[Senate Hearing 107-437]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 107-437
 
           NOMINATION HEARING FOR MARK REY AND HILDA GAY LEGG
=======================================================================


                                HEARING

                               before the

                       COMMITTEE ON AGRICULTURE,
                        NUTRITION, AND FORESTRY

                          UNITED STATES SENATE


                      ONE HUNDRED SEVENTH CONGRESS

                             FIRST SESSION

                               __________

                             JULY 26, 2001
                               __________

                       Printed for the use of the
           Committee on Agriculture, Nutrition, and Forestry







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           COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY



                       TOM HARKIN, Iowa, Chairman

PATRICK J. LEAHY, Vermont            RICHARD G. LUGAR, Indiana
KENT CONRAD, North Dakota            JESSE HELMS, North Carolina
THOMAS A. DASCHLE, South Dakota      THAD COCHRAN, Mississippi
MAX BAUCUS, Montana                  MITCH McCONNELL, Kentucky
BLANCHE L. LINCOLN, Arkansas         PAT ROBERTS, Kansas
ZELL MILLER, Georgia                 PETER G. FITZGERALD, Illinois
DEBBIE A. STABENOW, Michigan         CRAIG THOMAS, Wyoming
BEN NELSON, Nebraska                 WAYNE ALLARD, Colorado
MARK DAYTON, Minnesota               TIM HUTCHINSON, Arkansas
PAUL DAVID WELLSTONE, Minnesota      MICHEAL D. CRAPO, Idaho

                     Mark Halverson, Staff Director
                    David L. Johnson, Chief Counsel
                      Robert E. Sturm, Chief Clerk
              Keith Luse, Staff Director for the Minority

                                  (ii)

  







                            C O N T E N T S

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                                                                   Page

Hearing(s):

Nomination Hearing for Mark Rey and Hilda Gay Legg...............    01

                              ----------                              

                        Thursday, July 26, 2001
                    STATEMENTS PRESENTED BY SENATORS

Harkin, Hon. Tom, a U.S. Senator from Iowa, Chairman, Committee 
  on Agriculture, Nutrition, and Forestry........................    01
Craig, Hon. Larry, a U.S. Senator from Idaho.....................    05
McConnell, Hon. Mitch, a U.S. Senator from Kentucky..............    02
Murkowski, Hon. Frank H., a U.S. Senator from Alaska.............    03
Rogers, Hon. Harold, a U.S. Senator from Kentucky................    06
                              ----------                              

                               WITNESSES

Legg, Hilda Gay of Somerset, Kentucky, to be Administrator, Rural 
  Utilities Service, United States Department of Agriculture.....    10
Rey, Mark of Canton, Ohio, to be Under Secretary for Natural 
  Resources and the Environment, United States Department of 
  Agriculture....................................................    08
                              ----------                              

                                APPENDIX

Prepared Statements:
    Baucus, Hon. Max.............................................    42
    Bunning, Hon. Jim............................................    31
    Crapo, Hon. Mike.............................................    30
    McConnell, Hon. Mitch........................................    32
    Legg, Hilda Gay..............................................    37
    Rey, Mark....................................................    33
Document(s) Submitted for the Record:
    Legg, Hilda Gay, Biography...................................    60
    Rey, Mark, Biography.........................................    44
    Support Letters and Testimonies for the Nomination of Mark 
      Rey........................................................    81
    Opposition Letters and Testimonies for the Nomination of Mark 
      Rey........................................................    85
Questions and Answers
    Harkin, Hon. Tom.............................................   102
    Baucus, Hon. Max.............................................   145
    Daschle, Hon. Thomas.........................................   138
    Lugar, Hon. Richard G........................................   134

                              ----------                              




            NOMINATION HEARING: MARK REY AND HILDA GAY LEGG

                              ----------                              


                        THURSDAY, JULY 26, 2001

                                       U.S. Senate,
         Committee on Agriculture, Nutrition, and Forestry,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:41 a.m., in 
room SR-328A, Russell Senate Office Building, Hon. Tom Harkin, 
[Chairman of the Committee], presiding.
    Present or submitting a statement: Senators Harkin, Conrad, 
Lugar, McConnell, Thomas, Allard, and Crapo.

    STATEMENT OF HON. TOM HARKIN, A U.S. SENATOR FROM IOWA, 
              CHAIRMAN, COMMITTEE ON AGRICULTURE,
                    NUTRITION, AND FORESTRY

    The Chairman. The Senate Committee on Agriculture, 
Nutrition, and Forestry will come to order. I apologize to all 
for being late.
    This morning we are considering two nominations for 
important positions at the Department of Agriculture. Mr. Mark 
Rey is nominated to serve as Under Secretary for Natural 
Resources and the Environment, and Hilda Legg is nominated to 
serve as Administrator of the Rural Utilities Service.
    The committee welcomes you, Mr. Rey and Ms. Legg, and looks 
forward to your testimony.
    The Under Secretary for Natural Resources and Environment 
oversees both the Forest Service and the Natural Resources 
Conservation Service at USDA. This position is one of great 
responsibility involving both public and private lands. The 
health and conservation of forests and agricultural lands is 
critically important to all of us. If we do not respect and 
properly care for the land, we will impoverish ourselves and 
future generations, both materially and spiritually.
    The Under Secretary will have a crucial role in developing 
and carrying out our Nation's policies affecting farm and 
forest lands.
    The Administrator of the Rural Utilities Service also has a 
very important responsibility involving the quality of life and 
economic progress of rural communities.
    From its beginning, the Department of Agriculture has 
sought to help enhance the lives of Americans on farms and 
ranches and in small towns across our Nation. Since the 
formation of the Rural Electrification Administration under 
President Roosevelt, USDA has played a key role in helping 
rural America secure amenities that are taken for granted in 
urban areas. Yet even in times of national prosperity, rural 
communities still lag behind the rest of the country. Surely we 
can do more both in Congress and the Department to help close 
that gap.
    I am pleased to welcome our colleagues, Senator Murkowski, 
Senator Craig, and Congressman Rogers.
    I would also like to recognize and welcome several members 
of Mr. Rey's family who are here. I will permit him to 
introduce them when we call upon Mr. Rey. Again, we are pleased 
to have all of you here.
    I will turn to the distinguished ranking member, Senator 
Lugar, for any opening statement he may have.
    Senator Lugar. Thank you very much, Mr. Chairman. I will 
forego an opening statement. I am looking forward to the 
introductions by our colleagues of these distinguished 
nominees. I appreciate their willingness to serve. They are 
able people. For the record, as the Chairman knows, he and I 
are given the FBI file. I have examined those carefully in 
preparation for the hearing. We look forward to hearing the 
testimony.
    Senator McConnell. Mr. Chairman, if I may, I am also going 
to want to say a word about Hilda Legg, who is a friend and 
constituent of mine, whenever you think that is appropriate.
    The Chairman. Well, I think now would be the appropriate 
time, Senator.

STATEMENT OF HON. MITCH McCONNELL, A U.S. SENATOR FROM KENTUCKY

    Senator McConnell. Mr. Chairman, I am pleased to join my 
friend and colleague, Hal Rogers, in introducing our 
constituent, Hilda Legg, of Somerset, Kentucky. Hilda is an old 
friend and former staffer from years ago who has had a truly 
distinguished career and is an outstanding choice by the 
President for the Rural Utilities Service.
    Hilda is in Washington accompanied by her 16-month-old son, 
Dane, and we want to welcome you and him, wherever he may be.
    The Rural Utilities Service is an agency dedicated to 
helping rural America finance water, electricity, and 
telecommunications projects, as well as providing loans and 
grants for rural distance learning and telemedicine projects.
    The Administrator of RUS must be well versed in the needs 
of our rural communities and in the role that rural development 
projects play in the overall economy and the well-being of 
rural America.
    Nobody could be better qualified for this job than Hilda, 
who comes to us from the Center for Rural Development, which is 
really the brainchild of Congressman Rogers, where she is 
presently serving as executive director and CEO. She has also 
served as past Alternate Federal Co-Chair of the Appalachian 
Regional Commission.
    She has been responsible for the overall management of this 
center that I just referred to that has been a national model 
for economic development in rural areas. Her expertise includes 
agriculture, advanced technology, export assistance, and small 
business development.
    Hilda is no stranger to the Senate. As I mentioned earlier, 
she was confirmed by the Senate as Co-Chair of the Appalachian 
Regional Commission. As Co-Chair, she worked with the Governors 
of 13 States and with a budget of over $190 million in a 
position aimed at job creation, building infrastructure, 
education and work force training, and numerous research 
projects.
    She has a long resume, and in the interest of time, I am 
just going to hit on the highlights of her career, which, as I 
would suspect you expect me to say, the highlight of her career 
was when she worked for me.
    [Laughter.]
    The Chairman. Let's hear from her on that one.
    Senator McConnell. From 1985 to 1987. Obviously I am very 
proud and pleased to be here to introduce Hilda and to wish her 
well in this new position. I am sure she will bring great 
distinction to the job and to our State and to the United 
States.
    Thank you very much, Mr. Chairman.
    The Chairman. Thank you very much, Senator McConnell.
     The prepared statement of Senator McConnell can be found 
in the appendix on page 32.]
    Senator Thomas, did you have any statement?
    Senator Thomas. No, sir. I just welcome Mark. I worked with 
him, of course, on the committee, and I am very interested in 
what Ms. Legg will be doing, as I was manager of the Rural 
Electric Association. So I welcome our folks and am very proud 
to support them.
    The Chairman. Very good.
    Senator Crapo.
    Senator Crapo. I, too, simply welcome both Ms. Legg and Mr. 
Rey to the committee today, and I look forward to a prompt and 
expeditious treatment of their nominations.
    The Chairman. Very good. Also, for the record, both Senator 
Lugar and I have a letter from Senator Bunning that I will make 
part of the record. He says, ``I support your committee in 
taking up the nomination of Hilda Legg to be the next 
Administrator of the Rural Utilities Service at USDA. The 
President has made an excellent choice by selecting Hilda, and 
I hope that you are able to vote her out of committee soon.''
    ``Again, the President has made a fine choice. I 
wholeheartedly endorse her nomination, and I look forward to 
her confirmation by your committee in the full Senate.'' Signed 
by Senator Jim Bunning.
    [The prepared statement of Senator Bunning can be found in 
the appendix on page 31.]
    The Chairman. Now I will turn to our distinguished Senators 
who are here for the purpose of introduction and support and 
whatever they want to add to these proceedings. I will first 
recognize the Senator from Alaska, Senator Murkowski.

   STATEMENT OF HON. FRANK H. MURKOWSKI, A U.S. SENATOR FROM 
                             ALASKA

    Senator Murkowski. Thank you very much, Senator Harkin, and 
let me thank you, Senator Lugar, and the other members for 
scheduling this hearing today. I am going to speak on behalf of 
the nominee, Mark Rey, for Under Secretary for Natural 
Resources and Environment, and I think it is very appropriate 
that you are able to expedite this nominee by holding this 
hearing.
    I have had the pleasure of working with Mark for a number 
of years. He has served the Senate Energy and Natural Resources 
Committee as a professional staff member since the 104th 
Congress, so we have had an opportunity to work together for 
some time. He has an extraordinary knowledge of issues, 
individuals, organizations involved in the Department of 
Agriculture Natural Resources and Environment portfolio, which 
is certainly a significant responsibility of this committee.
    He has handled some of the tough issues, particularly in 
the Pacific Northwest relative to resource development. He has 
worked closely with Senator Craig, who was the subcommittee 
chairman. I certainly urge your favorable consideration.
    He can be tough. He can be skilled--he is always skilled. 
He is not always tough. He is always sensitive and responsive 
in trying to work toward a solution.
    His experience over the years I think is extraordinary in 
the sense of having the balance to come into this position. He 
has covered wilderness designations, county payments to improve 
forest management. He has worked on issues such as the Quincy 
Library, which was an effort to bring about a compromise 
between the logging and the environmental groups. Senator Craig 
can perhaps speak specifically of some of the areas where they 
have worked together. Having had the overall responsibility for 
the functioning of that particular area of the Energy and 
Natural Resources Committee relative to resource development, 
his departure is certainly a loss to our committee. It is a 
loss to the Senate. I am thankful that he will proceed here on 
behalf of our country and in a role of service.
    Let me make a final note to give you some idea of how he is 
held by his peers. In 1997, the National Journal developed a 
list of the 100 most influential men and women in the Federal 
Government. Mark Rey was on that list. That gives you some idea 
of how effective he is and how knowledgeable he is. I can't 
think of an individual who is more qualified for this position, 
and I am very grateful that he is willing to serve the Nation 
in the capacity the President has nominated him, and I would 
certainly urge favorably reporting his nomination. It has been 
a pleasure working with him.
    I would like to add for the record letters of endorsement 
from the United Brotherhood of Carpenters and Joiners, the 
International Association of Machinists and Aerospace Workers, 
the National Education Association, the National Federation of 
Federal Employees. Then we move down to such esteemed 
organizations as the Ruffled Grouse Society, Foundation for 
North American Wild Sheep, the Bear Trust International, the 
Campfire Clubs of America, the Safari Club International, the 
Conservation Forests, the Cherokee Safari Club. The list goes 
on and on, and I won't bore you other than to ask that these be 
included in the record to give you some idea of the depth of 
support of this nominee.
    Senator Murkowski. Mark, I wish you well. It has been a 
pleasure working with you, and we look forward to your 
continued contribution.
    The Chairman. Thank you very much, Senator Murkowski.
    Senator Craig.

    STATEMENT OF HON. LARRY CRAIG, A U.S. SENATOR FROM IDAHO

    Senator Craig. Well, Mr. Chairman, thank you. It is good to 
be back before the committee. I still wish I were on the 
committee.
    [Laughter.]
    Senator Craig. Especially with the work that you and the 
Ranking Member, Senator Lugar, are doing now in the shaping of 
a new Farm bill. We know how critical that is to our country, 
and I will play a role in it, but not an active role of the 
kind that I would have, had I been here.
    I also join Chairman, now Ranking Member Frank Murkowski in 
thanking you for expediting these hearings. I have been 
involved with others in encouraging our chairman to move some 
of these nominees as quickly as possible. We need them on the 
ground. We need them working on behalf of the citizens of our 
country, and your choice to have this hearing today for these 
two individuals is extremely important.
    Frank has well outlined the relationship that he and I have 
had with Mark Rey over the last good number of years. I chaired 
the Subcommittee on Public Lands and the Forest Service, and 
over the course of the last good number of years, Mark and I 
have held over 150 hearings on the U.S. Forest Service. Some 
people have said we have turned it upside down and shaken it on 
more than one occasion, all for the purpose of trying to make 
it work, and work better.
    In fact, one observer mentioned that it was the first time 
that kind of comprehensive overview had been done since the 
days of Hubert Humphrey and the crafting of the National Forest 
Management Act.
    Throughout all of this time, there is only one clear thing 
I can say about Mark Rey. He is without question, in my 
opinion, the most knowledgeable person I have ever met on the 
U.S. Forest Service, not only in the way it functions or fails 
to function, but every law, every regulation that interfaces or 
fails to interface to bring about decisions on the ground or 
ultimate decisions by the chief here in Washington.
    When the Bush administration began to recognize Mark for 
the opportunity to serve this country as Under Secretary for 
Natural Resources and the Environment, I thought of no better 
choice than Mark.
    I say that because, while there are those who would 
criticize--and there will be--one of the things that I think is 
most evident in the letters that Frank asked be put in the 
record--and let me add another one, the National Education 
Association--was a broad cross-section of interests that 
support Mark Rey's nomination. That says that he has done a lot 
of things right over the years or he has gained their respect. 
Whether they agreed always with him, they recognized that he 
will listen to them and he will try to work compromise.
    One of the things that Mark and I sought to do over the 
last good number of years--and we have worked very closely with 
Ron Wyden in doing so--was to stop the conflict that has been 
going on out on the public land over the years between many of 
our users and the law and environmental groups to see where we 
could bring balance to policy. In many instances, I think we 
have been able to effect that.
    Let me give you one example that I am most proud of, and 
Mark was really one of the major architects of it, Mr. 
Chairman. We call it the Secure Rural Schools and Community 
Self-Determination Act. You voted for it last year. It became 
law, and it began to reshape the relationship of communities, 
school districts, and counties out in our public land west and 
timbered land areas of the Nation that once received the 
receipts of timber sales to fund their public schools and 
county roads. There was opposition in the beginning, and in the 
end it passed with near unanimity.
    Ron Wyden and I worked very closely together. Ron Wyden 
supports the nomination of Mark Rey, and I understand he has a 
statement--he can't be here today; that will be handed out to 
you--and is actively supporting Mark. Why? Because we worked 
together and we found compromise and we brought coalitions 
together of the kind that you really have to do to make public 
policy work when there are differences of opinion.
    Mark has demonstrated that very, very clearly in his 
ability not only to work with staff but his vast knowledge of 
the issue simply puts him at the head of the line. I think our 
President has chosen wisely. This individual will serve you 
well in all of the capacities that are necessary within this 
area of responsibility, from conservation--and we know how 
critical that is to agriculture and to our farming community 
and to our public lands and water quality and all of the 
resources that are combined there. For those of us who live in 
the public land west and in the public timbered areas of our 
country, we know that the relationship we have with those lands 
is critical to the economic and the environmental well-being of 
our communities, our States, and, of course, all of the 
resources combined.
    Mark has demonstrated that well over the years. I think you 
will--I trust you will find him favorable, and I am very proud 
to be sitting beside the person who I believe will become the 
next Under Secretary for Natural Resources and the Environment.
    Thank you very much, Mr. Chairman.
    The Chairman. Thank you very much, Senator Craig. Again, 
before we move to Mr. Rey, I would like to recognize 
Congressman Rogers for the purpose of introducing Ms. Legg.
    Congressman Rogers, welcome to the committee.

