[House Hearing, 108 Congress]
[From the U.S. Government Publishing Office]



 
                       CALFED'S CROSS-CUT BUDGET

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

                           OVERSIGHT HEARING

                               before the

                    SUBCOMMITTEE ON WATER AND POWER

                                 of the

                         COMMITTEE ON RESOURCES
                     U.S. HOUSE OF REPRESENTATIVES

                      ONE HUNDRED EIGHTH CONGRESS

                             FIRST SESSION

                               __________

                              May 15, 2003

                               __________

                           Serial No. 108-20

                               __________

           Printed for the use of the Committee on Resources



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                         COMMITTEE ON RESOURCES

                 RICHARD W. POMBO, California, Chairman
       NICK J. RAHALL II, West Virginia, Ranking Democrat Member

Don Young, Alaska                    Dale E. Kildee, Michigan
W.J. ``Billy'' Tauzin, Louisiana     Eni F.H. Faleomavaega, American 
Jim Saxton, New Jersey                   Samoa
Elton Gallegly, California           Neil Abercrombie, Hawaii
John J. Duncan, Jr., Tennessee       Solomon P. Ortiz, Texas
Wayne T. Gilchrest, Maryland         Frank Pallone, Jr., New Jersey
Ken Calvert, California              Calvin M. Dooley, California
Scott McInnis, Colorado              Donna M. Christensen, Virgin 
Barbara Cubin, Wyoming                   Islands
George Radanovich, California        Ron Kind, Wisconsin
Walter B. Jones, Jr., North          Jay Inslee, Washington
    Carolina                         Grace F. Napolitano, California
Chris Cannon, Utah                   Tom Udall, New Mexico
John E. Peterson, Pennsylvania       Mark Udall, Colorado
Jim Gibbons, Nevada,                 Anibal Acevedo-Vila, Puerto Rico
  Vice Chairman                      Brad Carson, Oklahoma
Mark E. Souder, Indiana              Raul M. Grijalva, Arizona
Greg Walden, Oregon                  Dennis A. Cardoza, California
Thomas G. Tancredo, Colorado         Madeleine Z. Bordallo, Guam
J.D. Hayworth, Arizona               George Miller, California
Tom Osborne, Nebraska                Edward J. Markey, Massachusetts
Jeff Flake, Arizona                  Ruben Hinojosa, Texas
Dennis R. Rehberg, Montana           Ciro D. Rodriguez, Texas
Rick Renzi, Arizona                  Joe Baca, California
Tom Cole, Oklahoma                   Betty McCollum, Minnesota
Stevan Pearce, New Mexico
Rob Bishop, Utah
Devin Nunes, California
VACANCY

                     Steven J. Ding, Chief of Staff
                      Lisa Pittman, Chief Counsel
                 James H. Zoia, Democrat Staff Director
               Jeffrey P. Petrich, Democrat Chief Counsel
                                 ------                                

                    SUBCOMMITTEE ON WATER AND POWER

                   KEN CALVERT, California, Chairman
        GRACE F. NAPOLITANO, California, Ranking Democrat Member

George Radanovich, California        Calvin M. Dooley, California
Greg Walden, Oregon                  Jay Inslee, Washington
Thomas G. Tancredo, Colorado         Raul M. Grijalva, Arizona
J.D. Hayworth, Arizona               Dennis A. Cardoza, California
Tom Osborne, Nebraska                George Miller, California
Rick Renzi, Arizona                  Ciro D. Rodriguez, Texas
Stevan Pearce, New Mexico            Joe Baca, California
Devin Nunes, California              Nick J. Rahall II, West Virginia, 
Richard W. Pombo, California, ex         ex officio
    officio


                                 ------                                
                            C O N T E N T S

                              ----------                              
                                                                   Page

Hearing held on May 15, 2003.....................................     1

Statement of Members:
    Calvert, Hon. Ken, a Representative in Congress from the 
      State of California........................................     1
        Prepared statement of....................................     2
        Letter to Patrick Wright submitted for the record........    43
    Napolitano, Hon. Grace F., a Representative in Congress from 
      the State of California....................................     2
    Nunes, Hon. Devin, a Representative in Congress from the 
      State of California........................................     3
        Email submitted for the record...........................    41

Statement of Witnesses:
    Peltier, Jason, Special Assistant to Secretary for Water and 
      Science, U.S. Department of the Interior...................     5
        Prepared statement of....................................     6
    Wright, Patrick, Director, California Bay-Delta Authority....    23
        Prepared statement of....................................    25
        Response to Calvert letter submitted for the record......    45


             OVERSIGHT HEARING ON CALFED'S CROSS-CUT BUDGET

                              ----------                              


                         Thursday, May 15, 2003

                     U.S. House of Representatives

                    Subcommittee on Water and Power

                         Committee on Resources

                             Washington, DC

                              ----------                              

    The Subcommittee met, pursuant to notice, at 10:06 a.m., in 
room 1324, Longworth House Office Building, Hon. Ken Calvert 
[Chairman of the Subcommittee] presiding.
    Present: Representatives Calvert, Radanovich, Nunes, 
Napolitano, Dooley, and Inslee.

STATEMENT OF THE HON. KEN CALVERT, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF CALIFORNIA

    Mr. Calvert. The Subcommittee on Water and Power will come 
to order.
    The Subcommittee is meeting today to hear testimony on 
CALFED's Cross-cut Budget. Under Committee Rule 4(g), the 
Chairman and the Ranking Minority Member can make opening 
statements; if any other members have statements, they can be 
included in the hearing record under unanimous consent.
    I ask unanimous consent that all representatives who may 
come today have permission to sit on the dais and participate 
in the hearing if they do come. If there is no objection, so 
ordered.
    For nearly two decades, Californians and the Federal 
Government have grappled with a decreasing water supply in the 
face of drought, infrastructure limitations, and increasing 
environmental water demands. CALFED was conceived to help 
restore and resolve these growing conflicts and foster 
cooperation between the Federal Government, California, and 
other interests.
    Many envision CALFED as an innovative way to better 
coordinate Federal and State initiatives. Under this effort, 
Federal and State agencies would work together to ensure that 
taxpayer dollars were wisely spent to achieve CALFED 
objectives.
    However, many stakeholders believe that CALFED's Federal 
and State agencies are now carrying out policies in isolation 
and without the intended balance. Essentially, CALFED's 
decisionmaking and accountability have been questioned.
    For these reasons, Congress this year required the 
executive branch to deliver a CALFED cross-cut budget 
displaying past, current, and projected expenditures. This 
disclosure budget will help determine how Federal and State 
agencies are cooperating and coordinating their actions and 
identifying project priorities. It will give Congress and the 
public insight into how these decisions are made, whether 
benchmarks have been set, and how coordination can be improved.
    The cross-cut budget will provide Congress a first step in 
passing CALFED legislation which brings more accountability, 
streamlining, and focus to the program. Above all, a properly 
drafted cross-cut budget could serve as an accountable way of 
determining how our dollars are spent on other multi-agency 
Western water projects like in the Klamath Basin.
    Today we are honored to have two witnesses who have first-
hand knowledge of the CALFED Program, and we certainly thank 
both of you for accepting our invitation to be here today and 
look forward to your testimony.
    With that, I am more than pleased to recognize Mrs. 
Napolitano, the ranking Democratic member, for any statement 
she may have.
    [The prepared statement of Mr. Calvert follows:]

           Statement of The Honorable Ken Calvert, Chairman, 
                    Subcommittee on Water and Power

    For nearly two decades, Californians and the Federal Government 
have grappled with decreasing water supply in the face of drought, 
infrastructure limitations and increasing environmental water demands. 
CALFED was conceived to help resolve these growing conflicts and foster 
cooperation between the Federal Government, California and other 
interests.
    Many envisioned CALFED as an innovative way to better coordinate 
Federal and state initiatives. Under this effort, Federal and state 
agencies would work together to ensure that taxpayer dollars were 
wisely spent to achieve CALFED objectives.
    However, many stakeholders believe that CALFED's Federal and state 
agencies are now carrying out policies in isolation and without 
intended balance. Essentially, CALFED's decision making and 
accountability have been questioned.
    For these reasons, Congress this year required the Executive Branch 
to deliver a CALFED cross-cut budget displaying past, current and 
projected expenditures. This disclosure budget will help determine how 
Federal and state agencies are cooperating and coordinating their 
actions and identifying project priorities. It will give Congress and 
the public insight into how these decisions are made, whether 
benchmarks have been set and how coordination can be improved.
    The cross-cut budget will provide Congress a first step in passing 
CALFED legislation which brings more accountability, streamlining and 
focus to the Program. Above all, a properly drafted cross-cut budget 
could serve as an accountable way of determining how our dollars are 
spent on other multi-agency western water projects like that in the 
Klamath basin.
    Today, we are honored to have two witnesses who have first-hand 
knowledge of the CALFED Program. We thank you both for accepting our 
invitation to be here today and look forward to your testimony.
                                 ______
                                 

STATEMENT OF THE HON. GRACE F. NAPOLITANO, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mrs. Napolitano. Thank you, Mr. Chair. It is a pleasure 
working with you.
    I offer my most sincere appreciation for your convening 
this hearing and for insisting that our administration produce 
a CALFED cross-cut budget as is required by law.
    The budget document we received yesterday, and that I spent 
a few hours, up until past midnight, trying to decipher--not 
necessarily knowing what I was looking at--is complex and 
mysterious, and I certainly look forward to the testimony this 
morning and hope that it will clarify a little bit of the 
perplexity I had in my mind last night and that some of the 
questions that we may have will be addressed and answered.
    Much of the debate over the CALFED legislation centers on 
the implementation of the CALFED ROD, the Record of Decision. I 
was under the impression that the CALFED ROD was carefully 
worked out during the stakeholder process and that the ROD is 
the centerpiece of the program--more or less the guidebook for 
all agencies, all of our Federal agencies and State agencies--
that Congress and the public can look to as a point of 
reference as it moves forward.
    Apparently this Administration does not share the view 
stated in the testimony that they only support concepts in the 
ROD. Frankly, Mr. Chairman, that is kind of lukewarm support 
from the Administration and it is not good enough. The 
stakeholders, our agencies, Congress, have supported the Bay-
Delta Program for nearly 9 years, and the ROD is now nearly 3 
years old. If this program is to succeed in solving 
California's water programs and reducing water conflicts in our 
State, we have to move forward past the talking stage and get 
things done, under way, funded.
    It is not helpful to learn that our main partner in this 
effort has only conceptual support for the implementation of 
this program. Mr. Chairman, our communities in Southern 
California have been ready to go. We can produce the recycled 
water. We can build the de-salting plants we need to reduce our 
dependence on Northern California, the Bay-Delta, and the 
Colorado River. We can reduce enough to hopefully meet the 4.4 
by 2016.
    But this Administration needs to commit their help with 
these projects. They have instead made clear their intention to 
terminate the Title XVI Water Recycling Program, one of our 
most promising, useful, and popular Federal water programs in 
the history of our Nation. Is this Administration planning the 
same fate for CALFED, hoping the State of California will be 
there to take on more and more responsibility for funding the 
CALFED projects, or are they waiting for individuals to pass 
legislation to fund them?
    Mr. Chair, I believe we can still enact legislation to 
implement the CALFED ROD, and I hope we will have the 
enthusiastic support from the Administration that we have from 
this Committee.
    Thank you.
    Mr. Calvert. I thank the gentlelady.
    Are there any other opening statements?
    Mr. Nunes.

STATEMENT OF THE HON. DEVIN NUNES, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF CALIFORNIA

    Mr. Nunes. Thank you, Mr. Chairman, and thank you for your 
continued commitment to the CALFED process. I know how you 
really want to get a bill to the House floor this year, and I 
agree with you.
    However, I want to make sure that this Committee ensures 
that the State of California develops new yield instead of 
continuing down this process of no new storage for the State of 
California. In reviewing the budget yesterday, I was concerned 
in Category A and B funding, there is $27 million for storage 
and $269 million for ecosystem restoration. I am not against 
ecosystem restoration; however, ultimately, if we do not 
develop new water supplies in the State of California, we are 
going to continue to have these recurring issues, for example, 
the Colorado River issue.
    I am very interested today to hear Mr. Peltier and Mr. 
Wright comment on this process and where we are, especially in 
regard to new storage facilities.
    I want to thank you for coming and you, Mr. Chairman, for 
holding this hearing.
    Mr. Calvert. I thank the gentleman.
    Mr. Dooley, any opening statement?
    Mr. Dooley. No, Mr. Chairman.
    Mr. Calvert. I think it is appropriate that we have this 
meeting today, especially with the news in the last couple of 
days in regard to the quantification settlement agreement in 
California. As we all know, in California, all water is related 
even though we are here today to talk about CALFED. It is a 
very fragile agreement, and we may lose hundreds of thousands 
of acre-feet of water per year if we cannot close the loop on 
this deal, and that makes this process that much more 
important. And certainly, as Mrs. Napolitano has mentioned, 
Title XVI and reclamation projects and other water development 
projects in California are even more critical if in fact this 
does not come together--this so-called soft landing is not 
going to be so soft.
    So with that, we have our panel today--Mr. Jason Peltier, 
Special Assistant to the Assistant Secretary for Water and 
Science, U.S. Department of the Interior, and he is accompanied 
by the following Federal agencies to comment if necessary: Mr. 
Mark C. Charlton, Deputy District Engineer, Sacramento 
District, the United States Army Corps of Engineers; the 
honorable Mack Gray, Deputy Under Secretary for Conservation, 
U.S. Department of Agriculture; Mr. Tim Fontaine, Staff 
Director, Resource Management Staff, Environmental Protection 
Agency; and Mr. Jim Lecky, Assistant Regional Administrator for 
the Southwest Region for NOAA Fisheries, National Oceanic and 
Atmospheric Administration.
    And of course, our second witness is Mr. Patrick Wright, 
who is Director of the California Bay-Delta Authority, our man 
on the ground in California.
    With that, I will first recognize Mr. Peltier.

STATEMENTS OF JASON PELTIER, SPECIAL ASSISTANT TO THE ASSISTANT 
    SECRETARY FOR WATER AND SCIENCE, U.S. DEPARTMENT OF THE 
  INTERIOR, ACCOMPANIED BY MARK C. CHARLTON, DEPUTY DISTRICT 
 ENGINEER, SACRAMENTO DISTRICT, U.S. ARMY CORPS OF ENGINEERS; 
   MACK GRAY, DEPUTY UNDER SECRETARY FOR CONSERVATION, U.S. 
   DEPARTMENT OF AGRICULTURE; TIM FONTAINE, STAFF DIRECTOR, 
   RESOURCE MANAGEMENT STAFF, U.S. ENVIRONMENTAL PROTECTION 
   AGENCY, AND JIM LECKY, ASSISTANT REGIONAL ADMINISTRATOR, 
   SOUTHWEST REGION FOR NOAA FISHERIES, NATIONAL OCEANIC AND 
                   ATMOSPHERIC ADMINISTRATION

    Mr. Peltier. Thank you, Mr. Chairman and members of the 
Committee. It is a pleasure to be here with you and provide 
some insight on the work that has been going on recently in 
California and over at OMB to prepare a cross-cut budget.
    My testimony will focus on several things--one, how the 
cross-cut was developed; two, what the overall numbers look 
like for the last 4 years, and I will talk about planning and 
governance; and then I will close with the need that we see, 
that we share with you, for getting authorization legislation 
passed.
    OMB has prepared and provided to the Committee the cross-
cut budget information that you have had this week to review. 
The purposes of preparing the cross-cut are twofold--first, to 
compile a comprehensive list of Federal and State programs and 
projects that contribute to or complement CALFED program goals 
and objectives; second, to coordinate the implementation of all 
those programs. I think that you will see in these listings a 
very serious and in-depth commitment of the Administration and 
of the Federal Government to making CALFED work.
    I think the important difference that you are going to hear 
between what I say and what Patrick Wright is going to say in 
terms of characterizing the cross-cut has to do with the 
Category A and Category B discussion, and I think it is 
important up front to make sure that we are clear on what the 
distinction is.
    Category A programs are programs that are specifically 
identified in the ROD or totally aligned with the CALFED 
Program, if you will; and Category B are those related 
programs, other agency programs, that are ongoing, that the 
many Federal agencies have in place.
    When OMB initially provided a cross-cut to you last month, 
you asked that they go back and do some more work on it and 
provide a more expansive look at what all Federal activities 
are related to CALFED, and that has resulted in this cross-cut 
budget that you have in front of you which includes Categories 
A and B.
    I think it is important--one thing the process and the 
production of these documents revealed was the amount of money 
that we see going from the many agencies into the CALFED 
solution program and related programs, and I would like to 
highlight a few over the last 4 years, a few areas where the 
Federal investment has been quite substantial: In the Ecosystem 
Restoration Program, $249 million; in the Water Use Efficiency 
Program, $103 million; Drinking Water Quality, $35 million; 
Storage, $27 million; Science, $43 million; and Integrated 
Regional Water Management, $189 million. Those are just some of 
the highlight numbers of the overall program.
    I should note that the budget cross-cut data may be 
different than you have seen in prior summaries, and the 
differences can be attributed to two things. Projected budgets 
are being overcome by actual appropriations during reporting 
cycles, and reporting funding for Category B programs and 
projects that previously had not been included is here today so 
that the numbers are kind of a moving target. In fact, I would 
say the whole cross-cut is an evolving reporting mechanism. And 
I share with you, Mr. Chairman, your observations about the 
value of the cross-cut in terms of, for us as a management 
tool, for you as an oversight tool and as something for the 
public to see and understand what the program is all about.
    Let me end there on cross-cut and talk briefly about 
governance. California, as Patrick Wright will explain, has 
passed governance legislation establishing the authority in 
California. In the current process, Federal agencies continue 
to participate with their State counterparts; CALFED continues 
to run as before when the Authority was created. We are 
participating on a voluntary basis. We are not voting members 
of the Authority, but we are fully engaged in the planning and 
implementation processes as they proceed. If Congress passes 
legislation authorizing us to be members of the Authority, the 
relationship with them will evolve even further.
    In conclusion, I would just like to reiterate what 
Secretary Norton has said and Assistant Secretary Raley have 
said repeatedly, that we are anxious to see a bill passed, 
getting the CALFED Program authorized so we can move forward 
without the questions and limitations that we currently have 
relative to our authorities.
    Thank you.
    Mr. Calvert. I thank the gentleman.
    [The prepared statement of Mr. Peltier follows:]

  Statement of Jason Peltier, Special Assistant to the Secretary for 
           Water and Science, U.S. Department of the Interior

Introduction
    Chairman Calvert and members of the Subcommittee, I appreciate the 
opportunity to appear before you today to discuss the CALFED Bay-Delta 
Program's Budget Crosscut. My testimony will focus on the development 
and composition of the Fiscal Years 2001-2004 Federal Budget Crosscut, 
current Federal and State agency coordination, and concerns regarding 
future authorizing legislation. I look forward to working with this 
Committee and all our fellow CALFED agencies to achieve our goals.
    The Administration supports the CALFED program and the concepts 
embedded in the CALFED Bay-Delta Program Record of Decision (ROD), 
which set forth the activities to be undertaken under CALFED. In 
particular, we support the principle of balanced progress across all 
elements of the Program. We recognize there is a long history of 
conflict over many of the issues CALFED addresses. Without balanced, 
integrated progress, conflict and stalemate results and all 
stakeholders and resources suffer. By implementing a broad range of 
complementary programs in a balanced manner, CALFED can ensure that the 
interests of all agencies and stakeholders are recognized and 
addressed.
    The objectives of the CALFED Program are to: (1) provide good water 
quality for all beneficial uses; (2) improve and increase aquatic and 
terrestrial habitats and improve ecological functions in the Bay-Delta 
to support sustainable populations of diverse and valuable plant and 
animal species; (3) reduce the imbalance between Bay-Delta water 
supplies and current and projected beneficial uses dependent on the 
Bay-Delta system; and (4) reduce the risks that would result from 
catastrophic breaching of Delta levees.
    The CALFED Program holds significant promise for all who benefit 
from the use of the Bay-Delta and for restoration of the Bay-Delta's 
ecological health. However, our ability to move forward on a broad 
basis is limited until the Program is authorized. To that end, we share 
your desire to see legislation introduced that would provide Federal 
agencies with the necessary Program authorization to advance CALFED 
plan implementation efforts, while recognizing the fiscal realities of 
the State and Federal budgets.
Budget Crosscut
    The idea of a CALFED Budget Crosscut pre-dated the CALFED Bay-Delta 
Program ROD and was formally adopted by the participating Federal and 
State agencies and acknowledged in Attachment 3 to the Implementation 
Memorandum of Understanding (MOU) to the CALFED Bay-Delta Program ROD. 
The purposes of establishing the Budget Crosscut were to (1) identify a 
comprehensive list of programs and projects being implemented by 
Federal and State agencies in the defined geographic area that 
contributed to or complemented the CALFED goals and objectives; and (2) 
coordinate the implementation of those programs and projects both from 
a planning and financial aspect so as to maximize resource benefits and 
financial efficiencies.
    The geographic area as defined in the CALFED Programmatic EIR/EIS 
encompasses both the ``problem area,'' the Suisun Bay/Suisun Marsh and 
Delta, and the ``solution area,'' the Delta Region, Bay Region, 
Sacramento River Region, San Joaquin River Region, and other State 
Water Project (SWP) and Central Valley Project (CVP) Service Areas. A 
map of the CALFED Bay-Delta Program Programmatic EIR/EIS Study Area is 
attached for reference. In order to acknowledge other contributing 
Federal program and project funds, the solution area is further defined 
to include the counties served by the SWP and/or the CVP.
    The participating Federal and State agencies identified two groups 
of programs and projects, known as ``Category A'' and ``Category B'', 
that contribute to achieving the CALFED ROD objectives within the 
geographic solution area. Category A programs include those programs 
and/or projects that are consistent with the program goals, objectives, 
and priorities of the ROD and contribute benefits within the CALFED 
geographic solution area. These are recognized by the participating 
CALFED agencies as integrated into the planning and implementation of 
the CALFED Program and consistent with implementation principles and 
commitments set forth in the ROD. Category B includes those programs 
and/or projects and funds that have related and overlapping program 
objectives, whose geographic area overlaps with the CALFED geographic 
solution area. Category B programs and projects are coordinated by the 
agencies, but not necessarily integrated into the CALFED planning and 
funding process. Based on these guidelines, each agency delineates the 
programs that constitute their Category A and B activities. The initial 
list of CALFED Category A & B State and Federal Programs, attached to 
the ROD Implementation MOU, has been revised to include new programs 
and projects as appropriate and agreed upon by the agency with program 
and funding authority. Attached is a revised version of the initial 
list reflecting those programs and projects that Federal agencies agree 
should be reflected in the Budget Crosscut.
    Semi-annually, the participating CALFED agencies compile a Budget 
Crosscut that consists of both Federal and State funding for Category 
A&B programs and projects. My remarks today are limited to the Federal 
component of that budget. The budget information is grouped by CALFED 
Program elements--Ecosystem Restoration, Environmental Water Account, 
Water Use Efficiency, Water Transfers, Watershed, Drinking Water 
Quality, Levees, Storage, Conveyance, Science, Water Supply 
Reliability, and Oversight & Coordination--and identified by the 
authorized agency and/or appropriation. After enactment of fiscal year 
spending bills, the second version of the Budget Crosscut is compiled 
to reflect actual appropriations for the Category A & B programs and 
projects. The data by fiscal year is displayed in the CALFED Program's 
Annual Report and utilized in developing Program element planning/
priority documents.
Multi-Year Budget Crosscut
    Attached is the Federal Budget Crosscut which displays by fiscal 
year all CALFED Bay-Delta Program-related expenditures by the Federal 
Government, actual and projected, for Fiscal Year 2001 through 2004. 
Generally, the Fiscal Year 2001 and 2002 numbers represent agency 
obligated appropriations; the Fiscal Year 2003 funds are stipulated by 
agency as enacted or apportioned appropriations; and the Fiscal Year 
2004 numbers are part of the President's proposed budget. Funds are 
reported by fiscal year by the agency receiving the appropriation, and 
apportioned amounts are provided, where feasible, when the total 
program/project funding is attributable to efforts beyond CALFED 
objectives/geographic area. In some cases, agencies cannot currently 
predict their full Fiscal Year 2003 or Fiscal Year 2004 funding due to 
the fact that a portion of their funds are awarded through competitive 
processes and the amount to be applied in the CALFED solution area is 
currently unknown. The absence of these Fiscal Year 2003 and Fiscal 
Year 2004 amounts prevents a simple comparison of total funds to 
previous years.
    The budget data presented may not conform to prior submissions of 
similar information provided by the combined Federal agencies, or 
individual agencies or the California Bay-Delta Authority. The 
difference is attributable primarily to the Federal agencies reporting 
funding for Category B programs and projects that previously had not 
been included in publicized Budget Crosscuts. In order to reflect more 
accurately the true Federal investment, these programs and funds are 
incorporated in the multi-year Budget Crosscut developed by the Office 
of Management and Budget in consultation with the participating Federal 
agencies.
State and Federal Agency Program Coordination
    The level of collaboration and coordination achieved among the 
stakeholders and Federal and State agencies having interests in the 
Bay-Delta estuary, has been key to the success of the CALFED Program. 
The ``ClubFED'' side of the CALFED Program reflects a cooperative 
planning and coordination effort among ten Federal agencies, including, 
within the Department of the Interior, the U.S. Fish and Wildlife 
Service, U.S. Bureau of Reclamation, U.S. Geological Survey, and Bureau 
of Land Management, as well as the U.S. Environmental Protection 
Agency, National Marine Fisheries Service, U.S. Forest Service, Natural 
Resources Conservation Service, U.S. Army Corps of Engineers, and 
Western Area Power Administration.
    The enactment of California Senate Bill 1653 established a new 
state entity, the CALFED Bay-Delta Authority (Authority), in the 
Resources Agency with the general purpose of implementing the CALFED 
Bay-Delta Program. The Authority consists of 6 named state agencies, 6 
named Federal agencies (Department of the Interior, Fish and Wildlife 
Service, Bureau of Reclamation, Corps of Engineers, NOAA Fisheries, and 
the Environmental Protection Agency), 7 public members, a member from 
the Bay-Delta Public Advisory Committee (Federal advisory group), and 4 
non-voting members of the Legislature. The Governor of California, in 
consultation with Secretary Norton, is actively considering the 
appointment of the 5 public members representing regional aspects of 
the CALFED Program. These appointments are anticipated shortly.
    Federal participation in the Authority is voluntary and non-voting 
until acceptable Federal authorizing language is enacted. In the 
absence of Federal authorization, the ClubFED agencies have agreed upon 
the following interim interaction and coordination goals: (1) continue 
the cooperation between participating Federal and State agencies; (2) 
seek permanent oversight and coordination of the CALFED Program 
provided decision-making authority on budgets and project/program level 
efforts remains vested with individual agencies; and (3) continue to 
operate in accordance with the CALFED ROD Implementation MOU and the 
Management Group MOU until the Authority is operating.
    The existing CALFED ROD Implementation MOU was executed before the 
creation of the new State Authority. Accordingly, some of the 
provisions of the Implementation MOU are out of date. The ClubFED 
agencies have been working with their State counterparts to draft 
appropriate revisions to the Implementation MOU to reflect the role of 
the new Authority. A result of the coordination between implementing 
Federal and State agencies is the development of multi-year Program 
Plans that describe each Program element--goals, objectives, 
priorities, proposed budgets, and major tasks, products and schedules. 
Each Program Plan also includes an assessment of the previous year and 
integration efforts across Program elements. The Program Plans are used 
by the Federal and State agencies to manage program implementation over 
the ensuing year and guide agency budget requests. The Bay-Delta Public 
Advisory Committee and the Authority use the Program Plans to assess 
overall progress, funding needs, program balance, and to make 
recommendations to the implementing agencies. The Program Plans serve 
as a tool for the implementing agencies and others to ensure each 
Program element is meeting ROD objectives, has sufficient funding, and 
is coordinated with other Program elements.
Authorization Concerns
    Despite the progress that has been accomplished through existing 
agency authorizations, the Administration has some budgetary concerns 
you may consider in drafting authorizing legislation:
    Cross-Cut Appropriation. As previously noted, the Federal side of 
the CALFED Program is a cooperative planning and coordination effort 
among ten Federal agencies. In order to reduce inefficiencies and 
further improve agency participation and recognition, the Department of 
the Interior believes we should consider a broader allocation of 
appropriations among the participating implementing Federal agencies. 
This would be a departure from the centralized appropriations made to 
the Bureau of Reclamation under the 1996 Bay-Delta Act that funded 
Program planning and early ecosystem restoration activities. A cross-
cut appropriation would more accurately reflect the contributions of 
the participating Federal agencies and lessen the risk to other 
Reclamation funded programs and projects in the Western States.
    Long-Term Cost of the Program. We are concerned that the overall 
cost, including the current and future financial exposure of the United 
States to the programs and initiatives identified in the CALFED ROD, 
may not be sustainable. Legislation should authorize an integrated 
program that can reasonably be expected to be fully funded in the 
current fiscal climate. Failure to authorize affordable CALFED program 
components may jeopardize the progress of a balanced CALFED Program.
Conclusion
    The Bay-Delta is a region of critical importance to California. 
Through Federal, State, and public collaborative implementing efforts, 
progress has been made in improving water supply reliability and the 
ecological health of the Bay-Delta Estuary. The Federal contributions 
to these efforts are reflected in the attached Budget Crosscut table 
and program list. While the Administration is encouraged by the 
accomplishments to date under the CALFED Bay-Delta Program, your 
support of the Program through enactment of authorizing programmatic 
legislation and associated funding for the participating Federal 
agencies is fundamental to continuing Federal implementation efforts 
under the Bay-Delta Program.
    This concludes my testimony. Mr. Chairman, I would like to 
reiterate my appreciation to the Committee and others for continuing to 
work with the Administration to address the significant water issues 
facing California. I would be happy to answer any questions.
Attachments.
    1. CALFED Bay-Delta Program Programmatic EIR/EIS Study Area Map
    2. Revised List of CALFED Category A & B State and Federal 
Programs
    3. CALFED Bay-Delta Program Cross-Cut Federal Budget for Fiscal 
Years 2001-2004

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    [NOTE: The report entitled ``CALFED-Related Federal Funding Budget 
Crosscut'' has been retained in the Committee's official files.]
                                 ______
                                 
    Mr. Calvert. Next is Patrick Wright, Director, California 
Bay-Delta Authority.
    You are recognized for 5 minutes.

            STATEMENT OF PATRICK WRIGHT, DIRECTOR, 
                 CALIFORNIA BAY-DELTA AUTHORITY

    Mr. Wright. Thank you, Chairman Calvert and members of the 
Committee. I too appreciate the opportunity to be here today to 
talk a little bit about the process that we go through in the 
program.
    You have, I assume, copies of my written testimony, so I 
will briefly summarize some of the key points in terms of 
trying to get a better handle on State, Federal, and local 
investments in the program.
    As you may know, during the past 3 years, we have done this 
analysis annually, retrospectively, so if you have copies of 
our annual report, for example, you will see spreadsheets that 
lay out the State, Federal, and local investments for each 
element of the program.
    What is different and encouraging about this exercise is 
that for the first time, it is done prospectively so that you 
and other Members of Congress can get a better handle on the 
future projections of funding so you can make your own 
determinations on issues such as balance and the appropriate 
level of contributions from the various agencies that 
participate in the program.
    We have not had time back at the program to pour through 
every detail of the cross-cut, but there certainly are a few 
key issues that I want to highlight. First, as I just said, 
this information would be even more useful if it were 
incorporated into the annual budget process so it is not just a 
one-time exercise here where you get a sense of what the 
various Federal investments are but you see that as part of the 
President's budget request and throughout the process of 
spending that goes on here in the Congress.
    For example, if you picked up a copy of the President's 
budget in January, you would find a CALFED line item of $15 
million when in fact, as you are seeing today from the cross-
cut, the Federal contribution in 2004 is quite a bit higher 
than $15 million. So clearly more work needs to be done to sort 
out the confusion between the so-called CALFED appropriation, 
which is a part of the Bureau's contribution, and the entire 
contribution of the Federal agencies toward the goals of the 
program.
    Second, in taking a look at those numbers, it is clear that 
the Bureau remains the only agency that from a financial 
perspective is making a significant contribution to the 
program. Arguably, when we were in the planning phase of the 
program, that made some sense to funnel all the money through 
one agency to make sure you had the kind of accountability that 
you needed, that can happen with one agency handling the money, 
but now that we are in the implementation stage where other 
Federal agencies have lead responsibilities for the program, we 
think it is more appropriate to apportion the financial 
responsibility accordingly. So that is something that we are 
going to continue to push for with the various State and 
Federal agencies.
    Third, it has also become clear to us that, as we have seen 
the omnibus appropriations bill pass last year and other bills 
pass previous to that, the vast majority of actions in the 
program are already authorized. Most of what we do in the 
CALFED Program is to provide oversight and coordination of 
existing State and Federal programs to make sure they are 
balanced, to make sure we have adequate science, to make sure 
we have adequate public participation, to make sure the 
agencies are working together, et cetera.
    There are a couple of exceptions to that, which is why it 
is extremely important to us to have a Federal authorization 
bill, but even more important, it is important to cement the 
State-Federal relationship that is going to be necessary to 
make this program a success. The authorization bill is really 
going to determine whether or not this program is going to be a 
State program with limited Federal participation, limited 
Federal accountability, or truly a State-Federal partnership 
where you have the kind of leadership and accountability that 
you need from the Federal side of the program.
    I think we have proven--and we would be happy to come back 
and give you an overview of the track record of the program in 
the last 3 years. It is clear on the environmental side with 
the investments that we have been making that the fisheries of 
the Bay-Delta System for the first time in decades are showing 
positive improvements. We hope that trend will continue, but it 
is certainly encouraging that the ecosystem investments appear 
to be paying off.
    On the water infrastructure side, we are also making 
significant investments. The collaborative partnership that 
CALFED created has led to the passage of three consecutive 
water bonds through which now billions of dollars are flowing, 
not to the agencies but to State and local communities 
throughout the State to meet their most pressing water needs.
    With respect to storage, the CALFED Program has the biggest 
investment in storage in the State's history. It calls for up 
to 3 million acre-feet of new storage. And for the first time, 
we are on track. We hope to have draft EISs for each of the 
storage projects by the end of 2004. Before the CALFED Program 
was stated, there was no progress being made on any of those 
projects. So again, we know that folks are impatient in terms 
of trying to get those studies done, but they are moving 
forward--but the authorization bill is going to be essential to 
make sure that those studies and the Federal support continues.
    Then, finally, through the Environmental Water Account, 
which is another key element of the program, we have avoided 
now for 3 years in a row having annual crises over operations 
in the Delta. Exporters from the Delta have received now, 
again, 3 years in a row assurances that their water supplies 
are not going to be interrupted due to fishery constraints in 
the Delta.
    So again, the track record of the program is growing as it 
matures, but for that to continue, we are going to need to have 
both a strong Federal investment and a strong Federal 
partnership. And we certainly appreciate, Chairman Calvert, 
your leadership in trying to get us there through your bill, 
and we certainly pledge to continue working hard with you to 
make sure that effort is a success.
    Thank you.
    [The prepared statement of Mr. Wright follows:]

 Statement of Patrick Wright, Director, California Bay-Delta Authority

    Chairman Calvert, Ranking Member Napolitano, and members of the 
Subcommittee on Water and Power, thank you for the opportunity to 
appear before you this morning. My testimony will provide background on 
the Bay-Delta Program, the Cross-cut Budget, and Federal authorization 
for the Program.
    The Bay-Delta Program is an unprecedented effort to implement a 
long-term comprehensive plan that addresses ecological health and water 
supply reliability problems in the Bay-Delta. On August 28, 2000, the 
State and Federal CALFED agencies signed the Record of Decision (ROD), 
formally approving this long-term plan.
    The Bay-Delta Program is unique in its approach to solving water 
and ecosystem problems because it addresses four resource management 
issues concurrently and in a balanced fashion: water supply 
reliability, water quality, ecosystem restoration, and levee system 
integrity. Conflicts in the Bay-Delta system have broad effects 
statewide. The Bay-Delta system:
     Provides drinking water to 22 million people
     Supports a trillion dollar economy including a $27 
billion agricultural industry
     Protect farms and homes in the Delta
     Is the largest estuary on the west coast and is home to 
750 plant and animal species and supports 80% of the State's commercial 
salmon fisheries.
    In the Department of the Interior's recently released Water 2025: 
Preventing Crises and Conflict in the West, DOI includes a ranking of 
areas where existing water supplies are not adequate to meet demands 
for people, farms, and the environment, and where there are potential 
water supply crises by 2025.
     The California Bay-Delta was rated with a conflict 
potential of ``Highly Likely'', which was the highest rating in the 
report.
     The Bay-Delta Program, through implementation of the 
commitments in the ROD, is in fact addressing this potential crisis.
California Bay-Delta Authority Act of 2003
    The California Bay-Delta Authority (Authority), established by 
California legislation enacted in 2002 (California Bay-Delta Authority 
Act), provides a permanent governance structure for the collaborative 
State-Federal effort that began in 1994. The Authority is charged 
specifically with ensuring balanced implementation of the Program, 
providing accountability to the Legislature, Congress and the public, 
and ensuring the use of sound science across all Program areas.
    The Authority is composed of representatives from six State 
agencies and six Federal agencies, five public members from the 
Program's five regions, two at-large public members, a representative 
from the Bay-Delta Public Advisory Committee, and four ex officio 
members, namely the chairs and vice-chairs of the California Senate and 
Assembly water committees. Figure 1 (attached) provides more 
information regarding the governance structure for the Bay-Delta 
Program.
Cross-cut Budget
        The purpose of the Cross-cut Budget is to identify the level of 
        funding (State, Federal, Water User and Local) that is 
        available to meet the Bay-Delta Program objectives as stated in 
        the Record of Decision (ROD). This information is used to 
        determine additional funding needed to stay on schedule and in 
        balance.
    At the time of the ROD, existing programs and projects were 
reviewed to determine which were currently contributing to Bay-Delta 
objectives and therefore should be integrated into a CALFED process 
that included review by State and Federal agencies, science and 
technical panels, and the public. Those programs and projects were 
labeled ``Category A'' programs. Only Category A funding is included in 
the Bay-Delta Cross-cut Budget because only those programs and 
activities are consistent with the goals and commitments in the ROD.
    All other programs and projects (referred to as ``Category B'') are 
not reviewed and funding is not tracked. Agency coordination is 
encouraged to avoid conflicts or duplication of efforts. Category B 
programs include programs or projects that have related objectives, or 
whose geographic area overlaps with the Bay-Delta Program solution 
area. However, Category B programs do not necessarily meet the 
commitments in the ROD, so the Authority does not include those 
programs in the Cross-cut Budget.
    The Cross-cut Budget display is developed by the Authority staff in 
coordination with all State and Federal agencies. The funding amounts 
associated with Category A programs are requested from each of the 
agencies, and then packaged by the Authority staff for each fiscal year 
showing the total funding by agency, program element, and fund source. 
The Cross-cut Budget is finalized and distributed publicly only after 
all affected agencies have had the opportunity to provide comments and 
verify the accuracy of the numbers used in the display.
Cross-cut Budget Differences
    The Office of Management and Budget (OMB) Cross-cut Budget (May 
2003) includes Category B programs and funding. The numbers developed 
by OMB differ from those developed by the Authority staff due to the 
inclusion of these Category B programs--programs that are not 
integrated into the CALFED process or reviewed to determine if they are 
meeting the commitments of the ROD. Table 1 (attached) is a Bay-Delta 
Federal Cross-cut Budget for fiscal year 01-04 that includes funding 
only for Category A programs and projects. The Bay-Delta Program will 
continue to develop annual Cross-cut Budgets and coordinate with the 
Federal CALFED agencies to identify those programs and funds dedicated 
to the objectives of the Program.
    At the time of the Record of Decision in 2000, support for the Bay-
Delta Program was generally to be divided equally between the Federal, 
State, and Local /Water user interests. For a variety of reasons, 
Federal funding has been lacking in the first 3 years of the Program. 
With the renewed commitment to the Bay-Delta Program by the Department 
of Interior in the ``Water 2025 Report'', we hope that the Federal 
involvement will increase.
Federal Authorization
    The California Bay-Delta Program strongly supports authorizing 
legislation which would provide necessary Federal funding to 
successfully implement a balanced Program in the future. Table 2 
(attached) shows State, Federal, and Local & Water User funding 
contributions to date during Stage 1 for the Bay-Delta Program. Federal 
funding has accounted for 11% of the total funding to date for the 
Program. State funding has primarily been from bond funds, which are 
projected to run out in 3-4 years. Given the current fiscal climate in 
the State, it is uncertain whether taxpayers will continue to support 
the passage of bond initiatives to fund the Program. A balanced package 
of State, Federal, Local, and Water User contributions is crucial to 
maintain Program progress. Failure to authorize the Program may 
jeopardize the progress of a balanced Bay-Delta Program.
    We also support the idea of a ``Cross-Cut Appropriation'' for the 
Bay-Delta Program, which would allocate appropriations for projects and 
programs to all of the Federal agencies that would be implementing the 
Program, rather than appropriating all of the funding through the 
Bureau of Reclamation budget, as has been done in the past. We believe 
this approach would be more efficient and would further enhance agency 
participation in the Program.
Attachments
Figure 1 -- California Bay-Delta Program Governance Structure Diagram
Table 1 -- Federal Funding Cross-cut Budget Fiscal Year 2001 - 2004
Table 2 -- California Bay-Delta Program Cross-cut Budget Fiscal Year 
2001 - 2004
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    Mr. Calvert. I thank the gentleman.
    Years ago, when I first got into business, my father told 
me ``Follow the money,'' and when I got into politics, things 
really did not change all that much. And certainly dealing with 
programmatic funds on projects the size of this is not any 
different.
    I am looking right now up here at the Everglades cross-cut 
budget--and by the way, the cross-cut budget we have today 
versus the cross-cut budget we got out of OMB a couple months 
ago is obviously much improved, so I congratulate everyone on 
that part. But on the Everglades budget I am looking at right 
now, you can take a look at the way that those numbers are 
being put together, and the coordination of those funds is 
much, it seems to me, superior to the process that we are going 
through today.
    So I hope we can take a look at that as a goal and, with 
that, what steps does the Department of Interior and other 
coordinating agencies, including regulatory agencies--because 
certainly they are involved in this to a large degree--what do 
they do to coordinate Federal activities in improving 
operations at the Central Valley Project and the State Valley 
Project?
    I guess first, Jason, I will put that to you.
    Mr. Peltier. CALFED is more than a planning process, and it 
is more than--you are familiar with all of the aspects of the 
CALFED Program, except there is another part that we do not 
talk about very often, and that is the operational side of the 
projects and the coordination among the agencies. That is, I 
think, another success story that we can talk about, and the 
CALFED Operations Committee and its various Subcommittees bring 
together the regulatory and operational agencies on a weekly 
basis, more frequently if there is something unanticipated 
occurring in the system relative to where the fish are showing 
up, for instance.
    So I would say that the coordination and collaboration 
among the agencies has been a great success, and on the 
operational front, the understanding and the learning that has 
occurred over the last few years through these collaborative 
efforts has been of mutual benefit to the operators and the 
regulating agencies. I think that is on the operations side 
where the most focus is.
    Mr. Calvert. Patrick?
    Mr. Wright. I would agree with that. I think we need to 
separate today the issue of a financial contribution from the 
Federal agencies and the lack of an authorization bill to 
cement the institutional structure from the very active 
engagement of the Federal agencies on the ground, particularly 
from Interior. As Jason said, we have all the agencies at the 
table working hard to integrate the various missions and 
mandates that they deal with. The issue here is less one of 
having the regional folks engaged than it is having the folks 
back here more engaged, both from a financial perspective and 
from an institutional perspective.
    Mr. Calvert. In the cross-cut budget, you have identified 
authorized projects such as several water recycling projects in 
Southern California as overlapping with the CALFED Program 
objectives. Could you explain those activities, how they have 
been coordinated with other agencies when it comes to 
protecting the Bay-Delta and improving the operations of the 
Central Valley Project? How are all these coordinated?
    Mr. Peltier. All of the programs that are identified in the 
Category A/Category B list--well, that is a pretty big 
question, because you can see that the breadth of programs is 
tremendous given the various missions of the agencies. One 
thing that the cross-cut, as we discussed earlier, shows us is 
that it kind of reminds us and educates other agencies as to 
the activities of their fellow agencies, so we can very quickly 
identify overlap and the interactions.
    Some of the programs operate very closely together--for 
example, fish screens. There is a fish-screening program in the 
CVPIA. CALFED has invested in fish screens, and CAL Fish and 
Game has. So those three different programs have over time 
evolved under the umbrella of CALFED to be very, very closely 
coordinated, and we have the professionals learning from other 
programs and making sure that the investments are the most 
needed and the most effective.
    There are a number of other overlap activities. In the 
storage area, the Storage Program has work teams that are 
working on each of the various facilities, and there is a 
differing combination of agency participation in each of those 
depending on who is in the lead, I would say--but once again, 
there is a common goal and a common work effort under the 
CALFED umbrella that is essential to accomplishing not only the 
purposes or the objectives of CALFED, but to making sure the 
money spent on both the Federal and State sides is maximized.
    Mr. Calvert. Mr. Wright, any comment?
    Mr. Wright. Just briefly, let me add to that. We do have a 
process biweekly where all the State and Federal agencies meet 
literally around the table to make sure all the various 
elements of the plan are moving forward and to make sure those 
actions are coordinated.
    It is a huge program, so we not only rely on those 
meetings, but a lot of spinoff meetings, a lot of meetings of 
our advisory councils and their Subcommittees, to make sure 
that we have the kind of coordination we need.
    Recycling is a good example, where the State launched a 
year-and-a-half process under which it established a recycling 
task force. The CALFED Program was an active part of that 
process to make sure the agencies were coordinated, to make 
sure we set up a new funding process to make sure that only the 
best projects were funded and also to make sure that money gets 
out the door as quickly as possible, because for some of our 
agencies, that has been a huge problem for local communities.
    So through are a variety of different forums, we have 
managed to ensure that the agency actions are coordinated and 
integrated.
    Mr. Calvert. Mrs. Napolitano?
    Mrs. Napolitano. Thank you, Mr. Chairman.
    No disrespect, Mr. Peltier, but are you one of the ranking 
members of your agency?
    Mr. Peltier. I have rank.
    [Laughter.]
    Mrs. Napolitano. No--one of the top-ranking members of your 
agency.
    Mr. Peltier. I do not know how to characterize my position. 
I am Special Assistant to the Assistant Secretary for Water and 
Science.
    Mrs. Napolitano. What happened to the Secretary--or the 
Assistant Secretary?
    Mr. Peltier. I was designated to represent the Secretary 
here today.
    Mrs. Napolitano. OK. I just wondered for the record, 
because I think that this Committee does rank--and I am sure 
they would defer to you for answering the questions, because 
you did the work--but it would behoove them to understand that 
this Committee is very interested in seeing their participation 
in this hearing.
    Mr. Peltier. I will convey that.
    Mrs. Napolitano. Thank you very much.
    The question that I would have--and Mr. Wright brought some 
of that up--is that the funding is funneled through the Bureau 
of Reclamation and has been, or at least a major portion of it 
is. Has there been any discussion through the agencies 
themselves to get direct funding from the agencies for the 
projects to move them forward at maybe an even faster, more 
expedient, more direct, and with less money going out for admin 
fees?
    Mr. Peltier. Yes. This is a topic of active discussion, and 
I think the cross-cut that we have provided or that OMB has 
provided shows you that there is considerable direct investment 
by agencies on CALFED-related activities and programs. And I do 
not want to mischaracterize the nature of Category B 
investments and say that that is CALFED. I want to be clear and 
say that that is related to CALFED. But you can see a broad 
swath of programs and investments that are being made directly 
by the participating agencies, and I think on into the future, 
both versions--well, let me say each version--of legislative 
proposals we saw last year included a requirement for a cross-
cut budget, and there was considerable focus on this notion of 
individual agency funding, and we look forward to continuing 
that discussion.
    Mrs. Napolitano. Is there anything we can do to be able to 
provide a more expedient determination of that?
    Mr. Peltier. No. I think the efficiency with which the 
agencies operate is very impressive, in part probably because 
most agencies--I know it is certainly true of Reclamation--it 
is the people in the field, it is the program managers, who are 
responsible for formulating and implementing the program who 
have been given the authority to move briskly, and they do. And 
I think the discussion that Patrick provided about the 
coordination and the weekly meetings ensures that those things 
happen quickly.
    Mrs. Napolitano. Can you tell me what the administration 
fees are for the Bureau on those agencies?
    Mr. Peltier. No--as in overhead or--
    Mrs. Napolitano. There is a cost there. There usually is. 
If money is passing through any agency for somebody else, there 
is usually a handling fee, if you will. It is called admin--
administration--you know that.
    Mr. Peltier. Yes. I think it is--let me ask--zero.
    Mrs. Napolitano. Impressive.
    Mr. Peltier. Obviously, Reclamation spends staff and other 
resources to administer the program, but in terms of 
passthrough, the Regional Director informs me that there is no 
cut taken.
    Mrs. Napolitano. Very good. I guess that was one of the 
most burning questions in the back of my mind.
    Is there any additional information that you would like to 
share?
    Mr. Peltier. No. I guess I would just like to highlight the 
fact that Patrick made and expand on it, that when we talk 
about CALFED money that Congress appropriations, we generally 
talk about the President's proposal for $15 million last year, 
or the $20 million that was appropriated. And I think the 
impressive result of this cross-cut budget exercise is that 
when you look at the totality of Federal engagement on CALFED 
and CALFED-related programs throughout California, we are 
looking at about a $700 million investment over the last 4 
years. That is quite impressive and I think amply demonstrates 
the work of the agencies and the broad sweep of their program 
commitment.
    Mrs. Napolitano. And I can also talk to that in the fact 
that California has also made that commitment and has passed 
several water bonds in the last 8 years that have really 
substantiated their support and their commitment.
    Mr. Peltier. Yes.
    Mrs. Napolitano. I am out of time, Mr. Chair. I would be 
glad to defer to the next person.
    Mr. Calvert. Before I move to the next questioner, in Mr. 
Peltier's defense, I know that he is a very knowledgeable guy 
about California water, and I am sure he is going to do a great 
job for us today.
    Mr. Nunes, you were the first one here, so you will be the 
first one recognized.
    Mr. Nunes. Thank you, Mr. Chairman. This is the first time 
I get to go ahead of Mr. Radanovich, so that is quite an 
honor--and Mr. Dooley, even; that is really an honor.
    Mr. Peltier, thank you for coming, and thank you for your 
service. I know that you are knowledgeable on California water 
issues, and I want to thank you again for being here today.
    I have really some questions that I need to have answered 
by yourself and Mr. Wright that I am concerned about and that I 
think you are also concerned about. I think I will start out by 
asking you if there is any area in this cross-cut budget that 
allows you or anyone else to directly or indirectly affect 
congressional action.
    Mr. Peltier. I am sorry--affect congressional action?
    Mr. Nunes. Yes.
    Mr. Peltier. Well, I think this cross-cut is a reflection 
of congressional action. It is a reflection of the exercise of 
the authorities that we have been given by Congress in the 
appropriation--
    Mr. Nunes. I guess I will make it a little bit easier. Does 
it allow you to participate in or with political organizations 
to lobby on behalf of or for the administration or against the 
administration?
    Mr. Peltier. No, absolutely not. We do not lobby. I mean, 
we will be champions of the programs that Congress has 
authorized, and we will try to make sure everybody is aware of 
what it is we are doing and why we are doing it, but in terms 
of ``political,'' quote-unquote, advocacy, that is not part of 
our world.
    Mr. Nunes. Mr. Wright, do you see that to be the same case 
as Mr. Peltier sees it?
    Mr. Wright. We are in a slightly different position, 
particularly in this period of uncertainty before the Federal 
side--the bill has been authorized. The way the program views 
its job is that until the new authority bill passed, we had 
basically a State lead and a Federal lead. Now we have a new 
board where, in addition to having the State agencies on it and 
the Federal agencies on it, we now have public members.
    Our job at the program--the reason why I was hired--was to 
assure implementation of the ROD and everything that comes with 
that--to make sure it is balanced, to make sure we have good 
science, to make sure we have adequate public participation, to 
make sure we meet the schedules and commitments to the extent 
we can given our limited budgets--rather than necessarily being 
advocates for either the State side, the Federal side, or any 
of the stakeholders. We are supposed to be an independent voice 
for trying to move this program forward, to put pressure on 
both the State and Federal side to meet the commitments that 
are in the plan.
    So from a congressional perspective, we are often asked by 
Members of Congress is this particular bill or this particular 
program consistent with the ROD, and we try to answer that. 
That is different from lobbying on behalf of individual 
projects.
    Mr. Nunes. Is there money in this budget that allows you to 
give advice to political organizations?
    Mr. Wright. Oh, I see what you are getting at. No, we do 
not spend--in fact, I should clarify too that, again, most of 
the money is going to the Bureau. There is a small amount of 
money that is going to support the program, but it is mainly to 
support Bureau people who participate in the program who are 
bound as part of the Administration from restrictions on 
lobbying, et cetera.
    Mr. Nunes. So you are not supposed to instruct political 
organization on how to lobby the Congress?
    Mr. Wright. Oh, absolutely not.
    Mr. Nunes. OK.
    Mr. Peltier. And if I could add, there is a Federally 
chartered advisory committee, the Bay-Delta Public Advisory 
Committee, which is made up largely of stakeholders and 
involved publics from around the State.
    In meetings of the Bay-Delta Public Advisory Committee, we 
make sure everybody is aware of the rules, that they are free 
to go exercise their--to petition government--but not as 
members of the advisory committee. They do have to do that in 
their status as a citizen.
    Mr. Nunes. OK. I want to get to another question, and that 
is, Mr. Wright, you indicate that in this Record of Decision, 
we want to create 3 million acre-feet of new storage.
    Mr. Wright. From surface storage. In addition to that, it 
calls for another million acre-feet-plus from groundwater 
storage.
    Mr. Nunes. So wouldn't you say that to do that, we would 
have to at some point build new surface storage projects?
    Mr. Wright. Yes. The plan envisions--and we are 
aggressively moving forward on the feasibility studies--to move 
toward construction of those projects that meet the various 
tests in the plan.
    Mr. Nunes. So you are not opposed to new storage projects?
    Mr. Wright. No. Again, my job is to implement the plan. The 
plan calls for significant investment in storage.
    Mr. Nunes. Would you ever advise people on how to kill 
legislation that the Congress would act upon to create new 
water storage projects?
    Mr. Wright. No. Again, my advice would be limited to 
comments on or feedback on provisions of bills as to their 
consistency with the CALFED Plan, which I said before certainly 
promotes storage across the board.
    Mr. Nunes. Thank you.
    Mr. Calvert. Mr. Dooley?
    Mr. Dooley. Thank you, Mr. Calvert.
    Mr. Peltier, I appreciate the information that was provided 
by you as well as by OMB, but I guess I am backing up and 
saying if our real objective here is trying to get a clear 
depiction about the investments which are contributing to 
achieving the goals of the ROD, I think there is a lot more 
work to be done. One of my concerns is that when I look at some 
of the information that was sent up, especially that dealing 
with Category B, it appears that we just send up the Army Corps 
of Engineers' budget for almost every project in the general 
service area of the CVP, even some not in the service area, 
because we have a lot of projects in there--one is the Turtle 
Bay Museum, and there are a number of other projects there--
that are basically being considered as Category B projects.
    Is that what your intent is, and can you justify that those 
projects clearly as consistent--as well as USDA; you have some 
USDA funding that has also been sent up as being Category B 
that is dealing with EQIP funding, and a lot of that is dealing 
with on-farm site improvements. And if we really are trying to 
paint the most accurate picture, which Mr. Calvert indicated 
that would be more consistent with what we are doing on the 
Everglades, is this the same way that that was handled down 
there? I would just appreciate your comments.
    Mr. Peltier. I cannot speak to the Everglades budget 
formulation; I am not familiar with that. But I certainly 
recognize what you recognize in terms of the breadth and scope, 
and there is a real tension in making the judgment calls that 
agency personnel do in terms of whether something is to be 
included or not.
    We do not want to overstate or pad or throw a bunch of 
things in that are not related, but that can be a hard call. 
Certainly the operation of the Central Valley Project is 
directly related to CALFED. We do not, of course, include, 
however, the O and M budget, the $80 million-plus that we spend 
every year operating and maintaining the CVP, as a CALFED 
investment.
    In the Corps' program, if you have some specifics, we can 
ask the Corps representative to come forward and explain Turtle 
Bay, for instance, if you would like that. I cannot speak 
specifically to Turtle Bay.
    Mr. Dooley. I guess my general observation is that the goal 
here, again, is trying to identify the Federal investments that 
we are making that are contributing to the goals that are 
embodied in the ROD. There is a line item here for the Pine 
Flat Turbine Bypass, which is a great project; it serves part 
of my district. But this is a private project. This is not a 
CVP, it is not a State project. And I guess I do not quite 
understand why we are considering even expenditures like that 
as being a contribution to the CALFED. And I think there are a 
whole lot of them in here when I look at the Army Corps' 
budget. And I know that everybody is under time constraints, 
but again--and it looks to me like OMB just submitted a whole 
lot of the Army Corps projects, and even in the USDA. The 
Turtle Bay Museum was just one that jumped out at me, but there 
are a number of others.
    Rather than get into a debate right now in terms of the 
individual projects, I just think there needs to be more work 
done in terms of really trying to focus on what are those 
projects that are contributing, because I think we are not 
getting a really good picture here.
    Mr. Peltier. If I could first say--and I do not want to 
debate, and I do not want to lose today--but what makes this 
tough is that the goals of CALFED are expansive, they are very 
broad, and the geographic solution area is very broad. That is 
what leads us to the point we have arrived at.
    Mr. Dooley. I guess my last question is I am really trying 
to get a little clearer picture in terms of what would be the 
impact on the Administration's request or inclusion in the next 
budget they would present to Congress for CALFED without a 
reauthorization by Congress versus a reauthorization? What 
would be your expectation in terms of the impact on the request 
that the President would be making in his budget that he would 
be sending up?
    Mr. Peltier. That is like a set-up, right?
    [Laughter.]
    Mr. Peltier. I would not want to speculate on that. I think 
what we have seen in the last 2 years is what would be 
considered by CALFED standards and the scope of the program a 
modest proposal in the President's budget, relying on existing 
authorities. And unless those authorities change, I would 
assume that we would continue moving ahead as we have been.
    Mr. Dooley. Thank you, Mr. Chairman.
    Mr. Calvert. I thank the gentleman.
    Mr. Radanovich. Thank you, Mr. Chairman.
    Mr. Wright, welcome to the Subcommittee. I appreciate your 
testimony.
    I do have a question. According to your testimony, about 
$787 million, Federal money, $68 million of which has been 
spend on CALFED to date, up to 2003. How much of the funding 
was dedicated to water storage projects that increased the 
State's water yield? Can you give me--the information is very 
good, but it would be nice to see on something like this a 
summary page that shows all the money from all various agencies 
throughout all 3 or 4 years.
    Mr. Wright. Sure; we could provide that. I am flipping 
through our annual report here, which does have Year 1, 2, and 
projected 3 broken down into various categories including 
storage.
    Mr. Radanovich. Actually, what I am looking for is an idea 
of--of that 787, can you give me an estimate of how much has 
been dedicated toward water storage projects?
    Mr. Wright. I do not know if these are apples and oranges 
or not, but what I am looking at here is in the first year, 
roughly $100 million, the second year, roughly $125 million, 
the third year, roughly $100 million for storage projects. 
Again, those are mainly for planning and feasibility studies, 
of course, which are going to be necessary. Once we get to the 
construction phase, obviously, those numbers will have to rise 
considerably if there is support for construction of one or 
more of those projects.
    Mr. Radanovich. So, of the $787 million that has been spent 
on CALFED so far, about half of that has been spent on water 
storage projects?
    Mr. Wright. No. Again, I am not sure where your 700--let 
me--
    Mr. Radanovich. That was in your testimony.
    Mr. Wright. Let me make sure we have the same--
    Mr. Radanovich. It is the Fiscal Year 2003 total budget 
number.
    Mr. Wright. Seven hundred eighty-seven. That is the Stage 
1, State, Federal, local, the 787, so that is Fiscal Year 2003, 
so that is Year 3. In Year 3, again, my figure--and these may 
be updated, because these were projections at the time they 
were written--is $108 million out of that $787 million was for 
storage.
    Mr. Radanovich. The original intent of CALFED was to bring 
everybody whole together. My concern over CALFED was the 
emphasis on environmental restoration. And again, I do not 
disagree on a lot of the environmental restoration projects, 
but the problem I have with CALFED is that that has gone along 
and been far more concentrated on than have water storage 
projects, and the idea that AGURB and environmental needs would 
all be brought forward together, and no group would be out 
front any more than the other one was, to try to bring 
everybody together as a group--if you look at the numbers, that 
has not happened.
    Can you give me an idea of how to make sure that that does 
happen? Is there a set of criteria in place to achieve balance 
in the implementation of this thing from here on out, because 
it seems to me that the proportion of spending on water storage 
should now be about 95 percent, with 5 percent to the other 
concerns. How do we balance things out?
    Mr. Wright. Yes, of course, it depends on how you look at 
the books. If you look at it from a water management 
perspective, if you add storage together with water recycling 
and conservation and groundwater, et cetera, we found that 
actually, we are spending twice as much on water management as 
we are on ecosystem restoration--but again, that is a dollar-
for-dollar situation. We are concerned with making sure we have 
balanced funding. It is obviously challenging to have as much 
money for surface storage given that we are just planning the 
projects versus implementation of our other programs, so until 
we get--
    Mr. Radanovich. But you would have to admit, though, that 
since 1995, the emphasis has not been on planning new water 
storage projects--the emphasis has been on ecosystem 
restoration.
    Mr. Wright. Well, given that we are moving as rapidly as 
possible on the storage projects, I do not know that it is fair 
to say that is not where the emphasis is--
    Mr. Radanovich. But you were not working as rapidly as 
possible in 1995, and you were working as rapidly as possible 
on ecosystem restoration.
    Mr. Peltier. I would add that, yes, I think that is an 
accurate statement, and it was largely because, at least from 
the Federal perspective, we had the Central Valley Project 
Improvement Act in place and a $40 million-a-year revenue 
stream for ecosystem work. We then had the Bay-Delta Ecosystem 
Act passed in the appropriations project and then subsequently 
funded to the tune of a couple of hundred million dollars.
    So, yes, that is an accurate representation and 
perspective, but I would share also with Patrick that the 
challenge, when you look at what has been spent to date, it is 
clearly unbalanced because of those--and also because the bonds 
had a heavy focus on ecosystem improvement.
    Mr. Radanovich. Well, then, what happened to the concept of 
everybody being brought forward together on this thing? Is that 
going to remain--
    Mr. Peltier. The concept remains--
    Mr. Radanovich. Are there criteria set in place to make 
sure that that balance comes back now?
    Mr. Peltier. The ROD calls for and our practice calls for 
the Secretary of Resources and the Secretary of Interior making 
a finding--that, as they develop their work plans, that they 
make a finding that the program is balanced, and that does 
occur. I participated last summer in the working group that 
spent a day going through the work plans out in California, and 
everything is not balanced in a year.
    Mr. Radanovich. No, Jason, it has been 8 years.
    Mr. Peltier. I know, but in terms of this year's program, 
you cannot say that everything has the same amount of money and 
the same amount of progress is being made on every one.
    Mr. Radanovich. Why was the commitment made to bring 
everybody forward together, then, when in fact it has not been 
the case?
    Mr. Peltier. It is over time that we will see--we cannot 
make the kind of investment in surface water storage 
construction today, because we have not done the necessary 
work, so you are not going to see that--we cannot have 
simultaneous improvement on all fronts, but everything is 
progressing, I would say.
    Mr. Wright. I think the criterion that we use is are all 
elements of the program moving forward together. Clearly with 
respect to storage, from a financial perspective, the 
contribution now that we are in the planning stage simply 
cannot be as high as it is for programs that are in the 
implementation stage.
    Mr. Radanovich. But you did not have the emphasis on 
storage until the last 2 or 3 years. This has been an 8-year 
project.
    Mr. Wright. No. The ROD was established 3 years ago.
    Mr. Radanovich. Yes, but the process started in 1995 when 
funding was--funding began in 1995. We got the authorization, 
and the funding began during that time. That was $150 million 
in 1996, roughly $150 million the following year, and 
disproportionately gone to ecosystem restoration, where the 
studies on the water storage projects did not really start 
until the last year or two.
    Mr. Peltier. Well, in fact we did not have until the 2003 
omnibus bill was passed authority to conduct feasibility 
studies--except for Shasta--for any of the storage identified 
in the CALFED--
    Mr. Radanovich. That is because it was not in the 
appropriations. Where was the authority not given--or, if the 
authority was necessary, when would it have happened in order 
for you to begin to study these projects? Who is responsible 
for it? Has it been the Congress, or has it been the CALFED 
Program itself?
    Mr. Peltier. My sense is that it has been part of the 
larger discussion of what is needed in terms of legislation. 
And one thing that we continually pointed out as people were 
having discussions about authorization of the CALFED Program, 
authorization legislation, was that we were very limited in 
reclamation in terms of the amount of work we could do on 
storage--except in the case of Shasta--in all other cases, we 
were limited to pre-feasibility work; we could not cross the 
line into feasibility-level work until we were so authorized, 
and we were with passage of the 2003 omnibus bill.
    Mr. Radanovich. Mr. Chairman, I see my time has run out.
    Mr. Calvert. You will get another shot at it.
    Before I move on to Mrs. Napolitano--because I think the 
question here is--and obviously, there is a level of 
frustration that you are feeling not only here on the dais but 
back home--we have spent a considerable amount of time and 
resources to plan and do the feasibility studies. When are we 
actually going to get some of the storage projects under 
construction? We want to go to the groundbreaking ceremony, so 
we put our schedules ahead pretty good. When can we expect to 
put that on our schedule? Does anybody here have any 
predictions?
    Mr. Wright. Let me take a shot at it. I think for the 
projects that have somewhat of a head start, from what I 
understand, for Sites Reservoir, for Shasta, for Los Vaqueros--
In-Delta is still undergoing science review right now--my 
understanding is that we will have draft EISs by the end of 
2004 assuming we continue to get the kinds of Federal 
investments we need to keep those projects going. Some of those 
represent delays from what was originally envisioned in the 
plan in part because of the lack of Federal funding. The San 
Joaquin project is a little behind that but not too far behind, 
because significant investments have been made there as well.
    Mr. Calvert. Let me ask this question. With the completion 
of the EIS, are the concurrent actual design/build plans being 
done on these projects? Are we going to have to go into design 
after the completion of the EIS? I am talking about actual 
construction drawings.
    Mr. Peltier. My understanding of the process is that once 
we get through the feasibility process and we find the project 
feasible, Congress needs to then authorize construction, and a 
part of that is getting to the detailed design. We need 
feasibility to do construction design.
    Mr. Calvert. I want everybody to understand. So the working 
drawings have not begun, and the working drawings themselves 
cannot begin, through the process we are going through--
feasibility, the EIS--until those are completed under the rules 
that we operate under. And how long typically does it take to 
do a design for an actual construction project of that 
magnitude, just approximately?
    Mr. Peltier. Well, if you look at the case of the two most 
recent reservoirs built in California--they were built by local 
water agencies--it was a matter of a few years if you look at 
East Side Reservoir.
    Mr. Calvert. So you would say a minimum of 2 years to do a 
design, actual working design drawings, to start the project?
    Mr. Peltier. Rather than guessing, why don't we get back to 
you with a more--
    Mr. Calvert. But I am just trying to get for the record 
today--I want everyone here to understand that if the EIS is 
not going to be completed until 2004, there is probably not 
much of an opportunity to get any of this under construction 
until at least 2006, based upon where we are today. That is 
what I am hearing. And from a background in construction, I 
know that on a job that size, it is going to take a couple 
years to do the drawings.
    Mr. Peltier. Probably 3 to 4 years to do design, yes, so 
you are correct. We can provide to the Committee and its 
members--the Bureau of Reclamation and Department of Water 
Resources regularly prepare a status report on the storage 
project activities that are going on, and we will provide that 
to you on a regular basis.
    Mr. Calvert. And for the record, later we could maybe get a 
more precise approximate schedule of when some of these 
projects can be under construction.
    Mr. Peltier. I think that would be valuable for all of us.
    Mr. Calvert. Mrs. Napolitano?
    Mrs. Napolitano. Thank you, Mr. Chair.
    First of all, I would like to ask unanimous consent for any 
member to submit questions for the record and request reply for 
same from the Administration, Mr. Chair.
    Mr. Calvert. Without objection.
    Mrs. Napolitano. The second thing is--and Mr. Peltier, I do 
not want to pick on you--but in the second paragraph of your 
testimony, the first sentence reads, ``The administration 
supports the CALFED Program and the concepts embedded in the 
CALFED Bay-Delta Program Record of Decision.''
    Are they not one and the same?
    Mr. Peltier. I would say that that is a very consistent 
statement of our view of the CALFED Program and the ROD that we 
have been articulating for the last 18 months.
    I can understand your thinking that there is something 
shifty about using those words, but the fact is the ROD is a 
programmatic document which has a huge, huge number of possible 
programs and activities; some are conceptual, some are 
operational today. So there is a wide variety of things 
contained within the ROD, and we do not want to find ourselves 
in a position of saying that we support every, single thing in 
that ROD, because there are ideas in the ROD, and what those 
ideas evolve into may or may not reflect the idea that they 
originally started out with.
    I guess that is the best I can do in terms of an 
explanation. The ROD is a very sweeping document.
    Mrs. Napolitano. Well, then, the question that comes to 
mind is can the Administration assure us that there is nothing 
in this cross-cut budget that falls outside the ROD--and that 
is kind of in the same vein that my colleague was questioning 
on, that it is not consistent with the ROD.
    Mr. Peltier. I am aware of nothing in the cross-cut 
Category A or B that is inconsistent with the ROD. As I said 
earlier, I think it is clearly a judgment call when you get 
into Category B, of how well does a program line up with the 
very broad goals and objectives of the CALFED Program. So there 
is judgment, and there can be debate. I think that our goal, 
our objective here today, is to recognize that there can be 
debate, but also our goal is to say there is a big body of work 
associated with the goals of CALFED that is going on here, and 
we ought to recognize and appreciate it.
    Mrs. Napolitano. I thoroughly support the concept, the 
whole idea that we need to be sure that California's water 
system is assured. We in Southern California rely on a lot of 
that water being transferred down to Southern California, and 
my main concern in Southern California is are we going to have 
water reliability.
    First, we have MOAB in Utah, that may cause problems in 
that third of the water delivery because of the contamination 
of the Colorado. Now we are talking about pollutants in their 
water. We have tremendous problems with our contamination in 
wells, in our own well water supply. So you understand the 
frustration for us as being able to assure that we in Southern 
California, who have the major part of the people drinking the 
water, have a reliable water source.
    So that is partly what I am concerned with, and there are a 
couple of questions that I am going to be asking further. But 
in this cross-cut budget that you have submitted, were all the 
Federal agencies consulted in preparing this budget?
    Mr. Peltier. Yes, to the best of my knowledge. The ClubFED 
group--the name we apply to the grouping of Federal agencies on 
the ground in Sacramento, or in California, that are engaged 
with CALFED--was passed directly by OMB to provide the 
initial--
    Mrs. Napolitano. OK, so the information came directly from 
the different agencies.
    Mr. Peltier. Yes.
    Mrs. Napolitano. And what was the Department of Interior's 
role as the lead CALFED agency in this process?
    Mr. Peltier. To organize meetings, to take the initial cut 
at the--what had been missing in prior efforts to develop a 
budget cross-cut was uniform guidance, if you will, on what 
should be in and out of Category A and Category B. Reclamation, 
to get the discussion rolling, took the first cut at a 
description of that so folks would have the same basic guidance 
in terms of making their decisions about what is in Category A 
or Category B. Reclamation also organized the meetings, 
followed up with the various agencies and assured that they got 
the information together; they coalesced the information on 
spreadsheets and provided that to the Office of Management and 
budget.
    Mrs. Napolitano. Was this also coordinated with the State 
of California?
    Mr. Wright. Yes. We got the information both in working 
through Interior and OMB. Let me also just say in Interior and 
the Administration's defense that we do think it is useful to 
have that long list of Category B projects to have this kind of 
discussion, to have a debate over whether this local project 
should be counted or not, whether Turtle Bay should be counted 
or not. We may still need to do some more work on how you 
summarize those numbers to make sure you are getting accurate 
information, but the whole point of this exercise is to give 
you a handle on the total investment in California water 
infrastructure so that we can have this discussion on are we 
getting the kind of coordination that we need.
    Mrs. Napolitano. Thank you, Mr. Chair. I will go to the 
next round.
    Mr. Calvert. ClubFed; we ought to all get together and meet 
at the Salton Sea.
    [Laughter.]
    Mr. Calvert. Mr. Nunes?
    Mr. Nunes. Thank you, Mr. Chairman.
    I have an email that I would like to submit for the record 
and ask if you would give that email to the witnesses, please.
    Mr. Calvert. Without objection, so ordered. Please 
distribute the email.
    [The document follows:] 

    [GRAPHIC] [TIFF OMITTED] T7065.017
    
    [GRAPHIC] [TIFF OMITTED] T7065.018
    

    Mr. Nunes. And if I can make one more request, Mr. 
Chairman, there is part of this email that is not available, 
that has been cutoff, and I do not know if you can ask the 
witnesses to provide the rest of the email.
    Mr. Calvert. If in fact any additional correspondence could 
be added to this, we will certainly ask that that be provided 
as soon as possible.
    Mr. Nunes. Thank you.
    [Mr. Calvert's letter to Patrick Wright requesting the 
email in its entirety follows:]

[GRAPHIC] [TIFF OMITTED] T7065.019

    Mr. Nunes.
    Mr. Peltier, I know your position on political activity--
you answered that in the first round of questions--and Mr. 
Wright, and I think you both answered correctly, because 
Federal law prohibits both of you from engaging in political 
activity.
    That is why, Mr. Wright, I am curious as to why you 
referred people to the NRDC, which is a nongovernmental 
political organization, to speak with a CVPIA expert, as 
illustrated in your email conversation with Mr. Candee.
    Mr. Wright. I am often asked by Members of Congress who in 
the stakeholder community they should consult with to get the 
best information they need. I frequently refer them to members 
of the AGURB and environmental community so they get the best 
information they can, and certainly this email was a part of 
that process, and that is part of the ongoing process of having 
a collaborative process, to make sure--
    Mr. Nunes. That you advise the NRDC how to kill my 
legislation in Congress?
    Mr. Wright. I am not aware that this in any way advised 
them how to kill your legislation.
    Mr. Nunes. Well, I respectfully disagree with that, Mr. 
Wright, and I think that Mr. Peltier understands that also. 
That is why at the top of this email, Mr. Peltier definitely 
instructed--I think you said that you advised Mr. Raley to 
speak to Mr. Wright on this very issue, Mr. Peltier?
    Mr. Peltier. Yes, and they did talk. We had a conversation 
right around the time I sent this email, and I think we are 
comfortable that we had a better understanding than we got from 
the email about what was going on. And what I forwarded to your 
staff was what I had, so as to the question of do I have any 
more back and forth--this was it--and I did not get into any 
further.
    Mr. Nunes. Obviously, there is more to this email, and I 
know that we can find it.
    Mr. Chairman, can you ask the witnesses to provide the rest 
of this email?
    Mr. Calvert. Please. From the witnesses, if there is any 
additional email correspondence that would be appropriate, we 
would like to have that submitted for the record as soon as 
possible.
    We will keep the record of this hearing open for enough 
time for you to submit any additional correspondence that is 
out there. And we will follow up to make sure we obtain that 
email.
    Mr. Nunes. Thank you, Mr. Chairman.
    I am concerned because, as you can see by the tone of this 
email, there is obvious coordination between NRDC, which is a 
nongovernmental political group, political lobbying group, 
directly to this CALFED process, which gets back to your 
question about when are we going to see new storage projects. I 
do not know when we are going to see new storage projects when 
we are financing people who are actively engaging in activity 
that would slow down the process in getting to new surface 
storage.
    I am very concerned that we are going to continue--I think 
Mr. Radanovich was exactly right in asking the questions about 
the continued Federal participation, because we have not seen 
any new storage, nor is there a new storage facility that has 
even been designed, or at the design stage.
    So, Mr. Wright, I am extremely concerned that you are 
partial to an organization that is opposed to new surface 
storage. You instructed them to call various people in the 
Bureau to kill my legislation. And I do not know that you did 
it knowingly or on purpose--it could possibly be an accident--
but I am very concerned.
    There are more questions that I have on this email, Mr. 
Chairman. I do not know that it is germane to the topic that we 
are talking about, but I think that there are definitely not 
Federal dollars available to lobby political organizations.
    Mr. Calvert. Mr. Nunes, if you would like to submit a list 
of questions, we will instruct the witnesses to answer those 
questions.
    Mr. Nunes. Thank you.
    [A letter submitted for the record by Patrick Wright, 
Director, CALFED Bay-Delta Program, in response to a request 
for information by Mr. Nunes follows:] 
[GRAPHIC] [TIFF OMITTED] T7065.020


    Mr. Wright. And Mr. Chairman, I would be happy to follow up 
with you and the Congressman and also to share with you my 
voluminous emails with all the interests in California that I 
communicate with on a daily basis. This is simply one email out 
of thousands that I deal with.
    It is a delicate position that I am in, trying to move all 
these stakeholders together and support Members of Congress in 
their requests for information, and I will be happy to work 
with you further to make sure I do not cross any lines.
    Mr. Nunes. So, if I am hearing you correctly, do you mean 
you have instructed other organizations on how to kill my 
legislation?
    Mr. Wright. No, no, no. It did not take place here, and it 
has not taken place anywhere else, I assure you.
    Mr. Peltier. I would differ a little bit, but only in a 
kind of humorous fashion. I know that when I was a stakeholder, 
CALFED leaders and management told us to straighten up and fly 
right and get with the program and work together and quit 
fighting. So there was constructive advice given, not in the 
vein of political or anything like that, but CALFED management, 
CALFED agencies and participants, I think play an important 
role in moving the process forward, because stakeholders and 
agencies have their own missions and their own objectives and 
accomplishments, things they are trying to do, while not paying 
full-time, focused attention to the CALFED Program. And we rely 
on the CALFED staff and management, whose sole job is moving 
the program forward, to push and prod and remind the agencies 
and stakeholders of the bigger deal that they have all signed 
onto.
    Mr. Nunes. Thank you, Mr. Peltier.
    Thank you, Mr. Chairman.
    Mr. Calvert. One thing I want to point out in this email, 
whatever your position on CALFED may or may not be, is the tone 
of this email. It disturbs me, and I have dealt with all the 
stakeholders over the last number of years, and I have never 
tried to personalize this in any way--and I know, Mr. Wright, 
in your email here, that the gentleman involved in this email 
obviously has--unfortunately, I think--made a personal attack 
against Mr. Nunes, and I do not appreciate that. I would hope 
that anyone who is involved in this process would recognize 
that we are professionals here, and we have a job to do, and 
this type of attitude is certainly not appreciated by me, and I 
will certainly take note of anyone who engages in that kind of 
activity in the future.
    Mr. Peltier. If I could, Mr. Chairman, I share that--
Bennett and I share that--uncomfortableness, and actually more 
than that, kind of antagonism toward that kind of--what we saw 
in the email--and that in part prompted our concerns about it. 
We share your belief in way of doing business, that this is out 
of line, and it is not Patrick's part that is out of line, but 
we wanted to distance ourselves from that kind of language.
    Mr. Calvert. I appreciate that.
    Getting back to CALFED and the Bay-Delta, there is one 
thing--obviously, we are concerned about storage, and you can 
feel the frustration here in the time that it takes for us to 
get to the point where we can actually build the projects that 
are even in the Record of Decision. Many of us believe that the 
amount of storage that is in the Record of Decision is 
inadequate. But nevertheless, the storage that is in the Record 
of Decision needs to be built.
    But also, the other part of that is to convey the water and 
improvements that need to take place within the Delta to 
maintain water quality within the Delta. