agents.
        Four agents for every mile.
        It found that Northern Border agents were fourteen times more
    likely to encounter aliens involved with smuggling weapons, and they
    were nine times more likely to encounter aliens involved with smuggling
    drugs when compared to agents along the Southwest Border.
        Many other studies have shown that inspection staff at the Northern
    Border is also inadequate to address its needs. In fact, in the state
    of Washington, traffic is often stacked up for miles at many of our
    Washington state/Canadian border crossings, and this traffic has gotten
    progressively worse. They simply lack the inspection staff to handle
    the traffic.
        The Illegal Immigration Reform and Immigrant Responsibility Act of
    1996 authorized 5,000 additional Border Patrol agents. To date, only
    3,860 positions have been funded.
        I am pleased that the Administration's proposed budget for fiscal
    year 2002 would add 570 additional Border Patrol agents in both 2002
    and 2003, fully funding the 5,000 positions.
        However, this increase will not allow the Border Patrol to achieve
    the level of control outlined in your own strategic plan.
        This plan outlines achieving control of the Southwest Border before
    dealing with problems on the Northern Border. Considering this focus on
    the Southwest Border, it would take 161 years before Northern Border
    the INS turned to the concerns of the Northern Border.
        It is obvious that the proposed strategy of achieving control of
    the Southwest Border before turning attention to the Northern Border is
    unrealistic and short-sighted. The Border Patrol and inspection staff
    need to develop a unified strategy that focuses the limited resources
    on as many areas of activity as possible. This strategy must be
    flexible enough to quickly adapt to the inevitable shifts in such
    activity. It does little good to maintain control over small stretches
    of border when the rest of the border is overwhelmed.
        It is clear that if we are to meet the threats that exist at the
    Northern Border, a substantial proportion of new Border Patrol agents
    and Inspection staff must be deployed at the Northern Border. I have
    submitted a request to this committee requiring that at least 25
    percent of new Border Patrol agents be assigned to the Northern Border.

        Mr. Rooney. Yes, Senator.
        First of all, going to the strategy, the plan, you are
    correct in that our procedures for implementing the border
    control plan is on the Southwest border first in San Diego and
    El Paso, et cetera, and ultimately to include the Northern
    border.
        But as you indicated, the lines that are growing for people
    coming in, not on the Border Patrol side, but on the inspection
    side, that is a situation that we are aware of and that we are
    trying to address.
        And what we have done is we have taken a workload analysis
    model of ideal staffing at the borders all over the country.
    And with the available resources, both Border Patrol agents and
    inspectors--and I must say, it is not 25 percent for the
    northern border. I am not sure exactly what the breakdown,
    maybe somebody here has it.
        But increased agents as well as inspectors are deployed in
    accordance with a percentage of the overall needs at the
    border. And we are clearly not----

            [ins] deg.meeting needs at the Northern border

        Senator Murray. Do you take into account the increasing
    needs at the northern border? I am concerned that your
    strategic plan, focusing on the south border, is ignoring the
    facts of the increased jeopardy we are placing our staff at the
    northern border in. The morale is low. We are having trouble
    retaining or recruiting any agents, because it is a dangerous
    job.
        And I am worried that your strategic plan will simply mean
    that all of the new border patrols will go to the south border,
    and we will be left behind in the northern border at an
    increasingly difficult time.
        Mr. Rooney. Well, yes, the strategic plan does focus more
    on the deterrent effect starting at the Southwest border.
        The staffing plan, however, where we look at both Border
    Patrol agents as well as inspectors, we take an overall picture
    of what the need is, and then based upon the number of agents
    that we have, we fill the need. That need, particularly in the
    inspections area, which you also mentioned, is based upon the
    percentage that would naturally be--for example, if we needed
    1,000 more, and 300 were at the northern borders, then if we
    got a hundred, 30 would go to the northern borders, on
    inspections.
        Senator Murray. Well, I am asking that as you take a look
    at where you place those, both inspection agents and border
    patrols, that you recognize the extreme difficulty we are
    putting those folks in today, and that they are being asked to
    do a job that is much more complex than on our southern border,
    because of the miles that they have to cover, particularly our
    Border Patrol, obviously.
        And we have had a problem in the past with INS transferring
    a number of our agents to the southern border every time there
    is a problem and leaving our border even more impacted.
        And can you assure me that that will not occur, under your
    watch, that we will not just simply see our Border Patrol
    agents transferred to the south when we know how important that
    is that they be on the northern border?
        Mr. Rooney. Well, we certainly will. Anytime we have an
    emergency situation--and we actually have had some up on the
    Northern border at times, particularly the concern about the
    demonstrations that were going on up there last month. But,
    yes, generally we would try not to do that, move them out of
    the north to the south.

                       [ins] deg.Workload models

        Senator Murray. I have met and talked with our Border
    Patrol, in particular, many times. And it is a very tough duty
    we are asking them to do.
        There is increasing terrorist activity that has developed
    in Canada and comes across at my border. And we want to make
    sure we are not forgotten, as these new agents are put into
    place. I think that that is extremely critical.
        And finally, we have not seen the workload model that you
    are referring to. And if I could get a copy of that, I would
    really appreciate it.
        Mr. Rooney. Sure. We will provide you what we can,
    certainly.
        Senator Murray. Okay. Thank you very much.
        Thank you, Mr. Chairman.
        Senator Gregg. Thank you, Senator.
        Yes, we have a border crossing in New Hampshire. We have
    three or four moose there, and we have actually had an agent
    come through once or twice.

                 [dea] deg.DEA's progress with Mexico

        Mr. Marshall, what sort of progress are we making with
    Mexico?
        Mr. Marshall. I just visited Mexico about a month ago, and
    I met with the Attorney General and a number of other Cabinet
    members. And I am optimistic, cautiously optimistic, about our
    prospects in Mexico.
        I believe that the Fox administration has some good ideas.
    I believe that they want to do the right thing. President Fox
    has announced his priorities as addressing corruption and drug
    trafficking. And from some of the actions that the Government
    has taken since he has been in office, I believe he is making
    steps in that direction.
        He has done a number of things in the corruption area. One
    of the most significant, I think, is creating a system where
    they track officers that are fired from agencies for
    corruption, so it is not as easy for those officers to move to
    some other agency in some other part of the country and get
    rehired without knowing their history. That is a good sign.
        The Administration has made progress on extradition. We
    have actually very recently, within the last week or two,
    extradited the first top-echelon Mexican citizen drug-
    trafficker, that person being Arturo Paez.
        I have long said that extradition of the top drug kingpins
    out of Mexico is the first step toward breaking the cycle of
    corruption and intimidation, and allowing us to work with our
    partners in Mexico to really create a climate where we can
    begin to address all of these issues.
        Now, I want to temper that optimism, however, with a bit of
    realism. And the realism is that corruption does pervade many
    institutions in Mexico, not only public institutions, such as
    law enforcement, the judiciary and the prosecutors, but also
    private institutions with which we have to work; utility
    companies, telephone companies and things of that sort.
        So while I am very optimistic that the Fox administration
    is moving in the right direction, we need to recognize that it
    is a monumental problem, and it will take time to fix. But I
    believe that the Fox Government is making the right first steps
    in that direction.

                     [dea] deg.OMB budget request

        Senator Gregg. Did you make any submissions to OMB that
    were not funded?
        Mr. Marshall. Well, we have a budget formulation process,
    obviously. And I suppose any agency probably never gets 100
    percent of its budget request. But I will report to you,
    Senator, that the three broad areas of enhancements that we did
    receive were among my very top priorities.
        And I have a strategic plan that I have established for
    DEA, and I believe these are the top three that I need to move
    us in the right direction in that strategic plan. I would
    expect future budget requests to have more items that will move
    us further in that direction in the areas of intelligence,
    infrastructure, the Special Operations Division that I talked
    about, and computer forensics, perhaps.
        But I am pleased that we got our top priorities, and that
    will allow us to move in the right direction.

                  [dea] deg.Methamphetamine resources

        Senator Gregg. Do you have all the resources you need in
    the methamphetamine area?
        Mr. Marshall. We have increased our resources to
    methamphetamines substantially over the last 3 or 4 budget
    years, I would say.
        And again, Senator, if you ask any field commander, I
    suppose, or any head of an agency, ``Do you have everything
    that you need to adequately address the problem?'' the answer
    is generally going to be, ``I could use more resources.''
        But we have made progress on methamphetamine. We have put
    resources in there, and I am pleased with the progress that we
    have made.

                     [dea] deg.DEA/FBI cooperation

        Senator Gregg. How are the efforts of cooperation at the
    agent level with the FBI?
        Mr. Marshall. It is very good. We have had a relationship
    that has been in existence for now, I suppose, close to 20
    years with the FBI having Title 21 jurisdiction. And that
    relationship, frankly, was a bit rocky when it started out in
    the early 1980s.
        But we have committed to a partnership. We have committed
    to a productive relationship and a cooperative relationship.
    And we are working together very well, particularly in our
    Special Operations Division, where most of our substantial
    national operations come out of now.
        Now, the relationship obviously is never totally problem-
    free, as you would expect with any two agencies, but we have
    very good cooperation. I would say that the cooperation between
    DEA and FBI, and really among law enforcement in general,
    Senator, is better now than I have ever seen it in my career.

                 [dea] deg.Quantico training facility

        Senator Gregg. Well, we hear grumblings that the DEA and
    the FBI have turf issues. And this has been a hangup of mine
    for a long time, as you know, and it is the reason I was
    willing to build the building at Quantico for DEA, because I
    wanted to at least start the agents out going to school
    together.
        And I am not even sure that that is worked out down there.
    I have a sense that you are operating pretty independently,
    down there, of each other.
        But I do hope, and I am concerned with Director Freeh's
    leaving, because I know he was committed to this. I am
    concerned that there is no systematic activity in place to
    create cross-culture cooperation.
        Mr. Marshall. Senator, we have done a number of things. As
    you referred to, we shared the FBI Academy down there for our
    training purposes for, I suppose, it was close to 10 years. And
    during that time, we did build good relationships.
        Now, that also caused some problems. I mean, there were
    space problems, as you would expect when a space is designed
    for one agency and then you have two agencies in there. And the
    space was basically the reason that we separated our academies.
        Periodically, we do other things, such as, joint Special
    Agent in Charge conferences. We do cross-detailing and cross-
    assignments of agents in many cases--our agents to their office
    and theirs to ours. We have in many places FBI agents or FBI
    supervisors running drug routes. We have DEA agents supervising
    FBI agents in some of those drug routes. We have HIDTA task
    forces. We have Organized Crime Drug Enforcement Task Forces.
    We are working together in many, many arenas.
        And I think that what Director Freeh and I have done to
    cement that was to establish our own very close relationship.
    We consult very frequently, and we let it be known very vocally
    that we expect cooperation among our two agencies.
        And while there are grumblings from time to time, and while
    there are some issues occasionally, I would characterize those
    really as bumps in the road, not major potholes. And they are
    issues that we generally work through very quickly.
        Senator Gregg. Well, I thank you both for your testimony.
        We look forward to working with you. We know you both have
    huge obligations, huge areas to cover. And this committee
    certainly intends to try to be supportive and give you the
    resources you need to accomplish it.
        Good luck.
        [The following questions were not asked at the hearing, but
    were submitted to the agencies for response subsequent to the
    hearing:]
           Questions Submitted to the Federal Bureau of Investigation
                Questions Submitted by Senator Pete V. Domenici
                black tar heroin and methamphetamine trafficking
        Question. This Subcommittee has been very helpful over the past two
    years in tackling an issue of great concern to me. That issue is the
    serious ``black tar'' heroin problem that has plagued several northern
    New Mexico counties.
        Both the Federal Bureau of Investigation (FBI) and the Drug
    Enforcement Administration (DEA) have cooperated with the state and
    local law enforcement officials in New Mexico to try to break the
    serious cycle of black tar heroin trafficking and use. Several major
    drug busts have been implemented in this area of New Mexico.
        Would you please give the subcommittee the Department's assessment
    of the progress these joint law enforcement operations in breaking the
    Black Tar Heroin ring in Northern New Mexico?
        Answer. In December 1999, DEA's Special Operations Division
    initiated ``Operation Tar Pit,'' a multi-jurisdictional investigation
    targeting a Mexican heroin trafficking organization. The FBI's
    Albuquerque Division, the DEA and the New Mexico State Police (NMSP)
    with other local LEAs in northern New Mexico have focused this
    investigation on a well-entrenched heroin distribution organization
    controlled by individuals from Tepic, Nayarit, Mexico. Primarily, this
    organization smuggles multi-kilogram quantities of high purity Mexican
    black tar heroin from Mexico into the United States along the
    California and Arizona borders. However, one of the organization's
    primary distribution cells was located in northern New Mexico. The
    organization routinely sent couriers and distributors from Nayarit to
    the United States to transship and sell heroin. After approximately 6
    months, the leaders of the organization would order the distributors
    back to Mexico and other individuals would be sent as replacements.
        On June 15, 2000, a nationwide takedown of ``Operation Tar Pit''
    targets occurred in several cities throughout the United States. In New
    Mexico, 34 subjects were arrested and prosecuted, with all of these
    subjects convicted of drug-related offenses. To date, ``Operation Tar
    Pit'' has resulted in the seizure of approximately 64 pounds of high
    purity black tar heroin, $300,000, numerous vehicles, 10 weapons, 1
    residence, and the arrest of 249 individuals.
        The FBI, DEA, NMSP and the various state and local law enforcement
    agencies continue to work closely together to target heroin
    distribution organizations operating in northern New Mexico. These
    investigations, in conjunction with ``Operation Tar Pit,'' have greatly
    reduced the availability of black tar heroin and its associated crime
    problems. Also, multi-agency efforts targeting multiple organized
    criminal enterprises involved in drug trafficking show considerable
    result and only through a sustained multi-agency effort will LEAs be
    able to eliminate the distribution and use of heroin as a major drug
    problem in northern New Mexico.
        In fiscal year 2001, the FBI allocated 21 agents to the Albuquerque
    Division and local resident agencies to address the drug problem. The
    Albuquerque Division has 2 agents assigned to the DEA task force. This
    task force relationship maximizes both the FBI's and the DEA's
    investigative efforts in the northern New Mexico area. Additionally,
    the Albuquerque Division's assistant special agent in charge is the
    Chairman of the New Mexico High Intensity Drug Trafficking Area (HIDTA)
    Executive Board.
        During February 2001, the Albuquerque Division of the FBI, in
    conjunction DEA and LEAs, culminated the first phase of a 16-month drug
    investigation with the arrest of 25 federal subjects and 35 state
    subjects, who were the primary source of the organization transshipping
    cocaine from Mexico and California to distribution organizations in
    northern New Mexico and California. The organization was transshipping
    cocaine from Mexico and California to distribution organizations in
    northern New Mexico and other area of California. The organization was
    also associated with 2 drug trafficking organizations on the FBI's
    National Priority Target List.
        Question. An equally serious problem is methamphetamine trafficking
    and usage. I believe both the FBI and DEA have encountered this illegal
    activity in its law enforcement activities in New Mexico, including
    northern New Mexico.
        Would you please give the subcommittee your assessment of the
    effect these joint law enforcement operations in northern New Mexico
    have had on methamphetamine trafficking in the area?
        Answer. Traditionally, northern New Mexico's primary illegal drug
    threat has been the transshipment and distribution of cocaine, black
    tar heroin and marijuana. In recent years, however, the manufacture,
    transshipment and distribution of methamphetamine have developed into
    significant problems in New Mexico. The FBI crime survey and the New
    Mexico High Intensity Drug Trafficking Area (HIDTA) Threat Assessment
    have identified methamphetamine as a sizeable drug problem throughout
    the state. The drug trafficking threat in northern New Mexico is
    largely a result of the new trafficking patterns and local distribution
    networks. Mexican drug trafficking organizations smuggle bulk
    quantities of methamphetamine into the state from laboratories in
    Mexico and California. Law enforcement agencies (LEAs) have also
    discovered an increased number of methamphetamine laboratories being
    operated within the state.
        To address the growing drug problem within the existing complement
    of resources, the FBI has pursued a Task Force strategy throughout the
    state and is participating in the following task forces: Southern New
    Mexico Violent Gang Task Force; the FBI-led Central New Mexico Violent
    Gang Task Force; the Otero County HIDTA Task Force; the Lee County
    HIDTA Task Force; and the Santa Fe/Rio Arriba HIDTA Task Force. The
    Task Forces are composed of state, local and federal LEAs in northern
    New Mexico and enable all participating LEAs to maximize their
    investigative efforts.
        The LEA joint efforts resulted in the seizure of 48 methamphetamine
    laboratories during fiscal year 2000 and 18 methamphetamine
    laboratories during fiscal year 2001. Two of the laboratories seized
    were classified as ``super-labs,'' capable of producing more than 10-
    pounds of the drug per production run. Also, during fiscal year 1999
    and fiscal year 2000, the Albuquerque Division participated in 12
    Organized Crime Drug Enforcement Task Force cases. Methamphetmine
    distribution organizations operating in the northern New Mexico area
    will continue to be identified and dismantled by joint LEA efforts.
        Several other methamphetamine investigations have resulted from
    interdiction seizures on airplanes, trains, buses, and New Mexico
    highways. Over 15 kilograms of methamphetamine have been seized since
    October 1, 2000. Additionally, one seizure from a semi tractor-trailer
    near Gallup, New Mexico resulted in the seizure of over 363 pounds of a
    combined load of methamphetamine and cocaine. Analysis is proceeding to
    determine exactly what percentage of the load was methamphetamine and/
    or cocaine. The driver of the tractor-trailer, a Mexican National
    resided in Calexico, California and has admitted to driving three prior
    loads of narcotics for the organization; however, he was uncertain what
    drugs and what quantities had been in these prior loads.
        Six investigations conducted by Albuquerque DEA in fiscal year 2001
    have focused on methamphetamine trafficking groups operating within New
    Mexico. These investigations deal primarily with individuals or small
    groups of individuals who distribute from 1 gram to 1 ounce of
    methamphetamine. Areas involved in these investigations have included
    the cities of Albuquerque, Clovis, Grants, and Farmington. The most
    significant of these investigations was a seven-pound buy/bust
    operation in Farmington, New Mexico. The eventual target of this
    investigation was, at the time of his arrest, also under investigation
    as a primary heroin source of supply in Albuquerque, New Mexico.
        Intelligence information obtained from the above detailed
    investigations indicates the following:
      --While the majority of methamphetamine distributed in northern New
            Mexico is Mexican produced and distributed, the majority of
            resources and efforts are directed at the numerous small
            clandestine methamphetamine production laboratories. Because
            they pose such significant environmental and safety hazards and
            because they continue to increase in numbers, these clandestine
            manufacturing laboratories will continue to be a priority for
            Albuquerque DEA.
      --Cooperative local impact investigations disrupt the availability
            and distribution of methamphetamine in northern New Mexico
            communities for a brief time; however, the continued
            availability of Mexican produced methamphetamine allows these
            distribution markets to recover within a few months.
      --As with all other illegal narcotics, the primary methamphetamine
            trafficking problem in New Mexico is the transshipment of
            multi-pound/multi-kilogram quantities of methamphetamine
            through New Mexico destined for distribution markets in the
            east. Follow-up investigations on interdiction seizures are
            perhaps the most significant investigations currently conducted
            by the Albuquerque District Office. These investigations will
            significantly impact the distribution of methamphetamine in New
            Mexico and also will help to dismantle/disrupt Mexican-based
            distribution networks located in Arizona, California and Mexico
            that are distributing methamphetamine throughout the United
            States.
      --While the user and distribution base for methamphetamine in New
            Mexico is increasing, cocaine and heroin remain the ``drugs of
            choice'' in New Mexico. The majority of the investigative
            efforts of the DEA Albuquerque District Office are directed
            against these two drugs.
                 fbi development of domestic terrorism division
        Question. The Federal Bureau of Investigation has separated the
    functions of counterintelligence and antiterrorism, placing each under
    an assistant director who would first report to the Bureau's deputy
    director and then to the Director. However, it is still unclear what
    constitutes domestic terrorism. This permits the Bureau to now enter
    into any case, no matter how small, and in practical terms means that
    hundreds of agents can now enter into any number of crime scenes that
    once belonged to a variety of agencies. Worse, this could create
    circumstances in which the Bureau's agents, in the name of counter-
    domestic terrorism, poke into the activities of any organization deemed
    subversive, no matter how innocuous it really was.
        What constitutes the Bureau's definition of domestic terrorism? Has
    the Bureau established clear guidelines about the decision made to
    enter into a case it has deemed one of domestic terrorism?
        Background: The development of terrorism as a major threat and the
    need to meet it with increased funding and personnel has provided a
    solid budgetary base for the Bureau that promises to continue
    developing. While it is reasonable to consider such incidents as
    Oklahoma City and the 1996 Atlanta Oylmpic games as domestic-terrorism,
    the Bureau has used this rationale to take over the investigations of
    scores of crimes that are just that--crimes--with no hint of a greater
    plot for domestic violence. Meanwhile, the Bureau's failure with
    respect to the Investigation of Chinese spying on the nation's nuclear
    labs or its insistence--despite significant evidence to the contrary--
    that TWA Flight 800 was a terrorist incident rather than a mechanical
    failure, gives pause to the idea that we should continue to endorse the
    Bureau's expansion of the Division, or even its reorganization into
    ``spy-catching and domestic terrorism'' functions. As Dan Thomasson
    wrote in the Washington Times: ``The concern in law enforcement . . .
    is that a large number of agents now will have nothing more to do than
    to seek out potential terrorism and deal with it no matter under whose
    bed they believe they have found it.''
        The FBI must provide parameters to define the problem and
    appropriate actions; otherwise, permitting the Bureau to justify
    anything it does under the guise of preventing it is too sweeping a
    concession of power.
        Answer. The FBI categorizes terrorism as either domestic or
    international, depending on the origin, base, and objectives of the
    terrorist organization. In this context, domestic terrorism is the
    unlawful use, or threatened use, of force or violence by a group or
    individual based and operating entirely within the United States or its
    territories without foreign direction and whose acts are directed at
    elements of the United States Government or its population, in the
    furtherance of political or social goals. The FBI has entered into
    agreements with other agencies clearly defining the role of the FBI in
    exercising its primacy over terrorism matters. The FBI only operates
    within the confines of those agreements and pursuant to clear statutory
    authorities. A discussion of these authorities is set forth below.
        Effective March 1, 1973, jurisdictional guidelines were adopted by
    the Attorney General (with the concurrence of the Postal Inspection
    Service and the Department of the Treasury) and published in the United
    States Attorneys Bulletin on April 13, 1973, governing investigations
    of violations of the federal explosives control statute found in Title
    18, Sections 841-848. These guidelines clarified jurisdiction for the
    FBI, the Bureau of Alcohol, Tobacco and Firearms, and the Postal
    Inspection Service. The guidelines state that the FBI will exercise
    primary jurisdiction over all Section 844 violations perpetrated by
    terrorist/revolutionary groups or individuals unless otherwise directed
    by the Department of Justice.\1\
    ---------------------------------------------------------------------------
        \1\ The 1973 guidelines may also be consulted in order to determine
    which investigative agency has primary jurisdiction to investigate
    explosives violations not involving a terrorism nexus. For example, the
    investigative agency having jurisdiction over the underlying felony is
    assigned primary jurisdiction over Section 844(h) violations (use/
    carrying of explosives in commission of a felony).
    ---------------------------------------------------------------------------
        In addition, pursuant to Title 28, Section 533, the Attorney
    General ``may appoint officials to detect and prosecute crimes against
    the United States.'' This statute confers on the Attorney General broad
    general investigative authority with respect to federal criminal
    offenses.
        The Attorney General has delegated investigative authority to the
    FBI for all crimes not specifically assigned (through statute or
    otherwise) by Congress to another agency. This delegation was
    officially published under Title 28, Subpart P, Section 0.85 of the
    Code of Federal Regulations, which also provides in paragraph (l) that
    the FBI should ``exercise lead agency responsibilities in investigating
    all crimes for which it has primary or concurrent jurisdiction and
    which involve terrorist activities or acts in preparation of terrorist
    activities within the statutory jurisdiction of the United States.
    Within the United States, this would include the collection,
    coordination, analysis, management and dissemination of intelligence
    and criminal information as appropriate. If another federal agency
    identifies an individual who is engaged in terrorist activities or in
    acts in preparation of terrorist activities, that agency is requested
    to promptly notify the FBI.''
        Furthermore, Presidential Decision Directive (PDD) 39, dated June
    21, 1995, sets forth the United States policy on counterterrorism and
    outlines the FBI's jurisdictional responsibilities in relation to
    terrorism. This PDD built upon previous directives for combating
    terrorism, further elaborated a strategy and an interagency
    coordination mechanism and management structure to be undertaken by the
    Federal Government to combat both domestic and international terrorism
    in all its forms. The FBI was appointed the lead federal agency for
    both investigations and crisis or operational management of terrorist
    incidents. Based on the above sources, the FBI may exercise lead agency
    authority over any federal violation if there is a terrorism nexus. It
    should be noted that the FBI does not always have absolute knowledge
    that a criminal act is one committed by a terrorist. In those instances
    where it is known, or reasonably presumed (by the nature of the act or
    target) to be a terrorist act, the FBI should exercise its lead agency
    authority in order to maintain investigative control over the incident
    so that evidence may be preserved and investigative leads may be
    pursued. In those instances where the FBI does not know the motivation
    for the crime, it has authority to work concurrently with other
    agencies to pursue leads and maintain evidence control until a clear
    terrorism nexus is found. If the incident involves only ordinary
    criminal activity, the FBI defers to the agency which has primary
    jurisdiction.
        In connection with the execution of investigative activities,
    guidelines exist to govern decisions to initiate investigations of
    domestic terrorists and to manage crisis incidents involving terrorist
    attacks. Some of these investigations necessitate and require
    coordination with other government agencies. The FBI is proud of the
    cooperative working relationships established with local, state and
    other federal agencies to ensure effective investigation of terrorist
    activities and appropriate crisis management. Such is demonstrated by
    the thirty Joint Terrorism Task Forces (JTTFs) initiated by the FBI
    throughout the United States. These JTTFs consist of local, state, and
    other federal law enforcement personnel working cooperatively with FBI
    special agents.
        Some of the guidelines and agreements governing investigation of
    domestic terrorist activities and management of crisis incidents
    include the following:
        (1) The Attorney General's Guidelines on General Crimes,
    Racketeering Enterprise and Domestic Security/Terrorism Investigations;
        (2) Advice to FBI Field Offices Regarding Domestic Security/
    Terrorism Investigations and Preliminary Inquires Under the Attorney
    General's Guidelines on General Crimes, Racketeering Enterprise and
    Domestic Security/Terrorism Investigations;
        (3) Manual of Investigative Operations and Guidelines, Part I,
    Sections 100, 266 and 279;
        (4) PDD/NSC-39, U.S. Policy on Counterterrorism;
        (5) PDD/NSC-62, Protection Against Unconventional Threats to the
    Homeland and Americans Overseas;
        (6) PDD/NSC-63, Critical Infrastructure Protection;
        (7) Weapons of Mass Destruction (WMD) Incident Contingency Plan;
        (8) United States Government Interagency Domestic Terrorism Concept
    of Operations Plan (CONPLAN);
        (9) Federal Response Plan;
        (10) Guidelines for the Mobilization, Deployment, and Employment of
    U.S. Government Agencies in Response to a Domestic Threat or Incident
    of Terrorism in Accordance with PDD-39; and
        (11) Title 28, Code of Federal Regulations, Subpart P, Section
    0.85.
        Specifically, the Attorney General's Guidelines on General Crimes,
    Racketeering Enterprise and Domestic Security/Terrorism Investigations
    serve as a means to ensure that FBI investigations are performed with
    care to protect individual rights and confined to matters of legitimate
    law enforcement interest. These guidelines provide guidance for all
    investigations by the FBI of crimes and crime-related activities,
    except investigations involving foreign counterintelligence and
    international terrorism matters. Furthermore, all investigations
    undertaken pursuant to the Attorney General's Guidelines on General
    Crimes, Racketeering Enterprise and Domestic Security/Terrorism
    Investigations are conducted to ensure appropriate application of
    privacy laws.
                                     ______

             Questions Submitted by Senator Ben Nighthorse Campbell
                              international crime
        Question. What types of international crime are of principal
    concern to the FBI, and what is the basis for that concern?
        Answer. The types of international criminal activities that are of
    principal concern to the FBI are committed by those international
    criminal enterprises that pose the greatest threat to Americans and
    their communities, United States businesses and financial institutions,
    and global security and stability. The violations committed by these
    criminal enterprises that fall under FBI jurisdiction include drug
    trafficking, alien smuggling, trafficking in women and children, crimes
    against children, arms trafficking, trafficking in precious gems, non-
    drug contraband smuggling, intellectual property rights violations,
    financial fraud and money laundering, international art theft, and
    parental kidnaping.
        The International Crime Threat Assessment is one of many resources
    upon which the FBI relies to develop its response to international
    crime. Through these threat assessments, field office crime surveys and
    liaison with foreign police organizations, the FBI has identified those
    international criminal enterprises that pose the greatest threat to
    Americans and their communities, United States businesses and financial
    institutions, and global security and stability.
        Question. What new steps will the FBI take to improve the Federal
    Government's response to international crime?
        Answer. To improve the Federal Government's response to
    international crime, the FBI will continue to provide leadership and
    implement international crime control initiatives such as:
        Budapest Project.--The FBI/Hungarian National Police Task Force has
    been established in Budapest, Hungary to identify emerging Eurasian
    criminal enterprise threats to the United States and to disrupt those
    enterprises before they can become entrenched in the United States.
        Linchpin Initiative.--Operation Linchpin was established to
    facilitate the sharing of information and operational leads, both
    domestic and foreign, between the law enforcement and intelligence
    communities. Linchpin focuses on significant international criminal
    groups (e.g., Eurasian, Italian, and Asian organized crime). Several
    law enforcement and intelligence agencies, including the FBI, are
    involved in sharing intelligence at regularly scheduled Linchpin
    meetings.
        Project Millennium.--The FBI, along with law enforcement agencies
    from 23 countries, has provided INTERPOL with the names and profiles of
    thousands of Eurasian organized crime subjects in order to establish a
    worldwide database that would allow participating countries to cross-
    reference and coordinate leads involving Russian and Eastern European
    organized crime members.
        United States-Mexico Fugitive Initiative.--An initiative with the
    FBI, the Department of Justice (DOJ) and the Mexican Government,
    designed to improve procedures for obtaining provisional arrest
    warrants for fugitives that have fled to the United States from Mexico.
        United States-Canada International Fugitive Initiative--The DOJ,
    FBI, United States Marshals Service, Royal Canadian Mounted Police
    (RCMP), Toronto Police Service, and Immigration and Naturalization
    Service exchange intelligence and improve efficiency in locating/
    apprehending fugitives who flee to the United States from Canada and to
    Canada from the United States.
        Canadian Eagle.--This joint initiative between Canadian law
    enforcement agencies and the FBI targets unscrupulous Canadian
    telemarketers victimizing United States citizens, particularly the
    elderly. The FBI is working with the RCMP and other police agencies to
    identify, investigate, and prosecute these individuals.
        The International Securities and Commodities Working Group.--This
    group was established to bring together individuals dealing in
    international markets, primarily through FBI Legal Attaches and their
    counterparts, to discuss ways to effectively coordinate investigations
    relative to United States and international financial markets.
        Plan Colombia.--DOJ and the FBI are assisting Colombia in
    developing a comprehensive program to investigate kidnapings. This
    program will include the establishment of a Colombian law enforcement
    task force consisting of specially trained investigators. Where
    appropriate, the task force will work closely with the FBI,
    particularly in cases involving United States nationals. The FBI is
    implementing a comprehensive training initiative designed to train law
    enforcement and military personnel from Colombia in anti-kidnaping
    investigative methods and procedures.
        The High Intensity Financial Crimes Area (HIFCA).--This program is
    a Congressionally mandated approach to addressing complex and egregious
    money laundering conspiracies in a task force environment. The
    designation of HIFCA is intended to concentrate law enforcement efforts
    at the federal, state, and local levels to identify, target, and
    prosecute money laundering activity. Due to the international nature of
    most money laundering crimes, HIFCA efforts to address money laundering
    domestically will have an impact on international money laundering
    conspiracies. HIFCAs have been established in the New York/Newark, Los
    Angeles, San Juan, Phoenix, El Paso, and San Antonio Divisions.
    Applications for similar designations have been made by the San
    Francisco and Chicago Divisions.
        INTERPOL Project Rockers.--With respect to Outlaw Motorcycle Gangs
    the FBI participates in the INTERPOL Project Rockers annual conference
    and takes part in the Project Rockers Steering Committee.
    Representatives from Europe, Australia, and Canada also participate.
    The goals of the meetings center on efforts to evaluate and strengthen
    the international cooperation between the countries that are affected
    by criminal activities engaged in by Outlaw Motorcycle Gangs and its
    members.
        Project Stocar.--This joint initiative between the FBI and INTERPOL
    was implemented to share and exchange data regarding international
    vehicle theft.
        In addition to the above ongoing initiatives, the FBI is working
    with seven European nations to develop an automated system to connect
    existing art theft databases.
        Question. How does the FBI propose to coordinate its response to
    international crime with the efforts of other federal agencies--such as
    the Departments of State and the Treasury--to ensure that the response
    is focused and the potential for bureaucratic overlap is reduced?
        Answer. FBI executive management will continue to provide
    leadership to international crime working groups, and will continue its
    liaison with other federal agencies in this regard. With regard to its
    response to international crime, the FBI maintains effective liaison
    with the Central Intelligence Agency (CIA); Drug Enforcement
    Administration (DEA); United States Customs Service; and the United
    States Department of State.
        The FBI will also continue to detail supervisors to the CIA and DEA
    in order to maintain its close relationship with these federal
    agencies. Further, the FBI will continue to expand its partnership with
    DEA in the Special Operations Division, looking to increase coverage
    beyond the traditional drug trafficking arena into those areas of the
    world currently being dominated by organized crime groups.
        Question. Also, recognizing that considerable law enforcement
    activity to counter international crime occurs in foreign countries,
    how does the State Department propose to coordinate its efforts with
    its foreign counterparts?
        Answer. The FBI cannot speak to the State Department's coordination
    efforts with its foreign counterparts.
                                     ______

                Questions Submitted by Senator Patrick J. Leahy
                           data storage and retrieval
        Question. In a July 1999 report, the Justice Department's Inspector
    General strongly criticized the Federal Bureau of Investigation's
    (FBI's) information management system. He concluded: ``The FBI's
    procedures for culling information for its teletypes and electronic
    communications and inputting it into its databases essentially makes it
    impossible for the FBI to state with confidence that a database search
    has yielded all information in the FBI's files about a particular
    subject.''
        What steps have you taken over the years to update and improve the
    FBI's data storage and retrieval system?
        Answer. Currently, the FBI's Information Technology (IT)
    environment is composed of historic stovepipe systems. The FBI has
    consolidated all systems under the Chief Information Officer, Assistant
    Director Bob E. Dies (rather than maintaining them by individual
    Divisions). The Trilogy upgrade investment plans the initial movement
    to a modem database structure, to enable consolidating investigative
    data into a central ``data warehouse.'' As an interim step, however,
    the FBI has developed a ``global search'' of its five most frequently
    used investigative applications databases to improve the ability to
    find data it already has (spread across numerous systems).
        Since the initial deployment of Automated Case Support (ACS), the
    FBI has made many software updates and enhancements to increase the
    efficiency and effectiveness of the system. The Manual of
    Administrative Operations, which sets forth FBI policy on records
    management, has been updated to include policy on these enhancements of
    ACS.
        The serialization (attributes only) of Top Secret/SCI documents was
    incorporated into ACS in September 1997 (and reiterated in February
    2000,) thereby increasing the accountability of all documents related
    to a specific case.
        Beginning in the latter half of 1998, the FBI began uploading into
    ACS all teletypes received from other government agencies into a
    control file. The uploading of these teletypes provides full-text
    retrieval for the yearly receipt of over 300,000 messages. A technical
    design and implementation plan is in place to transition the current
    semi-automated and manual processing of these teletypes to more direct,
    secure, audited, and automated methods by the second quarter of fiscal
    year 2002. The planned implementation will transition the current
    system from manual profiling to automated profiling, and from paper
    delivery to direct delivery of teletypes to an authorized FBI user's
    desktop. This system will also automatically upload these teletypes
    into the existing ``control file,'' which will allow full-text
    retrieval, but with added security functions to protect the integrity
    and access to the data and information, and provide the appropriate
    accountability, identification, and authentication of users.
        The FBI is continuing to improve its data storage and retrieval
    systems.
        Question. Does the Federal Bureau of Investigation have adequate
    resources in its fiscal year 2002 budget request to correct the
    problem?
        Answer. Today's record storage (as exemplified in the Oklahoma City
    Bombing case recently) is paper intensive and subject to manual error.
    The FBI is currently standing down in July to reinforce procedures that
    have been in place, but not always followed, in its Records Management
    System. As an immediate step, the FBI is planning a document tracking
    addition to its Trilogy program, which will not require additional
    funding. However, the long-term solution to the FBI's records
    management problem requires database management systems (Trilogy) in
    addition to the use of ``electronic signatures'' to avoid the need for
    paper transfers and reduce the chance of manual errors. The FBI is
    currently assessing the resource requirements for these improvements.
        Question. When did you first learn that the Federal Bureau of
    Investigation (FBI) had withheld evidence from prosecutors in the
    Birmingham church bombing case? Why did the FBI wait as long to hand
    over everything it had?
        Answer. The FBI's original investigation into this matter was
    initiated in September 1963 and was actively pursued for more than 5
    years. This investigation consisted of thousands of interviews,
    extensive evidence examination and a variety of other investigative
    techniques. The original investigation, which utilized hundreds of
    agents throughout the United States, resulted in approximately 90
    volumes of material in Birmingham (consisting of tens of thousands of
    pages). In addition to the Birmingham file, there were auxiliary office
    files opened in each of the FBI's other field offices and at FBI
    headquarters. In 1968, the active phase of the FBI investigation ended
    and, in 1972, the case was formally closed for lack of a prosecutable
    federal violation.
        In response to a request from the Alabama Attorney General's office
    in 1977, the FBI made the Sixteenth Street Baptist Church Bombing case
    file available to an investigator from that office, Mr. Robert Eddy,
    for the purpose of establishing a basis for state prosecution. The
    entire file was provided with the exception of specific informant
    files, to include voice recordings of conversations involving an
    informant and one of the primary suspects, Thomas Blanton. Under an
    agreement with the Alabama Attorney General, case file information that
    would reveal the identities of FBI informants--many of whom were still
    in danger--was not to be disclosed. This understanding was--and still
    is--consistent with federal law and policy that enables federal law
    enforcement agencies to protect their informants.
        While the voice recordings were not provided to Mr. Eddy, summaries
    of information derived from some of the tapes were included in the
    files made available. The tape recordings fell into two distinct
    categories: body recordings made by an FBI informant of conversations
    with Thomas Blanton; and recordings made through a microphone, or
    ``bug'' placed in the wall adjoining Mr. Blanton's kitchen, which
    became known as the ``kitchen tapes.'' It is unclear from our review of
    the file to date, or from recent contact with Mr. Eddy, whether or not
    he was aware of the existence of any tape recordings in this matter.
    Summaries of information derived from the informant tape recordings
    were included in the files that were made available to Mr. Eddy.
    Although the file did not contain summaries of the ``kitchen tapes,''
    there were references within the file regarding information obtained
    from the kitchen tapes.
        Mr. Eddy was provided FBI office space and an agent was assigned to
    facilitate his review of the case file. Mr. Eddy was also provided
    access to case agents, including those who had retired or had
    transferred to other field offices. Mr. Eddy's review took
    approximately 6 months, during which time he had access to 90 volumes
    of material.
        In response to concerns expressed by various civic leaders, the
    special agent in charge of the FBI Birmingham office reopened the
    investigation in 1995 on his own initiative. During the ensuing case
    file review by FBI personnel, the presence of the tape recordings was
    discovered. All tapes were subsequently released to the United States
    Attorney for the northern District of Alabama, who ultimately used them
    in the 2001 state prosecution of Mr. Blanton.
        There is no indication that the ``kitchen tapes'' provided to the
    United States Attorney in 1995 were intentionally withheld from Mr.
    Eddy. With hindsight, some explanations for the reasons the tapes were
    not discovered by Mr. Eddy are more probable than others. With respect
    to the ``kitchen tapes,'' the technique of recording conversations
    without the consent of either party, although not prohibited by law at
    that time and authorized by FBI Director Hoover, pursuant to Department
    of Justice policy in existence at the time, was considered highly
    sensitive. For this reason, information obtained through this technique
    was not clearly documented as being attributable to a ``bug.''
        Second, it was the general policy of the FBI to use non-consensual
    tape recordings for criminal intelligence and internal security
    purposes, and they were not commonly viewed as evidence in the
    traditional prosecutive sense. Therefore, they were typically kept
    apart from witness interviews and other information of a clearly
    evidentiary nature. In 1967, the United States Supreme Court made clear
    in Katz v. United States that the non-consensual interception of
    private communication constituted a ``search'' under the Fourth
    Amendment and therefore, required the same constitutional protection as
    physical searches. Congress followed in 1968 with the Federal Wiretap
    Act, which established fixed procedural requirements to record private
    conversations and admit them into evidence in a criminal trial. This
    was 4 years after the tapes were made.
        Third, Mr. Eddy's review occurred 13 years after the tapes were
    made and 9 years after active FBI investigation ceased. While Mr. Eddy
    had access to and interviewed agents who were familiar with the
    original investigation, it appears that the existence of the tapes was
    never discussed. Finally, summaries of the informant tapes and
    references to information derived from the ``kitchen tapes'' were
    contained in files made available to Mr. Eddy; however, the primary
    focus of his investigation was Robert Chambliss, not Thomas Blanton.
    This focus on Chambliss, combined with the limited time period he was
    given to complete his review and investigation were likely factors in
    Mr. Eddy's not discovering the existence of either the ``kitchen
    tapes'' or the informant tapes.
        Question. What steps have you taken to determine whether the FBI
    has been sitting on evidence in other cases and to ensure that it does
    not happen again?
        Answer. As explained above, the belated discovery of the tape
    recordings in the Birmingham case was not the result of the FBI
    ``sitting on,'' or hiding evidence. With respect to other FBI
    investigations involving civil rights violations, the FBI has received
    no indication from any source--including federal prosecutors, the
    defense bar, judicial rulings, and its own internal inspection
    process--that there exists a practice of withholding evidence or of
    failing to adhere to criminal discovery requirements in any other
    manner.
        FBI agents are throughly trained in the rules of discovery,
    including their legal obligations to adhere to those rules, beginning
    with new agent training. This training continues on a regular basis
    throughout a field agent's career in all FBI field offices and is
    continuously reinforced in practice through guidance from federal
    prosecutors and FBI field supervisors. Finally, the handling of
    evidence in a manner that both preserves its integrity and efficiently
    serves the discovery process is a significant part of the thorough
    inspection that each FBI field office receives every 3 years. Our
    inspection process mandates, for example, that the Chief Judge of that
    District be interviewed about the FBI's role in the District's federal
    criminal prosecutions. Other mandatory interviews include the local
    United States Attorney and members of his/her staff. These interviews
    are designed to elicit feedback about the FBI's performance in ongoing
    federal prosecutions and serve as the basis for recommendations for
    policy changes.
                                ``hanssen'' case
        Question. With respect to the Hanssen case, the question on
    everyone's mind is how the alleged espionage could go on uninterrupted
    for 15 years without being detected. Until recently, the Federal Bureau
    of Investigation (FBI), unlike other national security agencies like
    the Central Intelligence Agency and the Department of Energy, did not
    routinely polygraph its employees who had access to classified
    information, even though some experts recommended that such screening
    be done. What were the reasons for the FBI's policy against using
    polygraph examinations?
        Answer. The FBI has had a limited polygraph program in place since
    1978. The polygraph program was established in 1978 for on-board
    investigators on a case-by-case-basis. In 1983, the FBI expanded the
    program to include employees who had a need for special access. This
    included counterintelligence focused polygraph examinations for
    personnel with access to selected, highly sensitive information. A
    threshold was established to determine who qualifies on a case-by-case
    basis for the special access polygraph exams. In December 1992, the
    FBI's polygraph program was updated to incorporate a requirement for
    contract employees who have access to sensitive information and/or are
    assigned to select locations. This included contract linguists, select
    task force personnel, and other contractors on a case-by-case-basis
    depending on their job requirements. In March 1994, a comprehensive
    polygraph examination program was established for all FBI applicants.
    Furthermore, in June 1994, issue-based polygraph examinations began in
    security adjudication and other personnel administrative inquiries.
        Between 1994 and 1996, serious consideration was given to
    instituting routine polygraph examinations of on-board employees.
    However, the FBI did not adopt a mandatory polygraph program due to
    differing views on effectiveness and the significant impact resulting
    from false positives.
        The FBI will be glad to provide you a briefing on this issue at
    your convenience.
        Question. Do you believe that if the Federal Bureau of
    Investigation had been conducting routine polygraph screening,
    Hanssen's alleged espionage would have been detected sooner?''
        Answer. Due to the sensitive nature of Mr. Hanssen's assignments
    within the FBI, had the FBI's current interim polygraph program, which
    was initiated subsequent to his arrest and is described in the response
    to the next question, been in place earlier, he would have been tested.
    It can only be speculated as to whether such a test, if administered to
    Hanssen, would have led to earlier detection of his alleged espionage.
        Question. According to press reports, in the wake of Hanssen's
    arrest, the Federal Bureau of Investigation decided to give polygraph
    examinations to 500 of its employees who have access to intelligence
    information. Why was this kind of testing appropriate after Hanssen's
    arrest but not before?
        Answer. As a result of the Hanssen case, the FBI has been caused to
    rethink the issue of security with regard to the ``trusted insider.''
    Polygraph examinations of on-board employees are merely one of the
    tools which will be used in the personnel security reinvestigation
    processing of existing employees.
        Question. The Judiciary Committee recently held a hearing on
    ``Issues Surrounding Use of the Polygraph.'' All of the expert witness
    [es] we heard (both pro- and anti-polygraph) agreed that polygraph
    screening will produce a certain percentage of ``false positive''
    responses, that is, where an innocent person's reactions falsely show
    deception on the polygraph. According to a recent public statement by
    Attorney General Ashcroft, polygraph screening has a false-positive
    rate of about 15 percent. If we accept that figure, that means that if
    you administer polygraphs to 500 people, approximately 75 people will
    have false positive polygraph results. What is the Federal Bureau of
    Investigation doing to protect the rights of those employees who may
    have false positive polygraph test results?
        Answer. The population being tested is very selective, and the
    polygraph questions being asked are very focused, resulting in an
    anticipated false positive rate significantly lower than 15 percent.
    Further, independent of the exact rate of false positives, the Federal
    Bureau of Investigation has established a process to ensure that
    negative polygraph results are carefully investigated. Adverse actions
    against employees will not be taken based solely on the results of a
    polygraph examination. Rather, information developed as the result of
    investigative activity taken subsequent to the conduct of the polygraph
    examination will be used to determine if an adverse action is
    appropriate.
        Question. Do you believe that any adverse action should be taken
    against an Federal Bureau of Investigation employee based solely on the
    results of a polygraph examination, in the absence of any corroborating
    evidence that they have done anything wrong or given any deceptive
    answers?
        Answer. In a legal sense, an adverse action under 5 U.S.C. chapter
    75, is a suspension in excess of 14 days up through termination or a
    demotion in grade. The FBI does not believe that such actions should be
    taken against FBI employees based solely on the results of polygraph
    examinations. Having said this, however, it must be readily apparent
    that federal agencies are obligated to take all reasonable and prudent
    actions to protect the interests which they represent. Therefore,
    though the FBI will take no adverse actions against FBI employees based
    solely on the results of polygraph examinations, it may, as necessary,
    temporarily transfer persons to positions with less sensitive access,
    at no loss of pay, during the pendency of investigations pursuant to
    polygraph examinations.
                                     ______

           Questions Submitted to the Drug Enforcement Administration
                Questions Submitted by Senator Pete V. Domenici
                      linking dea's budget to performance
        Question. The DEA has benefited in recent years from publicity
    attendant to a series of ``largest seizure in history'' busts.
    According to Nexis, in the past year newspapers have reported 66 of
    these ``biggest busts'' in history whether by state or type of drug or
    whatever.
        Biggest bust stories suggest that we are now winning the war on
    drugs. While it is true that more drugs are interdicted, for example
    cocaine seizures rose from 9,000 kilos in 1983 to 108,000 in 1997, one
    might wonder whether, in fact, more drugs are crossing our borders.
    Street prices for cocaine and heroin are holding constant or even
    falling which also suggests that plenty of these drugs are still
    crossing the borders.
        Americans seem willing to pay for illegal drugs and, no matter how
    many biggest busts in history are accomplished, replacement smugglers
    and dealers, even replacement countries, are ready to step in to take
    the place of those arrested.
        What is the DEA's intention with respect to balancing a focus on
    supply with a focus on demand reduction?
        Answer. Drug law enforcement is the primary focus of the DEA as
    expressed in the agency's mission statement: ``To enforce the
    controlled substances laws and regulations of the United States and
    bring to the criminal and civil justice system, those organizations and
    principal members of organizations involved in the growing,
    manufacturing, or distribution of controlled substances appearing in or
    destined for illicit drug traffic in the United States; and to
    recommend and support non-enforcement programs aimed at reducing the
    availability of illicit controlled substances on domestic and
    international markets.''
        Because DEA's mandate is primarily supply reduction, the agency
    will continue to focus its resources, financial and human, toward this
    supply focused mission responsibility.
        However, without detracting significant financial and human
    resources from the mission to focus on supply reduction, DEA attempts
    to bring balance to the agency's approach by providing demand reduction
    activities both in the field and at the headquarters level.
        Established in 1986, DEA's Demand Reduction Section (CPD) provides
    information to the public including youth, community groups, educators,
    law enforcement organizations and businesses about drug prevention and
    the dangers of drugs. This is accomplished through the efforts of the
    agency's 22 field Demand Reduction Coordinators (DRC) and headquarters
    support staff. The staff closely coordinates training programs,
    seminars and other prevention-related activities with federal, state,
    and local drug prevention agencies and organizations nationwide,
    providing training and technical assistance to audiences around the
    country. In total, the Demand Reduction program represents less than
    one percent of the agency's annual budget appropriation.
        DEA's Demand Reduction program has four national priorities. These
    priorities include: mobilization of communities and public awareness;
    education of youth; education of parents; and drug free workplaces.
    Stemming from these priorities are numerous initiatives to increase
    awareness about drugs and provide organizations with advice and the
    tools they need to succeed. They include:
      --MET II /``Cutting Edge'' Training.--DEA has Mobile Enforcement
            Teams (METs) that, at the invitation of a community's police
            chief, sheriff, or prosecutor, discretely work in a community
            for several months to eliminate targeted violent drug-
            trafficking organizations impacting the community. After the
            MET team completes its work, DEA sends a team of five leaders
            from that community to a three-day training session to learn
            how to develop and operate a community coalition and develop
            and implement a drug-and-crime-prevention plan. This training
            is called ``MET II'' and it incorporates the ``Cutting Edge''
            crime prevention and community mobilization curriculum widely
            used in crime prevention. The Department of Justice and DEA pay
            for the training, so there is no cost to the participants.
            DEA's goal is to offer the training to every community that has
            hosted a MET deployment. To date, DEA has hosted 5 training
            sessions for 394 leaders in 87 communities across the United
            States DEA is in the process of surveying these communities to
            see how they are using what they learned in the training.
      --Teens in Prevention (TiP).--TiP is a network of youth-driven,
            community-supported, school-based organizations. The goal of
            this network is to increase the number and effectiveness of
            young people, adults, and community organizations involved in
            drug and violence prevention. With a focus on individual
            responsibility and positive peer pressure, TiP is based on the
            idea that teens hear information coming from adults as
            lectures, but they hear information coming from their peers as
            gospel. TiP was launched in El Paso, Texas, in 1998 and now
            over 5,000 teens belong to TiP groups in Texas as well as in
            New Mexico and Colorado.
      --Youth Leadership Conferences.--Keeping in mind the impact that
            youths have on other youth, DEA holds these conferences around
            the country. The purpose of this week-long event is to promote
            leadership skills and education about prevention issues.
            Conferences have been held in San Antonio, Texas as well as in
            Milton, Florida (at a Naval Air Station), and at the Pensacola
            Naval Air Station in Pensacola, Florida. To date, over 100
            youth leaders have attended these sessions.
      --Law Enforcement Explorers.--Throughout the United States, DEA DRCs
            are working with Boy Scouts and Law Enforcement Explorers. In
            some cases, DEA sponsors the Explorer post. DRCs provide
            training in the area of narcotic enforcement, community
            involvement, and general drug abuse issues for Explorers. The
            CPD always participates in the Boy Scout Jamboree every 4
            years, as well as the biennial Law Enforcement Explorer
            Conference and Explorer Leadership Training sessions held at
            both the DEA and FBI Academies during the summer.
      --Drug Free Workplace Training.--Most DRCs are conducting this
            training on a routine basis. While most large corporations have
            adopted Drug Free Workplace policies, small businesses are
            still in need of training. DRCs can provide this training,
            helping to develop policy for the company, implement Department
            of Transportation regulations, and assist in providing updates
            on the drug abuse situation in any particular community.
      --Regional Club Drug Conferences.--Following an International Club
            Drug Conference in July, 2000, CPD planned Regional Club Drug
            Conferences in a number of cities in the United States. The
            first conference was recently held in Atlantic City, New Jersey
            and was attended by approximately 250 participants from the law
            enforcement, treatment and prevention communities. Two other
            conferences are planned for fiscal year 2001 in San Diego and
            Chicago. The focus of these conferences is to provide
            information on the dangers of club drugs and work to find
            solutions for dealing with the problem. Evaluations of the
            first conference were outstanding. Additional Regional
            Conferences are planned for fiscal year 2002 throughout the
            United States.
        In addition to these programs, there are a variety of demand
    reduction initiatives going on in each of DEA's 22 field divisions
    around the country. Many DRCs provide drug prevention and education
    training for parents, teachers, community leaders and law enforcement.
        It has been and will continue to be the DEA's position that agency
    efforts will be focused primarily on its supply-based mission. However,
    DEA will continue to pursue opportunities to partner with government
    agencies and other organizations with demand-based missions to address
    demand-based issues. Such collaborative efforts will receive DEA
    attention to the fullest extent possible without detracting from the
    agency's given mission.
        Question. Since quantities interdicted seem to produce ever upward
    budgets for the agency, when the seizures may indicate a failure to
    stem the flow of drugs, what should we use as an indicator of success
    in the war on drugs?
        Answer. The perception that seized quantities of illicit substances
    has a causal and proportionate relationship to the size of the DEA's
    budget is unfortunate when there are factors, such as the cost of
    investigative tools and basic agency support functions (i.e., Title III
    support, Firebird), that account for significant portions of the
    agency's recent budget increases.
        The collective seizure trends of the DEA and of the other federal,
    state and local law enforcement entities may or may not indicate
    success in the overall assessment of the United States law enforcement
    community to impact the supply of drugs in the United States. The
    ability to isolate seizure data as an indicator is troublesome at best
    given the other potentially contributing factors such as the
    improvement of data-sharing relationships and investigative techniques
    among agencies. Other externally-based factors may include the per-
    shipment distribution methods employed by traffickers and their
    concealment methods.
        But beyond these difficulties in assessing the relationship, if
    any, between seizure data and success in anti-drug activities by the
    DEA, the most appropriate indicator has very little to do with data
    such as drug quantities seized. The DEA has developed a 5-year
    strategic plan in which more appropriate indicators have been
    introduced. Termed Measures of Effectiveness, DEA sets forth
    Anticipated 5-Year Outcomes in 3 areas: International Impact Targets,
    National Impact Targets, and Local Impact Targets. While DEA includes
    indicators tailored to each area, the indicator common to each
    references the disruption of targeted drug organizations. It is this
    disruption assessment that is the most appropriate indicator to measure
    DEA's success in anti-drug efforts.
        The indicators apply to DEA's contribution to the nation's anti-
    drug efforts. Any more comprehensive assessment must be made a higher
    level and include an assessment of the efforts put forth by all
    agencies with anti-drug functions, whether supply- or demand-based.
                    linking dea's budget to gpra indicators
        Question. According to the 2002 budget, the Administration has
    mandated that agencies use performance-based budgeting on selected
    programs in the fiscal year 2003 budget cycle.
        Under this mandate, agencies will be required to submit
    performance-based budgets for selected programs in the fiscal year 2003
    budget process, the first time agencies have been required to tie their
    spending decisions to performance goals.
        The Department of Justice (DOJ) was among the poorest performers
    under the criteria by which performance plans were reviewed by the GAO
    as well as in the Mercatus evaluation.
        Please tell me what specific steps you see necessary to improve the
    agency's performance plan and how this will be coupled with the
    Department's performance plan in order to fulfill the new mandate.
        Answer. While, it is true that the Justice Department's fiscal year
    2001 Performance Plan received low marks from the Mercatus Center and
    GAO; the evaluation of the combined fiscal year 2000 Performance Report
    and fiscal year 2002 Performance Plan noted significant improvement. In
    the recent ranking by the Mercatus Center, the DOJ moved from 23rd to
    the 5th position. In addition, GAO addressed many of the improvements
    that DOJ made under the section comparing the performance report and
    plan with the previous year's report and plan. In regard to planning
    and reporting of DEA's mission accomplishments, we are continuing our
    efforts to improve performance measurement.
        To accomplish our mission, the DEA developed a Strategic Plan,
    which sets forth the agency's strategic goals and objectives over a 5-
    year time frame. It provides the long range goals and strategies by
    which we will measure our progress and be held accountable. This
    Strategic Plan is key to establishing and maintaining a clear focus on
    the outcome of our efforts in response to the Government Performance
    and Results Act (GPRA) of 1993. The plan builds on the statutory
    mandated mission of the DEA. It provides the framework within which we
    prioritize and allocate our resources and establishes the foundation
    for the development of more detailed annual performance plans, budgets,
    and related program performance information.
        In order to improve the agency's performance plan there must be
    clearly articulated Critical Success Factors set forth in the agency's
    Strategic Plan in measurable terms. In other words, the actual
    performance measures must be set. This is the articulation of how DEA
    will measure its primary indicators, i.e., the disruption or
    dismantlement of targeted drug trafficking organizations. Second, DEA
    must set its performance goals for the assessment period. The
    performance goals will be based on a Priority Target list assembled
    from the field and refined by headquarters. Third, DEA must adopt
    whatever data collection mechanisms necessary to accurately and
    efficiently assemble the measurement. This is likely to include some
    traditional databases measuring operational output, but more
    importantly will include the development of a data system sufficient to
    capture resource data that is connected to the activity on drug
    trafficking organizations contained in the agency's Priority Target
    list.
        This information will feed the Department's performance plan by
    providing meaningful data that can easily be blended with that of other
    DOJ counterparts without relying solely on traditional statistics, such
    as arrests and seizures.
        Question. Do you have preliminary thoughts on which programs will
    be chosen for performance-based budgeting?
        Answer. DEA plans to submit future budget requests in a format that
    is consistent with its Strategic Plan framework. Specifically, funding
    will be tracked by the 4 DEA Strategic Focus Areas: International
    Targets, National/Regional Targets, Local Impact, and Management
    Infrastructure.
        DEA has not yet set in motion a decision process to determine which
    agency programs will receive the benefit of performance-based
    budgeting. Until a comprehensive assessment mechanism is in place, it
    is premature to identify any programs, therefore no preliminary
    selections can be put forth at this time.
                       dea work with amtrak in new mexico
        Question. Although this program ended some 3 weeks ago, for several
    years Amtrak provided federal drug police in Albuquerque with ticketing
    information about passengers. As part of a singular arrangement, a
    computer with access to Amtrak's ticketing information resides in the
    DEA's local office. This computer can provide drug agents with
    information such as passengers' names, origination and destination, and
    whether the passenger paid for their travel with cash or credit as well
    as when the ticket was purchased. Information obtained from Amtrak
    helped drug agents determine which passengers they speak to and whose
    luggage could be checked by a canine as trains roll into Albuquerque.
    Amtrak receives 10 percent of any cash seized from suspected drug
    couriers at the Downtown Albuquerque Station.
        When the article was written, the Albuquerque DEA office indicated
    that, although ``substantial,'' it did not immediately know how many
    arrests had been made or how much cash had been seized. Also, the
    specter of Constitutional concerns, such as ethnic targeting and
    unreasonable searches and seizures, seemed to be arising.
        Please provide me with specific information on the number of
    arrests, cash seized, and all demographics of those arrested including
    such data as origin of travel.
        Answer. Statistics are for October 1, 1999--April 12, 2001
    Demographics of Arrested Subjects:
        White Non-Hispanic Males: 30.2 percent.
        White Hispanic Males: 25.4 percent.
        Black Non-Hispanic Males: 23.8 percent.
        Black Non-Hispanic Females: 6.3 percent.
        White Non-Hispanic Females: 6.3 percent.
        White Hispanic Females: 6.3 percent.
        Other: 1.6 percent.
    Travel Origin Cities:
        Los Angeles, California
        San Bernardino, California
        Fullerton, California
        Flagstaff, Arizona
    Seizures:
        U.S. Currency--$2,427,848.
        Marijuana--470.7 kilograms.
        Cocaine--20.55 kilograms.
        Crack Cocaine--3.25 kilograms.
        Methamphetamine--2 kilograms.
        Heroin--.4 kilograms.
        Ephedrine (Precursor for methamphetamine)--74 kilograms.
        DEA does not utilize racial profiling or employ a national drug
    trafficker profile that our Special Agents invoke in deciding whether
    to approach or investigate a particular individual. Rather, DEA agents
    rely upon their experience and training in determining when to commence
    an investigation. Experience has shown that there are clear patterns of
    activity that some drug traffickers, particularly drug couriers, often
    display. DEA does train its agents and law enforcement personnel from
    other agencies concerning behaviors and activities that experience has
    shown are consistent with drug trafficking. Proactive narcotic law
    enforcement is an effective strategy to protect the public from the
    drug-related crime and violence. Drug enforcement activity based on
    race, national origin or gender is not only ineffective, but it is
    unethical and illegal. Such methods have no place in DEA, or in law
    enforcement in general.
        Question. What is the status of any Constitutional challenges,
    including those based on sharing of private information by federal
    agencies, to this practice? Please provide information concerning the
    numbers of cases in which a Constitutional challenge was raised and the
    disposition.
        Answer. DEA is not aware of any Constitutional challenges regarding
    DEA's access to the AMTRAK reservations systems. Based on our research
    to date, we find no such issues. DEA's access to the AMTRAK
    reservations systems is a matter of public record, and is thoroughly
    reported in the federal case law. AMTRAK also monitors its reservations
    systems for suspicious activity. The core issue here is that the
    information DEA accesses belongs to AMTRAK, not the individual, and the
    Supreme Court has held that an individual does not have an expectation
    of privacy in information he or she has disclosed to a third party.\1\
    If the government's access to information is not prohibited by the
    Fourth Amendment, the only other protection a party might have is
    statutory, such as exists with information maintained by electronic
    communications service providers,\2\ and financial institutions.\3\ But
    we know of no statutes that prohibit the government from obtaining
    train manifests from AMTRAK.
    ---------------------------------------------------------------------------
        \1\ See United States v. Jacobsen, 466 U.S. 109, 118, 104 S. Ct.
    1652, 80 L. Ed. 2d 85 (1984) (``It is well settled that when an
    individual reveals private information to another, he assumes the risk
    that his confidant will reveal that information to the authorities, and
    if that occurs the Fourth Amendment does not prohibit governmental use
    of that information.''); United States v. Miller, 425 U.S. 435, 443, 96
    S. Ct. 1619, 48 L. Ed. 2d 71 (1976) (``This Court has held repeatedly
    that the Fourth Amendment does not prohibit the obtaining of
    information revealed to a third party and conveyed by him to Government
    authorities, even if the information is revealed on the assumption that
    it will be used only for a limited purpose and the confidence placed in
    the third party will not be betrayed.'').
        \2\ See 18 U.S.C. Sec.  2703(c)(1)(A)(2001) (``Except as provided
    in subparagraph (B), a provider of electronic communication service or
    remote computing service may disclose a record or other information
    pertaining to a subscriber to or customer of such service . . . to any
    person other than a governmental entity.'').
        \3\ See 12 U.S.C. Sec.  3402 (``no Government authority may have
    access to or obtain copies of, or the information contained in the
    financial records of any customer from a financial institution'').
    ---------------------------------------------------------------------------
        To date, defendants whose arrests have flowed from DEA's access to
    AMTRAK's reservations records have unsuccessfully raised Equal
    Protection objections based on race,\4\ and unsuccessfully challenged
    the government's ability to use administrative subpoenas to obtain
    passenger information.\5\ Those issues disposed of, our research has
    disclosed no other constitutional issues.
    ---------------------------------------------------------------------------
        \4\ See United States v. Gordon, 173 F.3d at 761-768 (``[The
    defendant] makes much of the fact that the description provided by
    [AMTRAK] referenced his race and from that he reasons the tip was race-
    based. This rampant speculation is not supported by any evidence in the
    record. . . . [The defendant] ignores the evidence that prompted the
    Amtrak employee to contact the DEA in the first place--he had purchased
    a one-way ticket, with cash, only minutes before the train departed.
    The AMTRAK employee contacted the DEA after noting these facts because
    the employee previously had been told by the DEA that these facts fit
    the DEA profile of an individual who is a likely transporter of
    drugs.'').
        \5\ See United States vs. Moffett, 84 F.3d 1291-1293 (10th Circuit
    1996) (defendant lacked standing to challenge Government's use of
    administrative subpoena against AMTRAK).
    ---------------------------------------------------------------------------
        Question. What are your plans to share this information with other
    enforcement agencies?
        Answer. The passenger information contained in the Amtrak database
    was used by members of the Albuquerque District Office's interdiction
    unit working at the train station. An officer with the AMTRAK Police
    Department is a member of this interdiction unit. The passenger
    information provided some indicators that, coupled with the agent or
    officer's training and experience, gave them reasonable suspicion to
    believe that an individual may be a drug courier. The agent or officer
    would either approach the individual in the Albuquerque train station,
    or pass the information on to a law enforcement agency in a city where
    the train was destined.
        DEA did not utilize passenger information contained in the Amtrak
    database to develop a separate DEA database so that DEA could share the
    names of all AMTRAK passengers with other law enforcement agencies. DEA
    was only interested in identifying and interviewing suspected drug
    couriers.
                                     ______

             Questions Submitted by Senator Ben Nighthorse Campbell
                                    ecstasy
        Question. It has come to my attention that there is a new drug on
    the streets of our country known as Ecstasy and we have seen a dramatic
    increase in the use of it over the last year or so. There have been a
    couple of high profile cases in my home state of Colorado where young
    adults who have taken this drug have died.
        What, if any, findings has the DEA come across with regard to
    Ecstasy manufacturing, distribution, and use? Has the DEA seen an
    increase in the amount of Ecstasy tablets penetrating our borders from
    overseas distributors? Given this, can we determine from what region,
    or what specific countries these tablets are coming from? What are the
    major ports of entry?
        Answer. Methylenedioxymethamphetamine (MDMA), or Ecstasy, is a
    synthetic, psychoactive drug possessing stimulant and mild
    hallucinogenic properties. Ecstasy is a dangerous drug--deceptively
    dangerous. For this reason, the widespread growth of Ecstasy use has
    been nothing short of alarming. Ecstasy-related emergency room
    incidents have increased from 1,143 in 1998 to 2,850 in 1999, the last
    full year for which data is available. In 2000, DEA seized over 3
    million tablets of Ecstasy, compared to slightly over 1 million tablets
    in the previous year.
        The oral form of MDMA is usually sold in tablets inscribed with
    brand logos such as the trade symbols of Mitsubishi, Rolex, and the
    Rolling Stones. MDMA was temporarily listed as a Schedule I controlled
    substance on an emergent basis in 1985 and permanently placed into
    Schedule I in 1988. The vast majority of MDMA consumed worldwide is
    manufactured in clandestine laboratories based in Western European
    countries such as the Netherlands and Belgium. Once the MDMA reaches
    the United States, a domestic wholesale distributor will sell the drug
    for $6 to $8 per tablet. The retailer then distributes it for $25 to
    $40 per tablet.
        The MDMA manufactured in Europe is routinely transported and
    distributed by factions of Israeli and Russian organized crime groups.
    These organizations also utilize couriers, common carriers and parcel
    services to facilitate the transport of MDMA into and within the United
    States. Recently, Colombian and Dominican trafficking organizations
    have become involved in the transportation and distribution of MDMA.
        The increase in MDMA consumption is directly related to the
    increased popularity of a social gathering known as the ``rave,'' an
    all night techno-dance party. The common rave participant can be as
    young 14 years old and as old as the mid to late 20s. Participants can
    take several MDMA tablets during an evening spent at a rave to enhance
    the rave experience. Unfortunately, many teens do not perceive MDMA as
    harmful or dangerous. Acute effects of MDMA ingestion include bruxism
    (teeth grinding), trismus (jaw clenching), increased heart rate,
    increased blood pressure, hyperthermia, sweating and dehydration.
    Complications from MDMA use include acute renal failure, cardiac
    arrhythmia, cardiovascular collapse, cerebral infarction, depression,
    mental fatigue and psychosis.
        The Drug Abuse Warning Network (DAWN) estimates reveal that
    nationwide hospital emergency room mentions for MDMA increased
    dramatically from 1993 to 1998. Seizures of MDMA also have increased
    drastically from 1993 to 1999. There have been reports of deaths in the
    United States and abroad related to the ingestion of PMA (para-
    methoxyamphetamine), which is represented and sold as MDMA. While the
    drugs may be chemically similar, it appears that PMA does not share the
    same physiological effects as MDMA. Believing that the tablets have a
    lower concentration of MDMA, the user will take several more tablets in
    a short period of time (``stacking'') to attempt to achieve the desired
    effect. This repeated ingestion of tablets could lead to toxicity and a
    potentially fatal overdose.
        Question. What has been done to stem the rising number of incidents
    involving the use of this drug? What specific action or plan of action
    is the DEA taking to curtail the illegal importation of Ecstasy into
    the United States? On a national front? On a local front (communities
    and schools)?
        Answer. Due to the exponential growth of MDMA use and abuse, DEA
    has developed a very ambitious multi-faceted MDMA/Club Drug Initiative.
    The primary objective of this approach is to target and dismantle
    various elements of the MDMA trafficking groups from all fronts--
    international, national and local. To augment this enforcement
    initiative, DEA also has instituted a very aggressive demand reduction
    program targeted at students and parents alike.
        Through close coordination and the sharing of intelligence with our
    foreign host counterparts, DEA has identified several international
    MDMA drug trafficking organizations and their surrogates that transport
    and distribute MDMA throughout the United States. Because the
    Netherlands is the principal source zone for ecstasy destined for the
    United States, DEA has worked closely with Dutch and other European law
    enforcement authorities in an effort to dismantle these MDMA
    trafficking organizations. On a national front, through close multi-
    agency coordination, DEA continues to pursue the domestic command and
    control networks of these organizations. By utilizing the resources of
    the Special Operations Division, DEA, in conjunction with the Federal
    Bureau of Investigation, the United States Customs Service, the
    Internal Revenue Service and other federal, state and local agencies,
    has effectively identified and dismantled several of these
    organizations.
        On a local level, it has been well established that raves are the
    primary venues in which MDMA is used. It is quite evident that many
    rave club owners and operators cater to MDMA users and appear to
    advocate the club drug culture. As such, in furtherance of this
    initiative, DEA, in close coordination with state and local
    counterparts, has attempted to reduce rave activity through enforcement
    of juvenile curfews, health and fire code ordinances and various
    licensing requirements. Furthermore, DEA field divisions identify the
    most active rave clubs in their areas of responsibility as well as
    resources necessary to target these clubs and their owners/promoters.
    One anti-rave initiative of note was undertaken in New Orleans,
    Louisiana, by the DEA New Orleans Field Division, the New Orleans
    Police Department and the U.S. Attorneys Office. Through the innovative
    use of 21 U.S.C. 856, also referred to as the ``Crack House'' statute,
    a rave promoter was arrested and the largest rave operation in New
    Orleans was closed. Perhaps most significant is the fact that since the
    completion of this operation, ``club drug'' related overdoses in New
    Orleans have dropped 90 percent, with ecstasy overdoses disappearing
    altogether. This statistic clearly shows a very strong correlation
    between rave activity and club drug overdoses resulting in emergency
    room visits.
        To focus national attention on the MDMA threat, DEA hosted the
    International Conference on Ecstasy and Club Drugs in partnership with
    approximately 300 officials from domestic and foreign law enforcement,
    judicial, chemical, prevention and treatment communities. The
    conference was held from July 31, 2000, to August 2, 2000, at DEA
    headquarters in Arlington, Virginia. As a follow-up to last year's
    conference, DEA is planning a series of regional club drug conferences,
    that will serve the purpose of taking DEA's demand reduction message
    out to a variety of selected communities. The first of these regional
    conferences was held in Atlantic City, New Jersey on May 2-3, 2001.
    Hosted by the DEA Newark Division in conjunction with the New Jersey
    State Police, and New Jersey Prevention Network, the conference focused
    on providing community based solutions to problems relating to the
    abuse of club drugs. Future regional conferences will be held in
    Austin, Texas, San Diego, California and Chicago, Illinois.
    Furthermore, the following demand reduction objectives have been
    institutionalized by DEA. These objectives include:
      --Working with local, state, and other federal agencies and nonprofit
            organizations in an effort to advance drug education and
            prevention;
      --Enhancing parental knowledge of raves and club drugs and engage
            their active participation in education and prevention of drug
            abuse; and
      --Educating high school and college students on the realities of
            raves and the effects of club drugs on the human body.
        The education of high school and college students on the realities
    of raves and the effects of club drugs in the human body is a necessary
    part of DEA's demand reduction program. Institutions of higher
    education that receive federal funds are required under the Higher
    Education Act to implement a drug and alcohol abuse prevention program
    for students and staff, and the DEA, working with the Department of
    Education, must focus institutions' efforts on meeting this
    requirement.
        Finally, DEA will continue to apply a ``holistic approach,''
    utilizing a well coordinated combination of programs that include
    Demand Reduction, Education, Treatment, and a Law Enforcement strategy
    that makes maximum use of realistic penalties that reflect the
    destructive nature of Ecstasy trafficking.
                                     hidta
        Question. As you know, the DEA has participated in the Rocky
    Mountain HIDTA program since it was created in 1996. This combined
    anti-drug enforcement effort among federal, state, and local law
    enforcement agencies has been expanding its anti-drug efforts in the
    Rocky Mountain region. I would be interested in your opinions and
    observations as to the success and effectiveness of the HIDTA program
    generally, and the Rocky Mountain HIDTA specifically.
        Answer. The HIDTA program has shown some definite results, and has
    been particularly effective in uniting local, state and federal
    agencies in the pursuit of high level regional, national and
    international investigations.
        In general the HIDTA program has been very successful in achieving
    its individual goals and objectives in support of the National Drug
    Control Strategy. In most instances there have been continuously
    improving coordination and cooperation among all the HIDTA participants
    at all levels. Even the newly established HIDTAs have this as a
    principal goal to achieve for success. It should be noted that HIDTA
    functions through task forces that are chaired by various participating
    agencies. HIDTAs have continued to have a regional impact on drug
    enforcement operations.
        The Rocky Mountain HIDTA is unique in its geographical scope. It is
    one of only a few HIDTAs that covers more than one state. The Rocky
    Mountain HIDTA covers 3 states covering approximately 286,000 square
    miles with a total population of approximately 7 million people. The
    region includes two major interstate highways, I-70 and I-80, that are
    primary corridors for illicit drugs going from California to areas of
    the midwest and the eastern United States. Traffickers from the
    southwest border are using rural highways through New Mexico and
    Arizona with no need to hit major interstates until well into Colorado
    and Utah where they are able to reach I-25 and the I-70 corridor.
        Due to the large geographical area involved, the Rocky Mountain
    HIDTA has a greater number of initiatives than most other HIDTA's. Many
    of these initiatives do not have direct federal participation due to
    the limited number of federal resources in such a large geographic
    area.
        Investigative initiatives have upgraded their investigations to
    focus on a more regional and national level. There is new emphasis on
    pursuing the investigations as far as possible, even outside their
    initial jurisdiction and outside their state. There is a new attitude
    of cooperation, coordination and support among the different
    initiatives working more closely than they have in the past. Arrest of
    drug traffickers, drug seizures, clan lab seizures and dismantling/
    disrupting of drug trafficking organizations have all increased. The
    number of investigations that were coordinated outside the Rocky
    Mountain HIDTA region also has increased.

                              subcommittee recess

        Senator Gregg. If there is nothing further, the
    subcommittee is recessed.
        [Whereupon, at 11:34 a.m., Thursday, May 17, the
    subcommittee was recessed, to reconvene subject to the call of
    the Chair.]

    DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE JUDICIARY, AND RELATED
                  AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2002

                                  ----------

                            THURSDAY, JUNE 28, 2001

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 10:23 a.m., in room SH-216, Hart
    Senate Office Building, Hon. Ernest F. Hollings (chairman)
    presiding.
        Present: Senators Hollings, Inouye, Kohl, and Stevens.

                       FEDERAL COMMUNICATIONS COMMISSION

    STATEMENT OF MICHAEL K. POWELL, CHAIRMAN
        Senator Hollings. The committee will come to order. We
    apologize for the lateness, but these votes and work on the
    floor has kept our ranking member, Senator Gregg, from being
    here. He is handling the bill on the floor.
        We welcome Chairman Powell this morning and we would be
    delighted to hear from you, sir.
        Mr. Powell. Thank you, Senator. It is always an honor and a
    privilege to appear before you. I am particularly pleased to do
    so given that so many of the members of this subcommittee are
    also on our authorizing committee. It gives us an opportunity
    to continue the dialogue that we began in one forum and
    continue it in another to make sure that we have the resources
    we need to deal with the challenges we face.
        Simply put, we know the old adage is things change.
    Sometimes they do more than change, they transform and
    metamorphosize, and I would suggest that that is the basis of
    the challenges we are facing in the communications industry
    today.
        The Federal Communications Commission is in a period that
    it has never faced before. Virtually every segment of its
    portfolio is in the midst of its most profound revolution,
    whether that be television, cable, wireless technologies, or
    satellite technologies. All of them are struggling to take
    advantages of substantial and dramatic technological
    breakthroughs that will change forever not only the way they
    provide service, but the potential kinds of products and
    services that are going to be available to our citizens. The
    Federal Communications Commission is going to sit in the midst
    of this, trying to figure out the proper and thoughtful
    regulatory paradigm that will govern in this period of
    transformation. All the while, service providers attempt to
    move their architectures to the advanced IP based, digital type
    of architectures that are more efficient and offer more
    possibility and potential for consumer welfare. So the role of
    the Federal Communications Commission is going to be critical
    in that regard.
        It seems to me that in order for us to do our job well, we
    are going to have to have a period of change ourselves to make
    sure that we have what equates to a blueprint or business plan
    that allow us to be an efficient, effective, and responsive
    institution in the midst of this uncertainty, cacophony, and
    change. We believe that that challenge is going to be
    paramount, and so we have begun to develop what I fondly refer
    to as the Commission's business plan. That business plan will
    have four key planks.
        The first is to constantly struggle to provide a clear,
    substantive policy vision that guides our deliberation. It is
    becoming crystal clear to me that we have to have a very
    pointed focus on advanced technology development and
    deployment, broadband technology for our citizens whether that
    is wireline and cable and DSL, whether it is in the wireless
    space in the name of third generation and advanced wireless
    infrastructures, or whether it is new satellite offerings.
    These are the products and services that our consumers are
    waiting to receive and I think that that has to be a central
    focus of the Commission.
        But all the vision in the world is useless if we do not
    take our responsibilities to operate and manage the agency
    effectively and efficiently. I take great pride--it is not a
    burden to me--in being the central manager of the Federal
    Communications Commission. I take that part of the
    responsibility deeply seriously. I think the Commission needs
    to be an agency that can get to the bottom of things
    effectively and make decisions quickly to remove the
    uncertainty associated with regulatory action.
        We are working hard to do that. We have developed annual
    strategic planning cycles. We are looking to measure our
    productivity measures across bureaus and offices. We are
    working hard to modernize our internal IT structure, putting
    greater emphasis on efficient electronic filing and the kinds
    of automated processes that allow us to get through our work
    more efficiently. And we are working on telecommuting so that
    our employees have the opportunity both to invest in their
    families as well as their workplace, and can continue to use
    the technology to provide a contribution to the public
    interest.
        The third component, and I think perhaps the most important
    component of an FCC----
        Senator Hollings. I started to say ``amen.'' You are doing
    great, but I heard the expression ``public interest'' and I
    appreciate it.
        Mr. Powell. Thank you. I know that is of interest to you
    and all of us.
        The third component, which I think is the most important,
    that has been neglected, frankly, over the years, and that is
    the understanding that the agency is in a position of needing
    an independent indigenous technical capability. I will tell
    you, I have been at the Commission 4 years and I have seen the
    pitfalls of regulating companies and dealing with regulatory
    decisions with the likes of Steve Case or Bill Gates having to
    teach us how their technology works at the same time we are
    supposed to make an independent regulatory judgment about that.
        It is at some levels at crisis stage, and we are fond of
    pointing out that in 4 years, 40 percent of our engineers are
    eligible for retirement and we simply are not replacing that
    capability at anywhere near that rate of attribution. We need
    to make sure that our engineering and technical components will
    get improved upon so that we can make those decisions more
    effectively in a world to which the technology is the central
    driver of change in that industry.
        Not only do we need focus on the recruitment and retention
    of technical talent, we need to have professional development
    and training when we get them. Engineers have to stay current
    in their guild. They have to have the programs and policies
    that allow them to continue to stay on the cutting edge and we
    need to modernize our own engineering laboratory facilities so
    that we can use the tools there to measure conflicting and
    competing claims about technology and interference and issues
    of the like.
        And finally on that component, I think we have to remember
    that the technology issues are not just one for technologists.
    They are for lawyers and economists and policy makers and
    analysts, as well. We have to have a confluence in that regard.
    One of the things I am most proud of is we are building what I
    like to refer to as the ``FCC University''. We are working hard
    to develop an annual curriculum of courses in which we use our
    most talented individuals to hold instructional courses. We
    have partnered on occasion with universities, with professors,
    with scholars, with technologists, so that our employees have
    an annual cycle of being able to access that curriculum, take
    courses to stay current in their field, and hopefully be
    revitalized both in their morale and their attention to public
    service, which I think is also critical to the country.
        And finally, the Commission needs to take a concerted and
    thoughtful study of its organizational structure to see whether
    it is organized optimally to make the kinds of decisions that
    these markets are increasingly demanding. We have all heard the
    overused word and concepts of ``convergence'', but what it does
    mean is the traditional ``buckets'' which we often look at in
    terms of regulatory policy are more and more strained by the
    cross-interests of different organizations and we need to look
    at whether there are thoughtful ways to reorganize the
    Commission in a way that it can more effectively respond to
    those functions.
        But to be clear on that, in my opinion, that is not cutting
    the agency. I don't envision any significant diminution of
    personnel or assets, but more an optimization of the way we are
    organized and a more fruitful use of the people that we do have
    so that we can make decisions in this world of converged
    uncertainty.
        So within that regard, the Commission's budget submission,
    we ask that you and the American taxpayer invest $248.5 million
    in that regard. That is maintaining the current level of the
    labor force at about 1,975 FTEs. This represents approximately
    an 8 percent increase over last year.
        As is usually the case with the Commission, we have chosen
    to seek most of that increase in the form of regulatory fees as
    opposed to direct appropriations. The direct appropriations
    component of the budget submission remains flat over last year,
    and that is the program that we hope to work with this
    committee and our authorizers to put into place and, hopefully,
    make it an institution that not only the committee but the
    American taxpayer is proud of.

                               prepared statement

        And so with that, I am more than honored and happy to
    entertain your questions.
        [The statement follows:]
                    Prepared Statement of Michael K. Powell
        In order to serve the American public, the Federal Communications
    Commission, as an institution, must be efficient, effective, and
    responsive. The challenges of reaching these goals at the Commission
    are complicated by the sweeping, fast-paced changes that characterize
    the industries that we regulate. Indeed, the Commission is experiencing
    a challenge it has never faced--each industry segment in our portfolio
    is in the midst of revolution, and is attempting to adapt to
    fundamental economic and technological changes. There are new markets,
    new competitors, and new regulatory challenges.
        Our fiscal year 2002 budget reflects the Commission's mission to
    keep abreast of industry changes and set rational productivity and
    regulatory goals. We are asking you to invest $248.5 million to ensure
    that the FCC has the tools to facilitate its reform efforts, upgrade
    its technological capabilities and further enhance its workforce. My
    goal is not only to make the Commission an example of efficient
    management practices, but to create and maintain an employee friendly
    environment--a place where employees can hone their skills and take
    pride in their service to the American people, as well as a place where
    employees have plenty of time to invest in their families. We can work
    together to encourage participation in telecommuting programs, build
    internal training programs, and utilize programs designed to lure the
    best and the brightest to government service. We can do this by
    purchasing and maintaining state of the art technological equipment to
    ensure better service to the public as well as a productive workplace.
        My request for funding is tied to a specific business plan that I
    present here today for your evaluation. We have developed this plan
    along four dimensions: (1) a clear substantive policy vision,
    consistent with the various communications statutes and rules, that
    guides our deliberations; (2) a pointed emphasis on management that
    builds a strong team, produces a cohesive and efficient operation, and
    leads to clear and timely decisions; (3) an extensive training and
    development program to ensure that we possess independent technical and
    economic expertise; and (4) organizational restructuring to align our
    institution with the realities of a dynamic and converging marketplace.
        My goal is to improve the agency on all these levels--and to make
    many of these changes within the next year. To that end, I have been
    seeking opinions from a wide range of participants, including Members
    of Congress and their staffs, the businesses that come before the
    Commission, consumer groups, and our own skilled employees.
        I cannot predict the future, nor can anyone else at the Commission.
    When faced with future challenges that are uncertain, the best approach
    is to build a first-class operation, with top talent, that is trained
    and disciplined enough to adapt quickly to new and changing situations.
    I hope to build, along with my colleagues and the outstanding FCC
    staff, just such a unit--one well suited to an uncertain future.
        Mr. Chairman, Ranking Minority Member, and Members of the Commerce,
    Justice, State Appropriations Subcommittee, thank you for inviting me
    to appear before you today to present the Federal Communications
    Commission's (``FCC'') fiscal year 2002 Budget and discuss our
    priorities for the year ahead.
        Although I have testified before the Senate before, this is my
    first appearance before your subcommittee. I want to use this
    opportunity to affirm my commitment to working with the Members of this
    Subcommittee to build a better FCC. I also want to thank the members of
    this subcommittee for their unyielding support in seeing to it during
    the past few years that the Commission received sufficient funding to
    complete its core mission. Although the Commission is an independent
    regulatory agency, the assessment, development and implementation of
    communications policy is a team-effort, with shared responsibilities
    between the various branches of government. It is my primary
    responsibility to ensure that the FCC follows its statutory mandates in
    enforcing communications laws. And, I want to work with you to make the
    Commission a model of efficiency and transparency for all independent
    regulatory agencies.
        I believe that a critical part of my job is to be a leader and
    steward of the Commission, and I take this responsibility very
    seriously. In order to serve the American public, the FCC as an
    institution must be efficient, effective, and responsive. The
    challenges of reaching these goals are complicated by the sweeping,
    fast-paced changes that characterize the industries that we regulate.
    Indeed, the Commission is experiencing a challenge it has never faced--
    each industry segment in our portfolio is in the midst of revolution,
    and is attempting to adapt to the most fundamental changes. There are
    new markets, new competitors, and new regulatory challenges.
        Serving as Chairman of the FCC at this juncture in history gives me
    a unique opportunity to take stock and assess our regulatory framework,
    and to develop guiding principles that will encourage economic growth
    in the communications sector and maximize consumer welfare. Our fiscal
    year 2002 Budget request represents a critical part of our efforts to
    make the Commission more cost-effective and results-oriented. Today, I
    will provide you with a summary of our fiscal year 2002 Budget
    Estimates and discuss our plans for using these funds to enhance the
    Commission's productivity, and ensuring that we are capable of meeting
    the future needs of both consumers and the communications industry.
                      new beginnings for an old commission
        In order to understand our budget request, it is important to
    assess where we are now, and how we plan to use our resources in the
    future. The Federal Communications Commission received its initial
    statutory authorization when Congress passed the Communications Act of
    1934. It was a time of severe economic depression--but also of
    technological change necessitating regulation of the cacophony of
    voices on the nation's airwaves. The Commission became part of
    Washington's alphabet soup, and developed a culture and structure
    designed to handle the licensing of radio stations. When change came in
    the beginning, it was slow and gradual, from the hardwiring of American
    homes for telephones, even in rural areas, to the advent of television,
    and the introduction of cable--these are the issues that the Commission
    had to deal with in the middle part of the twentieth century. The
    Commission divvied up the airwaves according to what was seen as the
    highest and best use of the spectrum and often decided who would
    receive the spectrum based on the subjective evaluation of the
    character of the applicants.
        The Commission's processes and mission have evolved during the past
    70 years. While we still spend a great deal of time on spectrum
    management, the number of potential users and uses increases
    dramatically each year. Instead of exclusively focusing on broadcasting
    and hardwired phones, we concentrate on expanding the spectrum to
    accommodate new technologies like third-generation wireless and ultra-
    wideband. Our goals and regulatory mission are defined in a host of
    adjustments to the Communications Act of 1934, including the
    Telecommunications Act of 1996. Our responsibility to auction the
    spectrum is a creation of the budget and appropriations process, and it
    currently represents both a mechanism for encouraging competition and a
    valuable source of revenue for the U.S. Treasury. Today, the
    Commission's primary mission is to promote a fully competitive
    marketplace as well as access for all Americans to communications
    services. We achieve our mission with a combination of manpower and
    technology--from electronic auctions, to automated licensing, and
    innovative spectrum management techniques.
        No one in 1934, or even 1964, could have foreseen the revolution in
    communications that we have experienced in the last decade alone. We
    know that communications developments are not finite and that they will
    no longer come slowly. The winds of profound and dynamic change,
    unleashed in part by the 1996 Act, have buffeted the Commission and
    blown it into a position where its decisions have far-reaching impact
    on the future of communications, not only in the United States, but
    also throughout the world. We have come a long way from an agency where
    the principal focus was the assignment of radio licenses, and its
    principal activity was conducting lengthy comparative hearings to
    assign those licenses. This new environment is no longer linear, but
    chaotic and dynamic. During the next part of this decade, we expect the
    communications markets to expand exponentially and develop in a
    competitive environment.
        In thirty years, the Commission will not be our FCC, but our
    children's FCC. I want to join with you to make the FCC a better place
    and to ensure that we keep in step with the future. To facilitate
    progress and not stand in its way, we must review our mission and goals
    within the confines of Congress' mandate and develop an internal
    mechanism for improving our ability to foster competition in an ever-
    changing marketplace. For this agency to fulfill its congressional
    charge, indeed to remain relevant at all, it must put together a new
    business model and build the type of team that can execute it
    effectively. And with your help, that is precisely what we intend to
    do.
               an investment in the future: the fcc's 2002 budget
        To realize a more effective, efficient and responsive FCC, it
    requires enhancing productivity, management review and retraining, as
    well as technological upgrades to integrate all of these facets into a
    productive work environment. Today, I ask you to invest in achieving
    these objectives. Our fiscal year 2002 Budget requests that you commit
    $248,545,000 to the future of communications policy. Our total budget
    request is $18.5 million over last year's appropriation, representing
    slightly more than an eight-percent increase. This increase is critical
    to financing programmatic and mandatory costs. The budget supports a
    staffing level of 1,975 full-time equivalents (``FTEs''). This level
    includes FTEs funded from both appropriations and auctions resources.
        Much of the increase--41 percent--covers uncontrollable cost
    increases to fund proposed government-wide pay raises, rent increases
    and other inflationary increases. Specifically, our request includes $6
    million for mandatory salary and benefit increases and $1.6 million for
    Consumer Price Index adjustments in contract services. The remaining
    portion of our budget--and, by far the most critical--comprises
    programmatic increases to accomplish the Commission's comprehensive
    information technology strategic plan initiatives. We are requesting
    $10,997,000 for these information technology (``IT'') enhancements.
    This amount includes funding for equipment originally scheduled (but
    not funded) for replacement in fiscal year 2000 and fiscal year 2001.
        We intend to use our requested funding to build upon past
    improvements. In the past few years, we have streamlined our licensing
    procedures and implemented electronic filing capability in 78
    applications--that is 72 percent of all major information systems. At
    the end of fiscal year 2000, approximately 62 percent of all
    applications were filed electronically. And, 93 percent of all
    applicants were acted on within our processing goals. The use of
    information technology has led to improved processing time as well as a
    significant decrease in the number of backlogged applications. The
    failure to invest in our information technology systems, either in the
    form of lifecycle replacement or technological upgrades, could lead to
    backsliding in our backlog elimination operations, and undermine our
    efforts to reform the Commission. It is important, however, that we do
    not automate what may be a flawed process. I intend to initiate a
    strategic review of our processes to ensure that they are accomplishing
    their intended goals.
        I am cognizant of the fact that the funds I request here today
    belong to the taxpayer and not the Commission. For that reason, we ask
    only what is necessary to maintain and improve the Commission's
    services and resources. It is important to note, however, that since
    1987, the Commission has worked to reduce the cost of government
    operations by implementing the congressionally mandated user fee cost
    recovery programs. The first program, the ``Application Processing Fee
    Program,'' was designed to recover a substantial portion of the costs
    of the Commission's application processing functions, which account for
    the majority of the licensing activity costs.
        In 1994, we implemented the ``Regulatory Fees Cost Recovery
    Program.'' Since that time, we have collected fees to recover the costs
    attributable to the Commission's competition, enforcement and public
    information services. Unlike the Application Processing Fee Program,
    these fees can be retained by the Commission and applied to obligations
    incurred during the current fiscal year, thereby reducing the amount of
    appropriated funds required from the General Fund of the Treasury.
    Since fiscal year 1994, the fee offset to our appropriation has
    increased from 38 percent to approximately 87 percent in fiscal year
    2001. I plan to maintain that level and even increase it slightly to 88
    percent during fiscal year 2002. The actual appropriation requested by
    the Commission for the next fiscal year represents $29,788,000 in net
    direct budget authority since we intend to collect $218,757,000 in
    offsetting collections from regulatory fees. I am proud of our work in
    reducing our direct appropriation, and I believe that given the
    appropriate tools, we will improve on this record.
                        keeping our part of the bargain
        Two months ago, I testified before the House Subcommittee on
    Telecommunications and the Internet concerning FCC reauthorization and
    reform. Last month I testified before the House Commerce, Justice,
    State Appropriations Subcommittee. In both of those instances, I gave
    my commitment to following through on reform and asked our House
    authorizers and appropriators to join me in this effort. Although the
    financial needs outlined here are an important component of our reform
    efforts, we already have implemented a management review designed to
    make the Commission a model agency. I pledge to you that I will use the
    taxpayers' funds constructively as a way to improve our services and I
    provide you here with a four-point business plan that you can use to
    evaluate the financial worth of our efforts. Let me emphasize that we
    are not ``reinventing'' the Commission, because that would be Congress'
    prerogative, and until legislation provides us with the ability to
    reprioritize some of our functions, we will work within the statutory
    limits set by Congress. My plan is designed to use our requested
    funding in a constructive fashion--to improve the management and
    employment environment in a way that benefits the American people.
                       fcc reform: the new business plan
        I conceive of FCC reform as a comprehensive retooling and
    redirection of the Commission's entire mission. Our approach is to
    write and execute a new business plan built along four dimensions: (1)
    a clear substantive policy vision, consistent with the various
    communications statutes and rules, that guides our deliberations; (2) a
    pointed emphasis on management that builds a strong team, produces a
    cohesive and efficient operation, and leads to clear and timely
    decisions; (3) an extensive training and development program to ensure
    that we possess independent technical and economic expertise; and (4)
    organizational restructuring to align our institution with the
    realities of a dynamic and converging marketplace.
    Substantive Vision
        The United States has a proud legacy in the area of communications
    services. This nation built the finest voice communication system in
    the world, as well as top-notch mass media delivery systems in the form
    of radio, television, and cable. These systems have reached maturity
    though--we understand the basic technology and architecture; we largely
    understand the cost characteristics; and, we understand what the
    consumer wants and what the product is. And, government regulation and
    policy had coalesced around these understandings, principally in the
    form of regulated monopoly and oligopoly.
        We are now only beginning to appreciate and deploy the new advanced
    architectures and technologies of services like broadband. The cost
    characteristics may differ substantially from those of traditional
    networks to which we are accustomed. Broadband Internet products are
    still being developed and we all wait to see what service offerings
    consumers will and will not embrace. It is a world of dynamic and
    chaotic experimentation and unpredictable change.
        I believe government policy needs to migrate steadily toward the
    digital broadband future, but recognize that we will be unable to
    anticipate every change before it happens. I submit that this digital
    broadband migration should be built around incubation, innovation and
    investment. At the Commission, our policy direction will focus on this
    migration and will have several directional guideposts:
      --Facilitate the timely and efficient deployment of broadband
            infrastructure. Endeavor to promote the growth of a wide
            variety of technologies that can compete with each other for
            the delivery of content and will strive not to favor--or
            uniquely burden--any particular one.
      --Pursue the universal service goals of ubiquity and affordability as
            new networks are deployed, and do so in creative fashion.
      --Redirect our focus onto innovation and investment. The conditions
            for experimentation and change and the flow of money to support
            new ventures have often been misunderstood or neglected. If the
            infrastructure is never invented, is never deployed, or lacks
            economic viability we will not see even a glimmer of the bright
            future we envision.
      --Harness competition and market forces. Drive efficient change and
            resist the temptation, as regulators, to meld markets in the
            image of any particular industry player.
      --Rationalize and harmonize regulations across industry segments
            wherever we can and wherever the statute will allow.
      --Shift from constantly expanding the bevy of permissive regulations
            to strong and effective enforcement of truly necessary ones. To
            that end, I support H.R. 1765, which would increase by 10 fold
            statutory levels for forfeitures, as well as extend the statute
            of limitations for common carrier enforcement actions to two
            years. When combined with solid auditing and enforcement of our
            rules, especially those prohibiting regulated entities from
            passing along their fines to ratepayers, I believe that these
            changes will have a solid, deterrent effect against illegal
            activities.
    Operations and Management
        All the vision in the world is useless if you do not build and
    manage an institution that can execute it. We intend to actively manage
    the agency. Indecision and avoidance are not legitimate policies and,
    thus, we will strive to reduce backlogs and put systems in place that
    will prevent these problems. Managers will be measured, in part, on
    this basis. The Commission will develop an annual strategic planning
    process that will be integrated with the federal budget cycle and the
    review of our performance as an institution and as individuals. We are
    working to establish uniform measures of productivity across the agency
    to facilitate this activity.
        The Commission is developing a set of internal procedures that will
    allow it to function more smoothly. These procedures will cover
    subjects such as Commission deliberation, voting procedures and
    internal document security.
        The Commission should continue to modernize its information
    technology infrastructure to ensure productivity gains. We must strive
    to be a virtual agency--one in which someone in Connecticut is able to
    access us as easily and readily as someone on Connecticut Avenue. We
    are working to make this goal a reality through increased electronic
    access capability. We are engaged in a time-consuming and expensive
    project, but one that is critical to our ability to remain relevant in
    this new millennium. We must continue with due speed to use the
    advances of technology to our advantage.
        We have 18 major information technology systems that incorporate
    electronic filing or offer public access to data. The industry can file
    most license requests, equipment authorizations, and comments
    electronically. A 72 percent electronic filing capability is not
    enough--we will do better. We administered well over three million
    licenses last year, so it is critical that we are efficient in this
    area. It is also important that citizens all over the United States
    have the ability to contact us easily and from anywhere--whether by
    computer, phone or letter. Last year, we received well over one million
    inquiries from consumers. The public must be an active voice in the
    communications transformation, for they are the ultimate beneficiaries
    of the abundant choices resulting from competition.
        Better management and a wider application of technology initiatives
    leads to enhanced productivity and an improved quality of life for
    employees. The Commission should be a place to work, not live.
    Employees should have a fair opportunity to work from home, providing
    greater flexibility to meet the demands of modern family life. That is
    why the Commission undertook an ambitious rollout plan for
    telecommuting last year. We intend to overlay our virtual agency
    concept to the benefit of FCC staff through an expansive telecommuting
    program, which is open to nearly 100 percent of the Commission's
    employees. Approximately 400 of our eligible employees, about 20
    percent, have chosen to telecommute on either a regular or ad hoc
    basis. We began the telecommuting program to increase productivity,
    improve morale, improve job satisfaction and reduce absenteeism. I am
    pleased to say that other agencies look to us as a model.
    Technical and Economic Expertise
        Since advances in technology are driving the communications
    revolution, the Commission must have a strong fluency in the language
    of technology. We cannot depend on those we regulate for on-the-job
    tutorials while we make decisions. Over the last six years, our
    engineering staff has decreased by more than 20 percent. Within the
    next four years, 40 percent of our engineering staff will be eligible
    to retire. Conversely, we are not replenishing the coffers at the other
    end by bringing in new employees. Like other governmental departments
    and agencies, we are competing for this talent in a tight labor market
    and are challenged to convince talent to enter government service. This
    has been most apparent trying to recruit entry-level engineers at the
    GS-5 and GS-7 levels.
        To address this situation the Commission is developing an agency-
    wide ``Excellence in Engineering'' program. We will examine creative
    ways to gain greater personnel and pay flexibility to attract technical
    talent. Increased salaries alone, however, will not do the trick, nor
    is it the sole motivator for anyone entering government service. While
    government service in and of itself should elicit a sense of pride, we
    will increase our technical employees' worth by ensuring that they are
    able to continue to develop in their field, through strong training and
    development programs and job rotation. Our laboratory facilities in
    Columbia, Maryland need to be upgraded to provide engineers with the
    tools to engage in critical and challenging work. If we receive full
    funding this year, we believe that we can adequately address the
    initial needs of this program, and then have the flexibility to plan
    for the future to request additional funding during the next budget
    cycle.
        It also is vital that we train our non-engineering staff in the
    areas of engineering and advanced technology. We already have begun to
    develop an FCC ``university'' of sorts using our own staff and guest
    lecturers, and taking advantage of various programs currently available
    through the government and local academic institutions. We can use this
    Washington, D.C. location to our advantage and tap into industry and
    academia. We can use local scholars and have them participate in an
    educational curriculum, to provide lectures, to provide classroom
    instruction, to provide counsel and advice.
        I am putting similar emphasis on economics and market analysis.
    These tools are essential to our agency's mission. We have the
    opportunity to take advantage of both internal resources, visiting
    experts, and outside educational programs to help not only our
    economists improve their skills but to help all the FCC's employees
    understand better the impact of our rules on technological innovations,
    and competitive markets. It is critical that we look to a plethora of
    information sources in gathering opinions and forming our policy.
    Restructuring
        Communications policy has been written in carefully confined
    buckets premised on certain types of technology. The FCC's
    organizational structure largely mirrors that premise. But the
    convergence of technology tears down those traditional distinctions and
    makes it evermore difficult to apply those labels to modern
    communications providers. In the same way, it makes it more important
    than ever for us to examine whether those organizational buckets still
    hold water.
        About a year ago, we began breaking down the technology-based
    divisions with the creation of the Enforcement Bureau and the Consumer
    Information Bureau. With those reorganizations, we created two bureaus
    aligned along functional responsibility. We created the Enforcement
    Bureau to improve the effectiveness of our enforcement activities in an
    increasingly competitive and converging market. We created the Consumer
    Information Bureau to enhance consumers' ability to obtain quick, clear
    and consistent information about communications regulations and
    programs. These changes have proven to be beneficial. As the industry
    moves toward fuller competition, the missions of these bureaus become
    even more critical. For consumers to take full advantage of the choices
    that competition brings, it is important that they have access to
    information that allows them to make an informed choice. Their ability
    to easily and quickly convey to us instances where the markets are not
    providing useful information to consumers in a particular circumstance
    or with a particular business is our early warning system for market
    failure or malfeasance on the part of industry players. While the
    consolidation of these functions is almost complete, there are some
    additional functions that are transferable into or out of those two
    bureaus.
        We have undertaken a structural reorganization project that builds
    on some of the initial efforts of my predecessor, Chairman William E.
    Kennard. Our efforts will be guided by a few key objectives: (1) a
    functional organization designed along market lines, rather than
    technical ones; (2) a flatter substantive bureau structure; and (3)
    greater consolidation of key support functions.
        Our program will proceed in phases. We have begun by systematically
    taking account of the agency's activities and functions to see what is
    working well and what is not. From that review we will produce a Phase
    I, short term, restructuring plan and a Phase II, longer range plan.
    The Phase II plan will consider whether wholesale change is necessary
    and whether it is timely to move away even more from technology-based
    buckets. We will be looking at what economic or marketplace triggers
    are indicative of the need for further restructuring. The question has
    been asked whether the Commission should be aligned along functional
    lines--e.g., enforcement, consumer information, spectrum management,
    licensing and competition--given increased convergence in the industry.
    This question deserves to be asked and answered. But first, we must
    seek additional and substantial information, and be completely
    satisfied that it is the right thing to do, before we move to rearrange
    substantially the organizational structure of the agency.
        My goal is to improve the agency on all these fronts. An informed
    decision, however, is better than one based merely on supposition. We
    are seeking the opinions and thoughts from a wide range of participants
    as we proceed down the path of reform. I also look forward to working
    closely with this Subcommittee and other Members of Congress and their
    staffs on this matter.
                                   conclusion
        The primary impetus for my reform program is to ensure that the
    Commission develops an enhanced ability to carry out its core mission:
    promoting the public interest through communications competition in a
    cost-effective, efficient, and transparent regulatory environment. We
    are not here to find a solution to every problem related to
    communications. We can promote an atmosphere of competition where we
    step into the picture to ensure fairness of process, to stop predatory
    and anti-competitive behavior, and to make certain that the airwaves
    are free from clutter and pirates. We can and should make certain that
    the public interest and public safety are protected, while recognizing
    that we must work within the four-corners of our statutory mandate.
        I cannot predict the future, nor can anyone else at the Commission.
    When faced with future challenges that are uncertain, the best approach
    is to build a first-class operation, with top talent, that is trained
    and disciplined enough to adapt quickly to new and changing situations.
    No army, for example, can know in advance what it will find when it
    engages on the battlefield. The fog and terror of war never afford the
    luxury of predictability. The key to success is to have a force that is
    well-trained in tactics, strategy and the weapons it will need. A force
    that is disciplined and able to adjust quickly and adapt to fluid
    conditions--threats and opportunities both will present themselves
    through the haze. I hope to build, along with my colleagues and the
    outstanding FCC staff, just such a unit--one well suited to an
    uncertain future.
        Thank you. I would be happy to answer any questions this
    Subcommittee may have.

        Senator Hollings. Does this take care of the engineers,
    experts, and lawyers, too, that you need, because it looks like
    everything you do is appealed and joined or what have you, so
    you have got to make a complete record. On the one hand, you
    have got to have the personnel in order to do the work.
    Otherwise, you have got to have the engineers, like you say, to
    know what we are talking about. This takes care of it?
        Mr. Powell. No, it does not take care of it.
        Senator Hollings. Two-hundred-and-forty-eight-point-five.
        Mr. Powell. It does not, over time, take care of it. I
    mean, what I envision is that we have a program that is a
    multi-year program and this is the first step of the program,
    which is critical. This budget submission includes resources
    that we intend to dedicate to this function and to this
    program. But I assure you that we will, as we learn more about
    our needs in subsequent years, continue to pursue additional
    funding in support of that program. In a perfect world, I would
    love more now. But I think that we, if we are fully funded, we
    will have the critical resources we need to begin the first
    steps of this program and make a meaningful difference in our
    functions within the next fiscal year.
        Senator Hollings. Well, on the House side, they cut the FCC
    some $9 million, I think?
        Mr. Powell. Yes, sir. I think it is more than $9 million,
    roughly $10 million, which is fairly significant because if you
    remove that amount, you have essentially removed all of the
    funding requests dedicated to new initiatives or the
    restoration of IT infrastructure. Basically, the majority of
    what remains are the cost-of-living adjustment increases that
    are the uncontrollable expenses of the Commission.
        Senator Hollings. That is good. I think the committee will
    want to make sure you have the entire amount requested. As a
    matter of curiosity, over the years, this argument has ensued
    until recently with the bankruptcy court in the Next Wave case.
    Not getting into the case, but rather to the fundamentals, who
    owns the spectrum? Are you and I trustees for that spectrum or
    do you just really sell at auction, time, for example, a
    license, for that spectrum?
        Mr. Powell. It is clearly the case that the spectrum is the
    public property of the American taxpayer and that we try to
    create the highest and efficient best use of that spectrum on
    behalf of that taxpayer.
        Senator Hollings. We have licensing.
        Mr. Powell. Yes.
        Senator Hollings. Let us assume you gave me a license, a
    10-year license. Aren't there conditions under that license for
    performance?
        Mr. Powell. Yes.
        Senator Hollings. In other words, suppose I just took the
    license and just sat on it. Could the Commission take action to
    recover that license or take it back for nonperformance?
        Mr. Powell. Yes. Indeed, the Commission often establishes
    conditions and benchmarks that allow it to efficiently and
    effectively reclaim the spectrum to reissue it for a higher and
    best use.
        Senator Hollings. You are good, and I appreciate it very
    much.
        Excuse me. Boy, I am honored. Here is the senior Senator. I
    am a junior Senator, not only to Strom, but to Senator Inouye.
    Senator Inouye, excuse me, Senator. You are so quiet and
    polite.
        Senator Inouye. Mr. Chairman, I thank you very much. I have
    an opening statement I would like to have made part of the
    record.
        Senator Hollings. That will be included in the record.
        [The statement follows:]

                 Prepared Statement of Senator Daniel K. Inouye

        Thank you Commissioner Powell for addressing us today. The
    FCC is tasked with many important undertakings as it encounters
    the rapidly changing marketplace and works toward fostering and
    protecting open and fair competition.
        I applaud you for your goal to reform the efficiency and
    structure of the FCC, however, we cannot afford to lose sight
    of what is most important--providing affordable and reliable
    access to telecommunications services for all consumers
    regardless of income level and regardless of whether they live
    in densely populated urban areas, as well as sparsely populated
    rural America.
        I look forward to hearing from you about the Commission's
    funding requirements and plans for fiscal year 2002.

                                 Tauzin-Dingell

        Senator Inouye. May I ask a question, which may not be
    completely relevant, but every time I turn on the radio or the
    television set, almost every 5 minutes, there is Tauzin-
    Dingell, either for or against.
        Mr. Powell. Yes.
        Senator Inouye. I suppose you have views, don't you? Can
    you share them with us?
        Mr. Powell. Senator, I generally do not take a position on
    legislation, but I will give you what I think the tradeoffs
    are. There are two competing visions for competition currently
    struggling for ascendancy. In my opinion, one vision is
    represented in part by the bill, which is the most important
    market to the American citizens is the digital broadband
    market, and that the most efficient way and the most likely way
    that that is going to be provided to consumers are going to be
    through technology-differentiated products. So the telephone
    company or the telephone infrastructure will be one broadband
    service. The cable industry will be a separate, competing,
    substitutable broadband service. Wireless might provide a
    third. Satellite might provide a fourth.
        And if that vision were to be realized, some will argue
    that then you do not have to worry as much about concentration
    within one of those stovepipes, that those are each competitors
    with each other, using differentiated technologies. I will
    leave for other people's judgment whether that day has arrived
    or whether you have a sufficient amount of confidence in that.
        It is clear that we have very viable mass market products
    out in the marketplace on cable and DSL. Wireless is out there,
    but somewhat further behind as a technology, as is satellite.
    Is two enough? Is three enough? Is four enough before one has
    the confidence to be less concerned about intra-competition?
        The other vision says that it is still very important to
    have competition within a technology so that you still have to
    have effective interconnection relationships, et cetera, et
    cetera, and that those should be preserved for now. I think
    that in many ways, those are the two competing visions, even
    though the advertisements do a bad job of describing them, that
    are being wrestled about in that, and so that is my view of
    what is at issue.
        Senator Inouye. Do the present laws provide for
    competition?
        Mr. Powell. The present laws do provide for competition. I
    think the issue is at what cost and to whom. There is no
    question that there is an inherent difficulty--they are not
    necessarily insurmountable--when competition has heavy
    dependencies, critical dependencies to get your inputs from
    those to whom you compete. The Bell interconnection regime,
    which has its value, from my perspective, as a competitive
    approach, but just frankly does require an enormous amount of
    regulation and an enormous amount of arbitration to resolve
    conflict of interconnection. It is a very time consuming and
    expensive approach, but it is an effective approach up to a
    point.
        It just seems to me that there are different players who
    gain differently from any regime you choose, but I do believe
    that we have some fundamentals in place for competition, yes.
        Senator Inouye. Will the adoption of this measure have an
    impact upon your operations?
        Mr. Powell. Oh, it would have a fairly dramatic impact. It
    would be essentially a substantial change, a reformation of the
    current telecommunications statute. There would be a, though I
    have not done the analysis, there would be a whole host of
    regulatory proceedings and rulemakings that would be either
    changed, modified, or abrogated as a consequence of the change,
    and I suspect that the Commission would have another extensive
    period of reevaluating its regulatory base, its rules, to be
    consistent with the new statutory backdrop of the regulation.
        So though we have not necessarily analyzed every aspect of
    what would be affected and what resources would be required. I
    think it is fair to say it would be a pretty major undertaking,
    even if inherently deregulatory in nature. I mean, unwinding
    things is an exercise as much as introducing things, and so the
    Commission certainly would adopt and adjust changes.
        Senator Inouye. Thank you very much.
        Mr. Powell. Thank you, Senator.
        Senator Hollings. The committee will stand in recess until
    the return of the Chair. Thank you very much.
        Mr. Powell. Thank you, Senator.
        Senator Kohl [presiding]. Chairman Powell.
        Mr. Powell. Senator Kohl.

                                  Telecom Act

        Senator Kohl. It has been over 5 years since we enacted the
    Telecom Act and there have been serious questions as to its
    real effectiveness. Instead of competition, it seems that what
    we have is litigation, and instead of more companies competing,
    we have got companies merging into even fewer companies. Before
    the Act, we had seven big telephone companies and now we are
    down, as you know, to four. So we are not sure what the
    solution is and we would like to hear what your ideas are to
    bring about more robust competition in the telecom industry,
    especially the local phone and cable television markets.
        More importantly, how would you convince Wisconsin citizens
    that passage of the Telecom Act was a good thing for them?
    Residents in Wisconsin haven't seen the benefits of increased
    choice or even something as simple as lower cable rates. So
    what would you say to the people of Wisconsin?
        Mr. Powell. I would be happy to talk to them. I think that
    part of the challenge in explaining the value, which I will
    argue is immense to consumers, that there have been many
    values, some of which are attributable to the 1996 Act. I think
    one of things that we have to do is figure out how we measure
    the consumer value.
        In 1996, there were an extraordinary amount of things
    unavailable to consumers that are now available to them and in
    extraordinary numbers. For example, very few Americans owned
    mobile telephone services in 1996, a fairly small percentage.
    Today, 40 percent of every man, woman, and child in the United
    States owns a mobile telephone and uses that telephone to a
    great degree unrivaled anywhere in the world in terms of the
    number of minutes used by consumers. That is competition,
    because if I make a telephone call on my mobile phone in my
    driveway rather than walk in and pick up the telephone, that is
    a call that would have previously occurred on the telephone
    infrastructure. But we do not capture that very well when we
    think about competition, but there is no question in my mind
    that mobile telephony has proven to be a very substantial set
    of competitors to wireline telephone and brought great value to
    consumers.
        In 1996, very few people had access to the Internet. In
    year 2000, 90 percent of Americans have access to at least
    narrowband with 10 ISPs or more. What is interesting about that
    is that it provided new ways to communicate that we also do not
    capture. If I want to talk to my sister, I might call her, but
    I might send her an e-mail. It is still a communication. The
    communication that I did not pick up the phone to make, I sent
    her an e-mail to make. Or I used the new innovations of instant
    messaging to have chats with her while I was talking to her.
        Broadband was nonexistent in 1996 for consumers and it
    really comes into the market in 1998. While that pace could be
    a lot faster, 12 percent today of Americans subscribe to that
    service. Cable modem capability is at least reaching a level of
    potential service and access for a vast number of Americans and
    the growth of DSL has been in the triple digits over the last
    couple years, and this is just a couple years.
        So this is not to defend the places where it is not working
    well. Traditional telephony competition for residential
    consumers is far below what we would have hoped and expected. I
    think that it is a challenging proposition economically and I
    think it was hard to foresee all the kinds of challenges to
    economic viability.
        One of the areas that I put a lot of emphasis on is in
    terms of the interconnecting relationships between the
    incumbent is we have to have a much stronger enforcement
    function.

                            better Enforcement tools

        Senator Kohl. All right, let me ask that question. You said
    last month that you needed stronger enforcement tools in order
    to better implement the Act. So what sort of a bill would you
    draft to beef up your enforcement powers?
        Mr. Powell. I would love to work with the subcommittee on
    that question. I think that what is most important is whether
    you have serious and substantial and credible penalty regime.
    The penalties available to us now are just simply trivial. I
    mean, a company will never say $1 million fine is trivial, but
    it is trivial to a billion dollar company, and it is trivial,
    more importantly, to when you are making a rational decision as
    to whether it is more expensive to make it viable for a
    competitor to use your facility than it is to pay the fine.
        If an operation support system has to be modified to make
    it effective for a competitor to use it but that system costs
    $1 billion and if you don't do it effectively, you will get
    fined $1 million, it doesn't seem to me phenomenal why the
    wrong decision can get made in that context.
        The penalties have never been, as best as I know, adapted
    to even inflation, and I just think that they need to be
    increased by an order of magnitude because the Commission is
    not resourced well enough to enforce every local market in the
    country, but it has to have deterrent value, and I think that
    the antitrust laws, which you, Stuart, are well aware of that,
    there is a reason antitrust has treble damages. It is because
    it can't be everywhere all the time, but the threat of that
    level of penalty helps deter--helps deter--conduct that
    impinges on competitive possibility.

                           Telephone bills confusion

        Senator Kohl. Okay. Turning to another subject, Mr. Powell,
    last week, you gave a speech in which you stressed the
    importance of the FCC's consumer agenda. Of course, we very
    much support your efforts on this front. In particular, you
    mentioned an initiative to clarify consumer confusion as it
    relates to telephone bills. Today's phone bills, as you know,
    practically require services of a lawyer to sort out the
    various fees, charges, and taxes that fill line after line of
    the invoice.
        I very much support this sort of initiative. Can you tell
    us in any detail what your plans are to make telephone bills
    easier to understand for the average consumer?
        Mr. Powell. I think there are a number of fronts we can
    pursue in that regard, and it is active and we are doing it, so
    this by no means is an exhaustive list, but one of the things
    that we have been exploring is can't we be a forum for
    explanation?
        That is, for example, we are playing with a web-based
    product that would essentially provide copies, exemplary copies
    of major telephone company bills, and that each line item might
    be an active button, so that if you did not understand what it
    meant on line three when it says, ``Federal universal
    whatever,'' you could click that and get a plain English
    explanation of where that comes from, perhaps with points of
    contact if you are frustrated by that charge. Whose
    responsibility is this charge? Is this a Government charge? Is
    this a commercial charge? Is it a competitive charge? And if
    you had a number of exemplary bills in that regard, you might
    be able to help consumers deal with the confusion of line
    proliferation.
        Of course, that kind of begs the question. That is, is it
    remedying a confusing situation. And I have thought about this
    for years, looking at the confusion consumers have over the
    bill and the uproar that goes on with increases in phone bills.
    What is interesting, it really is not the amount as much as it
    is the perception of being cut to death, bleeding to death by
    small cuts. Every time you turn around, there is a new line
    that pops up there.
        And I think that there is a whole effort that we can pursue
    in line simplification. You know, I personally wish that the
    entire Federal universal service components which are critical
    were just one line, right, and I will explain that line to you.
    I will provide brochures or literature of what is included in
    it. But I think consumers would feel that their bill is more
    stable if, rather than every 6 months when we do a proceeding
    or carriers make a change, that suddenly there are not 7 lines,
    there are 9, there are 12. That sends a--growth in that
    component, I think, is a source of great confusion and
    frustration to consumers.
        And then they do not know how much of that is a competitive
    thing. If I switch carriers, does this line item stay there or
    is that something that I can compete out of my bill? I think we
    still have some good work that we can do in that area.
        Senator Kohl. I will be looking forward to what you come up
    with.
        Mr. Powell. Thank you.

                         Cable television service costs

        Senator Kohl. One more question, Mr. Powell. I continue to
    be concerned, as we all are, with the rising cost of cable
    television service, with cable rates rising at nearly triple
    the rate of inflation in many places. Part of this rising rate
    is the cost a consumer pays to the cable company to rent the
    set-top box, which is necessary to receive many cable channels,
    and many people don't understand why the rental cost of these
    boxes continues to rise. We have been trying to create a real
    competitive market for these boxes so consumers can walk into a
    store and buy a box rather than having to rent it from the
    cable company month after month and pay these increases.
        But after 5 years of trying, consumers still cannot buy a
    box off the shelf. Why can't consumers, Mr. Powell, buy set-top
    boxes directly from manufacturers instead of having to rent
    them?
        Mr. Powell. Well, of course, the Congress passed statutes
    that tried to ensure that we created the regulatory environment
    that would make that permissible, which we did do. I think that
    the problem going on in the market is one of a sort of
    marketing and economic viability. Here is what I think is
    principally what the challenge is.
        The retail outlet--there is a struggle going on among
    manufacturers and retail outlets about revenue sharing on the
    infrastructure. So, for example, if Circuit City sells you dish
    TV, to use a satellite example, they get a cut, a continuing
    cut of that revenue from the dish company. So a lot of what
    struggling is going on is whether retailers will have an
    opportunity to be part of the business model of these boxes.
        The other thing is that the manufacturers have struggled to
    make the box cheap enough and have enough value that it will
    really be of interest to consumers when they walk in the store.
    If all the box does is you take it home and it descrambles, at
    least their judgment seems to be that there is not much of a
    market for that.
        What I have seen recently at trade shows is that there is
    an effort to start integrating the cable functionality with
    other consumer electronics functionalities so that the whole
    value of the box rises, just like dish folks are doing. So the
    cable box will have a DVD player in it and the cable box may
    have TIVO built into it so that the consumer will get the value
    of getting a DVD player and a TIVO player and, oh, by the way,
    it does cable. That is taking a lot longer than I think anybody
    expected in the marketplace, but at least as last I looked at
    it, it seemed that those boxes were on the way to stores in the
    relatively near future.
        Senator Kohl. Thank you very much.
        Mr. Powell. You are welcome, sir.
        Senator Hollings [presiding]. Thank you. Senator Stevens.
        Senator Stevens. Thank you, Mr. Chairman. I will be brief,
    Mr. Chairman.

                          Department of Defense needs

        I have had a series of meetings during the last few days
    with the Department of Defense and we are all looking at
    Defense's request for additional monies this year. We have
    already instituted a review of the needs of the Department of
    Defense for spectrum, and I am sure you are involved with that.
    I hope you are. You at the FCC share the responsibility with
    the Department of Defense, I think.
        I made the following suggestion and I wonder what you think
    about it. I suggested that Defense should be very hard-headed
    about what they really need in terms of spectrum. They ought to
    turn back a substantial amount so that it can be auctioned off
    on the understanding that Defense would get a substantial
    portion of the funds that came in. We have seen a temporary
    shortage of funds at the Defense Department for 2 years because
    of changes in the economy and other reasons, and I think it
    might be possible.
        Do you think you would be willing to work with the
    Department of Defense on this? Would you tell us your opinion
    about the Department of Defense being eligible to receive a
    substantial portion of funds resulting from the sale of their
    spectrum to support their new modernization programs?
        Mr. Powell. Absolutely. It is a tough judgment of value,
    the needs of national security and the needs of the commercial
    market for the betterment of our citizens on advanced
    technology. It is a tough call. But I think that even if you
    get there, if you find the spectrum, you have got to make sure
    that the defense needs are taken care of through some form of
    reallocation of the use of funds in order to mitigate or
    ameliorate the dislocation.
        From the Federal communications perspective, while budget
    authorities certainly keep their eyes on the amounts of money,
    I think it is a judgment of the Congress as to what the best
    use of the proceeds of auctions are. We do not draw on them
    significantly. They are yielded back to the Treasury, and I
    think that the idea of tying public policy to money that you
    receive as a consequence of that auction toward public policy
    objectives is a good idea and is something that I have always
    wondered why we did not do more. That is, look to auction
    proceeds to continue to supplement and advance other public
    policy purposes, but, you know, some of that is above my pay
    grade, but I think it is a creative idea.

                             Universal service fund

        Senator Stevens. Thank you very much. The other thing is, I
    continue to be worried about the future of the universal
    service fund. We have discussed this before, and I know the
    chairman has been interested in it. That fund was initially
    conceived of to meet rural problems, primarily Alaska problems.
    Now, I foresee a time when the universal service account will
    go down, particularly because of the enormous strains on it for
    providing Internet services to hospitals, libraries, and
    schools in areas that are not rural. That is a policy we are
    not going to change, but the revenue base for universal service
    is declining and the demands are increasing. The result may
    well be that rural America goes back to the 20th century and
    does not go forward in this century as far as the new
    technology is concerned.
        I have asked some of the major players, such as AOL and
    others, to confer with us about how to meet this challenge. One
    solution might be a tax on the Internet, which some people
    suggest. I have never supported that yet, but it may be the
    only alternative to maintain the universal service fund. If the
    fund continues to pay out the costs of connecting people to the
    Internet whose providers do not pay anything into the universal
    service fund, then it is obvious that the demise is closer
    rather than farther away.
        I would like to find some way to save the concept of an
    industry-based fund that is not a tax. That is what universal
    service was in the first place, a contribution from those who
    used the services of long distance in order to ensure that
    their calls reached all parts of the country. We have such a
    multiplicity of communications devices and concepts now. Many
    of them do not pay into the universal service fund, or if they
    do, they pay very small amounts.
        What do you think about the idea that it might be your job
    to call together a conference of people who should be providing
    contributions to those funds and see what they are willing to
    do?
        Mr. Powell. Well, I would agree that I think it is one of
    our most sacred responsibilities to try to ensure that the
    parade of concerns and horribles you have do not occur, and
    that requires a lot of tough judgments, including, just to come
    through some of the things you pointed out, really making hard
    calls between competing demands. I mean, one of the reasons we
    promote is the schools and libraries program, for example, but
    we are careful to try to rigorously keep it within control so
    that it does not further jeopardize other aspects of universal
    service which are equally valuable. I think that is the hard
    part of what we do for a living, but that is what we do and
    will continue to do.
        I think that your concerns about how will advanced
    technologies, new architectures affect the fundamental values
    of universal service--from my perspective, the first thing I
    would say is, number one, the unequivocal assertion that
    ubiquity and affordability for rural America remains a critical
    and paramount objective no matter what the architecture or the
    infrastructure is and looking for not only the traditional way
    of trying to ensure that occurs, but whether there are new and
    creative ways.
        One way, of course, always is spread the pain as widely as
    possible to ensure that no one component of that bears too
    unbearable a burden. There is no question that this is a coming
    set of serious questions in the sense that as these
    architectures move to IP and data and broadband networks, how
    we will ensure that those fundamental, ubiquitous affordability
    goals continue to go with it. And I think that the dialogue
    between some of the preeminent companies that are working in
    this area is probably useful. I would like to go back and think
    about other ways that we might at least try to be a facilitator
    of debate and evaluation of that question and see if we cannot
    at least see what kinds of problems are going to occur and what
    ways we might have a solution.
        I sort of reserve judgment on whether I think the answer
    definitely is whoever, AOL or whoever, should pay universal
    service, but one of the things I think that we have to struggle
    with is the statutes' limitation to telecommunications carriers
    as the source for funds, and that has always been an issue, as
    you know, as to whether the bucket of who you can look at is
    limited by the 1996 Act. So I think Congress would also need to
    be pretty involved in future considerations about expanding the
    revenue base.
        I also think it has been unfortunate that we, because of
    court decisions, we cannot draw on intra-State revenues to help
    supplement universal service expenses. So that is an enormous
    amount of telecommunication activity occurs intra-State and the
    decisions of courts that the statute does not permit that is
    another inroad on our ability.
        But that said, we have worked hard in the last couple years
    to reform and modify universal service that has led to net
    increases in money available to continue these goals, so I
    think that we are also taking the short-term measures. We have
    to keep that viable.

                                Hardware taxing

        Senator Stevens. Thank you for that. I hope you do it. I do
    not believe this is a tax question, although it could evolve
    into a tax question, God forbid. It will be years before we get
    another tax bill that will look into circumstances such as
    taxing the hardware that goes along with new technology. I am
    not suggesting we should. But there has to be a revenue base
    somewhere to assure that these means of communications pay
    their way in terms of assuring the message that they originate
    can be delivered anywhere: ubiquity, universality, whatever you
    want to call it.
        Unfortunately, the promise of new technology in terms of
    telecommunications, tele-education and the basic concepts of
    eliminating isolation through access to certain forms of
    entertainment and such, those are rapidly being denied to rural
    America, in my judgment. They are made available to schools,
    libraries, and health facilities, that is true. But while the
    children may have Internet in school, their parents do not have
    it at home, the local small businesses do not have it, and even
    the postmaster doesn't have it under present circumstances.
        So, somehow or other, that has got to be smoothed out. But
    this may come at a greater cost to whomever is putting up the
    money to interconnect those areas. I think that should be a
    universal service obligation, but the money is not there to do
    it.
        I would urge you to take a hand in bringing together the
    great minds of this country who are leading us into new
    generations of technology and have them commit to the
    preservation of universality as far as communications are
    concerned. Thank you, Mr. Chairman.
        Senator Hollings. Thank you, Senator Stevens.
        Chairman Powell, I had to leave for a vote, and as I was
    leaving, Senator Inouye asked you about Tauzin-Dingell. Can you
    repeat that answer again for me, please?
        Mr. Powell. It was so carefully crafted, too.

                                 Tauzin-Dingell

        Sure, Senator, I can. I began with the usual caveat of a
    regulator, which is I do not generally take a clear position on
    legislation and have not on Tauzin-Dingell and will not. But I
    pointed out to the Senator that I thought that I could give
    some articulation of what I thought was being battled over and
    what the choices were.
        It seemed to me that there are, at an intellectual level,
    there is sort of this competing vision of what competition
    should look like. That is, one vision is that real competition
    is really only going to come from different technology
    platforms competing for broadband service to customers. So the
    phone network will be one platform that will be available to
    consumers. Cable modems will be another platform. Wireless
    might eventually be a third, and maybe satellites a fourth, and
    if that were really the world or you could really achieve that
    world, then you didn't need to be as concerned about
    competitive alternatives within any one of those buckets.
        That is, even if in the worst case, every one of those
    industry segments was a monopolist, for example, just to use
    the worst case possible, they would still be competitors to
    each other so the argument would go they really aren't
    monopolists because there are four of them competing for the
    same set of customers. I think at some level, that is the
    vision that is the analytical vision that underlies the bill.
        On the other hand, there is the view that, no, it is still
    critically important to have competition from entrepreneurs and
    new entrants within a market, so that would be issues like
    interconnection with phone companies or open access in cable or
    open access in wireless and that we still need to preserve
    aggressively that level of competition, too.
        And then at the end of the day, it is sort of, like, and on
    what time frame and when, meaning how many--if you believe in
    this platform idea, how many of them do you need before you are
    comfortable the consumer is going to be served, and that is
    just a judgment that I think the members of the institution
    will have to make. But I kind of think that is what is battling
    for supremacy.
        Senator Hollings. Let me correct that answer and state very
    categorically the institution has made that decision. You see,
    I heard part of that answer as I was leaving and I said, I had
    better get back, and I was glad the other Senators were here so
    that we could get this cleared up once and for all. As an
    administrative body, you administer the law, right?
        Mr. Powell. Correct.
        Senator Hollings. In all candor, the suggestion made by
    Senator Stevens and your answer that you get them together to
    set policy as a committee, I think the authorizing committee
    ought to get us all together with your expertise, definitely,
    and experience, and get us together and see what we can do. I
    don't think the Senators should be asking the administrative
    body to corral together and set the policy.
        That being the case, what was the policy in the 1996 Act?
    You have got to get to the initiative of that particular act,
    which was by the Bell companies themselves. You are right about
    all of this bursting technology, only it did not wait until
    2001 for it to burst. It was bursting out all during the 1980s
    and the 1990s, the Internet, computerization, satellites.
        I remember a race back in the late 1970s, running for
    reelection. I went to Carolina Furnishings in Greenville, and
    talk about communications, they had an artist there that
    flashed a curtain pattern onto the satellite, down to
    Australia, and I heard the Australia fellow say he liked and
    ordered that particular curtain pattern. This has been going
    on, busting out.
        The only thing was that the best of the best, namely the
    Bell companies, had the best and still have the best of
    communications. They wanted to deregulate. They wanted to get
    into long distance and all these particular technologies. And
    so they couldn't get any financing because the market was
    indeterminate and everything else like that. Nobody would move.
    They couldn't invest in it, and there were all kinds of rumors
    about deregulation and that we had deregulated the airlines, we
    had deregulated natural gas, we had deregulated trucking.
        I had been a resister, but as the chairman of the
    committee, I started and had the original bill, S. 1822, and I
    said, all right, and they said, all right. I mean, it was a
    matter of agreement. There was never any disagreement. We
    deregulated and section 251 wasn't a question of what platform
    and everything else like that. It said, you have got to sell at
    the wholesale price, period. And so on section 251, that
    started all the little competitive CLECs. That is what started
    it.
        And they said, now we want you to open up and be totally
    deregulated, and they said, well, that is what we want. We want
    to get into long distance and all of these technologies. So we
    said, well, wait a minute, now. We do not want to mess up the
    local exchange and the services given and everything else of
    that kind. You have got a monopoly. It was created in law and
    we guaranteed you a profit and everything else like that and
    guaranteed you no competition. Now when we more or less
    guarantee you competition on what basis, not to extend your
    monopoly.
        So we said, look, you can go anywhere in the country as a
    Bell Company and get into any of the technologies you wish,
    just so long as you don't do it in your own region where you
    have got the monopoly. We just don't want to continue that. The
    whole idea was not about which platforms are going on now. The
    distinguished chairman on the House side wasn't in the room in
    all of these negotiations, and we can bring back the original
    players and everything else about the intent of Congress, but
    the intent of Congress was spelled out and you can read 271 and
    you can see the exact wording was deliberate. That was supposed
    to have happened.
        The whole initiative on the House side is based on a whole
    new technology. Data was not even considered. I can show you
    the statements made. Data was mentioned, 474 times both in the
    bill and 271, by the Senators, in the debate on the House and
    Senate side, and in the conference report, 470-some times. So,
    I mean, that whole premise of now we are going to get added
    services is a big charade, a big strawman to extend the
    monopoly.
        Now, the Commission has done a good job. They have held
    their feet to the fire. These Bells have been coming and coming
    and coming, and other than a little bit down in Texas, some in
    Kansas, some up in New York and now moving into Connecticut,
    they have found compliance. But they are the ones that brought
    the bill and questioned the constitutionality. You could see
    exactly what they intended to do was to extend their monopoly
    some 5 years ago, from 1996 up here to 2001.
        So it isn't for the Commission to decide whether there is
    enough competition in this platform and enough competition in
    that platform, no sir. It was to deregulate, period, and let
    the platforms ensue. Let them develop as they will, not to
    decide, is there enough satellite, is there enough CLECs, is
    there enough Bells, that kind of thing at all. That wasn't the
    idea. I never heard that.
        I thought I had heard a part of that going out the door,
    and I said, I had better get back--I hoped you were still
    here--so I could correct that premise. It is not a deliberative
    matter now that we ought to sit back and start considering.
    What we did is not what the choices are or what the competition
    should look like, it was whether or not we got competition and
    that was it. There is no question that as long as they think
    they have got a Commission or they have got some in Congress to
    help them extend their monopoly, they will squat. They won't
    move. They will hold on.
        They still own--of course, the CLECs have got about 8
    percent. That is what you folks have found at the Commission
    level. But actually, the ownership of that last line into the
    house, into the business, is 98 percent still owned by the
    monopoly. That is the big thing, that somehow we have got to
    get on top of and make them know. I think if they know, they
    are ready to move and to get into all the dynamism of the
    technology that you described.
        That is what they told us. They congratulated me on what we
    had done. We have got the letters and everything else like
    that. We worked around the clock. Their lawyers came in, just
    reiterated for the record on every Friday morning, and they sat
    with our staff on the Commerce Committee and it took over 4
    years to get it done. Of course, the competition, the long
    distance and others, came in every Tuesday morning. But it was
    a very deliberate thing because we know, as we know now,
    everybody has got the power to kill somebody else's bill in
    this Congress. No one has got the real power to pass. So the
    sides have got to get together.
        So we are in the favorable position. You can kill Tauzin-
    Dingell, but what I am trying to do is get you folks to
    understand the law and the intent so that these Bell companies
    will start moving, because they have been playing a sordid game
    now for 6 years, and going everywhere.
        It was amusing, when they had the Senator from North Dakota
    at the hearing before the committee the other day and the
    question was, why don't you go to North Dakota, and they said
    it was too far. I said, Buenos Aires is not too far. They said
    it was too difficult. I said, Lima, Peru, where it is in
    Spanish, is not too difficult. They are making money hand over
    fist but they are not extending. They are investing it in all
    those dynamic technologies that you see are bursting out all
    over, and they ought to be bursting out all over.
        But the kidney stone in this whole system now that must be
    passed are these Bell companies knowing and understanding that
    the law is going to be enforced, and the Commissions heretofore
    have been doing just that. We have had three different chairman
    since that time.

                         Additional committee questions

        We appreciate your appearance here this morning.
        Mr. Powell. Thank you, Senator.
        Senator Hollings. Thank you very much.
        Mr. Powell. All right. Take care.
        Senator Hollings. Yes, sir.
        [The following questions were not asked at the hearing, but
    were submitted to the Commission for response subsequent to the
    hearing:]
                Questions Submitted by Senator Daniel K. Inouye
        Question. There has been a sense in the news media, on Wall Street,
    and some segments of the industry that your market-based approach to
    regulatory policy will result in relaxed enforcement of the
    Telecommunications Act of 1996 and deregulation of Bell companies. Is
    this an accurate assumption?
        Answer. The Commission has a statutory duty to carry out the laws
    enacted by Congress fully and faithfully, and I am committed to doing
    so. I have emphasized that the Commission should vigorously enforce the
    Communications Act and Commission rules, and should do so in a prompt
    manner. The Enforcement Bureau and Common Carrier Bureau monitor both
    compliance with merger conditions and Section 271 approvals. We review,
    on a monthly basis, performance reports from each regional Bell
    Operating Company (``BOC'') that has received long distance authority
    to determine whether there has been any deterioration in performance,
    so that any ``backsliding'' can be promptly detected and remedied. I
    will remain vigilant with respect to these enforcement activities and
    will expand them where appropriate.
        To date, the Commission has found that the BOCs have opened six of
    their state markets to local competition. As I stated recently in
    connection with the Verizon Massachusetts 271 Order, the Commission
    will continue to apply the same rigor that it always has to Section 271
    applications. No BOC will receive in-region long distance authority
    until it has met or exceeded the standards set forth in Section 271
    thereby demonstrating that its local market is open to competition. I
    will continue to work vigilantly to ensure that the rules of the road
    are not only in place, but also vigorously enforced, so that consumers
    can benefit from both competitive LEC entry into the local market and
    BOC entry into the long distance market.
        Although the Commission is working hard with its existing resources
    to enforce the local competition provisions of the 1996 Act, I believe
    there is even more that we can do with the help of Congress. Currently,
    under 47 U.S.C. Sec. 503(b)(2)(B), the Commission's forfeiture
    authority for violations of the Act or Commission rules by common
    carriers is limited to $120,000 for a single violation, and $1.2
    million for a continuing violation, including inflationary adjustments.
    To enhance the deterrent effect of Commission fines and make sanctions
    more meaningful, Congress should consider increasing the forfeiture
    amount to $1 million for a single violation and $10 million for a
    continuing violation.
        Question. The broadcast industry is in the midst of its digital
    transition, and there are concerns about whether the broadcast industry
    will make this transition successfully. The FCC has a number of
    proceedings before it that relate to the digital transition. These
    include proceedings on must-carry and digital television tuners. What
    must be done, in order for the digital transition to be successful--
    that is for broadcasters to migrate their systems from analog to
    digital service, begin showing digital programming, and vacate the
    spectrum they are currently using for analog service?
        Answer. The transition to digital television is a tremendous
    undertaking, which is well under way. There are now approximately 200
    stations on the air with digital television signals. There are,
    however, a number of challenges ahead. But while the FCC has an
    important role in facilitating the transition to DTV, the most
    significant challenges are in the hands of the industries that are
    working together to launch this new service.
        As an initial matter, the FCC should continue to provide
    broadcasters with regulatory and licensing certainty. For example,
    after extensive testing and analysis, we recently re-confirmed the 8-
    VSB transmission standard. We also recently clarified the level and
    timing of service that DTV broadcasters must provide to their
    communities of license. We will continue to clarify potentially
    ambiguous requirements to ensure that the rules of the digital road are
    clear. In that regard, we have in place a DTV periodic review mechanism
    to examine issues that arise on an ongoing basis and to provide
    guidance to licensees as early as possible in the build-out process. On
    licensing matters, we have granted, and will continue to grant, all
    applications that generally conform to the DTV Table of Allotments, and
    have expedited processing for any applicant that has expressed a
    readiness and a willingness to build DTV facilities.
        In addition, there are several important issues affecting the DTV
    transition that are currently under Commission review. For instance, we
    are currently seeking public comment on the question of mandatory cable
    carriage of both the analog and digital signals during the transition.
    Similarly, the FCC has issued a notice of proposed rulemaking seeking
    comment on a requirement that certain television sets contain a tuner
    that can receive over-the-air DTV signals. There are also some
    difficult challenges to the DTV transition that are not within the
    FCC's direct jurisdiction, such as copy protection. In those areas, the
    FCC is prepared to do what it can to help facilitate agreements among
    industries and is monitoring discussions with the industries involved.
        Question. I have long been concerned about undue concentration in
    the media marketplace. Today we see the proliferation of vertically
    integrated companies that control content and distribution in a
    potentially anticompetitive manner. Some of the existing rules designed
    to guard against such anticompetitive conduct are the program access
    rules, which sunset next year. Do you believe we should allow these
    rules to sunset, or should we reinstate them for the foreseeable
    future?
        Answer. I have not yet formulated a position on whether Section
    628(c)(2)(D) of the Communications Act should be allowed to sunset or
    be extended. It is widely recognized that the program access provisions
    of the 1992 Cable Act and the Commission's implementing rules have been
    instrumental in helping new entrants such as the Direct Broadcast
    Satellite (``DBS'') companies and overbuilders compete more effectively
    with incumbent cable television operators. It is also true, however,
    that the percentage of vertically integrated program services in the
    cable television industry has declined in recent years. For example,
    between 1994 and 2000, while the total number of nationally distributed
    cable networks increased from 106 to 281, the proportion of these
    networks affiliated with one or more cable television operators
    actually declined from 53 percent to 35 percent.
        Question. In January of this year, the D.C. Circuit Court struck
    down the FCC's EEO rules as unconstitutional. The FCC then petitioned
    the D.C. Circuit Court for rehearing. However, this month the court
    denied the FCC's petition for rehearing. In light of these court
    decisions, what action can the FCC take to foster entry of minorities
    and women into the broadcast industry?
        Answer. I have consistently supported EEO rules that prohibit
    discrimination by FCC licensees. If the public interest means anything
    at all, it means that those who hold a government license may not
    discriminate against the citizens from whom the license ultimately is
    derived. As my voting record shows, I favor EEO rules that prohibit
    discrimination and require broad outreach in a race and gender neutral
    manner. In my view this is the only judicially sustainable way to
    ensure that all Americans, including minorities and women, have access
    to opportunities in the communications field. In this regard, I plan to
    ask my colleagues to work with me to develop a notice of proposed
    rulemaking aimed at putting such rules in place.
        Question. Media consolidation is of great concern to me. I have
    been troubled by some of your comments that ownership caps are based on
    ``romantic notions.'' Although the level of consolidation in the media
    industry in the marketplace today may not rise to the level of a
    violation of our antitrust laws, it nonetheless may have an adverse
    impact on such public interest objectives as diversity of ownership,
    diversity of voices, and localism. Can you assure this committee that
    you intend to work to honor these public interest objectives?
        Answer. I am firmly committed to honoring all the public interest
    tenets of the Communications Act, including the long-standing
    objectives of promoting diversity and localism. I believe that, as the
    federal agency that regulates the communications industry, we have an
    obligation to ensure that the citizens of this nation have access to
    diverse viewpoints on matters, local and national, that affect their
    lives. I also recognize that the best way to fulfill that obligation
    may change over time. Congress also recognized this when it enacted
    Section 202(h) of the Telecommunications Act of 1996. I take seriously
    the statutory duty embodied in that provision to examine our ownership
    rules biennially in light of competitive changes to these industries,
    and I intend to carry out that duty faithfully. I can assure you that
    any modifications we may make to our ownership rules will only be made
    after a thorough and rigorous review of the impact of those
    modifications on the public interest.
        Question. There has been substantial discussion about ways to
    accelerate the deployment of broadband or high speed data service.
    However, in Indian country, the rate of telephone penetration still
    lags noticeably below that of the general population. What can be done
    to ensure that the nation's Indian population is able to obtain the
    same telephone and broadband communications options that are available
    in other parts of the country?
        Answer. The Commission has taken several important steps to
    facilitate the provision of telecommunications service to individuals
    on tribal lands, including: (1) the Tribal Universal Service Order; (2)
    the Tribal Wireless Services Order; (3) initiation of the Indian
    Telecommunications Training Initiative (``ITTI''); and (4)
    establishment of a Tribal Government Liaison.
        In June 2000, the Commission adopted universal service measures to
    promote telecommunications subscribership and infrastructure deployment
    within American Indian and Alaska Native tribal communities, which, on
    average, have the lowest reported telephone subscribership levels in
    the country. For example, the Tribal Universal Service Order (FCC 00-
    208) modified the Commission's universal service rules in order to
    target universal service support to low-income subscribers living on
    tribal lands by: (1) increasing the Lifeline program discount to bring
    monthly telephone costs down to as little as $1 per month; (2)
    increasing the Link Up program discount to provide up to $100 off
    initial telephone installation costs; and (3) broadening the
    qualification criteria for Lifeline and Link Up to increase the number
    of low-income subscribers on tribal lands.
        In the Tribal Wireless Services Order (FCC 00-209), the Commission
    adopted rules and policies to provide incentives for wireless
    telecommunications carriers to serve individuals living on tribal
    lands. The Commission expanded its policies to make bidding credits
    available to winning bidders who use their licenses to deploy
    facilities and provide service to federally recognized tribal lands
    that have a telephone penetration rate equal to or below 70 percent. At
    present, the Commission is considering modifications to the rules
    guiding bidding credits, including: (1) expansion of the bidding
    program to tribal areas with penetration rates above 70 percent, but
    significantly below the national average; and (2) extending credits to
    licensees that enter into partitioning agreements with tribal
    authorities to allow the tribal government or a third-party carrier to
    provide service.
        The Commission also initiated the Indian Telecommunications
    Training Initiative (``ITTI'') last year to facilitate the deployment
    of telecommunications services at reasonable rates to all Indians
    living on federally recognized tribal lands by providing educational
    and networking opportunities to Indian tribal governments and
    telecommunications industry leaders. The first conference, held in
    September 2000, attracted representatives from 135 tribes, some of
    which have since reported successful experiences in advancing
    telecommunications deployment. More recently, in June of this year, an
    ITTI industry conference provided intercultural training and
    information on doing business with Indian tribes for equipment
    manufacturers and service providers. The second ITTI national
    conference will be held in September of this year, with expected
    attendance between 600 and 1,000 people.
        In addition, for the past three years, the Commission has
    designated a Tribal Government Liaison to consult with tribal entities
    about specific measures that will assist the Commission in improving
    telecommunications service to Indian Country. This Liaison coordinates
    across Commission Bureaus and Offices on various forms of outreach to
    tribal entities and on matters that involve questions of federal Indian
    law and policy. The Liaison serves as an initial point of contact for
    tribes and a support resource for Commission staff.
        With respect to advanced services, the Commission conducts an
    annual Section 706 Inquiry to determine whether advanced
    telecommunications capabilities are being deployed to all Americans in
    a reasonable and timely manner. Last year, we committed to monitoring
    closely the deployment of these services, especially to areas of the
    country that might be particularly vulnerable to not receiving timely
    access, such as tribal territories.
        Through a combination of efforts--including the Indian Training
    Initiative, our Tribal Government Liaison, and our universal service
    and Section 706 proceedings--I am confident that we will be able to
    find creative ways to address the telecommunications needs of this
    nation's Indian population.
        Question. The territories of American Samoa, Guam and the
    Commonwealth of the Northern Marianas Islands, despite paying into the
    universal service fund, have not been able to benefit from the
    universal service, Rural Health Care program.
        The Rural Health Care Program establishes discounts based on a
    comparison of rural and urban telecommunication rates, with a theory
    that those in rural areas should pay the same amount for equivalent
    service as those in urban areas. This is problematic for the Pacific
    Insular areas due to the designation of their ``urban areas.'' While
    the urban area is usually defined around a city with a population of
    50,000, the FCC designated the ``urban city'' for these Pacific Insular
    areas to be Pago Pago for American Samoa, Agana for Guam, and Garrapan
    for the Commonwealth of the Northern Marianas Islands. None of these
    cities have a population of 50,000. In fact, the populations of these
    cities are less than 10,000.
        The FCC, to its credit, recognized that the Pacific Insular Areas
    might be at a disadvantage and in September 1999, issued a docket for a
    proposed rulemaking change (FCC Docket 96-45). To my knowledge the
    responses to the FCC docket were all positive in support of the
    redefinition of the urban area.
        Given the great need in the Pacific Insular areas and the positive
    comments to the proposed rulemaking, I hope that you would agree that
    it would be reasonable for the FCC to re-designate the urban areas to
    be either Honolulu or ``the closest urban city with a population of
    more than 50,000 that has a medical school and advanced medical
    facilities.''
        Answer. I believe that the Rural Healthcare Program is critical to
    the goal of bringing the advances of medical science to underserved
    areas through the use of telecommunications. I intend to explore ways
    to more fully utilize the funds that have been set aside for this
    program. Specifically, I appreciate your concern that the Commission's
    current definition of urban area with respect to the Pacific Island
    jurisdictions does not enable health care providers in these
    jurisdictions to be connected to a major urban center. With the
    addition of our new Commissioners, I intend to review this matter
    expeditiously.
        Question. The House Energy and Commerce Committee conducted a
    hearing two weeks ago regarding the E911 Phase 2 implementation. I
    believe a point made at the hearing was that a ``one size fits all''
    solution would have a disproportionately negative impact upon wireless
    carriers serving rural America than upon those serving urban America.
    Moreover, although I am committed to implementing Phase 2 as soon as
    possible, I am told that many rural carriers are finding the
    implementation schedule set by the Commission to be daunting due in
    large part to the lack of equipment needed to comply with Commission
    mandates.
        Mr. Chairman, have you discussed enforcement options and
    ramification of such potential actions with your Enforcement Bureau?
        Is the Commission going to fully take into account the unique needs
    of carriers serving rural America prior to taking any enforcement-
    related actions, especially those who have filed Phase 2 waiver
    requests?
        Answer. I have met with the Chiefs of both the Enforcement and
    Wireless Telecommunications Bureaus to discuss E911 implementation and
    enforcement. Because full E911 implementation is an important public
    safety goal, we will not hesitate to take whatever enforcement action
    is warranted in cases where carriers fail to comply with the
    Commission's E911 requirements for both Phase 1 and Phase 2
    implementation. Such enforcement action could be taken in response to a
    complaint or at the initiation of the Enforcement Bureau.
        We are also sensitive to the special challenges faced by rural
    carriers. Thus, carriers have the opportunity, before any enforcement
    action is taken, to bring to the Commission's attention all factors
    that they feel mitigate--in part or in full--any sanction. Prior to any
    action, we would take all such factors into account, including any
    unique problems encountered by carriers serving rural America.
        Question. Mr. Chairman, I want to thank you for responding to a
    letter I wrote to you regarding the Northpoint matter. I was pleased to
    learn that the FCC is working expeditiously so that MVDDS (multichannel
    video distribution and data service) will be licensed and deployed.
        Hawaii gets second-class DBS service compared to the 48 continental
    states, but we are hardly alone in not being able to get local channels
    via satellite. Clearly, a new terrestrial-based multi-channel provider
    will help Hawaii, as well as rural America.
        What is the status of the FCC's efforts and when can we expect the
    FCC to issue a license?
        Answer. The 12.2-12.7 GHz proceeding is one of the most complex
    allocation proceedings before the Commission. Three services could
    potentially occupy this spectrum in a complex sharing arrangement that
    involves Direct Broadcast Satellite service (``DBS''), Non-
    Geostationary (``NGSO'') satellites, and terrestrial users, such as
    Northpoint (as part of a new terrestrial fixed Multichannel Video
    Distribution and Data Service (``MVDDS'')).
        Several matters affect the Commission's ability to address these
    applications. For example, Section 1012 of the ``District of Columbia
    Appropriations Act, 2001,'' requires the Commission to provide for
    independent testing for interference potential of any terrestrial
    service technology proposing to use the direct broadcast satellite
    frequency band (12.2-12.7 GHz). This requirement, to ensure that the
    technical interference considerations have been fully vetted and
    considered, has been an extraordinary undertaking. The independent
    tester, MITRE Corp., subsequently completed the required interference
    study and submitted its report to the Commission on April 18, 2001. The
    Commission placed the report on public notice on April 23, 2001, and
    sought comment on the report. Comments responsive to the study were due
    on May 15, 2001, and replies were due on May 23, 2001. The Commission's
    engineers are currently in the process of finalizing their evaluation
    of the engineering questions for the purpose of making a sound judgment
    about technical interference.
        Another set of issues we have to work through that are just as
    significant as the technical interference question arise from the
    different regulatory schemes applicable to wireless land-based and
    satellite-based services. Because, as noted above, three services could
    potentially use this spectrum, the Commission must determine the
    applicability of the distinct statutory frameworks that are used to
    license spectrum for domestic and international satellite services as
    well as terrestrial services. The Balanced Budget Act of 1997 requires
    the Commission to license by competitive bidding spectrum for which
    mutually exclusive applications are accepted for filing, unless an
    exemption applies. On the other hand, the Orbit Act does not allow the
    Commission to use competitive bidding to license spectrum used for the
    provision of international or global satellite communications services.
    Thus, the use of the spectrum for multiple types of services presents
    novel issues.
        Because of these complexities, this proceeding has been especially
    difficult to resolve. The Commission is working expeditiously in this
    regard and plans to act on a Further Notice of Proposed Rule Making to
    establish licensing, technical, and service rules for MVDDS no later
    than the end of this year, and--subject to the nature of any petitions
    for reconsideration of the rule making proceeding--then expects to
    commence with the licensing process.
                                     ______

                    Questions Submitted by Senator Herb Kohl
                     fcc reform and the ``shot clock'' bill
        Question. Chairman Powell, you've repeatedly said that you want to
    streamline the FCC's internal operations. In fact, you've been quoted
    as saying that the ``most important'' goal of the Commission under your
    watch is to make the FCC an ``efficient, well-managed and decisive''
    organization. We encourage this sort of reform, though you've got a
    daunting task on your hands.
        As you know, we've been particularly interested in speeding up the
    license transfer review process at the FCC. The ``shot clock''
    legislation that we introduced last Congress would have imposed
    deadlines upon the Commission's review. You've said you want to speed
    up to the merger review process, but that ``prophylactic'' time limits
    were not needed. We hope you're right.
        What's your plan? What will you do as Chairman to expedite FCC
    merger review? For example, do you plan to continue the work of the
    ``Transaction Team'' initiated by your predecessor, Chairman Kennard?
        Answer. As you are aware, I have commenced a full review of the way
    the Commission operates with a view towards improving efficiency and
    making the Commission more responsive to the needs of the fast-changing
    industries that it regulates. The way that license transfer
    applications, including mergers, are processed is part of that review.
        Most license transfer applications, and most mergers, do not
    present difficult or complex issues and can be processed quickly. At
    the Commission meeting on July 12, we issued a Notice of Proposed
    Rulemaking to streamline certain actions on applications to transfer
    control of authorizations to provide domestic telephone service under
    Section 214 of the Act. On the other hand, some mergers present complex
    legal and factual issues that require careful and thorough
    consideration. I believe that active case management and avoiding
    duplication of the work of other agencies and departments of government
    is the best way to ensure timely disposition of these cases. To this
    end, the Transaction Team continues to play an important role as an
    active coordinator of the Commission's effort in merger review. I am
    confident that its timely involvement in major transactions will have a
    beneficial effect in expediting the merger review process.
                             caribbean phone scams
        Question. Mr. Chairman, let's turn to an issue that may not be
    making the headlines, but one that is important to American consumers.
    As you know, 20 new area codes were created for the Caribbean in 1999.
    Though these numbers are international toll calls, they can be dialed
    as easily as any other long distance call in this country. What's worse
    is that a few unscrupulous characters--con artists--have devised
    schemes to fraudulently lure Americans to call these international
    numbers. They get people to call these numbers with real bottom-of-the-
    barrel tactics--telling people they need to call to receive information
    of an injured loved one, to avoid a lawsuit, or to accept a luxurious
    prize or vacation. Of course, the consumer doesn't realize she is
    calling an international phone number until the increased charges
    appear on the phone bill. These scam artists need to be put out of
    business.
        Chairman Powell, I have an idea that would put an end to these
    ``international calling scams'' and I'd like your input. We are
    considering drafting legislation that would require a notification to
    the caller before an international call is connected. For example, say
    you dial an international number--intentionally or by accident. Before
    the call begins to ring, you would hear a simple, short notification
    that you are dialing an international phone number that may incur
    higher rates. What do you think of that idea, both as a way to prevent
    these scams and as a pro-consumer measure?
        Answer. I applaud your goal. We at the Commission are aware of and
    are also concerned about these scams, and we encourage consumers to
    contact our Consumer Information Bureau and to use our informal
    complaint procedure. When consumers send a complaint to us we forward
    it to the relevant carrier and that carrier is required to respond to
    us, and the consumer, in a limited amount of time. We have had a lot of
    success resolving complaints to consumers' satisfaction using this
    process. I should mention, though, that out of the tens of thousands of
    complaints we received in the last twelve months concerning telephone
    issues only approximately one hundred touched on this issue. As to the
    idea of mandating notifications on all international calls, I believe
    there may be value in consulting with industry. Carriers are in the
    best position to provide information on how such notification might be
    done, whether all 2,600 providers of long distance service would need
    to participate, the costs that would be imposed on carriers, and
    whether those costs would increase rates for consumers.
                            universal service reform
        Question. The Commission recently dealt with some difficult issues
    regarding smaller telephone companies. You are to be commended for
    approving the Rural Task Force Proposal in which many of my
    constituents participated. As you are well aware, the solvency and
    vitality of the Universal Service Fund is very important to the
    ratepayers of Wisconsin.
        What are your views on additional proposals and policy suggestions
    aimed toward guaranteeing the solvency of the Fund? For example, would
    you include an initiative to expand the base of the Fund and if so,
    what services would you cover with a larger Fund?
        Answer. The solvency of the Universal Service Fund is of great
    concern to me, especially in light of recent changes in the
    telecommunications marketplace. As you know, Section 254 of the
    Communications Act mandates that only telecommunications carriers that
    provide interstate service shall contribute to universal service.
    Although universal service support programs have grown, growth in
    interstate industry revenues--the contribution revenue base--has not
    kept pace with program growth. Accordingly, the Commission recently
    initiated a proceeding to streamline and improve the universal service
    contribution system. Among other things, the Commission sought comment
    on ways to expand the contribution base, including, for example,
    whether carriers should contribute on a flat-rate basis rather than
    contributing a percentage of their interstate revenues.
        The Commission also recently initiated a proceeding to review the
    list of services supported by federal universal service. The Commission
    has asked the Federal-State Joint Board on Universal Service to review
    the definition of the core services supported by universal service,
    including whether to include intrastate or interstate toll services,
    expanded area service, and prepaid calling plans.
                                     ______

                Questions Submitted by Senator Pete V. Domenici
        Question. Chairman Powell, I am pleased to welcome you to this
    Subcommittee.
        As you know, New Mexico is a large, sparsely populated rural state.
        As such, translators are of immense importance to the people of my
    state. In fact, one-third to one-half of New Mexico's population rely
    on translators to bring television broadcasts to their homes.
        The statutorily mandated conversion from analog to digital
    television requires new digital translators to be acquired and
    sufficient spectrum to translate digital signals.
        Recognizing that translators represent the only source of free,
    over-the-air broadcasting capability to rural areas, what is the FCC's
    plan for digital translator service to those regions? If no such plan
    has been initiated, when could we expect the Commission to act on this
    important issue?
        Answer. In January of this year in the DTV Periodic Review, the
    Commission recognized the need for a proceeding to address fundamental
    issues regarding authorization and protection of DTV booster, DTV
    translator and digital Low Power Television stations. The Commission
    has authorized experiments for digital translators to further evaluate
    the feasibility of this service. Those experiments are now being
    conducted in Utah and some of the initial indications have been
    encouraging. We expect to have a final report on the results of the
    experiments early next year.
        Question. The FCC has stated that delivery of broadband internet
    access is particularly slow in rural and minority communities.
    ``Rural'' and ``minority'' define much of New Mexico.
        I understand that deploying these services is a business decision
    rooted in profit maximization and that some companies focus investment
    on denser population centers, rather than rural America.
        Yet, I am researching options to ensure that rural America, like my
    state of New Mexico, may have the same level of services as our biggest
    cities.
        I applaud those companies who invest in rural America and look
    forward to working with them. I am also interested in new technologies
    that focus on rural and underserved areas.
        Satellite technology that provides high speed broadband service is
    one such innovation. Yet, I am troubled by reports that certain
    companies horde orbital licenses without developing and deploying
    satellites when other companies are prepared to bring such services to
    rural areas but lack the requisite licenses.
        It is my understanding that when the FCC originally assigned
    licenses in May 1997 it waived its anti-warehousing rules but said it
    would, instead, strictly enforce milestones to ensure the utilization
    of slots.
        Has this approach been effective in requiring first-round licensees
    to deploy their satellites or return their licenses ensuring
    competition in rural markets for high-speed data services via
    satellite?
        Answer. The enforcement of milestones has been very effective in
    ensuring competition and the use of valuable orbit and spectrum
    resources. By way of clarification, however, we note that the
    Commission did not waive its ``anti-warehousing'' rules in assigning
    licenses in the first processing round for Ka-band satellite systems.
    Rather, the Commission waived its financial requirements. Generally,
    the application of this rule prevents underfinanced applicants from
    holding spectrum while attempting to procure financing to the detriment
    of qualified applicants ready to go forward. However, because there
    were sufficient orbital locations available to accommodate all
    applicants, with additional locations left over, the Commission
    determined that authorizing all of the first round systems would not
    prevent any applicants from using this spectrum. To ensure orbit and
    spectrum resources did not go unused, the Commission stated that it
    would enforce system milestone schedules.
        Last year, the Commission demonstrated its commitment to enforcing
    milestones when it revoked the authorizations of three Ka-band
    licensees for failure to meet their construction commencement
    milestones. Although the Commission subsequently reinstated the license
    of one company for good cause, as a result of these revocations orbital
    locations that would not have otherwise been utilized are available for
    applicants in the second Ka-band processing round. Thus, it appears
    that all of the second round applicants may be accommodated. The entry
    of new licensees will expand and improve the variety of advanced
    communications services to the United States, including rural and
    underserved areas. The Commission will continue to monitor all
    licensees for compliance and enforce its milestones as necessary.
        Question. I strongly support competition in business. Competition
    gives consumers better products, optimal service, and better prices.
        As you know, some mobile telephone companies claim that they
    require more spectrum in order to provide additional services. Spectrum
    is a public commodity that the FCC is charged with managing and
    licensing.
        Recognizing the virtues of competition, the revenue generated
    through spectrum auctions, and the consumer's interest in diverse
    products and services;
        Should incumbent spectrum licensees demonstrate that they are using
    spectrum before they are given more?
        Answer. A requirement that incumbent licensees demonstrate that
    they are using spectrum before they are given more may be more
    effective in some areas than in others. The Commission, for example,
    has rules for some non-commercial wireless services (e.g., private land
    mobile, non-commercial microwave, maritime) that require licensees to
    demonstrate they are adequately using their current spectrum holdings
    before applying for more spectrum. These non-commercial licenses, which
    are not awarded through competitive bidding, tend for be for smaller
    amounts of spectrum than those licenses awarded through competitive
    bidding. These licenses also are not generally used for wide-area
    systems and often have various eligibility and operational
    restrictions.
        On the other hand, the Commission does not require commercial
    mobile wireless providers to utilize all of their currently held
    spectrum before acquiring more spectrum. In the commercial context, we
    believe there is a need to maintain some additional licensing
    flexibility that permits licensees to some extent to aggregate their
    spectrum holdings to accommodate spectrum-intensive advanced
    telecommunications services. In these circumstances, we have used other
    types of safeguards. The Commission maintains performance requirements
    for commercial mobile providers, as directed by the Congress.
    Commercial licensees must meet specified coverage requirements or
    demonstrate substantial service at certain periods within their license
    terms. The Commission monitors implementation of these rules to ensure
    that they are meeting the goals set forth by statute or public policy
    and will readdress them as conditions warrant. Moreover, increasingly,
    market conditions provide strong incentives for licensees to use
    spectrum allocated to them, especially as the number of commercial
    mobile telephone service providers continues to grow. The Commission's
    latest report on this industry--The Sixth Annual Commercial Mobile
    Radio Service (``CMRS'') Competition Report--estimates that 91 percent
    of the U.S. population lives in counties with some level of mobile
    telephone service by three or more distinct providers, while 75 percent
    live in counties with five or more providers. These carriers are
    finding that, in order to remain competitive, they must offer a larger
    variety of services at better prices, and, it is estimated that the
    move towards third generation (``3G'') high-speed mobile data and voice
    service will only increase this competition.
        The Commission will continue to monitor closely both marketplace
    and policy incentives to ensure that the spectrum is used efficiently,
    whether for public safety, private or commercial purposes, and will
    monitor their effectiveness in helping to ensure spectrum efficiency.
                       SECURITIES AND EXCHANGE COMMISSION

    STATEMENT OF LAURA SIMONE UNGER, ACTING CHAIRMAN

                      summary statement of Chairman Unger

        Senator Hollings. Chairman Unger, will you please come
    forward. Chairman Unger, we welcome you to the committee and we
    would be delighted to hear from you at this time.
        Ms. Unger. Thank you very much, Chairman Hollings. I think
    I now know what to say about competition, should that issue
    arise during the course of my testimony today.
        But I appreciate the opportunity to testify today on behalf
    of the Securities and Exchange Commission in support of the
    President's fiscal year 2002 budget request. As I am sure you
    know the SEC today faces some of the most complex and difficult
    issues it has ever considered.
        At the same time, more Americans invest in our securities
    markets than ever before. Twenty years ago, only 5.7 percent of
    Americans owned mutual funds. Today, some 88 million
    shareholders representing 51 percent of U.S. households hold
    $7.4 trillion in mutual funds. This exceeds by about $4
    trillion the amount on deposit at commercial banks and
    surpasses by $2 trillion the total financial assets of
    commercial banks.
        At the same time, our markets continue to be transformed by
    the rapid pace of technological change in recent years. New
    technologies, new market entrants, and new financial products
    are reshaping our markets. For example, electronic trading
    platforms, some of which didn't exist just a few years ago, are
    now matching buyers and sellers of hundreds of millions of
    shares every day, anonymously, and for fractions of a penny a
    share.
        Consider also emerging new products. The QQQ, which the
    industry calls Cubes, is an index product that tracks the
    Nasdaq 100 and didn't exist 2 years ago. Yesterday, it traded
    almost 53 million shares, which is more shares than were traded
    in Microsoft, GE, and IBM combined.
        No less important, our markets today are increasingly
    global, a trend that most people expect to accelerate in the
    coming years. Globalization, as you might expect, affects
    almost every aspect of the SEC's work. We must be able to
    regulate our markets without boundaries and investigate and
    prosecute securities fraud irrespective of where that conduct
    originated.
        All of these developments raise complex and critically
    important challenges that the SEC must be prepared to meet. At
    the same time that our markets are undergoing such dramatic
    changes, the SEC is struggling to keep pace. With approximately
    3,000 staff, the SEC is a small Federal agency, but the
    industry we oversee grows daily and includes nearly 700,000
    registered representatives employed by 8,000 broker-dealers,
    some 15,000 companies that file reports with us, some 30,000
    investment company portfolios, and almost 8,000 registered
    investment advisors. Over $41 trillion in stocks are expected
    to trade hands this year on the exchanges and Nasdaq.
        Against this backdrop, the President's fiscal year 2002
    budget requests an appropriation of $437.9 million for the SEC.
    This is only 3.6 percent more than our fiscal year 2001 enacted
    level of $422.8 million. The $437.9 million request provides
    the resources necessary to meet most of the Commission's needs.
    It is a zero-growth budget that funds all but $5.2 million of
    the Commission's cost increases with no programmatic staffing
    increases.
        We support this request. Ironically, though, we can manage
    at this level only because of the severe staffing problems that
    we face. In the last 3 years, more than 1,000 SEC employees,
    nearly one-third of the agency's staff, have left the
    Commission, which is a rate nearly double the Government
    average. Not only do we lose too many employees, but we also
    struggle to find qualified people willing to work for the
    salary and benefits we offer.
        Over the last several months, the SEC consistently has had
    about 280 vacant positions, amounting to almost 9 percent of
    our hiring ceiling. Because filling open positions has proven
    to be so difficult, we intend to use the staffing funds to
    cover some of the mandatory costs for fiscal year 2002.
    However, constraining the SEC's growth and relying on cutting
    unfilled positions is not sustainable over the long term.
        In the coming years, I do believe the SEC will need
    staffing increases to meet the challenges that I described
    earlier. In addition, the staffing increases will be needed to
    meet our increasingly complex regulatory responsibilities under
    the Gramm-Leach-Bliley Act and the Commodities Futures
    Modernization Act of 2000.
        Finally, as you know, both the House and Senate have passed
    legislation that would, among other things, give the SEC the
    ability to grant and match the pay of our sister regulators at
    the Federal banking agencies, known as pay parity. While the
    SEC economists, lawyers, accountants, and examiners perform
    many of the same duties and responsibilities and functions as
    the bank regulators, and we often work side by side with them,
    the staff at the Federal banking agencies make anywhere from 25
    to 40 percent more than the SEC staff, their counterparts at
    the SEC. This pay disparity has been a significant drain on
    morale and has perpetuated the staffing crisis that has
    threatened to hamper the agency's effectiveness.
        As you know, the SEC, our Congressional oversight
    committees, the securities industry, and the corporate
    community have all been strong supporters of pay parity. Pay
    parity is important for investors, the securities industry, and
    for our markets. I do hope this critical legislation will be
    enacted soon and passed in conference in the near future. In
    the event that pay parity is enacted during this session, the
    full funding for our new pay scale would require additional
    funds beyond our current request.

                               prepared statement

        I appreciate the opportunity to appear here today and
    request that my written statement be included in the record.
        Senator Hollings. It will be included.
        [The statement follows:]
                      Prepared Statement of Laura S. Unger
        Chairman Hollings, Ranking Member Gregg, and Members of the
    Subcommittee: I appreciate this opportunity to testify on behalf of the
    Securities and Exchange Commission (``SEC'' or ``Commission'') in
    support of the SEC's fiscal 2002 budget. The SEC is a civil law
    enforcement agency. Since its creation in 1934, the SEC's mission has
    been to administer and enforce the federal securities laws in order to
    protect investors, and to maintain fair, honest, and efficient markets.
    We accomplish this mission by overseeing the markets through a public-
    private partnership. This system of shared regulation among the SEC,
    state regulators, self-regulatory organizations (``SROs''), and the
    securities industry enables the Commission to leverage its resources
    and is markedly different from the approach taken by other federal
    regulators. Even with this system, however, the SEC must stretch to
    keep pace with the rapidly changing marketplace.
        The Commission today faces some of the most complex and difficult
    issues it has ever considered. No segment of American business has been
    more transformed by the rapid pace of technological innovation in
    recent years than the securities industry. New technologies, new
    participants, and new financial products are reshaping our markets. Our
    markets also are becoming increasingly global--a trend that most expect
    to accelerate in the coming years. In addition, our national securities
    markets are taking steps to shed their long-held membership status and
    are moving to become publicly held entities. In short, it is now more
    important than ever that the SEC remain vigilant in policing and
    maintaining the integrity and transparency of our securities markets.
        We are a nation of investors. Twenty years ago, only 5.7 percent of
    Americans owned mutual funds. Today, some 88 million shareholders,
    representing 51 percent of U.S. households, hold mutual funds. Our
    nation's investors have an unprecedented stake in our markets. Whether
    through college savings plans or retirement accounts, our collective
    stake in U.S. markets continues to grow, and we are increasingly
    dependent on the success and integrity of those markets. In addition,
    online trading and new technologies have empowered individual investors
    in ways that were previously unimaginable. It is against this backdrop
    that I intend to discuss the President's fiscal 2002 budget request for
    the SEC and the primary challenge we currently face: our inability to
    attract and retain staff.
        The President's fiscal 2002 budget requests an appropriation of
    $437.9 million for the SEC, 3.6 percent more than our fiscal 2001
    enacted level of $422.8 million. This $437.9 million request, while
    providing the resources necessary to meet the Commission's current
    needs, is a zero-growth budget. It only partially funds the
    Commission's inflationary and mandatory cost increases, does not
    provide any programmatic staffing increases, and actually requires the
    Commission to make a small reduction in its authorized staff level.
        We intend to support the Administration and meet the challenges
    ahead by continuing to use our existing resources as efficiently and
    effectively as possible. Unfortunately, and perhaps ironically, we only
    have the ability to operate at this funding level because of the severe
    staffing problems we currently face. In particular, our inability to
    pay staff at a level comparable with the other federal financial
    regulatory agencies has hampered our ability to attract and retain
    staff. The resulting high turnover that we have experienced has
    resulted in a significant efficiency loss and has left certain
    positions unfilled indefinitely. Because filling these positions has
    proven to be so difficult, we intend to fund some of our mandatory
    costs by making reductions in the number of vacancies that we will fill
    in fiscal 2002. However, constraining the SEC's growth and relying on
    cutting unfilled positions is not preferred and certainly is not
    sustainable over the long term.
        The SEC will need significant additional resources in fiscal 2003
    and beyond to respond to both the continuing innovations in our markets
    and the increasing regulatory responsibilities we face as a result of
    several recent legislative initiatives. In particular, we will require
    additional examination and oversight staff to meet our new
    responsibilities under the recently enacted Commodities Futures
    Modernization Act of 2000 (``CFMA''), which provides for joint
    oversight with the Commodities Futures Trading Commission of new
    security futures products, and the landmark Gramm-Leach-Bliley Act
    (``GLBA'').
        In addition, the SEC critically needs to stay abreast of the rapid
    evolution of our securities markets. New markets and new trading models
    are constantly emerging. Electronic trading platforms--some of which
    didn't exist just a few years ago--are now anonymously matching buyers
    and sellers of hundreds of millions of shares every day. In February of
    last year, the Commission approved the International Securities
    Exchange's application to become the first new national securities
    exchange in twenty-seven years. Now, four entities have applied for
    registration as an exchange. At the same time, the traditional exchange
    and over-the-counter markets continue to innovate. Both the New York
    Stock Exchange and Nasdaq are in the process of incorporating greater
    automation into their markets, launching complex and important
    initiatives such as NYSE Direct and the SuperMontage.
        No less pressing is our need to keep up with the challenges
    presented by today's increasingly global marketplace. Companies
    throughout the world are now seeking capital on a cross-border basis.
    In addition, U.S. investors today can view real-time quotes from
    foreign markets, and electronic linkages reduce the costs to U.S.
    investors of trading directly in foreign markets. These developments
    make it increasingly important for the SEC to promote high quality
    disclosure and transparency standards, including high quality
    internationally acceptable accounting standards.
        Despite these long-term needs, our fiscal 2002 request will allow
    the Commission to continue such important initiatives as:
      --combating the rise in Internet and financial reporting fraud;
      --overseeing the securities industry's automation changes in
            connection with the transition to a T+1 settlement system;
      --maintaining our formal inspection cycle program for the increasing
            number of alternative trading systems;
      --updating and improving prospectus requirements for variable
            insurance products;
      --developing a tailored disclosure document for unit investment
            trusts; and
      --addressing developments in domestic and international accounting
            and auditing matters.
        Having outlined our ongoing priorities and how we intend to manage
    the funding level approved in the President's budget, I would now like
    to discuss the Commission's severe difficulties in attracting and
    retaining qualified staff and the status of our pay parity effort.
                                staffing crisis
        On June 14, 2001, the House of Representatives voted 404 to 22 in
    favor of H.R. 1088, the Investor and Capital Markets Relief Act, the
    companion to S. 143, the Competitive Market Supervision Act of 2001,
    which the Senate passed by unanimous consent earlier this year. Both of
    these bills would provide the SEC with the authority necessary to match
    the pay and benefits of federal banking agencies. We currently believe
    that this legislation will be enacted prior to the start of fiscal 2002
    on October 1, 2001. As such, I would like to take this opportunity to
    review the SEC's current staffing crisis and to discuss the additional
    resources that we will need to implement pay parity.
        As a result of Congress's passage of the Financial Institutions
    Reform, Recovery and Enforcement Act (FIRREA) in 1989, none of the
    federal banking regulators is subject to the government-wide pay
    schedule. As a result, they are able to provide their staffs with
    appreciably more in compensation and benefits than we can. This
    disparity is a significant drain on morale. It is difficult to explain
    to SEC staff why they should not be paid at comparable levels,
    especially when they are conducting similar oversight, regulatory, and
    examination activities. It is one thing for staff to make salary
    comparisons with the private sector, but quite another for them to see
    their government counterparts making substantially more than they are.
        This is particularly true in the wake of the landmark GLBA
    mentioned above. The GLBA demands that the Commission undertake
    examinations and inspections of highly complex financial services
    firms. Moreover, by allowing additional affiliations between securities
    firms, banks, and insurance companies, the GLBA requires increased
    coordination of activities among all the financial regulators. Even
    more so than in the past, Commission staff are working side-by-side
    with their counterparts from the banking regulatory agencies, including
    the Federal Reserve, the Office of the Comptroller of the Currency, and
    the Federal Deposit Insurance Corporation. However, we cannot match the
    salaries that our sister regulators pay.
        I appreciate the continued support of our authorizing and
    appropriating committees and their recognition that pay parity is good
    public policy. With approximately 3,000 staff, the SEC is small by
    federal agency standards. This staff is charged with overseeing an
    industry that includes about 700,000 registered representatives of
    approximately 8,000 broker-dealers, some 15,000 companies that file
    reports with us, about 30,000 investment company portfolios, and about
    8,000 registered investment advisers. Over $41 trillion in stocks are
    expected to trade hands this year on the nation's stock exchanges and
    Nasdaq, including transactions on numerous new electronic communication
    networks. Mutual funds now hold close to $7 trillion in assets. This is
    more than double the amount on deposit at commercial banks and
    surpasses by $2 trillion the total financial assets of commercial
    banks. Unlike bank deposits, however, mutual fund assets are uninsured
    and no SROs help us regulate this sector. Social security reform
    initiatives also raise the possibility of greatly increasing the number
    of American's invested in our capital markets.
        With such important responsibilities and at such a critical time in
    our markets' development, the Commission simply cannot afford to
    continue to suffer a serious staffing crisis. Since 1996, our attrition
    rate has been increasing, particularly among our more senior
    professionals. Over the last two fiscal years, the Commission has lost
    30 percent of its attorneys, accountants, and examiners.\1\ If this
    trend continues unabated, the Commission's mission of protecting
    investors and maintaining market integrity will be seriously
    threatened.
    ---------------------------------------------------------------------------
        \1\ Over the past several years the Commission has explored
    virtually every available approach to keeping staff longer. In 1992, we
    petitioned and received from the Office of Personnel Management
    (``OPM'') the authority to pay the majority of our attorneys and
    accountants approximately 10 percent above their base pay. While
    special pay was a step in the right direction, its value erodes over
    time and it proved to be a short-term solution. This is because staff
    that receive special pay do not receive the government-wide locality
    increase each year, which means that their special pay becomes less
    valuable over time and hence becomes less effective as a retention
    tool. Our appropriation last year included funds to reinstate special
    pay rates for certain attorneys, accountants, and examiners and OPM
    recently approved our proposed special pay rates for these employees.
    While this should help, based on our experience we know that this is at
    most a temporary and partial remedy to the SEC's staffing crisis. In
    addition, even with special pay, the salaries at the federal banking
    regulators are still substantially more than we can pay our staff.
    ---------------------------------------------------------------------------
        We currently estimate that implementing pay parity will cost
    approximately $70 million in fiscal 2002, with yearly adjustments for
    inflation thereafter. This increase brings our revised fiscal 2002
    appropriation request to $508 million. While I recognize that this
    represents a large increase for the Commission, I strongly believe that
    the most vital resource the SEC has is its highly professional and
    well-regarded staff and that they ought to be compensated at levels
    consistent with the other Federal financial regulators.\2\ I look
    forward to working with you to ensure that this additional funding is
    provided and this issue is resolved.
    ---------------------------------------------------------------------------
        \2\ A broad cross-section of the securities industry, corporate
    community, and investor groups have expressed support for pay parity,
    including the Securities Industry Association, the Investment Company
    Institute, the Investment Counsel Association of America, the Business
    Roundtable, the California Public Employees' Retirement System
    (CalPERS), Teachers Insurance and Annuity Association College
    Retirement Equity Fund (TIAA-CREF), the National Association of
    Securities Dealers, the New York Stock Exchange, and Fidelity
    Investments.
    ---------------------------------------------------------------------------
                                 fee reductions
        In addition, I would like to take this opportunity to briefly
    comment on the fee provisions of both S. 143 and H.R. 1088. Both bills
    would significantly reduce fees for investors, market participants, and
    companies making filings with the Commission, while preserving the
    amount of offsetting collections available to this Committee to fund
    the agency in coming years.\3\ These bills also spread the cost of
    regulation among those who benefit from the activities of the
    Commission and address the agency's funding structure in a
    comprehensive and balanced manner. The fee provisions in these bills
    not only have the support of the SEC, but also of the Administration.
    ---------------------------------------------------------------------------
        \3\ The Congressional Budget Office estimates that fees required to
    be collected by the SEC from all sources will total over $2.47 billion
    in fiscal 2001. This amount represents more than five times the SEC's
    enacted fiscal 2001 appropriation of $422.8 million. As stated, both S.
    143 and H.R. 1088 are designed to reduce fees while maintaining the
    amount of offsetting collections that are available to the SEC's
    appropriators. In fiscal 2002, this amount is estimated at $1.15
    billion.
    ---------------------------------------------------------------------------
                        station place lease procurement
        Finally, I would like to provide some additional details regarding
    the Commission's new headquarters lease. On May 29, 2001 the SEC
    awarded a 14-year lease for 650,000 rentable square feet at Station
    Place, adjacent to Union Station, to Louis Dreyfus Properties, LLC, of
    New York. This decision was made after an extensive two-year
    procurement during which the Commission held a vigorous competition and
    consulted with its authorizing committees, appropriations committees,
    the Public Works Committee, the General Services Administration
    (``GSA''), the Office of Management and Budget (``OMB''), and the
    District of Columbia.
        The Commission's current headquarters lease at 450 5th Street, N.W.
    ends in fiscal 2004 and we were required to compete for a new lease
    pursuant to the Competition in Contracting Act.\4\ The SEC has been at
    this location since 1982 and has been suffering from overcrowding for
    the last several years. In calendar 2000, we procured additional space
    at 901 E Street, N.W. and moved several units out of our headquarters
    to ameliorate overcrowding.\5\ While this last move was essential to
    deal with severe overcrowding, it has negatively impacted the
    activities of the Commission and reduced our efficiency. In preparing
    to obtain new space, the SEC sought to consolidate the agency's
    offices, relieve existing overcrowding, meet safety and health
    requirements, and ensure adequate access to mass transit. We received a
    number of proposals and enjoyed a healthy competition. Station Place
    offered the best means to reach our goals. More specifically, it was
    the lowest cost, highest technically rated offer in the procurement and
    represents the best value to the government.
    ---------------------------------------------------------------------------
        \4\ The Commission currently has several leases expiring in the
    regions, in addition to the agency's headquarters lease. We originally
    signed many of these leases during the late 1980s and early 1990s when
    prices in the real estate market were depressed and significantly lower
    than the rates that can be obtained today.
        \5\ The Commission previously moved a large portion of its
    administrative, information technology, and operations functions out of
    headquarters and into the Commission's Operations Center in Alexandria,
    VA in the early and mid 1990s as a first step toward alleviating
    overcrowding. Those functions will remain in Alexandria after the
    Commission moves to Station Place.
    ---------------------------------------------------------------------------
        During this procurement, the Commission followed all applicable
    laws and worked closely with GSA and OMB. From an appropriations
    perspective, the Commission's award to Station Place was scored as an
    operating lease and will not require an upfront appropriation of funds
    to be constructed. Instead, its rental costs will be covered on a
    yearly basis through our appropriation, much as now. I want to assure
    you that this move is appropriate for the Commission, good for the
    city, and the best deal available to the government.
                                   conclusion
        Our nation's markets and the SEC are at a crossroads. New
    technologies and activities continue to pose new challenges and threats
    to the integrity of our markets, as does increased globalization. I
    appreciate the support that this Committee has provided the SEC in the
    past and look forward to having a fruitful dialogue regarding the
    resource needs and policy issues that currently face the Commission. I
    also appreciate the willingness this Committee has already shown in
    recognizing the need to resolve the SEC's intractable staffing
    problems. I look forward to working with you toward final passage and
    funding of pay parity legislation.

                                   Pay parity

        Senator Hollings. Let me ask you, how much for pay parity?
        Ms. Unger. How much is the cost?
        Senator Hollings. Right.
        Ms. Unger. Seventy-point-nine million dollars.
        Senator Hollings. You sound the alarm that one-third of the
    staff has left in the last year and you still have 280 vacant
    positions. At the same time, though, your request assumes the
    reduction of some 41 FTEs and 57 other positions, almost 100
    positions. Do you support that request, or was that OMB's
    request?
        Ms. Unger. That was the President's budget, which we do
    support.

                              Penalty collections

        Senator Hollings. And then that is not what SEC needs. We
    want to make sure you do a good job, and heretofore, you have
    done a good job. I have a question about the disgorgement,
    because you have got a recent Inspector General's report that
    was just published that you let quite a bit of penalty fines go
    by the board. Can you explain that?
        Ms. Unger. Yes. I think the report mentions that of about
    $366 million of penalties that were assessed, about $60-
    something million was waived. That is usually done under very
    specific circumstances where the defendant has made a showing
    that they have an inability to pay.
        I, as a Commissioner, when I first joined the agency, did a
    top-to-bottom review of the Enforcement Division and noted that
    we could do better in collecting penalties, and I think we have
    strengthened the criteria for permitting when defendants can
    waive disgorgement. But, of course, we are constantly looking
    at and reviewing that.
        We have, since the report that you just mentioned was
    released, implemented a few additional steps. One is that we
    require the defendant to sign a waiver so that we can get their
    actual financial report, their public report. Another is that
    the Chief Counsel's Office of our Division of Enforcement will
    review each and every request for a waiver. And the third thing
    is the inability to pay. We have established a more consistent
    approach to granting these waivers and have established clearer
    criteria for the staff.

                                vacant Positions

        Senator Hollings. How much money do you need to fill those
    280 vacant positions?
        Ms. Unger. I think the figure that we had given as to what
    we would like our budget to be was closer to $577 million.
        Senator Hollings. Five-hundred-and-seventy-seven million?
        Ms. Unger. That would include pay parity and full staffing.
        Senator Hollings. Now we are talking sense.
        Ms. Unger. Of course, we can always make do with more
    money, Mr. Chairman.

                             conclusion of hearings

        Senator Hollings. Well, we appreciate very much your
    opinion and indulgence. With the late hour and everything of
    that kind, the committee will leave the record open, because we
    have some Senators that want to ask some questions. We will
    leave that record open for those questions and your answers,
    and unless you have other comments, the committee will be in
    recess subject to the call of the Chair.
        Ms. Unger. Thank you very much, Mr. Chairman.
        Senator Hollings. Thank you very much.
        The subcommittee is in recess.
        [Whereupon, at 11:29 a.m., Thursday, June 28, the hearings
    were concluded, and the subcommittee was recessed, to reconvene
    subject to the call of the Chair.]

    DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE JUDICIARY, AND RELATED
                  AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2002

                                  ----------

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

                             DEPARTMENTAL WITNESSES

        [The following testimonies were received by the
    Subcommittee on Commerce, Justice, and State, the Judiciary,
    and Related Agencies for inclusion in the record. The submitted
    materials relate to the fiscal year 2002 budget request for
    programs within the subcommittee's jurisdiction.]

                                 THE JUDICIARY

    Prepared Statement of Honorable John G. Heyburn II, Chairman, Committee
            on the Budget, Judicial Conference of the United States
                                  introduction
        Chairman Gregg and Members of the Subcommittee, thank you for
    giving me the opportunity to testify on the judiciary's fiscal year
    2002 budget request. I look forward to working with you, the other
    members of the subcommittee, and your dedicated staff as we go through
    this process.
        Before addressing our fiscal year 2002 request, on behalf of the
    entire judiciary, and especially our very busy courts along the
    southwest border, I would like to express our sincere appreciation for
    the generous funding levels this subcommittee and the Congress provided
    to the judiciary for fiscal year 2001. As you know, the courts were
    facing a severe crisis along the southwest border and the fiscal year
    2001 appropriations provided the funds needed to hire staff to address
    the workload explosion that occurred there over the past few years. It
    is the first time since 1998 that we have been able to fund the courts'
    staffing needs. For that we are thankful. The increase this
    subcommittee provided in fiscal year 2001 will demonstratively improve
    justice across the country. I would be remiss if I did not state at
    this point that while the additional staff resources provided by
    Congress will make a huge difference, many courts, especially those
    along the southwest border, are woefully short of judges. I will
    discuss this issue in more detail later in my statement.
                                budget overview
        Overall, the judiciary has submitted a fiscal year 2002 budget
    request that is necessary to maintain our current level of staff and
    operations and to allow the courts to handle growing workload and other
    critical needs. In total, we are requesting a $610 million increase in
    appropriations for all judiciary accounts over the fiscal year 2001
    enacted level. More than three-quarters of this increase ($464 million)
    funds base adjustments needed to continue current operations. The
    remainder ($146 million) is primarily to rectify the critical
    deficiencies in the Supreme Court Building that I believe you will be
    discussing with the justices next week ($110 million), and to continue
    the efforts begun last year to provide the courts the staffing
    resources needed to keep pace with workload increases. A detailed
    explanation of our fiscal year 2002 request is included as an Appendix.
                        ensuring the quality of justice
        An independent judiciary that all of our citizens trust and respect
    is a fundamental tenet of our nation. In order to foster that
    independence, citizens must believe that their disputes will be
    resolved in a fair and expeditious manner. To do so requires a
    commitment by the Congress to provide the courts adequate resources.
    Our request before you today provides a blueprint of those resource
    requirements.
        Of course, we in the Judicial Branch must also make a commitment,
    to do everything in our power to utilize the resources provided by
    Congress effectively and efficiently. Later in my statement I will
    discuss our ongoing efforts to contain costs in the judiciary, but
    first I would like to take you behind the scenes and provide examples
    of the dedicated work performed throughout our judicial system.
        Probation officers who supervise convicted felons as part of their
    sentence are a key component of the judicial system. Our probation
    officers work very closely with those they supervise, not only to
    ensure those individuals do not slip back into a life of crime, but
    also to assist them in changing their lives for the better. For
    example, Val, a single mom who was deeply involved in the drug culture,
    was imprisoned for distribution of cocaine. Once released from prison,
    Val was placed under the supervision of one of our probation officers.
    With the encouragement and support of her probation officer, Val worked
    steadily and supported her child, and at the same time, earned an
    undergraduate degree. She then went on to obtain a law degree, was
    subsequently admitted to the state bar, clerked for a state court
    judge, and was eventually admitted to practice in federal court.
        The federal judiciary also brings about fairness and justice to the
    common citizen who is wronged and has only the court as its last resort
    for protection.
        A probation officer's rigorous enforcement of the conditions of
    supervision compelled one offender, a businessman who had embezzled
    from his employees' pension funds, to return his ill-gotten gains back
    to his victims. The offender steadfastly protested that he did not have
    money to pay the court-ordered restitution. However, the probation
    officer's scrutiny of the offender's affluent lifestyle and his
    questionable commingling of business and personal finances revealed
    otherwise. As a result of the officer's efforts, the offender paid
    $40,000, the balance of restitution owed.
        Respect for our system of justice inspires the citizens who serve
    as jurors to go beyond the call of duty, as evidenced in a recent civil
    case that jurors considered for three days before reaching a verdict.
    It was later discovered that one of the jurors was functionally
    illiterate. The others took the time to read every exhibit to him.
        Finally, this country's independent judiciary serves as a model
    worldwide to bring fairness and human rights to other nations. A visit
    by Russian Judge Sergei Pashin to a United States District Court helped
    inspire his desire to change Russia's courts into something more than a
    rubber stamp for prosecutors. Judge Pashin found in America a system of
    justice that was ``. . . interested only in finding the truth.''
        Our ability to provide a level of service our citizens deserve is
    dependent in large part on the resources provided by Congress. The
    balance of my statement describes those resource needs in the following
    areas--(1) an appropriate level of compensation for private panel
    attorneys; (2) a level of judicial officers and support staff
    commensurate with the workload placed upon them; (3) an adequate level
    of security in the courthouses; and (4) adequate compensation for our
    judicial officers.
                               defender services
        There are two areas where significant increases in resources are
    required in the defender services area to avoid adversely affecting the
    quality of our justice system. An increase of $23 million is needed to
    provide counsel for 5,200 additional representations projected for
    fiscal year 2002. This requirement is in large part a function of the
    projected increase in criminal filings by the Department of Justice.
    The other significant increase requested in this account is to provide
    $35 million to raise the compensation for private panel attorneys.
        The increase of $35 million to raise the compensation for private
    panel attorneys is of the utmost importance to the federal judiciary.
    One of the biggest impediments to maintaining a fair system of justice
    is the low rate of pay that private panel attorneys receive. In 1986,
    Congress amended the Criminal Justice Act (CJA) to allow the judiciary
    to pay $75 per hour for both in-court and out-of-court work. At that
    time, the hourly rates were $60 for in-court and $40 for out-of-court.
    This amendment also allowed the judiciary to raise the $75 rate in
    future years to reflect inflation. Instead of keeping pace with
    inflation, Congress has only funded an hourly rate of $75 in-court and
    $55 out-of-court in most locations. In 1986 dollars, this $75/$55 rate
    is equivalent to only $46 in-court and $33 out-of-court, significantly
    less than the $60 and $40 rates that were effective in 1986.
        The $113 rate that is being requested for fiscal year 2002 is the
    amount that was envisioned by the amendment to the CJA in 1986,
    adjusted for inflation as the statute provides. The failure to
    implement higher panel attorney rates is increasingly becoming a
    problem in the federal criminal justice system. In some districts,
    judges are unable to find qualified attorneys to take many CJA
    appointments because the current rate often does not cover overhead
    costs. For example, a panel attorney with over 20 years of criminal law
    experience indicated that he is unable to provide his employees with
    health care or retirement benefits due to the low rates of pay. He
    added that rents in downtown Seattle have skyrocketed in recent years,
    from $12 per square foot in 1988 in his building to approximately $36
    today.
        The quality of justice will suffer further and citizens will begin
    to question the fairness of our judicial system when unqualified
    lawyers who don't have expertise in federal criminal practice are
    appointed to represent those defendants who are financially unable to
    retain counsel.
                              court support staff
        The judiciary is requesting $16 million for 212 new court support
    FTE to allow the courts to keep pace with changes in its largely
    uncontrollable workload. Court staff are the backbone of court
    operations and as caseload grows, staff must grow along with it.
    Without sufficient staff, processes are short-changed, cases may be
    delayed, support provided to judicial officers and the public will
    deteriorate, and public safety is compromised. This can lead to a lack
    of confidence in our judicial system among our citizenry.
        Most of the requested increase is for the probation and pretrial
    services program. Probation and pretrial services offices play an
    integral role in our criminal justice system and ensure public safety
    in our communities. There are almost 129,000 offenders under the
    supervision of probation and pretrial services officers as compared to
    125,000 prisoners currently in federal prisons. The daily cost of
    supervision in the community in fiscal year 1999 was $7.74 compared to
    $59.41 for the Bureau of Prisons. The extent to which the offices are
    adequately staffed directly affects how closely they can monitor the
    activities of dangerous convicted felons and prevent potential
    problems. For instance, an offender on supervised release receiving
    mental health counseling, was given a polygraph examination to gauge
    the danger he posed to the community. It revealed that he was stalking
    an eight-year-old girl. The child's family was notified, the offender
    received treatment to address the problem, and a potential sexual
    assault was averted.
        Probation and pretrial services offices need sufficient resources
    to provide necessary mental health and substance abuse treatment for
    offenders. The fiscal year 2002 request includes a $5.2 million
    increase for this purpose. These types of treatment programs can put
    people on the road to success. For example, John served a term of
    imprisonment following conviction for conspiracy to distribute
    marijuana and cocaine. While incarcerated, he successfully completed a
    drug and alcohol treatment program. When released, John entered an
    aftercare program (under contract with the Probation Office) and
    regularly attended Alcoholics Anonymous and Narcotics Anonymous
    meetings. Eventually, he got a part-time job as a rehabilitation
    technician at a local outpatient chemical dependency treatment center.
    While continuing his part-time employment at the treatment center, John
    completed both a bachelor's degree and a master's degree in counseling,
    and is currently a doctoral candidate in the field of counseling. His
    career goal is to remain in the field of addiction counseling.
                                 court security
        A key tool in ensuring the quality of justice is maintaining
    adequate security in our nation's courthouses. If our citizens feel
    safe in the courtroom, they will feel more confident about what happens
    in those buildings. Being thoroughly screened when entering courthouses
    and having court security officers visible throughout is an absolute
    necessity to protect all who enter our courthouses.
        Unfortunately, our court security appropriation, which funds court
    security officers and security systems, is one for which Congress could
    not find sufficient resources to meet the needs in fiscal year 2001.
    The fiscal year 2002 request rectifies these deficiencies, particularly
    in the area of replacing inadequate and outdated equipment. In
    addition, it includes funds for both court security officers and
    equipment for new buildings that will be coming online in fiscal year
    2002.
        Another security concern, though not part of the judiciary's budget
    request, is the lack of resources available to the U.S. Marshals
    Service. The Marshals Service is responsible for the security of
    courthouses, judges, court proceedings, and the public who come into
    our buildings. They are also responsible for the transportation and
    security of prisoners and fugitive apprehensions. They are experiencing
    severe personnel resource deficiencies, particularly along the
    southwest border, where they do not always have enough deputy U.S.
    Marshals to move prisoners safely from their holding cells, through
    public hallways in courthouses, or to monitor them in the courtrooms.
    The Marshals Service should be funded so they can perform all of their
    security related missions in a safe and professional manner.
                             judicial compensation
        We live in a society where cost-of-living salary adjustments to
    maintain purchasing power--whether such adjustments are made pursuant
    to a collective bargaining agreement or a statute as in the case of
    Social Security--are a fact of economic life. Yet, over the past eight
    years members, judges, and high level executive branch officials have
    received only three annual Employment Cost Index (ECI) adjustments. As
    a result, their purchasing power has declined by over 13 percent, which
    amounts to more than $16,000 per year. While we are very grateful that
    Congress approved an ECI adjustment for fiscal year 2001, and
    particularly for your leadership in that effort, Chairman Gregg, it is
    noteworthy that even the 2.7 percent increase failed to keep pace with
    the change in the cost of living.
        The corrosive effects of this salary erosion on judges were well
    documented in a recent report published by the American and Federal Bar
    Associations. That report discussed in detail the potential effects of
    denying judges annual ECI adjustments, including its effect on judges'
    recruitment, retention, and productivity. The report was favorably
    received by the media. It also confirmed the views of the Chief
    Justice, who in his 2000 year-end statement observed that ``in order to
    continue to provide the nation a capable and effective judicial system
    we must be able to attract and retain experienced men and women of
    quality and diversity to perform a demanding position in the public
    service . . . In order to continue to attract highly qualified and
    diverse federal judges--judges whom we ask and expect to remain for
    life--we must provide them adequate compensation.''
        For the aforementioned reasons, the Judicial Conference strongly
    encourages Congress to authorize an Employment Cost Index (ECI)
    adjustment for federal judges, members of Congress, and top officials
    in the executive branch for 2002 and subsequent years, as provided by
    law; enact legislation to give judges and other high level federal
    officials a ``catch-up'' pay adjustment of 9.6 percent to recapture
    previous ECI adjustments that were not provided; and authorize a
    Presidential commission to consider and make recommendations to the
    President on appropriate salaries for high-level officials in all three
    branches of the government.
                                 new judgeships
        Without judges, justice cannot be administered. There has not been
    a major judgeship bill since 1990. Yet increases in federal
    jurisdiction and law enforcement resources over that period have
    contributed to a more than 25 percent increase in workload for the
    judiciary. Only through the appropriations process has there been a
    modest increase in judgeships with nine added in the fiscal year 2000
    and ten in the fiscal year 2001 appropriations bills. The Judicial
    Conference of the United States currently is requesting that 54 Article
    III judgeships be created. Despite Congress' efforts in the last two
    appropriations bills, there are some districts--particularly those
    along the southwest border--where the workload has more than doubled,
    but where the number of judgeships remains constant. Justice in these
    locations has been compromised because the judges have not been there
    to meet the workload demands.
                                cost containment
        One area in which the judiciary takes great pride is its continual
    effort to work more efficiently and effectively while still maintaining
    the high quality of justice. The Optimal Utilization of Judicial
    Resources Report that we send to your subcommittee annually is a
    compilation of our initiatives. A bird's-eye view of a court
    illustrates the range of efforts we have underway.
        In a federal courthouse, a bankruptcy clerk is able to use the
    Internet for transactions made by the Bankruptcy Noticing System. The
    Internet connection replaces the U.S. Mail method, saving postage
    expenses and allowing the transmission of notices at a fraction of the
    time. Postage costs were further reduced when fax options were
    introduced to the Bankruptcy Noticing Program in fiscal year 2000.
        At the same time, a court executive might be checking e-mail for an
    important memo from the Administrative Office. In fiscal year 2000 the
    Administrative Office began to send official policy directives, time-
    sensitive documents, and other important information to chief judges
    and court unit executives, electronically rather than using paper
    memos.
        Meanwhile, in a district clerk's office, staff are calculating
    juror payments using the Jury Management System, an automated software
    system that also prints and scans qualification questionnaires and
    summonses, and tracks jurors, among other things. This system is
    expected to be implemented in most courts by the end of 2001. The
    system reduces errors caused by redundant data entry and gives the
    court immediate access to juror statistics.
        A clerk of court's office also is receiving hundreds of case
    filings from attorneys--with no one standing in line at the court.
    Instead, they may be miles away, in their own offices, making use of
    the Case Management/Electronic Case Files System to send and retrieve
    case documents over the Internet. In turn, a court uses the electronic
    records for efficient docketing, scheduling, and notice production. In
    addition, litigants are able to search, locate, retrieve, and deliver
    case documents electronically. A version of the system is installed
    already in 14 bankruptcy courts and seven district courts. The
    judiciary has completed testing of the bankruptcy version and is now
    beginning nationwide implementation.
        Staff in a judge's chambers are going on-line to post a notice of
    an available law clerk position on the Federal Law Clerk Information
    System. The judiciary developed this national database to save time and
    help judges and law students with the annual process of hiring law
    clerks. In the short time this system has been available, nearly one-
    third of all judges are using it and the number is growing.
        In a busy courthouse, a courtroom equipped with a television
    monitor and a video camera can be used to hold a hearing, in which the
    parties are separated by several hundred miles. In the district courts,
    videoconferencing is being used in pretrial, civil, and certain
    criminal proceedings, prisoner matters, sentencing, settlement
    conferences, arraignments, and witness appeals. Videoconferencing saves
    travel time and reduces security risks in transporting prisoners. At
    the appellate level, oral arguments may be heard using
    videoconferencing, again saving time and the cost of travel. To date,
    more than 200 federal court sites have been equipped to received these
    broadcasts.
        Television monitors may also be in use elsewhere in the courthouse,
    but in a very different role. Judicial employees at the court are
    participating in a classroom instruction on use of a word-processing
    program. Also on the agenda is a program for probation and pretrial
    services officers on the special needs of offenders. Programs
    transmitted over the distance learning network, the Federal Judicial
    Television Network, allow employees to receive instruction without
    traveling to training sessions. Millions of travel dollars are saved by
    the use of distance training.
                   contributions of the administrative office
        The Administrative Office of the United States Courts is critical
    to the judiciary's ability to provide quality justice. The Director of
    the Administrative Office serves as the chief administrative officer
    for the federal courts. The Administrative Office provides essential
    administrative support, program management, and policy development
    assistance to federal courts nationwide. Administrative Office
    employees support 32,000 judiciary employees, including 2,000 Article
    III, bankruptcy, and magistrate judges, as well as probation and
    pretrial services officers, circuit executives, federal public
    defenders, clerks of court, court reporters and interpreters, financial
    administrators, jury administrators, systems managers and others.
        Support of the Judicial Conference and its committees remains an
    essential function of the Administrative Office. The twenty-four
    committees have Administrative Office staff experts who work closely
    with them in conducting research and supporting their judiciary-wide
    policy and governance function. The Administrative Office also executes
    and implements Judicial Conference actions.
        An important Administrative Office responsibility is supporting,
    coordinating, and implementing the judiciary's numerous efforts to
    reduce costs and manage resources most efficiently. The various cost-
    containment efforts I just summarized, as well as all of those listed
    in the Optimal Utilization Report, are only possible because of the
    efforts of the Administrative Office. Without the Administrative
    Office, many of the savings and cost avoidance initiatives would not
    have materialized.
        In the interest of continuous service improvement, the
    Administrative Office conducts or oversees, in connection with Judicial
    Conference Committees, a large number of strategic studies of judiciary
    programs and operations. An independent study of the national
    information technology program found that the judiciary is making
    effective use of technology. The study indicated that this is a
    significant accomplishment given that the judiciary's investment in
    information technology is well below federal government benchmarks and
    what would be expected given the complexity of the judiciary. The
    Administrative Office also oversaw a comprehensive management
    assessment of its space and facilities program. The Administrative
    Office is working with an outside contractor to conduct a strategic
    comprehensive assessment of the probation and pretrial services system.
    The broad issue is whether there are ways to accomplish the system
    mission more effectively when facing increasing responsibilities,
    changing federal criminal populations, and constrained budgets. There
    is also a study being conducted of the judiciary's security program to
    evaluate its effectiveness and efficiency.
        The fiscal year 2002 budget request for the Administrative Office
    is $4.8 million over fiscal year 2001 appropriations. Most of this
    increase would fund base adjustments needed to continue current
    operations. The remainder ($693,000) will be devoted to improving
    programmatic oversight and support of court programs such as the
    probation and pretrial services system as well as to developing major
    automated systems. In addition, funds are requested for equipment
    maintenance and replacement and software upgrades to allow the core
    Administrative Office financial and automated systems to remain
    functional and current.
        I urge the Committee to fund fully the Administrative Office's
    budget request. The Administrative Office is integral to the
    judiciary's ability to do its work. Without the Administrative Office's
    support, the judiciary could not continue to function as effectively.
    The increase in funding will ensure that the Administrative Office
    continues to provide program leadership and administrative support to
    the courts, and lead the efforts for them to operate efficiently.
                  contributions of the federal judicial center
        The Federal Judicial Center is the federal judiciary's agency for
    continuing education and training. With this subcommittee's
    encouragement, it has worked hard in the last few years, with the
    resources available to it, to provide even more of its education
    through ``distance learning'' which does not require participants to
    travel to the training.
        As Judge Smith's statement notes, educational programs sponsored by
    the Center or arranged locally using Center resources reached over
    50,000 participants last year, and over 90 percent of those
    participating did so at their desks, before a TV monitor, or elsewhere
    in the courthouse.
        Even educational technology, though, requires resources. Last year,
    the Center received a current services appropriation, but no more. This
    was the first current services appropriation for the Center in ten
    years. This year the Board of the Center proposes a modest increase for
    normal adjustments to the base budget and for additional positions to
    enhance the effectiveness of its distance learning.
        In evaluating the Center's request, I ask the subcommittee to
    consider not only how the Center uses technology for education but also
    the importance of the education itself to the fair and efficient
    operation of the judicial branch. Center orientation seminars, for
    example, introduce every judge to his or her responsibility for
    effective docket management. And, in respect to the growing amount of
    complex litigation involving scientific and technical evidence, as the
    Chief Justice said in his year-end statement, ``FJC education programs
    and reference guides help judges sort out relevant facts and applicable
    law from the panoply of information with which the adversary system
    bombards them. The FJC thus contributes to the independent decision
    making that is the judge's fundamental duty.''
        For another example, Center education helps probation officers deal
    with the range of sophisticated offenders convicted of federal crimes.
    Judge Smith's statement summarizes these and many other ways in which
    Center education and Center research improve the administration of
    justice.
        I believe the Center's request deserves the committee's support and
    urge favorable action on the full amount.
                                   conclusion
        Chairman Gregg and members of the subcommittee, this concludes my
    statement. I look forward to working with you in the future.
                                    appendix
                                    summary
        The fiscal year 2002 appropriation request for the Courts of
    Appeals, District Courts and Other Judicial Services totals
    $4,538,547,000, an increase of $481,823,000 over the fiscal year 2001
    available appropriation. In addition to appropriated funds, the
    judiciary utilizes other funding sources to supplement our
    appropriations including fee collections, carry forward of fee balances
    from a prior year, and the use of no-year funds. When all sources of
    funds are considered, the increase in obligations for fiscal year 2002
    is only $356,810,000 or 8.1 percent.
        Of the $481,823,000 increase in appropriations, 94 percent
    ($452,071,000) is adjustments to the fiscal year 2001 base associated
    with standard pay and other inflationary increases as well as other
    adjustments that will allow the courts to maintain current services in
    fiscal year 2002. The remaining 6 percent ($29,752,000) is needed to
    respond to increased requirements for magistrate judges, federal
    defender offices, security, drug and mental health treatment, and to
    fund additional court staff required to process growing workload. The
    request for the principal programs are summarized below.
                             salaries and expenses
        The salaries and expenses of circuit, district, and bankruptcy
    courts and probation and pretrial services offices account for most of
    our request. A total of $3,964,528,000 is required for this account in
    fiscal year 2002. Funding totaling $226,062,000 is expected to be
    available from other sources including fee collections and carry
    forward balances to fund S&E requirements. This leaves an appropriation
    need of $3,738,466,000 which is $374,357,000 above the fiscal year 2001
    available appropriation.
        Over 90 percent of the $374,357,000 increase ($347,328,000) is
    needed to fund adjustments to the fiscal year 2001 base including: pay
    and benefit increases for judges ($12,133,000); increases in the number
    of filled Article III judges, senior judges and magistrates judges
    adjustments ($15,783,000); pay and benefit increases for court support
    and probation and pretrial services staff ($126,982,000); annualization
    of new court support and probation and pretrial services positions
    partially funded in fiscal year 2001 ($30,443,000); increases necessary
    to maintain fiscal year 2001 staffing levels because of a reduction in
    non-appropriated funding ($105,175,000); increases for space rental and
    associated costs ($61,300,000); inflationary increases for operating
    costs ($9,731,000); and reductions in non-recurring costs
    (-$14,219,000).
        The remaining 4 percent ($27,029,000) will fund 14 additional
    magistrate judges and their staff to help Article III judges handle the
    growing volume of civil and criminal cases facing the courts
    ($5,638,000); 212 court support FTEs to address a net increase in
    workload, almost entirely in the probation and pretrial services
    offices ($16,149,000); and increased mental health and substance abuse
    treatment for projected growth in the number of offenders and
    defendants under supervision requiring this treatment ($5,242,000).
                               defender services
        An appropriation of $521,517,000 is required for the Defender
    Services program to provide representation for indigent criminal
    defendants in fiscal year 2002. This is an increase of $87,474,000
    above the available fiscal year 2001 appropriation.
        Over 99 percent of this increase ($86,874,000) is needed for
    adjustments to the fiscal year 2001 base for inflationary and workload
    increases. Included in these adjustments are standard pay and inflation
    increases as well as other adjustments that will allow the program to
    maintain the base caseload costs ($28,494,000); an increase of the non-
    capital hourly panel attorney rate to $113 for all districts beginning
    April 1, 2002 ($35,135,000); and an increase associated with a workload
    increase of 5,200 additional representations in fiscal year 2002
    ($23,245,000).
        The remaining increase ($600,000) will fund the start up costs of
    two new federal defender organizations. The Congress and the Judicial
    Conference have urged us to establish more federal defender
    organizations as an alternative to using panel attorneys in districts
    where this would be appropriate.
                        fees of jurors and commissioners
        For the Fees of Jurors program, an appropriation of $50,131,000 is
    required, a decline of $9,305,000 from the fiscal year 2001 available
    appropriation. This decline is the result in the steady growth of carry
    forward balances in this account that can be used to offset the
    appropriations requirement (-$9,089,000); a decrease in the projected
    number of juror days (-$669,000); and an increase for inflation
    ($453,000).
                                 court security
        For the Court Security program, an appropriation of $228,433,000 is
    required, which is an increase of $29,297,000 above the fiscal year
    2001 available appropriation. Over 90 percent of the requested increase
    ($27,174,000) is for adjustments to base including: an increase for
    standard pay, benefit and contractual services inflation ($9,168,000);
    an increase to annualize the costs for 72 new court security officers
    (CSOs) partially funded in fiscal year 2001 ($1,684,000); an increase
    to provide a security presence in new and renovated courthouse space
    being delivered during fiscal year 2002 ($4,667,000); and an increase
    for the cyclical replacement of security systems and equipment
    ($11,655,000).
        The remaining increase of $2,123,000 will improve communications
    systems in buildings with inadequate capabilities and fund security
    systems in probation and pretrial services offices to meet current U.S.
    Court Design Guide requirements.
                                     ______

     Prepared Statement of Leonidas Ralph Mecham, Director, Administrative
                           Office of the U.S. Courts
                                  introduction
        Chairman Gregg and Members of the Subcommittee, thank you for
    giving me the opportunity to testify before you on the fiscal year 2002
    budget request for the Administrative Office of the United States
    Courts (AO). I am also pleased to continue to work with you and your
    dedicated staff.
                       role of the administrative office
        The AO serves as the central support agency for the administration
    of the federal court system. The AO was created in 1939 in response to
    the separation of powers concerns that were raised by the Department of
    Justice being responsible for the judiciary's administrative needs.
    Over sixty years later, judicial independence and exemplary service to
    the courts continue to be the guiding principles that govern and
    influence AO operations.
        The AO plays a key role in the administration of justice and
    management of change in the courts. It supports the Judicial Conference
    of the United States and its 24 committees in determining and
    implementing judiciary policies; develops new methods, systems, and
    programs for conducting the business of the federal courts efficiently
    and effectively; assists the courts in implementing better practices;
    develops and supports new innovative technologies that enhance the
    operations of the courts; collects and analyzes statistics on the
    business of the federal courts for planning and determining the
    judiciary's resource needs; provides financial management services;
    provides personnel and payroll support for 32,000 judiciary employees;
    conducts audits; and has implemented a strong internal controls program
    designed to safeguard against fraud, waste, and abuse.
        The work of all of the AO's employees supports the judges and court
    staff across the country and ensures that the judicial machine runs
    smoothly. In a period of resource constraints, and as the activity of
    the federal courts continues to grow in both size and complexity, the
    AO will continue to strive for administrative excellence through
    ingenuity, commitment, and innovation.
                              program assessments
        Another important leadership role the AO plays is in conducting
    management studies. These studies, performed with outside independent
    contractors, are aimed at improving court operations in major judiciary
    programs. (1) An assessment of the effectiveness and efficiency of the
    judiciary's space and facilities program was recently completed. The
    study recognizes that the judiciary has an effective long-range
    planning process which yields good projections for space planning
    needs. The study also offers several technical and process refinements
    to the long-range planning process. (2) A study of the judiciary's
    information technology program has also recently been completed. This
    study found that the judiciary is making effective use of information
    technology and that its investment in information technology, both
    equipment and human resources, is significantly below federal
    government benchmarks given our complex information environment. The
    study also provided seven strategic recommendations designed to help
    the judiciary continue seeking and capitalizing on technology
    improvement opportunities. All the recommendations are already at some
    stage of being implemented. (3) Assessments of the court security and
    probation and pretrial services program are currently being conducted.
                      administrative office budget request
        The AO's appropriation request for fiscal year 2002 is $63,029,000,
    which is an increase of $4,817,000 or 8.3 percent above the available
    fiscal year 2001 AO appropriation. Eighty-five percent of the increase
    or $4,124,000 is necessary to fund uncontrollable adjustments to base
    for standard pay, benefit and inflationary increases. The remaining
    small increase of $693,000 will be used to improve the AO's
    programmatic oversight and support of court activities and improve the
    operations of core financial and automated systems.
        Included in this request is funding for only four additional full-
    time equivalents. These additional AO staff will be devoted to
    providing technical support to probation and pretrial services and
    court administration programs with their 22,000 staff, and to
    developing major automated systems which support the administrative
    functions discussed above. These staff will focus on conducting program
    and efficiency reviews; developing new case management programs and
    systems; and improving financial management and contracting procedures
    and regulations. These additional FTE will bring funded AO staffing
    levels back up to where they were in fiscal year 1996. While the AO
    could effectively use many more staff, the request is for a minimal
    increase.
        Also included in the request is a $313,000 increase to fund
    necessary automation equipment and services. Due to funding constraints
    since fiscal year 2000, the AO has not been able to meet fully its
    requirements for equipment and services. This additional $313,000 will
    improve the operations of core AO financial and automation systems,
    including the Central Accounting System and the AO data communications
    network. Without these additional funds, we will not be able to restore
    reductions made in fiscal year 2000 to the basic level of automation
    service necessary at the AO, including user assistance, software, and
    infrastructure support for the entire judiciary. Given the dependence
    on personal computers and the data communications network to conduct AO
    business and provide essential support to the courts, it is crucial
    that funds be provided for replacement of essential equipment and
    software to keep the AO's inventory functional and up-to-date.
                              model of efficiency
        This budget request demonstrates the AO's commitment to being a
    model of efficiency within the federal government. As an administrative
    support organization whose workload is largely driven by the size and
    workload of the courts it supports, the AO's growth over the past
    several years has not kept up with the growth experienced in the
    courts. Between fiscal years 1996 and 2002, the courts are projected to
    experience a 15 percent growth in funded staff, increasing the AO's
    workload substantially, while the AO's total staffing levels remain
    unchanged. Comparing the AO's budget to that of the Department of
    Justice's ``Management and Administration'' activities is further
    evidence of the AO's leanness. The appropriation for the AO is only 1.6
    percent of the judiciary's total appropriation, while the Department of
    Justice's ``Management and Administration'' activities comprise 5.4
    percent of the Department's total appropriation for fiscal year 2000.
                 accomplishments and challenges for the future
        The federal judiciary accomplishes its constitutional mission with
    only two-tenths of one percent of the federal government's budget, and
    the AO accomplishes its mission with less than two percent of the
    judiciary's appropriations. However, we recognize the fiscal
    constraints facing the Congress in the appropriations process and the
    necessity to use our small portion of the federal budget efficiently
    and economically. In order to achieve this, the AO is tasked with
    developing new systems, programs, and policies that will allow the
    courts to continue to provide, and in many cases improve, the quality
    of services provided to the bench, bar and the public as workload
    continues to increase. This is a daunting task on which our dedicated
    staff works very hard every day. I would like to take a few minutes to
    describe some of our accomplishments, as well as some ongoing
    activities and challenges that face the federal judiciary and the AO in
    fiscal year 2002. Additional examples can be found in The Optimal
    Utilization of Judicial Resources report submitted to the subcommittee
    in February.
    Management of Court Facilities
        Due to the nature of its work, the judiciary is a space intensive
    organization whose mission requires that we be available to the entire
    population of the United States. The judiciary has operations in over
    760 separate facilities across the country. These include
    accommodations for probation and pretrial services offices and court
    support functions as well as courthouses. Many buildings housing the
    judiciary are aging. The judiciary is currently housed in about 225
    buildings that are over 50 years old. Even where the structures remain
    serviceable, the architecture of that time did not envision the
    security and technological needs of today.
        The AO, along with the Judicial Conference and GSA, has
    aggressively worked to develop policies to minimize the amount of space
    required and the costs associated with it. This task is very
    challenging given the judiciary's need for additional space to
    accommodate workload growth and the need to replace aging and outdated
    space. This work has resulted in the U.S. Courts Design Guide which is
    used to standardize new space acquired by the judiciary. The AO has
    also played an integral role in the development of a rigorous long-
    range facilities planning process that is used to estimate the courts'
    space needs. This long-range planning process received the General
    Services Administration's (GSA) Annual Achievement Award for Real
    Property Innovation in 1998. In a January 2001 report titled, Federal
    Judiciary Space: Update on Improvements of the Long-Range Planning
    Process, the General Accounting Office (GAO) praised recent
    improvements the judiciary has made to the long-range planning process.
        While the judiciary's space requirements continue to grow, the AO
    remains committed to developing and implementing policies that both
    provide the courts with the space they require to complete their
    mission and minimize the costs associated with operating this space.
    Investment in and Recruitment of Skilled Personnel
        In a January 2001 report titled High Risk Series--An Update, the
    General Accounting Office (GAO) cites a key challenge facing the
    federal government as ``Acquiring and developing staff whose size,
    skills and deployment meet agency needs.'' The report goes on to state
    that ``human capital shortfalls are eroding the ability of many
    agencies and threatening the ability of others to effectively,
    efficiently, and economically perform their missions''. Although the
    judiciary was not included in this study, its findings are directly
    pertinent to the judiciary, in fact the judiciary's challenges are even
    greater than that of the Executive Branch's. While the judiciary faces
    the prospect of losing 40 percent of its employees to retirement over
    the next five years, we have additional recruitment issues, such as the
    recruitment of law enforcement personnel along the southwest border.
        In order to address this problem, the AO has implemented several
    programs to enhance the courts' ability to hire and retain skilled
    employees. Examples of these programs include an employee-pay-all long-
    term care insurance program, and a flexible benefit program which
    allows employees to pay for certain medical care, dependent care, and
    commuter expenses on a pre-tax basis. Recognizing these as innovative
    new programs, the Congress is now considering or has approved some of
    these benefit programs for the Executive Branch. For example, Executive
    Branch employees are authorized to pay for health insurance premiums on
    a pre-tax basis and long-term care insurance will be available to
    federal employees in October 2001. The AO is continuing to research
    potential recruitment and retention programs that address problems such
    as retaining information technology staff and recruiting law clerks.
        Another program the AO has implemented that enhances court
    managers' ability to manage their staffing needs is the Court Personnel
    System. This initiative provides court managers with increased
    flexibility to structure their workforce efficiently by decentralizing
    decision-making authority from Washington to the local level. For
    example, given an individual court's circumstances, local court
    managers have the authority to determine how many information
    technology staff are required to effectively operate their court's
    business within its funding allocation.
        The AO, in support of the Judicial Conference, will continue to be
    a leader in the federal government in the development of innovative
    programs that enhance the courts' ability to hire and retain skilled
    staff.
    Automated Systems and Technology Advances
        Under the guidance of the Judicial Conference Committee on
    Automation and Technology, the AO continues to study and invest in
    technological innovation to enhance the quality and efficiency of court
    proceedings, to improve the services to the bar and public, and to
    reduce costs. The AO has an ambitious automation program underway, with
    several major projects in various stages of development and
    implementation. While all of these projects enhance court operations,
    they will also require a sustained commitment from the AO over the next
    several years to complete their design, install them in the courts, and
    train and support court users on an ongoing basis. A few examples of
    the automation programs managed by the AO include:
        Videoconferencing.--To date, there are 200 federal court sites
    equipped with videoconferencing capabilities. The courts are using this
    equipment to conduct a variety of court proceedings including pretrial,
    civil and criminal proceedings, prisoner matters, sentencing,
    settlement conferences, witness appearances in trials, arraignments,
    bankruptcy hearings, and appellate oral arguments. The courts are also
    using this technology for administrative meetings, conferences and
    training seminars.
        Case Management and Electronic Case Files (CM/ECF).--This new
    system will provide the courts with a new more efficient case
    processing application that will allow court staff to focus their
    effort on ensuring more effective case management practices. The CM/ECF
    system will also include electronic case filing capabilities (which
    will be implemented at the individual court's discretion) allowing
    judges, court staff, attorneys and others to send and retrieve case
    documents over the Internet without leaving their desks. A version of
    these applications is already installed in 14 bankruptcy courts and
    seven district courts. Other federal agencies and state courts have
    been following our progress on this system and, seeing our work, are
    beginning to explore how they might adapt such a concept to their
    operations.
        While providing substantial qualitative and quantitative benefits
    to the courts, this system is consuming a substantial amount of AO
    staffing resources in the development, testing, installation, and
    training of court users.
        Electronic Bankruptcy Noticing.--This system operates like a
    sophisticated e-mail system by transmitting bankruptcy notices
    electronically and eliminating the production and mailing of papers.
    Internet e-mail and fax options make this program accessible to
    virtually the entire bankruptcy community.
        Federal Judiciary Television Network (FJTN).--In fiscal year 2000,
    the judiciary completed implementation of the FJTN, a satellite-based
    distance learning network. Each day the network provides more than
    eight hours of educational and training broadcasts to over 285
    locations throughout the judiciary. The programs provide information on
    a wide range of issues such as supervising offenders and defendants,
    the law clerk appointment process, and statistical reporting
    procedures. The FJTN, along with other distance learning techniques
    such as videoconferencing, videotapes and computer-based training,
    allows the AO, the Federal Judicial Center and the U.S. Sentencing
    Commission to deliver high-quality training and instruction to a larger
    audience at reduced costs compared to traditional classroom
    instruction.
        Federal Law Clerk Information System.--This Internet-based
    application implemented by the AO allows judges to post law clerk
    position announcements nation-wide and to monitor the availability of
    applicants. It also provides law school graduates the ability to locate
    opportunities to clerk for a federal judge using a nation-wide database
    instead of contacting individual judges.
        Core Administrative Systems.--The AO is in the process of
    modernizing many of the courts' core administrative systems including
    the financial accounting system, the personnel management system, the
    jury management system, and the Criminal Justice Act panel attorney
    payment system. These new systems are designed to improve the
    management of information, the tracking of resources, and the decision-
    making processes of the courts. While these new administrative systems
    are desperately needed by the courts, their successful implementation
    is dependent partially on the level of support and training provided by
    the AO during each system's implementation. The AO needs adequate
    funding to ensure the courts get the support and training required.
    Expansion of the Rule of Law and the Administration of Justice
            Throughout the World
        The AO supports the Judicial Conference Committee on International
    Judicial Relations in coordinating the Third Branch's relationship with
    foreign judiciaries and organizations involved in international
    judicial relations, the expansion of the rule of law, and the
    administration of justice. Federal judges and AO staff provide
    information, training and expertise on a wide range of subjects such
    as: judicial independence and accountability, judicial ethics and
    discipline, court administration, civil procedure, and the selection
    and appointment of judges. Requests for assistance are made and funded
    by institutions such as foreign judiciaries, the United States Agency
    for International Development, the Department of State, and the World
    Bank.
        Last year the AO conducted briefings for 57 foreign delegations,
    including 263 judges. A few examples of these programs include: a
    program for judges and court officials from Tanzania on judicial ethics
    and corruption; a program for judges from Russia on court
    administration; a program for judges from China on judicial
    administration and the use of automation and technology in the courts;
    and a program for the newly established bankruptcy court in Thailand on
    court administration. Last year, the federal judiciary also provided
    case management assistance to the European Court of Human Rights.
    Remote Supervision Technologies
        In fiscal year 2001, the number of offenders under the supervision
    of probation officers is projected to be 103,900 and the number of
    defendants received for supervision by pretrial services officers is
    projected to be 33,300. This total of 137,200 persons under supervision
    is higher than the approximately 125,000 prisoners being house in
    federal prisons. In certain circumstances, supervision of offenders and
    defendants is a cost effective alternative to incarceration as the
    daily cost of supervision in fiscal year 1999 was $7.74 compared to
    $59.41 for the Bureau of Prisons.
        While the number of persons under supervision is at an all-time
    high and projected to continue to increase, the population of offenders
    under supervision is changing from those on probation to persons
    released from prison. Offenders released from prison typically pose a
    higher risk to the public as they have difficulty transitioning from
    prison to our communities, are more likely to require substance or
    mental health treatment, and have committed more dangerous crimes.
        In order to address these problems, the AO is assisting probation
    and pretrial services offices in exploring the use of remote
    supervision technologies to reduce the risk posed by certain defendants
    and offenders. These include technologies to detect alcohol use
    remotely, to use automated telephone systems to verify an offender's
    location, and to employ global positioning satellite technologies to
    provide real-time continuous tracking of high risk offenders. Remote
    supervision technologies automate certain routine supervision tasks
    which free officer time for other supervision activities and allow
    probation and pretrial services offices to manage their growing
    workload.
                                   conclusion
        Chairman Gregg, Senator Hollings and members of the subcommittee, I
    hope I have met my goal of impressing upon you the integral role the AO
    plays in the administration of justice as well as the effective and
    efficient management of the resources this subcommittee provides the
    Third Branch. I am proud of the achievements of the AO and am committed
    to continue to improve the level of service the AO provides the courts
    and the public. I ask for your support in achieving this goal by
    providing the AO with the modest funding increase requested for fiscal
    year 2002. Thank you for giving me the opportunity to be here today,
    and I am available to answer any questions.
                                     ______

     Prepared Statement of Hon. Fern M. Smith, Director, Federal Judicial
                                     Center
        Mr. Chairman, members of the subcommittee: My name is Fern Smith. I
    have been a U.S. district judge since 1988 and director of the Federal
    Judicial Center since 1999.
        The Center is grateful for the 4.5 percent increase in our 2001
    appropriation, our first current services appropriation since 1992.
    This statement summarizes our 2002 request and, to put that request in
    context, describes Center activities that serve our statutory mission:
    ``to further the development and adoption of improved judicial
    administration'' through education and research. I have grouped those
    activities under some major challenges facing the federal judicial
    system: fair and efficient disposition of litigation; alternative
    methods of resolving disputes; sentencing, offender supervision, and
    prisoner litigation; science in the courtroom; responsibilities under
    the codes of conduct; court management; implementing technological
    change; and globalization of commerce and crime; rule of law assistance
    to emerging democracies.
                                  2002 request
        The requested 2002 appropriation of $20,323,000 is based on our
    recurring assessment of judge and staff educational needs as revealed
    by our advisory committees and surveys, and by actions of Congress, the
    Judicial Conference, and the Sentencing Commission. Our research
    program is structured primarily by requests from committees of the
    Judicial Conference. Research projects often provide the bases for our
    educational programs.
        Basically, we seek in 2002 to increase our non-travel educational
    services to meet the growing demand for them while maintaining our
    education seminars, albeit at the reduced levels required by our
    appropriations. In all cases, our objective is to provide federal
    courts practical, job-related education that reflects competing,
    legitimate approaches to particular problems.
        The Center's statutory Board, which the Chief Justice chairs,
    unanimously approved the request before you today. It represents an 8.5
    percent increase, providing adjustments to base and ten automation and
    video positions. The request is consistent with the Center's long-term
    trend toward greater use of distance--education education that does not
    require travel. Over 90 percent of those who used the Center's
    educational services last year did so through distance education, or
    ``e-learning'' as some now say.
        Last year, at the request of the Chairman of the House Commerce,
    Justice, State and the Judiciary Appropriations Subcommittee the Center
    and the Administrative Office provided a paper documenting the judicial
    branch's use of technology. The following chart from that
    paper illustrates the Center's increasing use of e-learning. deg.
    Participants in FJC Seminars, and in Programs Using Distance Education,
            by Year
        As explained in that paper, educational technologies include:
      --The Federal Judicial Television Network (FJTN) created in 1998 to
            transmit education and information by satellite to over 300
            federal court sites where the Administrative Office has
            installed downlinks. The first results of a statistical method
            we created to measure FJTN viewership suggest that viewership
            of FJC broadcasts may be as much as 80 percent larger than
            informal estimates that were based on 1999 data.
      --Two-way videoconferencing for training that involves only a few
            locations.
      --Web-based education--our internal judicial branch Web-site provides
            interactive tutorials, online seminars and workshops, and
            exchanges where court-training specialists throughout the
            country can pose questions to trainers who have dealt with
            particular problems, view other courts' training databases, and
            obtain electronic copies of resource materials.
      --Curriculum packages for in-court use--the Center has prepared over
            50 specialized training packages for court managers to adapt
            for their own training needs for example, teaching probation
            officers to conduct financial investigations. These packages
            have instructional guides, outlines, overhead transparencies,
            and in some cases, video supplements.
        In calendar 2000, excluding FJTN viewership, the 632 educational
    programs sponsored by the Center or using Center materials had 23,419
    participants. Of those programs, 590 programs, with 20,351
    participants, were distance education programs. In addition, we
    estimate that our FJTN programs had almost 30,000 viewers.
        Since 1992, the Center's FTEs have declined by 16. The Center's
    appropriation was $18,895,000 in 1992 and is $18,736,000 in 2001, a
    decrease in current services dollars of more than $7,000,000.
    Meanwhile, the number of judges and court employees has grown, and the
    range and complexity of issues they deal with have expanded. A greater
    variety of educational technologies has helped us deal with increased
    educational requirements with a smaller staff and appropriation, but
    these technologies require skilled employees to support them. The
    requested program increase for 2002 is for ten additional positions to
    support our video and Web-based education.
        Five of the additional positions are for our video staff, to allow
    us to update our educational programs on videocassettes and to meet
    demands for additional videos, while continuing to manage the FJTN as
    well as expand it to provide a full day's broadcast schedule for courts
    in the western time zones. The FJTN's creation has significantly
    expanded our workload, but we have been able to add only one-and-a-half
    positions to our video staff by internal reallocations. The current
    staff manages the network for Center broadcasts (including those we
    produce with the Sentencing Commission) and for Administrative Office
    broadcasts. This entails producing live studio programs, operating the
    technology to transmit over 1,880 hours of annual programming to the
    satellite uplink, and producing the monthly broadcast schedule for use
    by federal courts across the country. Our video staff also designs,
    films, and edits educational videos that are used in some FJTN
    broadcasts, in our judicial orientation programs, and by courts around
    the country in local education programs. We have a growing backlog of
    needs. Many of the educational videos we use need to be replaced--some
    are over ten years old.
        The other five positions will let us expand the online computer
    conferences we provide the courts, place more interactive training and
    reference tools on our Web site, convert onto the Web our training
    tutorials now on CD-ROM and computer disc, and develop online
    inventory, ordering, and distribution services for Center educational
    publications and videocassettes. We also want to use our Web site to
    facilitate collaborative research, such as a site we have been asked to
    set up to facilitate collaboration by expert witnesses in analyzing
    proposed rule changes to accommodate electronic discovery. Additional
    technological personnel will not only help increase service to the
    courts over our Web site on the judicial branch intranet, but will
    increase service to the public over our Internet site by making our
    research products and appropriate educational programs available to
    wider audiences.
                         center services and activities
        We use a variety of methods and technologies to deliver education
    and information to the judicial branch. These include, in addition to
    the e-learning methods described above, in-person seminars and both
    electronic and print publications. Our curriculum packages, as well as
    our publications and satellite broadcasts, enable the courts to tailor
    educational programs developed at the national level to meet local
    needs.
    Fair and efficient disposition of litigation
        Center education programs stress the judge's responsibility to
    dispose of cases fairly, quickly, and inexpensively. This is the major
    theme of the initial orientation seminars for newly appointed judges,
    although the videos we use in these programs are increasingly dated.
        We also stress case management in our continuing education
    seminars, which provide vehicles for judges from different courts to
    compare effective techniques and procedures. We also use distance
    learning tools when they can be effective. For example, we have in
    place contingency plans to use the FJTN and our cycle of continuing
    education seminars to explain to bankruptcy judges and clerks new
    responsibilities created by the bankruptcy legislation now under
    consideration.
        Other Center products provide judges with ready sources of advice
    on particular aspects of case management and legal trends. Examples
    include the following manuals and desk references:
      --Manual on Recurring Problems in Criminal Trials (4th ed., in
            revision);
      --Benchbook for U.S. District Court Judges (4th ed., rev. 2000);
      --Manual for Litigation Management and Cost and Delay Reduction
            (1992)--the basis for the revised manual approved this year by
            the Judicial Conference in compliance with the Civil Litigation
            Reform Act;
      --Manual for Complex Litigation, Fourth (in production);
      --Case Studies of Mass Tort Limited Fund Class Action Settlements &
            Bankruptcy Reorganizations (2000) and a forthcoming guide--both
            deal with alternative approaches to the management of complex
            mass tort litigation;
      --The Use of Visiting Judges in the Federal District Courts: A Guide
            for Judges & Court Personnel (2001)--to assist the process of
            providing courts temporary assistance in managing their
            dockets; and
      --Case Management Procedures in the Federal Courts of Appeals
            (2000)--to describe procedures and practices that courts of
            appeals have used effectively.
        FJTN broadcasts include the following:
      --``New Amendments to the Federal Rules of Civil Procedure and
            Federal Rules of Evidence'' (in cooperation with the American
            Law Institute-American Bar Association);
      --``The Supreme Court Term in Review''--an annual broadcast to inform
            judges and their law clerks of decisions that will affect the
            litigation before them;
      --``Bankruptcy Law Updates'' (released periodically); and
      --numerous broadcasts for clerks' office staff.
        The Center this year has begun a multiyear research project to
    update the case weights used by the Judicial Conference for determining
    judgeship needs.
    Alternative methods of resolving disputes
        The Alternative Dispute Resolution Act of 1998 directed district
    courts to offer litigants alternatives to traditional litigation.
    Center activities to implement the statute include:
      --an FJTN broadcast soon after passage to inform the courts of the
            statute's requirements, and a national seminar for ADR
            administrators from all districts with specific instructions on
            how administrators can meet their responsibilities under the
            Act;
      --recurring seminars to teach mediation skills to magistrate judges
            and appellate conference attorneys; and
      --Judicial Guide to Managing Cases in ADR (2001, in production) and
            previous publications on federal court ADR, to advise the
            courts on how to implement sound ADR programs and use them
            effectively.
    Sentencing, offender supervision, and prisoner litigation
        Federal sentencing and offender supervision policies are shaped by
    statutes, the sentencing guidelines, and case law. Center activities in
    these areas include:
      --periodic sentencing policy institutes, in cooperation with the
            Judicial Conference Committee on Criminal Law, the Sentencing
            Commission, and the Bureau of Prisons;
      --FJTN programs, including ``Charging and Sentencing after
            Apprendi,'' about the case law applying the Supreme Court's
            decision last June on permissible sentence enhancements; our
            ``Special Needs Offender'' series (monographs and FJTN
            broadcasts about offenders whose supervision presents special
            problems, including gang members, cyber-criminals, and white-
            collar criminals); ``Recurring Issues in Federal Death Penalty
            Cases,'' for judges assigned capital cases; and a series of
            programs on application of the guidelines, produced in
            cooperation with the Sentencing Commission;
      --print and electronic publications, including Resource Guide on
            Federal Capital Cases (2001), an online resource based on
            experiences of judges in cases in which the Justice Department
            sought the death penalty; Guideline Sentencing Update,
            summarizing recent decisions interpreting the legislation and
            guidelines; and Financial Investigation Desk Reference for
            Probation and Pretrial Services Officers (Dec. 2000 ed.); and
      --``Risk Prediction Index,'' a statistical instrument to help
            probation officers predict an offender's risk of recidivism;
            the Center has recently adapted it for pretrial uses.
        We are presently unable to meet the need for biannual video and
    Web-based scenarios to sharpen probation and pretrial services
    officers' responses to defendant and offender incidents; safety skills
    should be routinely honed so reactions are automatic. With additional
    media staff we could develop federal court specific foreign language
    video and audiotapes for officers and front-office staff.
        Prisoner litigation challenging sentences and conditions of
    confinement also make up substantial portions of some dockets and are
    treated in Center seminars on Sec. 1983 litigation.
    Science and statistics in the courtroom
        The Chief Justice said in January, ``Federal judges today face
    cases involving complicated statutes and factual assertions, many of
    which straddle the intersections of law, technology, and the physical,
    biological, and social sciences. FJC education programs and reference
    guides help judges sort out relevant facts and applicable law from the
    panoply of information with which the adversary system bombards them.
    The FJC thus contributes to the independent decision making that is the
    judge's fundamental duty.''
        Center products to help federal judges exercise the responsibility
    assigned them by the Supreme Court in assessing the suitability of
    scientific and technical evidence include the following:
      --Reference Manual on Scientific Evidence (2d ed. 2000), which has
            been widely reprinted by private publishers;
      --``Science in the Courtroom,'' a six-part FJTN series on such topics
            as microbiology, DNA, and toxicology, analyzed in the context
            of evidentiary hearings; and
      --Center educational seminars for small groups of judges on basic
            issues of science in litigation, the impact of new technologies
            on intellectual property law, environmental law, and law and
            the Internet.
        A prime reason for which we seek to increase our automation staff
    is to provide judges with online, interactive instructional tools to
    help deal with complex evidence.
    Responsibilities under the codes of conduct
        Judges and court employees operate under a mix of statutory and
    administrative rules to avoid conflicts of interest or their
    appearance. The Center has stepped up its education in this area to
    help ensure that all judges and employees understand these rules.
      --Judicial ethics is a major topic at the Center's initial
            orientation seminars. Only this year will we be able to replace
            the instructional videos we have been using since 1991.
            Judicial ethics has also been the subject of at least one
            session at each of our general continuing judicial education
            programs for the last three years.
      --A curriculum program for in-court programs, now used by over 7,000
            employees, that explains the code of conduct for federal court
            employees.
      --A one-hour segment of the Center's annual FJTN orientation for new
            judicial law clerks uses a series of hypothetical cases to
            alert clerks to their ethical obligations. Those hypotheticals
            were produced in 1998 and will soon need updating.
    Court management
        Effective use of public resources is a challenge in all three
    branches of government. The Center uses various means to help judges
    (especially chief judges) and court managers apply sound management
    principles and provide effective leadership. They include:
      --Deskbook for Chief Judges of U.S. District Courts (2d ed., in
            revision), which explains chief judges' formal and informal
            obligations and lessons from private sector management
            experience. Additional automation staff would help us place the
            new edition online with links to relevant sources.
      --We hope also to produce a video for new chief judges in which
            experienced chief judges describe the challenges new ones are
            likely to face.
        Teaching management skills requires some personal interaction. The
    Center provides:
      --conferences for chief judges (annual for district chiefs, and
            biennial for bankruptcy chiefs);
      --seminars to help teams of chief judges and managers devise
            strategies and implement strategic plans for effective
            operations;
      --biennial conferences for senior court managers;
      --multiyear leadership development programs to develop mid-level
            managers' leadership skills for current and senior management
            positions; and
      --management education modules for local training on such topics as
            performance management and employee relations.
    Implementing technological change
        Projects to help manage the impact of technology on the judicial
    process include:
      --Effective Use of Courtroom Technology: A Judges Guide to Pretrial
            and Trial (spring 2001, print and CD-ROM)--developed with the
            nonpartisan National Institute of Trial Advocacy, it provides
            guidance on the procedural, evidentiary, and substantive issues
            that arise when a court is equipped with evidence display,
            videoconferencing, and other technologies, or when lawyers
            bring that equipment to the courtroom for a particular case. It
            describes what the lawyers hope to accomplish with the
            technology and analyzes the evidentiary objections opponents
            are likely to raise and the considerations of fairness that
            attend the various uses of technology.
      --Electronic case-filing tutorials for the bar--the Center has
            developed two prototype computer-based training courses for use
            in district and bankruptcy courts that permit lawyers to file
            cases electronically. Courts that are now using electronic
            filing have adapted our tutorial as the teaching tool for
            showing lawyers how to use the electronic filing system in
            their courts.
      --The cost of pretrial discovery is increasingly affected by
            discoverable materials being stored in electronic formats,
            including outmoded formats. The Center, anticipating the
            growing impact of this problem on civil case management, began
            studying it several years ago and now responds to bench and bar
            groups' requests for advice on electronic discovery management,
            cost reduction, and the appropriate use of computer experts;
            sample discovery orders and protocols; and plain-English
            explanations of the relevant technology.
    Globalization of commerce and crime; rule of law assistance to emerging
            democracies
        About a third of federal judges at least occasionally face problems
    in transnational litigation, such as service of process, discovery in
    foreign countries, and disputes over choice of law or jurisdiction.
    This type of litigation will increase. Services to help judges include:
      --a monograph to be published this year on international insolvency,
            and
      --development of additional monographs on international law and
            transnational legal topics, in cooperation with the American
            Society for International Law.
        Globalization has also led foreign judges and officials to turn to
    the United States to learn about the effective administration of
    justice. The Center, pursuant to a statutory mandate, provides
    assistance to foreign visitors through briefings at its Washington
    offices (last year for over 300 judges and officials from 40
    countries). Center staff also provide occasional technical assistance
    when consistent with our primary domestic obligations. For example:
      --in cooperation with Puerto Rico's Interamerican Center for the
            Administration of Justice, assisting Latin American judges,
            prosecutors, and defenders to understand common-law criminal
            procedures, which hemispheric countries are implementing to
            increase accountability and reduce corruption;
      --assisting India, Namibia, and Zambia to implement case-management
            programs and alternatives to traditional procedures in order to
            improve the resolution of legal disputes; and
      --assisting the Russian Academy of Justice to develop as a
            counterpart institution to the Federal Judicial Center.
        Center education for federal court personnel on transnational
    issues uses its appropriated funds. Its assistance to foreign
    judiciaries, however, is funded by other government agencies and
    private organizations.
        Mr. Chairman, I appreciate this opportunity to describe the
    Center's work and explain our budgetary needs for the next fiscal year.
    We are proud of our ability to adapt technology to education and avoid,
    for the last five years, requests for increased funds for travel. In
    candor, I must tell you that we have probably reached the limits of our
    ability to meet the growing needs of the courts without some additional
    support for traditional educational methods. This year, however, we
    again seek only to enhance our technological personnel.
        I will be pleased to answer any questions you may have.
                                     ______

    Prepared Statement of Diana E. Murphy, Chair, United States Sentencing
                                   Commission
                                  introduction
        Mr. Chairman, members of the Committee, thank you for the
    opportunity to submit a statement on behalf of the United States
    Sentencing Commission's appropriation request for fiscal year 2002. The
    Sentencing Commission was reborn when a full complement of seven voting
    commissioners finally was appointed on November 15, 1999, and I am
    pleased to serve as Chair of this important agency.
        The Sentencing Commission is a small independent agency within the
    judicial branch. Because of a very long period when there were no
    commissioners, the agency's budget was dramatically cut and staff
    levels dropped by approximately 20 percent. The effect of the
    substantial cut in staff was not immediately felt because when there
    were no commissioners to set an agenda or to vote on amendments, the
    staff had uninterrupted time to work on background materials in
    response to new criminal statutes and legislative directives to prepare
    for the day when a Commission was again appointed. This work product
    was then ready for the new Commission, and it included legislative
    history reviews, sophisticated data analysis, extensive case law
    research, and various policy options with intricate draft guideline
    options for consideration. This background work enabled the new
    Commission to accomplish much during its first amendment cycle ending
    May 1, 2000.
        Once the Commission embarked upon new work, however, it fully
    experienced the inadequacy of the staffing level which had been cut by
    one-fifth. We are simply unable to do the job Congress gave us in the
    Sentencing Reform Act unless our staff is replenished towards its
    earlier level. The Commission requests an appropriation of $12,400,000
    for fiscal year 2002 to enable us to begin to restore staffing levels
    necessary to carry out our statutory duties.
        We look forward to strengthening our good working relationship with
    Congress and others in the federal criminal justice community, and hope
    that Congress will reaffirm its belief in the mission of the Commission
    and its confidence in us by fully funding our request for fiscal year
    2002. The Commission has begun to rebuild its policymaking function
    envisioned by Congress under the Sentencing Reform Act of 1984.
        During our tenure at the Commission, the agency has devoted most of
    our resources toward clearing the backlog of legislative directives. We
    have worked hard to make substantial progress, promulgating amendments
    covering sexual offenses against children, intellectual property
    infringement, identity theft, counterfeiting, money laundering, illegal
    firearm sales and possession, immigration offenses, and methamphetamine
    offenses, to name a few. We also have been updating several guidelines
    and creating new guidelines to incorporate new federal criminal
    offenses into the guidelines and to respond to the continuing flow of
    new congressional directives on important matters such as human
    trafficking, methamphetamine and amphetamine manufacturing, and ecstasy
    trafficking.
        Many of our varied constituents, including Congress, the executive
    branch, and the Judicial Conference of the United States, have sought
    our technical expertise and judgment about perceived guideline
    problems. Areas of concern include the need to ensure that federal
    prisons are being used to incapacitate adequately offenders with
    extensive criminal histories and high recidivism rates rather than
    first time, non-violent offenders; an examination of perceived
    difficulties with totally quantity driven drug sentencings rather than
    greater reliance on penalties based upon an offender's culpability and
    role in the offense; a review of the sentencing guidelines in light of
    the holding in New Jersey v. Apprendi, 120 S. Ct. 2348 (2000) (holding
    that, other than the fact of a prior conviction, any fact that
    increases a penalty for a crime above the statutory maximum must be
    submitted to a jury and proved beyond a reasonable doubt); and an
    analysis of mandatory minimum penalties in the federal system.
        The agency has also experienced a surge in demand for sentencing
    data, expert testimony, and training on guideline application. We
    cannot meet the demands expressed here with current staff levels.
    Therefore, the Commission's human resource needs necessarily have
    increased.
                              resources requested
        The Commission's budget request for fiscal year 2002 is
    $12,400,000. We understand budget increases are generally hard to
    justify, but the Commission continues to struggle from the budget
    reductions made in the absence of voting commissioners that occurred
    through fiscal year 2000. The agency's fiscal year 2000 funding was
    lower than the average funding level over the last ten years, yet
    demands on staff resources, including case filings, the number of
    proposed guideline amendments, and training requests, have all
    increased with the appointment of a full and active slate of
    commissioners.
                                 justification
    Sentencing Reform Act Requirements
        The Commission was created under the Sentencing Reform Act of 1984
    as a permanent, independent agency within the judicial branch. Congress
    gave the Commission a dual mission: (a) to establish a national
    guideline system for federal sentencing policies and practices; and (b)
    to serve as an expert agency and leading authority on federal
    sentencing matters.
        In fulfilling these basic requirements, the Commission annually
    issues a sentencing guidelines manual that delineates penalty levels
    for all federal offenses. In addition to encompassing all federal
    offenses, the guideline manual incorporates amendments approved by the
    Commission for newly enacted crime legislation passed by Congress. The
    guideline manual is used by prosecutors, defense counsel, and probation
    officers in making sentencing recommendations to the court. Federal
    district judges must use the guideline manual when imposing a sentence,
    and it must also be relied upon by all federal appellate judges and the
    justices of the United States Supreme Court when reviewing the imposed
    penalties. Since the first manual went into effect on November 1, 1987,
    over half a million defendants have been sentenced under the guideline
    system.
        In fulfilling the second component of its ongoing mission, i.e., to
    serve as an expert agency and leading authority on federal sentencing
    matters, the Commission was given continuing statutory responsibility
    and authority in many areas, including--
      --ensuring that sentencing policies and practices provide certainty
            and fairness, that they avoid unwarranted sentencing
            disparities while maintaining enough flexibility for
            individualized sentences when those are warranted, and that
            they reflect advancements in our knowledge of human behavior as
            it relates to the criminal justice process;
      --developing means to measure the effectiveness of sentencing, penal,
            and correctional practices in meeting the purposes of
            sentencing;
      --monitoring the performance of probation officers regarding
            sentencing recommendations, including application of the
            guidelines;
      --issuing instructions to probation officers concerning the
            application of the guidelines;
      --establishing a research and development program within the
            Commission to serve as a clearinghouse and information center
            for information on Federal sentencing practices;
      --consulting with federal courts, departments, and agencies in
            developing, maintaining, and coordinating sound sentencing
            practices;
      --systematically collecting data from studies, research, and the
            empirical experience of public and private agencies concerning
            the sentencing process;
      --publishing data concerning the sentencing process;
      --systematically collecting and disseminating information concerning
            sentences actually imposed on more than 61,000 cases sentenced
            in the Federal district courts each year (and on about 1,000
            appellate decisions on sentencing) and the relationship of
            those sentences to the factors judges are required to consider
            under 18 U.S.C. Sec. 3553(a);
      --systematically collecting and disseminating information regarding
            the effectiveness of sentences imposed;
      --conducting seminars and workshops around the country to provide
            continuing studies for people engaged in the sentencing field;
      --conducting periodic training programs for judicial and probation
            personnel and other persons connected with the sentencing
            process;
      --making recommendations to Congress on changes that might be made to
            statutes relating to sentencing, penal, and correctional
            matters that would help to carry out effective, humane, and
            rational sentencing policy;
      --holding hearings and calling witnesses to assist the Commission in
            the exercise of its powers and duties;
      --recommending any changes in prison facilities that may be necessary
            because of the sentencing guidelines; and
      --performing any other functions necessary to permit federal courts
            and others in the federal criminal justice system to meet their
            responsibilities in the sentencing area.
    Commissioners Face Critical Backlog of Legislation
        The work of the Commission is generally determined by three
    sources: (1) legislative directives by Congress contained in crime
    legislation; (2) resolution of conflicting interpretations of
    sentencing guidelines among the circuit courts of appeals; and (3)
    internal priorities that are set by the commissioners following an
    annual solicitation published in the Federal Register. Due to the
    extended absence of voting commissioners, the current Commission faces
    an ambitious policy agenda addressing the significant backlog of
    legislation. These legislative matters cover a wide range of criminal
    conduct of great concern to Congress and members of the federal
    criminal justice system:
      --Intellectual Property Offenses.--In response to a directive
            contained in the No Electronic Theft (``NET'') Act of 1997, in
            April 2000, the Commission promulgated a temporary emergency
            amendment that was subsequently made permanent which made
            comprehensive changes to the copyright and trademark
            infringement guideline.
      --Telemarketing Fraud.--In response to a directive contained in the
            Telemarketing Fraud Prevention Act of 1998, in April 2000, the
            Commission promulgated a permanent amendment that provides for
            three separate sentencing enhancements for fraud offenses that
            involve mass marketing, a large number of vulnerable victims,
            and the use of sophisticated means to carry out the offense.
            The action made a temporary emergency amendment a permanent
            amendment to the guidelines.
      --Telephone Cloning.--In response to a directive contained in the
            Wireless Telephone Protection Act of 1998, in April 2000, the
            Commission promulgated an amendment to the fraud guideline that
            provides an appropriate sentencing enhancement for these
            offenses.
      --Identity Theft.--In response to a directive contained in the
            Identity Theft and Assumption Deterrence Act of 1998, in April
            2000, the Commission promulgated an amendment to the fraud
            guideline that provides an appropriate sentencing enhancement
            for violations of 18 U.S.C. Sec. 1028 (relating to fraud in
            connection with identification documents).
      --Methamphetamine and Amphetamine Trafficking.--In response to the
            Methamphetamine Trafficking Penalty Enhancement Act of 1998,
            which reduced by one-half the quantity of methamphetamine
            required to trigger various mandatory minimum sentences in the
            drug statutes, in April 2000, the Commission promulgated an
            amendment to the guidelines' drug quantity table that accounts
            for these increased mandatory minimum penalties. In response to
            an emergency directive in the Methamphetamine Anti-
            Proliferation Act of 2000, in December 2000, the Commission
            amended the drug guidelines to provide significant sentencing
            enhancements for methamphetamine and amphetamine manufacturing
            that creates a substantial risk of harm to human life, the
            environment, minors, and incompetents. In February 2001, in
            response to another emergency directive in the Act, the
            Commission voted to increase the penalties for amphetamine
            offenses such that they are identical to the penalties for
            methamphetamine offenses. Also in response to an emergency
            directive contained in the Act, the Commission is considering
            options for increasing the penalties for offenses involving
            certain precursors of methamphetamine.
      --Human Trafficking.--In response to an emergency directive contained
            in the Victims of Trafficking and Violence Protection Act of
            2000, in February 2001, the Commission voted to amend the
            guidelines applicable to peonage, involuntary servitude, slave
            trade offenses, and possession, transfer, and sale of false
            immigration documents in furtherance of such trafficking, and
            the Fair Labor Standards Act and the Migrant and Seasonal
            Agricultural Worker Protection Act to reflect the heinous
            nature of these offenses. The amendment accounts for new
            offenses and increased statutory maxima created by the Act.
      --Protection of Children.--In response to a directive contained in
            the Protection of Children from Sexual Predators Act of 1998,
            in April 2000, the Commission amended the guidelines pertaining
            to certain sexual abuse offenses and distribution of child
            pornography that, among other things, provides enhancements for
            use of a computer in connection with a sexual abuse offense
            against a minor and misrepresentation of an offender's identity
            in connection with such an offense. The Commission currently is
            considering additional changes to these guidelines to provide
            increased penalties for violations of chapter 117 of title 18
            and for sexual offenses against children that involve a pattern
            of activity.
      --Firearms Offenses.--In response to Public Law 105-386, which
            amended 18 U.S.C. Sec. 924(c) to create a tiered system of
            mandatory minimums and presumed maxima in cases in which a
            firearm is involved in a crime of violence or drug trafficking
            offense, in April 2000, the Commission promulgated an amendment
            which incorporated the new tiered sentencing scheme into the
            guideline pertaining to violations of section 924(c). In
            addition, the Commission currently is considering options for
            addressing a recommendation by the Bureau of Alcohol, Tobacco
            and Firearms to provide increased penalties for offenses
            involving more than 100 firearms.
      --Ecstasy.--In response to an emergency directive contained in the
            Ecstasy Anti-Proliferation Act of 2000, the Commission
            currently is considering options for increasing the penalties
            for the manufacture, importation, or trafficking of ecstasy and
            other ``club drugs'' so that they are comparable to penalties
            for other drugs of abuse.
      --Stalking.--In response to a directive contained in the Victims of
            Trafficking and Violence Act of 2000, the Commission currently
            is considering options for increasing penalties for certain
            stalking and domestic violence offenses.
      --College Scholarship Fraud.--In response to a directive contained in
            the College Scholarship Fraud Prevention Act of 2000, the
            Commission is considering options for providing enhanced
            penalties for offenses involving fraud or misrepresentation in
            connection with the obtaining or providing of information to
            consumers regarding college scholarships, loans, and grants.
      --Nuclear, Biological, and Chemical Weapons.--In response to the
            Chemical Weapons Implementation Act of 1998, and a sense of
            Congress expressed in the National Defense Authorization Act
            for Fiscal Year 1997, the Commission currently is considering
            options to provide increased penalties for offenses involving
            the importing and exporting of nuclear, biological, and
            chemical weapons.
    Commissioners Face Large Number of Circuit Conflicts
        In addition to sentencing related legislation and other policy
    initiatives, the Commission has identified a large number of
    conflicts--over 40--among the United States Circuit Courts of Appeal
    regarding interpretation of the guidelines accrued during the absence
    of voting commissioners. In Braxton v. United States, 500 U.S. 344
    (1991), the United States Supreme Court unanimously acknowledged that
    the Commission has the initial and primary task of eliminating
    conflicts among the circuit courts with respect to statutory
    interpretation of the guidelines.
        Of course, the Commission cannot resolve all of these conflicts in
    one or two years, but the Commission has made substantial progress in
    reducing the number of outstanding circuit conflicts. In April 2000,
    the Commission promulgated amendments that resolved five circuit
    conflicts regarding (i) the circumstances for which a court may
    downward depart from the sentencing guideline range for aberrant
    behavior; (ii) whether the enhanced penalties in Sec. 2D1.2 (Drug
    Offenses Occurring Near Protected Locations or Involving Underage or
    Pregnant Individuals) apply only when the defendant is convicted of an
    offense referenced in that guideline or, alternatively, whenever a
    defendant's relevant conduct included drug sales in a protected
    location or involving a protected individual; (iii) whether the
    enhancement in the fraud guideline for violation of a judicial or
    administrative order, injunction, decree, or process applies to falsely
    completing bankruptcy schedules and forms; (iv) whether sentencing
    courts may consider post-conviction rehabilitation while in prison or
    on probation as a basis for downward departure at resentencing
    following an appeal; and (v) whether a court can base an upward
    departure on conduct that was dismissed or uncharged as part of a plea
    agreement.
        Several of the proposed amendments discussed above, if enacted,
    will resolve a number of additional circuit conflicts. Apart from those
    amendments, the Commission also is considering options for resolving
    circuit conflicts relating to: (i) whether admissions made by the
    defendant during his guilty plea hearing, without more, can be
    considered ``stipulations'' for purposes of Sec. 1B1.2(a); (ii) whether
    the four-level enhancement in the aggravated assault guideline for use
    of a dangerous weapon during an aggravated assault is impermissible
    double counting in a case in which the weapon that was used was a non-
    inherently dangerous weapon; (iii) whether the enhancement in the fraud
    guideline for misrepresentation that the defendant was acting on behalf
    of a charitable, educational, religious, or political organization, or
    a governmental agency applies to a defendant who does work on behalf of
    such an entity, but illegally diverts all or part of the benefits; and
    (iv) whether a reduction for mitigating role is precluded in the case
    of a single defendant drug courier if the defendant's base offense
    level is properly determined solely by the quantity personally handled
    by the defendant.
    Commissioners Address Long-Standing Policy Issues
        The Commission also has worked hard to address certain policy
    initiatives that at different points in time have been supported by
    various constituents, including the Department of Justice and the
    Committee on Criminal Law of the United States Judicial Conference.
    However, because of the absence of voting commissioners and subsequent
    lack of resources, these initiatives could not be completed.
      --Economic Crime Guidelines.--The Commission currently is considering
            a comprehensive reassessment of the guidelines pertaining to
            economic crimes. Economic offenses account for more than a
            quarter of all the cases sentenced in the United States federal
            district courts. The Commission has received from the Federal
            Judiciary and the Department of Justice testimony and survey
            results that indicate that the sentences for these offenses are
            inadequate to punish appropriately defendants in cases in which
            the monetary loss was substantial. After a number of years of
            data collection, analyses, public comment, and public hearings,
            the Commission developed a comprehensive ``economic crime
            package'' designed to revise the loss tables for fraud, theft,
            and tax offenses in order to impose higher sentences for
            offenses involving moderate and large monetary losses. Related
            amendments would consolidate the theft, fraud, and property
            destruction guidelines and clarify the definition of loss for
            selected economic crimes. Our work in this area has been
            extensive. Working in conjunction with the Criminal Law
            Committee of the Judicial Conference, the Commission conducted
            a field test of the proposed loss definition by surveying
            federal judges and probation officers and applying the new
            definition to actual cases. The results generally were
            favorable, with more than 80 percent of the judges preferring
            the results obtained with the proposed loss definition over the
            current definition. In addition, in October 2000, the
            Commission sponsored a two-day National Symposium on Federal
            Sentencing Policy for Economic Crimes and New Technology
            Offenses at the George Mason University School of Law. The
            symposium was attended by approximately 150 judges,
            prosecutors, defense attorneys, and academicians and provided
            valuable input on the proposed package that the Commission
            currently is considering as it deliberates on the package.
      --Money Laundering.--Closely related to the economic crimes package,
            the Commission has been working with the Department of Justice
            to develop a revision to the money laundering guidelines that
            would more accurately capture the seriousness of the money
            laundering offense conduct. The Commission is considering a
            guideline structure that would tie more closely the penalties
            for money laundering to the penalties for the underlying
            offense that generated the criminally derived proceeds and
            would provide appropriate sentencing enhancements for
            aggravating money laundering conduct.
      --Counterfeiting.--In response to recommendations from the Department
            of Treasury, in February 2000, the Commission voted to provide
            increased penalties for (1) manufacturers of large amounts of
            counterfeit currency and (2) offenders who possess
            counterfeiting paper similar to the distinctive paper used by
            the United States, or a feature or devise essentially identical
            to a distinctive counterfeit deterrent used by the United
            States. This amendment to the counterfeiting guideline
            addresses recent changes in how counterfeit currency is
            produced. Previously, defendants operated expensive printing
            presses and manufactured large amounts of counterfeit currency
            at one time. Consequently, when these offenders were arrested
            they typically were caught with large inventories of
            counterfeit currency, which would result in increased
            penalties. Because of the advent of new and inexpensive
            technology, such as laser printers, and the availability of
            illegal copies of currency on the Internet, offenders now
            generally print counterfeit currency on an ``as needed'' basis,
            with no substantial accumulation of inventory. Thus, an
            alternative mechanism to achieve increased sentences was needed
            for this class of offenders.
      --Safety Valve.--In order to ensure that federal prison space is used
            to punish serious offenders, the Commission is considering an
            amendment that would expand the applicability of the two-level
            reduction for non-violent, first time drug offenders who meet
            the safety valve criteria set forth at 18 U.S.C.
            Sec. 3553(f)(1)-(5) to defendants who currently receive a
            sentence below five years.
    Restoration of Personnel Needed to Meet Other Statutory Duties
        While the commissioners continue to work to reduce the backlog of
    unimplemented crime legislation, the human resource needs of the agency
    will increase as the routine annual amendment cycle is reestablished,
    new policy initiatives are identified by the reconstituted Commission,
    and new crime legislation is enacted by Congress. In order to become a
    fully functional agency that performs all of its statutory functions in
    an exemplary manner, a restoration of personnel is necessary,
    particularly in the following areas:
                Commission Contending with Sharp Increase in Caseload
        The Commission maintains a comprehensive, computerized data
    collection system which forms the basis for its clearinghouse of
    federal sentencing information. This comprehensive database is the
    basis for the Commission's monitoring and evaluation of guidelines
    application, for many of its research projects, and for responding to
    the hundreds of data requests received from Congress and other criminal
    justice entities each year.
        In fiscal year 2000, the Commission received court documents for
    more than 61,000 cases sentenced under the Sentencing Reform Act
    between October 1, 1999, and September 30, 2000. However, the number of
    data entry employees are only one-third the number when there were far
    fewer cases. The organizational structure and physical facilities were
    set in place for 40,000 cases per year.
        For each case received, the Commission extracts and enters into its
    comprehensive database more than 260 pieces of information, including
    case identifiers, sentence imposed, demographic information, statutory
    information, the complete range of court guideline application
    decisions, and departure information. This data is vital to the
    Commission's deliberations when modifying the guidelines to timely
    adjust federal sentencing policy. For example, the Commission was able
    to detect a surge in activity regarding the new designer drug, MDMA (a/
    k/a Ecstacy) and are now re-calibrating the guidelines to deter use of
    this illegal substance. By having the source documents on sentencing,
    and relying on expert testimony gathered in briefing sessions, public
    hearings and meetings, we were able to capture the harms associated
    with this new drug and increase penalties to reflect the seriousness of
    this offense. Yet due to staff vacancies, the Commission has a backlog
    of 20,000 cases that must be processed. Unless additional staff are
    hired, the Commission will be unable to code data on each case
    sentenced under the guidelines and will be forced to rely on less
    reliable statistical sampling to guide its sentencing policy
    development and to advise Congress on crime policy.
                Research and Information Dissemination
        The Commission continues to advance its statutorily directed
    research and information dissemination through presentations of
    analyses at numerous sentencing policy symposia, including the annual
    meeting of the American Society of Criminology and the annual National
    White Collar Crime Summit. In fiscal year 2001, Commission staff made
    presentations on sentencing policy for sex offenders, important factors
    to consider when conducting disparity research, sentencing increases
    for alien smuggling, sentencing white collar crime offenses, and
    sentencing organizations.
        As noted above, the Commission also held a two-day National
    Symposium on Federal Sentencing Policy for Economic Crimes and New
    Technology Offenses. As ease and availability of new technology changes
    how traditional crimes are committed and gives rise to new crimes, the
    Commission has found that greater sophistication in sentencing policy
    is required. In order to more fully inform the Commission in this area,
    the agency gathered the country's leading experts to discuss sentencing
    issues, including computer hacking and planting of program viruses,
    intellectual property and copyright infringement, consumer fraud via
    the Internet, securities fraud, and day trading fraud.
        The agency annually publishes an updated Guidelines Manual and an
    Annual Report and accompanying Sourcebook of Federal Sentencing
    Statistics, which contains in-depth statistical charts, tables, and
    analyses on sentencing pattern and practices gathered from the agency's
    extensive database. The Commission also publishes an annual Guide to
    Publications and Resources and continues to add a variety of
    publications and sentencing data to its award winning Internet web
    site.
        An important part of the Commission's research agenda for fiscal
    year 2002 is to conduct a focused review of the guidelines and a study
    of recidivism. By fiscal year 2002, the guidelines will have been in
    place for 15 years and have been used to sentence over a half a million
    defendants. Following its statutory directive to monitor the guidelines
    to insure that they are meeting the purposes of sentencing required by
    Congress, the Commission is undertaking this valuable endeavor that
    will require the agency to devote significant staff resources to it--
    resources that currently we do not have.
        The 15 year review, as well as other important research at the
    Commission, is imperiled by a depletion of its research staff. During
    this recent period of attrition, a significant portion of the
    intermediate tier of researchers and all of the lower tier research
    associates left the agency. Thus, the Commission requests funding to
    rebuild its research staff so that we may continue to critically
    analyze sentencing patterns and practices, respond to inquiries about
    the effectiveness of sentencing policies, and thoroughly assess the
    impact of proposed guideline amendments and new sentencing related
    legislation.
                Increased Training Needs for Larger Federal Criminal
                        Justice System
        Over the last several years, as Congress has devoted increased
    resources to law enforcement, the number of federal judges,
    prosecutors, probation officers, and defense attorneys who require
    training and assistance on how to use the guidelines has increased
    accordingly. The Sentencing Reform Act requires the Commission to
    provide guideline training, in part because training promotes
    uniformity in guideline application and thereby reduces sentencing
    disparity, both goals of the Act.
        Commission staff provided training on the sentencing guidelines to
    more than 2,500 individuals at approximately 50 training programs
    across the country in 2000, including ongoing programs sponsored by the
    Commission, the Federal Judicial Center, the Department of Justice, the
    American Bar Association, and other criminal justice agencies. The
    Commission also maintains a telephone HelpLine service to answer case-
    specific guideline application inquiries from federal judges, probation
    officers, prosecuting and defense attorneys, and law clerks. To further
    expand the availability and cost efficiency of training and information
    sharing, the Commission has joined the Federal Judicial Center and the
    Administrative Office of the U.S. Courts in launching a satellite
    television network to provide cutting-edge programming on sentencing-
    related issues. The Commission makes a regular contribution to a news
    series for probation and pretrial services designed to update officers
    on important information regarding the Commission and its activities.
    However, if the Commission is not provided sufficient funding to
    restore personnel in other areas of the agency, its quality of training
    will suffer because its training staff may have to be utilized for more
    pressing projects as they arise.
        The organizational guidelines' approach to sentencing, which
    mitigates fines when effective compliance programs lead to prompt self-
    reporting and disclosure to the authorities, has spawned complementary
    efforts by a number of regulatory and law enforcement authorities.
    Executive agencies such as the Environmental Protection Agency, the
    Department of Health and Human Services, and the Department of
    Justice's Antitrust Division have developed, or are developing model
    compliance programs, programs for self-reporting, and programs for
    amnesty--all of which are modeled after some aspect of the
    organizational sentencing guidelines. Industry and peer organizations
    are forming to share ideas on ``best practices'' for compliance
    training and ethics awareness.
        As a result of its leadership in this area, Commissioners and staff
    are regularly invited to share their expertise. For example, the
    Commission and the Ethics Officer Association (EOA) in 2000 jointly
    sponsored a series of day-long regional forums about implementing these
    guidelines. The EOA is a non-profit peer organization comprising ethics
    and compliance officer representatives of for-profit and non-profit
    organizations. Its primary objective is to share ``best practices'' for
    ethics and compliance programs among members through peer-to-peer
    networking, library services, and educational efforts. In addition to
    this, Commissioners and senior staff members have addressed national
    and regional compliance organizations and responded to numerous
    inquiries on the organizational sentencing guidelines and compliance
    issues. Interest and inquiries come from governmental agencies,
    corporations, industry coalitions, non-governmental organizations, and
    academic institutions, both within the United States and overseas.
                Increased Inquiries from Congress
        With the appointment of a full complement of commissioners,
    Congress once again is turning to the Commission for advice on
    sentencing policy, a development that the Commission enthusiastically
    welcomes. In the past few months alone, the Commission provided
    testimony before the:
      --House Governmental Reform Subcommittee on Criminal Justice, Drug
            Policy and Human Resources about drug sentencing trends,
            mandatory minimums, and how these statutory penalties interact
            with the federal sentencing guidelines. The testimony included
            a great deal of data that we collected from our comprehensive
            database and updated many statistics from an earlier special
            report to Congress by the Commission on mandatory minimums. The
            Subcommittee expressed an interest in hearing more from the
            Commission about mandatory minimums.
      --Senate Criminal Justice Oversight Subcommittee about the
            Commission's overall agenda, pending amendments, particularly
            our efforts on economic crimes, and extensive data involving
            eight years of departure trends from the guideline system.
      --Senate Caucus on International Drug Control about trends and
            responses in Ecstasy availability and use.
        In addition to these welcome hearings, each year the Commission
    also informs Congress's legislative deliberations by responding to
    hundreds of congressional requests for assistance. These inquiries,
    both written and oral, include requests for federal sentencing and
    criminal justice data, analyses of proposed legislation, explanations
    of guideline operation, technical assistance in drafting legislation,
    and Commission publications and resource materials.
        With a full complement of new commissioners in place, the agency
    expects its overall activity will intensify, and requests from Congress
    and the public will greatly increase. As a result, the Commission needs
    to improve its congressional liaison activities and seeks to obtain
    additional staff for this effort.
                                   summation
        In sum, the Commission has worked very hard with limited resources
    to address the significant backlog of crime legislation that await
    implementation, long standing policy initiatives that need completion,
    and circuit conflicts that require resolution. With the necessary
    resources, the Commission expects to be well positioned by fiscal year
    2002 to begin identifying important sentencing issues and embarking on
    its own policy agenda. However, the Commissioners unanimously agree
    that we cannot undertake a policy agenda of any real significance
    without restoring our staff to appropriate levels. We are not
    requesting a revision to the Commission's full time equivalency ceiling
    of 108 employees. Rather, the Commission merely seeks the restoration
    of funds so that we can fill some of the currently existing but vacant
    positions. We simply cannot continue to operate at current capacity and
    perform our many statutory obligations and fulfill our important role
    in combating crime by maintaining an effective, certain, and fair
    sentencing system.
                                     ______

      Prepared Statement of Gregory W. Carman, Chief Judge, United States
                          Court of International Trade
        Mr. Chairman, Members of the Committee: Thank you for allowing me
    this opportunity to submit this statement on behalf of the United
    States Court of International Trade, which is a national trial-level
    federal court established under Article III of the Constitution with
    exclusive nationwide jurisdiction over civil actions pertaining to
    matters arising out of the administration and enforcement of the
    customs and international trade laws of the United States.
        The Court's budget request for fiscal year 2002 is $13,112,000,
    which is $637,000 or approximately 5.1 percent more than the available
    appropriation of $12,475,000 for fiscal year 2001. The request will
    enable the Court to maintain current services and provide funds for an
    architectural analysis of the Court's interior and exterior
    environment. I would like to specifically point out that almost 88
    percent of the Court's overall requested increase is comprised of pay
    and other standard inflationary adjustments to base.
        The United States Court of International Trade Courthouse was built
    over 35 years ago and is in need of repair and upgrades. To this end,
    the Court is requesting, for the first time since fiscal year 1989, a
    program increase of $75,000 for an architectural study of the
    Courthouse that will address the shortcomings of the building in the
    areas of security, health and overall operations of the Court and
    recommend a course of corrective action, if necessary.
        The Court's fiscal year 2002 request includes funds for
    maintaining, supporting and continuing the implementation of its new
    Case Management and Electronic Case Files System (CM/ECF) and the
    related file tracking and scanning and indexing solutions.
    Additionally, there are funds for maintaining and supporting several
    ongoing projects, specifically: (1) a networked records management and
    tracking system for all case records; (2) an online library automation
    system that enables the Judges and Court staff to search electronically
    for books and materials in the Court's Library collection; (3) the
    replacement of the Court's obsolete phone system with one that enables
    the Court to address its current and future telecommunication needs;
    and (4) the replacement of certain furniture with new ergonomic designs
    that will help to minimize the risk of injury to Court personnel. The
    Court's fiscal year 2002 request also will support the Court's
    continuing effort in education and training for the Judges and Court
    staff that will enable the Court to better fulfill its mission. Lastly,
    the fiscal year 2002 request also includes funds for the support and
    maintenance of security system upgrades implemented by the Court in
    fiscal years 1999 through 2001.
        During fiscal year 2000, the Court, in accordance with its five-
    year plan adopted in 1996, continued to design and implement projects
    that support the Court's future needs and utilize technology to enhance
    services to the Court family, the bar and the public. Several projects
    in support of that plan are expected to be implemented and continued in
    fiscal year 2002: (1) the replacement of older category 3 wire with
    enhanced category 5 wire and the installation of additional data tap
    runs for public access terminals; (2) the planning, design and
    development of an Intranet that will enhance the sharing of information
    among the Judges and staff and expand in-house training by utilizing
    automation and technology; (3) the establishment of an interactive
    training environment including new equipment and an additional
    satellite downlink that will enable Judges and staff to view and
    participate in training programs broadcast through the Federal Judicial
    Training Network; and (4) the installation of a raised platform floor
    in the Court's data center that will enable the Court to adequately
    wire the center for data and electrical connections, thereby providing
    greater flexibility and improved connectivity. The Court anticipates
    that these projects will be completed and operational by the end of
    fiscal year 2004. The continuation of fiscal year 2001 projects and the
    implementation of new initiatives will enable the Court to continue to
    build and update its infrastructure and operate more efficiently and
    effectively.
        I would like to reaffirm that the Court always has been modest in
    its appropriation requests and will continue, as it has in the past, to
    conserve its financial resources through sound and prudent personnel
    and fiscal management practices.
        The Court's ``General Statement and Information'' and
    ``Justification of Changes,'' which provide more detailed descriptions
    of each line item adjustment, were submitted previously. If the
    Committee requires any additional information, we will be pleased to
    submit it.
                                     ______

    Prepared Statement of Haldane Robert Mayer, Chief Judge, U.S. Court of
                        Appeals for the Federal Circuit
        Mr. Chairman, I am pleased to submit my statement to the Committee
    for this court's fiscal year 2002 budget request.
        Our 2002 budget request totals $20,446,000. This is an increase of
    $2,492,000 over the 2001 approved appropriation of $17,954,000. Thirty-
    four percent of the requested increase, $843,000, is for mandatory,
    uncontrollable increases in costs. The remaining increase of $1,649,000
    is for funding of additional positions and renovation of our
    courtrooms.
    Request for Program Increases
        $1,649,000 of our fiscal year 2002 request will cover in part the
    costs of four statutorily authorized positions for technical assistants
    for the court's legal staff and one additional position for the court's
    staff. The remainder of the requested increase is for courtroom
    renovations and installation of technology in one courtroom.
        Funding for Four Technical Assistants ($456,000).--The court is
    requesting four technical assistants in addition to the eight now
    approved for the court. Under the provisions of 28 U.S.C. Sec. 715(d)
    the court may appoint technical assistants equal to the number of
    judges in regular active service. The four technical assistants
    requested here, plus those currently on board, will give the court one
    technical assistant for each of the twelve active judge positions.
        The technical assistants do research and assist the court and all
    its judges in addressing technical aspects of appeals, maintaining
    consistency in precedential opinions, and otherwise fulfilling the
    court's mission. Technical assistants not only must have a law degree
    but also must have a background in science or engineering because of
    the significant number of highly technical intellectual property
    appeals handled by the court. This court has exclusive jurisdiction
    over patent appeals from 94 district courts and the Patent and
    Trademark Office. These appeals often are difficult and time consuming,
    and involve complex issues at the forefront of biotechnology, computer
    engineering, pharmacology, and other areas of science and engineering.
        The need to hire four technical assistants is critical to the
    efficient and effective operation of the court. Intellectual property
    litigation is a rapidly expanding area of the law. This is evident from
    the growing number of intellectual property cases filed with the court;
    the increasing complexity of patent issues submitted in each case; and
    the size of appendices accompanying each filing. Patent cases make up
    thirty-three percent of the court's docket.
        Funding for One Position on the Permanent Court Staff ($78,000).--
    The court requests funding to hire a full-time permanent position
    entitled Information Technology Specialist. Upon completion of a formal
    security review and assessment of the court's electronic information
    system, the National Security Agency (NSA) concluded that the court
    should hire an Information Technology Specialist. This person would
    monitor and protect the security of the court's information system. The
    Information Technology Specialist would insure that all electronic
    communications and information in judges' chambers and staff offices
    are protected and secure from compromise or unlawful release.
        Technology in the Courtroom ($215,000).--At the March 1999 session
    of the Judicial Conference of the United States, the Judicial
    Conference recognized that courtroom technologies are a necessary and
    integral part of courtrooms. Based on the Judicial Conference's
    findings and the fact that the Administrative Office of the U.S. Courts
    (AO) currently is implementing this program in courts across the
    country, the court is requesting funding to upgrade the courtroom
    technology in one of our courtrooms. The figure of $215,000 was
    provided to the court by the AO based on its experience to date with
    upgrading courtrooms.
        Funding for Courtroom Renovations ($900,000).--The court is
    requesting $900,000 for use to begin modernizing and updating the
    Federal Circuit courtrooms. The National Courts Building opened in
    1967. With the exception of replacement carpet, there have been no
    renovations or upgrades performed in the courtrooms.
        The funding will be used to renovate the courtrooms, upgrade the
    security of the Judges' benches, purchase furniture, improve counsel
    rooms, modernize the lighting, and upgrade the sound system. The
    courtrooms need to be rewired for computer use, recording equipment,
    and improved technology. This is a one-time cost and would be reflected
    as a nonrecurring expense in our 2003 budget request.
        It was recommended that the court request this funding from GSA. We
    have done so with no success. We are once again in the process of
    discussing the possibility of funding by GSA. Should we be successful
    in obtaining funding from that agency we would notify Congress and
    cancel this request.
        I would be pleased, Mr. Chairman, to answer any questions the
    Committee may have or to meet with Committee members or staff about our
    budget requests.

                           NONDEPARTMENTAL WITNESSES

                             DEPARTMENT OF COMMERCE

     Prepared Statement of the California Industry and Government Central
                        California Ozone Study Coalition

        Mr. Chairman and Members of the Subcommittee: On behalf of the
    California Industry and Government Central California Ozone Study
    (CCOS) Coalition, we are pleased to submit this statement for the
    record in support of our fiscal year 2002 funding request of $250,000
    from the National Oceanic and Atmospheric Administration (NOAA) for
    CCOS as part of a Federal match for the $8.7 million already
    contributed by California State and local agencies and the private
    sector. NOAA is currently under contract for approximately $700,000 to
    use state-of-science instrumentation to measure surface and aloft winds
    and temperatures in the CCOS study area. This request will partially
    replace funding already spent for NOAA's participation in CCOS.
        Ozone and particulate matter standards in most of central
    California are frequently exceeded. In 2003, the U.S. Environmental
    Protection Agency (U.S. EPA) will require that California submit SIPs
    for the recently promulgated, national, 8-hour ozone standard. It is
    expected that such SIPs will be required for the San Francisco Bay
    Area, the Sacramento Valley, the San Joaquin Valley, and the Mountain
    Counties Air Basins. Photochemical air quality modeling will be
    necessary to prepare SIPs that are acceptable to the U.S. EPA.
        Central California Ozone Study is designed to enable central
    California to meet Clean Air Act requirements for ozone State
    Implementation Plans (SIPs) as well as advance fundamental science for
    use nationwide. The CCOS field measurement program was conducted during
    the summer of 2000 in conjunction with the California Regional PM10/
    PM2.5 Air Quality Study (CRPAQS), a major study of the origin, nature,
    and extent of excessive levels of fine particles in central California.
    CCOS includes an ozone field study, a deposition study, data analysis,
    modeling performance evaluations, and a retrospective look at previous
    SIP modeling. The CCOS study area extends over central and most of
    northern California. The goal of the CCOS is to better understand the
    nature of the ozone problem across the region, providing a strong
    scientific foundation for preparing the next round of State and Federal
    attainment plans. The study includes six main components:
      --Developed the design of the field study
      --Conducted an intensive field monitoring study from June 1 to
            September 30, 2000
      --Developing an emission inventory to support modeling
      --Developing and evaluating a photochemical model for the region
      --Designing and conducting a deposition field study
      --Evaluating emission control strategies for the next ozone
            attainment plans
        CCOS is directed by Policy and Technical Committees consisting of
    representatives from Federal, State and local governments, as well as
    private industry. These committees, which managed the San Joaquin
    Valley Ozone Study and are currently managing the California Regional
    Particulate Air Quality Study, are landmark examples of collaborative
    environmental management. The proven methods and established teamwork
    provide a solid foundation for CCOS. The sponsors of CCOS, representing
    state, local government and industry, have contributed approximately
    $8.7 million for the field study. The federal government has
    contributed $500,000 some data analysis. In addition, CCOS sponsors are
    providing $2 million of in-kind support. The Policy Committee is
    seeking federal co-funding of $8.5 million to complete the data
    analysis and modeling portions of the study and for a future deposition
    study. California is an ideal natural laboratory for studies that
    address these issues, given the scale and diversity of the various
    ground surfaces in the region (crops, woodlands, forests, urban and
    suburban areas).
        There is a national need to address national data gaps and
    California should not bear the entire cost of the addressing these
    gaps. National data gaps include issues relating to the integration of
    particulate matter and ozone control strategies. The CCOS field study
    took place concurrently with the California Regional Particulate Matter
    Study--previously jointly funded through Federal, State, local and
    private sector funds. CCOS was timed to enable leveraging of the
    efforts for the particulate matter study. Some equipment and personnel
    served dual functions to reduce the net cost of the CCOS field study.
    From a technical standpoint, carrying out both studies concurrently was
    a unique opportunity to address the integration of particulate matter
    and ozone control efforts. To effectively address these issues requires
    federal assistance, and CCOS provides a mechanism by which California
    pays half the cost of work that the federal government should pursue.
        For fiscal year 2002, our Coalition is seeking funding of $250,000
    from the National Oceanic and Atmospheric Administration (NOAA).--
    Meteorological data were continuously collected during the CCOS field
    program. Extensive meteorological data collected as part of the field
    study can be used by NOAA to strengthen its ongoing research activities
    such as improving meteorological forecasting and providing information
    on the evaluation of the U.S. weather western boundary conditions. More
    importantly, CCOS provides data for research in the areas of air flow
    over complex terrain. Improved results obtained from this research has
    national applicability.
        Thank you very much for your consideration of our request.
                                     ______

                   Prepared Statement of the American Rivers

        Many individual programs funded by the Commerce, Justice, State,
    and the Judiciary Appropriations Subcommittee have substantial impacts
    on America's rivers. We urge that you bear these impacts in mind in
    determining levels of funding for these important government programs.
    We appreciate your committee's past commitment to important programs
    such as the Pacific Coastal Salmon Recovery Fund. We would like to
    highlight this program again for fiscal year 2002, along with the need
    for adequate funding of participation by the National Marine Fisheries
    Service in hydropower relicensing.
                      pacific salmon coastal recovery fund
        Pacific salmon are a national treasure with enormous economic,
    cultural, and environmental significance in the Pacific Northwest
    including Washington, Oregon, California, Idaho, and Alaska. A century
    ago, salmon were an anchor of the region's economy, and the United
    States was the world's largest salmon producer. But populations of
    salmon have declined dramatically over the past century, and 26 runs of
    Pacific salmon and steelhead are now listed under the Endangered
    Species Act.
        One important program aimed at restoring endangered and threatened
    runs of wild chinook, steelhead, coho, sockeye, and chum salmon is the
    Pacific Salmon Coastal Recovery Fund, funded through the National
    Marine Fisheries Service. For the past two years, this program has
    provided much-needed assistance to state, local, and tribal governments
    in Washington, Oregon, California, and Alaska for salmon recovery
    projects. This year we ask that the state of Idaho be made eligible to
    benefit from this program as well. In fiscal year 2002, we urge the
    Subcommittee to provide $200 million to provide the assistance the
    Pacific Northwest states need to restore threatened and endangered
    salmon and their habitat.
        Increased funding for this program is a key element of funding the
    new, multi-agency salmon recovery plan for the Columbia and Snake river
    basin. The salmon recovery plan embraces an ``aggressive non-breach''
    approach, setting forth a recovery plan that relies on non-dam
    breaching actions, including improving salmon spawning and rearing
    habitat, water quality and flows, better screening of irrigation
    diversions, hatchery and harvest management, and improvements to dam
    structures and operations. If this non-breach recovery package is not
    funded and implemented, or if the salmon recovery plan does not yield
    the expected biological benefit for Snake River salmon, the plan calls
    for the federal agencies to seek congressional authorization--as soon
    as 2003--to remove the four lower Snake River dams.
        In addition to helping to fund salmon recovery in the Columbia and
    Snake river basin, the Pacific Coastal Salmon Recovery Fund will
    provide equally needed assistance for salmon recovery efforts up and
    down the Pacific coast, including, but not limited to, Puget Sound,
    Oregon's Willamette River, and California's coast and Central Valley.
        By increasing funding for the Pacific Coastal Salmon Recovery Fund
    to $200 million for fiscal year 2002, you can help preserve this
    economically, culturally, and ecologically valuable resource and help
    the Northwest states and local communities to adopt and embrace the
    measures needed to restore Pacific salmon and steelhead. Restoring
    salmon also will allow the United States to meet treaty obligations
    with Northwest Indian tribes and Canada.
                  nmfs participation in hydropower relicensing
        The National Marine Fisheries Service (NMFS) plays an important
    role in hydropower relicensing when a hydropower project impacts
    species that migrate between fresh water and the ocean during their
    life cycles. Congress should appropriate adequate resources for NMFS to
    address fisheries management issues in the increasing number of
    hydropower dams seeking renewal of their operating licenses from the
    Federal Energy Regulatory Commission on the West Coast and in the
    Southeast. A $2 million increase in the Habitat Conservation Program:
    Operations, Research, and Facilities' ``Sustain Healthy Coasts
    Strategic Goal'' will help to ensure a more efficient licensing
    process, benefiting the hydropower industry and furthering efforts to
    protect and restore fisheries resources.
                                     ______

     Prepared Statement of the Association of America's Public Television
                                    Stations

        The Association of America's Public Television Stations submits
    this testimony to the Appropriations Subcommittee on Commerce, State,
    Justice and the Judiciary. APTS, on behalf of the nation's 354 local
    public television stations, urges the committee to support funding for
    the Public Telecommunications Facilities Program (PTFP) in the National
    Telecommunications Information Agency at the U.S. Department of
    Commerce.
        This year APTS is asking Congress to fund the PTFP in fiscal year
    2002 at $110 million. This increase in funding is essential to fund
    part of public television's equipment needs in the mandated conversion
    of digital broadcast. For over 30 years the federal government has
    helped public broadcasting build an infrastructure that reaches
    virtually every American television household. The Federal
    Communications Commission has mandated that public television stations
    must be on the air with a digital broadcast by May of 2003. Public
    television appreciates the increase in funding that the committee
    provided last year and the recognition it provided to the cost of
    converting. We respectfully ask the subcommittee to increase PTFP
    funding to help stations convert to digital transmission.
                         commitment in the digital age
        Public broadcasting has estimated the costs of its conversion to
    digital at $1.8 billion, and is seeking federal financial assistance in
    the amount of $699 million over five years. Public broadcasters
    historically have been the leaders in using new technologies for
    education and public service. The nation's public television stations
    stand ready to make an historic commitment to all Americans to provide
    near universal access to wireless, high-speed data for education.
    Specifically, public television stations will commit the equivalent of
    one multicast digital channel--a daily average of 4.5 megabits per
    second (Mbps), among the highest data rates available--for formal early
    childhood, K-12, and post-secondary education, as well as workforce
    training and professional development. This digital capacity would
    provide the equivalent of three T-1 lines to every school in America
    and is conservatively valued at $2.4 billion per year.
        The congressionally appointed bi-partisan Web-based Education
    Commission called for broadband access to be made widely and equitably
    available, and affordable for all learners. E-rate funding cannot meet
    this need. Applications for E-rate discounts total $5.8 billion, but
    only $2.25 is available. Public television stations can fill the gap.
               harnessing digital technology to serve the public
        With roots going back to the earliest days of radio and television,
    America's public broadcasters have played a unique role in a media
    industry that is otherwise built on consumer advertising and mass
    market entertainment. Since the 1960s, publicly funded noncommercial
    television has provided a clear alternative to commercial television,
    focusing on education and culture, public affairs and the performing
    arts.
        While the proliferation of television channels has been driven by
    market demands, public television's core mission has not and will not
    change in a digital world. We will build on our track record of
    providing the best programming and services to educate and enlighten
    audiences. We also will continue to be leaders in using new technology
    for the public interest. From satellite delivery of broadcast signals,
    to the development of stereo broadcasting; from closed captioning and
    descriptive video services, to video streaming and cutting edge
    interactive television trials, public broadcasters have been inventors,
    innovators and blenders of technologies to serve the public.
        Public television is committed to use digital technologies to
    transform the way we learn--by providing the American public with
    educational services anytime anywhere. That means how they want them,
    when they want them and where they want them--in homes, schools,
    childcare facilities, and workplaces across America.
       multicast digital services--unlocking public television's public
                                service mission
        Since receiving their digital channels, public television stations
    have been engaged in systemwide and station level planning. In 1997,
    public broadcasting put forward a comprehensive plan for its digital
    conversion to the Administration and Congress. We set four broad
    systemwide goals for the use of digital technology--goals that are
    founded on fully utilizing the multicasting capability of the digital
    technology to expand and enhance services.
      --To make the full complement of Ready to Learn services available to
            every child, parent and caregiver in America. The PBS Ready to
            Learn Service is currently meeting two national education
            goals: it teaches basic reading skills and it helps prepare
            more children for school success. Its 133 participating
            stations cover over 94 percent of the country. In the past
            three years, RTL public television stations have trained
            370,000 parents and 250,000 teachers and caregivers, affecting
            approximately 6 million children.
      --To expand the reach of public television's K-12 educational
            programs and services by making them universally available to
            all schools and home schoolers. Seventy percent of public
            television licensees provide K-12 programming in math, science,
            arts and humanities. These services are enhanced by:
      --PBS TeacherSource.--An online K-12 teacher resource with line
            lesson plans, teacher guides and activities, correlated to more
            than 90 national and state standards; and,
      --PBS Teacherline.--Online modules to enhance the learning and
            teaching of K-12 mathematics and other core subjects.
      --To increase the reach of post secondary telecourses so that they
            are universally available to all adult learners. Collectively,
            public television stations are the largest source of post
            secondary telecourses in the nation. PBS Adult Learning Service
            (ALS) supports station-college partnerships that offer distance
            learning credit-bearing telecourses, enrolling more than
            500,000 students in 1999-2000. GED on TV has enabled more than
            two million adults in five years to earn their high school
            equivalency from home. The estimated positive economic impact
            of these programs, workers that are more productive exceeds $12
            billion.
      --To expand our commitment to serving the un-served and under-served
            populations in our country, those who because of economic,
            geographic, physical, cultural or language barriers have been
            left behind by the commercial marketplace. Public Broadcasting
            has pioneered the development of open and closed captioning for
            the deaf and descriptive video services and reading services
            for the blind or visually impaired. Stations like WYBE,
            Philadelphia and WNVC, Fairfax provide programming in multiple
            languages serving a variety of different ethnic cultures.
        Local public television stations throughout the country have turned
    those systemwide goals into concrete and very bold and exciting service
    plans tailored to their local communities. APTS maintains an
    interactive digital transition clearinghouse of stations' plans for
    digital services. Our data shows that virtually every public television
    station in the country has developed digital service plans to meet
    these and other goals. The centerpiece of virtually every plan is the
    delivery of multicast services with a strong focus on education.
      --In exchange for federal financial support and favorable cable must
            carry regulations, the nation's public television stations
            stand ready to commit an average daily rate of 4.5 megabits per
            second (approximately one channel) of their digital spectrum to
            education. The value of this capacity is conservatively
            estimated at $2.4 billion per year
      --Three out of every four PTV stations plan to carry at least two
            formal education multicast services.
      --Approximately 85 percent of PTV stations plan to multicast a
            children's channel; 78 percent intend to broadcast university-
            level or post-secondary telecourses; and 66 percent plan to
            multicast an instructional programming channel for students in
            grades K-12.
      --Others plan to multicast channels that focus on local public
            affairs, teacher training, foreign language programming, and
            programming aimed at minority and under-served audiences.
       ptv digital service plans--creating local solutions for national
       priorities, realizing national educational goals on a local level
        While public television stations plan to deliver one or more formal
    educational multicast channels, the specific educational services are
    tailored to meet local community needs.
        Florida public television stations have promised the state
    legislature that they will collectively devote a multicasting stream to
    the Florida Knowledge Network in return for digital funding. This
    statewide educational network will serve as a teacher training
    resource, linking Florida's classrooms with direct access to the
    highest quality programming, electronic field trips, and distance
    learning.
           providing unserved and underserved with access to digital
        Today, public television stations, through their nationwide system
    of transmitters and translators, serve 99 percent of American
    households with an over-the-air analog signal. Public television
    stations that serve rural communities with a network of analog
    translators are ideally positioned to bring the benefits of broadband
    digital services to the most rural and remote areas of this country.
        KNME in Albuquerque is considering leasing part of its digital
    spectrum to the New Mexico Department of Education to facilitate the
    delivery of educational materials to the state's K-12 schools. The
    station will position itself as the state's virtual classroom,
    providing curricular support and teacher training opportunities for
    viewers separated by hundreds of miles.
        Public television stations also plan to use the multicast
    capability to serve populations under-served because of cultural,
    language or economic barriers.
        KBDI in Denver plans to launch a Latino Initiative Channel. This
    channel would feature programming for Denver's Spanish-speaking and
    bilingual community and will emphasize news, public affairs, and social
    and cultural events.
        The Kentucky Network intends to work with art and cultural
    organizations to produce more arts education programming for the
    state's children. KET plans to create a statewide task force on arts
    education and early childhood. Ultimately, the network hopes to produce
    a dance series and musical programming for elementary students.
        The federal government must play its historic leadership role in
    underwriting a portion of public broadcasting's digital transition. The
    government's failure to make this investment will have direct
    consequences. Millions of Americans may be deprived of the enormous
    educational promise of digital television. Many of the smaller and
    rural stations may be unable to make the transition at all without some
    federal support.
                                   conclusion
        For more than 30 years, Congress has invested wisely in public
    broadcasting. We now have a strong system of public television stations
    that reaches 99 percent of American households, giving viewers tools to
    improve and enrich their lives. The public service promise of new
    digital technology is enormous:
      --for children to provide a dedicated stream of nonviolent,
            educational and entertaining programs, commercial-free and
            free-of-charge;
      --for parents and schools to better educate children;
      --for colleges and universities to reach out beyond their campus
            walls;
      --for students of all ages to have access to lifelong learning;
      --for under-served audiences whose income, geography, culture or
            disability threatens to cut them off from the digital promise;
      --for citizens who feel alienated from their local, state or federal
            governments; and
      --for public service organizations seeking to build a sense of civic
            connection and commitment.
        Realizing this potential and remaining a viable service provider in
    the digital age is fully dependent on a federal investment to ensure
    access to all digital services. Public television stands ready with
    service plans, matching state and local grants, and community-based
    content partners to fully utilize this technology for public service.
                                     ______

     Prepared Statement of the Columbia River Inter-Tribal Fish Commission

        Mr. Chairman, on behalf of the Columbia River Inter-Tribal Fish
    Commission (CRITFC), thank you for the opportunity to present the
    Commission's views on the fiscal year 2002 budget for the National
    Marine Fisheries Service (NMFS). The tribes support funding the
    Columbia River (Mitchell Act) hatchery program at $36 million, in order
    to implement reforms called for in the ``Conservation of Columbia Basin
    Fish'' (Federal Caucus ``All H'' Paper). Of that amount, $9 million (or
    25 percent of the actual enacted amount) should be contracted to the
    tribes for new or expanded supplementation programs. Savings can be
    realized by ensuring that no funds are expended under the Mitchell Act
    program for the so-called ``conservation marking'' program, an unproven
    mass marking and selective fisheries program when applied to chinook
    and a proven failure as applied to steelhead stocks, without an
    agreement of the co-managers. For the Columbia River (Mitchell Act)
    screening program, the tribes support funding of $20.6 million for
    screens and passage programs as identified in the Federal Caucus Plan.
    The tribes support increasing the level of funding for the Pacific
    Coastal Salmon Recovery Program to $165 million to provide sufficient
    funding for salmon restoration activities within the Columbia River
    basin and the rest of the Pacific Coast. Of that amount, $10 million
    should be provided to the Columbia River tribes in the form of a direct
    grant, and $25 million each to the states of Alaska, California,
    Oregon, Idaho, and Washington, and $20 million for Implementation of
    the 1999 Pacific Salmon Treaty Agreement. Finally, the tribes support
    funding the base Pacific Salmon Treaty Program at $7,456,000.
        The tribes note that the NMFS receives tens of millions of dollars
    in funding directly from the Bonneville Power Administration (BPA) or
    from BPA under the Northwest Power Planning Council's (NWPPC) Fish and
    Wildlife Program. Before the ESA listings, such funding to NMFS was
    subject to coordination with the regional co-managers, the states and
    tribes. Now, NMFS identifies ``ESA'' funding needs and sidesteps the
    normal regional coordination process. While some of NMFS's initiatives
    would receive regional support, others would not as they serve to
    undermine cooperative and proactive tribal, state, or stakeholder
    programs geared to restoring salmon and reducing burdens on private
    landowners. The tribes encourage you review Congressional and BPA
    funding for NMFS's salmon recovery activities.
                               mission statement
        Formed by resolution of the Nez Perce, Umatilla, Warm Springs and
    Yakama Tribes, CRITFC provides coordination and technical assistance to
    the member tribes to ensure that outstanding treaty fishing rights
    issues are resolved in a way that guarantees the continuation and
    restoration of our tribal fisheries into perpetuity. Since 1979, CRITFC
    has contracted with the BIA under the Indian Self-Determination Act
    (Public Law 93-638) to provide this technical support. The tribes' and
    CRITFC's technical experts have identified where federal and state
    resource managers have fallen short in protecting and restoring the
    habitat and production of all salmon stocks. Our goal is to restore a
    sustainable resource for the benefit of all peoples in the Pacific
    Northwest. Wy-Kan-Ush-Mi Wa-Kish-Wit, the tribes' restoration plan,
    identifies hypotheses based upon adaptive management principles to
    address those threats, and provides specific recommendations and
    practices that must be adopted by natural resource managers. See
    www.critfc.org for a copy of the plan.
                           wy-kan-ush-mi wa-kish-wit
        Issues that are addressed in Wy-Kan-Ush-Mi Wa-Kish-Wit include
    policy direction and/or conservation actions that must be made or taken
    in these areas: Allocation of the conservation burden; Harvest;
    Hatchery reform; Hydropower system operation; and, Habitat restoration
    and protection.
        Our testimony focuses on the need for hatchery reform. The tribes
    have, for over two decades, identified state and federal hatchery
    practices at the ninety-eight production facilities within the Columbia
    River basin as a significant factor in the loss of naturally spawning
    salmon stocks. NMFS agrees, citing these practices for the loss of
    naturally spawning coho. The past operation of these hatcheries has
    contributed to the decline of naturally spawning stocks throughout the
    basin. Only about 7 percent of Columbia River (Mitchell Act) hatchery
    production is released above The Dalles Dam. Yet, that is where the
    most damage to salmon has been and continues to be caused by the dams.
        About 1 percent of Mitchell Act production is used to assist the
    rebuilding and restoration of naturally spawning salmon, the stocks
    which have been constraining both Indian and non-Indian fisheries on
    the West Coast. Prior to the transition from hatchery-based fisheries
    to weak-stock management, mixed-stock fisheries were regulated on the
    basis of hatchery abundance and had a devastating effect on naturally
    spawning runs of the Columbia Basin. The tribes believe that the salmon
    mitigation and enhancement programs authorized under the Mitchell Act
    have discriminated against treaty protected fisheries and have failed
    to mitigate the salmon resource damage caused by the dams.
        Used correctly though, hatcheries can and should play an extremely
    important role in salmon recovery. We have proposed a biologically
    credible integrated plan to modify hatchery management practices
    throughout the basin in order to supplement rather than supplant
    natural spawning salmon populations. Within the last ten years, the
    Commission has developed substantial scientific justification
    supporting the use of Mitchell Act facilities for natural run
    enhancement. A supplementation protocol was agreed upon by the fish and
    wildlife agencies and tribes of the Columbia Basin Fish and Wildlife
    Authority and was peer reviewed and published in the text, Genetic
    Conservation of Fishes. Using this approach, the Confederated Tribes of
    the Umatilla Indian Reservation successfully restored chinook and coho
    stocks to the Umatilla River Basin. Salmon had been eliminated from the
    basin for over a half-century by irrigation practices. The Commission
    believes these practices need to be implemented immediately as an
    alternative to current Mitchell Act hatchery practices. If the Mitchell
    Act facilities continue to be operated as they are now, continued
    funding of those facilities will do nothing to restore ESA-listed fish
    or natural stock protection. CRITFC staff is currently preparing
    Hatchery Reform Begins with a Review of Current Hatchery Practices for
    publication, a draft can be made available for your use and review.
        NMFS's interpretation of the Endangered Species Act further limits
    the ability of the federally funded hatcheries to comply with
    congressional mitigation mandates. Some of these hatcheries can make a
    substantial contribution to the recovery of populations protected under
    the Endangered Species Act. Unless the National Marine Fisheries
    Service interprets the ESA to permit the use of these hatchery-reared
    populations for artificial propagation purposes as required under
    Section 3(15) of the Act, these facilities will not be used in an
    effective manner to hasten salmon recovery. CRITFC staff is evaluating
    the ESU and its applicability to salmon management, a paper titled The
    ``Evolutionarily Significant Unit (ESU)'' definition of a Distinct
    Population Segment: Evaluation of Scientific Evidence and Continuing
    Research. A draft of this paper can be available for your use and
    review, with the completed paper available in June.
        Columbia River (Mitchell Act) hatchery program.--Restoring Pacific
    salmon and providing for sustainable fisheries requires using the
    Columbia River (Mitchell Act) hatchery program to supplement naturally
    spawning stocks and populations. To accomplish this goal, provide $36
    million for the tribes and states, as co-managers, to jointly reform
    the Mitchell Act hatchery program using only jointly agreed upon
    marking programs. Of this amount, $9 million, or 25 percent of enacted
    funding, will be contracted to the tribes for new or expanded
    supplementation projects. In addition, to carry out necessary
    activities identified in the Federal Caucus All-H Paper, $20.6 million
    is for screens and fish passage programs. We ask that you direct NMFS,
    in coordination with tribal and state fishery mangers, allow the use of
    supplementation in restoring declining salmon populations and fisheries
    under recovery programs developed under the ESA. Of the hatchery
    facilities funded under this program, the management and funding for
    the following Mitchell Act hatchery should be transferred from the
    state or federal agency identified, via NOAA/NMFS, to the tribe
    specified: Klickitat Hatchery facility from Washington Department of
    Fish and Wildlife (WDFW) to the Yakama Nation.
        Of the other hatchery facilities funded under this program, the
    management and funding for the following hatcheries should be studied
    for transfer by NOAA/NMFS within 3 to 5 years from the state or federal
    agency identified to the tribe specified: Bonneville Hatchery from
    Oregon Department of Fish and Wildlife (ODFW) to the Yakama Nation);
    Carson Hatchery (from USFWS to the Yakama Nation); Little White Springs
    Complex (from USFWS to the Yakama Nation); Spring Creek Hatchery (from
    USFWS to the Yakama Nation); Cascade Hatchery (from ODFW to the
    Umatilla Tribe); Oxbow Hatchery Complex (from ODFW to the Umatilla
    Tribe); and Ringold Hatchery (from WDFW to the Umatilla Tribe).
        Pacific Coastal Salmon Recovery Program/Watershed Restoration.--
    Beginning in 1996, with the Sitka Salmon Summit hosted by Governor
    Knowles of Alaska, additional funding has been sought by the State of
    Alaska, the Pacific Northwest states, and the treaty tribes to serve
    critical unmet needs for the conservation and restoration of salmon
    stocks shared in these tribal, state, and international fisheries (See
    Record of Discussion, May 20,1996). The funds provided by Congress
    under the Program mark an important beginning in accomplishing the
    goals of this shared effort. For fiscal year 2002, provide the Columbia
    River treaty tribes with funding of $10 million through the Pacific
    Coastal Salmon Recovery Program. These program funds will continue to
    ensure that tribally sponsored watershed projects are based on the best
    science, are competently implemented and adequately monitored, and
    address the limiting factors affecting salmon restoration. This will
    include the use of monitoring protocols to systematically track current
    and future projects basin-wide. Projects undertaken by the tribes last
    year are consistent with the Wy-Kan-Ush-Mi Wa-Kish-Wit and the
    following programmatic areas identified by Congress and are outlined in
    the report provided with this testimony. The tribes support expanding
    this program to include the State of Idaho.
                         pacific salmon treaty program
        The tribes support the U.S. Section recommendation at the funding
    level of 7,456,000, with $5,612,000 for the Pacific Salmon Treaty base
    program, with Alaska, Oregon, Idaho, Washington, and the NMFS to share
    those funds as described in the U.S. Section of the Pacific Salmon
    Commission's Budget Justification. We continue to support additional
    funding to for additional chinook research and management activities at
    $1,884,000; these funds are annually allocated to new state, tribal and
    federal projects through a technical review process.
        In summary, Mr. Chairman, the Commission is an excellent working
    model of leaders from four tribes working together to protect their
    treaty fishing rights. This Commission has demonstrated that, with a
    staff of scientists, biologists, hydrologists, law enforcement
    personnel, and other experts advising tribal policy-makers, tribes can
    take the lead on natural resource issues, provided that adequate
    resources are available. This is a time when increased effort and
    participation are demanded of the Commission and the tribes, we ask for
    your continued support of our efforts, and we will be pleased to
    provide any additional information that this committee may require.
                                     ______

           Prepared Statement of the Marine Fish Conservation Network

        The Marine Fish Conservation Network is pleased to share its views
    regarding National Marine Fisheries Service (NMFS) programs in the
    National Oceanic and Atmospheric Administration's (NOAA) budget
    request. We ask that this statement be included in the hearing record
    for the fiscal year 2002 Commerce, Justice, State and the Judiciary
    Appropriations Bill.
        The Marine Fish Conservation Network is a national coalition of
    more than 100 environmental, commercial and recreational fishing
    associations, and marine science groups dedicated to conserving marine
    fish and promoting their long-term sustainability. We greatly
    appreciate the funding this Subcommittee has provided for the marine
    fish conservation programs within NMFS over the last several years and
    we look forward to working with the Subcommittee to enact responsible
    levels of funding in the coming fiscal year.
        There are four areas in the NMFS budget where we believe the
    requested spending levels need to be increased to help the agency
    fulfill its obligations as the federal government's fisheries
    management agency.
                            annual stock assessments
        Request.--Increase $26.6 million from 2001 funding levels
        The status of more than three quarters of all species managed under
    the Magnuson-Stevens Fishery Conservation and Management Act is unknown
    largely due to a lack of funding for basic research and stock
    assessments. Fishery managers need better information on all stocks to
    fulfill their responsibilities to rebuild overfished stocks, prevent
    overfishing of stocks approaching an overfished condition, and to set
    appropriate catch levels for those fish that are not overfished. The
    National Marine Fisheries Service, with the President's requested
    increase of $13.3 million for stock assessments, would still have a
    deficit of 1,700 research days at sea to fulfill their stock assessment
    duties. Increasing the stock assessment line item by $26.6 million from
    2001 levels would cut that number in half so that the deficit could be
    erased in 2003 or 2004.
                               observer programs
        Request.--Increase $16.4 million above fiscal year 2001 funding
    levels
        By increasing the annual appropriations for fisheries observers by
    $16.4 million to $25 million, the National Marine Fisheries Service
    would be able to establish and implement an effective National Observer
    Program. This increase includes an extra $5 million over fiscal year
    2001 funding levels for West Coast observers. The information from
    these observers, together with the information that is expected to be
    generated through the National Fisheries Information System, would give
    us a better idea on exactly how much fish is caught directly and as
    bycatch, thereby improving management of our fish populations.
                          essential fish habitat (efh)
        Request.--An increase of $12.5 million over fiscal year 2001
    funding levels
        Essential fish habitats (EFH) are those waters and substrate on
    which fish depend. These habitats are currently being damaged from both
    land-based activities and destructive fishing practices. While the
    Sustainable Fisheries Act of 1996 gave NMFS a clear mandate to identify
    and conserve essential fish habitat too little has been done to protect
    these habitats. This increase in funding would allow NMFS to gain the
    information necessary to further refine designations of EFH and take
    action to conserve EFH, including measures to minimize the adverse
    impacts of fishing gear on EFH.
                          enforcement and surveillance
        Request.--An increase of $10.3 million over fiscal year 2001
    funding levels for enforcement An increase of $11.1 million over fiscal
    year 2001 funding levels for the Vessel Monitoring System (VMS) Program
        Enforcement of our fishery management laws has been woefully
    underfunded for years. According to NMFS, there are currently around
    150 enforcement agents that are each responsible for 1200 miles of
    coastline. We request increasing funding for enforcement by $7 million
    over the President's request to allow for the hiring of 30 more
    officers to begin to address this chronic shortfall. The increase would
    also allow for a strengthening of alternative enforcement programs and
    enhancement of state and local partnerships.
        Increasing funding for VMS by $11.1 million over fiscal year 2001
    levels would allow for the establishment and implementation of VMS
    systems and the placing of VMS transponders on a vast majority of the
    estimated 10,000 boats in the U.S. commercial fishing fleet. VMS
    programs enhance data collection and safety at sea, and can be
    beneficial to fisherman by allowing them to fish right up until a quota
    is reached rather than leave the fishing site before the season closes.
    VMS is beneficial to regulators because it will allow officials to know
    when a fishing vessel is violating closed areas, or is fishing beyond
    the end of a regulated fishing period.
        Thank you for consideration of our requested increases for these
    important fish management programs.
                                     ______

     Prepared Statement of the American Indian Higher Education Consortium

        Mr. Chairman and Members of the Subcommittee, on behalf of this
    nation's 32 American Indian Tribal Colleges and Universities, which
    comprise the American Indian Higher Education Consortium (AIHEC), we
    thank you for the opportunity to share our fiscal year 2002 (fiscal
    year 2002) funding requests regarding the United States Department of
    Commerce and the Small Business Administration.
        This statement will cover two areas: (a) background information on
    Tribal Colleges and Universities, and (b) funding requests and
    justifications. The following is a summary of our fiscal year 2002
    requests.
                              summary of requests
        Under the Department of Commerce programs, we will address three
    specific areas:
      --We urge the Subcommittee to support the continuation of the $15
            million National Oceanic and Atmospheric Administration (NOAA)
            program: Educational Partnership Program with Minority Serving
            Institutions, included in the President's fiscal year 2002
            budget request. This program will increase the number of
            minorities trained in the natural and physical sciences and
            establish Collaborative Science Centers at several Minority
            Serving Institutions. We request report language eliminating
            the requirement that the MSI, even if applying in partnership
            with graduate degree awarding mainstream institutions, must
            have an accredited graduate program in oceanic, earth and
            atmospheric sciences. This requirement eliminates all of the
            tribal colleges and most other MSIs from participating in what
            is designed to be an MSI focused program.
      --We urge the Subcommittee to support the Economic Development
            Administration's efforts to address chronic unemployment and
            poverty in reservation communities and to include report
            language that would foster partnerships between the EDA and
            tribal colleges.
      --We request support and expansion of the Internal Trade
            Administration (ITA) initiative to help Native Americans enter
            new markets and increase cultural heritage tourism as part of
            their communities' economic development plans. Tribal colleges
            often serve as the tribal archive and community centers and are
            a logical catalyst for attaining the economic development goals
            of both the ITA and tribal communities.
        Under the Small Business Administration, we urge the Subcommittee
    to support the existing Tribal Business Information Centers (TBICs) and
    the creation of a new Native American Business Development Center
    program within SBA. We request $5 million to fund these two programs.
                         background on tribal colleges
        The Tribal College Movement was launched in 1968 with the
    establishment of Navajo Community College, now Dine College, in Tsaile,
    Arizona. A succession of tribal colleges soon followed, primarily in
    the Northern Plains region. In 1972, the first six tribally controlled
    colleges established the American Indian Higher Education Consortium
    (AIHEC) to provide a support network for member institutions. Today,
    AIHEC represents 32 Tribal Colleges and Universities located in 12
    states, begun specifically to serve the higher education needs of
    American Indian students. Collectively, they serve 25,000 students from
    over 250 federally recognized tribes.
        Tribal colleges offer primarily 2-year degrees, although in recent
    years some institutions have begun to offer baccalaureate and graduate-
    level degrees. The vast majority of the tribal colleges are fully
    accredited by independent, regional accreditation agencies.\1\ In
    addition to college-level programming, tribal colleges provide high
    school completion, adult education, job training, and college
    preparatory courses. Although the central focus is on education, tribal
    colleges fulfill other roles for their respective communities. Tribal
    colleges function as community centers, libraries, tribal archives,
    career centers, economic development centers, public-meeting places,
    and child care centers. An underlying goal of the tribal colleges is to
    improve the lives of students through higher education and to move
    American Indians toward self-sufficiency.
    ---------------------------------------------------------------------------
        \1\ The Tribal Colleges and Universities are accredited by regional
    accreditation agencies and must undergo stringent performance review on
    a periodic basis. The higher education division of the respective
    regional accreditation agency accredits twenty-seven of the TCUs. Two
    new TCUs are at the Pre-candidate stage as they complete work to attain
    Candidate status; one TCU is at Candidate status. Two TCUs are
    accredited as ``Vocational/Adult Schools by the ``schools'' division of
    the respective regional accreditation agency.
    ---------------------------------------------------------------------------
        Tribal colleges provide needed access to higher education for
    American Indians living in mostly rural, economically depressed areas
    of the country. The colleges are chartered by their respective tribal
    governments and were established in response to the recognition by
    tribal leaders that local, culturally based education institutions are
    best suited to help American Indians succeed in higher education.
    Tribal colleges combine traditional teachings with conventional
    postsecondary courses and curricula. The colleges have devised
    innovative means to address the needs of tribal populations in
    economically depressed regions and are successful in overcoming long-
    standing barriers to Indian higher education. They are unparalleled in
    providing the knowledge and skills students need for successful
    transfer to 4-year institutions and to gain meaningful employment.
    Since the first tribal college was established on the Navajo
    reservation, these vital institutions have come to represent the most
    significant development in the history of American Indian higher
    education, providing access to under-represented students and promoting
    achievement among students who may otherwise never have known post-
    secondary education success.
        Funding for tribal colleges is grossly inadequate. While these
    institutions have faced and successfully negotiated many challenges in
    the history of the Tribal College Movement, adequate funding remains
    the most significant barrier to their ongoing success. Core operational
    funding for 25 tribal colleges is provided through the Tribally-
    Controlled College or University Assistance Act (TCCUAA), Public Law
    95-471. Funding provided under the Act is less than two-thirds of its
    authorized level of $6,000 per full-time Indian student. In fiscal year
    2001, the Colleges received $3,849 per full-time Indian student.
    Moreover, this amount is less than two-thirds of the estimated $6,089
    per full-time student received by mainstream community colleges. While
    mainstream institutions have a foundation of stable state support,
    tribal colleges must rely on the Federal government for operational
    funding. Because tribal colleges are located on federal trust
    territories, states have no obligation to fund them. In fact, most
    states do not even fund our colleges for the non-Indian state-resident
    students who account for approximately 20 percent of our enrollments.
        Since their inception, tribal colleges have achieved exceptional
    growth and success, yet they are the most poorly funded higher
    education institutions in America. Although conditions at some have
    improved substantially, many tribal colleges still operate in trailers,
    cast-off buildings, and facilities with crumbling foundations, faulty
    wiring, and leaking roofs. Sustaining quality instructional programs
    has been a challenge without a reliable source of funds for facilities
    maintenance and construction.
        Today, one in five American Indians live on reservations. As a
    result of 200 years of Federal Indian policy--including policies of
    termination, assimilation and relocation--many reservation residents
    live in abject poverty comparable to poverty found in Third World
    nations. Through the efforts of tribal colleges, American Indian
    communities receive the services they need to reestablish themselves as
    responsible, productive, and self-reliant citizens. It would be tragic
    not to expand the modest investment in, and capitalize on, the human
    resources that will help open new avenues of economic development
    specifically through enhancing access and use of information
    technologies.
                                 justifications
        Given the needs outlined above and the reality of the speed with
    which technology is advancing, we strongly urge the Subcommittee to
    support the following programs within the Department of Commerce and
    the Small Business Administration.
    Department of Commerce Programs:
        National Oceanic and Atmospheric Administration (NOAA).--Building
    Math, Science and Technology capacity at tribal colleges and other
    Minority Serving Institutions: In fiscal year 2001, the National
    Oceanic and Atmospheric Administration launched a $15 million program
    designed to increase interest among minority students in fields of
    science central to the mission of NOAA. Part of this program included
    the creation of three or four Cooperative Science Centers at MSIs. In
    April 2000, the National Indian Center for Marine and Environmental
    Research and Education (NICMERE) was created through a cooperative
    agreement among Northwest Indian College (NWIC) in Bellingham, WA,
    NOAA, and the Department of Commerce with NOAA's National Marine
    Fisheries Service, as the lead agency. The NWIC project is the first in
    the country aimed at increasing Tribal representation in the ranks of
    marine and environment science, and technical professionals. Distance
    learning will play a major role in NICMERE's outreach to other tribal
    colleges and Indian reservations. The main goal of this collaborative
    effort is to increase the number of Native students acquiring
    baccalaureate degrees in marine and environmental science fields and
    entering graduate degree programs in preparation for scientific careers
    with the Federal agencies such as NOAA and NMFS or in their respective
    tribal government. The NOAA-MSI Initiative could potentially lead to
    the establishment of graduate level programs on a cooperative basis
    utilizing scientific personnel from NWIC, Northwest Fisheries Science
    Center, and faculty from interested universities in the Northwest. We
    urge the Subcommittee to maintain the $15 million for NOAA-EPPMSI
    Initiative, included in the President's fiscal year 2002 budget, and to
    include report language eliminating the current requirement that an MSI
    must have an accredited graduate program in oceanic, earth, and
    atmospheric sciences even if applying in partnership with graduate
    degree awarding mainstream institutions. This requirement eliminates
    all of the tribal colleges and most other MSIs from participating in
    what is designed to be an MSI program.
        Economic Development Administration (EDA).--The EDA is charged with
    providing assistance to economically distressed areas and regions to
    alleviate conditions of ongoing unemployment and underemployment.
    Contributing to the economic development of American Indian
    reservations is an essential goal of Tribal Colleges and Universities.
    We support the commitment of the EDA to strengthen its efforts to
    assist American Indian tribes by providing capacity building and
    developing finance and infrastructure projects needed to enable our
    communities to be more effective and competitive in their economic
    development efforts. We request report language that will foster EDA
    partnerships with tribal colleges to enable our institutions to further
    address the chronic unemployment and poverty that plague reservation
    communities.
        International Trade Administration (ITA).--The tribal colleges are
    currently pursuing partnerships with USDA, US-AID, Interior, and the
    private sector to bolster international programs, tourism, trade, and
    outreach to other indigenous peoples worldwide. For example, Haskell
    Indian Nations University in Lawrence, Kansas, recently received a
    partnership grant from US-AID to work in the Altai (Siberia) region of
    Russia. The Native American economic development program of ITA could
    partner with the tribal colleges to enhance their on-going and future
    efforts, to use cultural heritage tourism as part of the economic and
    community development programs at the tribal colleges. We request
    report language to encourage ITA to specifically include the tribal
    colleges as partners in the Native American economic development
    program.
    Small Business Administration (SBA)
        Tribal Business Information Center (TBICs).--To address the unique
    conditions encountered by reservation-based American Indians in their
    efforts to create, develop and expand small businesses, SBA has funded
    the TBICs project. This program is designed to provide culturally
    tailored business development assistance to potential and current small
    business owners. TBICs are a partnership arrangement between a tribe or
    tribal college and the SBA that offers access to a wide variety of
    resources and practical guidance at accessible reservation locations.
    We support the creation of a Native American Business Development that
    would offer one-stop assistance to tribal small businesses by providing
    a wide variety of information and guidance, employing current and
    future TBICs as branch offices. We urge Congress appropriate $5 million
    to support a Native American Business Development Center and the
    reservation-based business information centers that are so important to
    local economic development.
                                   conclusion
        In light of the justifications presented in this statement, we urge
    the Subcommittee to increase funding and eliminate barriers for tribal
    colleges to help bring economic self-sufficiency to Indian Country.
    Fulfillment of AIHEC's fiscal year 2002 requests will strengthen the
    mission of our colleges and the enormous, positive impact they have on
    our communities and will help ensure that we are able to properly
    educate and prepare thousands of American Indians for the workforce of
    the 21st Century. Without tribal colleges as a catalyst to move
    individuals from welfare to work, much of the reform accomplished by
    Congress will fail throughout Indian Country.
        Tribal colleges are working hard to make every dollar count. They
    have been extremely responsible with the federal support they have
    received over the last 20 years. Our institutions have proven
    themselves as a sound federal investment. Thank you again for this
    opportunity to present our requests before this Subcommittee. We
    respectfully request your continued support and full consideration of
    our fiscal year 2002 appropriations requests.
                                     ______

                   Prepared Statement of Columbia University

        Mr. Chairman, thank you for this opportunity to submit testimony
    for the Subcommittee's consideration concerning the fiscal year 2002
    Appropriations Bill for the Office of Global Programs within NOAA/
    Department of Commerce.
        Columbia University's Earth Institute houses the International
    Research Institute for Climate Prediction, (IRI), located at the
    Lamont-Doherty Campus of Columbia University. The IRI was selected
    through an intense, competitive process in 1994 by NOAA (1) to produce
    long range, seasonal to interannual forecasts based on major climate
    events such as El Nino, and (2) to develop experimental climate models
    for improvement of climate forecasting and predictions on a global and
    regional scale. NOAA recently extended the original 5-year agreement to
    include additional long-range goals and research targets.
        The requests in this statement represent the generic need for the
    maintenance of ongoing programs and additional resources for NOAA and
    its extramural research collaborators to advance the science and
    accuracy of climate and weather forecasting.
                                    summary
        The components of this statement are:
      --Maximum support for the Office of Global Programs, funded at a
            minimum at the fiscal year 2001 level of $68.095 million;
      --Funding of $20 million for a Supercomputer to be shared by
            universities/institutions for high end climate modeling and
            research;
      --Funding of $20 million for a Supercomputer for NOAA to be used as a
            backup for National Weather Service and other NOAA forecasting
            purposes, including research.
    Maximum support for OGP Budget
        This Committee has supported full funding of the budget request of
    the OGP through the past several appropriations acts. Built in to the
    OGP budget request are the ongoing research initiatives of several
    multiyear efforts, such as the IRI. To maintain continuity and the
    essential research core of NOAA's multi-tiered agenda, assurance of
    continuity and a stable base of funding are paramount. All of NOAA's
    intramural and extramural research initiatives have been determined and
    planned by nonpartisan, scientific experts whose goals have been to
    improve the science, accuracy and lead-time of long range climate
    forecasts, and to improve regional warning systems through down-scale
    modeling from IRI global forecasts. The importance of maintaining and
    sustaining this comprehensive, integrated and balanced approach to
    understanding our climate system will permit improved and longer lead
    time forecasting. This in turn will allow better planning for the
    effects of climate forced events, resulting in saved lives, minimized
    property losses, and improved planning in resource allocation and crop
    planting.
        This request is for maximum funding for NOAA's OGP activities. At a
    minimum, the level for consideration should begin with the fiscal year
    2001 level of $68.095 million.
    High end Supercomputing
        Current climate modeling in the United States is limited by
    computer capacity. The House Science Committee held a hearing recently
    on Climate Forecasting: The State of the Science. When queried by
    Committee Members, the independent scientific experts who appeared as
    witnesses stated unanimously that the greatest need for U.S.
    advancement in the climate modeling and research fields is the need for
    Supercomputing capacity among universities and institutions for high-
    end use.
        The Japanese and European advances in climate modeling and
    forecasting have been enabled through the availability of government
    funded and provided Supercomputers. U.S. climatologists have now
    reached the capacity of currently utilized computer systems in the
    high-end tasks associated with water and atmospheric modeling. The
    ability to process massive amounts of data can be only achieved through
    the acquisition of vector analysis Supercomputers.
        Vector analysis computers were not available to U.S. Government-
    funded institutions until recently, when Cray gained the U.S. marketing
    rights for NEC vector analysis Supercomputers. The current U.S.
    approach, using MPP technology, cannot process the whole of computer
    modeling tasks associated with water and atmospheric data on a global
    scale. The inherent limitations of the MPP computer architecture cannot
    embrace the data as one complex set of variables and adequately process
    the multiple paths and variables associated with global modeling.
        Generically, scientists acknowledge that the facility must be
    located apart and distinctly separate from NOAA's ongoing computer
    functions, due to the need for a dedicated Supercomputer specifically
    configured for high-end climate and modeling and research. A shared
    computer with NOAA for NOAA's use, whether part-time or back up, does
    not provide the capability and sustained processing power needed for
    the demands associated with high-end climate modeling. This request for
    $20 million in fiscal year 2002 is for a computer to be competitively
    bid and awarded, and for institutions, like the IRI, to have access for
    sharing the use of Supercomputing capacity.
    National Weather Service Supercomputer
        There is widespread recognition among the extramural research
    community for the necessity of improved capacity and backup among
    computers for the National Weather Service. There is also a recognized
    and documented need in NOAA for a backup computer for the NWS. Last
    year's shutdown of NOAA's main computer, and subsequent loss of
    forecasting ability, left the NWS unable to provide the services upon
    which U.S. citizens, state and local governments, and private industry
    have come to rely. The necessity of a backup is clear, and in times of
    non-use as a backup, NOAA's internal research demands for this capacity
    exist. This statement concerning NOAA's needs represents consensus
    among the extramural community for additional resources and
    Supercomputer capacity for NOAA and the NWS.
        Thank you for this opportunity to present and articulate the needs
    and request for climate modeling and research in the United States.
                                     ______

    Prepared Statement of the National Federation of Community Broadcasters

        Thank you for the opportunity to submit testimony to this
    Subcommittee regarding the appropriation for the Public
    Telecommunications Facilities Program (PTFP). As the President and CEO
    of the National Federation of Community Broadcasters I speak on behalf
    of 150 community radio stations across the country. NFCB is the sole
    national organization representing this group of stations which provide
    service in the smallest communities of this country as well as the
    largest metropolitan areas. Nearly half of our members are rural
    stations and half are minority controlled stations.
        In summary, the points we wish to make to this Subcommittee are
    that NFCB:
      --Supports funding for PTFP that will cover the on-going needs of
            public radio and television stations.
      --Supports funding for conversion of public radio and television to
            digital broadcasting.
      --Requests report language to ensure that PTFP utilizes any digital
            funds it receives for radio as well as television needs.
        Community radio supports $110 million in funding for the Public
    Telecommunications Facilities Program in fiscal year 2002.--Federal
    support distributed through the PTFP is essential to continuing and
    expanding the public broadcasting service throughout the United States.
    It is particularly critical for rural stations and for those stations
    serving minority communities. PTFP funds new stations, expanding the
    reach of public broadcasting to rural areas and to audiences that are
    not presently served by existing stations. In addition, it replaces
    obsolete and worn out equipment so that the current stations can
    continue to broadcast high quality programming. Finally, with the
    advent of digital broadcasting, PTFP funding will help with the
    conversion to this new technology.
        We support $110 million in funding to ensure that both the on-going
    program, currently funded in fiscal year 2001 at $43.5 million, will be
    continued and the increase to $110 million will be available to help
    cover the cost of radio and television converting to digital
    transmission.
        Federal funding is particularly critical to stations serving rural
    and underserved audiences which have limited potential for fundraising
    because of sparse populations, limited number of local businesses, and
    low income levels. Even so, PTFP funding is a matching program so that
    the federal money is leveraged with a local commitment of funds. This
    program is a strong motivating factor in raising the significant money
    necessary to replace, upgrade and purchase expensive broadcast
    equipment.
        Community radio supports funding for conversion to digital
    broadcasting for public radio and television.--While public
    television's digital conversion needs are more immediate, the Federal
    Communications Commission is now in the process of identifying a
    standard for digital radio transmission. We expect that there will be
    funds available for radio conversion as well as television conversion.
    More immediately, the television conversion process is already having
    an impact on public radio stations. As television stations increase the
    space they need on their towers to accommodate both analog and digital
    signals, radio stations that rent space on TV towers are losing their
    leases and being forced to move to other towers--sometimes with very
    short notice. This situation will only get worse over the next year as
    we approach the FCC deadline for television conversion. We would like
    enough money in the PTFP to help public radio stations who lose their
    tower space do the necessary engineering studies and move to new tower
    locations.
        We appreciate Congress' direction to the Corporation for Public
    Broadcasting that it utilize its digital conversion fund for both radio
    and television and ask that you ensure that the PTFP funds are used for
    both media. Congress stated, with regard to the fiscal year 2001
    digital conversion funds:

        The required (digital) conversion will impose enormous costs on
    both individual stations and the public broadcasting system as a whole.
    Because television and radio infrastructures are closely linked, the
    conversion of television to digital will create immediate costs not
    only for television, but also for public radio stations (emphasis
    added). Therefore, the Committee has included $15,000,000 to assist
    radio stations and television stations in the conversion to
    digitization . . (S. Rpt. 105-300)

        NFCB requests that the funding for digital conversion be committed
    in advance to facilitate the orderly transition of a very
    individualized process--a process that will be different at each
    station. Advanced funding will give the system time to raise the
    substantial matching funds that will be necessary and to know what
    additional funds will be needed to complete the process.
        Finally, we are also concerned that independent producers'
    conversion needs be addressed in some way so that this important source
    of programming is not locked out of the public broadcasting system.
        Thank you for your consideration of our testimony.
                                     ______

                  Prepared Statement of National Public Radio

                                  introduction
        Thank you for the opportunity to submit a statement for the hearing
    record on behalf of National Public Radio (NPR) and the hundreds of
    public radio stations that air NPR programming across the country.
    Public radio looks forward to working with Chairman Judd Gregg and his
    staff as well as the other distinguished Subcommittee members and
    staff.
        Public broadcasting seeks a $110 million appropriation for the
    Public Telecommunications Facilities Program (PTFP) to be included in
    the fiscal year 2002 Commerce-Justice-State bill. This funding will
    help public radio and television stations accomplish the following:
        Maintain and Expand Service
        Digital Broadcasting Conversion.--The estimated cost for digital
    radio transmission conversion is $116 million.
        The National Telecommunications and Information Administration
    (NTIA), part of the U.S. Department of Commerce, manages PTFP. PTFP is
    a matching grants program primarily for public radio and television
    stations' capital projects as well as for other non-profit
    telecommunications entities' capital projects. It helps stations
    purchase equipment to extend their signals to unserved areas, replace
    outdated hardware such as transmitter antennas and upgrade equipment
    and convert to digital technologies. It is the only capital grants
    program available to public broadcasters.
                          maintain and expand service
    Public-Private Partnership
        The PTFP program is a successful public--private partnership
    because each grant requires a local match--typically 50 percent--
    leveraged from a station's community. These facilities are usually
    established as a result of the community's desire to receive first or
    additional public radio service, and are funded through state grants or
    through capital campaigns funded by the listeners. For fiscal year
    2000, NTIA awarded $4.5 million to 56 public radio projects. The awards
    ranged from $4,054 to $414,334. Local stations matched these grants by
    raising over $3 million in funds from communities that recognize the
    enormous contribution made by public radio.
        This partnership helps stations that have relatively small budgets
    afford expensive capital items such as a transmission system which can
    cost a Class A station $264,000 and a Class C station $900, according
    to NTIA estimates. These figures do not include production equipment.
    In 1999, the average total revenue for public radio stations was $1.3
    million. Thus, without the federal matching grant, most public radio
    stations could not afford a piece of equipment that is a quarter or
    more of their operating budgets.
        It is noteworthy that public radio stations are often constrained
    in their ability to finance major capital expenditures. Stations are
    unable to pass along costs to listeners and most stations cannot take
    out loans for capital projects. This is particularly true in rural and
    urban areas where small businesses typically experience greater
    difficulty obtaining financing. PTFP assists stations with the high
    cost of these capital projects through matching grants.
    Maintaining Service
        PTFP has helped build and maintain the infrastructure necessary to
    deliver quality programming to millions of listeners and viewers
    nationwide. For instance, PTFP is awarding WEPR-FM in Greenville, SC
    $34,100 to replace its aging 27-year-old transmitter.
        In addition, West Virginia Public Radio is receiving a $168,530
    grant to expand its coverage and provide first public radio service to
    about 50,000 residents of central West Virginia. The project will
    replace a 23-year-old transmitter and construct a new tower at WVPN-FM
    in Charleston. In addition, the West Virginia Public Radio Network will
    replace a 31-year-old transmitter, the antenna and the line at WVPW-FM
    in Buckhannon.
    Expanding Service
        For more than 35 years, PTFP has played a major role in the
    development of America's public broadcasting stations. With the
    program's assistance, public radio reaches approximately 90 percent of
    the U.S. population. In fact, grants for bringing first service to a
    region are given the highest priority.
        In fiscal year 2000, a total of 19 grant awards will provide new
    public radio services to 434,000 people. The 19 communities benefiting
    from these awards are located in 15 states. One of the projects
    includes expanding the facilities of KENW-FM in Portales, NM by
    constructing new translators at Fort Sumner and Conchas Lake. The new
    translators will add first public radio service to about 2,500 people.
    Another project receiving a fiscal year 2000 grant includes the
    construction of public radio facilities to serve the Blackfeet Indian
    Reservation in Browing, MT.
        In addition, New Hampshire Public Radio was awarded $49,500 to
    expand its service area by constructing a repeater station in Jackson.
    The station will provide public radio programming to about 135,000
    residents of Grafton, Carroll and Coos counties and first service to
    over 5,000 Mount Washington Valley residents.
        One of the hallmarks of the program is its dedication to rural
    service. PTFP is especially valuable for public radio stations in rural
    states like Alaska, Kentucky, Vermont and Hawaii where topography or
    sheer size makes it difficult for all residents to receive a public
    radio signal. For example, PTFP is awarding a grant to KTNA-FM in
    Talkeetna, AK to improve its studio production, on-air, and satellite
    interconnection capabilities. Talkeetna is located approximately 120
    miles north of Anchorage and it provides the sole public radio service
    to the 5,300 residents of the northern half of the Matanuska-Susitna
    Borough, an extremely rural area that encompasses 12,250 square miles.
                        digital broadcasting conversion
        Like our friends in public television, NPR and its member stations
    are excited about the possibilities of digital service and ``new
    media''. PTFP will greatly enhance the ability of local stations to
    attract state and private funding necessary to convert radio and
    television stations to a digital standard. The estimated cost for
    digital radio is $116 million for transmission only, excluding
    production equipment.
        Digital radio transmission technology is poised to deliver near
    compact-disc-quality sound free of interference to listeners. Digital
    production and transmission conversion will enable public radio
    stations to produce and deliver programming using a far more efficient
    process than currently exists. It may allow listeners and users to
    experience a variety of new services such as the ability to search
    program formats, scan selective programs as well as read music lyrics
    and song titles.
        U.S. broadcasters are developing a digital technology that works in
    the existing AM and FM radio bands named In-Band, On-Channel or
    ``IBOC.'' The Federal Communications Commission (FCC) initiated a
    digital audio broadcasting, or ``DAB,'' rulemaking in November 1999,
    placing a high priority on preserving spectrum. IBOC DAB achieves
    spectrum preservation by combining digital and analog signals within
    the same AM or FM radio channel, thereby avoiding the need for
    additional spectrum.
        IBOC DAB will be independently tested by the National Radio Systems
    Committee (NRSC) in the summer 2001. At some point after evaluation of
    the additional testing, the NRSC is expected to make a recommendation
    to the FCC on the selection of a standard. The FCC is awaiting this
    industry recommendation before it endorses a digital radio transmission
    standard.
                                   conclusion
        It is fitting that PTFP resides with the agency charged with
    spectrum management and thus has the technical expertise to make
    informed engineering decisions, especially as public broadcasters
    expand service and make the transition from analog to digital
    broadcasting. That assistance is more important now than ever before.
    Please support a $110 million appropriation for the PTFP program for
    fiscal year 2002. Thank you for the Subcommittee's consideration and
    long-standing support for public broadcasting.
        NPR is a private, nonprofit corporation that produces and
    distributes award-winning programming such as Morning Edition, All
    Things Considered, Performance Today, and Car Talk. NPR is also a
    membership organization. NPR Member stations are independent entities,
    licensed to a variety of non-profit organizations, local communities,
    colleges, universities and other institutions. Public radio stations
    independently select and produce community-appropriate programming that
    best serve their listening areas.
                                     ______

                  Prepared Statement of The Nature Conservancy

        Mr. Chairman, I appreciate the opportunity to submit testimony on
    the fiscal year 2002 budget for the National Oceanic and Atmospheric
    Administration (NOAA).
        The Nature Conservancy is an international, non-profit organization
    dedicated to conserving biological diversity. Our mission is to
    preserve the plants, animals, and natural communities that represent
    the diversity of life on Earth by protecting the lands and waters they
    need to survive. We have more than a million individual members, over
    1,500 corporate members, and programs in every state and in 20 nations.
    We have protected more than 11 million acres within the United States
    and Canada, and have helped local partner organizations preserve
    millions more overseas. Additionally, we own the largest private system
    of nature preserves in the world.
        Since 1950, The Nature Conservancy has maintained a strong focus on
    land-based habitats. However, in the past decade, we have recognized
    that to accomplish our mission we must also focus on critically
    important and productive freshwater, coastal, and marine habitats--
    particularly habitats such as estuaries, coral reefs, mangroves, and
    seagrass beds that are heavily affected by human activities. We are
    aware that coastal areas and oceans contain biodiversity rivaling
    tropical rain forests. Yet as a nation we have focused little attention
    on their conservation.
        As a result, The Nature Conservancy is escalating its focus on
    freshwater, coastal, and marine conservation areas using the sound
    science, strong partnerships, ecosystem approach, and site-based
    conservation that has proven effective throughout our 50-year history.
    We are working with public and private partners to develop a
    ``conservation blueprint'' that will identify the terrestrial,
    freshwater, coastal, and marine sites at several scales, that together
    if conserved will protect the nation's unique array of plants, animals,
    and natural communities for the long-term.
        Several NOAA programs have proven especially successful at
    combining effective management, good science, and community involvement
    to achieve tangible and lasting conservation results. These programs
    will also facilitate the process of conserving many conservation areas
    identified by the Conservancy's conservation blueprint. These programs
    include:
      --National Estuarine Research Reserve System
      --National Marine Sanctuaries
      --Habitat Restoration
      --Salmon Recovery
      --Marine Protected Areas
      --Coral Reef Conservation
                   national estuarine research reserve system
        These twenty-five ``living laboratories'' have historically made
    the most of a modest annual budget. However, last year the National
    Estuarine Research Reserve System (NERRS) received a funding boost that
    should be built upon in fiscal year 2002, as appropriate to the
    importance of estuaries to critical habitat and coastal economies.
        Adequate funding for the NERRS ($18 million for operations; $7
    million for CZM Administration; $15 million for procurement,
    acquisition, and construction) will permit individual reserves to
    better implement strong management, research, education, and
    stewardship activities within surrounding communities, build necessary
    facilities, and acquire key tracts of land and conservation easements
    in order to buffer reserves from development impacts. Additional
    funding would also facilitate implementation of system-wide monitoring
    and coastal training programs, and eventually the expansion of the
    system, permitting it to officially represent the suite of
    biogeographic regions that together comprise our nation's coastlines.
        As manager of more than 1,300 preserves, we appreciate increased
    funding for the NERRS. Estuaries serve as ``nature's water treatment
    system,'' providing flood control, storm damage protection, recreation,
    and habitat for species to spawn, nurse, and live. The Conservancy
    works in several reserves including New Hampshire's Great Bay,
    Florida's Apalachicola Bay, Alaska's Kachemak Bay, South Carolina's ACE
    Basin, and Mississippi's Grand Bay. We know first hand that the NERRS
    has implemented solid science to inform communities about how coastal
    ecosystems function, how humans affect them, and methods for improving
    their condition.
                          national marine sanctuaries
        The Nature Conservancy supports the President's request for $36
    million to fund the National Marine Sanctuary Program. This funding
    would extend volunteer programs, provide for additional monitoring, and
    enable all sanctuaries to meet critical, long-term needs. It would also
    fulfill a national plan for visitor interpretive centers and public
    outreach activities. Additionally, new investments in science are
    needed to fully understand the complex issues that will lead to better
    sanctuary management. Finally, as revised and more detailed management
    plans are developed for individual sanctuaries, additional funding will
    be needed for their implementation.
        National Marine Sanctuaries embody some of the world's most diverse
    ecosystems. The thirteen sanctuaries established since 1972 protect
    18,000 square miles of ocean waters. They aid in the recovery of
    endangered marine animals, lessen the threat of oil spills, increase
    knowledge of the ocean through research, and enlarge a stewardship
    ethic among citizens. Where appropriate, uses such as recreation,
    commercial fishing, and shipping are also permitted.
        The Conservancy's most extensive experience with this program has
    been in the Florida Keys where a sanctuary was established to stem
    threats to the ecological health of the coral reef ecosystem. In
    cooperation with the state of Florida and an Advisory Council
    (representatives from commercial and recreational fishing, the dive and
    boating industries, public interest organizations, scientific and
    educational organizations, and the public) the Sanctuary developed and
    is implementing a comprehensive management plan. The plan focuses on
    issues and activities including education and outreach, enforcement,
    research and monitoring, and zoning. It also concentrates on solutions
    for water quality problems related to stormwater runoff, sewage
    treatment, live-aboards, hazardous spills, and pesticides. It is
    showing promising results.
                              habitat restoration
        Coastal ecosystems are powerful drivers of the United States
    economy, with more than 180 million people visiting the coasts
    annually. By 2010, 75 percent of the United States population is
    expected to live within fifty miles of the coast. Tourism, recreation,
    fishing, and other industries require healthy coastal habitats and
    clean waters. Yet, harmful algal blooms, polluted beaches and waters,
    contaminated shellfish beds, and diseased coral reefs are signs that
    human activities are degrading valuable habitat coastal resources.
        The Nature Conservancy strongly supports NOAA's coastal habitat
    restoration efforts, and recommends sustaining funding levels of $18
    million for Fishery Habitat Restoration. Most of this funding would
    ensure the continued success of NOAA's Community-Based Restoration
    Program that together with national partners, has inspired local
    efforts to conduct meaningful, on-the-ground restoration of freshwater,
    coastal, and marine habitat. This funding level would bring more seed
    money to local communities across the country for the restoration of
    vital coastal habitats including wetlands, seagrass beds, mangroves,
    anadromous fish spawning areas, and coastal rivers. Additionally, it
    would increase this successful program's geographic scope and rate at
    which it can encourage community ownership and restoration of critical
    and rapidly dwindling habitat. This program has not only leveraged $4-
    $10 for every federal dollar invested at more than 177 projects, but
    has also leveraged a conservation ethic across the nation.
                                salmon recovery
        Salmon travel hundreds of fresh and saltwater miles past cities,
    dams, farms, and forests during their life cycle. As a result, it is
    necessary to focus at a landscape-scale to determine what salmon need
    to survive. Such an approach benefits other species dependent upon
    cool, clear water and quality habitat. This includes humans, who desire
    flood prevention, improved water quantity and quality, reduced erosion,
    and recreational opportunities.
        Habitat destruction, reduced streamflows, pollution, passage
    impediments or blockage from hydropower and other developments, and
    over-harvest have all played a role in the decline of Pacific salmon
    stocks. Adequate funding to conserve and recover salmon ($200 million
    for the Pacific Coastal Salmon Recovery Fund; $55 million for NMFS
    Agency Funding for Pacific Salmon Recovery) is critically needed. The
    Pacific Coastal Salmon Recovery Fund enables states and tribes to fund
    local efforts that evaluate, protect, and restore key habitat. NMFS
    Agency funding would further critical scientific research and
    monitoring, spur new partnerships and cooperative efforts, and
    implement protections under the Endangered Species Act.
        History has demonstrated that a good portion of money spent on
    habitat restoration and recovery could been used more effectively and
    at less cost to the taxpayer if applied before systems were altered and
    degraded. It is time to make tough choices about how to conserve
    functioning systems with healthy habitats and salmon populations for
    the long-term.
                             marine protected areas
        Marine protected areas (MPAs) are proven tools for rebuilding and
    sustaining fisheries, recovering threatened and endangered species, and
    providing recreational opportunities. The Conservancy has learned this
    first hand through work with scientists, community members,
    international governments, and federal agencies to establish MPAs and
    identify and protect biodiversity within them in places such as the
    Florida Keys, the Exuma Cays Land and Sea Park in the Bahamas, and
    Kimbe Bay in Papua New Guinea. It is time to reserve more of these
    places for future generations, just as the nation has done on land with
    national parks and refuges, national forests, and other specially
    managed areas.
        The Conservancy recommends that $5 million be appropriated so that
    NOAA can work with federal and state agencies and other partners to
    assess the use of MPAs as management tools for the nation's valuable
    marine resources, while permitting recreation and protecting
    biodiversity. Funding would enable completion of the first nation-wide
    inventory of MPAs, which would be applied towards assessing the
    system's effectiveness in meeting partners' goals and the use of MPAs
    as management tools. Funding would support needed research on MPA
    design and implementation to meet different goals, and would also
    support training and technical assistance for communities, users,
    management agencies, and others. Finally, funding would be used to
    share lessons and information, and to increase public involvement
    through the MPA web site.
                            coral reef conservation
        Coral reef ecosystem health has declined severely all over the
    world in recent decades. The combined effects of global climate changes
    and human activities have put coral reefs at great risk. It is now
    critical to take action before the tragedy becomes irreversible. As a
    result, the Conservancy has been working throughout the world with
    governmental and non-governmental partners to protect these fragile
    systems.
        The Nature Conservancy supports the President's budget for
    activities that benefit coral reefs ($16 million for NOS; $11 million
    for NMFS; $700,000 for NESDIS; $500,000 for OAR). Also supported by the
    United States Coral Reef Task Force, these activities include
    comprehensive mapping and monitoring of coral reefs, research into
    ecological processes upon which reefs depend, enhanced international
    activities, integration of human activities, and public education. With
    such funding, this scientifically-based effort will protect and restore
    coral reefs in the United States and its territories. It will also
    serve as a model in intergovernmental coordination, and in coral reef
    protection for similar initiatives in the rest of the world.
                                   conclusion
        Thank you for the opportunity to submit these remarks. Conservation
    of coastal waters is challenging since many marine habitats cannot be
    purchased and set aside for conservation. Instead, we must employ a
    variety of strategies at every level to conserve and restore these
    valuable places. The Nature Conservancy looks forward to working with
    NOAA, other federal agencies, state and local governments, non-
    governmental organizations, and the private sector to ensure the long-
    term protection and sustainable use of our productive and diverse
    coastal waters.
                                     ______

       Prepared Statement of the University Corporation for Atmospheric
                                    Research

        On behalf of the University Corporation for Atmospheric Research
    (UCAR) and the university community involved in weather and climate
    research and related education, training and support activities, I
    submit this written testimony for the record of the U.S. Senate
    Committee on Appropriations, Subcommittee on Commerce, Justice, State
    and the Judiciary. My testimony pertains to the fiscal year 2002 budget
    request for the National Oceanic and Atmospheric Administration (NOAA).
        UCAR is a university membership consortium composed of 63 North
    American institutions that grant the Ph.D. in atmospheric, oceanic, and
    related sciences. The UCAR mission is to support, enhance, and extend
    the capabilities of the university community, nationally and
    internationally; to understand the behavior of the atmosphere and
    related systems and the global environment; and to foster the transfer
    of knowledge and technology for the betterment of life on earth. UCAR
    is a non-profit, Colorado-based corporation that manages and operates
    the National Center for Atmospheric Research (NCAR) and the UCAR Office
    of Programs (UOP). It is supported by the National Science Foundation
    (NSF) and other federal agencies including NOAA. In addition to its
    member universities, UCAR has formal relationships with approximately
    100 additional undergraduate and graduate schools including several
    historically black and minority-serving institutions and 38
    international universities and laboratories.
        On behalf of this country's atmospheric sciences community, I urge
    the Committee to support at the highest level possible the research,
    training, and observations activities of the National Oceanic and
    Atmospheric Administration. NOAA provides a comprehensive approach to
    understanding the atmospheric and oceanic systems of the earth and to
    implementation of programs that save American lives, energy, money and
    property. The weather and climate data collected by NOAA satellites,
    ships, ocean buoys, aircraft, and other instrumentation provide the
    foundation on which atmospheric sciences research is based. Support for
    NOAA should be maintained at the highest possible levels given the rate
    at which the world's climate is changing and during this era of rapid
    scientific discovery and intense, global economic competition.
        Within NOAA, I would like to comment on the following offices and
    programs:
                         national weather service (nws)
        I urge the Committee to support the NWS request of $727.6 million,
    a net increase of $34.8 million above the fiscal year 2001 enacted
    level. The National Weather Service will put this increase to excellent
    use in making available critical weather and climate-related data,
    improving weather prediction accuracy and warning lead times, and
    working to decrease weather related fatalities. There are few agency
    programs that impact our daily lives and the health of our economy as
    profoundly as does the NWS. Within NWS, I would like to comment on the
    following programs:
    Forecaster Training and Related Research Programs
        Support for NWS forecaster training has declined over the past
    three years from a high of about $20 million to the current figure of
    approximately $12 million. Rapidly expanding new technologies and
    dramatic advancements in the field of meteorology, combined with
    impacts of increased weather and climate variability, have created a
    pressing demand for professional development of the NWS workforce and
    collaborative research activities with universities and laboratories.
    This is the time, not to cut back on this activity, but to expand it. I
    urge the Committee to support, mainly in the NWS travel budget, an
    amount of $15 million (without harming any other programs within NWS)
    to make adequate training of NWS forecasters possible through proven
    and highly successful programs such as the UCAR-based Cooperative
    Program for Operational Meteorology, Education and Training (COMET).
    Radiosonde Replacement Network
        The antiquated upper air radiosonde network is in dire need of
    replacement. There is little doubt that the obsolete infrastructure for
    this principle data source on upper air for all weather forecasts and
    models will fail by 2005 if it does not receive adequate modernization
    funding now. When the network falls apart, this nation, the richest on
    earth, will suffer widespread loss of data that are essential for
    accurate forecasting across the country. Funding should be appropriated
    now that will allow the NWS to replace antiquated computers, continue
    software development, and procure critical surface instruments. The
    requested amount of $5 million is not adequate. I urge the Committee to
    increase the recommended funding for the Radiosonde Replacement Network
    from $5 million in the Procurement, Acquisition and Construction (PAC)
    account, to the critically needed amount of $7 million without harming
    any other programs within NWS.
    Advanced Hydrologic Prediction System (AHPS)
        The need to implement AHPS nationwide is being demonstrated right
    now as the Mississippi and Red Rivers rise to dangerous levels. This
    real time modeling and data analysis system will significantly improve
    flood forecasting, water management, and risk-based decision making in
    flood-prone areas such as the Mississippi and Ohio River Basins. It
    will save lives and property by providing river stage forecasts one-to-
    two months in advance, a great improvement on the several days advance
    notice now available. The proposed $1 million for fiscal year 2002
    simply will not provide the coverage that is needed. Within the NWS ORF
    account, I urge the Committee to support $3.5 million for national
    implementation of AHPS without harming any other NWS programs.
    Co-Operative Observer Network
        I urge the Committee to support the request of $2.3 million in the
    Operations, Research, and Facilities (ORF) account to sustain the
    volunteer operated Cooperative Observer Network. The network's 11,000
    weather observation sites are used to maintain the country's climate
    record and to provide data to NWS local field offices and to university
    laboratories. The National Research Council has recommended taking
    immediate steps to modernize this ailing, critical network. This
    achievement of modernizing, as opposed to just sustaining, will
    necessitate enhanced future funding. This year's recommended funding
    will rescue the network from collapse, but increased funding for
    modernization should begin in fiscal year 2003. Any investment in this
    infrastructure will reap immediate dividends in energy savings realized
    from improved weather data.
    National Centers for Environmental Prediction (NCEP)
        NCEP is comprised of nine centers within the NWS, all working
    together toward the common goal of using data for weather predictions
    and seasonal forecasts in order to save lives, protect property, and
    create economic opportunity. Weather Service field offices, other
    government agencies, research universities, the U.S. Weather Research
    Program, and private meteorological services rely on NCEP's products.
    Forecasts that reach the public via media outlets originate at NCEP. In
    recent years, the centers have been supported inadequately to process
    weather data and transfer it into operations. In order to help fix this
    problem, I urge the Committee to support the recommended $1.7 million
    to sustain current operations of the NCEP Environmental Modeling
    Center, and the recommended $3.0 million for NCEP Data Assimilation and
    Modeling.
    Advanced Weather Interactive Processing System (AWIPS)
        Under NWS Public Warning and Forecast Systems in the Operations,
    Research and Facilities (ORF) account, I urge the Committee to support
    the fiscal year 2002 proposed amount of $38.4 million for AWIPS
    Operations and Maintenance. This interactive computer system, the
    cornerstone of the recently completed NWS modernization and
    restructuring, integrates for the first time all meteorological and
    hydrological data, and all satellite and radar data. AWIPS is a
    critical source of data for the research community and enables the NWS
    to issue far more effective weather warnings and forecasts in a very
    efficient manner. Under NWS Systems Acquisition in the Procurement,
    Acquisition and Construction (PAC) account, we urge the Committee to
    support the proposed fiscal year 2002 amount of $16.3 million for AWIPS
    to continue development of AWIPS software. When integrated with NEXRAD
    Product Improvement technology, this new software will allow NWS
    forecasters to significantly improve tornado warning lead times and
    improve the accuracy of severe storm forecasts.
                office of oceanic and atmospheric research (oar)
        OAR functions are critical to the process of conducting research
    and linking the results to operations. The office supports a world-
    class network of scientists and environmental research laboratories as
    well as partnerships with academia and the private sector in order to
    provide the sound science upon which decision makers can frame
    effective regulations to solve environmental problems. Society's demand
    and economic need for the OAR labs' information services have increased
    dramatically in such areas as predictions of El Nino/La Nina events,
    tropical storm intensity, flooding and drought. To realize the full
    benefit to society, I urge the Committee to enhance support for the
    extremely critical services provided by OAR. OAR's most important
    research efforts conducted with universities include the following:
    U.S. Weather Research Program (USWRP)
        This interagency program, authorized by Congress in 1992, was first
    mentioned in NOAA's budget in fiscal year 2000. I am encouraged that
    this program is receiving an additional $2.2 million this year, but
    even the recommended amount of $3.7 million falls far short of the
    annual $12.5 million recommended in the Congressionally mandated
    implementation plan. The USWRP research community is poised to make
    significant gains in prediction capabilities regarding heavy
    precipitation (that can result in the kind of flooding we see now on
    the Mississippi and Red Rivers) and hurricane landfall location and
    intensity. The disaster relief savings of such gains would be many
    times the initial research cost investment, not to mention the value of
    lives saved. I urge the Committee to provide the USWRP with at least
    $10 million for fiscal year 2002. This relatively small increment in
    funding would have a major impact on the increased accuracy of weather
    forecasts.
        Since the USWRP is an interagency program the goals of which
    advance the NOAA mission, we would suggest that NOAA take the lead in
    collaborating with the National Science Foundation (NSF), the National
    Aeronautics and Space Administration (NASA), and the Department of
    Defense (DOD) to ensure appropriate support from these agencies.
    Climate and Global Change Program
        The Climate and Global Change program is an integral part of the
    interagency U.S. Global Change Research Program (USGCRP) that addresses
    our understanding of the global climate system including knowledge and
    prediction of climate variability patterns and the occurrence of severe
    weather events. The research funded by this competitive grants program
    improves the regional specificity and detail of climate forecasts,
    which is essential progress to advancing our understanding of the
    Earth's climate. In fiscal year 2001, funding for this program was
    $68.35 million; fiscal year 2002 funding is recommended at only $68.71
    million, an increase that is far below the rate of inflation. I urge
    the committee to support, without harming other NOAA programs, at least
    a 4 percent increase for the Climate and Global Change Program for a
    fiscal year 2002 funding level of $71.0 million.
    Climate Observations and Services Program
        This initiative, begun in fiscal year 2001, meets the growing
    demand for timely data and information about climate variability,
    climate change and trends in severe weather events. The work of the
    program will support new ocean observations and infrastructure that
    will provide essential data to understanding aspects of climate change.
    I urge the Committee to support the fiscal year 2002 request of $24.0
    million for the Climate Observations and Services Program, a $13.0
    million increase over fiscal year 2001 levels.
    Boulder Facilities Operations
        In addition to supporting the research programs above, I urge the
    Committee to support the request of $5 million for Boulder Facilities
    Operations. Six of the 12 laboratories that make up NOAA's Office of
    Oceanic and Atmospheric Research (OAR) Laboratories are housed in
    Boulder at the David Skaggs Research Center. The Center is also the
    home of two NESDIS Data Centers, one of OAR's 11 Joint Institutes, and
    the Denver Forecast Office of the National Weather Service (NWS). The
    $5 million in requested funding will meet operating costs for space,
    utilities, maintenance and security at this facility.
    National Environmental Satellite, Data and Information Service (NESDIS)
        For several years we have been concerned about the proposed level
    of funding in the NESDIS Operations, Research and Facilities (ORF)
    account. We are pleased to see that overall support demonstrated in
    last year's increase for this account is being continued, but we still
    have grave concerns about critical programs within NESDIS that are
    actually recommended for significant cuts. This account is divided into
    support for the Satellite Observing Systems and the Environmental Data
    Management Systems. The Satellite Observing Systems provide services in
    designing, developing, and operating civilian satellite systems for the
    purpose of observing ocean, and atmospheric conditions and the sun.
    These are observational tools critical to improving our knowledge of
    the complex environmental systems in which we live. I urge the
    Committee to support the request of $75.9 million for NESDIS Satellite
    Observing Systems, an increase of $15.7 million over the fiscal year
    2001 enacted level.
        The rich data collected by the NESDIS satellite systems are
    acquired, processed, analyzed, archived and disseminated through the
    Environmental Data Management Systems to commerce, industry,
    agriculture, science and engineering, the general public, and
    government at all levels. While the Satellite Systems function collects
    data, the Data Management Systems function makes those data useful and
    available. Both sides of the equation are of equal importance, and we
    are disturbed to see that the data management function is recommended
    for a $9.0 million decrease. An increase in funding for the observing
    systems that collect data obviously should be coupled with an increase
    in funding for the management systems that make the collected data
    useful and accessible. The budget language within the Data and
    Information Services section itself makes the argument for an increase
    stating that, ``Requirements have expanded due to growing customer
    demands for data and products, and increases data management as the
    volume of new data continues to grow.'' I urge the Committee to restore
    the NESDIS Environmental Data Management Systems to the fiscal year
    2001 enacted level of $64.8 million without harming base funding for
    any of the other worthy programs of NESDIS.
    Minority Serving Institutions
        While the recommended increase will not cover the cost of
    inflation, we are pleased to see the continuing commitment to Minority
    Serving Institutions (MSIs), a program begun in fiscal year 2001. In
    order to have a productive scientific workforce now and in future
    years, the pool of qualified applicants must be as diverse as the
    population at large. Under-representation of minorities in earth
    science disciplines in this country is a serious issue that must be
    addressed by multiple programs across multiple agencies and
    institutions. I urge the Committee to support the $15.0 million request
    for NOAA's Minority Serving Institutions initiative and to increase
    that amount, if possible, without harming other NOAA programs.
        On behalf of UCAR, I want to thank the Committee for the important
    work you do for U.S. scientific research, education, and training. We
    appreciate your attention to the recommendations of our community
    concerning the fiscal year 2002 budget.
                                     ______

          Prepared Statement of the American Museum of Natural History

                  about the american museum of natural history
        The American Museum of Natural History [AMNH] is one of the
    nation's preeminent institutions for scientific research and public
    education. Since its founding in 1869, the Museum has pursued its
    mission to ``discover, interpret, and disseminate--through scientific
    research and education--knowledge about human cultures, the natural
    world, and the universe.'' It is renowned for its exhibitions and
    collections of more than 32 million specimens and cultural artifacts.
    With nearly five million annual visitors--approximately half of them
    children--its audience is one of the largest, fastest growing, and most
    diverse of any museum in the country. More than 200 Museum scientists
    conduct groundbreaking research in fields ranging from all branches of
    zoology and paleontology to earth, space, and environmental sciences
    and biodiversity conservation. Their work forms the basis for all the
    Museum's activities that seek to explain complex issues and help people
    to understand the events and processes that created and continue to
    shape the Earth, life and civilization on this planet, and the universe
    beyond.
        In its exhibition halls AMNH scientific knowledge and discovery are
    translated into three dimensions. One of the most exciting chapters in
    the Museum's history culminated just over one year ago with the opening
    of the Rose Center for Earth and Space in February 2000. Greeted with
    critical and popular acclaim and record-setting attendance surpassing
    all projections, the Rose Center includes a rebuilt Hayden Planetarium,
    Hall of the Universe, and Hall of Planet Earth. It leads to the Hall of
    Biodiversity, which reveals the variety of Earth's living things and
    expands the Museum's efforts to alert the public to the critical role
    biodiversity plays in sustaining life as we know it and to the
    ecological crisis we now face. Together, the new planetarium and halls
    provide visitors a seamless educational journey from the universe's
    beginnings to the formation and processes of Earth to the extraordinary
    diversity of life on our planet.
                  common goals of noaa and the american museum
        Today, as throughout its history, the National Oceanographic and
    Atmospheric Administration [NOAA] is committed to describing and
    predicting changes in Earth's environment and to conservation and wise
    management of the Nation's coastal and marine resources. It dedicates
    itself to forecasting environmental changes, providing decision makers
    with reliable scientific information, and fostering global
    environmental stewardship.
        The American Museum shares NOAA's commitment to these environmental
    goals and to the scientific research and public education that underlie
    them. Indeed, informed environmental stewardship and preservation of
    our planet's biodiversity and resources--in the marine, coastal, and
    other natural environments and habitats--are integral to the Museum's
    most fundamental purposes. The Museum is now poised to launch the
    following initiatives in which it seeks to partner with NOAA to advance
    our shared environmental research, stewardship, and public information
    goals.
                 public education in marine and ocean sciences
        Public understanding of the natural world has taken on new urgency
    in an era of dramatic discoveries affecting our understanding of the
    oceans, widespread species and habitat loss, and weather shifts around
    the globe. To meet this vital need for understanding of the complex
    natural phenomena affecting people and the planet, the Museum is
    planning a major initiative about our planet's last frontier--the
    oceans.
        In the year ahead the Museum will embark upon an ambitious
    renovation of one of its flagship halls, the Hall of Ocean Life. The
    new hall will provide a rich context for the latest marine research and
    will help to bring the marine realm into public focus, educating the
    public about current research into the oceans' vital role in the life
    of our planet. The renovation will bring new technologies and media
    together with living creatures, restored classic dioramas, and
    treasured icons like the 94-ft. model Blue Whale to educate audiences
    of all ages about earth as a marine habitat, a water planet, and about
    the diversity of life in and near the water.
        The Hall of Ocean Life is one of the Museum's grand exhibition
    spaces. First constructed in 1924 and last renovated in 1969, the
    29,000 square foot hall is comprised of two levels, the main floor and
    the mezzanine. The main floor, at 16,000 square feet, features 15
    historic dioramas and a two-story Andros Coral Reef diorama. These
    dioramas are widely recognized as treasures of a distinctive art form
    used as a method of environmental education by natural history museums,
    primarily in the United States, Canada, and Scandinavia, in the first
    half of the twentieth century. The mezzanine level currently features
    an exhibition on the phylogeny of fishes, which includes more than 400
    models. Renovation plans will transform the Hall into a fully immersive
    simulated marine environment with video projection screens, interactive
    computer kiosks, and an aquarium. The most important concepts to be
    conveyed to Ocean Life visitors are that the oceans support a highly
    diverse and complex web of life--and that there is a critical
    connection between the ocean and our own survival. Earth's oceans make
    life possible, and together, the oceans represent the largest habitat
    on Earth, supporting the greatest diversity of life on the planet.
    Themes of biodiversity and interconnectedness will recur throughout the
    exhibition's narratives, complementing and expanding upon the adjoining
    Biodiversity Hall.
        The new design plan includes not only extensive restoration of
    existing elements, such as the dioramas, but also a complete renovation
    of the mezzanine level to incorporate more integrated depictions of
    ocean life through models, specimens, and new multimedia elements.
    Invertebrates, including elements from the recently closed Hall of
    Mollusks as well as marine plants, will appear in the hall as integral
    components of the various habitats on display.
        Highlights of planned exhibition elements include the following:
      --Habitat stories.--A different marine habitat will be featured in
            each of eight niches that line the North and South walls of the
            mezzanine. The habitats will serve as windows onto the ocean
            world, organizing the scientific information into eight self-
            contained, ecological stories. Each niche will feature a vivid
            depiction of the particular habitat using models and specimens
            along with various forms of signage, and a series of plasma
            screens above the glass-enclosed displays will create a ``video
            necklace'' around the mezzanine. The videos will feature high
            definition images of each habitat, showcasing marine ecosystems
            from around the world.
      --Additional Mezzanine Elements.--Other niches on the mezzanine level
            will focus on subjects such as the evolutionary history and the
            morphology of fish and aquatic invertebrates. There will also
            be a niche devoted to the evolutionary development of the
            oceans and ocean life, featuring dioramas depicting life in the
            ancient oceans and authentic seafloor fossilized slabs that
            visitors can touch. Flanking the mezzanine-level entrance to
            the Hall will be two small theatres presenting videos on basic
            oceanography and impacts of human activity on the marine world.
      --Walls of Species.--On the main floor, a ``Wall of Fishes'' will
            display an array of 75-100 models of freshwater and marine fish
            and traces the evolutionary relationships among all fish
            species alive today. An adjacent ``Wall of Marine
            Invertebrates'' exhibit will spotlight the more than 30 phyla
            of marine invertebrates. Both walls will echo a Spectrum of
            Life Wall in the adjoining Hall of Biodiversity, reinforcing
            the intricate evolutionary connections among all living
            creatures.
      --The Blue Whale.--The renovated hall will still feature the
            monumental Blue Whale, but the Museum will provide more
            extensive and up-to-date information about aspects of cetacean
            biology and conservation and relevant research developments
            around the globe.
      --Aquarium.--A planned state-of-the-art aquarium, with a 40-foot tank
            that holds 16,000 gallons of sea water, will depict an Indo-
            Pacific ``patch reef'' (the edge of a coral formation emerging
            from the sandy sea floor), featuring a brilliant display of
            fish and invertebrates swimming through a forest of indigenous
            corals and gorgonians.
      --Marine research.--The renovated Hall of Ocean Life will also
            educate the public about current marine research, including
            analyses from the proposed GIS facility described below. This
            information will expand on themes developed in the Museum's
            Halls of Biodiversity and Planet Earth, such as the oceans'
            impact on shaping weather patterns and climate, threats to the
            health of oceans and coasts, and other topics pertinent to the
            Museum's and NOAA's core concerns.
        We seek to partner with NOAA in this undertaking to create new
    educational exhibits to introduce 21st century museum visitors to the
    abundance and the wonder of ocean life as well as the architecture of
    its currently endangered ecosystems. We do not seek funds for capital
    costs but for exhibition display.
           geographic information systems for environmental research
        Tied to our public education initiative, our second proposed
    initiative concerns cutting-edge technologies for basic and applied
    environmental research. New technologies in Geographical Information
    Systems [GIS] and remote sensing are revolutionizing the way
    environmental research can be conducted and data analyzed. At the same
    time, they are revolutionizing the ways museum collections can be used
    and accessed by scientists, educators, policy makers, and the general
    public. The American Museum of Natural History has long been at the
    forefront of developing new modes and methods of scientific research.
    The explosion of technology in GIS creates a window of opportunity for
    the Museum to develop new ways to integrate this state-of-the-art
    analytical tool into our leading-edge research and present results to
    the public in our exhibition halls.
        Wise environmental stewardship and conservation policy require
    effective knowledge of the distribution of species and ecological
    communities at local, regional, and global scales. Without this
    information, it is difficult to decide where to allocate scarce
    conservation resources. While remote sensing provides a tool for
    calculating and visualizing changes in the distribution of natural
    communities and human-dominated landscapes at all these different
    scales, GIS enables researchers to compare more detailed information
    (such as distribution of species, streams, habitat features) from
    different sources at the same scale. Throughout its zoology,
    paleontology, earth and space science and anthropology divisions and
    its Center for Biodiversity and Conservation, AMNH investigators are
    exploring GIS applications to advance research pertinent to
    conservation, protecting threatened species, and safeguarding marine
    habitats. These applications include the following:
      --Conservation research.--GIS is becoming an indispensable component
            in environmental data analysis, providing the database backbone
            that can connect field work to analysis. It unites satellite
            and legacy data with raw standardized samples and ground
            truthing, and is revolutionizing work in conservation. AMNH
            researchers studying endangered ecosystems, marine species, and
            marine reserves, for example, can use GIS to develop finer,
            tighter, more precise datasets, while GIS analysis enables
            researches to ask more sophisticated and flexible questions,
            and to discover patterns, series, and gradations.
      --Collections data and access.--GIS can bring the Museum collections
            of more than 32 million specimens and artifacts alive and
            increase exponentially the analyses that researchers can carry
            out for conservation research and decision making. By coupling
            GIS with the Museum's increasingly strong AMNH web presence to
            provide easy access, researchers worldwide will be able to pose
            more sophisticated questions and uncover new connections and
            relationships among our collections data. For example, by using
            georeferenced data, researchers can compare current maps with
            legacy data to trace environmental changes over time.
      --Public education.--To present current science news the Museum has
            created the Science Bulletins. These high definition video
            reports feature breaking science developments and discovery in
            high definition wall displays in the Halls of Biodiversity,
            Planet Earth, and the Universe. With access to GIS applications
            and datasets, they can be adapted for the Hall of Ocean Life
            content as well; and present the public with global earth
            science-related datasets, maps, marine biodiversity reports,
            ocean life discoveries, and more.
      --The Museum's Center for Biodiversity and Conservation [CBC] has had
            noted success with their piloted Remote Sensing and
            Geographical Information System (GIS) laboratory since the fall
            of 1998. It has been using GIS in biodiversity and marine
            reserve research; for example, to identify sites suitable for
            biological inventory; provide supplementary quantitative and
            qualitative data in and around study sites (e.g. extent of
            habitat fragmentation); and development of persuasive visual
            depictions and digital presentations for reports, publications,
            and meetings.
        These successes and uses for GIS demonstrate the Museum's enormous
    potential for using GIS to help advance environmental forecasting,
    provide decision makers with reliable scientific information, and
    foster global environmental stewardship. We therefore seek to partner
    with NOAA in establishing a Museum-wide GIS resource center to
    facilitate integrated research, education, and access in these areas so
    crucial to sound environmental stewardship. We seek support not for
    bricks and mortar but for GIS research and education applications.
        The Museum brings to the proposed NOAA partnership a public
    platform of tremendous power and reach. Since the Rose Center opened,
    the American Museum's annual onsite audience has increased 45 percent,
    to nearly five million annual visitors. In addition, the Museum's
    website enjoys an average of more than 16,000 unique online visitors
    each day. The Hall of Ocean Life will increase this audience even more.
    Our joint efforts, therefore, are positioned in the years ahead to
    reach a combined onsite and online audience that could reasonably
    approach 10 million. We also plan to carry out these proposed strategic
    initiatives with funds from nonfederal as well as federal sources. The
    Museum has a highly successful track record in private fundraising, and
    we are confident that we will be able to leverage any federal
    investment favorably.
        In sum, we request $1 million to join in partnership with NOAA in
    developing these research and public education initiatives. By
    generating critical scientific knowledge through GIS applications and
    public education about the vital role of ocean and marine environments,
    we can advance our shared commitment to environmental stewardship for
    the generations to come.
                                     ______

      Prepared Statement of the University of Miami, Coral Gables, Florida

        Mr. Chairman and Members of the Subcommittee, I appreciate the
    opportunity to present a statement for the Record on behalf of my
    colleagues at the University of Miami and its Rosenstiel School of
    Marine and Atmospheric Science, the schools of Medicine and Law, and
    the Dante B. Fascell North-South Center. We respectfully seek your
    support in fiscal year 2002 for three projects at the University of
    Miami. First, a new project dedicated to improving our understand of
    wild fish populations and to developing a sound scientific basis for
    fisheries management through the National Oceanographic and Atmospheric
    Administration; a timely and new initiative, the Healthcare and Elder
    Law Policy (HELP) Center through the Department of Justice and its
    National Institute on Justice and/or its Bureau of Justice Assistance;
    and continuing support for a unique national resource, the Dante B.
    Fascell North-South Center through the United States Information
    Agency.
        Founded in 1925, the University of Miami is the largest private
    research university in the Southeastern United States and the youngest
    of 23 private research universities in the nation that operate both law
    and medical schools. Through its 14 colleges and schools, more than
    2,300 faculty instruct almost 14,000 undergraduate, graduate, and
    professional students in facilities located on four major campuses.
                      the center for sustainable fisheries
        The Rosenstiel School is recognized as one of the premier academic
    oceanographic research facilities in the world and ranked among the top
    six nationally (by number of faculty, funded research volume, and
    graduate program size). Located on a 16-acre tract on Virginia Key in
    Miami's Biscayne Bay, the Rosenstiel School provides the only
    subtropical marine research facility in the continental United States,
    and is adjacent to and coordinates daily with the national NOAA lab and
    research facility.
        The Rosenstiel School because of its unique location--the Gulf
    Stream is immediately offshore; just to the south lies a vast of
    expanse of the only living coral reef off the shores of the continental
    United States; and just to the east the Florida-Bahamas Carbonate
    Platform--is a unique resource for the nation, as well as for Florida
    and the southeast region.
        There are close to 100 recognized scientists, researchers, and
    educators at the Rosenstiel School who collaborate closely with other
    Florida institutions and whose distinct expertise is vital in
    addressing critical national, regional, and Florida natural,
    environmental, and climatic challenges.
        First, Mr. Chairman, I salute your and the Committee your
    continuing leadership and commitment to programs especially helpful to
    Florida. Everyone in Florida applauds your continuing interest and
    support for the South Florida ecosystem project, for NOAA's investment
    in ocean observation and coastal zone monitoring, and for NOAA's
    improved forecast capability for severe storm and hurricane landfall.
    Respectively, these projects seem to be leading to a new understanding
    of the Everglades-Florida Bay relationship and health, improving the
    health and safety of Florida's coastal communities, and improving
    NOAA's general forecasting capability.
        We respectfully seek $5 million through NOAA for instrumentation
    and equipment costs to develop a state-of-the-art molecular biology
    laboratory ($1.5 million); a computer-based modeling and visualization
    center ($1 million); a flowing sea water source and disposal system ($1
    million); and finally public access, interactive and educational
    facilities and displays ($1.5 million).
        The Center for Sustainable Fisheries will focus on improving
    assessment tools for traditional fisheries data; developing innovative
    approaches for assessment and management; developing habitats to study
    life cycles and histories of selected species, improving population
    dynamic models; and linking science and management with policy
    implications. The Center for Sustainable Fisheries will house strong
    multi-disciplinary teams working on these five major areas of
    investigation, utilizing flowing sea water facilities, high technology
    laboratories, and public educational/interactive areas. The
    construction costs for the facility will be provided through a private-
    pubic partnership, private gifts, support from the University of Miami,
    and other interests.
            the healthcare and elder law policy center (help center)
        The HELP Center is a project dedicated to the development of
    interdisciplinary collaboration in the area of elder healthcare law and
    policy. The Center will provide training and research through the
    Schools of Medicine, Law, Business, and Nursing in healthcare law,
    policy-making and planning for the elderly. The mission of education
    will expand to the Florida healthcare, legal, education, civic and
    business communities. The significant rise in reported incidences of
    elder abuse is a major rationale for this effort. For fiscal year 2002,
    we seek $1 million through the Department of Justice National Institute
    of Justice and/or the Bureau of Justice Assistance.
        The unique demographics of Florida and the special diversity of the
    south Florida populations make the University of Miami a strategically
    important locale for this activity and the HELP Center will serve as a
    national resource. The partnership between the Medical and Law schools
    will be unique and afford significant opportunities for
    interdisciplinary educational research, university and community
    service, and attract unique fundraising opportunities through
    foundations, grants and giving. Placing the University as an expert
    resource at the crossroads of what are emerging as complex healthcare,
    legal, and social issues for a significant number and growing
    percentage of the population should enhance media coverage of legal and
    health issues and enlarge external outreach to the private and public
    sectors. The HELP Center will serve as the conduit to develop faculty,
    administrative, student, and community collaboration and will be a
    place to build university-wide interdisciplinary programs of great
    import.
        The Center will be devoted to five specific missions:
        Education.--The Center will provide undergraduate and graduate
    curricula (medical, law, and postgraduate MD/JD training), continuing
    education symposia (CME, CLE, CEU) and training for the bench, law
    enforcement and other agencies that provide services to the elderly and
    their families.
        Interdisciplinary Ventures.--The Center will be dedicated to the
    development of interdisciplinary programs beyond the core Medical and
    Law Schools. Currently, program development includes three Departments
    within the School of Medicine, (Psychiatry, Medicine and Family
    Medicine) and the UM Center for Adult Development and Aging (CADA).
    Partnerships with other Centers (Center for Women and Children and the
    Center for Family Studies) and Schools (Nursing, Business) and
    departments in the College of Arts and Sciences (Social Sciences,
    Political Science, Psychology) will be sought. Additionally, the Center
    will to develop liaisons with community and national organizations
    (business, civic, education, and legal, allied health professionals)
    who serve the elderly.
        Research.--The Center will develop and implement funded projects
    that address specific issues of importance for the aging population.
    Target research agenda will include: abuse and neglect of the elderly
    (development of criteria for assessment and prosecution; management
    models for unique care requirements of elderly victims prevention and
    treatment for perpetrators); role of families and caregivers of the
    elderly (cultural diversity and needs assessments, funding and models
    of care); end-of-life care (advance care planning and palliative care
    outcomes and financing); mental capacity (decisionmaking assessment and
    guardianship process; and research ethics (protection of vulnerable
    research subjects). Information generated from the research will be
    documented through national scientific and professional media to the
    public as well as employed in the development of new programs of action
    which are evidence based for maximal success.
        Expert Practice.--The Center will develop a group of experts who
    will serve in collaboration with other University, Medical and Law
    school groups for interdisciplinary teaching and service. The Center's
    faculty will also serve as expert witnesses, and assist in Pro Bono
    work the Law School and Medical, School students provide. Additionally,
    the Center will provide workshops for the public and train appropriate
    groups in self-help advocacy and serve as a referral source (advance
    care planning, last will and testament, health care and other public
    benefit program eligibility applications and appeals protocols).
        National/International Symposia.--The Center will sponsor national
    symposia to address interdisciplinary issues pertaining to the elderly,
    among them on the medical-legal issues of elder abuse and neglect. The
    intent of such symposia is to bring together leaders and diverse
    stakeholders in this area (health care providers, law enforcement,
    judiciary, legislative and policy makers, public groups) who will
    represent their particular concerns and work to develop a consensus
    white paper(s) to begin to address collective solutions.
                    the dante b. fascell north-south center
        Finally, we seek your continued support for the Dante B. Fascell
    North-South Center. As you know, the Center has long enjoyed bicameral
    and bipartisan support and in fiscal year 2002 as in past years, from
    the Administration. The Fascell Center's mission is to promote better
    relations and to serve as a catalyst for change among the United
    States, Canada, and the nations of Latin America and the Caribbean. My
    colleagues there conduct programs of research, public outreach,
    education, training, and cooperative study. It publishes and
    disseminates policy-relevant information on the Americas. The programs
    and activities also foster linkages among academic and research
    institutions, NGOs, governmental institutions both civilian and
    military, and philanthropic and private sectors throughout the
    Americas.
        The Center was authorized originally under the ``Center for
    Cultural and Technical Exchange Between North and South Act of 1990.''
    (Public Law 101-513.) Its mission, as prescribed in the Act, is ``to
    promote better relations between the United States and the nations of
    Latin America and the Caribbean and Canada.'' The Center conducts
    programs of research, public outreach, education, training, and
    cooperative study. It publishes and disseminates policy-relevant
    information on the Americas. Acting as a catalyst for change, the
    Center also fosters linkages among academic and research institutions,
    NGOs, governmental institutions both civilian and military, and
    philanthropic and private sectors throughout the Americas.
        The only institution of its kind in the nation, the Center's
    mission makes it a valuable asset to our national interest. Informed
    and balanced analysis and improved understanding of our neighbors in
    the Western Hemisphere provide us great opportunities to enhance our
    economy, expand our jobs, and learn of risks before they reach
    threatening proportions. Throughout 2000, the Center worked extensively
    with the U.S. Department of State and other government agencies, the
    World Bank, the Organization of American States, private business
    corporations, academic and research institutions, and Latin American
    and Caribbean governments in a series of projects, both new and
    ongoing, aimed at:
      --Creating information technology opportunities in developing areas.
      --Bringing marginalized communities, including women, into the global
            marketplace.
      --Training entrepreneurs and educating businesses and policy makers
            in Latin America and the Caribbean on the challenges and
            opportunities of globalization.
      --Contributing to the study and debate on economic integration in the
            Americas through a Free Trade Area of the Americas (FTAA).
      --Continuing studies concerning weaknesses in political
            representation, failures in the rule of law, and unresolved
            issues in civil-military relations.
      --Collaboration with civil, governmental and academic entities in the
            areas of environmental security and environmental protection in
            the Americas.
      --Studies and collaborative efforts aimed at enhancing the role of
            civil society.
      --Seminars on fiscal and management reform for senior federal and
            state-level officials, to improve efficiency, root out
            corruption and improve measurable results.
        The Center has developed new working partnerships with the Wharton
    School of Business of the University of Pennsylvania, the Croft
    Institute at the University of Mississippi, the Instituto Tecnologico
    de Monterrey (Mexico), and the Universidade Estacio de Sa (Brazil) and
    has strengthened existing relationships with the University of the West
    Indies and the American Assembly of Columbia University. The Center is
    the primary partner in Florida for the Council on Foreign Relations.
    The Center will continue its series of Roundtables in Washington, which
    provide a forum for frank discussion of emerging and high-priority
    policy issues among private sector and NGO representatives, United
    States and foreign government officials, and Congressional staff
    members.
        Following the 2000 election, the Center issued a public memorandum
    to the president-elect, with bipartisan and academic authorship, which
    articulated a forward-looking, coherent Western Hemisphere policy
    agenda. It has been widely read at the State Department and by some of
    the incoming senior officials of the Bush Administration.
        The Center has worked with the U.S. Army War College this year to
    organize a major conference and a subsequent research initiative on
    Colombia and the solutions available to U.S. policy for the most
    serious security dilemma in the Western Hemisphere. The Colombian
    crisis, involving drug trafficking, insurgency and political
    instability threatens the region and U.S. interest.
        The Center is poised once again to play an important role in the
    forthcoming Summit of the Americas III in Quebec City in April 2001. In
    January, the Leadership Council for Inter-American Summitry, organized
    by the Center and consisting of notables from around the Hemisphere,
    met in Miami to draft a report offering recommendations to the heads of
    state who will meet in Quebec. That meeting will be President Bush's
    first multilateral engagement.
        In the last year, the Center has received over $700,000 in program
    support grants from federal agencies, international organizations and
    private donors. These include the John D. and Catherine T. MacArthur
    Foundation, the Tinker Foundation, the Organization of American States,
    the U.S. Agency for International Development, the World Bank, the
    governments of Japan and the Dominican Republic, the DCI Environmental
    Center, Microsoft, AT&T, VISA International, and Heineken. The core
    funding from the Congress has enabled the Center to attract such
    support from private sources.
        Mr. Chairman, by performing its Congressionally mandated mission,
    the Dante B. Fascell North-South Center contributes to our capacity to
    understand and surmount these challenges. At the same time, by
    identifying further opportunities for economic growth and democratic
    deepening, the Center serves as a multiplier for advancing U.S.
    interests in the Western Hemisphere and an inter-American resource for
    dealing with issues of crucial importance to U.S. citizens. For fiscal
    year 2002, we seek $2 million in continuation funding.
        Mr. Chairman, we recognize that this will be another difficult
    year. However, we hope that you and your colleagues on the Subcommittee
    will find it possible to support these three important initiatives that
    deal with issues of crucial national importance. The results of the
    work at the Center for Sustainable Fisheries will make important
    contributions to the national effort to improving our understanding of
    wild fish populations and to developing a sound basis for fisheries
    management. Similarly, our proposal for the Healthcare and Elder Law
    Policy (HELP) Center will address the most critical needs of the
    elderly, and the Dante B. Fascell North-South Center will continue the
    vital international work you have supported through the years.
        Thank you for considering these requests.
                                     ______

       Prepared Statement of the Alachua County, Florida Board of County
                                 Commissioners

        Thank you for allowing the Alachua County Board of County
    Commissioners to submit this written testimony before your Subcommittee
    regarding two critical projects. They are the Partners for a Productive
    Community Enhancement Initiative, and the Comprehensive Management of
    Drug Involved Offenders Initiative.
       partners for a productive community enhancement initiative ($2.3
                         million in funding requested)
        In response to a spiraling crime rate in southwest Alachua County,
    the Alachua County Sheriff's Office requested help from the Board of
    County Commissioners in 1993. Specifically, the Sheriff reported that
    57 percent of its 911 calls came from an area that had only 3.2 percent
    of the County's population.
        The County Commission responded by providing $38,000 in funding for
    a Program Manager to staff the Partners for a Productive Community
    (PPC) Program in fiscal year 1994. The PPC was launched as a strategic
    planning effort with three goals: the establishment of neighborhood-
    based services, the development of public/private partnerships and a
    focus on crime prevention. This Program has enjoyed great success due
    to the coordinated efforts of the Sheriff's Office, the Courts and the
    Alachua County Department of Community Support Services. Furthermore,
    since the inception of this Program, the County has budgeted over $1.6
    million to support the Program through the Community Support Services
    Department and Sheriff's Office. Additionally, over $2.4 million has
    been leverage from other county departments, local social service
    providers and the Sheriff's Office through a local law enforcement
    grant.
        The goal of the Sheriff's Office was to reduce the number of calls
    from the area, and to develop a relationship of trust with the area's
    residents. The goal of the Courts was to help with the swift
    prosecution of cases, and to increase personnel in key areas. Finally,
    the goal of the County's Department of Community Support Services was
    to develop and implement a neighborhood needs assessment, and to
    determine the social service needs in accordance with the results of
    the assessment. The Community Support Services Department was also
    responsible for developing public/private community partnerships, and
    community based organizations comprised of tenants, property owners and
    managers. Thus, this project represents a multi-agency strategy to
    stabilize, revitalize and sustain five specific neighborhoods of
    Alachua County.
        In addition to improving the area's basic infrastructure, federal
    funding is also being requested to provide community recreational
    programs for the area's youth. These activities will provide positive
    alternatives to crime, and allow youth to participate first hand in
    community improvement programs. In doing so, these programs will build
    and encourage positive self-esteem, leadership skills and academic
    achievement. To complement these programs, additional improvements will
    be made in the community Safe Havens. Finally, the requested funding
    will also allow the PPC to expand this successful demonstration program
    into other at risk Alachua County communities such as Archer, Florida.
    Specifically, the PPC will develop a partnership strategy to address
    the unmet needs of health care, education, training, employment, youth
    recreation and transportation for the residents of Archer.
        This request for federal funding is justified by the tremendous
    improvements and accomplishments that have been made in these
    neighborhoods since 1995. These achievements include: free community
    day care for 75 children, 30 community day care slots, 24 in-home day
    care slots, the creation of 30 new jobs by the Early Progress Center,
    the reduction in 911 calls from 57 percent to 14 percent of total calls
    in the area, and substantial increases in the property values for four
    of the five neighborhoods.
        Furthermore, the implementation of seasonal recreation programs in
    the targeted communities by the Y.M.C.A. has been instrumental in
    providing positive, character building activities for children,
    teenagers and adults. Day camps are provided during the summer months,
    and back-yard sports are provided at the end of the school day during
    the school year. In addition, two 4-H Clubs serving 60 neighborhood
    children were established along with after school and community teen
    programs. Adult literacy and GED classes were made available at a
    nearby school campus. Finally, other programs have been established for
    the purpose of creating a sustainable neighborhood. These programs
    include quarterly informational forums concerning small business
    development, educational opportunities, self-help seminars, budget
    management and landlord/tenant issues.
        With respect to community-wide improvement programs, a total of
    nine neighborhood cleanups were completed this year. With the active
    involvement of the residents of the neighborhoods, the Alachua County
    Office of Codes Enforcement has been able to reduce from twenty to two
    the number of abandoned and vandalized buildings. Furthermore, a new
    Waste Collection Ordinance which was supported by the PPC permits the
    efficient and timely citation of violators.
        The sustaining factor within this Program is the formally organized
    Partners for a Productive Community Council. The Council is the guiding
    force that deals with issues and determines unmet needs. For example, a
    block captain organization was started this year with the assistance of
    the PPC Council, and the Alachua County Sheriff's Office. This group
    monitors and manages crime prevention programs block by block.
        In recognition of the numerous accomplishments described above, the
    PPC received the National Association of Counties' Achievement Award in
    1996 for distinguished and innovative contributions to improving county
    government. Additionally, the League of Women Voters presented the
    County with a similar award for outstanding community service.
        Furthermore, in December 1999 Alachua County received Official
    Recognition from the Executive Office of Weed and Seed for two of the
    neighborhoods being served by the Partners for a Productive Community
    Program. Pursuant to this recognition, these communities have been
    awarded a $175,000 Weed and Seed Grant for prevention and intervention
    strategies focusing on Cedar Ridge and Linton Oaks neighborhoods. This
    grant will further strengthen the long-term efforts to improve the
    quality of life in these neighborhoods.
        As noted above, the federal funding requested will also be used to
    expand the successful Partners Initiative into the rural community of
    Archer, which is located in the southwestern portion of Alachua County.
    Archer and the rural areas surrounding it have a population of 6,348,
    of which 16 percent fall below the poverty level. While the City of
    Archer has one elementary school, emergency rescue, fire and police
    services are contracted from Gainesville/Alachua County. There are also
    two public housing communities, and a small obsolete community center
    which is used as a congregate meal site for senior citizens.
    Consequently, many of Archer's residents travel to Gainesville for
    employment, social services, recreational activities, adult and
    continuing education and health care.
        Recently, the University of Florida, School of Nursing received
    $200,000 from the Florida Legislature to provide primary health care
    through a clinic based in Archer. Presently, this clinic is on the
    State Department of Health's list to be eliminated due to the limited
    area that it serves. Should this occur, there will be a need for
    additional funds to meet the health care needs in this area. Thus, a
    portion of the federal funding in this request could be channeled
    through the Alachua County Health Department in our continuing effort
    to develop partnerships, maximize resources and expand services to the
    citizens of Alachua County through our rural service initiative.
        Employment opportunities, recreation for teens and outreach social
    services continue to be a challenge for the community of Archer.
    According to the Alachua County Sheriff's Office, Archer's crime rate
    is disproportionately high for a community its size. In 2000, the
    Alachua County Sheriff's Office received 2,657 calls for service. Of
    the dispatched calls, 30 were assaults and batteries, and 5 were for
    sexual battery. The largest number of dispatched calls (869) concerned
    burglary and theft.
        In conclusion, Alachua County is requesting $2.3 million in federal
    funding to continue its highly successful and award winning
    neighborhood revitalization programs; and to expand these successful
    model programs to other neighborhoods, including the City of Archer,
    Florida.
     comprehensive management of drug involved offenders initiative ($2.7
                         million in funding requested)
        Prior to building additional jail space at great expense to the
    taxpayers of Alachua County, the County would like to fully explore all
    possible alternatives and programs. A one month ``snapshot'' of
    individuals arrested in 1998 dramatically showed that 36 percent of the
    231 felony defendants who were not released at first appearance were in
    custody for drug related charges. Most often, these offenders do not
    receive treatment, serve three to six months in jail, and are released
    only to be rearrested for new drug related offenses, becoming
    ``frequent flyers'' through a revolving jail door.
        A comprehensive plan to manage substance-involved offenders is an
    innovative approach that could prove to be an effective keystone to
    alleviate jail overcrowding by reducing recidivism rates and the
    incidence of drug-related crime. Professionals estimate that 50 percent
    to 80 percent of offenders have substance abuse problems. In Alachua
    County, the population of repeat offenders charged with drug
    possession, sales of small amounts of drugs, or property crimes that
    support addiction contributes significantly to the jail population. In
    fiscal year 1999, 407 individuals were sentenced to drug offender
    probation supervised by the Florida Department of Corrections. Because
    adequate treatment resources are not available, more than 50 percent of
    these individuals are expected to fail on probation, with subsequent
    incarceration in the Alachua County Jail.
        Over the past four years, Alachua County has expended an average of
    $2.9 million each year on alternatives to jail. Almost $1.7 million of
    this $11.6 million total has been invested in substance abuse treatment
    programs for offenders. In fiscal year 2002, the annual investment in
    alternatives will increase to more than $3.7 million, with
    approximately $700,000 earmarked for substance abuse treatment
    programs.
        While considerable resources have been expended on alternatives,
    current treatment resources are inadequate to meet the needs of
    addicted offenders. Additionally, funds are not available to conduct
    the research required to establish the validity of this paradigm as a
    model approach. This demonstration project includes a cost-benefit
    analysis which compares the long-term benefit of a comprehensive
    treatment model versus an incarceration/incapacitation model. Other
    benefits of this demonstration project are discussed below.
        Alachua County is a medium-sized community of 210,000 residents,
    containing both rural and urban areas similar to many other communities
    across the country. The University of Florida is located in the
    community and has served as a partner in evaluating the success of
    other programs. The impact for the entire region is considerable since
    the County serves as the regional center for much of north Florida's
    medical care and criminal justice services.
        Alachua County has many advantages which make it an ideal site for
    this demonstration program. The County has long served as a model and a
    resource for criminal justice alternative programs in the State of
    Florida. Many Florida pretrial release and alternative sentencing
    program officials consulted with Alachua County's Court Services
    Department as they developed similar services for their counties. The
    Alachua County Drug Court was one of the first 25 Drug Courts in the
    nation and has also served as a model for other Florida Drug Courts.
    Court Services Department staff are active in statewide organizations
    that provide a network to exchange information and share innovations.
    Alachua County was also recognized as a leader by the Florida State
    Legislature's Advisory Council on Intergovernmental Affairs in its 1993
    report, Intergovernmental Relations in Local Jail Finance and
    Management in Florida--A Comprehensive Report. Further, the community
    linkages in Alachua County and the array of programs provided under one
    umbrella in the Alachua County Court Services Department provide a
    unique opportunity to demonstrate the impact of a comprehensive effort.
        Alachua County has supported innovative alternative methods of
    managing offenders for more than 25 years. Alachua County funds the
    Court Services Department which comprises a comprehensive array of
    alternatives including: pretrial services, county probation, community
    service, day reporting, drug court, a work release facility and a
    residential treatment program for drug addicts.
        In fiscal year 2000, these programs completed 8,028 pre-trial
    release investigations, monitored 969 defendants on pretrial release,
    supervised 1,020 probationers and coordinated more than 4,400 cases
    where community service work was required by the Court. This year, in
    addition to the above services, the Drug Court Program will treat and
    monitor up to 120 addicted offenders per day and the Work Release
    Program will house 60 sentenced or pretrial residents per day.
    Metamorphosis, the County's residential treatment program, will serve
    17 addicted clients each day in a therapeutic community with referrals
    coming from both the community and the criminal justice system. The
    County's newest program, Day Reporting, will offer each day intensive
    supervision and a variety of rehabilitative services for up to 60
    multi-problem pretrial defendants and sentenced offenders.
        A coordinated continuum of services targeting substance abusing
    offenders across the criminal justice spectrum would further reduce the
    incidence of drug-related crime throughout the County and allow costly,
    high-security jail beds to be reserved for dangerous and high-risk
    offenders.
        The program will include continuing judicial supervision of
    nonviolent offenders with substance abuse problems and administration
    of sanctions and services including: (1) mandatory drug testing during
    any period of supervised release or probation; (2) substance abuse
    treatment; (3) probation or supervised release which could include
    prosecution, confinement or incarceration for noncompliance with the
    program's requirements; and (4) offender management and aftercare
    services to prevent relapses, such as vocational job training, job
    placement and housing placement.
        The County has an existing array of programs which would serve as
    the framework of a comprehensive system. There is strong support for
    alternative programs within the judiciary and from other local criminal
    justice officials. The County also has a long-standing history of
    cooperation among agencies. The expected benefits are national, and
    could hopefully be replicated at reasonable cost.
                   concluding comments for written testimony
        The two initiatives described above represent well-conceived
    programs that address the social, physical and economic needs of the
    citizens of Alachua County. Furthermore, these programs demonstrate the
    County's continuing commitment to projects and initiatives that
    emphasize a balance between environmental protection, economic
    development and social equity for all of the residents of the County.
    Therefore, we hope that the Subcommittee will find these two critically
    important projects worthy of your support. Thank you for your
    consideration.
                                     ______

            Prepared Statement of the Center for Marine Conservation

        The Center for Marine Conservation (CMC) is pleased to share its
    views regarding the programs in the Department of State's and the
    National Oceanic and Atmospheric Administration's (NOAA) budget that
    affect marine resources, and requests that this statement be included
    in the hearing record for the fiscal year 2002 Commerce, Justice,
    State, and the Judiciary appropriations bill.
        Through science-based advocacy, research, and public education, CMC
    informs, inspires, and empowers people to protect ocean ecosystems and
    conserve the global abundance and diversity of marine wildlife. CMC is
    the largest and oldest nonprofit conservation organization dedicated
    solely to protecting the marine environment. Headquartered in
    Washington DC, CMC has regional offices in Alaska, California, Florida,
    and Maine.
        We greatly appreciate the funding this Committee has provided for
    marine conservation over the last several years. We are particularly
    grateful for last year's significant increases for ocean and coastal
    resource protection.
                              department of state
        Implementation of the Inter-American Convention for the Protection
    of Sea Turtles (IAC).--The IAC is the first international treaty
    dedicated to sea turtle protection and was ratified by the United
    States on October 10, 2000. The treaty has also been signed by Brazil,
    Costa Rica, Ecuador, Honduras, Mexico, the Netherlands and goes into
    effect on May 2, 2001. CMC respectfully request $100,000 (within the
    International Fisheries Commission program account) in fiscal year 2002
    for the State Department to assist in the establishment of an
    independent Secretariat and in hosting the first meeting, thereby
    preserving the leadership of the United States on this treaty.
                national oceanic and atmospheric administration
        Commission on Ocean Policy.--The Oceans Act of 2000 was passed
    unanimously by both chambers of Congress and became Public Law 106-256
    on August 7, 2000. The act establishes a 16 member Commission on Ocean
    Policy to assess and make recommendations for a national ocean policy
    to Congress and the Administration. With the many threats facing our
    oceans, such as overfishing, pollution, and the loss of habitat, CMC
    respectfully requests $1.5 million in fiscal year 2002 so that this
    commission will have the resources necessary to help shape future ocean
    policy.
        Coral Reef Activities.--CMC thanks the Committee for its support of
    $27 million for coral reef conservation in fiscal year 2001 and
    respectfully requests that the committee support the Administration's
    $27.7 million request in fiscal year 2002. This funding will allow NOAA
    to continue implementing the priorities of the U.S. Coral Reef Task
    Force, a successful cross-cutting interagency partnership, and to work
    with state, territorial, and local partners to conduct important coral
    reef research and monitoring.
                             national ocean service
        National Marine Sanctuary Program.--We respectfully request the
    Committee to provide the $52 million requested by the Administration,
    ($36 million for operations, $16 for construction) for this important
    program. Often referred to as America's ``ocean parks'', the 13
    sanctuaries around the country encompass almost 18,000 square miles of
    the nation's most significant marine resources. This funding is
    critical to provide: core staffing for individual sanctuaries, visitor
    and interpretive facilities for public education and enjoyment, basic
    conservation, research, and education programs, and review and updating
    of sanctuary management plans as required by law.
        Marine Protected Areas Centers.--We respectfully request $5 million
    in fiscal year 2002 for marine protected areas (MPAs), $2 million above
    the Administration's request. This will allow NOAA to work with federal
    and state agencies as well as other partners to assess how to best use
    marine protected areas to better manage the nation's valuable marine
    resources (e.g., fish), provide recreational opportunities, and protect
    marine habitats and biodiversity. This funding would be used to
    complete the first ever comprehensive inventory of the nation's MPAs
    and to support critically needed new research on how to design and
    implement more effective MPAs.
        Nonpoint Source Pollution.--Nonpoint source pollution, or polluted
    runoff, is the nation's largest source of water pollution. Last year
    there were over 6,000 beach closings and advisories at U.S. beaches,
    six million square acres of shellfish beds were closed or restricted,
    and a 7,000 square mile ``Dead Zone'' formed in the Gulf of Mexico. We
    applaud the Committee for providing $10 million in fiscal year 2001 to
    help states implement approved portions of their Coastal Nonpoint
    Pollution Control Programs. We respectfully request $31 million in
    fiscal year 2002, $6 million for coastal states and territories to
    complete their programs and an additional $25 million for states and
    territories with approved or ``conditionally approved'' programs to
    begin implementation. This represents a $21 million increase above the
    President's request.
                       national marine fisheries service
        Atlantic Coast Cooperative Statistics Program.--CMC strongly
    supports the Atlantic Coast Cooperative Statistics Program and greatly
    appreciates the committee's support of $1.5 million in fiscal year
    2001. Created in 1995, this cooperative state and federal fisheries
    data collection program coordinates marine fisheries statistics. This
    program is unique in that it encompasses all marine fisheries sectors
    on the Atlantic Coast including recreational anglers, charter and
    headboat operators, commercial fishermen and seafood processors/
    dealers. We respectfully request $2.5 million in fiscal year 2002, $1
    million above the Administration's request, so that this program can be
    expanded and fully implemented along the East Coast, thereby helping to
    ensure that data collection methods are more consistent and reliable.
        Observers.--Reliable, objective information about how many fish are
    being caught, directly and as bycatch, is crucial to responsible
    management of our fish populations. Observers are a key means of
    collecting such information, yet current observer coverage is sorely
    lacking, and should be dramatically increased. CMC respectfully
    requests $25 million for a National Observer Program in fiscal year
    2002, $12.4 million above the Administration's request, and includes an
    additional $5 million to expand the West Coast Observer program. This
    increase would give managers a better sense of exactly how much fish is
    caught, directly and as bycatch, thereby improving management of our
    fish populations.
        South Florida Ecosystem Restoration.--The South Florida Ecosystem
    Restoration is an integrated effort among federal, state, tribal and
    non-governmental partners to halt the degradation of the South Florida
    Ecosystem and the Everglades. CMC respectfully requests that the
    Committee fully fund NOAA's portion of this vital initiative in fiscal
    year 2002, including $1.9 million requested in NMFS's budget for
    critical fisheries research and monitoring activities.
        Stock Assessments.--The status of more than 70 percent of the
    species managed under the Magnuson-Stevens Act is unknown due in large
    part to lack of funding for basic research and stock assessment. It is
    essential that we develop a better understanding of the status of our
    fish populations. The National Marine Fisheries Service, even with the
    President's requested increase of $13.3 million, would still have a
    deficit of 1,700 research days at sea to fulfill their stock assessment
    duties. CMC respectfully requests a $26.6 million increase above fiscal
    year 2001 for stock assessments, including the $1.0 million for marine
    mammal studies requested by the Administration. An additional $3.0
    million is needed in fiscal year 2002 to continue shipboard surveys in
    the Eastern Tropical Pacific tuna-dolphin fishery.
        Essential Fish Habitat.--Protecting essential fish habitat is key
    to ensuring healthy fish populations in the future. Given the need to
    better understand the impacts of fishing and other activities on these
    habitats, and the need to more fully comply with the Sustainable
    Fisheries Act requirement to minimize impacts to those habitats, we
    believe that increased funding above the President's request of $2.5
    million is crucial. In particular, additional monies are needed to
    analyze and minimize the impacts of fishing activities on these areas.
    Adequate funding for essential fish habitat is one of CMC's highest
    funding priorities for NMFS. We respectfully request that the committee
    appropriate $12.5 million to this effort in fiscal year 2002.
        Enforcement and Surveillance.--Enforcement of our fishery
    management laws has been woefully under funded for years. According to
    NMFS, there are currently approximately 150 enforcement agents, each
    responsible for nearly 1200 miles of coastline and 29,000 square miles
    of our Exclusive Economic Zone. CMC respectfully requests a base of
    $46.9 million, an additional $7 million above the Administration's
    request in fiscal year 2002, to hire more officers to address this
    chronic shortfall. These funds would also allow for strengthening of
    alternative enforcement programs and enhancement of state and local
    partnerships.
        In addition, CMC respectfully request an additional $12.4 million,
    $5 million above the Administration's request, for expanding the Vessel
    Monitoring System (VMS) program in fiscal year 2002. VMS is a
    satellite-based fishery enforcement system which has the ability to
    provide real time catch reporting throughout a number of different
    fisheries. This increase would allow for establishment and
    implementation of VMS systems as well as the placing of VMS
    transponders on a vast majority of the estimated 10,000 boats in the
    U.S. commercial fishing fleet. VMS programs enhance data collection and
    safety at sea. They also can be beneficial to fisherman by allowing
    them to fish right up until a quota is reached. Finally, with VMS
    systems, officials can tell when a fishing vessel is fishing in closed
    areas, or is fishing beyond the end of a regulated fishing season.
        Regional Fishery Management Councils.--CMC recommends $17.6 million
    in fiscal year 2002 for regional fishery management councils, $2
    million above the Administration's request. This $2 million increase is
    necessary to help the councils carry out their responsibilities under
    the Magnuson-Stevens Act, including holding council advisory meetings,
    some of which have recently been canceled due to lack of funding.
        Resource Information.--Hawaiian monk seals are the most endangered
    pinnipeds in the United States. We must commit the necessary funds to
    ensure that projects such as health assessments, marine debris
    assessments and removals, and habitat and foraging studies go forward.
    We respectfully request that the committee fund this line item at $1.5
    million in fiscal year 2002.
        Endangered Species Act Recovery Plans.--Right whale--With only 300
    North Atlantic Right Whales remaining, and the species' continued
    existence threatened by entanglement in fishing gear and collisions
    with vessels, additional funds are needed to continue research to
    improve our understanding of right whales and for the development of
    improved fishing technologies to reduce entanglements. We thank the
    committee for providing $5 million in fiscal year 2001 and urge the
    committee to support the Administration's request of $7 million in
    fiscal year 2002 for Right Whales.
        Pacific Highly Migratory Species.--We support the Administration's
    request of $1 million for stock assessments and biological studies for
    Pacific highly migratory species, including sharks. In addition, we
    respectfully request adequate funding for collaborative multi-regional
    biological research for effective management of highly migratory fish,
    including vulnerable sharks. This effort should include the Center for
    Shark Research, universities, state agencies, and other qualified
    nonprofit organizations.
        Marine Mammal Protection Act.--The President's request for $8.125
    million for Marine Mammal Protection Act (MMPA) implementation is
    woefully inadequate. Lack of funding has been one of the primary
    reasons for NMFS's failure to effectively implement the MMPA. We
    respectfully request an appropriation of $38 million in fiscal year
    2002, the amount authorized under the MMPA. This increase is necessary
    to design and implement effective fishery management plans that will
    not endanger marine mammals, conduct more and better research on
    population trends, demographics, health and genetic distinctness, and
    to carry out education and enforcement programs. These funds would also
    allow for increased observer coverage and the co-operative development
    of strategies to reduce entanglements resulting from active or derelict
    fishing gear and other forms of marine debris. It would also allow
    health assessment and research into the causes of strandings and die-
    offs as well as identification of mitigation measures to prevent such
    deaths in the future.
        Marine Mammal Commission.--CMC respectfully requests that the
    Committee to support the Marine Mammal Commission at its authorized
    level of $1.75 million in fiscal year 2002.
    Oceanic and Atmospheric Research
        Ocean Exploration.--CMC appreciates this committee's support of $4
    million in fiscal year 2001 for Ocean Exploration and respectfully
    requests $25 million in fiscal year 2002. This $11 million increase
    above the President's request would allow the United States to begin
    implementing the first comprehensive strategy to explore the oceans, as
    recommended by U.S. panel on Ocean Exploration, and to improve outreach
    and education activities.
        Thank you for your consideration of these programs that are of the
    utmost importance to the stewardship of the nation's living marine
    resources. We greatly appreciate your support for these programs in the
    past and look forward to continued, responsible funding for these
    programs in fiscal year 2002.
                                     ______

             Prepared Statement of the City of Miami Beach, Florida

        On behalf of the City of Miami Beach, Florida, I appreciate the
    opportunity to submit this written testimony to you on an extremely
    important economic development initiative, the rehabilitation of a
    large downtown theater to serve as a cultural and community center. The
    City is seeking $5 million in fiscal year 2002 appropriations for the
    acquisition and restoration of the Byron Carlyle Theater through the
    Department of Commerce, Economic Development Administration.
                       byron carlyle theater restoration
        The City of Miami Beach wishes to pursue direct funding for the
    acquisition and redevelopment of the Byron Carlyle Theater. The
    Facility will serve as a venue for cultural and non-profit
    institutions, functionally interacting with the North Shore Youth
    Center. The two primary objectives of this facility are: (1) to use
    cultural institutions as a catalyst for the revitalization of the North
    Beach area, and (2), to provide a facility that can house those
    organizations that are being priced out the their current locations.
    The City is seeking $5 million towards this project.
        The Byron Carlyle Theater is a 7-screen movie theater that is
    located in the central business district of Miami Beach's North Beach
    area of. The theater was closed by Regal Cinemas in 1999, and has been
    vacant ever since, creating a void in what once was a thriving downtown
    neighborhood. The City of Miami Beach has begun the implementation of a
    strategic plan for the revitalization of the North Beach area, which
    includes approximately $124 million in capital improvement projects
    that will be implemented during the next 6 years. The redevelopment of
    vacant buildings such as the theater is crucial to the economic and
    business development components of the North Beach Strategic Plan.
    However, due to the unique layout and structural nature of older movie
    theaters such as the Byron Carlyle Theater, redevelopment options are
    limited and expensive.
        There are two reasons that Miami Beach needs the Byron Carlyle
    Theater as a multi-purpose cultural facility. First, the redevelopment
    of this theater is an integral component of the Strategic Plan for the
    economic revitalization of the North Beach area of Miami Beach. While
    other areas of Miami Beach have enjoyed tremendous economic success
    over the last 10 years, the North Beach area has lagged in its growth
    and continues to evidence a concentration of low income households and
    a lack of private sector investment. The emergence of cultural
    institutions during the beginnings of the economic revitalization of
    South Beach's Art Deco District directly contributed to the area's
    continued success. Secondly, the success that cultural organizations
    helped create in South Beach is also a reason for the creation of a
    cultural facility in North Beach. As South Beach boomed, local cultural
    institutions became self sufficient and successful, area market trends
    began to improve and property values appreciated significantly. In
    1993, the primary cultural area in South Beach was on Lincoln Road,
    where rental rates averaged $12 per square foot. In 2000, rental rates
    reached $75 per square foot, and many small businesses and cultural
    organizations were forced to either relocate or dissolve. Additionally,
    many cultural organizations currently housed in City-owned facilities
    will soon have to relocate as the City expands to meet the ever-
    increasing service levels expected by the citizens. A central facility
    that accomplishes both goals is critical to the economic revitalization
    of the North Beach neighborhoods.
        The Acquisition and Renovation of the Byron Carlyle will also help
    develop the entire City of Miami Beach into a world-renowned center for
    the creation and consumption of culture. Miami Beach is home to many
    internationally acclaimed cultural organizations, such as the New World
    Symphony, the Miami City Ballet, and the Bass Museum. These
    organizations, however, are located in a small concentrated area of
    South Beach. The City also has over 75 smaller cultural groups that are
    the true cultural heart of Miami Beach. Organizations such as the
    Concert Association of Florida, Ballet Flamenco La Rosa, and the
    Performing Arts Network continue to struggle for their economic
    survival. The ability to provide a facility that allows these groups to
    remain in Miami Beach will provide a venue where many emerging and
    small organizations can continue to grow and prosper and at the same
    time provide a catalytic cultural component to the revitalization
    effort in North Beach.
        In 1999, in an economic impact report to the City of Miami Beach's
    Mayor's Economic Council, Florida International University identified
    that investment in the cultural arts has the highest economic output
    multiplier of all local industries. The challenge for cities such as
    Miami Beach, however, is, providing the level of Cultural Arts
    investment that is required to generate this ``biggest bang for the
    buck.''
        The City of Miami Beach estimates that the cost to acquire and
    rehabilitate the Byron Carlyle is $7.2 million. The City currently has
    approximately $2.2 million for this project, which will include the
    $1.7 million purchase price. The City has also identified funding
    sources that will be committed to the annual operation of the facility
    once it opens. The City of Miami Beach is requesting $5 million in
    federal funding for the renovation of this facility.
        Federal support is critical to the success of this economic
    development project. It is our hope that the Subcommittee will give our
    request every consideration.
                                     ______

                 Prepared Statement of Florida State University
        Mr. Chairman, I would like to thank you and the Members of the
    Subcommittee for this opportunity to present testimony.
        I would like to discuss the funding for the maintenance of ongoing
    programs and additional resources for NOAA and its extramural research
    collaborators to advance the science and accuracy of climate and
    weather forecasting.
        First, let me stress the importance of allocating maximum support
    for the Office of Global Programs, funded at a minimum at the fiscal
    year 2001 level of $68.095 million. This Committee has supported full
    funding of the budget request of the OGP through the past several
    appropriations acts. All of NOAA's intramural and extramural research
    initiatives have been determined and planned by nonpartisan, scientific
    experts whose goals have been to improve the science, accuracy and
    lead-time of long range climate forecasts, and to improve regional
    warning systems through down-scale modeling. The importance of
    maintaining and sustaining this comprehensive approach to understanding
    our climate system will permit improved and longer lead-time
    forecasting. This allows for better planning for the effects of climate
    forced events, resulting in saved lives, minimized property losses, and
    improved planning in resource allocation and crop planting.
        Next, I request the Committee's consideration of apportioning $20
    million for a Supercomputer to be shared by universities and
    institutions for high-end climate modeling and research. Current
    climate modeling in the United States is limited by computer capacity.
    The House Science Committee held a hearing recently on Climate
    Forecasting: The State of the Science. When queried by Committee
    Members, the independent scientific experts who appeared as witnesses
    stated unanimously that the greatest need for United States advancement
    in the climate modeling and research fields is the need for
    Supercomputing capacity among universities and institutions for high-
    end use.
        Climatologists in the United States have now reached the capacity
    of currently utilized computer systems in the high-end tasks associated
    with water and atmospheric modeling. The ability to process massive
    amounts of data can be only achieved through the acquisition of vector
    analysis Supercomputers. Vector analysis computers were not available
    to U.S. Government-funded institutions until recently. The current U.S.
    approach, using MPP technology, cannot process the whole of computer
    modeling tasks associated with water and atmospheric data on a global
    scale. Scientists acknowledge that the facility must be located apart
    and distinctly separate from NOAA's ongoing computer functions, due to
    the need for a dedicated Supercomputer specifically configured for
    high-end climate and modeling and research. A shared computer with NOAA
    for NOAA's use, whether part-time or back up, does not provide the
    capability and sustained processing power needed for the demands
    associated with high-end climate modeling. This request for $20 million
    in fiscal year 2002 is for a computer to be competitively bid and
    awarded, and for institutions, like Florida State University, to have
    access for sharing the use of Supercomputing capacity.
        Finally, I request that consideration be given to an allocation of
    $20 million for a Supercomputer for NOAA to be used as a backup for
    National Weather Service and other NOAA forecasting purposes, including
    research. There is widespread recognition among the extramural research
    community for the necessity of improved capacity and backup among
    computers for the National Weather Service. There is also a recognized
    and documented need in NOAA for a backup computer for the NWS. Last
    year's shutdown of NOAA's main computer, and subsequent loss of
    forecasting ability, left the NWS unable to provide the services upon
    which U.S. citizens, state and local governments, and private industry
    have come to rely. The necessity of a backup is clear, and in times of
    non-use as a backup, NOAA's internal research demands for this capacity
    exist. This statement concerning NOAA's needs represents consensus
    among the extramural community for additional resources and
    Supercomputer capacity for NOAA and the NWS.
        Thank you for this opportunity to present and articulate the needs
    and request for climate modeling and research in the United States.
                                     ______

               Prepared Statement of the National Audubon Society

        On Behalf of the National Audubon Society and our one million
    members and supporters, we appreciate the opportunity to submit
    testimony regarding funding priorities for the fiscal year 2002 budget
    of the National Oceanic and Atmospheric Administration and the National
    Marine Fisheries Service. The mission of the National Audubon Society
    is to conserve and restore natural ecosystems, focusing on birds and
    other wildlife and their habitat for the benefit of humanity and the
    earth's biological diversity.
        To adequately fulfill their mandates the National Marine Fisheries
    Service (NMFS) and the National Ocean Service (NOS) within the
    Department of Commerce are in need of additional monies over those
    provided in fiscal year 2001. Below is a detailed list of what the
    National Audubon Society sees as critical funding priorities within
    these agencies accompanied by minimum appropriations levels.
                   national marine fisheries services (nmfs)
        Mandates derived from passage of the Sustainable Fisheries Act
    (SFA) have significantly increased the commitments of NMFS since 1996.
    Full implementation of NMFS's additional commitments, including
    research programs, the development and implementation of comprehensive
    fishery management plans, and monitoring programs, requires substantial
    additional fiscal resources. While the President's proposed budget
    provides increases for a number of important programs, resources fully
    adequate to NMFS's obligations have yet to be appropriated. We urge the
    Committee to provide additional funds for the programs detailed below
    for fiscal year 2002.
    Resource Information
        Audubon supports the proposed $4.196 million dollar increase to the
    resource information base. As detailed below, we are encouraged and
    enthusiastic regarding increases in a number of specific line items,
    however, we are concerned that some increases may fall short of what is
    necessary.
      --Expand Annual Stock Assessments.--The administration has requested
            a total of $15 million for expanding annual stock assessments,
            which represents an increase of $13.3 million. Audubon is
            supportive of this increase, however, we note that this level
            of funding will eliminate just one third (829) of the deficit
            of 2,564 research days identified in NMFS' Stock Assessments
            Improvement Plan as necessary for adequate stock assessment
            coverage. At a time when the status of nearly half (43 percent)
            of all assessed fish species are considered overfished, our
            ignorance of the status of 78 percent of our fish stocks in
            aggregate is simply unacceptable. To close the tremendous gap
            in knowledge, Audubon proposes an increase of $19 million over
            2001 funding levels which would reduce the research days
            deficit by one half.
      --Fishery Observers.--Audubon believes that the administration's
            request of and additional $4 million for fishery observers is a
            step in the right direction, but is insufficient. Observer
            coverage levels in some fisheries, such as the Atlantic pelagic
            longline fishery, have been below levels mandated by
            international agreements and biological opinions issued under
            the authority of the Endangered Species Act for multiple
            consecutive years because of fiscal constraints. To ensure that
            sampling occurs annually at a statistically reliable level of
            coverage within all statistical areas fished, Congress must
            provide additional money to NMFS for fishery observers. Audubon
            proposes an increase of $16.4 million above fiscal year 2001
            funding levels for this purpose.
      --Pacific Highly Migratory Species Research.--Audubon is supportive
            of the administration's request of $1 million for Pacific
            highly migratory species research, but believes this level of
            funding is inadequate. Funding for stock assessments and
            biological studies, as well as improving bycatch mitigation
            techniques for these fisheries are critical for the long-term
            health of the fishery. Of vital importance to improving
            management of these species in both the near and long-term is
            the completion of the Pacific Fishery Management Council's
            Highly Migratory Species Fishery Management Plan. To guarantee
            the timely completion of this plan, Audubon proposes that
            appropriations for Pacific Highly Migratory species be raised
            to $1.5 million with $500,000 of these appropriations
            specifically dedicated to completion of the Pacific Fishery
            Management Council's plan.
      --Bluefin Tuna.--Audubon believes the Administration's request of
            $600,000 for bluefin tuna research is below the level needed to
            fund appropriate scientific research. Audubon strongly urges
            the Committee to appropriate $1 million and ensure that these
            research dollars be evenly distributed between Stanford
            University and the New England Aquarium. In fiscal year 2001
            all federal bluefin tuna research dollars were allocated to the
            New England Aquarium. The Stanford University research team has
            traditionally lead the field in Atlantic bluefin tuna research
            and we believe that their significant expertise should be
            engaged on this issue.
      --Essential Fisheries Habitat.--Essential fish habitats (EFH) are
            those waters and substrate on which fish depend. These habitats
            are currently being damaged from both land based activities and
            destructive fishing practices. While the Sustainable Fisheries
            Act of 1996 gave NMFS a clear mandate to identify and conserve
            essential fish habitat, little has been done. Audubon supports
            an increase of $12.8 million over fiscal year 2001 funding
            levels. This increase in funding would allow NMFS to gain the
            information necessary to further refine designations of EFH and
            take action to conserve EFH, including measures to minimize the
            adverse impacts of fishing gear on EFH.
      --Cooperative Research.--Audubon supports the administration's $6
            million request for cooperative fishery research, which
            represents an increase of $500,000 over the fiscal year 2001
            enacted level. These additional monies will provide for the
            expansion of cooperative research activities in the Southeast
            region and allow for the expertise of fishermen to be utilized
            in conjunction with that of NMFS in the development of data
            collection and other programs. Audubon further supports the
            continuation of shark research funding to Mote Marine
            Laboratory at the proposed $150,000 level.
                     conservation and management operations
        Audubon is encouraged by and supportive of the proposed $2.033
    million increase in funding for the fisheries management programs base.
      --Regional Councils.--The administration has requested a total of
            $15.6 million for the regional fishery management councils,
            which represents an increase of $2.5 million above the fiscal
            year 2001 enacted level. Audubon is supportive of the proposed
            increase, however this level of appropriations still falls
            short of what is needed to support the increased workload of
            the eight regional councils. Audubon proposes an increase in
            appropriations to $19.05 million as per the aggregate request
            of the eight regional councils. Audubon believes that this
            higher level more accurately reflects the appropriations
            necessary to fully execute their responsibilities.
      --Atlantic Salmon.--Audubon supports the administration's request of
            $3.5 million for Atlantic salmon, which represents an increase
            of $1.5 million over the fiscal year 2001 enacted level. These
            monies will contribute to conserving and restoring populations
            of endangered Atlantic salmon in the Gulf of Maine Distinct
            population segment and their habitat. These appropriations, in
            conjunction with appropriations to the National Fish and
            Wildlife Service are critical for effecting a recovery of this
            highly endangered species.
      --Enforcement and Surveillance.--While Audubon is supportive of the
            administration's $47.3 million request for enforcement and
            surveillance activities, which provides a $10 million increase
            for enforcement activities over fiscal year 2001 levels, we
            believe it falls short of what is needed to allow for effective
            enforcement of current fisheries regulations. We are pleased to
            see the proposed increase of $6.1 million for the vessel
            monitoring systems (VMS) over the fiscal year 2001 enacted
            levels and the implied commitment to effective fishery
            monitoring. Nevertheless, this funding level is far below what
            is needed to ensure coverage for noticeable portion of the
            estimated 10,000 U.S. commercial fishing vessels. Audubon
            proposes an aggregate request of $11.1 million over fiscal year
            2001 enacted levels for VMS, which represents an increase of
            $9.8 million. This higher amount would support VMS coverage of
            roughly 11 percent of this nation's commercial fishing fleet.
            Given the increased use of large-scale area closures and the
            difficulty in enforcing the use of these vital management
            tools, VMS is an indispensable enforcement tool. Enforcement
            alternatives to VMS would be immensely more costly and include
            100 percent observer coverage in some fisheries and the
            procurement of significant numbers of additional enforcement
            personnel, aircraft and ships to patrol area closures. VMS also
            provides the added benefit of improving fisheries management by
            providing refined real-time data regarding spatial and temporal
            distribution of fishing effort. Audubon is further supportive
            of the proposed $3.9 million increase over fiscal year 2001
            enacted levels to expand and modernize the enforcement and
            surveillance base.
      --Sea Turtles.--Audubon supports the Administration's request of $6.3
            million for marine sea turtle activities, which represents an
            increase of $3 million over the fiscal year 2001 enacted level.
            Given that the two most recent biological opinions (May 2000,
            April 2001) regarding the Atlantic highly migratory species
            fishery determined that continuation of the Atlantic pelagic
            longline fishery, as currently prosecuted, constitutes a threat
            to the continued existence to loggerhead and leatherback sea
            turtles, Audubon would like to see a significant portion of
            these new dollars dedicated to reducing fishery interactions
            with sea turtles. This recommendation is further bolstered by
            similar turtle interaction problems affecting pelagic longline
            fisheries in the central Pacific, which recently compelled a
            judge to drastically curtail longline fishing in that region.
      --Fisheries Oceanography.--Audubon supports the Administrations
            request of $2 million for fisheries oceanography. As increasing
            pressure is brought to bear on fish stocks it is critical to
            develop new tools to further our understanding of how long-term
            environmental factors affect fish stocks.
                        coastal conservation activities
        Coral Reef Activities.--Audubon supports the administration's $27.7
    million aggregate request for coral reef activities. This amount
    represents status quo for the National Ocean Service's Coral Reef
    Institutes Program ($16 million) and the National Marine Fisheries
    Service's Coral Reef Program ($11 million), while providing a modest
    increase of $700,000 above the fiscal year 2001 enacted levels for
    Coral Reef Monitoring through the National Environmental Satellite,
    Data and Information Service. The fragile nature of coral reefs and
    their function as ``hotspots'' of biodiversity demand that we as a
    nation provide adequate funding to properly manage these critical
    habitats.
                         national oceans service (nos)
        Marine Sanctuary Program.--Audubon supports the Administration's
    request of $36 million for the National Marine Sanctuary program, which
    represents an increase of $3.6 million over fiscal year 2001 enacted
    levels. These new dollars, if appropriated, will allow for improved
    protection of important sanctuary resources as well as additional
    personnel and ocean research.
        Marine Protected Areas Program.--The administration has requested
    $3 million for the Marine Protected Areas (MPA) Program, which
    represents and increase of $3 million over fiscal year 2001. Audubon
    believes this amount is insufficient and proposes an additional $2
    million in funding for fiscal year 2002, for an aggregate of $5 million
    for the NOS MPA program. Preparation of a supporting framework for
    collaboration between the stakeholders, as well as execution of the
    first comprehensive inventory and assessment of the existing system of
    MPAs in U.S. waters are critical to the success of the program and
    cannot be adequately carried out without additional monies beyond those
    proposed by the Administration.
        Mr. Chairman and Members of the Committee thank you for the
    opportunity to provide testimony on Audubon's priorities for NOAA. I
    understand that it is a large agenda, but the problems facing America's
    marine resources are significant. We look forward to working with you
    to secure a legacy of living oceans for future generations.
                                     ______

         Prepared Statement of the Pacific Marine Conservation Council

        Pacific Marine Conservation Council (PMCC) appreciates this
    opportunity to share our views regarding the President's fiscal year
    2002 budget request for certain fisheries programs of the National
    Oceanic and Atmospheric Administration (NOAA).
        PMCC is a nonprofit, public benefit corporation working with
    commercial and recreational fishermen, marine scientists and
    conservationists to conserve and sustain West Coast groundfish and the
    coastal communities that depend upon them.
        The West Coast groundfish fishery is under a federal disaster
    declaration, yet we have the opportunity to revive depleted stocks and
    to ultimately enjoy sustainable and profitable harvest. The economic
    impact of this important fishery reaches far beyond the communities
    along the 1,300-mile Pacific coastline of the Lower 48. The seafood
    industry distributes the catch of our commercial fishermen throughout
    this country and to overseas markets. Recreational fishing in these
    ocean waters also drives a powerful economic engine.
        President Bush's budget provides for several well-considered and
    important investments that will enhance this nation's fisheries. For
    example, PMCC commends the intention of NOAA to expand stock
    assessments and modernize information systems.
        PMCC believes that the following modest modifications to the
    National Marine Fisheries Service: Operations, Research and Facilities
    section of the NOAA budget will improve fisheries management and
    provide long-term national benefits:
                     conservation and management operations
        Observers and Training--West Coast Observers.--We greatly
    appreciate that this Committee provided funding in the amount of $2.275
    million for the commencement of a limited West Coast observer program
    in appropriations for fiscal year 2001. The President's budget carries
    this amount forward for 2002. To fully implement this observer
    program--to collect, analyze, and use the vital biological and
    statistical data necessary to refine management--will require the
    expenditure of at least $5 million per year. The $2.275 million limited
    program will provide approximately 10 percent coverage, while engaged
    marine scientists recommend 20 percent coverage for valid statistical
    sampling in this fishery. We respectfully request that the line for
    West Coast observers be raised to $5 million for fiscal year 2002.
    (This represents an increase of $2.725 million over the President's
    request.)
                         fisheries management programs
        Regional Councils.--The President's budget includes $15.65 million
    for the eight regional fishery management councils. This is an increase
    over the fiscal year 2001 level, but still falls short of adequate
    funding for most councils to carry out their responsibilities under the
    Magnuson-Stevens Act. The Pacific Fishery Management Council, for
    example, would be funded at a level that would compromise critical work
    implementing their precedent-setting groundfish strategic plan
    ``Transition to Sustainability.'' PMCC recommends funding the regional
    councils at $17.6 million for fiscal year 2002. (This represents an
    increase of $1.95 million over the President's request.)
     state and industry assistance programs (interjurisdictional fisheries
                                    grants)
        West Coast data collection by the states.--Groundfish species do
    not respect the 3-mile state waters boundaries. They may be targeted or
    caught as by-catch in both federal and state-managed fisheries. Data
    collection by observers and by other means directed by the States
    (California, Oregon and Washington) in near-shore waters is necessary
    to augment information provided by federal programs. Much of this
    state-directed effort could utilize the services and vessels of
    fishermen based in our coastal towns. PMCC requests that this Committee
    fund these activities, to be coordinated with the National Marine
    Fisheries Service, in the initial amount of $3 million.
        Thank you for considering our recommendations as you make the
    important decisions to invest in the stewardship of America's
    fisheries.
                                     ______

              Prepared Statement of the American Chemical Society

        The American Chemical Society (ACS) would like to thank Chairman
    Judd Gregg and Ranking Member Ernest Hollings for the opportunity to
    submit testimony for the record on the Commerce, Justice, State and
    Judiciary Appropriations bill for fiscal year 2002. ACS is a non-profit
    scientific and educational organization, chartered by Congress, with
    more than 163,000 chemical scientists and engineers as members. The
    world's largest scientific society, ACS advances the chemical
    enterprise, increases public understanding of chemistry, and brings its
    expertise to bear on state and national matters.
        ACS firmly believes that advances in science and engineering have
    produced more than half of our nation's economic growth in the last 50
    years and, economists agree, these advances remain the most important
    factor in the productivity increases responsible for our growing
    economy and rising standard of living. Each field of science
    contributes to our diversity of strengths and capabilities and has
    given us the flexibility to explore new fields and apply science in
    unexpected ways. Over the last 25 years, funding for biomedical
    research has increased while federal support for most other disciplines
    has remained flat or declined. Congress took an important step in the
    right direction last year when it increased funding for scientific
    research for fiscal year 2001. To nourish the roots of innovation in
    all fields and help ensure the success of growing investments in
    biomedicine, balance must be restored to the nation's R&D portfolio
    while supporting overall growth in the nation's science and technology
    budget. This should be a top priority for Congress and the
    administration as fiscal year 2002 appropriations are considered.
         national institute of standards and technology (nist) budget
                                recommendations
        For 100 years, NIST has assisted industry and researchers by
    developing technology needed to improve product quality, modernize
    manufacturing processes, ensure product reliability, and facilitate
    product commercialization. The ACS is concerned that NIST's budget
    increases since 1995 have generally been offset by inflation and salary
    increases. As a result, some important programs, such as those
    investigating materials reliability, can not explore scientific
    opportunities due to lack of funds. The budget constraints also are
    adversely affecting NIST's ability to purchase capital equipment,
    recruit and retain staff, and respond to the rapid changes of a global
    economy. We particularly urge Congress and the administration to
    continue reinvigorating NIST's core laboratory programs given the
    quality, uniqueness, and economic importance of its work. We also
    support the goals of the Advanced Technology Program (ATP) and the
    allocation of more funds for maintenance of NIST facilities. ACS urges
    a greater than inflation funding increase for NIST in fiscal year 2002.
                     measurement and standards laboratories
        NIST laboratories' research, measurement infrastructure, and
    standards-related activities are critical to the operation and
    productivity of small and large companies across all industries, as
    well as universities, hospitals, and law enforcement agencies. The
    program provides impartial expertise, test methods, and best-in-the-
    world calibration services that maximize efficiencies, promote trade,
    and ensure confidence in the growing number of precision measurements
    needed for health, safety, defense, commerce, energy, and the
    environment.
        NIST laboratories develop universal measurement techniques and
    technologies that foster higher quality products, more reliable
    processes, fewer rejected parts, and faster product development across
    all American industries. NIST is responsive to, and works with,
    industry to identify future needs, enables the development of advanced
    technologies, and plays a vital role in promoting international
    acceptance of U.S. standards abroad. We especially support NIST
    research in nanotechnology, healthcare, and information-technology
    security.
                       advanced technology program (atp)
        ATP aims to strengthen U.S. industries' capabilities in high-risk
    technologies. As world competition grows, speed to market and an edge
    in emerging technologies are critical for the United States. ATP
    contributes to these goals and supports many small start-up firms that
    might not otherwise succeed in technology areas where venture capital
    funding is scarce. The program also provides an incentive for firms to
    perform research that has greater risks than typical industrial R&D but
    has promise for broad economic impact.
                                     ______

     Prepared Statement of the People for the Ethical Treatment of Animals

        Chairman Gregg and Members of the Subcommittee: People for the
    Ethical Treatment of Animals (PETA) is the world's largest animal
    rights organization, with more than 700,000 members. We greatly
    appreciate this opportunity to submit testimony regarding fiscal year
    2002 appropriations for the National Oceanic and Atmospheric
    Administration (NOAA). Our testimony will focus on financial aid for
    the commercial fishing industry.
        As you may know, in the summer of 2000, an emergency spending bill
    was passed which included $50 million for NOAA to help provide relief
    to the commercial fishing industry from environmental restrictions,
    overfishing, and foreign competition.
        Fish suffer greatly when caught and killed for their flesh. Whether
    caught by hook or net, fish experience fear and pain.
        We would like to request that the Subcommittee include report
    language ensuring that no NOAA funds may be used for financial aid to
    the commercial fishing industry.
    Fish feel pain
        The following is excerpted from Lord Medway's 1979 Report of the
    Panel of Enquiry Into Shooting and Angling, sponsored by the Royal
    Society for the Prevention of Cruelty to Animals:

        ``[T]he evidence suggests that all vertebrates (including fish),
    through the mediation of similar neuropharmacological processes,
    experience similar sensations to a greater or lesser degree in response
    to noxious stimuli. . . . The apparent universality throughout
    vertebrates of the neuropharmacological basis for the perception of
    painful (and pleasurable) stimuli does not permit us to agree with
    those who would recognize a difference in this function between `warm-
    blooded' and `cold-blooded' members.''

        Captain Jacques Cousteau said, ``To reassure one's conscience, it
    is said that fish do not feel pain--of course such claims are
    completely without foundation.''
    The commercial fishing industry causes immense suffering
        Trawlers drag enormous nets through the water, forcing all fish in
    their path into the closed end. For hours, the trapped fish are
    squeezed and bounced, together with any netted rocks and ocean debris.
    ``Prolonged tumbling and dragging in the net had caused the fish to rub
    against each other and file away their sharp scales,'' author William
    Warner reported of a haul he observed. ``Their flanks, in fact, were
    scraped entirely raw.''
        When hauled up from the deep, fish may undergo excruciating
    decompression. Frequently, the intense internal pressure ruptures the
    swimbladder, pops out the eyes, and pushes the esophagus and stomach
    out through the mouth.
        Smaller fish, such as flounder, who are ordinarily dumped onto
    chopped ice, usually suffocate or are crushed to death by fish who
    follow. Larger fish, such as scrod and haddock, tumble onto the deck
    and are sorted by workers who stab them with short, spiked rods called
    ``pickers.'' Next, the fish's throats and abdomens are slit, often
    while they are still alive. Meanwhile, nontarget fish (``bycatch''),
    who sometimes comprise most of the catch, are thrown overboard, often
    by pitchfork.
        On any given day, fishers may set out some 40,000 miles of
    gillnets, driftnets on the Pacific high seas, and anchored nets in
    coastal waters. Plastic, weighted gillnets hang like curtains,
    generally to a depth of 30 feet. Unable to see the netting, fish swim
    into it. Unless they are smaller than the mesh size, they get no
    further than poking their heads through. When they try to back out, the
    netting catches them by their gills or fins. Many of the fish
    suffocate; others struggle so desperately in the sharp mesh that they
    bleed to death. Because gillnets are left unmonitored, trapped fish can
    suffer for days.
        Some commercial fishers still harpoon large fish (such as
    swordfish, tuna, and sharks) or hook them individually. Large fish are
    also caught by ``long-lining,'' in which a ship unreels as much as 30
    miles of line bristling with hundreds of thousands of baited hooks.
    Fish are not the only animals harmed
        Millions of nontarget animals, including sea turtles, dolphins,
    birds, and seals, die horrible deaths in commercial fishing nets every
    year. According to the United Nations, nearly 25 percent of all marine
    life caught annually--30 million tons--is thrown back into the ocean
    dead or dying, maimed by fishing line or gillnets.
    The commercial fishing industry pollutes our oceans
        In the process of slaughtering billions of sea animals, trawlers
    also dump into the oceans 450,000 plastic containers, 52 million pounds
    of plastic packing material, and 298 million pounds of plastic fishing
    net.
                                    summary
        The commercial fishing industry kills sea animals indiscriminately,
    causes immeasurable suffering, and pollutes our oceans. These practices
    should not be subsidized with federal funds.
        Please include language in the report accompanying the fiscal year
    2002 Commerce, Justice, State, and Judiciary Appropriations bill
    stating that no NOAA funds shall be used for financial aid to the
    commercial fishing industry.
        Thank you for your consideration of our request.
                                     ______

     Prepared Statement of the United States Section of the Pacific Salmon
                                   Commission

        Mr. Chairman, my name is Roland Rousseau. I am an Alternate
    Commissioner on the Pacific Salmon Commission (PSC) and the Chair of
    the Budget Committee for the U.S. Section of the Commission. The PSC
    was established under the Pacific Salmon Treaty (Treaty) between the
    United States and Canada. A new Agreement (Agreement) was concluded in
    June of 1999 that establishes new abundance-based fishing regimes under
    the Treaty and made other improvements in the Treaty's structure. I am
    providing this statement of the fiscal year 2002 budget for Treaty
    programs recommended by the U.S. Section of the Pacific Salmon
    Commission for the Committee's use and for the record. The U.S. Section
    recommends that $7,456,000 be provided for the Pacific Salmon Treaty
    Line Item under the Information Collection and Analysis activity of the
    National Marine Fisheries Service for fiscal year 2002. Included in
    this amount is $5,612,000 for base programs required to implement the
    provisions of the Treaty and $1,844,000 to acquire the technical
    information to implement abundance based chinook salmon management
    provided for under the new Agreement. The U.S. Section recommends that
    $400,000 be provided to continue the bilateral Transboundary River
    Enhancement Program under the NMFS International Fisheries Commissions
    Line Item in fiscal year 2002. We also recommend that $2,460,000 be
    provided to the Department of State in fiscal year 2002 to fund the
    bilateral PSC staff and offices and for U.S. Section travel and
    stipends. This is an increase of $309,000 over the fiscal year 2001
    level.
        The base Treaty implementation program, which has been level funded
    at $5,587,000 for several years is requested at $5,612,000 to restore
    the fiscal year 2001 recision. This program includes a wide range of
    salmon stock assessment, fishery monitoring, and technical support
    activities for all five species of Pacific salmon in the fisheries and
    rivers from Southeast Alaska to those of Washington, Oregon, and Idaho.
    The States of Alaska, Washington, Oregon, and Idaho, and the National
    Marine Fisheries Service (NMFS), are charged with carrying out a major
    portion of the salmon fishery stock assessment and harvest management
    actions required under the Treaty. Federal funding for these activities
    is provided through the National Marine Fisheries Service on an annual
    basis. The agency projects carried out under Pacific Salmon Commission
    funding are directed toward acquiring, analyzing, and sharing the
    information required to implement the conservation and sharing
    principles of the Treaty. A wide range of programs for salmon stock
    size assessments, escapement enumeration, stock distribution, and catch
    and effort information from fisheries, are represented. The information
    from many of these programs is used directly to establish fishing
    seasons.
        In 1996, the United States adopted an Abundance-Based Approach to
    Managing Chinook Salmon Fisheries in Southeast Alaska. Under this
    approach, chinook harvest levels are based on annual estimates of
    chinook abundance. This system replaced harvest ceilings agreed to in
    1985, which did not respond to fluctuations in chinook salmon
    populations. Under the new Agreement of 1999, this abundance based
    management approach was expanded to all chinook fisheries subject to
    the Treaty. Congress appropriated $1,844,000 for fiscal year 2001 to
    provide for the collection of necessary stock assessment and fishery
    management information to implement the new approach. The funding is
    being used by Alaska, the Pacific Northwest States, and treaty tribes
    to implement abundance-based chinook salmon management coastwide under
    the new Agreement. The U.S. Section recommends level funding of
    $1,844,000 to support the implementation of abundance-based chinook
    management in fiscal year 2002.
        The United States and Canada agreed to a joint salmon enhancement
    program on the Transboundary Rivers flowing between Canada and
    Southeast Alaska in 1988. Congress has provided $400,000 annually for
    this effort through the National Marine Fisheries Service's
    International Fisheries Commission line item under the Conservation and
    Management Operations activity. The U.S. Section recommends that
    $400,000 again be provided in fiscal year 2002 for funding of this very
    successful bilateral program.
        The U.S. Section of the Pacific Salmon Commission recommends a
    Department of State funding level of $2,460,000 for Treaty
    implementation in fiscal year 2002. This is an increase of $309,000
    over the fiscal year 2001 appropriation, and is vitally needed to
    support new U.S. commitments made in the June, 1999 Agreement. This
    funding provides for the United States contribution to the bilateral
    Pacific Salmon Commission staff and offices based in Vancouver, British
    Columbia. It also provides for travel for U.S. Commissioners, panel
    members, and technical Committee members and stipends for authorized
    Commissioners and panel members. As a result of the new PSC agreement a
    new bilateral standing Committee and a new panel will start up this
    fiscal year. An increase in funding will be needed to cover the U.S.
    Section travel and salary costs associated with these new bodies.
        This concludes the Statement of the U.S. Section of the Pacific
    Salmon Commission submitted for consideration by your Committee. We
    wish to thank the Committee for the support that it has given us in the
    past.
                                     ______

                             DEPARTMENT OF JUSTICE

          Prepared Statement of the Central Piedmont Community College

        Mr. Chairman and Members of the Subcommittee, thank you for the
    opportunity to submit testimony to the hearing record regarding Central
    Piedmont Community College's (CPCC) efforts to meet a regional and
    national need for forensic technician training. First, I would like to
    thank the Subcommittee for its assistance last year resulting in
    $500,000 from the Crime Laboratory Improvement Program. This funding
    has been matched with a generous donation by the Belk Foundation plus
    local bond monies of $3.2 million for a total of $3.7 million. These
    funds together will be used to develop curricula and upgrade
    instructional technology toward our goal of establishing a National
    Academy for Forensic Computing and Investigation (NAFCI).
        We are seeking continued federal partnership assistance to fully
    implement NAFCI. A staff person from the National Institute of Justice
    recently spent a day on our campus to review our current programs and
    vision for the Academy. We are working to forge a very productive
    working partnership with the Department of Justice based upon our
    experience and the Department's expressed needs in forensic training.
        The elements that make CPCC an ideal site for such an initiative
    are as follows. CPCC is the largest institution of higher education in
    the State of North Carolina, with over 70,000 students, and is the
    leading provider of career training and re-training in the State.
    CPCC's efforts to establish a National Academy for Forensic Computing
    and Investigation came about in response to requests from North
    Carolina's law enforcement community, including the Federal Bureau of
    Investigation, as well as the Charlotte-Mecklenburg business community.
        CPCC was specifically targeted to carry out this mission by virtue
    of a thirty-year history as the leading provider for criminal justice
    training. The public safety program at CPCC has expanded quickly with
    the growth of the Charlotte-Mecklenburg region. The current program
    serves a 13-county region and offers a comprehensive range of programs
    and services, including instruction in the high demand occupational
    skills area of forensics technology. This instruction is currently
    available to a variety of law enforcement and public agency officials
    who previously would have had to travel extensively for this type of
    professional development and training.
        Citing extreme inability to find skilled workers in the field, a
    consortium of local industry leaders, including the Charlotte Chamber
    of Commerce, the Federal Bureau of Investigation, and representatives
    from the banking, insurance, law enforcement, and legal industries,
    asked CPCC's Department of Public Safety to develop a training program
    in forensic technology. These industries also seek assistance in
    retraining and upgrading skills of incumbent workers.
        The challenge is to meet not only local public agency demand for
    criminal justice training, but also the increasing need from the
    private sector which is now requesting specialized skills training in
    criminal justice topics such as forensics computer technology. There
    are currently no forensic science degrees offered at the graduate or
    undergraduate levels at any of North Carolina's colleges and
    universities.
        The need for forensics training can also be translated to the
    national level. According to the National Institute of Justice (1999),
    49 percent of the cases prosecuted in the United States were successful
    solely because of the forensic sciences. Unfortunately, law
    enforcement, social services, and other governmental agencies, along
    with private corporations nationwide must search throughout the country
    to obtain forensic training. This translates into an investigative gap,
    particularly pronounced in the Southeast United States, costing reduced
    productivity, delayed justice, and loss of funds. Compounding this
    situation is the fact that the technology and science are changing so
    rapidly that ongoing training and skill upgrades are necessary.
        The establishment of a National Academy for Forensic Computing and
    Investigation (NAFCI) at centrally located CPCC can help to bridge the
    investigative gap both regionally and nationally while providing high
    skill careers for North Carolina.
        CPCC's Public Safety facility at the North Campus is the home to
    the College's Criminal Justice Program. Today, the North Campus serves
    more than 12,000 citizens of the Charlotte-Mecklenburg region on an
    annual basis. In addition, the facility is the primary training site
    for ten local, two State, and three Federal agencies.
        There are currently three course areas under the umbrella term
    public safety at CPCC's North Campus--police, fire, and rescue.
    Associates' degrees are available in Criminal Justice and in Fire
    Protection Technology, and in-service training for all three groups is
    available. An additional component within the criminal justice arena is
    a Regional Training Center, headquartered at CPCC that is responsible,
    in a 13-county area, for providing in-service training for criminal
    justice professionals in North Carolina. CPCC is also the primary
    training source for all Firefighter I and II level personnel with the
    Charlotte Fire Department and all volunteer firefighters in Mecklenburg
    County. Given this breadth of experience, CPCC is the institution best
    positioned to take on the responsibility of addressing the need for
    forensic training.
        The development and implementation of the NAFCI will serve to
    increase the skills of the current workforce reliant upon and adversely
    affected by a lack of appropriate training in forensic science. These
    groups include law enforcement officers, fire service, prosecutors and
    criminal attorneys, investigators, crime laboratory personnel, medical
    examiners and coroners, correctional personnel, insurance
    investigators, agents, and claims adjusters, fraud examiners, social
    services professionals, and nurses.
        The Academy's emphasis on Computer Forensics will demonstrate the
    value of the application of computer technologies in solving the
    information needs of anyone required to conduct forensic
    investigations. Each of the following topics represents a computer
    class; others will be developed as required:
      --Facial Reconstruction of Unknown Human Remains--Digital Imaging
      --Information Systems Security--Cyber Crime
      --Identifying and locating the Cyber Criminal--Voice Recognition
      --Reconstruction of Damaged Computer Software--Fingerprint
            Identification
      --Using the Computer to Determine Time of Crime--Firearms
            Identification
      --Construction of new Evidence Tracking Systems--Dental
            Identification
      --Computerized Collision Diagramming--DNA Data Retrieval
        The workforce development goals of this initiative are to train or
    retrain 2,000 workers in the forensics field within the first 5 years.
    This timely response will result in a significant change in the way
    that CPCC accomplishes workforce development. Through the creation of
    an effective bridge between industry and academia, CPCC hopes to become
    a national model for community colleges across the country not only in
    the field of forensic science but also in other fields where workforce
    gaps exist.
        Given industry's need and the characteristics of the target
    audience, CPCC proposes innovative strategies for success. One of the
    most unique features of this initiative is that CPCC has bridged the
    gap between industry and academia by forming an Industry Advisory Panel
    charged with providing direct and substantial course input throughout
    the life of this initiative. The panel includes a diverse array of
    leading edge companies dependent upon forensics for the success of
    their business. Needs assessments will be conducted to determine skill
    areas that require further development, and special courses will be
    designed and implemented based on statements of need. NAFCI will then
    create intensive courses for faculty in the various fields as well as
    for current professionals in the various areas. For example, social
    services workers can be educated on the indicators of child abuse and
    correct use of the multidisciplinary approach to child abuse
    investigation. Courses in forensic computing, accounting, arson
    investigation, forensic accident reconstruction, and bodily injury can
    be offered to fraud investigators.
        The NAFCI seeks to develop curriculum strategies and educational
    materials that meet the needs of all the vast and varied types of life-
    long learners. Thus, in addition to the more standard educational
    materials, CPCC will develop and offer short-term training modules for
    the certificate seeker and on-line courses for the law enforcement
    professionals who are much better served by courseware unlimited by
    time or place. Opportunities for education in the field via service
    learning programs and/or internship experiences will also be utilized.
    NAFCI will also seek to provide state-of-the-art or ``hands-on''
    training for the investigative professional along with continuing
    education approved by the appropriate certifying board of each State
    serviced.
        NAFCI will increase the number of people who have the forensic
    skills to develop and support community-based investigations,
    especially in rural areas of the country. For example, the NAFCI will
    actively seek to train experienced Registered Nurses from rural areas
    to become forensic nurses by conducting advanced courses in forensic
    pathology, forensic dentistry, and forensic anthropology. These nurses
    may then assist rural law enforcement agencies with evidence collection
    from violent crimes. The Center will also promote public education
    concerning all disciplines in the forensic sciences, and serve as a
    major source for national certification by the American Board of
    Medicolegal Death Investigators, Inc.
        Educational materials will be produced and widely disseminated via
    various means including, electronic media, CD-ROMS, conferences,
    journal articles, manuals, newsletters, on-line courses with
    interactive laboratory experiences, summer institutes, videos, and
    workshops
        In addition, CPCC will liaison directly with the local high school
    populations via College Tech Prep, Upward Bound, and Talent Search
    programs to assist disadvantaged students prepare for forensics
    technology careers. Additional outreach to disadvantaged populations
    will take place via CPCC's collaborations with the local JOBSLINK
    (North Carolina's One-Stop Career Shop). JOBSLINK is a project
    sponsored by the State Employment Service Office, JTPA, the Department
    of Social Services, and Office of Vocational Rehabilitation. Although
    designed to meet the needs of everyone, JOBSLINK has specific
    responsibilities for working with welfare recipients and the
    unemployed. Because CPCC provides staffing to JOBSLINK, faculty will
    have the opportunity to intimately recruit students from the local
    disadvantaged population. Further, there is potential for developing a
    ``pipeline'' between CPCC and 4-year institutions that allow students
    to specialize in areas of science related to forensics so that those
    students will be prepared to enter into laboratory work, field work or
    graduate forensic programs.
        In addition, the North Carolina State Bureau of Investigation
    maintains a full-service laboratory in Raleigh and a limited-service
    laboratory in Asheville, for the purpose of examining all types of
    evidence related to criminal investigations. The establishment of a
    National Academy for Forensic Computing and Investigation at CPCC could
    provide a training link to these two institutions.
        To accomplish these goals CPCC is seeking a total of $3.5 million
    in additional federal partnership assistance to establish the
    approximately $7.2 million Center, which will include a state-of-the-
    art forensics laboratory. A Federal investment in this initiative is
    warranted for the contribution that the NAFCI can make toward filling
    an investigative gap that exists in the region, for the new careers
    that will be established, and for the necessary upgrading of skill
    levels for the better functioning of North Carolina's criminal justice
    system.
                                     ______

          Prepared Statement of the American Public Power Association

        The American Public Power Association (APPA) is the national
    service organization representing the interests of over 2,000 municipal
    and other state and locally owned utilities throughout the United
    States. Collectively, public power utilities deliver electric energy to
    one of every eight U.S. electric consumers (about 40 million people),
    serving some of the nation's largest cities. The majority of APPA's
    member systems are located in small and medium-sized communities in
    every state except Hawaii.
        We appreciate the opportunity to submit this testimony in support
    of fiscal year 2002 appropriations for the Federal Trade Commission and
    the Antitrust Division of the Department of Justice.
        The electric power industry is in the midst of sweeping and
    dramatic change, with a record number of mergers over the last four
    years. Add to this change, the recent lawsuits filed against wholesale
    electricity suppliers in California by the Independent System Operator
    alleging market power abuse. In addition, several cities in California
    have filed lawsuits alleging that a coalition of gas companies
    illegally attempted to eliminate competition, thus engaging in
    antitrust violations that caused natural gas prices to skyrocket. The
    industry experienced little competition in the past, except for
    franchise competition between investor-owned utilities (IOUs) on the
    one hand and publicly and cooperatively owned utilities on the other.
    During this transitional period--as this important, closely regulated
    industry moves towards increased competition--sufficient resources are
    necessary so that the two federal antitrust agencies can adequately
    perform merger assessments.
        The Department of Justice Antitrust Division and the Federal Trade
    Commission play a critical advisory role along with the Federal Energy
    Regulatory Commission (FERC) with respect to antitrust monitoring and
    enforcement in the electric utility industry.
        Important lessons have been learned through the deregulatory
    experiences of the airlines, cable, and telecommunications industries.
    As the electric power industry struggles to transition from regulation
    to competition, those lessons must inform the policies and process that
    will guide, and ultimately determine, the structure of a competitive
    electric power industry.
        There is no need to start at the bottom of the deregulation
    learning curve, or to repeat the mistakes made in other industries.
        Mergers among electric utilities are having a profound negative
    effect on the development of competition in the electric industry. In
    fact, because utility mergers determine the basic structure of the
    electric power industry, they actually have the potential to define (or
    preclude the development of) the competitive landscape. The recent wave
    of electric utility mergers certainly has increased concentration in
    the industry, as the number of firms that are legally and practically
    capable of providing electric service declines through consolidation.
    Largely for the same reasons, the structural impacts of such mergers
    will likely be long term. What is not known is whether mergers of
    incumbent electric utilities and/or other wholesale power suppliers,
    collectively or individually, are on balance procompetitive or
    anticompetitive. Specifically, there are a number of unknowns about
    electric utility mergers:
      --Whether an increase in concentration will produce associated
            efficiencies;
      --Whether any efficiencies that do result will be passed on to
            consumers in the form of lower electric rates, or instead be
            passed on to shareholders, or used for diversification;
      --Whether an increase in concentration will simply serve to fortify
            existing market power to exclude new entrants, drive out new
            entrants through price competition and mergers, purchase
            existing competitors, or result in excessive profits.
        As the mixed deregulatory experiences of other industries
    demonstrate, these are not questions that can be accurately answered in
    the absence of actual market data. The pressure placed on DOJ's
    Antitrust Division and the FTC will be enormous as we search for the
    answers to these and many more questions.
        APPA urges Congress to provide the Antitrust Division of the
    Department of Justice and the Federal Trade Commission adequate funding
    in fiscal year 2002 that will ensure the agencies can continue to
    perform their consumer protection roles.
                                     ______

      Prepared Statement of the Northwest Tribal Court Judges Association

        On behalf of the Northwest Tribal Court Judges Association
    (NWTCJA), I am pleased to submit this written testimony on the fiscal
    year 2002 Appropriations for Justice Department funding of the Indian
    Country Law Enforcement Initiative and the Indian Tribal Justice
    Technical and Legal Assistance Act of 2000 (Public Law 106-559).
        The NWTCJA is a voluntary regional representative membership
    association (non-profit association organized in 1981), whose active
    members include any duly appointed or elected judge for any Indian
    tribe located in the States of Washington, Oregon, Idaho, and Alaska.
    NWTCJA represents more than 37 tribal justice systems in the Northwest,
    has a twenty-year track record of providing quality training and
    technical assistance services to tribal justice systems. The mission of
    the NWTCJA is ``to provide a forum for communication and cooperation
    among and between tribal court judges and other entities to enhance the
    training and skills of court personnel and to secure resources to
    accomplish these ends in the interest of better serving tribal people,
    communities, and our sovereign nations.'' We provide training for court
    personnel and need money to accomplish these purposes.
        Justice Department Funding.--Indian Country Law Enforcement
    Initiative and Indian Tribal Justice Technical and Legal Assistance Act
    of 2000 (Public Law 106-559)
        (1) Full Funding for Indian Country Law Enforcement Initiative.--
    NWTCJA strongly supports full funding for the Indian Country Law
    Enforcement Initiative ($173.3 million in Justice Department funding as
    requested in the Justice Department's fiscal year 2001 budget). NWTCJA
    would like to specifically emphasize our support for the funding of the
    Indian Tribal Court Fund at a level of at least $15 million (Please
    note that this fund was formally authorized by the 106th Congress--see
    Public Law 106-559, Section 201). Through the increased funding for law
    enforcement under the Indian Country Law Enforcement Initiative, more
    police officers have been added throughout Indian Country without the
    accompanying funds to support tribal courts that will be impacted by
    the increased caseloads generated by this increased law enforcement.
        (2) At least $15 million in funding for the Indian Tribal Justice
    Technical and Legal Assistance Act of 2000 (Public Law 106-559).--When
    the 106th Congress enacted Public Law 106-559 in December 2000, it
    recognized the vital legal and technical assistance needs of tribal
    justice systems--finding in part that ``there are both inadequate
    funding and inadequate coordinating mechanisms to meet the technical
    and legal assistance needs of tribal justice systems and this lack of
    adequate technical and legal assistance funding impairs their
    operation'' and promised three grant programs to address these
    Congressional recognized needs. It is vital that Congress provide
    adequate funding for Public Law 106-559 (see the Act itself for more
    specific information). NWTCJA strongly supports funding of Public Law
    106-559 at the level of at least $15 million. Failure to provide this
    funding level will make the Indian Tribal Justice Technical and Legal
    Assistance Act of 2000 (Public Law 106-559) a hollow recognition of
    tribal justice systems needs without providing needed resources. Native
    American tribal courts must deal with a wide range of difficult
    criminal and civil justice problems on a daily basis, including the
    following:
      --The violent crime rate has been declining nationally but increasing
            substantially in Indian Country. Tribal court systems are
            grossly under-funded to deal with these criminal justice
            problems.
      --The case number and complexity of tribal civil caseloads have also
            been rapidly expanding.
      --Congress recognized this need when it enacted the Indian Tribal
            Justice Act--specifically finding that ``tribal justice systems
            are an essential part of tribal governments and serve as
            important forums for ensuring public health and safety and the
            political integrity of tribal governments'' and ``tribal
            justice systems are inadequately funded, and the lack of
            adequate funding impairs their operation.''
      --While the Indian Tribal Justice Act promised $58.4 million per year
            in additional funding for tribal court systems starting in
            fiscal year 1994, THERE HAS BEEN NO FUNDING provided tribal
            courts under this Act.
      --Since enactment of the Indian Tribal Justice Act, the needs of
            tribal court systems have continued to increase, with no
            corresponding increase in funding. In fact, the Bureau of
            Indian Affairs' funding for tribal courts has actually
            decreased substantially since the Indian Tribal Justice Act was
            enacted in 1993.
      --The 106th Congress re-affirmed the Congressional commitment to
            provide this increased funding for tribal justice systems when
            it re-authorized the Indian Tribal Justice Act in December 2000
            for 7 more years of funding at a level of $58.4 million per
            year (see Public Law 106-559, section 202).
        As the former Attorney General, Janet Reno, stated in testimony
    before the Senate Indian Affairs Committee, it is vital to ``better
    enable Indian tribal courts, historically under-funded and under-
    staffed, to meet the demands of burgeoning caseloads.'' The Attorney
    General indicated that the ``lack of a system of graduated sanctions
    through tribal court, that stems from severely inadequate tribal
    justice support, directly contributes to the escalation of adult and
    juvenile criminal activity.''
        The majority of the existing tribal justice systems in the
    Northwest and the more than 100 developing tribal court systems in
    Alaska, function in isolated rural communities. These tribal justice
    systems face many of the same difficulties faced by other isolated
    rural communities, but these problems are greatly magnified by the many
    other complex problems that are unique to Indian country. In addition
    to the previously-mentioned problems, tribal justice systems are faced
    with a lack of jurisdiction over non-Indians, complex jurisdictional
    relationships with Federal and State criminal justice systems,
    inadequate law enforcement, great distance from the few existing
    resources, lack of detention staff and facilities, lack of sentencing
    or disposition alternatives, lack of access to advanced technology,
    lack of substance abuse testing and treatment options, and lack of
    resources to hold people accountable, i.e. no monies for probation. It
    should also be noted that in most tribal justice systems, 80-90 percent
    of the cases filed are criminal cases, and 90 percent of these cases
    involve the difficult problems of alcohol and/or substance abuse. While
    a few tribal courts are just beginning the planning and implementation
    of Drug Courts with monies from the DCPO, these monies are provided for
    only a few years, are limited in amounts, and provide a temporary
    panacea to the ever increasing problem of drug addiction in our young
    people.
                          importance of tribal courts
        ``Tribal courts constitute the frontline tribal institutions that
    most often confront issues of self-determination and sovereignty, while
    at the same time they are charged with providing reliable and equitable
    adjudication in the many and increasingly diverse matters that come
    before them. In addition, they constitute a key tribal entity for
    advancing and protecting the rights of self-government. . . . Tribal
    courts are of growing significance in Indian Country.'' (Frank
    Pommersheim, Braid of Feathers: American Indian Law and Contemporary
    Tribal Law 57 (1995)). Tribal justice systems are the primary and most
    appropriate institutions for maintaining order in tribal communities.
    Former Attorney General Reno acknowledged that, ``With adequate
    resources and training, they are most capable of crime prevention and
    peacekeeping'' (A Federal Commitment to Tribal Justice Systems, 79
    Judicature No. 7, November/December 1995, p. 114). It is her view that
    ``fulfilling the Federal Government's trust responsibility to Indian
    nations means not only adequate Federal law enforcement in Indian
    Country, but enhancement of tribal justice systems as well.'' Id.
        Tribal courts agonize over the very same issues State and Federal
    courts confront in the criminal context, such as child sexual abuse,
    alcohol and substance abuse, gang violence and violence against women.
    These courts, however, while striving to address these complex issues
    with far fewer financial resources than their Federal and State
    counterparts must also ``strive to respond competently and creatively
    to Federal and State pressures coming from the outside, and to cultural
    values and imperatives from within.'' (Pommersheim, ``Tribal Courts:
    Providers of Justice and Protectors of Sovereignty,'' 79 Judicature No.
    7, November/December 1995, p. 111). Judicial training that addresses
    the present imperatives posed by the public safety crisis in Indian
    Country, while also being culturally sensitive, is essential for tribal
    courts to be effective in deterring crime in their communities.
        There is no federally-supported institution to provide on-going,
    accessible tribal judicial training or to develop court resource
    materials and management tools, similar to the Federal Judicial Center,
    the National Judicial College or the National Center for State Courts.
    Even though the NWTCJA provides local training, the three or four
    meetings each year with one day of training at each meeting, cannot
    provide the in-depth extensive judicial training necessary to make
    tribal justice systems strong and effective arms of tribal government.
    Furthermore, in these difficult economic times, many tribes cannot
    afford to send judges to the trainings that are offered.
                  inadequate funding of tribal justice systems
        There is no question that tribal justice systems are, and
    historically have been, underfunded. The 1991 United States Civil
    Rights Commission found that ``the failure of the United States
    Government to provide proper funding for the operation of tribal
    judicial systems . . . has continued for more than 20 years.'' The
    Indian Civil Rights Act: A Report of the United States Civil Rights
    Commission, June 1991, p. 71. The Commission also noted that
    ``[f]unding for tribal judicial systems may be further hampered in some
    instances by the pressures of competing priorities within a tribe.''
    Moreover, they opined that ``If the United States Government is to live
    up to its trust obligations, it must assist tribal governments in their
    development . . .'' Almost 10 years ago, the Commission ``strongly
    support[ed] the pending and proposed congressional initiatives to
    authorize funding of tribal courts in an amount equal to that of an
    equivalent State court'' and was ``hopeful that this increased funding
    [would] allow for much needed increases in salaries for judges, the
    retention of law clerks for tribal judges, the funding of public
    defenders/defense counsel, and increased access to legal authorities.''
        As indicated by the Civil Rights Commission, the critical financial
    need of tribal courts has been well-documented and ultimately led to
    the passage of the Indian Tribal Justice Act, 25 U.S.C. Sec. 3601 et
    seq. (the ``Act''). Congress found that ``[T]ribal justice systems are
    an essential part of tribal governments and serve as important forums
    for ensuring public health, safety and the political integrity of
    tribal governments.'' 25 U.S.C. Sec. 3601(5). Affirming the findings of
    the Civil Rights Commission, Congress further found that ``tribal
    justice systems are inadequately funded, and the lack of adequate
    funding impairs their operation.'' 25 U.S.C. Sec. 3601(8). In order to
    remedy this lack of funding, the Act authorized appropriation base
    funding support for tribal justice systems in the amount of $50,000,000
    for each of the fiscal years 1994 through 2000. 25 U.S.C. Sec. 3621(b).
    An additional $500,000 for each of the same fiscal years was authorized
    to be appropriated for the administration of Tribal Judicial
    Conferences for the ``development, enhancement and continuing operation
    of tribal justice systems . . .'' 25 U.S.C. Sec. 3614.
        Eight (8) years after the Act was enacted, how much funding has
    been appropriated? Not one single dollar was even requested under the
    Act for fiscal years 1994, 1995, 1997, 1998 or 1999. Only minimal funds
    were requested for fiscal year 1996 and 2000. Yet, even these minimal
    funds were deleted. Even more appalling than the lack of appropriations
    under the Act is the fact that BIA funding for tribal courts has
    actually substantially decreased following the enactment of the Indian
    Tribal Justice Act in 1993 in anticipation of Congress making the
    appropriations Indian Country believed it would. In December 2000,
    Congress re-affirmed its commitment to funding of the Indian Tribal
    Justice Act by re-authorizing the Act for 7 more years of funding (see
    Public Law 106-559, Section 202) but it did so without appropriating
    any monies for that purpose. Now is the time to follow through on this
    long promised funding and provide actual funding under the Indian
    Tribal Justice Act!
                                   conclusion
        Tribal justice systems are the primary and most appropriate
    institutions for maintaining order in tribal communities. They are the
    keystone to tribal economic development and self-sufficiency. Any
    serious attempt to fulfill the Federal Government's trust
    responsibility to Indian Nations must include increased funding and
    enhancement of tribal justice systems. The Northwest Tribal Court
    Judges Association welcomes the opportunity to comment on the Justice
    Department's Budget Request for the fiscal year 2002 funding of the
    Indian Country Law Enforcement Initiative and the Indian Tribal Justice
    Technical and Legal Assistance Act of 2000. Thank you very much.
                                     ______

        Prepared Statement of the National American Indian Court Judges
                                  Association

        On behalf of the National American Indian Court Judges Association
    (NAICJA), I am pleased to submit this written testimony on the fiscal
    year 2002 Appropriations for Justice Department funding of the Indian
    Country Law Enforcement Initiative and the Indian Tribal Justice
    Technical and Legal Assistance Act of 2000 (Public Law 106-559).
        The NAICJA is a voluntary national representative membership
    association (non-profit organization incorporated in 1969) of current
    and former tribal court judges throughout the United States. NAICJA,
    which represents more than 350 tribal justice systems nationwide, has a
    thirty-year track record of providing quality training and technical
    assistance services for tribal justice systems.
        Justice Department Funding.--Indian Country Law Enforcement
    Initiative and Indian Tribal Justice Technical and Legal Assistance Act
    of 2000 (Public Law 106-559)
        (1) Full Funding for Indian Country Law Enforcement Initiative.--
    NAICJA strongly supports full funding for the Indian Country Law
    Enforcement Initiative ($173.3 million in Justice Department funding as
    requested in the Justice Department's fiscal year 2001 budget). NAICJA
    would like to specifically emphasize our support for the funding of the
    Indian Tribal Court Fund at a level of at least $15 million (Please
    note that this fund was formally authorized by the 106th Congress--see
    Public Law 106-559, section 201). Through the increased funding for law
    enforcement under the Indian Country Law Enforcement Initiative, more
    police officers have been added throughout Indian Country. Without
    substantial additional funding, tribal courts will be unable to handle
    the increased caseloads generated by this increased law enforcement.
        (2) At least $15 million in funding for the Indian Tribal Justice
    Technical and Legal Assistance Act of 2000 (Public Law 106-559).--When
    the 106th Congress enacted Public Law 106-559 in December 2000, it
    recognized the vital legal and technical assistance needs of tribal
    justice systems--finding in part that ``there is both inadequate
    funding and inadequate coordinating mechanism to meet the technical and
    legal assistance needs of tribal justice systems and this lack of
    adequate technical and legal assistance funding impairs their
    operation'' and promised three grant programs to address these
    Congressional recognized needs. It is vital that Congress provide
    adequate funding for Public Law 106-559 (see the Act itself for more
    specific information). NAICJA strongly supports funding of Public Law
    106-559 at the level of at least $15 million. Failure to provide this
    funding level would make the Indian Tribal Justice Technical and Legal
    Assistance Act of 2000 (Public Law 106-559) a hollow recognition of
    tribal justice systems needs without providing needed resources. Native
    American tribal courts must deal with a wide range of difficult
    criminal and civil justice problems on a daily basis, including the
    following:
      --While the crime rate, especially the violent crime rate, has been
            declining nationally, it has increased substantially in Indian
            Country. Tribal court systems are grossly under-funded to deal
            with these criminal justice problems.
      --Number/complexity of tribal civil caseloads have also been rapidly
            expanding.
      --Congress recognized this need when it enacted the Indian Tribal
            Justice Act--specifically finding that ``tribal justice systems
            are an essential part of tribal governments and serve as
            important forums for ensuring public health and safety and the
            political integrity of tribal governments'' and ``tribal
            justice systems are inadequately funded, and the lack of
            adequate funding impairs their operation.''
      --While the Indian Tribal Justice Act promised $58.4 million per year
            in additional funding for tribal court systems starting in
            fiscal year 1994, tribal courts have yet to see ANY funding
            under this Act.
      --Since Congress enacted the Indian Tribal Justice Act, the needs of
            tribal court systems have continued to increase, but there has
            been no corresponding increase in funding for tribal court
            systems. In fact, the Bureau of Indian Affairs funding for
            tribal courts has actually decreased substantially since the
            Indian Tribal Justice Act was enacted in 1993.
      --The 106th Congress re-affirmed the Congressional commitment to
            provide this increased funding for tribal justice systems when
            it re-authorized the Indian Tribal Justice Act in December 2000
            for seven more years of funding at a level of $58.4 million per
            year (see Public Law 106-559, section 202).
        As Attorney General Janet Reno stated in testimony before the
    Senate Indian Affairs Committee on, it is vital to ``better enable
    Indian tribal courts, historically under-funded and under-staffed, to
    meet the demands of burgeoning case loads.'' The Attorney General
    indicated that the ``lack of a system of graduated sanctions through
    tribal court, that stems from severely inadequate tribal justice
    support, directly contributes to the escalation of adult and juvenile
    criminal activity.''
        The vast majority of the approximately 350 tribal court systems
    function in isolated rural communities. These tribal justice systems
    face many of the same difficulties faced by other isolated rural
    communities, but these problems are greatly magnified by the many other
    complex problems that are unique to Indian country. In addition to the
    previously mentioned problems, tribal justice systems are faced with a
    lack of jurisdiction over non-Indians, complex jurisdictional
    relationships with Federal and State criminal justice systems,
    inadequate law enforcement, great distance from the few existing
    resources, lack of detention staff and facilities, lack of sentencing
    or disposition alternatives, lack of access to advanced technology,
    lack of substance abuse testing and treatment options, etc. It should
    also be noted that in most tribal justice systems, 80-90 percent of the
    cases are criminal case and 90 percent of these cases involve the
    difficult problems of alcohol and/or substance abuse.
                          importance of tribal courts
        ``Tribal courts constitute the frontline tribal institutions that
    most often confront issues of self-determination and sovereignty, while
    at the same time they are charged with providing reliable and equitable
    adjudication in the many and increasingly diverse matters that come
    before them. In addition, they constitute a key tribal entity for
    advancing and protecting the rights of self-government. . .  Tribal
    courts are of growing significance in Indian Country.'' (Frank
    Pommersheim, Braid of Feathers: American Indian Law and Contemporary
    Tribal Law 57 (1995)). Tribal justice systems are the primary and most
    appropriate institutions for maintaining order in tribal communities.
    Attorney General Reno acknowledged that, ``With adequate resources and
    training, they are most capable of crime prevention and peacekeeping''
    (A Federal Commitment to Tribal Justice Systems, 79 Judicature No. 7,
    November/December 1995, p. 114). It is her view that ``fulfilling the
    Federal Government's trust responsibility to Indian nations means not
    only adequate Federal law enforcement in Indian Country, but
    enhancement of tribal justice systems as well.'' Id.
        Tribal courts agonize over the very same issues State and Federal
    courts confront in the criminal context, such as, child sexual abuse,
    alcohol and substance abuse, gang violence and violence against women.
    These courts, however, while striving to address these complex issues
    with far fewer financial resources than their Federal and State
    counterparts must also ``strive to respond competently and creatively
    to Federal and State pressures coming from the outside, and to cultural
    values and imperatives from within.'' (Pommersheim, ``Tribal Courts:
    Providers of Justice and Protectors of Sovereignty,'' 79 Judicature No.
    7, November/December 1995, p. 111). Judicial training that addresses
    the present imperatives posed by the public safety crisis in Indian
    Country, while also being culturally sensitive, is essential for tribal
    courts to be effective in deterring crime in their communities.
        There is no federally supported institution to provide on-going,
    accessible tribal judicial training or to develop court resource
    materials and management tools, similar the Federal Judicial Center,
    the National Judicial College or the National Center for State Courts.
    Even though the NAICJA annually sponsors the National Tribal Judicial
    Conference, the three-day conference cannot provide the in-depth
    extensive judicial training necessary to make tribal justice systems
    strong and effective arms of tribal government.
                  inadequate funding of tribal justice systems
        There is no question that tribal justice systems are, and
    historically have been, underfunded. The 1991 United States Civil
    Rights Commission found that ``the failure of the United States
    Government to provide proper funding for the operation of tribal
    judicial systems . . . has continued for more than 20 years.'' The
    Indian Civil Rights Act: A Report of the United States Civil Rights
    Commission, June 1991, p. 71. The Commission also noted that
    ``[f]unding for tribal judicial systems may be further hampered in some
    instances by the pressures of competing priorities within a tribe.''
    Moreover, they opined that ``If the United States Government is to live
    up to its trust obligations, it must assist tribal governments in their
    development . . .'' Almost ten years ago, the Commission ``strongly
    support[ed] the pending and proposed congressional initiatives to
    authorize funding of tribal courts in an amount equal to that of an
    equivalent State court'' and was ``hopeful that this increased funding
    [would] allow for much needed increases in salaries for judges, the
    retention of law clerks for tribal judges, the funding of public
    defenders/defense counsel, and increased access to legal authorities.''
        As indicated by the Civil Rights Commission, the critical financial
    need of tribal courts has been well documented and ultimately led to
    the passage of the Indian Tribal Justice Act, 25 U.S.C. Sec. 3601 et
    seq. (the ``Act''). Congress found that ``[T]ribal justice systems are
    an essential part of tribal governments and serve as important forums
    for ensuring public health, safety and the political integrity of
    tribal governments.'' 25 U.S.C. Sec. 3601(5). Affirming the findings of
    the Civil Rights Commission, Congress further found that ``tribal
    justice systems are inadequately funded, and the lack of adequate
    funding impairs their operation.'' 25 U.S.C. Sec. 3601(8). In order to
    remedy this lack of funding, the Act authorized appropriation base
    funding support for tribal justice systems in the amount of $50,000,000
    for each of the fiscal years 1994 through 2000. 25 U.S.C. Sec. 3621(b).
    An additional $500,000 for each of the same fiscal years was authorized
    to be appropriated for the administration of Tribal Judicial
    Conferences for the ``development, enhancement and continuing operation
    of tribal justice systems . . .'' 25 U.S.C. Sec. 3614.
        Eight (8) years after the Act was enacted, how much funding has
    been appropriated? None. Not a single dollar was even requested under
    the Act for fiscal years 1994, 1995, 1997, 1998 or 1999. Only minimal
    funds were requested for fiscal year 1996 and 2000. Yet, even these
    minimal funds were deleted. Even more appalling than the lack of
    appropriations under the Act is the fact that BIA funding for tribal
    courts has actually substantially decreased following the enactment of
    the Indian Tribal Justice Act in 1993. In December 2000, Congress re-
    affirmed its commitment to funding of the Indian Tribal Justice Act by
    re-authorizing the Act for seven more years of funding (see Public Law
    106-559, section 202). Now is the time to follow through on this long
    promised funding and provide actual funding under the Indian Tribal
    Justice Act!
                                   conclusion
        Tribal justice systems are the primary and most appropriate
    institutions for maintaining order in tribal communities. They are the
    keystone to tribal economic development and self-sufficiency. Any
    serious attempt to fulfill the Federal Government's trust
    responsibility to Indian Nations must include increased funding and
    enhancement of tribal justice systems.
        We welcome the opportunity to comment on the Justice Department's
    Budget Request for the fiscal year 2002 funding of the Indian Country
    Law Enforcement Initiative and the Indian Tribal Justice Technical and
    Legal Assistance Act of 2000 (Public Law 106-559). Thank you very much.
                                     ______

             Prepared Statement of the Alaska Inter-Tribal Council

        On behalf of the Alaska Inter-Tribal Council (AITC), I am pleased
    to submit this written testimony on the fiscal year 2002 Appropriations
    for Justice Department funding of the Indian Country Law Enforcement
    Initiative and the Indian Tribal Justice Technical and Legal Assistance
    Act of 2000 (Public Law 106-559).
        The AITC is a statewide organization comprised of 176 federally
    recognized member Tribes dedicated to promoting, supporting and
    advocating for the powers and rights of Alaska Tribal governments
    including the development and perpetuation of tribal justice systems,
    the exercise of judicial authority and the administration of justice.
        Justice Department Funding.--Indian Country Law Enforcement
    Initiative and Indian Tribal Justice Technical and Legal Assistance Act
    of 2000 (Public Law 106-559)
        (1) Full Funding for Indian Country Law Enforcement Initiative.--
    AITC strongly supports full funding for the Indian Country Law
    Enforcement Initiative ($173.3 million in Justice Department funding as
    requested in the Justice Department's fiscal year 2001 budget). AITC
    would like to specifically emphasize our support for the funding of the
    Indian Tribal Court Fund at a level of at least $15 million (Please
    note that this fund was formally authorized by the 106th Congress--see
    Public Law 106-559, section 201). Through the increased funding for law
    enforcement under the Indian Country Law Enforcement Initiative, more
    police officers have been added throughout Indian Country. Without
    substantial additional funding, tribal courts will be unable to handle
    the increased caseloads generated by this increased law enforcement.
        (2) At least $15 million in funding for the Indian Tribal Justice
    Technical and Legal Assistance Act of 2000 (Public Law 106-559). When
    the 106th Congress enacted Public Law 106-559 in December 2000, it
    recognized the vital legal and technical assistance needs of tribal
    justice systems--finding in part that ``there is both inadequate
    funding and inadequate coordinating mechanism to meet the technical and
    legal assistance needs of tribal justice systems and this lack of
    adequate technical and legal assistance funding impairs their
    operation'' and promised three grant programs to address these
    Congressional recognized needs. It is vital that Congress provide
    adequate funding for Public Law 106-559 (see the Act itself for more
    specific information). AITC strongly supports funding of Public Law
    106-559 at the level of at least $15 million. Failure to provide this
    funding level would make the Indian Tribal Justice Technical and Legal
    Assistance Act of 2000 (Public Law 106-559) a hollow recognition of
    tribal justice systems needs without providing needed resources. Alaska
    Native and Native American tribal courts must deal with a wide range of
    difficult criminal and civil justice problems on a daily basis,
    including the following:
      --While the crime rate, especially the violent crime rate, has been
            declining nationally, it has increased substantially in tribal
            communities nationwide. Tribal court systems are grossly under-
            funded to deal with these criminal justice problems.
      --Number/complexity of tribal civil caseloads have also been rapidly
            expanding.
      --Congress recognized this need when it enacted the Indian Tribal
            Justice Act--specifically finding that ``tribal justice systems
            are an essential part of tribal governments and serve as
            important forums for ensuring public health and safety and the
            political integrity of tribal governments'' and ``tribal
            justice systems are inadequately funded, and the lack of
            adequate funding impairs their operation.''
      --While the Indian Tribal Justice Act promised $58.4 million per year
            in additional funding for tribal court systems starting in
            fiscal year 1994, tribal courts have yet to see ANY funding
            under this Act.
      --Since Congress enacted the Indian Tribal Justice Act, the needs of
            tribal court systems have continued to increase, but there has
            been no corresponding increase in funding for tribal court
            systems. In fact, the Bureau of Indian Affairs funding for
            tribal courts has actually decreased substantially since the
            Indian Tribal Justice Act was enacted in 1993. Moreover, Alaska
            Native Tribes have historically never had access to BIA funds
            for tribal courts or law enforcement.
      --The 106th Congress re-affirmed the Congressional commitment to
            provide this increased funding for tribal justice systems when
            it re-authorized the Indian Tribal Justice Act in December 2000
            for seven more years of funding at a level of $58.4 million per
            year (see Public Law 106-559, section 202).
        As Attorney General Janet Reno stated in testimony before the
    Senate Indian Affairs Committee on, it is vital to ``better enable
    Indian tribal courts, historically under-funded and under-staffed, to
    meet the demands of burgeoning case loads.'' The Attorney General
    indicated that the ``lack of a system of graduated sanctions through
    tribal court, that stems from severely inadequate tribal justice
    support, directly contributes to the escalation of adult and juvenile
    criminal activity.''
        Since time immemorial Alaska Native Tribes have maintained peace,
    law and order in their communities through the exercise of indigenous
    juridical, social and political authority. Today, Alaska Natives
    continue to administer justice through their modern day Tribal
    governments, councils and courts. Over 100 of the 229 federally
    recognized Tribes located in Alaska are actively establishing or
    operating single tribal courts systems, inter-tribal/regional and/or
    appellate courts. This constitutes a significant amount of tribal court
    activity nationwide since almost half (229) of the Tribes in the United
    States are located in Alaska. The vast majority of the approximately
    100 tribal court systems in Alaska function in isolated rural
    communities. Moreover, most Alaska Tribal courts are intervening in
    domestic relations and civil/family law matters involving child
    protection, adoptions, child custody and juvenile delinquency. These
    tribal justice systems face many of the same difficulties faced by
    other tribes in the lower 48 States and other isolated rural
    communities. These problems are greatly magnified by the many other
    complex problems that are unique to Tribes. For instance, tribal
    justice systems are faced with complex jurisdictional relationships
    with Federal and State criminal justice systems, inadequate law
    enforcement, great distance from the few existing resources, lack of
    detention staff and facilities, lack of sentencing or disposition
    alternatives, lack of access to advanced technology, lack of substance
    abuse testing and treatment options, etc. It should also be noted that
    in most tribal justice systems, 80-90 percent of the cases are criminal
    cases and 90 percent of these cases involve the difficult problems of
    alcohol and/or substance abuse.
                          importance of tribal courts
        ``Tribal courts constitute the frontline tribal institutions that
    most often confront issues of self-determination and sovereignty, while
    at the same time they are charged with providing reliable and equitable
    adjudication in the many and increasingly diverse matters that come
    before them. In addition, they constitute a key tribal entity for
    advancing and protecting the rights of self-government. . . . Tribal
    courts are of growing significance in Indian Country.'' (Frank
    Pommersheim, Braid of Feathers: American Indian Law and Contemporary
    Tribal Law 57 (1995). Tribal justice systems are the primary and most
    appropriate institutions for maintaining order in tribal communities.
    Attorney General Reno acknowledged that, ``With adequate resources and
    training, they are most capable of crime prevention and peacekeeping''
    (A Federal Commitment to Tribal Justice Systems, 79 Judicature No. 7,
    November/December 1995, p. 114). These courts, however, while striving
    to address these complex issues with far fewer financial resources than
    their Federal and State counterparts must also ``strive to respond
    competently and creatively to Federal and State pressures coming from
    the outside, and to cultural values and imperatives from within.''
    (Pommersheim, ``Tribal Courts: Providers of Justice and Protectors of
    Sovereignty,'' 79 Judicature No. 7, November/December 1995, p. 111).
                  inadequate funding of tribal justice systems
        There is no question that tribal justice systems are, and
    historically have been, underfunded. The 1991 United States Civil
    Rights Commission found that ``the failure of the United States
    Government to provide proper funding for the operation of tribal
    judicial systems . . . has continued for more than 20 years.'' The
    Indian Civil Rights Act: A Report of the United States Civil Rights
    Commission, June 1991, p. 71. The Commission also noted that
    ``[f]unding for tribal judicial systems may be further hampered in some
    instances by the pressures of competing priorities within a tribe.''
    Moreover, they opined that ``If the United States Government is to live
    up to its trust obligations, it must assist tribal governments in their
    development . . .'' Almost ten years ago, the Commission ``strongly
    support[ed] the pending and proposed congressional initiatives to
    authorize funding of tribal courts in an amount equal to that of an
    equivalent State court'' and was ``hopeful that this increased funding
    [would] allow for much needed increases in salaries for judges, the
    retention of law clerks for tribal judges, the funding of public
    defenders/defense counsel, and increased access to legal authorities.''
        As indicated by the Civil Rights Commission, the critical financial
    need of tribal courts has been well documented and ultimately led to
    the passage of the Indian Tribal Justice Act, 25 U.S.C. Sec. 3601 et
    seq. (the ``Act''). Congress found that ``[T]ribal justice systems are
    an essential part of tribal governments and serve as important forums
    for ensuring public health, safety and the political integrity of
    tribal governments.'' 25 U.S.C. Sec. 3601(5). Affirming the findings of
    the Civil Rights Commission, Congress further found that ``tribal
    justice systems are inadequately funded, and the lack of adequate
    funding impairs their operation.'' 25 U.S.C. Sec. 3601(8). In order to
    remedy this lack of funding, the Act authorized appropriation base
    funding support for tribal justice systems in the amount of $50,000,000
    for each of the fiscal years 1994 through 2000. 25 U.S.C. Sec. 3621(b).
    An additional $500,000 for each of the same fiscal years was authorized
    to be appropriated for the administration of Tribal Judicial
    Conferences for the ``development, enhancement and continuing operation
    of tribal justice systems . . .'' 25 U.S.C. Sec. 3614.
        Eight (8) years after the Act was enacted, how much funding has
    been appropriated? None. Not a single dollar was even requested under
    the Act for fiscal years 1994, 1995, 1997, 1998 or 1999. Only minimal
    funds were requested for fiscal year 1996 and 2000. Yet, even these
    minimal funds were deleted. Even more appalling than the lack of
    appropriations under the Act is the fact that BIA funding for tribal
    courts has actually substantially decreased following the enactment of
    the Indian Tribal Justice Act in 1993. In December 2000, Congress re-
    affirmed its commitment to funding of the Indian Tribal Justice Act by
    re-authorizing the Act for seven more years of funding (see Public Law
    106-559, section 202). Now is the time to follow through on this long
    promised funding and provide actual funding under the Indian Tribal
    Justice Act!
                                   conclusion
        Tribal justice systems are the primary and most appropriate
    institutions for maintaining order in tribal communities. They are the
    keystone to tribal economic development and self-sufficiency. Any
    serious attempt to fulfill the Federal Government's trust
    responsibility to Indian Nations must include increased funding and
    enhancement of tribal justice systems.
        We welcome the opportunity to comment on the Justice Department
    funding of the Indian Country Law Enforcement Initiative and the Indian
    Tribal Justice Technical and Legal Assistance Act of 2000 (Public Law
    106-559).
                                     ______

           Prepared Statement of the Tribal Law and Policy Institute

        On behalf of the Tribal Law and Policy Institute, I am pleased to
    submit this written testimony on the fiscal year 2002 Appropriations
    for Justice Department funding of the Indian Country Law Enforcement
    Initiative and the Indian Tribal Justice Technical and Legal Assistance
    Act of 2000 (Public Law 106-559).
        The Tribal Law and Policy Institute is a Native American owned and
    operated non-profit corporation organized to design and deliver
    education, research, training, and technical assistance programs which
    promote the enhancement of justice in Indian country and the health,
    well-being, and culture of Native peoples.
        Justice Department Funding.--Indian Country Law Enforcement
    Initiative and Indian Tribal Justice Technical and Legal Assistance Act
    of 2000 (Public Law 106-559)
        (1) Full Funding for Indian Country Law Enforcement Initiative.--
    AITC strongly supports full funding for the Indian Country Law
    Enforcement Initiative ($173.3 million in Justice Department funding as
    requested in the Justice Department's fiscal year 2001 budget). AITC
    would like to specifically emphasize our support for the funding of the
    Indian Tribal Court Fund at a level of at least $15 million (Please
    note that this fund was formally authorized by the 106th Congress--see
    Public Law 106-559, section 201). Through the increased funding for law
    enforcement under the Indian Country Law Enforcement Initiative, more
    police officers have been added throughout Indian Country. Without
    substantial additional funding, tribal courts will be unable to handle
    the increased caseloads generated by this increased law enforcement.
        (2) At least $15 million in funding for the Indian Tribal Justice
    Technical and Legal Assistance Act of 2000 (Public Law 106-559). When
    the 106th Congress enacted Public Law 106-559 in December 2000, it
    recognized the vital legal and technical assistance needs of tribal
    justice systems--finding in part that ``there is both inadequate
    funding and inadequate coordinating mechanism to meet the technical and
    legal assistance needs of tribal justice systems and this lack of
    adequate technical and legal assistance funding impairs their
    operation'' and promised three grant programs to address these
    Congressional recognized needs. It is vital that Congress provide
    adequate funding for Public Law 106-559 (see the Act itself for more
    specific information). AITC strongly supports funding of Public Law
    106-559 at the level of at least $15 million. Failure to provide this
    funding level would make the Indian Tribal Justice Technical and Legal
    Assistance Act of 2000 (Public Law 106-559) a hollow recognition of
    tribal justice systems needs without providing needed resources. Alaska
    Native and Native American tribal courts must deal with a wide range of
    difficult criminal and civil justice problems on a daily basis,
    including the following:
      --While the crime rate, especially the violent crime rate, has been
            declining nationally, it has increased substantially in tribal
            communities nationwide. Tribal court systems are grossly under-
            funded to deal with these criminal justice problems.
      --Number/complexity of tribal civil caseloads have also been rapidly
            expanding.
      --Congress recognized this need when it enacted the Indian Tribal
            Justice Act--specifically finding that ``tribal justice systems
            are an essential part of tribal governments and serve as
            important forums for ensuring public health and safety and the
            political integrity of tribal governments'' and ``tribal
            justice systems are inadequately funded, and the lack of
            adequate funding impairs their operation.''
      --While the Indian Tribal Justice Act promised $58.4 million per year
            in additional funding for tribal court systems starting in
            fiscal year 1994, tribal courts have yet to see ANY funding
            under this Act.
      --Since Congress enacted the Indian Tribal Justice Act, the needs of
            tribal court systems have continued to increase, but there has
            been no corresponding increase in funding for tribal court
            systems. In fact, the Bureau of Indian Affairs funding for
            tribal courts has actually decreased substantially since the
            Indian Tribal Justice Act was enacted in 1993. Moreover, Alaska
            Native Tribes have historically never had access to BIA funds
            for tribal courts or law enforcement.
      --The 106th Congress re-affirmed the Congressional commitment to
            provide this increased funding for tribal justice systems when
            it re-authorized the Indian Tribal Justice Act in December 2000
            for seven more years of funding at a level of $58.4 million per
            year (see Public Law 106-559, section 202).
        As Attorney General Janet Reno stated in testimony before the
    Senate Indian Affairs Committee on, it is vital to ``better enable
    Indian tribal courts, historically under-funded and under-staffed, to
    meet the demands of burgeoning case loads.'' The Attorney General
    indicated that the ``lack of a system of graduated sanctions through
    tribal court, that stems from severely inadequate tribal justice
    support, directly contributes to the escalation of adult and juvenile
    criminal activity.''
        Since time immemorial Alaska Native Tribes have maintained peace,
    law and order in their communities through the exercise of indigenous
    juridical, social and political authority. Today, Alaska Natives
    continue to administer justice through their modern day Tribal
    governments, councils and courts. Over 100 of the 229 federally
    recognized Tribes located in Alaska are actively establishing or
    operating single tribal courts systems, inter-tribal/regional and/or
    appellate courts. This constitutes a significant amount of tribal court
    activity nationwide since almost half (229) of the Tribes in the United
    States are located in Alaska. The vast majority of the approximately
    100 tribal court systems in Alaska function in isolated rural
    communities. Moreover, most Alaska Tribal courts are intervening in
    domestic relations and civil/family law matters involving child
    protection, adoptions, child custody and juvenile delinquency. These
    tribal justice systems face many of the same difficulties faced by
    other tribes in the lower 48 States and other isolated rural
    communities. These problems are greatly magnified by the many other
    complex problems that are unique to Tribes. For instance, tribal
    justice systems are faced with complex jurisdictional relationships
    with Federal and State criminal justice systems, inadequate law
    enforcement, great distance from the few existing resources, lack of
    detention staff and facilities, lack of sentencing or disposition
    alternatives, lack of access to advanced technology, lack of substance
    abuse testing and treatment options, etc. It should also be noted that
    in most tribal justice systems, 80-90 percent of the cases are criminal
    cases and 90 percent of these cases involve the difficult problems of
    alcohol and/or substance abuse.
                          importance of tribal courts
        ``Tribal courts constitute the frontline tribal institutions that
    most often confront issues of self-determination and sovereignty, while
    at the same time they are charged with providing reliable and equitable
    adjudication in the many and increasingly diverse matters that come
    before them. In addition, they constitute a key tribal entity for
    advancing and protecting the rights of self-government. . . . Tribal
    courts are of growing significance in Indian Country.'' (Frank
    Pommersheim, Braid of Feathers: American Indian Law and Contemporary
    Tribal Law 57 (1995). Tribal justice systems are the primary and most
    appropriate institutions for maintaining order in tribal communities.
    Attorney General Reno acknowledged that, ``With adequate resources and
    training, they are most capable of crime prevention and peacekeeping''
    (A Federal Commitment to Tribal Justice Systems, 79 Judicature No. 7,
    November/December 1995, p. 114). These courts, however, while striving
    to address these complex issues with far fewer financial resources than
    their Federal and State counterparts must also ``strive to respond
    competently and creatively to Federal and State pressures coming from
    the outside, and to cultural values and imperatives from within.''
    (Pommersheim, ``Tribal Courts: Providers of Justice and Protectors of
    Sovereignty,'' 79 Judicature No. 7, November/December 1995, p. 111).
                  inadequate funding of tribal justice systems
        There is no question that tribal justice systems are, and
    historically have been, underfunded. The 1991 United States Civil
    Rights Commission found that ``the failure of the United States
    Government to provide proper funding for the operation of tribal
    judicial systems . . . has continued for more than 20 years.'' The
    Indian Civil Rights Act: A Report of the United States Civil Rights
    Commission, June 1991, p. 71. The Commission also noted that
    ``[f]unding for tribal judicial systems may be further hampered in some
    instances by the pressures of competing priorities within a tribe.''
    Moreover, they opined that ``If the United States Government is to live
    up to its trust obligations, it must assist tribal governments in their
    development . . .'' Almost ten years ago, the Commission ``strongly
    support[ed] the pending and proposed congressional initiatives to
    authorize funding of tribal courts in an amount equal to that of an
    equivalent State court'' and was ``hopeful that this increased funding
    [would] allow for much needed increases in salaries for judges, the
    retention of law clerks for tribal judges, the funding of public
    defenders/defense counsel, and increased access to legal authorities.''
        As indicated by the Civil Rights Commission, the critical financial
    need of tribal courts has been well documented and ultimately led to
    the passage of the Indian Tribal Justice Act, 25 U.S.C. Sec. 3601 et
    seq. (the ``Act''). Congress found that ``[T]ribal justice systems are
    an essential part of tribal governments and serve as important forums
    for ensuring public health, safety and the political integrity of
    tribal governments.'' 25 U.S.C. Sec. 3601(5). Affirming the findings of
    the Civil Rights Commission, Congress further found that ``tribal
    justice systems are inadequately funded, and the lack of adequate
    funding impairs their operation.'' 25 U.S.C. Sec. 3601(8). In order to
    remedy this lack of funding, the Act authorized appropriation base
    funding support for tribal justice systems in the amount of $50,000,000
    for each of the fiscal years 1994 through 2000. 25 U.S.C. Sec. 3621(b).
    An additional $500,000 for each of the same fiscal years was authorized
    to be appropriated for the administration of Tribal Judicial
    Conferences for the ``development, enhancement and continuing operation
    of tribal justice systems . . .'' 25 U.S.C. Sec. 3614.
        Eight (8) years after the Act was enacted, how much funding has
    been appropriated? None. Not a single dollar was even requested under
    the Act for fiscal years 1994, 1995, 1997, 1998 or 1999. Only minimal
    funds were requested for fiscal year 1996 and 2000. Yet, even these
    minimal funds were deleted. Even more appalling than the lack of
    appropriations under the Act is the fact that BIA funding for tribal
    courts has actually substantially decreased following the enactment of
    the Indian Tribal Justice Act in 1993. In December 2000, Congress re-
    affirmed its commitment to funding of the Indian Tribal Justice Act by
    re-authorizing the Act for seven more years of funding (see Public Law
    106-559, section 202). Now is the time to follow through on this long
    promised funding and provide actual funding under the Indian Tribal
    Justice Act!
                                   conclusion
        Tribal justice systems are the primary and most appropriate
    institutions for maintaining order in tribal communities. They are the
    keystone to tribal economic development and self-sufficiency. Any
    serious attempt to fulfill the Federal Government's trust
    responsibility to Indian Nations must include increased funding and
    enhancement of tribal justice systems.
        We welcome the opportunity to comment on the Justice Department
    funding of the Indian Country Law Enforcement Initiative and the Indian
    Tribal Justice Technical and Legal Assistance Act of 2000 (Public Law
    106-559).
        Thank you very much.
                                     ______

         Prepared Statement of the National Center for Victims of Crime

        My name is Susan Herman, and I am the executive director of the
    National Center for Victims of Crime. I submit this testimony to urge
    members of the Subcommittee on Commerce, Justice, State and the
    Judiciary to remove the cap on the Victims of Crime Act (VOCA) Fund and
    allow all money in the Fund to be obligated according to statutory
    formula. In addition, I urge you to prevent the addition of new
    earmarks off the top of the VOCA Fund.
        The National Center for Victims of Crime is the nation's largest
    nonprofit advocacy and resource organization serving victims of all
    crime. Since its founding in 1985, the National Center has worked with
    nearly 10,000 public and private non-profit organizations and agencies
    across the country, and has provided information, support, and
    technical assistance to hundreds of thousands of victims, victim
    service providers, allied professionals, and advocates.
        As you may know, the VOCA Fund was created by Congress in 1984 to
    provide Federal support to the many state and local programs that
    assist victims of crime. The VOCA Fund is derived entirely from fines
    and penalties on offenders at the Federal level, and the bulk of the
    Fund is distributed to the States through a formula grant. The State
    money is split between the crime victim compensation programs, which
    pay many of the out-of-pocket expenses of victims, and victim services
    such as rape crisis centers, domestic violence shelters, victim
    assistants in law enforcement and prosecutor offices, and other direct
    services to victims of crime. Under the VOCA formula, States have four
    years to spend a given year's distribution, giving them adequate time
    to plan for the most effective use of this money.
        For the past two years, through the appropriations process, the
    amount of money available to the States has been capped at
    approximately $500 million, despite collections of over $1 billion.
    Removing the cap on the VOCA Fund, allowing that money to be put to the
    purpose for which Congress originally intended it, would make a
    tremendous difference to crime victims nationwide.
        The National Center hears from victim service providers every day
    about the significant unmet needs in every corner of the country. Some
    examples of this need include:
      --Victim assistant positions in law enforcement agencies.--Most
            police agencies have no crime victim assistant, who can make
            sure victims receive appropriate referrals, are informed about
            the availability of crime victim compensation, and help answer
            victims' questions about the status of their case. Unless such
            a position exists at the law enforcement level, victims whose
            cases do not result in an arrest and charging will be deprived
            of any system-based services.
      --Services to immigrant victims of crime.--All over the country,
            there are limited services, or a even complete absence of
            services, for large groups of immigrant victims of crime. Such
            victims are often linguistically or culturally isolated.
            Without the availability of interpreters, such victims cannot
            access the services that may otherwise be available.
            Additionally, victims who come from a society where the police
            are not trusted, or where sexual violence is unmentioned or
            domestic violence is condoned, often require a different
            approach to providing services. Effective victim services
            require ready access to service providers who are culturally
            knowledgeable and sensitive to these varying needs.
      --Services to victims in rural jurisdictions.--While every State
            provides services to victims of crime, too many victims in
            rural jurisdictions still lack access to basic services. In
            many parts of the country, victims are hundreds of miles from
            the nearest rape crisis center or battered women's shelter.
      --Assistance to victims with disabilities.--One area of greatest need
            is in reaching and serving crime victims with disabilities--
            developmentally disabled victims, mentally ill victims, hearing
            impaired victims, and others whose disability makes them
            simultaneously more vulnerable to crime and less able to access
            existing services.
        In addition to those services, many States have a need to fund one-
    time expenses, which are unlikely to be funded without a large influx
    of money. A few examples include:
      --Automated notification systems.--Many States would like to
            implement automated crime victim notification systems, that
            automatically telephone crime victims when defendants are
            released or escape, or send written notice of criminal justice
            proceedings. These systems require significant design and
            development funds, but far less money to maintain after that.
            Automated notification systems are especially important for
            domestic violence, sexual assault, and stalking victims, who
            are often at risk when a defendant is released. Such systems
            also make it easy for women to update their contact information
            as they relocate.
          An automated notification system would make it easier to extend
            legal rights to victims of domestic violence and stalking in
            the States that don't currently provide such rights now. Many
            State victims' bills of rights apply only to victims of
            felonies. Domestic violence is often charged as a misdemeanor.
            The criminal justice system often argues that it would be too
            expensive to provide rights to victims of misdemeanors, largely
            due to costs involved in notifying victims of releases and
            court proceedings. Once an automated notification system is in
            place, it is relatively inexpensive to include domestic
            violence victims in crime victims' bills of rights.
      --Statewide victimization surveys and needs assessments.--A number of
            States would like to conduct a statewide victimization survey
            and needs assessment to more clearly identify which
            jurisdictions and victim populations are underserved, and how
            best to allocate resources. With the pressure to fund existing
            programs each year, there hasn't been the ``extra'' money to
            set aside for such surveys that would lead to greater
            efficiency and more appropriate services for victims of crime.
      --Translation services.--Victim assistance programs are acutely aware
            of the need for translation services that would allow non-
            English speaking victims to access services. The translation of
            written materials, the development of public service
            announcements in other languages, and the creation of programs
            to identify interpreters would help reach this underserved
            population.
      --Other investments to enhance victim services.--There are many other
            important funding needs for victim programs that do not involve
            new programs or hiring additional staff. Many victim services
            programs do not have computers, or have no Internet access.
            This technology would improve their capacity to serve victims
            of crime. There is also a great need for case management
            software and assessment tools to help programs improve and
            evaluate their effectiveness in serving victims of crime. Money
            to develop those tools would largely be a one-time expenditure.
        We understand that because the VOCA Fund fluctuates from year to
    year, there is some concern that extra money available one year would
    simply mean the creation of new positions that can't be sustained.
    There is certainly a need to expand programs that provide direct
    assistance to victims of crime, and part of any increase in funding
    would likely be directed to that need. However, as described above,
    there are also many important projects--projects that do not involve
    the creation of new permanent staff positions or ongoing expenses--that
    States could fund with a significant but non-recurring increase in
    funds.
        Moreover, States have the ability to plan for financial stability
    over time. Under the VOCA formula, States have four years to spend a
    given year's allocation, so States can plan their spending to provide
    stability over a few years. Fluctuations in funding levels is a problem
    the States should solve, not the Federal Government. In addition, as
    described above, there are many one-time expenses the influx would be
    applied to.
        Moreover, there is no reason to believe collections for the VOCA
    Fund will drop for a prolonged period. Though deposits into the VOCA
    Fund do vary from year to year, the general trend has been an increase
    in the amount of money in the Fund. Again, the bulk of the money
    deposited in the VOCA Fund comes from fines on offenders at the Federal
    level. Why should we expect the Department of Justice to become less
    vigilant in its prosecution of Federal crimes?
        All of these reasons mitigate against the fear that removing the
    cap on the VOCA Fund would result in a significant increase in staff
    positions that would have to be cut the following year.
        We also urge you to discontinue earmarks for Federal positions off
    the top of the VOCA Fund. In the past two years, in addition to the
    cap, the appropriations process has resulted in new, permanent open-
    ended earmarks for victim assistance positions in U.S. Attorneys'
    Offices and the Federal Bureau of Investigation. This, too, limits the
    amount of money available for its intended purposes, which is the
    support of crime victim assistance at the State level. These positions
    may be warranted, but surely Congress can find other sources of revenue
    to support Federal employees.
        The most important action Congress can take to help this nation's
    victims of crime is to provide the funding for services and
    compensation programs that help them rebuild their lives. Congress'
    creation of the VOCA Fund in 1984 was a landmark action that
    fundamentally changed the way our society responds to victims of crime.
    We urge you to continue this great effort, by removing the cap on the
    VOCA Fund, and resisting pressure to earmark Federal positions from the
    Fund. We must continue the progress of our national response to victims
    of crime.
                                     ______

           Prepared Statement of the California Indian Legal Services

        Thank you, Mr. Chairman, for this opportunity to address you and
    the distinguished members of this Subcommittee. On behalf of California
    Indian Legal Services, I am pleased to submit this written testimony on
    the fiscal year 2002 Appropriations for Department of Justice funding
    of the Indian Tribal Justice Technical and Legal Assistance Act of 2000
    (Public Law 106-559).
        California Indian Legal Services (CILS) is a non-profit entity, as
    defined under section 501(c)(3) of the Internal Revenue Code of 1986,
    which provides free legal assistance services for Indian tribes as well
    as their members. CILS was created by California Indian leaders in 1967
    to redress the severe inequities that existed in California at that
    time and that persist to today. California is home to more Indian
    nations than any other state; most of whom have little natural or
    financial resources and must rely on CILS to address most, if not all,
    of their legal needs. California is also second only to Oklahoma in the
    number of Native Americans residing within its borders.
        Total Federal funding under the Legal Services Corporation Act to
    provide free legal services in California to Indian tribes that cannot
    afford to hire attorneys, as well as tribal members, is approximately
    $800,000 per year. Adjusted for inflation, this amounts to only one-
    quarter of the funding that Congress originally allocated for this
    purpose over thirty years ago.
        Each year, CILS provides a broad array of civil legal assistance to
    over 50 Indian tribes and over 3,000 Indian families in California. The
    gulf between the community need and available resources means that
    California Indian tribes and CILS must often sacrifice intensive, time-
    consuming, but necessary projects in order to address more immediate
    problems. Department of Justice funding for Tribal Civil Legal
    Assistance Grants under section 102 of the Act would allow Indian
    tribes and Indian legal services providers like CILS to partially break
    this cycle and focus on a long-standing, critical community need for
    tribal justice systems.
        The lack of tribal courts has constrained the ability of tribal
    governments to fully exercise their inherent sovereignty and Indian
    individuals and tribes are often unable to resolve disputes or seek
    justice. While Indian tribes in California retain exclusive
    jurisdiction, most have neither the resources nor the forum to exercise
    such jurisdiction. Without tribal courts, many disputes fall within a
    jurisdictional vacuum, or can only be litigated in Federal courts
    located hundreds of miles away. The former can be especially
    devastating to a tribal community when the vacuum leads to political
    paralysis. For example, where there have been disputes over the conduct
    of tribal elections, the lack of dispute resolution systems has brought
    tribes and the operation of their governments to a standstill.
        Among the various disputes that may arise in Indian country, the
    Federal courts only have the power to review certain tribal court
    decisions, but lack jurisdiction to hear disputes in the first
    instance, and state courts will have no jurisdiction whatsoever. Thus,
    there often is no alternative forum. Also, Indian tribes have broad
    regulatory authority over their members on the reservation and more
    limited regulatory authority over non-members within their reservation.
    Tribes have the authority to regulate their reservations and so enact
    laws concerning many varied matters, including the environment, water
    quality, utilities, land use, traffic, zoning, liquor, and animal
    control. Without tribal courts, however, tribes are denied effective
    recourse when their regulatory laws are violated. Thus, without tribal
    courts, California Indian tribes face great difficulty enforcing their
    own laws.
        Individual Indians, too, are harmed by the lack of tribal justice
    systems and inadequate resources for free civil legal assistance in
    such systems. Without some dispute resolution system, Indian
    individuals often lack any forum to which they can bring their disputes
    involving Indian real property or matters involving federally-
    guaranteed hunting, fishing and trapping rights. Moreover, they are
    denied the opportunity, granted to other Indian people in the nation,
    to bring their internal disputes to a culturally accessible court.
    Although Public Law 280 grants state courts adjudicatory authority over
    many disputes arising on the reservation, many Indian people do not
    feel comfortable bringing their cases to state court, where they often
    encounter a difficult and alienating experience. Moreover, some
    disputes involving matters exclusively within tribal jurisdiction, such
    as tribal enrollment or elections, and governed by tribal law cannot be
    heard in state court.
        Studies conducted by Federal, State, and private agencies over the
    past 100 years have reached the same conclusion; Indians in California
    are not receiving a fair share from Federal Indian programs; and
    because they have received less support from the Federal Government,
    California Indians have suffered greater devastation in social-economic
    well-being relative to other Indian groups in other states. The well-
    documented reports reaching this conclusion have come from both
    Republican and Democratic administrations, and from non-profit and
    tribal organizations. The most recent study commissioned by Congress
    revealed that in 1994 per capita BIA spending in California was one-
    quarter of that for the rest of the country as a whole.
        Due to the lack of adequate funding for California Indians, most
    California Indian tribes lag behind their counterparts in other states
    in the development of tribal justice systems. While Congress has
    appropriated funding for other tribal court development programs
    administered by the Department of Justice, those programs often require
    a stage of development that was and remains unattainable by most
    California Indian tribes with their present resources. Appropriations
    for the Indian Tribal Justice Technical and Legal Assistance Act of
    2000 will allow California Indian tribes and other similarly situated
    Indian tribes located throughout the United States to obtain the
    assistance that they need in order to meet the prerequisites of other
    tribal justice grant programs.
        We commend Congress for recognizing the vital importance of tribal
    justice systems and their integral roles in tribal self-governance. We
    also thank Congress for recognizing the established record of Indian
    legal services programs in providing cost effective legal assistance to
    Indian people in tribal court forums and in making significant
    contributions to the development of tribal courts and tribal
    jurisprudence. We urge Congress to take the next crucial step and
    appropriate adequate funding so that the tribal justice needs of Indian
    tribes, in California and throughout the United States, will no longer
    be neglected.
                                     ______

                    Prepared Statement of Clemson University

        Mr. Chairman, Mr. Ranking Member, and members of the Subcommittee,
    as President of Clemson University, I would like to draw to your
    attention two initiatives directed by Clemson's Institute on Family and
    Neighborhood Life, and I ask you to consider an appropriation for each.
                 consortium on children, families, and the law
        Clemson University respectfully requests $3.0 million in fiscal
    year 2002 from the Office of Juvenile Justice and Delinquency
    Prevention to Clemson University for a collaborative effort involving
    the 15 centers of the Consortium on Children, Families, and the Law to
    conduct research and provide technical assistance and training on (a)
    the prevention and treatment of youth violence; (b) innovations in
    juvenile justice policy; (c) alternatives to and improvements in the
    juvenile courts; and (d) State laws, policies, and programs relating to
    children, families, and the law.
        Although recent statistics indicate a decline in rates of juvenile
    violence, each year several million children come into contact with the
    juvenile justice system as juvenile offenders, victims of crime, or
    both. There remains a tremendous need to assist States, communities,
    and the Federal Government in preventing youth violence and responding
    effectively to youth and their families in the legal system.
        To address these issues, a network of uniquely qualified
    institutions across the country is needed to assist States,
    communities, law enforcement agencies, and the Federal Government by
    evaluating and disseminating violence prevention programs that have a
    demonstrated track record, assessing the impact of policies and
    practices currently guiding the juvenile justice system, and conducting
    research demonstrations and interstate comparisons on innovative
    juvenile justice policy and practice.
        The Consortium on Children, Families, and the Law provides a ready
    network to conduct interdisciplinary, multi-State research and
    consultation on issues affecting children and the law. With its
    geographic diversity and nationally-recognized researchers, the
    Consortium is in a position to be able to build and disseminate
    knowledge quickly and broadly. Member centers of the Consortium are
    located at Clemson University (the hub of the Consortium), Creighton
    University (Omaha, NE), the Medical University of South Carolina, the
    University of Iowa, the University of Hawaii-Manoa, the University of
    Nebraska-Lincoln, the University of New Hampshire, the University of
    Pennsylvania, the University of Pittsburgh, the University of South
    Carolina, and the University of Virginia. Affiliate members of the
    Consortium include the American Bar Association's Center on Children
    and the Law, the Public Interest Directorate of the American
    Psychological Association, and the Youth Law Center.
        A primary activity proposed by the Consortium on Children,
    Families, and the Law for work in fiscal year 2002 is expansion of the
    Bullying Prevention Program, which is aimed at reducing bullying and
    related antisocial behaviors among elementary and middle school
    children.
        Past research by members of the Consortium on Children, Families
    and the Law (Clemson University, University of South Carolina) confirms
    that bullying among school children is a significant problem in the
    United States. One in four reported having been bullied with some
    regularity (at least several times per month); one in 10 reported
    having been frequently bullied--once a week or more.
        The negative effects of bullying on children are well documented.
    Bullying has been shown to lead to higher rates of depression, illness,
    absenteeism, suicidal ideation, and lower self-esteem among victims.
    Moreover, a recent study conducted by the U.S. Secret Service suggests
    that bullying has been a precursor to several incidents of school
    shootings. Children who bully need prompt attention to ensure that
    these behaviors do not continue or escalate into more serious forms of
    antisocial behavior.
        To date, one program model has been documented to be successful in
    reducing bullying among school children. The Bullying Prevention
    Program, developed by Norwegian psychologist Dan Olweus, has been found
    to reduce bullying by 20-50 percent and to reduce the likelihood of
    children engaging in other types of antisocial behavior.
        Faculty at Clemson University and at the University of South
    Carolina led the first wide-scale implementation and evaluation of the
    Bullying Prevention Program in the United States. Initial evaluations
    of this program within middle school settings in South Carolina were
    very promising and contributed to the recognition of the program as one
    of 11 national ``Blueprints for Violence Prevention'' by the Center for
    the Study and Prevention of Violence at the University of Colorado and
    as an Exemplary Program by the Centers for Substance Abuse Prevention
    (CSAP). Members of the Consortium have provided consultation to over 30
    schools in a number of States (Colorado, Georgia, Maine, Massachusetts,
    Montana, Pennsylvania, South Carolina, and Virginia) to implement the
    Bullying Prevention Program.
        Funding to the Consortium on Children, Families, and the Law from
    the Office of Juvenile Justice and Delinquency Prevention would allow
    us to:
      --More widely disseminate the highly-successful Bullying Prevention
            Program.--We currently are unable to adequately meet the
            growing demand from schools to implement this program because
            of a lack of qualified trainers. Funding would assist us to
            provide training and follow-up consultation to trainers from
            across the United States who could respond to calls for
            training and technical assistance from school sites. It also
            would allow us to help interested schools to cover additional
            costs associated with the implementation of the program (eg.,
            materials and staff time).
      --Continue efforts to evaluate the effectiveness of the program in
            elementary school settings.--Findings from our earlier
            evaluation of the program in middle school settings suggested
            that the program would be most effective if implemented in
            elementary schools in the U.S. Research is needed to
            systematically evaluate the program in elementary schools, with
            particular focus on those factors that affect the
            successfulness of the program in different settings. Such
            information will be vital to efforts to effectively disseminate
            this model.
             national center on rural justice and crime prevention
        Clemson University also is requesting an appropriation of $500,000
    from the Bureau of Justice Assistance to support the National Center on
    Rural Justice and Crime Prevention. Although crime and violence rates
    have generally been declining throughout the country since 1994,
    dramatic social and economic changes in rural life in the last 20 years
    place many rural areas and small towns at risk of increasing crime and
    violence rates. From 1993-1998, violent and property crime rates in
    rural areas decreased much more slowly than in urban and suburban
    areas. Moreover other key indicators of community well-being, including
    poverty rates, educational attainment, economic growth, and teenage
    pregnancy rates, suggest that many rural areas and small towns are
    increasingly vulnerable to conditions that appear to undermine
    community safety.
        Because rural communities and small towns have been virtually
    ignored by many policymakers and researchers, relationships among
    factors that are thought to contribute to changes in rural crime and
    violence rates (e.g., migration in and out of communities; poverty;
    economic changes; and changes in family structure, etc.) are not well
    understood. For example, some evidence exists to suggest that rapid
    population growth in rural communities causes an increase in crime and
    violence rates at 3 to 4 times the rate of growth. However, the reasons
    why rapidly growing communities would experience such an increase in
    crime and violence are not clear. As a result, implementation of
    effective crime and violence prevention and reduction strategies in
    these communities is much more difficult. Similarly, very little
    attention has been given to the impact of regional differences, such as
    the clustering of poverty in several Southern rural counties, on crime
    and violence rates. Yet, community conditions, such as poverty,
    changing family structures, and the strength or weakness of key
    community institutions (e.g., schools, faith-based organizations, civic
    groups, etc.) are likely to affect the capacity of citizens to coalesce
    around a shared agenda of crime and violence prevention. Generating and
    sharing knowledge about crime and violence in the context of the unique
    elements of rural life is important to developing policies and
    programmatic strategies that are likely to be effective in rural areas.
        Since its creation in 1999, the National Center on Rural Justice
    and Crime Prevention (NCRJ) at Clemson University has worked in
    partnership with rural communities to generate knowledge about
    community-based problem-solving strategies for preventing and reducing
    crime and violence and to learn more about the adaptability of
    community justice models to rural areas. The knowledge generated has
    helped inform the technical assistance efforts to rural communities
    nationwide. In the short life of the NCRJ, technical assistance has
    been provided to organizations in more than 26 States, including rural
    schools about youth violence; law enforcement, the judiciary, and
    prosecutors about community-justice related strategies; social service
    agencies about domestic violence and child abuse and neglect; health
    agencies about community safety; and neighborhood resource centers
    about strategies for strengthening families in the justice system.
        This request for $500,000 in funding will enable the NCRJ to expand
    project sites to other States and to further develop a base of
    knowledge about the effect of changing conditions in rural communities
    on crime and violence rates. It will also enable NCRJ faculty to
    develop a more comprehensive package of technical assistance ``tools''
    for use by practitioners.
        Thank you for the opportunity to present this statement for the
    record.
                                     ______

            Prepared Statement of the City of Fairfield, California

        Mr. Chairman and members of the Commerce, Justice, and State
    Subcommittee on Appropriations, thank you for this opportunity to
    testify before this Committee. My name is George Pettygrove and I am
    the mayor of the City of Fairfield, California. On behalf of the
    citizens of Fairfield, I request your support of one of the City's
    highest Federal priorities for the fiscal year 2002.
        The City of Fairfield, California, requests your support of a
    $500,000 earmark in the fiscal year 2002 Department of Justice
    Appropriations Bill under the COPS Technology Program for the technical
    infrastructure associated with the new Solano County Regional Law
    Enforcement Training Center.
        Law enforcement agencies in Solano County and Napa County are
    experiencing a gradual degradation of training facilities as a result
    of urban development. In response, law enforcement agencies within both
    counties are planning a new facility in an area unlikely to be
    encroached upon for at least 25 years.
        Federal funds will focus on technology for the new facility,
    including a firearms simulator, driving simulators, smartboard
    technology, weaponless defense training materials, and targeting
    systems for four ranges.
        A joint powers authority (JPA), consisting of the cities of
    Fairfield, Benicia, Vallejo, and Napa County is being formed to move
    the project forward. JPA participants anticipate additional
    jurisdictions will join the JPA in light of the lack of proper law
    enforcement training facilities in the region. The JPA has identified
    $2.5 million in matching funds for the $5.5 million project.
        Once again, thank you for this opportunity to testify before this
    Committee.
                                     ______

            Prepared Statement of the Center Directors' Association

        The Regional Information Sharing Systems (RISS) Program
    respectfully requests that Congress appropriate for fiscal year 2002,
    $38.5 million to continue their support in combating drug trafficking
    and organized crime.
        These funds will enable RISS to continue identifying, targeting,
    prosecuting, and removing criminal conspirators involved in drug
    trafficking, organized criminal activity, criminal gangs, and violent
    crime that span multijurisdictional boundaries. Funds will allow RISS
    to continue to support the investigation and prosecution efforts of
    over 5,600 local, State, and Federal law enforcement member agencies
    across the nation comprising over 600,000 sworn law enforcement
    personnel.
        Through funding from Congress, RISS has implemented and operates
    the only secure Web-based nationwide network--called riss.net--for
    communications and sharing of criminal intelligence by local, State,
    and Federal law enforcement agencies. Funds will allow RISS to upgrade
    the technology infrastructure and resources to support increased use
    and reliance on the system by member law enforcement agencies and
    support the integration of other systems connected to riss.net for
    information sharing and communication. Using Virtual Private Network
    technology, the law enforcement users access the public Internet from
    their desktop and have a secure connection over the private riss.net
    Intranet to all RISS criminal intelligence databases and resources.
    RISS member law enforcement agencies accessed riss.net an average of
    2.7 million times per month during fiscal year 2000. Riss.net is a
    proven, highly effective system that improves the quality of criminal
    intelligence information available and puts it in the hands of the law
    enforcement officers to make key decisions at critical points in their
    investigation and prosecution efforts.
        The Office of Justice Programs (OJP), Regional Information Sharing
    Systems (RISS) is a Federally funded program comprised of six regional
    intelligence centers. The six centers provide criminal information
    exchange and other related operational support services to local,
    State, and Federal law enforcement agencies located in all fifty
    States, the District of Columbia, U.S. territories, Canada, England,
    and Australia. These centers are:
        Middle Atlantic-Great Lakes Organized Crime Law Enforcement Network
    (MAGLOCLEN): Delaware, District of Columbia, Indiana, Maryland,
    Michigan, Pennsylvania, Ohio, New Jersey, and New York, as well as
    Canada and England.
      --Mid-States Organized Crime Information Center (MOCIC).--Illinois,
            Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota,
            South Dakota, and Wisconsin, as well as Canada.
      --New England State Police Information Network (NESPIN).--
            Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island,
            and Vermont, as well as Canada.
      --Regional Organized Crime Information Center (ROCIC).--Alabama,
            Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi,
            North Carolina, Oklahoma, South Carolina, Tennessee, Texas,
            Virginia, and West Virginia, as well as Puerto Rico and the
            U.S. Virgin Islands.
      --Rocky Mountain Information Network (RMIN).--Arizona, Colorado,
            Idaho, Montana, Nevada, New Mexico, Utah, and Wyoming, as well
            as Canada.
      --Western States Information Network (WSIN).--Alaska, California,
            Hawaii, Oregon, and Washington, as well as Canada, Guam, and
            Australia.
        RISS is a force multiplier in fighting increased violent criminal
    activity by street gangs, drug traffickers, sophisticated cyber
    criminals, and emerging criminal groups that require a cooperative
    effort by local, State, and Federal law enforcement. There is a rising
    presence of organized and mobile narcotics crime, distinguished by
    increases in drug-related emergency room incidents, increases in drug
    purities (especially heroin, methamphetamine, ecstasy, cocaine, GHB,
    and marijuana), and increasing communications sophistication by the
    criminal networks. Inter-agency cooperation has proven to be the best
    method to combat the increasing criminal activity in these areas. The
    RISS centers are filling law enforcement's need for rapid, but
    controlled sharing of information and intelligence pertaining to known
    or suspected drug traffickers and criminals. Congress funded the RISS
    Program to address this need as evidenced by its authorization in the
    Anti-Drug Abuse Act of 1988.
        The success of RISS has been acknowledged and vigorously endorsed
    by the International Association of Chiefs of Police (IACP), as well as
    other national law enforcement groups such as the National Sheriff's
    Association (NSA) and the National Fraternal Order of Police (NFOP).
    These groups have seen the value of this congressional program to law
    enforcement nationally and have worked with the National Association of
    Attorneys General (NAAG), the National District Attorneys Association
    (NDAA), and the National Criminal Justice Association (NCJA) to further
    strengthen the awareness of RISS. In fact, the National Association of
    Attorneys General passed a resolution calling for full funding for RISS
    and increased funding for the Bureau of Justice Assistance (BJA).
        According to the Executive Working Group for Federal-State-Local
    Prosecutorial Relations, in its publication titled, Toward a Drug Free
    America: A Nationwide Blueprint for State and Local Drug Control
    Strategies, ``Each State should develop a computerized capacity to
    store, collate, and retrieve intelligence and historical information
    concerning drug offenders. Before initiating new computer projects,
    each State should take advantage of existing computerized information
    exchange and pointer systems, such as the Regional Information Sharing
    Systems (RISS). Each State should actively participate in multi-State,
    regional, and national information networking projects.''
        RISS is operating current state-of-the-art technical capabilities
    and systems architecture that allow local, State, and Federal law
    enforcement member agencies to interact electronically with one another
    in a secure environment. The RISS system has built-in accountability
    and security. The RISS secure Intranet (riss.net) protects information
    through use of encryption, smart cards, Internet protocol security
    standards, and firewalls to prevent unauthorized access. The RISS
    system is governed by the operating principles and security and privacy
    standards of 28 CFR Part 23 (Criminal Intelligence Systems Operating
    Policies). The technical architecture adopted by RISS requires proper
    authorization to access information, but also provides flexibility in
    the levels of electronic access assigned to individual users based on
    security and need-to-know issues. Riss.net supports secure e-mail and
    is easily accessible using the Internet. This type system and
    architecture is referenced and recommended in the General Counterdrug
    Intelligence Plan (GCIP).
        The GCIP promotes Federal, State, local and tribal law enforcement
    information sharing, and leveraging resources and existing cooperative
    mechanisms. RISS fully supports the GCIP and the following initiatives
    are underway related to action items in the Plan. RISS has entered into
    a partnership with the High Intensity Drug Trafficking Areas (HIDTA) to
    electronically connect the HIDTAs to riss.net for communications and
    information sharing. Currently 11 HIDTAs are electronically linked to
    riss.net, with 7 more pending connection during 2001. Six State
    agencies are also electronically connecting their systems to riss.net.
    The National Drug Intelligence Center (NDIC) is a member of RISS and
    uses the RISS network as a communications mechanism for publishing
    counterdrug intelligence products to Federal, State, and local law
    enforcement members. RISS and the El Paso Intelligence Center (EPIC)
    officials have entered into a partnership to electronically connect
    EPIC to riss.net to capture clandestine laboratory seizure data from
    RISS State and local law enforcement member agencies. RISS needs funds
    to purchase hardware and software to support and integrate these
    systems that improve the accessibility to critical criminal
    intelligence for law enforcement agencies throughout the country.
        RISS continues to promote inter-agency investigations by improving
    capabilities for member agencies to quickly and easily access RISS
    databases by expanding the enrollment of member agencies for access to
    riss.net through distribution of security hardware and software. Web
    browser technology has been implemented for use by member agencies in
    accessing the RISS intelligence database pointer system and the RISS
    National Gang Database. At the direction of Congress, dial-up (800)
    access capability to the RISS secure intranet will be provided for
    member agencies in geographic areas where access to Internet Service
    Providers is not available. Funds are required to increase the
    distribution of security hardware and software to additional RISS
    member agencies that need electronic access to riss.net.
        In fiscal year 2001, Congress invested $25 million in the RISS
    Program. RISS has received level funding of $25 million for the past 5
    fiscal year funding cycles ($20 million in the line item and $5 million
    from COPS except for fiscal year 2001 when the line item was raised to
    $25 million with no allocation from COPS). During the past 5 fiscal
    year funding cycles and up to the current time, RISS has furnished case
    specific support to hundreds of local and state police, as well as
    sheriff departments. These investigations have had an unrivaled impact
    on the local jurisdictions of main street America, the grass roots of
    law enforcement in the nation. During this same time period, RISS
    implemented the secure intranet providing Web-based access for
    communications and information sharing to over 5,600 law enforcement
    agencies nationwide--a network which is now electronically linked to 11
    HIDTAs (with 7 more pending connection), six State law enforcement
    systems, and the EPIC Clandestine Laboratory Seizure System. The
    Southwest Border States Anti-Drug Information System (SWBSADIS)
    initiative encompassing the States of Arizona, California, New Mexico,
    and Texas is also integrated with riss.net. RISS is currently working
    to connect the Bureau of Land Management, Department of Interior, to
    riss.net. To support this increased need to integrate other systems and
    the increased demand for RISS services, RISS is requesting an increase
    in funding to $38.5 million for fiscal year 2002.
        In view of today's increasing demands on Federal, State, and local
    law enforcement budgets, requests for RISS services have risen. The
    Institute for Intergovernmental Research (IIR) report on the RISS
    Program showed that as of December 31, 2000, the number of criminal
    subjects maintained in the RISSIntel intelligence databases for all
    centers combined was 790,241 with 190,159 new subjects being added in
    2000. The combined databases of all six RISS centers also maintained
    data on 1,357,450 locations, vehicles, weapons, and telephone numbers
    for a grand total of 2,147,691 data entries available for search. For
    the twelve-month period January through December 2000, the total number
    of inquiries by law enforcement member agencies to the RISSIntel
    database for all six regional intelligence centers combined was
    707,457. These inquiries resulted in hits or information to assist law
    enforcement agencies in their criminal cases. All RISS centers combined
    delivered 9,346 analytical products to member agencies in support of
    their investigation and prosecution efforts in 2000.
        This support of law enforcement has had a dramatic impact on the
    success of their investigations. Over the three-year period 1998-2000,
    RISS generated a return by member agencies that resulted in 12,510
    arrests, seizure of narcotics valued over $246 million, seizure of
    almost $14 million in currency, and recovery or seizure of property
    valued at over $32 million. In addition, more than $11 million was
    seized through RICO civil procedures. In the 20-year period since 1980
    when the Program was fully implemented, the RISS Program has assisted
    its member agencies with their investigations. Results of these
    investigations have amounted to well over $12 billion in recoveries at
    a total cost that approximates 2.44 percent of that amount, or a $41
    return for every dollar spent.
        RISS is continuing initiatives with the Federal Bureau of
    Investigation and with the Bureau of Alcohol, Tobacco and Firearms,
    U.S. Department of the Treasury to assist in their efforts to
    facilitate the exchange of criminal intelligence with State and local
    law enforcement. RISS continues to work with Federal and State
    corrections departments to strengthen cooperation and information
    sharing with the law enforcement community, and to maintain a national
    prison gang database to identify prison gang criminal activity, both
    within and outside the prison environment. We have established a
    working relationship with gang investigators across the nation to
    identify and maintain information on violent street gangs, as well as
    their membership, organization structure, migration trends, and their
    propensity for violence.
        RISS has also assisted the Office of Juvenile Justice and
    Delinquency Prevention, and continues to work with Federal, State, and
    local agencies in their efforts to combat the menace of drugs on our
    street, and the growing influence of youth gangs in the distribution
    and sale of drugs.
        The Bureau of Justice Assistance administers the RISS Program and
    has established guidelines for provision of services to member
    agencies. The RISS regional intelligence centers are subject to
    oversight, monitoring, and auditing by the U.S. Congress, the General
    Accounting Office, a Federally funded program evaluation office; the
    U.S. Department of Justice, Bureau of Justice Assistance; and local
    government units. The Intelligence Systems Policy Review Board also
    monitors the RISS centers for 28 CFR Part 23 compliance. This 28 CFR
    Part 23 regulation places stricter controls on the RISS intelligence
    sharing function than those placed on Federal, State, or local
    agencies. Evaluation of RISS center operation has been very positive.
        A new authorization and full funding of the RISS Program is
    necessary in order to permit membership growth and improve services
    capabilities to the membership nationwide. In the past five years, RISS
    membership has increased 20 percent to over 5,600 local, State, and
    Federal law enforcement agencies at present. It is respectfully
    requested that the Congress fully fund the RISS Program as a line item
    in the congressional budget, in the requested amount of $38.5 million.
    Local and State law enforcement, who depend on the RISS centers for
    information sharing, training, analytical support, funding, and
    technical assistance, are anticipating increased competition for
    decreasing budget resources. It would be counterproductive to require
    the RISS members from State and local agencies to self-fund match
    requirements, as well as to reduce the amount of BJA discretionary
    funding. The State and local agencies require more, not less, funding
    to fight the nation's crime/drug problem. The RISS Program cannot make
    up the decrease in funding that a match would cause and it has no
    revenue source of its own. Cutting the RISS appropriation by requiring
    a match should not be imposed on the program.
        We are grateful for this opportunity to provide the committee with
    this testimony and appreciate the support this committee has
    continuously provided to the RISS Program.
                    the regional information sharing systems
        To assist the RISS centers in implementing this program, the U.S.
    Department of Justice, Office of Justice Programs, Bureau of Justice
    Assistance worked with the centers to institute the following
    components.
      --Information Sharing Component.--Every center will maintain and
            operate either a manual and/or automated information-sharing
            component that is responsive to the needs of participating
            enforcement agencies in addressing multi-jurisdictional
            offenses and conspiracies. This component must be capable of
            providing controlled input, dissemination, rapid retrieval, and
            systematic updating of information to authorized agencies.
      --Analytical Component.--Every center will establish and operate an
            analytical component to assist the center and participating
            agencies in the compilation, interpretation, and presentation
            of information provided to the center. This component must be
            capable of responding to participating agency requests for
            analysis of investigative data.
      --Telecommunications Component.--Centers may establish and/or
            maintain a telecommunications system designed to directly
            support the operation of the information sharing component and
            analytical component, and to support center sponsored
            investigations and activities.
      --Investigative Support Component.--Centers may establish and operate
            an investigative support component by providing financial
            assistance to participating agencies for their conduct of
            multi-jurisdictional investigations. Financial resources may
            include funds for the purchase of information, contraband that
            may be used as evidence, services, investigative travel and per
            diem, and overtime compensation. Funds expended and activities
            conducted under this component must directly support the
            operation of the information sharing and analytical components.
      --Specialized Equipment Component.--Centers may establish and
            maintain a pool of special investigative equipment for loan to
            participating agencies. The loan of such equipment must
            directly support the operation of the information sharing and
            analytical components.
      --Technical Assistance Component.--Centers may establish and maintain
            a component to provide technical assistance to member agencies.
            Through use of center personnel and others in participating
            agencies, consultation, advice, and information may be made
            available to member agencies concerning use of specialized
            equipment, investigative procedures, accounting of center funds
            if provided by the center in support of investigations, and
            information analysis. This component will emphasize use of
            technical resources among the centers as necessary and
            available. Technical assistance in the form of active
            participation by center personnel in member agency
            investigations is prohibited.
      --Training Component.--Centers may establish and maintain a training
            component to upgrade investigative skills of personnel from
            participating agencies. Such training assistance may consist of
            financial support to send personnel to training courses,
            seminars, and conferences or, more commonly, design and
            delivery of special training courses by center staff. Training
            provided under this component must support the center goals and
            objectives.
        To further enhance the coordination and exchange of information
    among member law enforcement agencies, the centers have initiated
    additional support service activities including distribution of center
    publications/digests and sponsorship of membership conferences.
                                     ______

             Prepared Statement of the City of Gainesville, Florida

        On behalf of the City of Gainesville, Florida, I appreciate the
    opportunity to present this written testimony to you today. The City of
    Gainesville is seeking Federal funds in the fiscal year 2002 Commerce,
    Justice, State and Judiciary Appropriations bill to assist with the
    following two innovative projects the City is undertaking:
      --The Downtown Revitalization Project to enable economic
            redevelopment in a downtown setting including improving
            stormwater treatment, developing park facilities, enhancing
            alternative transportation and restoring an urban wetland, and
      --The Public Safety Enhancement Project to improve public safety.
                      the downtown revitalization project
        This is a broadly developed, multi-faceted initiative that has an
    established goal of revitalizing Downtown Gainesville. The City of
    Gainesville has experienced a renaissance in establishing Downtown as a
    desirable place to live, work and play. The Initiative encourages the
    redevelopment of existing buildings and parking lots within Downtown
    into mixed residential, commercial, and office uses. Already the City
    has participated in two redevelopment multi-use projects in Downtown
    that have brought in residential, commercial and office spaces. The
    City's participation is providing streetscaping and stormwater
    management, both being vital components of the success of any
    redevelopment initiative. A third redevelopment project under way is
    Alachua County's proposed Judicial Complex and associated parking
    structure.
        The Revitalization Initiative is dependent on a master stormwater
    facility that has been planned as a landmark stormwater park that will
    not only serve as a functional stormwater management facility, but
    provide an urban park setting for Downtown and nearby residents,
    visitors and employees. The stormwater park will also function as a
    Rail Trail Hub to provide linkage of four primary existing and proposed
    rail trail systems.
        The proposed Downtown Connector will connect the Gainesville
    Hawthorne Rail Trail through the stormwater park and is being
    implemented with funding through the Transportation Enhancement
    Program.
        The proposed 6th Street Rail Trail will provide access to the north
    and west through three historic, and predominantly African American
    neighborhoods; Porters, Pleasant Street, and Grove Street. The trail
    and enhanced roadway will provide a primary multi-modal transportation
    corridor connecting the University of Florida and Shands Medical
    Complexes to Downtown.
                                funding requests
        The cornerstones of the City of Gainesville's Downtown
    Revitalization Initiative are the development of the Sweetwater Urban
    Stormwater Park and the reconstruction of Depot Avenue.
      --Sweetwater Urban Stormwater Park.--The Sweetwater Urban Stormwater
            Park component will provide stormwater treatment for Depot
            Avenue, the proposed Rail Trails, as well as the Downtown
            portion of the Sweetwater Branch watershed located upstream of
            the park. The Park is in the planning stages as the centerpiece
            of a U.S. Environmental Protection Agency (USEPA) and Florida
            Department of Environmental Protection funded Brownfields pilot
            project. This project consists of the cleanup costs,
            construction of the stormwater facilities, installation of
            reuse water system for irrigation, and development of the
            recreational components of the Park. The total cost of the
            Sweetwater Urban Stormwater Park is estimated at
            $17,200,000.00. The Federal funding request is for
            $9,700,000.00.
      --Depot Avenue.--This component includes the enhancement of
            approximately two (2) miles of Depot Avenue from SR 331 to US
            441. The Depot Avenue component includes right-of-way
            acquisition and construction activities at a cost of
            approximately $6 million. The enhancement will encourage
            increased utilization of mass transit, bicycle and pedestrian
            modes of travel; increase accessibility to major public
            heritage and recreation destinations for the community; and
            enhance the linkage between Downtown and the University of
            Florida and Shands Medial Complexes.
        The enhancement of Depot Avenue will also provide infrastructure
    and improved safety while accessing Downtown, University of Florida
    area, the adjoining Porters Neighborhood, just west of SR 329 (South
    Main Street) and the SpringHill Neighborhood in Southeast Gainesville.
    The socio-economic conditions of these areas include high crime rates,
    sub-standard housing, and lack of access to services and investment.
                       public safety enhancement project
        This is an innovative crime data gathering, reporting and training
    system to enhance public safety. The goal of this effort is to
    facilitate communication between our urban area public safety and court
    system agencies through the use of system-wide technology upgrades. The
    impact for the entire region is considerable, since this county serves
    as the regional center for much of rural north Florida's medical care,
    disaster management, and criminal justice services.
        For this initiative, the partner urban area public safety agencies
    will need the following: Mobile Lap Top Computers/Data Terminals--$3.5
    million, and System-Wide Communications and GIS Software--$0.8 million.
        The components of this project are designed to work together as a
    well-integrated system to provide improved more effective service to
    the residents of this region. Urban area public safety agencies and
    local criminal justice system agencies will benefit operationally from
    the enhanced data sharing capacities provided by this project.
        Though portions of this project have been attempted by other
    agencies, the Gainesville Police Department will become one of the
    first law enforcement agencies in the state to gather, analyze and
    provide information regarding crime and quality of life type incidents
    in such an efficient, comprehensive and automated manner. The
    activities provided by the infusion of these requested Federal funds
    would enable us to:
      --Establish a region-wide data communications system allowing the
            ready exchange of information between participating agencies.
      --Create a Geographic Information System (GIS) that would enable all
            entities access to an accurate crime analysis and resource
            management tool.
      --Reduce errors and improve information timeliness by implementation
            of an automated incident reporting system.
        The need for laptop computers is partially driven by the Federal
    Government's ``re-farming'' of radio frequencies through the Federal
    Communications Commission. Due to this ``re-farming'' and the high cost
    of radios, many law enforcement officers will no longer have radios
    mounted in department vehicles. The use of laptop computers can fulfill
    the critical need for a second communication device, and at the same
    time help accomplish several other public safety objectives, including
    mobile computer aided dispatch, automated report writing and use of a
    geographic information system (Crime Mapping, etc.).
                         mobile computer aided dispatch
        The advantages gained by utilization of a mobile data system are
    numerous for the law enforcement officer as well as its potential
    ramifications to the public. Removing the reliance on strictly verbal
    communication via a radio and widening the information flow via direct
    data communications, results in an enhancement of the ability to
    successfully resolve problems in the field. Utilizing laptop computers
    as mobile computer aided dispatch terminals significantly increases the
    ability for public safety officers to communicate.
        During critical situations such as a school-shooting incident,
    officers could access information such as floor plans, aerial
    photographs and interior pictures of each school. Detailed information
    regarding each of the public and private schools could be stored on a
    computer disk and made available to and utilized by officers,
    firefighters and ambulance personnel. Information such as this could
    prove to be invaluable regarding how best to approach and/or gain
    access to the school and who to contact in an emergency. The disk would
    contain the names (and photographs) and contact information of
    pertinent school staff as well as important contact information
    regarding hospitals, poison control and hazardous materials.
                        mobile automated report writing
        For generations officers have handwritten reports that are then
    manually filed. The only improvement is that currently a small portion
    of the report is entered into a computer database at some later date.
    However, since the information is compartmentalized it is often entered
    redundantly throughout the criminal justice system. This method of
    capturing the information for reports is antiquated. It takes an
    unnecessary amount of time, wastes valuable resources and provides
    increased opportunities for errors. Benefits realized by the use of
    automated reporting are reduced errors, elimination of data entry
    duplication and more accessible, timely and accurate reports.
                     geographical information system (gis)
        For years law enforcement agencies have tracked crime using pin
    maps to geographically show where crimes occur. This method of tracking
    crime has become impractical and too time consuming for all but the
    smallest of law enforcement agencies. The advent of computerized
    geographical information programs, like ``ArcView'' has enabled law
    enforcement agencies to return to the pin map method of displaying
    crime patterns, but in a much more effective manner. Additionally,
    mapping programs can contain several hundreds of data layers that can
    be utilized by numerous public and private agencies. The following
    objectives are examples of how a GIS system will enable us to use the
    information immediately entered on mobile lap top computers.
      --Electronic Pin Maps (Crime Mapping).--Once a GIS system is
            established, all reports that are generated will be mapped in
            several formats, including calls for service. This enables
            agencies to properly decide where to deploy their limited
            resources. Electronic pin maps also can be time sensitive and/
            or location sensitive. Officers working various shifts can
            identify hot-spots (areas with proportionally higher amounts of
            crime) by time and location. A hot spot during the day, may not
            be a hot spot at night, or visa versa. Additional maps can be
            generated for Uniform Crime Report (UCR) incidents, Crime
            Analysis identified crimes, and calls verified by Florida State
            Statutes. Information that is not immediately available is of
            little or no use when it is entered at a later date. Providing
            timely information to officers and citizens in the form of
            displaying maps with current and historical crime incident
            information is needed so a practical analysis may be done and
            an effective response developed. Unlike pin maps of yesterday,
            electronic mapping allows for the storing historical of data.
            In the past, the map had to be cleared before a new map was
            created. Using electronic mapping, maps can be created and
            stored to allow for comparison over any period of time. Another
            use for the maps, is the identification of locations that have
            repeated calls for service. If a location has had several calls
            for service in a short period of time, a plan can be developed
            to solve the underlining problem and thereby reduce or
            eliminate future calls for service.
      --Management of Resources Utilizing Computer Statistics.--Many law
            enforcement agencies have begun to use a method of management
            which utilizes crime data. Law Enforcement supervisors are
            being held accountable for the level or increase in crime in
            their assigned geographical area. The Gainesville Police
            Department has divided the City into districts. Each District
            Commander is held responsible for the criminal activity and the
            utilization of resources in that geographical area. GIS
            information will be used to better manage the department's
            limited resources.
      --WEB Mapping.--Sharing the information gathered in an effective
            manner is another key component to this process. Many of the
            law enforcement agencies in Alachua County currently have a WEB
            site on the Internet. Increased utilization of WEB based
            services will include making available crime alerts,
            statistics, block summaries, pictures of offenders, crime
            record check and the ability to request copies of reports. This
            access will enable citizens to have information available to
            them in a more convenient and timely manner. In the future,
            crime maps developed by the GIS system will be used to display
            maps over the Internet. Maps will be made available to other
            law enforcement and governmental agencies and the public at
            large.
      --Integration with other Agencies.--In order for a geographical
            information system to be truly effective, it requires the
            cooperation of several agencies. GIS systems with hundreds of
            layers of data can be a useful tool for all the cooperative
            agencies. Law enforcement personnel will be able to view maps
            and aerial or satellite photographs of a given area of the
            city. On top of those maps and/or photographs layers of
            information will be available to all users. Law enforcement
            personnel will provide numerous layers of data to the system
            and will in return be able to access the layers from other
            agencies. Alachua County already has begun the process of
            developing a GIS and the Gainesville Police Department is
            currently working with the University of Florida to develop a
            method of converting data to a format used by ``ArcView''.
        The concept in which pertinent information, including aerial
    photographs, is contained on a computer disk for use by officers with
    laptop computers could be expanded to other potentially critical areas
    such as hospitals, large shopping areas, the airport and the stadium
    and shared with other public safety agencies.
                                     ______

     Prepared Statement of the National, Coordinated Law-Related Education
                                    Program

        I am Lee Arbetman, the Coordinator of the National, Coordinated
    Law-Related Education Program. I am submitting this testimony on behalf
    of Youth for Justice, the National, Coordinated Law-Related Education
    Program (LRE). The National, Coordinated Law-Related Education Program
    received an appropriations earmark for fiscal year 2001 in the amount
    of $1.9 million. The need for the Program continues to substantially
    exceed the Program's resources. Accordingly, for fiscal year 2002, the
    National, Coordinated Law-Related Education Program respectfully
    requests the Subcommittee's appropriations support at a level of $2.4
    million.
        LRE/Youth for Justice is committed to involving young people in
    each state directly in identifying and implementing solutions to this
    nation's epidemic of violence. The program's approach is to teach young
    people about the law so that they can lead their lives within the law.
    In the last decade, the National Program has reached millions of at-
    risk children and trained thousands of teachers, juvenile justice
    counselors and law enforcement officials.
        Law-Related Education, despite its name, has nothing whatsoever to
    do with legal or pre-legal training. The National, Coordinated Law-
    Related Education Program has a proven record of success in juvenile
    delinquency and violence prevention. Law-related lessons reach at-risk
    children and juvenile offenders in school and juvenile justice settings
    in urban, suburban and rural environments. Youth for Justice meets its
    goals by developing and maintaining strong, viable LRE centers in each
    state. The National Program leverages a tiny federal investment, $1.9
    million in fiscal year 2001, many times over in private sector and
    state and local money and in in-kind support from the criminal justice
    and juvenile justice communities.
        The program has two components. The first component of the program
    is INTERVENTION. This part of the program operates primarily in various
    kinds of juvenile justice facilities. In settings ranging from
    detention centers to training schools and after-care, Law-Related
    Education Programs help youth develop problem-solving, conflict
    resolution, and communication skills in the context of engaging lessons
    that focus on personal responsibility.
        The second component, PREVENTION, operates primarily in elementary
    and secondary schools. When you visit a school involved in this
    program, you are very likely to see a teacher, a judge, a lawyer, the
    town's police chief, a law student or a probation officer working with
    a class of students. In some of the best Youth for Justice classrooms,
    police officers co-teach with classroom teachers on a daily basis.
        Assistance from the National, Coordinated Law-Related Education
    program continues to enhance state Law-Related Education programs. For
    example--
        New Hampshire.--Your home State of New Hampshire continues to be a
    national leader in adopting Law-Related Education for use as both a
    prevention and intervention program. This year, a student team from
    Milford High School won the statewide ``We The People'' competition in
    March while the Manchester West High School team won the ``Mock Trial''
    competition. Each team will advance to the national competitions. In
    addition, the ``Lawyer in Every School'' program continues to be a key
    component of the New Hampshire program.
        Colorado.--In Colorado, at least 250 teachers have attended an
    annual public-private partnership conference for the past sixteen years
    as a means of updating their own knowledge. In May, hundreds of at-risk
    youth from Colorado schools will attend a Colorado Project Citizen
    Showcase where they will meet with federal, state, and local
    policymakers to present youth perspectives on policy issues that impact
    their lives. Federal support has been matched by private foundations
    and by local school districts through release time for teacher training
    and through individual volunteer efforts. As a result, teachers and
    school districts throughout the state receive a basic level of ongoing
    technical assistance.
        Hawaii.--This year's LRE support helped the Hawaii State Judiciary
    and non-profit Hawaii Friends of Civic and Law-Related Education to
    expand Parents and the Law (PAL), a project providing legal information
    to teen and at-risk parents. Assistance from LRE also benefited the
    state's efforts to curb youth violence in school settings. Technical
    and curriculum support provided through LRE enabled Hawaii State
    Judiciary staff to plan and conduct workshops for private and public
    schools devised to stem violence and hate speech.
        Wisconsin.--Recently, high school students argued before the
    Wisconsin Supreme Court as part of the statewide mock trial program.
    Over 170 schools participate in this annual event. In addition, the
    PEACE program (Peers in Education Addressing Conflict Effectively)
    helps train teachers to implement mediation programs in elementary
    schools so students can acquire the skills necessary to mediate and
    resolve their own disputes peacefully.
        Mr. Chairman, thanks to the continued commitment of this
    Subcommittee, Youth for Justice, the National, Coordinated Law-Related
    Education Program has built a vital, cost-effective program. This
    program:
      --Involves young people in identifying and implementing solutions to
            violence;
      --Promotes research-based educational programs that strive for safe,
            disciplined and drug-free schools and communities;
      --Teaches young people acceptable ways to resolve conflicts;
      --Fosters constructive attitudes towards authority figures;
      --Provides young people with meaningful opportunities to serve their
            communities;
      --Promotes understanding of and reasoned commitment to the rule of
            law along with tolerance for varied points of view in a free
            and diverse society; and
      --Helps young people understand the democratic process and develop
            the decision-making, and problem solving skills to enable their
            full participation in that process.
        LRE/Youth for Justice uses technology as a cost-effective way to
    expand its reach to the LRE field. For example, LRE has posted a
    planning guide for its Youth Summits on the Internet as well as free
    mock trial competition and descriptions of and contact information for
    state LRE programs. The National LRE Program also provides technical
    assistance to state LRE centers to demonstrate how they can use
    technology to link teachers and community volunteers.
        Youth for Justice is committed to providing leadership in the
    national effort to stop the outrage of violence committed by and
    perpetrated against this nation's youth. Each Spring, thousands of
    young people from both the school and juvenile justice settings gather
    with public officials to participate in Youth Summits designed to help
    develop public policy to help prevent violence by and against youth.
    Law-Related Education is an extraordinarily effective prevention
    program, but it is also an extraordinarily effective intervention
    program--Law-Related Education also reaches juvenile offenders in
    halfway houses, detention centers, and other non-school settings.
                   the national law-related education program
        The National, Coordinated Law-Related Education Program is
    comprised of five not-for-profit corporations, each of which is
    recognized nationally and internationally as a leader in the field of
    law and civic education: The American Bar Association's Division for
    Public Education; the Center for Civic Education; the Constitutional
    Rights Foundation; Street Law, Inc.; and the Phi Alpha Delta Public
    Service Center. By combining their expertise and experience as
    teachers, school administrators, juvenile justice professionals,
    attorneys and professors, these five organizations have successfully
    administered a nationwide program in which they have:
      --Established and maintained an effective network of delinquency
            prevention law and citizenship projects in all fifty states,
            the District of Columbia and Puerto Rico;
      --Provided training and technical assistance to the state projects in
            this network so that federal funding effectively leverages
            public and private funding appropriate to each state;
      --Established innovative law and citizenship programs for at-risk
            youth;
      --Developed and field-tested quality, research-based curricular
            materials for children--kindergarten through grade twelve--in
            public and private schools, juvenile detention centers, after-
            school programs and court-related diversion programs;
      --Organized special initiatives on violence prevention, drug
            prevention, juvenile justice and urban education, publishing
            materials and sponsoring training events nationwide; and
      --Mobilized thousands of volunteers with expertise in law, public
            policy, drug and alcohol abuse prevention, juvenile justice and
            other areas.
                evaluations and studies of law-related education
        For the past two decades, researchers have consistently reported
    that law-related curricula and instruction make a positive impact on
    youth, when compared with traditional approaches to teaching and
    learning law, civics and government.
        The Office of Juvenile Justice and Delinquency Prevention has noted
    that evaluations of Law-Related Education Program have been
    ``encouraging . . . confirming the previous findings that such
    education serves as a significant deterrent to delinquent behavior''.
    Eighth Analysis and Evaluation of Federal Juvenile Delinquency
    Programs, U.S. Department of Justice, OJJDP, p. 60 (1985). The Twelfth
    Analysis and Evaluation of Federal Juvenile Delinquency Programs
    published in 1988 similarly states, ``[A] national study suggests that
    Law-Related Education, when properly implemented, can reduce the
    tendency to engage in delinquent behavior.''
        A review of the research in Law-Related Education and related
    fields conducted by Dr. Jeffery W. Cornett (April 1997) concludes that
    LRE programs have a positive effect on student knowledge about law and
    legal processes, and about individual rights and responsibilities.
    Research studies indicate that effective LRE programs have improved
    juveniles' attitudes toward the justice system and toward authorities.
        In 1998, the National, Coordinated Law-Related Education Program
    released impact data from demonstration programs in Los Angeles,
    Chicago and Washington, D.C. showing the positive effect that Law-
    Related Education can have on the highest at-risk youth.
        In January 2001, Caliber Associates, the Office of Juvenile Justice
    and Delinquency Prevention's evaluation contractor, analyzed Law-
    Related Education in terms of programs proven to be effective in
    delinquency prevention and intervention. The results of this study
    demonstrate the promise of Law-Related Education with respect to
    delinquency prevention and intervention.
        The National, Coordinated Law-Related Education Program has a
    unique and remarkable record of achievement and continued support is
    crucial for the following reasons:
      --First, congressional support for Law-Related Education is vital to
            its survival.
      --Second, the Federal Government and, in particular, the Congress,
            has made a substantial investment over more than a decade in
            the creation of a National, Coordinated Law-Related Education
            network and infrastructure including state coordinating
            organizations.
      --Third, only a national program will undertake national initiatives
            that benefit the entire country, such as national training;
            national technical assistance; state financial assistance; new
            program and curriculum development such as Law-Related
            Education's highly successful and acclaimed Youth Summits; and
            the replication of successful state programs and the avoidance
            of unsuccessful pilot programs.
      --Fourth, federal money is seed money used to sustain a national
            program which raises approximately seven times the federal
            support through state legislative support, private donations
            and in-kind support.
        For all of these reasons, the National, Coordinated Law-Related
    Education Program is seeking earmark support at the 2.4 million dollar
    level. We thank you, Mr. Chairman and the members of this Subcommittee,
    for your support over all these many years and we ask for your
    continued support.
                                     ______

     Prepared Statement of The National Consortium for Justice Information
                                 and Statistics

        The Membership Group of SEARCH submits this testimony seeking
    appropriation support for our National Technical Assistance and
    Training Program in the fiscal year 2002 Byrne discretionary program
    appropriation for the Bureau of Justice Assistance (BJA), U.S.
    Department of Justice (DOJ). The National Technical Assistance and
    Training Program received an appropriations earmark in fiscal year 2001
    in the amount of $1.6 million. We respectfully submit this testimony to
    request funding at the $2.0 million level for fiscal year 2002.
        SEARCH is a nonprofit criminal justice organization governed by a
    Membership Group comprised of one gubernatorial appointee from each of
    the 50 states, the District of Columbia, Puerto Rico and the U.S.
    Virgin Islands. For over 30 years, we have dedicated our efforts to
    assisting state and local justice agencies combat crime and administer
    justice through the effective and responsible use of information and
    identification technologies.
        SEARCH's National Technical Assistance and Training Program
    provides no-cost assistance to all components of the state and local
    criminal justice system with respect to the development, operation,
    improvement and/or integration of all types of justice information
    systems. This significant program not only helps state and local
    agencies work more efficiently and effectively through the use of
    advanced information technology, but it also creates the foundation for
    a national information infrastructure for justice systems.
        SEARCH continues to experience an explosive growth in demand for
    the program. In 2000, we provided a 30 percent increase in the number
    of technical assistance efforts as compared to 1999. We expect to
    experience at least an additional 25-35 percent increase in technical
    assistance provided in 2001. There are a number of reasons for this
    demand, including the success of grant programs such as the Edward
    Byrne Memorial State and Local Law Enforcement Assistance Program, the
    Local Law Enforcement Block Grants Program, the COPS Technology Grant
    Program, and the Crime Identification Technology Act, which have
    provided seed money for justice information systems automation and
    integration. Also impacting the demand for SEARCH technical assistance
    and training services is the critical need of the nation's criminal
    justice agencies to share complete and accurate information quickly,
    which is manifested in their efforts to integrate and connect justice
    information systems. The momentum is showing nationally and is being
    led by the Attorney General's Global Justice Information Network
    initiative. This initiative is advocating dramatic improvements in how
    justice agencies share information nationally.
        We want to commend BJA and its fine, professional staff. Working in
    partnership with SEARCH, BJA has provided strong, national leadership
    to create opportunities for information systems training and technical
    assistance for state and local criminal justice officials.
                technical assistance program benefits all states
        SEARCH provides technical assistance via written correspondence,
    telephone consultations, electronic mail, an Internet Website, and
    onsite visits to agencies nationwide (including assistance focusing on
    statewide or regional justice integration efforts), as well as
    assistance provided at our National Criminal Justice Computer
    Laboratory and Training Center in Sacramento, California. SEARCH is
    responsive to Technical Assistance requests from every state, assisting
    agencies from all branches of government (state, county, city,
    regional), and providing guidance to every discipline in the justice
    system, including law enforcement, courts, prosecutor, probation,
    parole, corrections, and other case management agencies.
        Integrated systems assistance typically involves being onsite to
    help a state or region establish an automated justice information
    system, or evaluate and plan for multiagency integration of existing
    systems. These efforts are typically significant and complex, can
    involve multiple agencies and site visits, and deal with issues with
    far-reaching impact on state and local governments. SEARCH is currently
    providing such long-term technical assistance to agencies in Alabama,
    Arizona, California, Georgia, Hawaii, Kentucky, Missouri, Montana,
    Texas, Washington and Wisconsin.
        In the past year, SEARCH has provided hundreds of technical
    assistances via telephone, letter and email; thousands of Internet-
    based assistances; and dozens of technical assistances provided onsite
    at justice agencies or our Sacramento facility. In fiscal year 2002, as
    mentioned earlier, we expect these numbers to increase dramatically as
    demand for our technical assistance services rises. Not only do we
    expect demand on our in-house assistance to grow, we anticipate
    providing 50 separate onsite assistance efforts, which will serve
    scores of agencies and often involve multiple site visits for each
    effort.
           national training program responsive to cybercrime threat
        SEARCH helps the nation's law enforcement agencies to combat the
    escalating problem of computer crime by training and equipping them
    with the skills needed to investigate cybercrime, make arrests, and
    prosecute offenders. Since its inception, SEARCH's National Technical
    Assistance and Training Program has trained more than 26,500 criminal
    justice officials from every state in the use of computers and other
    information technologies. In fiscal year 2001, SEARCH will train more
    than 1,000 state and local criminal justice officials across the
    nation, both onsite at agencies and at our National Criminal Justice
    Computer Laboratory and Training Center in Sacramento. In order to
    provide training at more sites nationally, SEARCH recently implemented
    a Mobile Training Center that uses laptops and other mobile equipment.
        Training courses focus on providing investigators with critical
    operational skills, knowledge and techniques that will have a real-
    world impact, enabling them to gain a technological edge over the new
    breed of criminals who use computer technology to commit crimes such as
    fraud, theft and the online sexual exploitation of children. SEARCH's
    training courses, which range from one day to two weeks in length,
    include: The Investigation of Computer Crime; The Seizure and
    Examination of Microcomputers; Basic Local Area Network Investigations;
    Introduction to Internet Crime Investigations; Advanced Internet
    Investigations; and The Investigation of On-line Child Exploitation.
        To help our trainees keep pace with the ever-changing environment
    of cybercrime, SEARCH has developed two new courses, which will debut
    in 2001: Digital Media Analysis, and Computer Forensics. In the past
    year, staff from justice agencies in Colorado, Kentucky, Maryland,
    Texas and Vermont were among those who attended SEARCH training. ``The
    Investigation of Computer Crime,'' a weeklong course, was conducted
    onsite in a number of states, including Colorado, Texas and Vermont,
    and is next scheduled to be presented April 30-May 4, 2001, in Concord,
    New Hampshire.
                        selected examples of assistance
        The following illustrates just a few examples of SEARCH technical
    assistance and training efforts in the past year and the broad range of
    agencies receiving assistance.
        New Hampshire.--Recently, SEARCH assisted the New Hampshire Supreme
    Court with federally mandated reporting requirements for trial courts.
    As mentioned, next week, representatives of law enforcement agencies
    from throughout the state will attend SEARCH's ``The Investigation of
    Computer Crime'' training course in Concord. This weeklong course
    provides participants with an understanding of computer technology, its
    application to criminal endeavors, and the issues associated with
    investigating these types of cases.
        Colorado.--SEARCH provided onsite assistance to officials of the
    Colorado Integrated Criminal Justice Information System (CICJIS) with
    developing and implementing a short-term plan to accomplish system
    implementation goals. CICJIS is a significant, multiyear effort to
    integrate justice information systems on a statewide basis. Also, at
    the local level, SEARCH provided onsite assistance to the Westminster
    Municipal Court to help define its information requirements and
    evaluate continued use of its case management system. In shorter-term
    efforts in Colorado, SEARCH provided assistance associated with
    computer crime investigation issues to various state and local justice
    agencies, including the Colorado Bureau of Investigation, the Denver
    District Attorney's Office, the Boulder County Sheriff's Department,
    and the Police Departments of Colorado Springs and Longmont. In
    addition, 47 law enforcement investigators attended a weeklong SEARCH
    training course, ``The Investigation of Computer Crime,'' held at the
    U.S. Air Force Academy in Colorado Springs.
        Hawaii.--Nearly 30 officials, including the Hawaii Attorney
    General, attended a SEARCH-led meeting in Hawaii to oversee strategic
    planning for the statewide integration of multiple justice information
    systems, an effort being overseen by the state Attorney General's
    Office. In other assistance, SEARCH provided information on two
    occasions to the Hawaii Criminal Justice Data Center regarding security
    system audits.
        Vermont.--Of statewide significance is the onsite assistance that
    SEARCH is providing jointly to the Vermont Department of Public Safety,
    the Burlington Police Department and the Vermont Association of Chiefs
    of Police. SEARCH is assisting these agencies with the development of a
    strategic plan for information systems automation, especially with a
    view toward ensuring that the state system meets the needs of local
    users, and that Burlington's plans for new Computer-aided Dispatch,
    Records Management and Mobile Data Systems are responsive to statewide
    needs and requirements. In shorter-term assistance, the Essex Police
    Department received information on Internet Service Provider issues. In
    addition, law enforcement officers from throughout the state learned
    valuable new skills at a one-week SEARCH training course, ``The
    Investigation of Computer Crime,'' which was held in Pittsford and
    cohosted by the Vermont Criminal Justice Training Council.
              technical assistance and training program materials
        SEARCH's National Technical Assistance and Training Program also
    includes the preparation, publication, and national dissemination of
    materials and reports that assist criminal justice agencies in
    acquiring and using computers and other information technology. For
    example, SEARCH publishes quarterly Technical Bulletins that identify
    and evaluate information systems and technologies that have existing or
    potential application in criminal justice management. SEARCH also
    offers an online resource, the Integrated Justice Information Systems
    Website, which features state and local profiles of justice integration
    efforts, including links to information on governance structures,
    funding, technical overviews, project documents and more, as well as
    links to useful integration publications, articles and other resources.
    The Website can be reached at www.search.org/integration.
                                   conclusion
        Without question, federal support for the National Technical
    Assistance and Training Program makes a vital contribution to the war
    on crime. For a modest federal investment, leveraged many times over by
    state and local funds, a critical contribution is made to the ability
    of state and local criminal justice agencies to provide--and to share--
    timely, accurate and compatible information for use in apprehending,
    prosecuting and sentencing offenders.
        Accordingly, we respectfully request that the Subcommittee act to
    ensure fiscal year 2002 funding of SEARCH's National Technical
    Assistance and Training Program. We thank you, Mr. Chairman, the
    members of your Subcommittee and the Subcommittee staff for your
    continued support.
                                     ______

                              DEPARTMENT OF STATE

                   Prepared Statement of The Asia Foundation

        Mr. Chairman: Thank you for the opportunity to submit testimony
    supporting The Asia Foundation's fiscal year 2002 budget request. The
    Foundation is grateful for the support that the Congress and this
    Committee have provided over the years.
        Mr. Chairman, I would like to present The Asia Foundation's
    programs and our future plans to address the challenges and
    opportunities facing Asia. We believe that our programs demonstrate how
    a small, independent organization can advance American interests in the
    Asia-Pacific region.
        The Administration has endorsed the work of The Asia Foundation by
    requesting an appropriation of $9.25 million for fiscal year 2002. This
    funding would enable the Foundation to pursue programs in governance
    and legal reform, human rights, economic reform and peaceful,
    cooperative regional international relations. Most importantly, it will
    enable the Foundation to support Asian organizations that are
    positioned to play key roles in democratic and economic reform efforts
    throughout the region.
                                    overview
        Let me put the work of the Foundation into context. U.S. economic,
    political and security interests in Asia have become broader and more
    complex in the post-Cold War decade. Regional security challenges
    remain among the most important in the world, including China-Taiwan
    cross-straits relations, the Korean peninsula and the India-Pakistan
    border disputes, as well as internal conflicts in Indonesia, the
    Philippines, and Sri Lanka. Political changes in Asia, welcome as they
    are, represent a challenge to stability, as in the case of Indonesia.
    Some countries in the region remain under authoritarian rule, while a
    number of countries have embraced democracy, although their new systems
    are fragile. Human rights abuses and questions of impunity continue.
    Even though women in Asia have made gains, in many places they are
    still subject to economic and political inequities and, in the worst
    cases, they are victims of abuse and trafficking. Economically the
    region has not fully recovered from the crisis of 1997, and Japan's
    economy, so important to the region's economic growth, continues to
    sputter. One consequence of the transitions underway in countries is
    the increased demand by Asians for a range of reforms: the rule of law,
    government transparency and accountability, anti-corruption measures,
    the end of ``crony capitalism'', and improved corporate governance. At
    the same time, public policymaking, once considered the exclusive
    purview of the state, is expanding to include a role for citizens and
    business organizations in fields such as legal reform, human rights,
    the environment and health.
        We believe that The Asia Foundation, building on its continuing
    presence in Asia for nearly 50 years, is helping significantly to
    advance U.S. interests in this complex and dynamically evolving region.
    We are pleased that so many in Congress support our work. In the most
    recently enacted State Department authorization, The Asia Foundation
    was authorized at an annual level of $15 million. And we were
    especially gratified by the support received from the House. Last
    spring, the full House voted overwhelmingly to sustain Asia Foundation
    funding.
        In the past, this Committee has encouraged the Foundation's grant
    making role, and we remain faithful to that mission. The Foundation's
    hallmark is to make sequential grants to steadily build and strengthen
    institutions, develop leadership and advance policy reforms in
    countries in the region. Foundation assistance supports training,
    technical assistance, and seed funding for new, local organizations--
    all aimed at promoting reform, building Asian capacity, and
    strengthening relations with U.S. institutions.
        The democratic and economic transitions underway in Asia represent,
    in part, the return on investment the Foundation has made, over time,
    in support of individuals and institutions committed to reform. The
    Asia Foundation is a model of public-private partnership, with a long
    history of support from Asian and American policymakers and a respected
    track record in Asia.
                         the asia foundation's mission
        The Foundation's core objectives are central to U.S. interests in
    the Asia-Pacific region.
      --Democracy, Human Rights and Rule of Law.--Developing and
            strengthening democratic institutions and encouraging an
            active, informed and responsible non-governmental sector;
            advancing the rule of law; and building institutions to uphold
            and protect human rights.
      --Open Trade and Investment.--Supporting open trade, investment and
            economic policy reform at the regional and national levels.
      --Peaceful and Stable Regional Relations.--Promoting regional
            discussions on security cooperation, regional economic policy,
            and law and human rights.
        The region's future progress is in large part tied to governance
    and legal reforms that must be undertaken, but require political
    solutions. The increased complexity of problems in Asia requires
    flexible and creative solutions, based on knowledge, expertise and
    relationships in the region. The following examples illustrate the ways
    in which Foundation programs in key areas contribute to the advancement
    of U.S. interests in the region.
                                    programs
    Democracy and Human Rights
        Strengthening formal governmental institutions--including the
    constitutional framework, the legislative branch, and the judiciary--
    and encouraging the development of civil society and the protection of
    human rights, have been the hallmarks of The Asia Foundation's programs
    in Asia.
      --The Foundation has contributed to the development of parliaments in
            16 countries in Asia through technical assistance, training
            members and staff, facilitating interaction with the non-
            governmental sector, and developing parliamentary capacity to
            review budgets and other executive functions in Thailand,
            Taiwan, South Korea, Mongolia, the Philippines and Indonesia.
      --The Foundation is probably the single largest supporter of the non-
            governmental sector in the Asian countries in which we operate.
            The Foundation builds the capacity of organizations, encourages
            public participation, and works to improve the regulatory
            environment for NGOs. Foundation support has contributed to the
            establishment of new NGOs that have quickly made their mark,
            such as the Indonesian Institute for Independent Judiciary
            (LeIP), which played an important role in the recent, first
            time ever ``fit and proper'' test for new candidates for the
            Indonesian Supreme Court. LeIP conducted investigations of the
            capacity and integrity of candidates for the court at the
            request of the Indonesian Parliament, adding hope for more
            transparent procedures, better qualified justices and increased
            judicial accountability in future.
      --With the trend toward devolution of political and administrative
            authority to the sub-national level, local governance and
            decentralization programs are a priority for the Foundation.
            The Foundation has taken a lead role in supporting milestone
            efforts in China, the Philippines and Indonesia: for example,
            developing capacity for village level elections and supporting
            reforms of urban neighborhood committees in China.
      --The Foundation's human rights programs are premised on the
            expectation that the rights and obligations of all citizens
            will be better respected and observed when public institutions
            function in an open, transparent, and predictable manner, and
            when effective mechanisms are available for citizens to enforce
            their rights when they are threatened or violated. Responsible
            government, social stability, and the benefit of broad-based
            economic development are all predicated upon recognition and
            respect for human rights. Meaningful state and societal
            commitment to human rights is especially important for the
            poor, women, and other marginalized groups whose rights are
            vulnerable to abuse.
        With this in mind, the Foundation promotes the protection and
    advancement of human rights as an important priority of its work.
    Through its support of nongovernmental and governmental human rights
    efforts at the regional, national, and local levels, the Foundation's
    programs focus on forensic training for NGOs to investigate past human
    rights abuses; promotion of religious tolerance in Indonesia, including
    the use of Islamic scriptures to support messages of peace and non-
    violence; establishment of alternative dispute resolution programs;
    media training and guides on international human rights standards and
    conflict reporting for journalists; and programs to reduce trafficking
    and violence against women.
        In Indonesia, Cambodia, Thailand, the Philippines and Sri Lanka the
    Foundation is supporting comprehensive human rights programs that
    combine public awareness, training and monitoring efforts. The
    Foundation is giving special attention to the troubled region of
    Indonesia through support for local human rights organizations in Aceh,
    West Papua, and most recently, the Maluku Islands. In Maluku, an NGO
    coalition, Tapek Ambon, is working with Asia Foundation support, to
    reduce Muslim-Christian violence and to report human rights abuses to
    the Indonesian government and to national and international human
    rights organizations.
        With a $9.25 million appropriation, the Foundation will be able to
    maintain its programs in these current areas.
    Rule of Law
        The Asia Foundation is committed to the development of law and
    effective legal systems. Foundation grants and technical assistance
    support improved judicial administration, legal education, community
    legal assistance programs, and alternative dispute resolution. The
    following examples illustrate the scope of Foundation legal
    programming:
      --In China, where there are increased domestic and international
            pressures to reform the legal system and adopt international
            standards, the Foundation was one of the earliest supporters of
            legal reform efforts. Since 1998, the Foundation has supported
            efforts in China to limit the arbitrary power of officials, and
            create greater scope for citizen participation and redress
            through a series of administrative law reforms. With China's
            impending entry into the WTO, the Foundation's administrative
            law efforts in the future will also focus on China's compliance
            with WTO requirements related to legal transparency and
            consistency. Other programs support the provision of legal aid
            services and popular legal education to bring the benefits of
            legal reform directly to China's citizens.
      --Building on more than a decade of work in East Timor, the
            Foundation is the only American organization supporting East
            Timorese efforts in the constitutional drafting process, as
            well as assisting human rights groups, the newly formed
            National Jurists Association, and local NGOs involved in voter
            education programs for the upcoming elections.
      --With Foundation support, Sri Lankan organizations have been
            instrumental in providing legal aid services and legal rights
            training for local government officials and community leaders
            as well as legal literacy services for the public. This
            includes Foundation assistance to the Legal Aid Commission of
            Sri Lanka for the provision of legal aid through five regional
            offices, and services for victims of unlawful arrest and
            torture.
      --In the Philippines, the Foundation has supported a number of legal
            and judicial reform efforts, including strengthening legal
            protection of women and children, improvements in evidentiary
            procedure and other criminal laws, support for alternative law
            groups to monitor and report on judicial performance, and the
            development of alternative dispute resolution mechanisms at the
            local level.
      --In Indonesia, the Foundation has supported the National Law
            Commission to develop an action plan for the reform of the
            Indonesian legal system, as well as the newly established
            National Ombudsman Commission, and a number of ``watchdog
            NGOs'' to review and monitor the development and application of
            law, and the conduct of the judiciary and the police.
        Legal reform programs throughout the region, with particular
    emphasis on Indonesia, China, the Philippines and Nepal, will be a
    significant focus for the Foundation in fiscal year 2002. For example,
    in Indonesia, the Foundation will re-invigorate its programs with law
    schools and will consider initiating programs with the Ministry of
    Justice and the Supreme Court. In Nepal, the Foundation has begun a
    planning exercise for legal and judicial reform with Nepali legal
    institutions, including the courts, and a program to integrate
    alternative dispute resolution in to local government functions.
    Open Trade and Investment
        The Asia Foundation supports programs that lead to open trade and
    investment, and related economic policy reform. In particular, these
    programs help address the political and governance factors that
    contributed to the regional economic crisis, and support transparency,
    accountability and the rule of law.
      --In Indonesia, the Foundation supports policy and regulatory reforms
            that are making it easier for small and medium enterprises
            (SMEs) to get started and function, an area critical to growth
            and employment.
      --In collaboration with business, government and nongovernmental
            organizations, the Foundation works to improve the policy
            environment for information and communication technology (ICT)
            in Asia. Some examples include: support for the implementation
            of the APEC e-commerce readiness program, including identifying
            policy reforms needed for ICT in Thailand; policy research on
            ICT and competitiveness that led to improved legislation for e-
            commerce and intellectual property protection in the
            Philippines, as well as telecommunications law reform.
      --In Vietnam, in an effort to increase awareness and understanding of
            the U.S.-Vietnam bilateral trade agreement, the Foundation
            supported a series of workshops with the Vietnam Chamber of
            Commerce and Industry (VCCI) covering technical issues in
            customs and trade. The workshops also led to the production of
            handbooks produced by VCCI and the Foundation for domestic
            entrepreneurs. These handbooks lay out the schedule of
            commitments under various trade regimes and offers practical
            information for firms.
      --The Foundation supported regional organizations such as the Asia-
            Pacific Economic Cooperation (APEC) forum and the Pacific
            Economic Cooperation Council (PECC), which are committed to
            open trade and investment in the Pacific region. The Foundation
            supported the APEC working group on technology which set the
            agenda for the ASEAN ministerial meeting on SME and information
            technology issues. The Foundation also supported the formation
            of the Mongolian National Committee for Pacific Economic
            Cooperation (MONCPEC) and its engagement with PECC and APEC to
            enable Mongolia to analyze domestic economic reform efforts in
            the context of regional economic needs.
        In fiscal year 2002, the Foundation will increase its emphasis on
    the development of small and medium enterprise policy reform throughout
    the region, as well as focus on building constituencies for economic
    reform and open markets, particularly in the area of corporate
    governance to help reduce corrupt practices and restore investor
    confidence.
    Peaceful and Stable Regional Relations
        The Asia Foundation's programs in international relations reflect
    the unique capacity of the Foundation to promote increased
    understanding of different foreign policy perspectives through regional
    and international dialogue. Foundation programs advance and complement
    more formal diplomatic efforts to advance U.S. economic and security
    interests in the region, and help to strengthen Asian institutional and
    human resource capacity in the foreign policy field. For example:
      --The Foundation provides regular support for the Council for
            Security Cooperation in the Asia Pacific (CSCAP) process as a
            useful vehicle for Track Two dialogue on regional security and
            the evolving regional security structures.
      --In cooperation with the Asia Center at Harvard University, the
            Foundation supports a trilateral security conference series
            bringing together scholars and officials from China, Japan, and
            the United States for an on-going, high-level dialogue on
            security issues in the region.
      --The Foundation is supporting a number of programs focusing on U.S.-
            China relations, including a bi-lateral conference series on
            the Taiwan issue, meetings for Chinese foreign policy and
            defense officials with American counterparts, and Master's
            degree programs at U.S. universities for mid-career Chinese
            diplomats.
        In the coming year, the Foundation plan to re-initiate a series of
    bilateral dialogues between countries of key interest to the United
    States, including Thailand, Indonesia, and Vietnam. The Foundation will
    also support a new cross-straits security dialogue involving
    participants from the United States, China and Taiwan, and will
    facilitate additional cross-straits dialogue on such issues as local
    governance reform and the role and status of the non-profit sector.
                                   conclusion
        As the preceding examples of our work emphasize, the Foundation is
    a field-based organization that supports projects in Asia and builds
    the capacity of Asian institutions, while at the same time maintaining
    close links with the U.S. foreign policy community. Working through 14
    offices in the Asia-Pacific region, including China, Hong Kong and
    Taiwan, the Foundation provides vital support to local economic and
    political reform efforts. Through these offices and our resident
    representatives, we establish relationships with creative, reform-
    minded individuals and organizations who seek to advance the same goals
    and interests to which we are committed.
        The Asia Foundation is first and foremost a grant making
    organization. The Foundation has consistently received national
    recognition for its efficient grant-to-operating expense ratio,
    reflecting its commitment to maximizing the impact of its programs in
    Asia, while keeping operating expenses low. We are not a research
    organization or an academic institution, nor are we Washington based.
    We work on the ground in Asia as an accepted, trusted partner and
    supporter of Asian reform efforts that also support and reinforce
    American political, economic and security interests.
        Public funding is essential to our mission for many reasons. While
    the Foundation remains committed to expanding private funding, the
    flexibility and reliability that public funding lends to the
    Foundation's efforts is critical. As an organization committed to
    American interests in Asia, we can only be successful if potential
    private donors understand that the U.S. government continues to support
    our efforts in the region.
        Furthermore, private funding is almost always tied to specific
    projects (as are USAID funds for which the Foundation competes) and do
    not replace public funding, either in scale or in flexibility. The
    Foundation does not solicit or accept private funds that might
    compromise either our credibility or our fundamental commitment to
    support of U.S. interests in Asia. Moreover, the flexibility afforded
    by U.S. government appropriated funds enables the Foundation to respond
    quickly to fast-breaking developments and program opportunities, as
    demonstrated by our 2000 funding for human rights in East Timor and law
    reform programs in Indonesia. It also enables the Foundation to work in
    countries such as China, Vietnam, Korea, and Pakistan that are of
    priority to the United States, but where USAID and other official U.S.
    assistance is minimal or non-existent. The Asia Foundation continues to
    be a model of public-private partnership and a resource which
    complements official foreign policy efforts.
        It is important to note one important example of a new opportunity
    that has arisen in the Philippines where the new government of
    President Gloria Macapagal Arroyo has a daunting task of restoring
    confidence in the country's political institutions, curbing corruption,
    and revitalizing the Philippine economy. The Foundation is poised to
    support programs that build coalitions for reform within the
    nongovernmental, business, and governmental sectors, increase
    opportunities for public participation, and support local efforts to
    liberalize the economy. With additional funding, the Foundation would
    expand its legal and economic reform programs in the Philippines, and
    build on programs that reduce corruption, increase transparency and
    accountability in governance, and protect human rights, in line with
    American interests.
        In closing, Mr. Chairman, I have cited just a few examples of the
    many Asia Foundation programs that we consider central to U.S.
    political, economic, and security interests in an area of the world
    that is of vital importance, and that will continue to experience
    change in the years ahead.
        As you and your colleagues know, budget constraints have resulted
    in significant reductions in the Foundation's annual appropriation
    since fiscal year 1996 and even the requested $9.25 million is below
    the $15 million appropriation for the Foundation for a decade prior to
    1996. We have worked hard to manage our budget, reduce staff and
    expenditures, increase our efficiency, and diversify our funding
    sources. We have maintained our regional presence through our offices
    in Asia and ensured that the maximum possible amount of appropriated
    funds are dedicated to on-the-ground programs. Nevertheless, this
    constrained level of funding has limited the Foundation's ability to
    respond to the challenges and opportunities emerging in Asia. At a time
    of rapid change and uncertainty in the region, additional funding would
    enable the Foundation to expand directly its positive contributions to
    American interests.
                                     ______

     Prepared Statement of the Robert F. Wagner Graduate School of Public
                                    Service

      ``the challenge of democratic public service in the new millenium''
        The American experiment in democratic decision-making began long
    ago and in simpler times, but it has many lessons to offer nations and
    peoples around the world. After the Allies' victory in World War II,
    the United States faced an enormous challenge of rebuilding in Europe
    and Asia. Now, having defended its democratic system and won the Cold
    War, the United States faces a new challenge of encouraging the
    development of democratic political systems and market economies around
    the world. The struggle for democracy and economic freedom will require
    new weapons, but success in this battle may depend as much on American
    ingenuity and technological superiority as did our previous victories.
        Through its direct aid programs, its Fulbright and other scholar
    exchange programs, the Edmund Muskie and Ron Brown Fellows programs,
    and through various foreign visitor programs, our government is making
    a strategic investment in developing democratic, market-oriented
    leadership around the world. Indirectly, America's investment in higher
    education has also paid international dividends: American universities
    are the most popular destination of students who study abroad. (More
    international students enroll at NYU than any other American
    university.) During their stay and time of study in the United States,
    these international students are exposed to American institutions,
    American values, and American freedom.
    meeting the challenge: nyu and the robert f. wagner graduate school of
                                 public service
        I represent the Robert F. Wagner Graduate School of Public Service
    at New York University. The Wagner School--named after a great Senator
    from the State of New York, and his son, the three-term mayor of New
    York--is the largest school of public service in the United States,
    including students from more than 40 countries. In the past decade,
    Wagner faculty and programs have provided professional education to
    officials throughout the Newly Independent States, Africa, Latin
    America, and Asia. We have current partnerships with universities in
    France, England, Spain, Belgium, Ukraine, Mexico, Chile, Argentina,
    Mozambique and South Korea. We have welcomed their students into our
    classrooms, sent ours to theirs, and our faculty have taught courses on
    their campuses. The Wagner School has been a leading participant in the
    U.S. funded fellowships and educational exchange, hosted Fulbright
    scholars, and is now carrying out two Department of State funded
    programs in Ukraine and Mozambique. Wagner faculty are also providing
    technical assistance to the World Bank and other international
    organizations in Cambodia, Indonesia, Columbia, Uganda, South Africa
    and Mozambique.
        Wagner students receive very practical training. At the end of
    their master's degree program, they spend two semesters working in
    teams under faculty--supervision working for real world clients doing
    ``capstone'' projects in public policy, management, finance or urban
    planning. In the past three year more than 60 students have
    participated in international capstone projects for international
    organizations based in the United States such as Save the Children,
    UMCOR, Trickle Up, as well as a number of U.N. agencies. For example,
    this year five Wagner students are evaluating a humanitarian assistance
    project in Mozambique in cooperation with six students from our partner
    university in Mozambique. They coordinated their plans using email and
    interactive televideo conference meetings, and spent three weeks in
    January working in combined teams doing field work in Gaza, a province
    of Mozambique, which was an area most affected by last year's
    devastating floods.
        International NGOs, many based in the United States, have become
    major players in responding to humanitarian crises around the world and
    in civil society capacity building. The service delivery parts of the
    United Nations system, such as UNICEF and the Department of
    Peacekeeping Operations, have been given new and more complex
    assignments. At the same time, funders are demanding greater evidence
    of successful performance and imposing more rigorous standards of
    accountability. These developments have greatly increased the need for
    managerial competence in international public service organizations.
        In January 2000, The Wagner School inaugurated a new master's
    degree for managers of international public service organizations and
    is creating a new sub-field of public management education--
    international public service management. The first two classes of 36
    students represent 24 countries. Our partner program at Korea
    University, the Graduate School of International Studies, has admitted
    five students to a dual masters degree program: first an MA in
    international affairs, then our MS in management next year.
                            needs exceeding capacity
        Even as the largest school of public service, the Wagner School can
    enroll only a small fraction of the international students who want to
    pursue the fields of study offered. For many students from less
    economically developed parts of the world, the combined cost of tuition
    and books and travel to and residency in New York, constitute an
    impossibly high barrier to access. This barrier looms especially large
    for women from less developed regions of the world.
        Distance learning technologies have been used to expand the reach
    of our programs in our partnerships with universities around the world.
    Building on our experience using interactive televideo conferencing in
    courses with Europe, Latin America, and Asia, we are now introducing
    this technology in our work with Mozambique. By reducing the time and
    financial costs of faculty and student travel in educational
    partnerships, we believe modern technologies will enable the Wagner
    School to dramatically widen and deepen its reach to build capacity for
    democratic public service in the nations of the world. We are
    increasingly working with our university partners in other nations
    using distance learning technologies to provide a meeting place for
    technical assistance and exchange between officials in specialized
    fields. For example, two weeks ago the Wagner School hosted a two hour
    meeting between solid waste management officials in Rio De Janeiro and
    officials and experts in New York and Paris using an interactive
    televideo conference. We believe that if we were properly equipped the
    Wagner School could multiply many times over the reach and
    effectiveness of its public service policy and management education
    efforts around the world.
    The International Center for Democratic Public Service
        To bring together all of the outstanding programs and resources we
    have to offer, Wagner is seeking to develop an International Center for
    Democratic Public Service. This Center will focus the vast resources
    found in the Wagner School, NYU and New York City on developing and
    supporting policy leadership and management solutions worldwide. In
    addition to offering a range of courses and degree programs, the
    International Center for Democratic Public Service will serve as a
    forum for American and international leaders to discuss major policy
    objectives, and at which public service professionals can gather to
    share ideas and best practices before a global audience. It will create
    a global network of students, scholars, and practitioners who want to
    better understand how to improve public service delivery throughout the
    world in the 21st Century.
        As part of its strategic plan, the Robert F. Wagner Graduate School
    of Public Service intends to move its faculty and programs from their
    dispersed locations around Washington Square into one new integrated
    facility. A crucial component of this effort--and one needed to extend
    Wagner programs to a global economy--is the inclusion of the full range
    of distance learning technologies that would make the School's new home
    a state-of-the-art global professional education center. This is an
    area in which we will be seeking government support to help leverage
    funding from private foundations, corporations and individuals
    concerned with the delivery of public services worldwide.
        Properly equipped classrooms and computer laboratories can
    facilitate a wide range of projects involving faculty, students and
    practitioners located in multiple sites simultaneously, and
    technologically advanced lecture halls can accommodate unlimited
    attendance spanning great distances. These are all well-developed
    technologies, but their initial cost is expensive. However, the cost-
    effectiveness of these means of professional education make them the
    best hope for providing democratic public service capacity building on
    the scale necessary to transform the societies aspiring to join the
    United States in the great democratic experiment.
                                     ______

                                RELATED AGENCIES

    Prepared Statement of the National Association of Government Guaranteed
                                 Lenders, Inc.

        The National Association of Government Guaranteed Lenders, Inc.
    (``NAGGL'') is a trade association for lenders and other participants
    who make approximately 80 percent of the Small Business Administration
    (``SBA'') section 7(a) guaranteed loans. The SBA's 7(a) guaranteed loan
    program has proven to be an excellent public/private partnership. Since
    the program's inception, the SBA has made or guaranteed more than
    600,000 loans totaling approximately $80 billion. We thank the
    Committee for the opportunity to comment on appropriations for the SBA
    7(a) program for fiscal year 2002.
        NAGGL requests that an appropriation of $118 million be made for
    the SBA 7(a) program in fiscal year 2002. Although this represents a
    decrease in appropriations from the current year, it, nevertheless,
    would fund a growing program. The current year's appropriation would
    fund about $10.4 billion in 7(a) loans. Next year, we estimate demand
    of $11 billion. Yet, less appropriations would be needed in fiscal year
    2002 as a result of the OMB-determined SBA 7(a) subsidy rate declining
    from the fiscal year 2001 rate of 1.17 to 1.07 for fiscal year 2002.
        Since the beginning of ``Credit Reform'' in 1992, the SBA 7(a)
    subsidy rate has fallen from a high of 5.21 to the projected current
    services level for fiscal year 2002 of 1.07. This represents an 80
    percent reduction in the estimated cost of the program to the
    government. This reduction in subsidy costs has been achieved by
    improved underwriting guidelines, establishment of lender review
    procedures, and fee increases on both borrowers and lenders.
        There are many positive attributes of the SBA 7(a) loan program,
    including:
      --SBA loan programs provide as much as 40 percent of all long-term
            loans (loans with maturities of three years or longer) to small
            businesses.
      --SBA 7(a) loans have significantly longer maturities than
            conventional loans to small businesses. The average original
            maturity of SBA 7(a) loans, according to the Office of
            Management and Budget (``OMB''), is 14 years. By comparison,
            only 16 percent of conventional small business loans have
            maturities in excess of one year, and of those loans, the
            average maturity is less than four years
      --Longer maturities mean substantially lower monthly payments for
            borrowers. For example, the difference in monthly payments from
            a 10 year SBA 7(a) loan to a five year conventional loan (which
            would be above the average maturity for conventional loans),
            would be 35-40 percent. This is a significant increase for the
            average SBA borrower who tends to be a new business startup or
            an early stage company.
      --Small businesses do not have the same access to capital as do large
            businesses. The SBA programs bridge that capital gap. Banks can
            not be expected to make long-term loans, the kind most needed
            by small business, when banks are funded by a short-term
            deposit base.
      --The SBA 7(a) appropriations are leveraged almost 99 to 1 by the
            private sector, making this one of the governments' best
            economic development instruments. With a more accurate subsidy
            rate estimate (as discussed below), the leverage ratio would be
            even higher.
      --The SBA 7(a) loan program is just that--a loan program--which helps
            qualified small businesses obtain the long-term capital they
            need for growth and expansion. This means jobs, and a ``net
            return on investment'' for our local communities and the U.S.
            Treasury.
        Unfortunately, the Administration's budget request for fiscal year
    2002 for the SBA 7(a) loan program calls for further increases on both
    borrowers and lenders. The Administration proposes to reduce the
    subsidy rate from the fiscal year 2002 current services level of 1.07
    to zero. In reviewing the past performance of the SBA 7(a) loan
    program, fee increases simply are not justified. In addition, a recent
    NAGGL survey of SBA 7(a) lenders indicated that the use of the 7(a)
    program would be greatly diminished if fees were increased.
        For instance, for loans approved from fiscal year 1992-1998,
    Congress appropriated approximately $1.4 billion for subsidy budget
    authority. When looking at those loan cohorts, already approximately
    $1.25 billion has been returned to the Treasury through ``subsidy re-
    estimates.'' This means OMB has substantially over-estimated the cost
    of the 7(a) program. NAGGL believes that the SBA 7(a) program subsidy
    rate is far less than the subsidy rate currently estimated by OMB.
        In testimony before the House Small Business Committee just last
    year, an SBA official testified that the estimated default rate for the
    SBA 7(a) loan program was ``in the 8-10 percent range.'' Yet OMB
    requires the use of an approximate 14 percent default rate in the
    subsidy rate calculation. Each 1 percent reduction in the default
    estimate would reduce the subsidy rate by approximately 34 basis
    points, or .34. If the highest SBA default estimate of 10 percent (per
    the House testimony last year) were used, the current subsidy rate of
    1.17 percent would be reduced by over 120 basis points. This would mean
    that the subsidy rate today is already below zero.
        At the same House Small Business Committee hearing last year, the
    former SBA Administrator testified ``the program is already being run
    at a profit to the government.'' There is clearly no justification
    whatsoever to increase program costs on SBA 7(a) program participants.
        It is especially noteworthy that the leadership of both the Senate
    and House Small Business Committees have agreed with our assessments.
    In a letter to the Chairman and Ranking Member of the Senate Budget
    Committee dated March 16, 2001, Senate Small Business Committee
    Chairman Christopher Bond wrote:

        ``The small business community is dependent on the SBA 7(a) program
    to obtain long-term financing at a competitive interest rate. Each
    year, 40,000 or more small business concerns, who cannot obtain credit
    elsewhere, turn to the 7(a) program for critical financing. Currently,
    both the borrowers and lenders pay significant fees to the SBA to help
    offset the credit subsidy cost necessary to underwrite the program. The
    fiscal year 2002 budget request seeks to increase the fees paid by
    borrowers and lenders to offset the need for an annual appropriation.
    The net result of the Administration's budget would be to drive both
    the small business borrowers and the lenders from the program. I do not
    believe it is the intention of the Administration, nor is it the intent
    of Congress, to deny needed business loans to small business borrowers
    at the same time the economy is slowing and credit underwriting
    standards have tightened significantly. Therefore, I strongly recommend
    that $118 million be added to the Business Loan Account of the SBA
    fiscal year 2002 budget to support an $11 billion 7(a) loan program.''

        Likewise, the Ranking Democrat on the Senate Small Business
    Committee, Senator John Kerry introduced an amendment to the Senate
    budget resolution that would restore fiscal year 2002 funding for the
    SBA 7(a) program. Senator Bond and several other Senators, both
    Republican and Democrat, co-sponsored the legislation that passed the
    Senate under unanimous consent. A copy of the Senate Small Business
    Committee news release is attached.
        In a letter to the House Budget Committee dated March 14, 2001,
    House Small Business Committee Chairman Donald Manzullo writes:

        ``Previous reports from the General Accounting Office (GAO)
    indicate the subsidy costs have been inflated. OMB re-estimates of the
    subsidy cost of the 7(a) program consistently show execution rates are
    inflated. This has the potential to lead to the overcharging of small
    business borrowers. As the U.S. economy enters a period of zero growth
    and perhaps even a recession, the Committee is also concerned about the
    effect of these proposed heightened fees on the availability of capital
    to small businesses.
        The proposed increase in 7(a) fees, despite improvements in
    purchases and recoveries, continues to raise concerns in the Committee.
    Inaccurate subsidy costs will result in overpayment of fees and
    eliminate flexibility in program delivery. The Committee believes that
    the 7(a) program is already operating at or near a zero subsidy rate
    and the President's budget request should instead contain a one-time
    accurate accounting change to reflect that reality. Thus, there should
    not be a need to increase fees.''

        Importantly, the Administration's budget request recognizes that
    the proposed fee increase could have a detrimental impact on small
    businesses. Included in the budget narrative is the following:

        `` The Administration's fee proposal acknowledges that some small
    businesses may have trouble accessing capital--''

        Yet in the analytical perspectives section of the budget (page
    150), the Administration further states:

        ``Traditionally, small firms have faced difficulty obtaining long-
    term loans in the private market place because they tend to have
    limited credit history and cash flows. SBA's role as a `gap' lender is
    to correct these market imperfections and provide credit access during
    economic downturns.''

        NAGGL requests your support for $118 million in fiscal year 2002
    appropriations for the SBA 7(a) program. We urge you to make sure there
    remains a viable, usable SBA 7(a) loan program by rejecting any further
    fee increases, and supporting sufficient appropriations to support an
    $11 billion SBA 7(a) loan program for fiscal year 2002.
                                     ______

      Prepared Statement of the Upper Mississippi River Basin Association

        The Upper Mississippi River Basin Association (UMRBA) is the
    organization created 20 years ago by the Governors of Illinois, Iowa,
    Minnesota, Missouri, and Wisconsin to serve as a forum for coordinating
    the five states' river-related programs and policies and for
    collaborating with federal agencies on regional issues. As such, the
    UMRBA has an interest in the budget of the Maritime Administration
    (MARAD).
        Of particular concern to the UMRBA is funding for MARAD Operations.
    The President's fiscal year 2002 budget proposal includes $34 million
    for this account, an increase of 6 percent from fiscal year 2001. Among
    other things, the MARAD Operations budget supports research and
    development efforts, which help advance ship design, construction, and
    operations. For example, MARAD funding has been used to support the
    design of prototype mooring buoys used on the Upper Mississippi River.
    Such buoys allow tows to tie up safely while awaiting lockage, thus
    avoiding environmental damage that might be caused by mooring to the
    shoreline. Funding for research and development efforts such as these
    is critical to the safety and efficiency of commercial navigation on
    this nation's inland waterway system.
        In addition, the MARAD Operations account supports the Inland
    Waterways Intermodal Cooperative Program. This new program is designed
    to increase the efficiency and productivity of ports and freight
    transportation companies that use inland waterways. Shippers, terminal
    operators, barge lines, railroads, and fleeters will work together to
    identify and implement innovative cargo handling methods and
    technology.
        Finally, the MARAD Operations account supports MARAD's efforts to
    assist the maritime industry in complying with requirements to manage
    ballast water. Discharge of water from ships' ballast tanks can
    introduce non-indigenous aquatic species into U.S. waters. These
    species, such as zebra mussels and round gobies, can spread rapidly
    from the Great Lakes to inland waterways like the Mississippi River,
    threatening native species, the integrity of the ecosystem, and many
    water-dependent sectors of the economy. MARAD is working with other
    federal agencies and the maritime industry to develop a ballast water
    treatment technology test and demonstration program.
        The UMRBA supports adequate funding for the Maritime
    Administration's Operations account.

           LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS

                                  ----------
                                                                       Page
    Alachua County, Florida Board of County Commissioners, prepared
      statement......................................................   407
    Alaska Inter-Tribal Council, prepared statement..................   431
    American:
        Chemical Society, prepared statement.........................   419
        Indian Higher Education Consortium, prepared statement.......   387
        Museum of Natural History, prepared statement................   401
        Public Power Association, prepared statement.................   425
        Rivers, prepared statement...................................   380
    Ashcroft, Hon. John, Attorney General, Office of the Attorney
      General, Department of Justice.................................     1
        Opening remarks..............................................     1
        Prepared statement...........................................     3
    Association of America's Public Television Stations, prepared
      statement......................................................   381

    California:
        Indian Legal Services, prepared statement....................   438
        Industry and Government Central California Ozone Study
          Coalition, prepared statement..............................   379
    Campbell, Hon. Ben Nighthorse, U.S. Senator from Colorado,
      questions submitted by...................................52, 302, 311
    Carman, Gregory W., Chief Judge, United States Court of
      International Trade, the judiciary, prepared statement.........   376
    Center Directors' Association, prepared statement................   442
    Center for Marine Conservation, prepared statement...............   410
    Central Piedmont Community College, prepared statement...........   422
    City of:
        Fairfield, California, prepared statement....................   441
        Gainesville, Florida, prepared statement.....................   446
        Miami Beach, Florida, prepared statement.....................   413
    Clemson University, prepared statement...........................   439
    Columbia River Inter-Tribal Fish Commission, prepared statement..   384
    Columbia University, prepared statement..........................   390

    Domenici, Hon. Pete V., U.S. Senator from New Mexico, questions
      submitted by..............................27, 110, 146, 298, 307, 342

    Evans, Hon. Donald L., Secretary, Office of the Secretary,
      Department of Commerce.........................................    81
        Biographical sketch..........................................    84
        Prepared statement...........................................    81

    Florida State University, prepared statement.....................   415
    Freeh, Louis J., Director, Federal Bureau of Investigation,
      Department of Justice..........................................   241
        Opening statement............................................   242
        Prepared statement...........................................   247

    Gregg, Hon. Judd, U.S. Senator from New Hampshire:
        Opening remarks............................................241, 269
        Questions submitted by............................26, 104, 191, 237
    Gudes, Scott B., Acting Under Secretary and Administrator,
      National Oceanic and Atmospheric Administration, Department of
      Commerce......................................................81, 153
        Opening statement............................................   154
        Prepared statement...........................................   160

    Heyburn, Honorable John G., II, Chairman, Committee on the
      Budget, Judicial Conference of the United States, the
      judiciary, prepared statement..................................   353
    Hogarth, Bill, Assistant Administrator, National Marine Fisheries
      Service, National Oceanic and Atmospheric Administration,
      Department of Commerce.........................................   153
    Hollings, Hon. Ernest F., U.S. Senator from South Carolina,
      questions submitted by.........................................   147

    Inouye, Hon. Daniel K., U.S. Senator from Hawaii:
        Prepared statement...........................................   325
        Questions submitted by.....................................225, 336

    Kelly, Jack, Assistant Administrator, National Weather Service,
      National Oceanic and Atmospheric Administration, Department of
      Commerce.......................................................   153
    Kohl, Hon. Herb, U.S. Senator from Wisconsin, questions submitted
      by............................................................69, 341

    Leahy, Hon. Patrick J., U.S. Senator from Vermont:
        Prepared statement...........................................   116
        Questions submitted by.................................63, 150, 303

    Marine Fish Conservation Network, prepared statement.............   386
    Marshall, Donnie R., Administrator, Drug Enforcement
      Administration, Department of Justice..........................   277
        Prepared statement...........................................   279
    Mayer, Haldane Robert, Chief Judge, U.S. Court of Appeals for the
      Federal Circuit, the judiciary, prepared statement.............   377
    McConnell, Hon. Mitch, U.S. Senator from Kentucky, questions
      submitted by...................................................    50
    Mecham, Leonidas Ralph, Director, Administrative Office of the
      U.S. Courts, the judiciary, prepared statement.................   360
    Mikulski, Hon. Barbara A., U.S. Senator from Maryland:
        Prepared statement...........................................   116
        Questions submitted by.................................60, 111, 149
    Murphy, Diana E., Chair, United States Sentencing Commission, the
      judiciary, prepared statement..................................   369
    Murray, Hon. Patty, U.S. Senator from Washington:
        Prepared statement...........................................   293
        Questions submitted by......................................78, 227

    National:
        American Indian Court Judges Association, prepared statement.   429
        Association of Government Guaranteed Lenders, Inc., prepared
          statement..................................................   460
        Audubon Society, prepared statement..........................   415
        Center for Victims of Crime, prepared statement..............   436
        Federation of Community Broadcasters, prepared statement.....   392
        Public Radio, prepared statement.............................   393
    National, Coordinated Law-Related Education Program, prepared
      statement......................................................   449
    Northwest Tribal Court Judges Association, prepared statement....   426

    Pacific Marine Conservation Council, prepared statement..........   418
    People for the Ethical Treatment of Animals, prepared statement..   420
    Powell, Hon. Colin L., Secretary of State, Department of State...   115
        Biographical sketch..........................................   125
        Prepared statement...........................................   120
    Powell, Michael K., Chairman, Federal Communications Commission..   315
        Prepared statement...........................................   318

    Retzlaff, Barbara, Budget Officer, Office of the Secretary,
      Department of Commerce.........................................    81
    Robert F. Wagner Graduate School of Public Service, prepared
      statement......................................................   458
    Rooney, Kevin D., Acting Commissioner, Immigration and
      Naturalization Service, Department of Justice..................   269
        Biographical sketch..........................................   276
        Opening statement............................................   269
        Prepared statement...........................................   271

    Smith, Hon. Fern M., Director, Federal Judicial Center, the
      judiciary, prepared statement..................................   364
    Stevens, Hon. Ted, U.S. Senator from Alaska, questions submitted
      by.............................................................   224

    The Asia Foundation, prepared statement..........................   454
    The National Consortium for Justice Information and Statistics,
      prepared statement.............................................   451
    The Nature Conservancy, prepared statement.......................   395
    Tribal Law and Policy Institute, prepared statement..............   434

    Unger, Laura Simone, Acting Chairman, Securities and Exchange
      Commission.....................................................   345
        Prepared statement...........................................   347
        Summary statement............................................   345
    United States Section of the Pacific Salmon Commission, prepared
      state-
      ment...........................................................   421
    University Corporation for Atmospheric Research, prepared
      statement......................................................   397
    University of Miami, Coral Gables, Florida, prepared statement...   404
    Upper Mississippi River Basin Association, prepared statement....   462

    Walters, Greg, Deputy Chief Financial Officer, Small Business
      Administration.................................................   229
    Whitmore, John, Acting Administrator, Small Business
      Administration.................................................   229
        Prepared statement...........................................   231

                                 SUBJECT INDEX

                                  ----------

                             DEPARTMENT OF COMMERCE

                National Oceanic and Atmospheric Administration

                                                                       Page
    Additional committee questions...................................   190
    Budget development process.......................................   214
    Coastal storms initiative........................................   189
    Columbia River salmon, biological opinion for....................   227
    Cross-cutting issues.............................................   156
    Executive Order 13158, cost for..................................   225
    Fisheries:
        Lab construction.............................................   178
        Lawsuits.....................................................   191
        Vessels......................................................   224
    Headquarters office support......................................   192
    Highly migratory species.........................................   225
    Hollings Marine Laboratory.......................................   180
    Hurricane:
        Forecasting..................................................   157
        Tracking and forecasting.....................................   178
    Hydrographic surveys, critical backlog in........................   189
    Industry and Government buy-back programs........................   228
    Jurisdictional authority of interior.............................   177
    Marine:
        Authorizations for activities................................   225
        Commerce jurisdiction over resources.........................   226
        Protected areas..............................................   224
    Maritime transportation system...................................   157
    Nautical charts..................................................   217
    NMFS:
        Cooperative research.........................................   191
        Lawsuit backlog..............................................   186
    NOAA:
        And Port of Everett, agreement between.......................   227
        Budget priorities............................................   156
        Management improvements......................................   155
    Northwestern Hawaiian Islands sanctuary..........................   226
    NPOESS satellites................................................   158
    Ocean exploration................................................   159
        And education programs.......................................   212
    Pacific salmon recovery, funding for.............................   190
    Permit backlog problem...........................................   227
    Real facility and equipment needs................................   195
    Research vessel allocation.......................................   215
    Restoration programs.............................................   219
    Steller sea lion:
        EIS on.......................................................   183
        Factor's contributing to decline.............................   188
        Findings on..................................................   181
        Issues.......................................................   179
    Weather buoys in the Northeast...................................   191

                            Office of the Secretary

    Additional committee questions...................................   103
    Advanced technology program (ATP)...............................91, 106
    Boeing versus Airbus.............................................    98
    Commerce administrative management system (CAMS).................   104
    Commerce, promoting in Southwest region..........................   110
    Commerce-wide hiring freeze......................................    99
    Critical Infrastructure Assurance Office.......................102, 105
    Digital divide...................................................   111
    Export-Import Bank..............................................96, 100
        Funding in fiscal year 2002..................................    97
    International trade, level playing field for.....................    90
    Low-income communities, accessing EDA funds to...................   111
    NOAA:
        Discussion by Senator Hollings...............................    89
        Fisheries research vessels...................................   109
        NMFS:
            Cooperative research.....................................   108
            Lawsuits.................................................   109
        Research vessel, contract for................................    91
    Northeast dairy compact..........................................    95
        Administration policy on.....................................    95
    Northwest Straits Commission.....................................    98
    Overview of Secretary Evans' statement...........................    84
    Patent and Trademark Office (PTO)................................   106
    Reports and spending plan........................................   104
    Salmon, comparison of wild and farm-raised.......................    93
    Spectrum.........................................................   101
    Steller sea lions, research on...................................    92
    Suitland facilities..............................................   111
    Technology opportunities program.................................   100
    Technology program...............................................   108
    Textile research.................................................    91
    U.S. markets to ensure growth, stimulating.......................   110
    US&FCS staffing..................................................   107

                             DEPARTMENT OF JUSTICE

                        Drug Enforcement Administration

    Budget request:
        DEA..........................................................   278
        Firebird.....................................................   278
        Fiscal year 2002.............................................   280
        Laboratory operations initiative.............................   278
        Special Operations Division..................................   278
    DEA:
        Budget to GPRA indicators, linking...........................   309
        Budget to performance, linking...............................   307
        FBI cooperation..............................................   296
        Progress with Mexico.........................................   295
        Strategic plan...............................................   288
        Work with Amtrak in New Mexico...............................   310
    Demand reduction.................................................   287
    Drug:
        Diversion....................................................   287
        Trafficking threat to the United States, current.............   285
    Ecstasy..........................................................   311
    HIDTA............................................................   313
    Major investigations.............................................   283
    Methamphetamine resources........................................   296
    OMB budget request...............................................   296
    Quantico training facility.......................................   297
    Questions submitted to the.......................................   307
    The challenge: International drug trafficking organizations......   280
    The response: Today's DEA........................................   282
    United States, impact on the.....................................   287

                        Federal Bureau of Investigation

    Black tar heroin and methamphetamine trafficking.................   298
    Budget request, overview of fiscal year 2002.....................   251
    Communications assistance for law enforcement (CALEA)............   246
    Congressional automation funding and FBI culture.................   259
    Counterintelligence..............................................   252
    Counterterrorism.................................................   252
        Technology, and crimes against children......................   243
        Threefold increase in........................................   244
    Cybercrime.......................................................   253
    Data storage and retrieval.......................................   303
    Encryption issue.................................................   257
    FBI:
        Challenges facing the........................................   247
        Culture problem..............................................   262
        Development of Domestic Terrorism Division...................   300
        Discovery process errors.....................................   259
        Strategic plan update........................................   248
    ``Hanssen'' case.................................................   305
    Infrastructure...................................................   255
    International crime..............................................   302
    Lab and equipment situation......................................   265
    Lab improvement, role of Dr. Kerr in.............................   266
    Law enforcement school in Mexico.................................   267
    Legislative proposals............................................   256
    McVeigh matter:
        And records management.......................................   245
        Error........................................................   258
        Errors in matter.............................................   261
    National Infrastructure Protection Center........................   245
    Polygraphs and national security.................................   267
    Questions submitted to the.......................................   298
    Related departmental funding requests............................   256
    State forensic computer technology centers.......................   264
    Training:
        And automation needs, analyses of............................   264
        And experience...............................................   263
    2002 budget request..............................................   246

                     Immigration and Naturalization Service

    Border control strategy..........................................   269
    Border Patrol facilities.........................................   291
    Detention:
        And removal program, effective...............................   270
        Space........................................................   290
    Facilities construction funding requests.........................   291
    Guest worker proposals...........................................   290
    Immigrants, more entering the country............................   289
    Immigration benefits.............................................   270
    Long-range facilities plans......................................   291
    Northern border..................................................   291
        Meeting needs at the.........................................   294
    Workload models..................................................   295

                         Office of the Attorney General

    Additional committee questions...................................    26
    Antitrust enforcement............................................    77
    Attorney reassignments...........................................    14
    Ballistics funding...............................................    78
    Basic law enforcement--the core Federal mission..................     4
    Black tar heroin drug trafficking in northern New Mexico.........    46
    Border Patrol:
        Agents for the northern border...............................    78
        Facilities...................................................    11
    Boys and Girls Club..............................................    63
    Bulletproof Vest Partnership Grant Program.......................    63
    Bush administration priorities...................................     6
    Caseloads in Federal courts......................................    30
    Civil rights.....................................................     2
    Combating terrorism..............................................    48
    Community-Oriented Policing Service (COPS).......................    61
        Funding......................................................    74
    Computer Crime Enforcement Act...................................    64
    Data collection practices........................................    66
    DEA, reorganization of...........................................    24
    Debt Management Center and Law Enforcement Support Center,
      resources for the..............................................    69
    Department of Justice:
        Internet sites, review of....................................    67
        International crime response to..............................    52
    Detention trustee................................................    24
    DNA Analysis Backlog Elimination Act.............................    65
    Drug enforcement.................................................     2
    Economic espionage...............................................    72
    Enforcing Underage Drinking Laws Program.........................    65
    Faith-based:
        Initiative...................................................    18
        Program......................................................    16
            Safeguards with..........................................    17
    Federal Law Enforcement Training Center in Artesia, New Mexico,
      underutilization of the........................................    30
    First responder training.........................................    41
    Gun crime........................................................     2
    Gun prosecutor program...........................................15, 16
    Immigration......................................................     3
    Immigration and Naturalization Service:
        Continued operating and management problems for..............    49
        Personnel at Santa Teresa, New Mexico Port-of-Entry, staffing
          by.........................................................    29
        Reorganization...............................................    12
        Restructuring................................................10, 47
    Indian country, law enforcement in...............................    34
    Interagency crime and drug enforcement (ICDE) account............    26
    Judicial:
        Appointments, consultation on................................    26
        Nominees.....................................................    60
    Law enforcement:
        In Mexico....................................................    19
        Resources....................................................    75
    Mental health courts.............................................    32
    Office of Justice Programs, reorganization of the................    23
    OxyContin........................................................    50
    Paul Coverdell National Forensic Science Improvement Act of 2000.    66
    Performance, linking DOJ's budget to.............................    48
    Ports of entry...................................................    21
        Santa Teresa.................................................    22
    Prevention programs..............................................    70
    Project ChildSafe................................................    69
    Radiation compensation transfer to Energy Department.............    22
    Radiation exposure compensation program..........................21, 27
    State and local law enforcement..................................     3
    Technology and critical infrastructure needs.....................     5
    Tobacco litigation...............................................12, 26
        Funding......................................................    13
    Video games......................................................    71
    Violent Offender Incarceration Prison Grant Program..............    65

                              DEPARTMENT OF STATE

                               Secretary of State

    Additional committee questions...................................   146
    Administration of foreign affairs................................   121
    Asian-United States relations....................................   138
    China:
        Trade with...................................................   144
        United States relations, Secretary's comments on.............   141
    Embassy construction:
        Cost of......................................................   128
        Requirements.................................................   140
    Foreign service officers, adequate support for...................   132
    Global public health.............................................   144
    International organizations......................................   123
    Iran and Iraq, situation in......................................   137
    Iraq sanctions...................................................   143
    Middle East:
        Affairs......................................................   133
        Visit, Secretary's comments on...............................   135
    Office of War Crimes issues......................................   150
    Peacekeeping missions, cost of...................................   126
    Related appropriations...........................................   124
    Special envoy to Cyprus..........................................   133
    Trafficking in humans............................................   134
    2008 Summer Olympics, China's bid for the......................130, 134

                       FEDERAL COMMUNICATIONS COMMISSION

    Additional committee questions...................................   336
    An investment in the future: The FCC's 2002 budget...............   320
    Cable television service costs...................................   329
    Caribbean phone scams............................................   341
    Department of Defense needs......................................   330
    Enforcement tools, better........................................   328
    FCC reform:
        And the ``Shot Clock'' bill..................................   341
        The new business plan........................................   321
    Hardware taxing..................................................   333
    Keeping our part of the bargain..................................   321
    New beginnings for an old Commission.............................   319
    Tauzin-Dingell.................................................325, 333
    Telecom Act......................................................   327
    Telephone bills confusion........................................   328
    Universal service:
        Fund.........................................................   331
        Reform.......................................................   342

                       SECURITIES AND EXCHANGE COMMISSION

    Fee reductions...................................................   349
    Pay parity.......................................................   350
    Penalty collections..............................................   350
    Positions, vacant................................................   351
    Staffing crisis..................................................   348
    Station Place lease procurement..................................   349

                         SMALL BUSINESS ADMINISTRATION

    Additional committee questions...................................   237
    Counseling and technical assistance programs.....................   232
    Disaster Assistance Loan Program...............................234, 238
    Financial assistance programs....................................   231
    Fiscal year 2002, programs that will not be funded in............   235
    Loan monitoring system...........................................   234
    Program for investment in microenterprises (PRIME)...............   239
    SBA operating costs..............................................   234
    7(a) program.....................................................   237
    Small business development centers...............................   238
    Systems modernization initiative.................................   239

                                 THE JUDICIARY

    Administrative Office of the U.S. Courts:
        Accomplishments and challenges for the future................   361
        Administrative Office:
            Budget request...........................................   361
            Role of the..............................................   360
        Model of efficiency..........................................   361
        Program assessments..........................................   360
    Federal Judicial Center:
        Center services and activities...............................   366
        2002 request.................................................   364
    Judicial Conference of the United States:
        Administrative Office, contributions of the..................   357
        Budget overview..............................................   353
        Cost containment.............................................   356
        Court:
            Security.................................................   355
            Support staff............................................   355
        Defender services............................................   354
        Federal Judicial Center, contributions of the................   358
        Judgeships, new..............................................   356
        Judicial compensation........................................   356
        Justice, ensuring the quality of.............................   354
    United States Sentencing Commission:
        Justification................................................   370
        Resources requested..........................................   370

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