 STATEMENT OF HON. HAROLD ROGERS, A REPRESENTATIVE IN CONGRESS 
                         FROM KENTUCKY

    Mr. Rogers. Thank you very much, Mr. Chairman, and thank 
you for expediting this hearing. You do service to your 
constituents across the country when you schedule these 
hearings to, I hope, confirm these appointees. To the members 
of the committee, thanks for listening to us.
    I join my home State colleague and my senior Senator in 
introducing Hilda Legg to this committee, and I offer you, Mr. 
Chairman, my strongest possible endorsement of her nomination 
to head the Rural Utilities Service.
    Hilda is a native of the Commonwealth of Kentucky. She 
spent nearly her entire professional life in rural economic 
development, playing a major and successful role in helping one 
of the country's most distressed regions turn the corner toward 
self-sufficiency.
    She has a rich and diverse background. She has been a 
teacher. She was a college administrator. She was, of course, 
Senator McConnell's aide in one of his offices in Kentucky. As 
we know, she was the Federal Appalachian development Co-
Chairman and has been a State-based economic development 
official most of her career.
    Few people, Mr. Chairman and members, possess this lady's 
combination of rural development experience and managerial 
experience. I think she is ideal for this job.
    Seven years ago, Hilda was selected by a national search 
committee to become the first director and CEO of a major new 
Rural Development Center based in my congressional district, 
serving a third of the State of Kentucky, but including all of 
the hard-hit sections of Central Appalachia in Kentucky. It was 
created to be a national model for rural economic development, 
and, in fact, it has become just that under her leadership.
    This was an enormously tall order that she took on, and we 
are forever grateful that she agreed to take it on and, more 
importantly, grateful for the great job she did these years in 
bringing it from its infancy to almost maturity.
    She inherited that enterprise in the midst of the 
construction of the building. She quickly moved to accelerate 
the build-out and the completion, to hire the entire 
professional staff, and to implement the various economic 
development programs in that center. She also managed the 
monumental task of designing and installing something brand new 
and unique, even today unlike anything in the country in a 
rural setting, and that is a computer and telecommunications 
network that now connects most of the 40 counties in that rural 
region together so that we can talk, even as we are talking 
here, across the vast distances and chasms that separate the 
parts of that area. For all of the good that that kind of 
communicative capability gives us for the first time in our 
history, it pales beside the computer network that has been 
created that links us with all of the world and is bringing 
thousands now of jobs to a region which has been distressed, 
dominated by the coal industry for all these decades, giving us 
the new jobs of the future. Mr. Chairman, that center is 
enabling my part of Kentucky, long distressed in the 
Appalachian region, the reputation of being the new Silicon 
Holler.
    [Laughter.]
    Mr. Rogers. Under Hilda's leadership.
    The center has become, as we had hoped, a national model 
for implementing economic development strategies in a rural 
setting, and it can be attributed to Hilda's exceptional 
leadership, management, communications, policy development 
skills, all of which would be of great use to us in the country 
as Administrator of the Rural Utilities Service.
    This would be Hilda's third term of executive branch 
service, beginning with her work at the Department of 
Education's Council on the Handicapped, then her role as 
Alternate Federal Co-Chairman of the Appalachian Regional 
Commission where she helped manage perhaps the most effective 
Federal instrument for spurring economic growth in severely 
distressed communities. Clearly, nothing would please me more, 
Mr. Chairman and members, than to have Hilda remain in Kentucky 
because she is going to be very difficult for us to replace to 
continue the effective programs that she has led these past 
years, except the only exception to that would be to have her 
use those exceptional skills on behalf of the country, and she 
is prepared to sacrifice in that regard. Mr. Chairman, 
reluctantly, I am, too.
    Should this committee and the Senate approve her 
nomination, those of us in Kentucky will be secure in the 
knowledge that she has helped advance and shape the region, our 
region and its future, in ways that cannot be reversed, in my 
judgment. Hilda Legg is a strong and energetic manager. She is 
a genuine rural development expert and a progressive leader, 
and I don't think you could find anybody more qualified to fill 
this post.
    Mr. Chairman, I commend Hilda Legg to you with my full 
endorsement, and I hope that she meets with your approval. 
Thank you.
    The Chairman. Thank you very much, Congressman.
    We will now turn to our witnesses.
    The Chairman. Now I would ask both nominees to stand, raise 
your right hand. Do you swear or affirm that the testimony you 
are about to provide is the truth, the whole truth, and nothing 
but the truth, so help you God?
    Mr. Rey. I do.
    Ms. Legg. I do.
    The Chairman. Please be seated. We welcome you to the 
committee, and I will ask for your statements. First, I have 
one question to ask both of you: Do you agree that, if 
confirmed, you will appear before any duly constituted 
committee of Congress if asked to appear? Mr. Rey.
    Mr. Rey. I will.
    The Chairman. Ms. Legg.
    Ms. Legg. I will.
    The Chairman. Thank you both very much, and I would ask you 
now for your statements. We will turn first to Mr. Mark Rey, of 
Canton, Ohio, who has been nominated for Under Secretary for 
Natural Resources and the Environment. Mr. Rey, welcome to the 
committee. Your statement will be made a part of the record in 
its entirety. Please proceed as you so desire, and if you have 
some family members you want to introduce, please do so.

         TESTIMONY OF MARK REY, OF CANTON, OHIO, TO BE 
         UNDER SECRETARY FOR NATURAL RESOURCES AND THE 
           ENVIRONMENT, UNITED STATES DEPARTMENT OF 
                          AGRICULTURE

    Mr. Rey. Upon your kind invitation, Mr. Chairman, I would 
like to introduced my family here today: my wife, Francesca 
Rey; my father, Emmanuel Rey; my mother, Joanne Rey; my 
daughter, Sally Rey; and my sister, Lisa Phillips.
    The Chairman. Very good.
    Mr. Rey. Thank you.
    Mr. Chairman and members of the committee, being nominated 
as Under Secretary of Agriculture for Natural Resources and the 
Environment is the greatest honor that I have been accorded in 
a long career in the natural resources area. It is also the 
greatest challenge I have been asked to meet since arriving in 
Washington, DC, almost 26 years ago.
    I would like to start by expressing my deepest thanks to 
President Bush and Secretary Veneman for their confidence and 
trust in my ability to fulfill the responsibilities of the 
office. I would also like to thank Senator Murkowski and 
Senator Craig for their encouragement and support. Last, I 
would like to thank--express my appreciate to you, Mr. 
Chairman, and your staff for fairly and promptly considering my 
nomination.
    I come before you today sincerely convinced that the job of 
Under Secretary of Agriculture for Natural Resources and the 
Environment is one of the most vital positions in the Federal 
Government. Other offices will undoubtedly make a greater 
contribution in important areas such as national security or 
public health. However, no other assignment carries a greater 
trust responsibility to the American people than the 
stewardship of our Nation's soil, waters, and forests.
    David Ben-Gurion once wrote that, ``The soil is the source 
of life creativity, culture, and real independence.'' Earlier 
this century, Franklin D. Roosevelt spoke that ``Forests are 
the `lungs' of our land, purifying the air and giving fresh 
strength to our people.'' Still earlier, Samuel Langhorne 
Clemens wrote that ``whiskey's for drinking, but water's for 
fighting about.''
    Given the importance of this assignment, I would like to 
begin our time together today talking about what you can expect 
from me, should you choose to confirm my nomination.
    First, if confirmed, I commit to bipartisan collaboration 
in overseeing the stewardship of America's soil, water, and 
forest resources. In my years of service to the Senate, I am 
most proud of the initiatives to which I have contributed that 
passed Congress with overwhelming, bipartisan support. Over the 
past century, our greatest gains in securing the enlightened 
stewardship of our natural resources have occurred when men and 
women of both parties have bridged their differences and found 
common ground on behalf of the American people.
    Second, I will, if confirmed, continue to respect the 
special role reserved for Congress in the Constitution for the 
development and implementation of America's natural resource 
policies. Having spent six years working for the Congress, I 
appreciate firsthand the importance of congressional oversight 
and involvement in the development and implementation of these 
matters. My advocacy for an active congressional role in this 
area will not change with my transfer to the executive branch 
of our Government, should you approve that transfer. In her own 
confirmation appearance before this committee, Secretary 
Veneman stated that she believed ``in working cooperatively 
with Congress.'' I strongly share her belief.
    Third, I offer you my experience. For over a quarter 
century, I have worked with and around the agencies I will 
oversee should you elect to confirm my nomination. A good 
portion of the enthusiasm and humility I bring to this task is 
a reflection of the dedication and skill of the public servants 
working in this area that I have come to know over this time. 
They need attentive critics, but they have earned my respect, 
gratitude, support, and affection.
    Finally, I offer you an open mind. I consider myself to be 
a good and active listener. You won't be hard pressed to find 
people who have disagreed with me. But I think most, if not 
all, of them will confirm that we disagreed without being 
disagreeable. In order to fairly sort out conflicting facts and 
opinions--and, in this policy area, everyone is entitled to 
their own set of each--an Under Secretary should be physically 
and intellectually accessible to all parties. If you choose to 
confirm me, I pledge to keep open both my office door and my 
thinking processes.
    Winston Churchill once wrote that ``we make a living by 
what we get, we make a life by what we give.'' I come before 
you today to respectfully request that you give me another 
opportunity to serve the American people. What I have offered 
about how I would perform this service, I have stated not only 
under oath to you, but before my family and friends assembled 
here today.
    Thank you very much.
    [The prepared statement of Mr. Rey can be found in the 
appendix on page 33.]
    The Chairman. Thank you, Mr. Rey.
    Ms. Legg, welcome to the committee and please proceed with 
your statement.

   TESTIMONY OF HILDA GAY LEGG OF SOMERSET, KENTUCKY, TO BE 
     ADMINISTRATOR, RURAL UTILITIES SERVICE, UNITED STATES 
                   DEPARTMENT OF AGRICULTURE

    Ms. Legg. Thank you, Mr. Chairman. I resisted the urge to 
bring my 16-month-old toddler in out of respect for you, 
Senator, and the committee. But I did bring his photo along.
    The Chairman. There you go. All right.
    Ms. Legg. I would also like to say a thank you of 
appreciation to my mother and my father. My mother like 
millions of Americans, an advanced Alzheimer's patient, 
couldn't be here. My father who is 87, would love to be here, 
but just was not able to make the trip. He was the one who 
taught me around the supper table at night about Government, 
and then about public service, as a member of the Adair County 
Board of Education for years and years. I thank them.
    Mr. Chairman, Senator Lugar and other distinguished members 
of this committee, I am truly humbled and honored to appear 
before you as the nominee of President George W. Bush for the 
Administrator's position of the Rural Utilities Service.
    I am grateful to the President and to Secretary Veneman for 
their confidence in my ability to lead this most important 
agency, and for the opportunity to continue my life's work. 
Serving rural communities has always been at the center of that 
work, and it is an honor to be able to work with such 
distinguished colleagues at this level.
    I would like to thank Senator McConnell and Congressman 
Rogers for their remarks today, but also, for the past 20 
years, their advice and their support. I truly value their 
friendship.
    But today is truly the pinnacle of a most rewarding career. 
One that I admit I did not have the foresight to plan, but one 
where opportunity has knocked and I was able to walk through 
the door. It's a career where service to residents in rural 
communities has always been at the center, a direction that I 
intend to continue.
    Why am I so excited about the opportunity to serve as the 
Administrator of the Rural Utilities Service? It's who I am. I 
was raised on that small family farm, where both parents worked 
outside the home. Farming was not our primary income. In fact, 
it was supplemental at best. Then for 18 years I was married to 
a farmer where agriculture was our primary source of income. I 
assisted with that cow/calf operation, those feeder pigs, and 
the corn and the hay and the tobacco. Except for just a couple 
of short stints in Washington, DC, I've always lived in rural 
communities, the largest being 15,000 people.
    My professional background, included serving as the 
alternate Co-Chairman of the Appalachian Regional Commission 
where I assisted 13 Governors and their states in economic 
development. While serving as Senator McConnell's field rep, 
which as he said, was the most important part of my career, I 
worked with local officials to help secure support from Federal 
programs, as they endeavored very sincerely to grow those 
communities. For the past seven years I have focused on 
economic development in Kentucky's 40 poorest counties, always 
challenging when trying to stimulate economic growth and 
improve the quality of life. Truly, Senators, I have been where 
the rubber meets the road in rural economic development. I am 
very, very proud of the successes of the Center for Rural 
Development. My formal training in sociology and education has 
simply given me the broad perspective of total community 
development and the interrelatedness of the various aspects.
    When we talk about infrastructure in our rural communities, 
that is truly one of the biggest challenges, not only to insure 
the maintenance of water and sewer lines, but also expansions 
necessary to encourage economic growth and new job creation. 
Obviously, utilities always have been, and will continue to be, 
the conduit for development even in this information age, which 
is, of course, the newest infrastructure challenge in rural 
communities. All these computers, wide-area networks, local-
area networks, video conferences and the connectivity that 
links rural communities to the world and brings the resources 
of the world to those rural communities, all run on energy. 
Recently I read a prediction that the Internet will be 
responsible for one-half to two-thirds of all the growth in 
U.S. electricity demand. All these infrastructures are 
important. Workforces simply cannot be development, and new 
jobs cannot be created, companies cannot expand, and rural 
communities will not be viable places for future generations to 
live and raise their families, if the infrastructure is not in 
place. It is critical to the quality of life for rural 
Americans, and I truly cannot think of a more important 
challenge and exciting opportunity for the constituencies that 
I will be working with, and of which I am one.
    I want my 16-month-old son, Dane, to know that feel of 
fresh cool dirt from a plowed field between his toes, and that 
sweet smell of freshly-mown hay, and yet, I want him to be able 
to access the world, and to have the opportunities to develop 
his talents in that environment. It is for his future that I 
take this challenge so seriously, and so gladly devote the 
coming months and years to this service, if you so choose to 
confirm.
    Again, I thank you for your consideration. I seek your 
approval today so that I can begin this new and challenging 
endeavor. I will be glad to answer any questions. Again, thank 
you.
    [The prepared statement of Ms. Legg can be found in the 
appendix on page 37.]
    The Chairman. Thank you very much for an excellent 
statement, Ms. Legg, both of you.
    I will try to take about seven minutes per round of 
questions as we go through the panel. I will start off with my 
seven minutes.
    Mr. Rey, I must say that at the outset, while I have 
received a number of letters in support of your nomination from 
various and sundry entities and groups, I must say that I have 
received some that are highly questioning. I had one here that 
was signed by a number of environmental groups: the Sierra 
Club, the National Environmental Trust, the U.S. Public 
Interest Research Group, the Earth Justice Legal Defense Fund, 
Defenders of Wildlife, Natural Resources Defense Council and 
the Wilderness Society, basically expressing concern. They did 
not say they were opposed to your nomination; they just 
expressed concern about it. Basically they say that Mr. Rey has 
been closely involved with the timber industry and an advocate 
for their policies for over 20 years with a lengthy record of 
positions, and a very specific point of view opposing 
environmental protection. As I said, they did not absolutely 
say that they were opposed; they just said that they were 
concerned.
    Mr. Rey, why are all these groups so concerned? I do not 
know you personally, but would be interested in knowing. I do 
not know why these groups are concerned about you? Do you have 
any view on that at all?
    Mr. Rey. Well, I--it would be presumptuous for me to speak 
on their behalf, but we have had our differences in the past, 
particularly when I had a different role as an advocate for the 
Forest Products Industry, which I was from the mid 1980's until 
the mid 1990's. I think though if you ask all of those groups, 
Mr. Chairman, one of the things you won't hear is that since I 
took on a different role, that of a public servant, that I was 
unavailable to them, that I was unwilling to hear their views, 
that I was insensitive to their concerns. That doesn't mean 
that we agree more or less now, but I do pride myself that I 
don't think you'll find any of those groups who will be able to 
tell you that I denied them a meeting, that I failed to return 
a phone call, that I didn't listen when they had something to 
say.
    The Chairman. I appreciate that. As I said, they did not 
say that they oppose your nomination; they just said that they 
have grave concern. That is the word that they used here. I 
would, as chairman, I say, that these groups, if they want to 
submit statements or if they want to further develop some 
thoughts on that, I would certainly welcome that and I would 
keep the record open for that if they wish to do so.
    I have a few more questions to ask. In the past, Mr. Rey, 
you have promoted fundamental changes to many of the laws that 
you will be charged with enforcing, including the National 
Forest Management Act, and your actions directly impact the 
Endangered Species Act. Will you commit to us to fully uphold 
these laws as they are currently enacted and interpreted by the 
Federal courts?
    Mr. Rey. Absolutely, Mr. Chairman. If confirmed, I will 
fully uphold the laws as they are written.
    The Chairman. Now, Mr. Rey, I do not know if we have a 
difference on this or not, but I am personally a strong 
supporter of the Roadless Area Conservation Rule, because I 
believe it contains a balanced approach to the use and 
conservation of forests. I was disturbed when the Forest 
Service decided to take action to undermine the Roadless Area 
Conservation Rule. Chairman Bingaman just stated, and I quote, 
``The Forest Service will take additional time to provide for 
public comment regarding the Roadless Area Conservation Rule. 
While I am not opposed to additional public comment, I am 
opposed to actions to undo or undermine the rule. Although the 
administration has continually promised to uphold the roadless 
rule, today's announcement appears to be revisiting fundamental 
questions regarding the necessity of the rule.'' I am still 
quoting from Senator Bingaman. ``The American public will be 
closely watching what steps the administration takes in the 
upcoming months regarding this rule. No rule can perfectly 
satisfy everyone, but this one has struck a chord with the 
American people. The Forest Service already has an $8.4 billion 
maintenance backlog on its existing 386,000 mile road system. 
In the absence of the rule, plans to build about 1,160 miles of 
new roads into protected areas would simply add to the Forest 
Service backlog.'' End quote. That is from Senator Bingaman.
    Mr. Rey, how would you respond to Chairman Bingaman's 
statement?
    Mr. Rey. Mr. Chairman, I believe that you and I are in 
agreement on the need to protect roadless values. The rule that 
Senator Bingaman was referring to has, however, been enjoined 
by a Federal District Court. The Court enjoined the rule 
because a single national rulemaking, disposing of all of the 
roadless areas in the 153 National Forests, could not, in the 
Court's view, provide sufficient site-specific information to 
meet the administration's obligations under the National 
Environmental Policy Act. That Court decision is under appeal 
to the Ninth Circuit now, and we'll have to see what the Courts 
do with it.
    But one way or another, Mr. Chairman, I would be happy to 
work with you to protect roadless values. Any disagreement we 
might have won't be over that; it will be over the best way 
that we get to that point, if in fact we disagree at all.
    The Chairman. My staff informs me it is her information 
that the administration is not appealing this case.
    Mr. Rey. The administration has elected not to appeal this 
case, but the intervenors have, so the Ninth Circuit has before 
it all of the arguments available to defend the current rule. 
Unfortunately, or fortunately, depending on how you look at it, 
it was the Ninth Circuit who held that a previous effort to 
address this issue through a single national exercise, could 
not reach the responsibilities of the Environmental Protection 
Act--or the Environmental Policy--National Environmental Policy 
Act.
    The Chairman. The administration is not appealing this 
decision?
    Mr. Rey. The administration is not appealing the decision, 
but the Ninth Circuit will render a decision nevertheless, and 
we will adhere to what the Ninth Circuit directs us to do.
    The Chairman. Can we assume that since the administration 
is not appealing the decision, that they are in favor of 
overturning the rule?
    Mr. Rey. I don't think that's the assumption here. I think 
that the administration, looking at what the judge said, 
decided that a new effort to protect roadless values in a way 
that would meet the District Court's objections was a better 
way to assure the protection of roadless values more quickly. 
The administration has determined that in the interim, any 
activity that occurs in roadless area, if there are any, would 
have to be approved by the chief of the Forest Service.
    The Chairman. Thank you, Mr. Rey.
    Senator Lugar.
    Senator Lugar. Thank you very much, Mr. Chairman.
    Mr. Rey, during our conversation earlier this week, I was 
impressed with the fact that you have an excellent grasp of the 
Forest Service organization and how large that organization is. 
One of the points that you made was that a number of the Forest 
Service persons are not of advanced age, but they are getting 
older, that the problem of recruitment of qualified people may 
well depend upon pay, working conditions, other aspects that 
are competitive with other alternative occupations.
    Would you illuminate that further for the benefit of the 
committee? As you take a look at this large organization, I 
think you said there are 38,000 people, and this is a part of 
your purview as Under Secretary, a huge organization of people, 
what thoughts do you have about bringing new vigor, new 
recruits, the kinds of incentives that are required?
    Mr. Rey. Actually, the observation I made when we met 
applies equally to both the Forest Service and the Natural 
Resources Conservation Service, where in both organizations, 
the demographics of the employee base suggests that we're going 
to lose through retirement a considerable number of skilled 
employees in the relatively near future. One of my greatest 
challenges is going to be working with you and other Members of 
Congress to secure both adequate funding and adequate 
incentives to retain and also to recruit new employees coming 
in.
    Fortunately, there seems to be a considerable amount of 
enthusiasm among college graduates today for work in the 
natural resources and environmental area. I don't think that 
the talent pool that we'll be drawing from will necessarily be 
the problem. I think that the--the real challenge will be to 
find funding and find incentives to hire and then retain those 
employees, and to do that before we lose the experience base 
that we need to train them.
    Senator Lugar. I raise that question, Mr. Chairman, because 
the Under Secretary has these two large organizations as a part 
of the chain of command. He is not involved in a hands-on way 
with either one. They have their independence and their 
offices. But he is the advocate for them. He is sort of the 
interlocutor between us, the President, the organizations, and 
I think that is important. Sometimes we have these nominee 
hearings, we have an impression somebody is going to be out 
there making a rule on roads or something. Well, this is 
important in terms of policy, and he may very well reflect a 
policy in consulting with the President, with the Secretary of 
Agriculture, with us. But I was impressed by the fact his long 
work, longstanding work with our colleagues that we heard from 
this morning, Senator Murkowski and Senator Craig, have given 
him an excellent background, obviously, of the issues that come 
before us in the Congress, but that he has a very good grasp of 
what is required to bring vigor to the organizations that he 
advocates.
    Let me ask a parochial question. The Forest Service does 
operate all over our country, even including states that do not 
have large forests like the midwestern states or my own State 
of Indiana. Our State was once virtually cleared of trees. Over 
the course of time, we are not unique, I found, in visiting 
Vermont one time, that it occurred there, although we think of 
the verdant forests there as substantial, and they have become 
that way in southern Indian as we verge upon our neighbor, 
Kentucky. I am involved on my own farm, a tree farm operation 
that has 200 acres. We cooperate with the Department of Natural 
Resources of Indiana, and the State has taken a vigorous role 
in encouraging the small landowners to plant trees. Why? 
Because most of the trees available now to the timber industry 
in the country, or for furniture makers or other users, are in 
fact privately owned places, and most of them are fairly small. 
One of the ways of boosting income for our farmers is to use 
the back 10 that is not used for anything else, and to see with 
soil samples what might happen.
    What, in the repertoire of the National Forest Service or 
the Conservation Service, is there to help persons, tens of 
thousands of them in my State and surrounding states, who maybe 
have, as we do, just 200 acres in woodlands and in managed 
forests? What kinds of services are there available for them, 
and what kind of encouragement to plant trees, to proceed in 
this, which is often a multi-generational process?
    Mr. Rey. The Forest Service, one branch of the Forest 
Service that's very important to those sorts of programs is the 
State and Private Branch of the agency that works with state 
forestry agencies to deliver technical assistance, and in some 
case financial assistance to forest landowners to encourage 
sustainable forest management.
    As I was preparing for this hearing, I asked a question 
about how much of the state forestry agencies' budget was made 
up by assistance from our State and Private Forestry Program 
for the U.S. Forest Service, and I was surprised to learn that 
probably on the average about a third of the budget of state 
forestry agencies throughout the 50 states are supported by 
Federal financial assistance through the State and Private 
Forestry Program. In some states it's more than half; in other 
states, who have large forestry organizations, it's less. But 
those are important programs because the majority of our forest 
land ownership is in private ownership, not in public 
ownership, and providing both encouragement, assistance and 
incentives to private landowners is one of the most important 
things that the Forest Service does on a day-to-day basis. The 
Natural Resources Conversation Service also has programs that 
assist and encourage farmland owners to plant trees, 
particularly on erodible soils. That program is important 
because it's actually increasing our forest base.
    Both of those are very valuable programs that I look 
forward to working with you to review as we get into the Farm 
Bill debate this coming summer and fall.
    Senator Lugar. I look forward to that opportunity also. We 
are always attempting to think of diversification in behalf of 
farm income. We often think of alternate uses of corn and other 
things that we produce, but clearly, the forest side of this is 
an important supplement of income, and may turn out to be the 
most profitable part for many private landowners. We look 
forward to working with you on these projects.
    I thank you, Mr. Chairman.
    The Chairman. Thank you very much, Senator Lugar.
    Senator Thomas.
    Senator Thomas. Thank you.
    Ms. Legg, we do not want to leave you out of this at all.
    Ms. Legg. That's OK, but go----
    [Laughter.]
    Senator Thomas. What would you think would be currently--
rural electric has been in place for a good long time, and so 
what do you think would be the greatest challenge now, current 
challenge to the Rural Utilities?
    Ms. Legg. I think the greatest challenge, Senator, to the 
Rural Utilities is to provide the service to all the 
constituencies in rural communities at an affordable rate and 
in an efficient manner. I think with the total energy issue 
today we have to ensure that distribution, from the generation 
facilities, is available to our folks who live in our rural 
communities. I think it's service and service in an affordable 
way. I think it's still around 15 percent higher at this point, 
even in my state, to get electricity out to our rural 
communities, and we're one of the lower states in terms of 
cost, so I think that will be an issue that we'll have to look 
at in context. I think working with Vice President Cheney and 
Secretary Veneman, who serves on that special task force to 
look at energy, to ensure our rural communities have service. 
If confirmed, I would look forward to working with them.
    Senator Thomas. We have been, just came from a hearing on 
electricity over in Energy, and do you see, particularly the 
G&Ts being involved with the regular movement along with the 
other utilities pretty much the same, so that they can move 
their power, or do you see them separate from the investor-
owned utility?
    Ms. Legg. Senator, I think it's going to take all entities 
working collaboratively to--again, to bring that service to our 
rural communities. I would look forward to discussions with all 
folks, all the G&Ts, the co-ops, everyone, to be involved in 
that discussion, as to how we best accomplish our goal.
    Senator Thomas. Last year the Congress passed a bill that 
establishes a guaranteed program for satellite TV delivery. Are 
you familiar with that program?
    Ms. Legg. I've had a quick conversation about that.
    Senator Thomas. I guess I hope that you will be able to 
move in and do something about having the regulations written 
and so on, so when that is funded, that this will be an 
opportunity to provide access to rural folks, the same kind of 
TV that others have.
    Ms. Legg. Senator, I can assure you that if I am confirmed, 
that we will be in discussion with your staff about those 
issues, and the promulgation of the regulations, as well as the 
other entities at USDA about that.
    Senator Thomas. Local TV is something of a problem.
    Ms. Legg. Absolutely.
    Senator Thomas. Mr. Rey, there has been some concern that 
because of the rules and regulations that go out in the non-
point source water, so on, that NRCS has become sort of a 
regulatory agency as opposed to a technical assistant. How do 
you react to that?
    Mr. Rey. The--I'm not sure, Senator, that NRCS has been 
perceived as a regulatory agency so much as some of the new 
rules involving non-point sources imposed additional 
regulations on farm landowners that they have trouble dealing 
with. Today, as EPA struggles at looking with the total maximum 
daily load rules and the concentrated animal feeding operation 
rules, the administration has formed an interagency task group 
between EPA and NRCS, to work together on making those rules 
effective in improving water quality, but effective as well in 
securing the cooperation of farmers and feedlot owners to 
accomplish those objectives. I had the opportunity to sit in 
briefly on one of the meetings of the two agencies yesterday, 
and I was struck by how well they were working together to 
accomplish that end.
    What I would commit to you, Senator, if I'm confirmed, is 
to increase NRCS's involvement in those regulations to make 
sure, one, that they're effective in improving water quality, 
but, two, that they retain NRCS's cooperative relationship with 
farm landowners because I think we have made our greatest 
strides in controlling non-point source pollution in the past, 
when that relationship has worked to the advantage of both the 
environment and farm landowners.
    Senator Thomas. Nobody argues, of course, with the idea of 
clean water and so on, but I think both in the case of some of 
the Forest Service questions and certainly these questions, it 
seems like perhaps there needs to be more involvement of local 
people and more involvement of state agencies, more involvement 
of the state conservation associations and so on. Would you 
find that to be something you would like to promote?
    Mr. Rey. If I am confirmed, I will work to make NRCS an 
active partner in those programs, working through the state 
conservation organizations and the other delivery systems that 
we have in USDA.
    Senator Thomas. That is one of the things, as you well know 
better than I, and the chairman just stepped out, but, you 
know, there is all kinds of different forests, U.S. forests 
around, and they are pretty unique, and each one of them has a 
forest plan that has to be done every certain period of years. 
Yet some of the rules have been put out here from Washington 
without much attention to the individualism or the uniqueness 
of the various forests, which those studies should be able to 
put forth. I hope that we do not get the one-fits-all kinds of 
things on all these issues. I know that you have been involved 
in that. Thank you.
    The Chairman. Thank you very much, Senator Thomas.
    Senator Crapo.
    Senator Crapo. Thank you very much.
    Ms. Legg, I think you are going to miss most of the 
questions today, and you can take that as a fortunate thing, I 
think.
    [Laughter.]
    Ms. Legg. I do. Thank you, Senator.
    Senator Crapo. Idaho has about 20 million acres of National 
Forest land that I want to talk to Mr. Rey about here for a 
minute. Mr. Rey, the Forest Service recently entered into an 
interagency agreement with the National Marine Fisheries 
Service to focus on the need to get consultations done on the 
forests, particularly those that are most at high risk with 
regard to catastrophic wildfire and present a threat to the 
communities in the West. Are you aware of that agreement?
    Mr. Rey. I am, Senator.
    Senator Crapo. In my State alone, the National Marine 
Fisheries Service has opened a new office in Grangeville and in 
Salmon, and I think in total there are at least 31 new National 
Marine Fisheries Service biologists that have been located in 
western communities in order to get consultations done on 
forests that are at the highest risk for wildfire. Do you 
believe, if confirmed, that you have the authority that you 
need to make sure that these consultations are completed in a 
timely manner and that these on-the-ground projects can 
proceed?
    Mr. Rey. Thank you, Senator. I believe that authority 
exists, and I'm encouraged by the quick action of the National 
Marine Fisheries Service to hire those biologists. Last summer, 
during and immediately after the fire season, when the 
committee that I staffed held hearings on both the fires and 
fire recovery, one of the things that the Forest Service, and 
for that matter, the Interior Department explained to us, is 
that one of the impediments in moving forest rehabilitation 
projects forward was a lack of resources at the Fish and 
Wildlife Service and the National Marine Fisheries Service to 
engage in Endangered Species Act Section 7 consultations to 
assure that those projects didn't result in jeopardy to a 
threatened endangered species.
    It wasn't a case where the Fish and Wildlife Service or the 
National Marine Fisheries Service were being uncooperative; 
they simply didn't have enough people to get the job done. One 
of the things that the Appropriations Committee did, as a 
result of that oversight testimony, was include funding in last 
year's Interior and Related Agencies Appropriations Act to 
bring those people on board. We subsequently found that we 
needed to provide additional statutory authority to transfer 
the money from the Forest Service to the National Marine 
Fisheries Service, and your committee, the Environment and 
Public Works Committee, promptly passed enabling legislation to 
get that done this past spring.
    Now those National Marine Fisheries Service biologists are 
on the ground. I am very encouraged that they are actually 
being placed in places like Grangeville and Salmon, close to 
the resource so they can observe what's happening firsthand. My 
commitment to you is that, if I'm confirmed, I'll make sure 
that the Forest Service and they are working hand-in-glove to 
get this work done as quickly as possible.
    Senator Crapo. Thank you. I appreciate that. It is always 
kind of an awkward dilemma for those of us who want to see this 
work move ahead rapidly to recognize that we have to have a lot 
more Federal regulators moved into our State in order to get it 
done, but we recognize what is going on. We do hope that, with 
your leadership and that of others in the administration, that 
we can get these consultations completed very rapidly.
    I would ask you, if confirmed, if you would keep my office 
apprised of any obstacles that you may run into that would 
prevent these consultations and projects from moving ahead 
expeditiously.
    Mr. Rey. I'm happy to do so.
    Senator Crapo. Thank you. I just have one other area of 
inquiry right now, and that is, as I am sure you know, because 
we have worked together very closely in the past, I have been 
pretty critical of the way that the Forest Service allocates 
its funding.
    One of the problems that we often face out in our forests 
in the West, which, frankly, you just alluded to, in terms of 
the lack of personnel there to get the job done that we need 
done in terms of proper management of the forests, and this 
includes everything from getting the biologists there for the 
consultations to making sure that the camp grounds are kept up, 
that there is the adequate enforcement of the need for 
management on the forest grounds or any number of things.
    What we often see is that critical and needed activities in 
our forests are not undertaken by the Forest Service, and the 
explanation that we get is that they do not have enough money 
in their budget to get it done. In fact, we are often told that 
their budgets are shrinking, rather than growing, with the 
needs that they face.
    When I am told that, I come back here scratching my head 
because I remember voting on the appropriations for the Agency, 
and I remember the appropriations going up, not down. I have 
inquired a number of times about this and have found out that, 
in fact, the appropriations have annually, since I have been in 
Congress, gone up, not done. Almost annually the amount of 
money allocated to the local forests has gone down, not up.
    I want to know where that money is going. What I have found 
out so far is that it is going to more heavily populated urban 
areas or to the central bureaucracy of the Forest Service. I 
think that is wrong. First of all, I would like to have your 
perspective on that, and I hope that we can address this 
discrepancy in the future, as we work together, if you are 
confirmed.
    Mr. Rey. Thank you, Senator.
    The data I've seen in budget allocation over the last 
several cycles have shown, as you indicated, that more funds 
are be--were being retained longer in the Washington office, as 
opposed to being distributed to the field. In his first 
appearance before the Energy Committee, at a hearing which I 
staffed, the new chief of the Forest Service, Dale Bosworth, 
stated, without prodding, that one of his first objectives was 
going to be to reverse that trend and to get more money out of 
the Washington office and into the field faster, and if I'm 
confirmed, I'll be helping him in making sure that we 
accomplish that goal.
    Senator Crapo. I appreciate that. In fact, Mr. Bosworth was 
one of those regional forest managers who was getting short 
shrifted on the budget when he was out in the field. I am glad 
to see him now back in headquarters, if you will, because I 
know that he understands the problem, and I appreciate his 
comments, as well as your commitment.
    I have no further questions at this point. Although, Mr. 
Chairman, I did have a brief statement that I did not give at 
the beginning and would ask unanimous consent that it could be 
made a part of the record.
    The Chairman. Without objection, absolutely, Mr. Crapo.
    Senator Crapo. Thank you.
    The Chairman. Thank you very much.
    Senator Allard.
    Senator Allard. Mr. Chairman, I guess you are getting a 
pretty heavy dose of Western issues here, as it applies to the 
forest.
    [Laughter.]
    Senator Allard. I am going to join the chorus.
    The Chairman. That is all right. You get a heavy dose of 
Midwestern issues all the time.
    [Laughter.]
    Senator Allard. We have got a little balance on this 
committee, I see.
    The Chairman. That is right.
    [Laughter.]
    Senator Allard. But, you know, the State of Colorado finds 
itself frequently entwined in forest and water issues. I share 
the concerns of my colleagues, certainly, from Idaho and 
Wyoming, about the way the Forest has disregarded the State's 
role on water issues and has, at times, stepped in and claimed 
in water rights, that the Federal Government has supremacy. In 
water in Western areas, is frankly a property right. When the 
government drops in and says, ``We want to take first priority 
in an allocation in a river,'' that means that all of the other 
people who have purchased water for their farm or ranch, or a 
city who is taking care of their municipal needs, find 
themselves moving down the ladder. That type of policy concerns 
me, and I'm apt to get in touch with you whenever the issue of 
Federal Reserve water rights comes up.
    I would like to hear some of your thoughts on a Federal 
Reserve water right.
    Mr. Rey. Before you came in, Senator Allard, I recounted a 
quote attributed to Mark Twain at the end of the last century, 
wherein he said that, in the West, whiskey is for drinking, but 
water is for fighting about.
    As I've observed the situation in Colorado, I think my 
conclusion is we probably need more whiskey to work through 
those problems.
    [Laughter.]
    Mr. Rey. The Supreme Court I think has made it abundantly 
clear that the Federal Government must assert any reserved 
water rights that it wishes to maintain through State court--
State Water Court proceedings. Over the last several years, 
we've tried to do that, I think.
    Where the Forest Service, in my judgment, has been most 
successful in identifying and securing in-stream flows 
necessary for fish and wildlife populations is where it has 
done that through a collaborative process with the States, 
through State proceedings; for instance, using the 1973 
Colorado process for that purpose.
    Where the Forest Service has tried to assert water rights 
that were ambiguous, without that local collaboration, they 
have been less successful, except in instances where a 
threatened or endangered species or a wild and scenic river 
have been involved.
    Generally speaking, though, it would be my preference, if 
confirmed, to, in as many cases as possible, take the former 
course and to work collaboratively through State proceedings 
with the other water users to try to secure a mutually 
acceptable outcome for all interests.
    Senator Allard. Well, I appreciate your answer in that, 
because all States are a little bit different. Although most 
Western States have the doctrine of prior appropriation that 
originated in Colorado and was eventually adopted by many of 
the other Western States. But the Eastern States have a 
different type of water law, and I am glad to hear that you are 
willing to work with Western States in that. That gives them 
some ability, at least, to communicate about how the system is 
going to react with each of the individual State water laws and 
court systems that have been set up within the States. I think 
those of us in the West, in Colorado, Wyoming, and Idaho would 
appreciate that approach.
    I cannot emphasize how important it is, whether we are 
talking about forest management issues, water issues or any 
kind of natural resource issue, that there be some mechanism 
for local input. I would like to hear any thoughts that you may 
have on how we might allow more local input from people that 
are impacted through forest decisions or water decisions or any 
natural resource decisions in these States and how we might 
enhance that. If you have any thoughts on that, I would like to 
hear what those might be.
    Mr. Rey. I think one opportunity that we have right now 
that is exceptionally important that the Forest Service is well 
underway in implementing are the local advisory committees that 
were established by a piece of legislation that Senator Craig 
referred to earlier today, the Secure Rural Schools and County 
Payments Act.
    I think those local advisory committees are going to go a 
long way to providing a forum for collaboration with local 
people, of a variety of views, to work together in securing 
forest management decisions that are reflective of national 
environmental priorities and national environmental 
requirements, but nevertheless sensitive to local site-specific 
conditions and local needs.
    So I'm very optimistic that, as those committees are up and 
running, they will provide a local forum for people to work out 
their differences, and that in doing so, the differences that 
are presented to you, the Congress, here in Washington, DC, are 
going to be vetted to the point that they're a little bit less 
contentious and maybe easier to resolve.
    Senator Allard. One other area that I want to bring up and, 
again it has to do with water, and has attempted to be 
implemented by the Forest Service in Colorado. Western States 
continue to share this concern because of the precedent it 
begins to set. This is the issue of bypass flows.
    We have a ditch that perhaps was put in place even before 
it was designated as a national forest. The Forest comes in 
every so often and allows a renewed permit to allow the ditch. 
In some instances they said, ``Well, we will renew your permit, 
but we want a certain percentage of the water out of that 
ditch.'' I have a real concern about that. I would be more 
comfortable if they would just ask for a flat fee because the 
value of water, as it increases, almost creates a windfall for 
the Federal Government. Over time, it also means that a farmer 
or rancher that has relied on that ditch for various reasons is 
going to eventually dedicate all of that water over to the 
Federal Government. It is the issue of this becoming a takings 
that concerns me.
    I do not expect you to be up on all of those issues on 
those things because they do get a little bit complicated, but 
I think that your fundamental thoughts about local control and 
working with the States on water should help resolve those 
conflicts.
    Thank you.
    Mr. Rey. Thank you.
    Senator Allard. Mr. Chairman, thank you.
    The Chairman. Thank you very much, Senator Allard.
    Ms. Legg, I noted, with interest, on your statement that 
you said, ``Utilities have been and will continue to be the 
conduit for development, even in the Information Age, which is 
of course the newest infrastructure challenge to rural 
communities.'' You mentioned that in passing there.
    Interesting reading is the history of the development of 
the Rural Electrification Act and the debate that took place in 
the Senate during that time. If you have nothing better to do 
with your time some evening, I recommend it.
    Ms. Legg. Yes.
    The Chairman. It is an interesting read about how there 
were Senators who said that if people want to live in rural 
areas that is their right to do so, but we do not have to 
provide electricity to them because it costs too much money, it 
is cost-ineffective and to run all of those lines out there for 
miles to serve one farmer, does not make any sense. This is a 
debate that took place on the Senate floor.
    Well, we persevered and it got through. Of course it was 
not just that line to that farmer. It was the lines that went 
out to our rural communities that enabled us to build colleges, 
and community colleges, and schools, and manufacturing came to 
our small towns and communities, so the whole thing blossomed 
because of that.
    Having said that, it seems to me that, getting into the 
21st century, we still have utilities that are needed in our 
rural areas. You touched on that, and that is the whole area of 
broad-band access. If we do not have broad-band access to our 
small towns and communities, that means they are on the other 
side of that digital divide. What mail order company or what 
firm that might employ a few people to run a phone service or 
clearinghouse or something is going to locate in a small 
community if they do not have access, and rapid access, through 
broad-band technology?
    We know right now that a lot of farmers are getting their 
income off-farm. I stated this fact the other day. I think it 
is true in my State--I do not know about Indiana--but I think 
only 1 of 15 who live in rural Iowa farm. The rest live in 
small towns and communities, and even those who farm are 
getting off-farm income.
    I think we have to provide some basics for these people in 
these communities, and so a lot of people say that your job, 
your future job, is basically completed in terms of utilities. 
We have got the wires out there, we have got the lines, and so 
we do not need anything else. But I would like to have your 
thoughts on how you would lead the charge towards the new 
concept of the Rural Utility Services being involved in the 
utilities of the 21st century, which is Internet service and 
broad-band access to our small towns and communities. How do 
you see your job as promoting that aspect and coming to this 
committee to ask us for our help and our support to give you 
the necessary wherewithal to carry that out. So how do you see 
that?
    Ms. Legg. Senator, I think that's probably the most 
exciting aspect of RUS at this point in time. It is a new 
economy, it is knowledge base, it is the Information Age. We 
cannot deny that. We cannot run from that.
    Now, technology will not--it's not the silver bullet. It 
will not cure all of our rural communities' ills, but it has to 
be available in order for us to be at least competitive in the 
global economy, whether it's our agricultural products, whether 
it's bringing educational opportunities, whether it is to 
consult with a medical professional, many States away. It is 
absolutely critical, in terms of economic development, that our 
rural communities, and that our children in those communities, 
can interact with the world.
    It's not just about education, it's about pure economic 
development. It's about bottom-line dollars and cents, and the 
name of the game is speed. How fast can you get voice, data and 
video over that infrastructure? In Kentucky, as the Congressman 
alluded to Silicon Holler, we call it at the Center rising 
above the mountains. It's not the road--it's not the farm-to-
market road, but it is the way that we do business today, and 
so we call it the information highway, and of course all of the 
on ramps and off ramps. But it's all about speed. It's all 
about economic development.
    As far as I'm concerned, Senator, I would be eager to work 
with your folks here on the Hill, obviously, the other entities 
throughout the Federal Government and our local communities to 
help them understand, No. 1, that rural communities need it, 
how to use it, and how to make it work for our communities to 
grow.
    Thank you.
    The Chairman. I appreciate that. Going from that back to 
the old system. I do not know how you did in Kentucky, but we 
started a number of years ago building rural water systems in 
Iowa. Maybe you have them in your area too. They have been 
great, but we have a long way to go.
    There are still many, many communities in my State and all 
over the country that need clean, safe drinking water. In many 
cases, environmental regulations require the upgrading of rural 
water systems, but the people in those communities do not have 
the financial wherewithal to do that. The EPA comes in and 
says, ``You have got to meet these standards.''
    The people say, ``Well, we would like to meet those 
standards,'' but they just do not have the tax base and the 
resources to do that. They are very limited. I am asking for 
any thoughts that you might have on what we can do to help our 
communities with two things: to expand the rural water systems 
beyond what we have right now, and, again, thinking about it in 
terms of the lines, the old electric lines, and people say, 
``Well, it is expensive.'' Well, it is not all that expensive.
    Second, what can we do to help our small communities 
upgrade their water systems to meet the new regulations?
    Ms. Legg. Senator, those are very important issues. As 
we've been talking about all morning in some form or fashion, 
it's purely vital to our existence. I know what it's like to be 
on the county water system. I know what it was like when we 
first got on the county water system, too. I understand that 
need very, very much. I also know that it's an economic 
development issue, as well as a quality of life, and a health 
issue.
    What will we do? Obviously, regulations are always more 
difficult to adhere to in rural communities because of the lack 
of the tax base and the expense to do so. But I can assure you, 
if I am confirmed, that I will be working to try to address 
those issues, and along with the EPA, get that those 
regulations in place. We will be a loud voice of advocacy for 
those rural communities so our individuals can have clean 
drinking water and we can maintain the systems we have already 
invested in.
    The Chairman. I appreciate that. I just want you to know 
that I come from--you say you come from a small town. How big 
is your hometown?
    Ms. Legg. Actually, it was about 4,000. That was the county 
seat, and I lived out in the county.
    The Chairman. That is a big city.
    [Laughter.]
    Ms. Legg. Well, I lived in Knifley. Now, that was just a 
couple of hundred, at most.
    The Chairman. My hometown has 150 people. I still live 
there. I live in the house in which I was born. Very few people 
can say they actually wake up in the room in which they were 
born, but I can say that.
    Ms. Legg. That is true, Senator.
    The Chairman. But I remember when they came through in the 
1970's, and they tested all of the wells and not one well 
tested fit to drink, not one well in our town, to which my 
political opponents always said, ``No wonder what is wrong with 
you, Harkin. Drinking that bad water all your life.''
    [Laughter.]
    The Chairman. But we got an extension of a water line over, 
through Rural Water, and we got an extension in. What a 
blessing it was for people. Of course, now we have a sewer 
system.
    Ms. Legg. Big time.
    The Chairman. Big time, now. Of course, that caused some 
problems, but I am not going to go into that. But I also have 
firsthand experience of what it means to get good water in our 
hometown. I would look forward to working with you on that.
    I have some more questions for Mr. Rey, but I will yield to 
you, and now we will go around again here.
    Senator Lugar.
    Senator Lugar. Thank you very much, Mr. Chairman.
    Ms. Legg, following through on Senator Harkin's questions 
about the Internet and the broad-band, one of the problems that 
is highlighted by most of the financial press is that many of 
the telecommunications companies in the private sector have 
extended their lines, their facilities to a point that they are 
nearly in bankruptcy. In other words, the bond issues, the 
borrowings that have been required to lay out all of this have 
been sizable, and although the market may respond in due 
course, people may come on line, small towns may use it, there 
seems to be a time-lag factor here.
    I am curious, as you take a look at the management of what 
amounts to a very, very large utility that you are managing on 
behalf of the taxpayers, what are the policies of Rural Utility 
Services in terms of borrowing, extension of services and what 
have you? We had a pretty broad debate a couple of years ago 
about the need to have an Internet that united all of us in 
America, and especially rural America in remote areas, and, 
generally, Congress subscribes to that idealism.
    But, finally, you and your cohorts are left, as you say, 
where the rubber hits the road, to actually bring this into 
actuality, to raise the funds or to take the risks, in some 
cases, that are required. Have you given this thought and, if 
so, what kind of policies do you find there now and what kind 
of borrowing authority or other recommendations are you likely 
to make as you come to the Congress for budget authority?
    Ms. Legg. Senator, I have given some thought in terms of, 
and have been involved in trying, if you will, to create the 
demand from that private sector, what forces or not just 
forces, but entices the providers to provide service there. It 
is sort of a ``chicken or egg'' situation, which comes first?
    Senator Lugar. In other words, the public utility 
encourages the private people to make the investment so that 
the public is not at risk in these borrowings and what have 
you.
    Ms. Legg. Right. I think it's always a juggle of that 
public/private, if you will, concern and demand. To tell you I 
would be able to say today that I have some policy 
recommendations, I simply would like to ask if I could get your 
input on that in the future and also become more involved with 
the policy development folks at USDA. I've been hoping that 
this confirmation hearing would give me an opportunity to do 
that and would look forward to working with you.
    Senator Lugar. Very well.
    Let me ask to what extent now in the history of our country 
is everyone connected, at least in terms of basic electrical 
services? Is everybody online there?
    Ms. Legg. Electric just from the electricity demand?
    Senator Lugar. Yes. Let us take that for starters.
    Ms. Legg. Electricity demand is much, as you would guess, 
is much more available than the Internet connectivity.
    Senator Lugar. Right.
    Ms. Legg. Internet is about 7.3 percent in our rural 
communities, in terms of that connectivity. It's under 10 
percent.
    In the rural electrification, I don't have an exact number 
to give you, but my perception from working with our folks is 
that it's more of a matter of looking at the last mile, if you 
will, of that connectivity. It goes back to Senator Harkin's 
statement about if they live out that far, then they need to 
just run their own electric out there or their own line. We 
hear those discussions. I've been a part of those discussions. 
It's not just 65 years ago with the beginning of the REA. There 
are still folks who have that discussion today.
    Senator Lugar. Right now, yes.
    Ms. Legg. I think what we'll be looking at is, again, those 
that have been left out, those last-mile connections are what I 
would like to get involved in as we pursue this issue.
    Senator Lugar. I appreciate that because I, you know, 
clearly the excitement now is the Internet. As you say, you've 
got about 7-percent-plus online there, but the old debate of 60 
years ago is not really over with regard to basic electric 
services.
    Ms. Legg. That's right.
    Senator Lugar. Beyond that, other services that are 
intermediary to that, and that takes some doing. It has been a 
debate with the telephone people for quite a while as to that 
last phone.
    Ms. Legg. That's right.
    Senator Lugar. What really the obligation is, either 
private or public, in that respect. As you get into the 
position think, in terms of your further testimony before this 
committee or others, as to what you find, so that we have some 
parameters for what is still out there, what sort of challenge, 
and what the expenses are, and what the public policy 
recommendations that you and others have ought to be.
    Ms. Legg. I look forward to that discussion. You can't run 
those computers unless you have electricity, and you need a 
drink of water throughout the day if you're going to sit at 
that computer all day. I look forward to that, Senator.
    Senator Lugar. Thank you very much.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator.
    Senator Crapo.
    Senator Crapo. I do not have any more questions at this 
point.
    The Chairman. Thank you.
    I just have a couple. Mr. Rey, much of your background and 
the focus here has been on forest issues, but you have another 
important aspect that will come under your jurisdiction that 
I'm maybe more interested in called the National Resources 
Conservation Service. I just want to know what, in your 
background, might demonstrate that you can lead the NRCS, and 
how it works, and what its programs are.
    Can you just briefly give me some of your thoughts on the 
NRCS, and what its charges are, and how you might lead that 
agency.
    Mr. Rey. Certainly. One of the reasons I was enthusiastic 
about taking on this assignment, when the President offered me 
the opportunity, is that from 1976 through 1984, while I worked 
for the forest products industry, I was working on nonpoint 
source pollution issues from agriculture and silvaculture. 
During that time period, I had the occasion to work alongside 
the then-Soil Conservation Service in developing and 
implementing the first nonpoint source pollution control 
programs developed since--developed as a result of the 1972 and 
1977 Clean Water Acts.
    During that time period, we had to sort out the debate 
about what the best way to address the water quality problems 
associated with runoff from rural lands, whether they be forest 
lands or farmlands, could be done, and I enjoyed the 
opportunity to work on those first programs.
    I was enthusiastic when the President offered the 
opportunity to come back, now 15 years later, to see what kind 
of progress that's been on those issues. On the one hand, as I 
began to read and be briefed on them, I was struck by the fact 
that some of the issues are still with us: wetlands protection, 
runoff from animal feedlots, et cetera.
    On the other hand, I was struck, at the same time, by how 
much progress we'd made, not only through the implementation of 
the Clean Water Act, but through the very creative and 
worthwhile programs that were developed through the Farm bills 
in 1985, 1990, and 1996, in which I didn't participate, but 
just watched as an observer.
    One of the exciting challenges that this job will bring to 
me is to work with you in the development of this new Farm bill 
and look at the EQIP program, the WRP, the WHIP program, and 
the FFP to see how we might improve on what we've done since 
you first put some of those programs into place over the last 
15 years, when I dropped out of that debate and went into a 
different area.
    Some of the programs I find, as I've reviewed them, are 
extremely creative. The FFP program, in particular, is one 
where I'd like to work with the committee, if confirmed, to see 
if we can improve on that program, both by expanding its reach 
through the Farm bill provisions, but also looking at creative 
ways to involve other partners in purchasing easements for 
farmland protection.
    I do have some background in these areas. It's not as 
recent as my work with the Forest Service, but I have worked a 
lot with the then-SCS, now the NRCS, and look forward to 
working with them and with you, again, if confirmed.
    The Chairman. I appreciate that, and again I hope that you 
will be very diligent and careful in the personnel who run the 
professional end of the NRCS. They should be professionals, 
they should have a good professional background, and I would 
hope that, in no way, would any kind of political 
considerations be involved, in any way, in the selection of 
those professionals who need to run the Soil Conservation 
Service. They should be people with good backgrounds, and there 
should not be any thought of any political involvement there.
    Last, I would just say, as you mentioned, we are about to 
embark on a new farm bill, I hope that the new Farm bill will 
have as its centerpiece, a new conservation approach. I have 
been working on one for a number of years now. It just seemed 
odd to me that we, in the past, in fact, Senator Lugar brought 
this up the other day, and I am going to try to remember the 
figures, do you remember those, percentagewise, how much we put 
into land idling and how much we put into production?
    Senator Lugar. It is 85/15 now, and it used to be the other 
way around.
    The Chairman. Yes. Now we put 85 percent of our 
conservation money in land idling and only 15 percent in the 
producing side. Fifteen years ago, in 1985, it was 90/10--90 
percent, I think----
    Senator Lugar. The other way around.
    The Chairman. The other way around.
    While the CRP is a good program, I have supported the CRP, 
there are some moves now to try to expand it to 45 million 
acres, and I think that would be devastating, in many ways, for 
our small towns and communities.
    It is my idea to focus more of our attention on 
conservation on working lands. I hope you will take a look at a 
bill that I introduced with Gordon Smith from Oregon, and I 
think Representative Thune, is the main sponsor on the House 
side. It is a bipartisan approach, bicameral. The idea is to 
begin shifting and focusing funds to help farmers on producing 
land. We have titled it the Conservation Security Act. I hope 
you will take a look at that and keep an open mind about 
working with us on this aspect of the Farm bill.
    If you have any thoughts on it now or anytime, I would be 
glad to listen to those, but maybe you have not had a chance to 
look at it.
    Mr. Rey. In all honesty, Senator, I haven't really had a 
chance to look at either your proposal or any of the other ones 
that are being circulated.
    The Chairman. Fair enough.
    Mr. Rey. I know that the Department is working on its own 
proposal diligently to be able to participate with you in the 
Farm bill drafting.
    I would like, at a subsequent time, if confirmed, to visit 
with you and Senator Lugar and go through these alternatives in 
more detail.
    The Chairman. I appreciate that..
    Do you have any more questions?
    We thank you both for being here. We thank you both for 
your past public service and your future public service. We 
wish you well. We look forward to working with you in the 
development of the new Farm bill, which we will be moving on 
fairly rapidly, and beyond that just to work with you on all of 
these issues.
    [The information of Mr. Rey follows:]
    [The information of Ms. Legg follows:]
    The Chairman. If there is nothing else to come before the 
committee, the committee will stand adjourned.
    Thank you very much.
    Ms. Legg. Thank you.
    Mr. Rey. Thank you, Mr. Chairman.
    [Whereupon, at 12:15 p.m., the committee was adjourned.]
      
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                            A P P E N D I X

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                         QUESTIONS AND ANSWERS

                             July 26, 2001



      
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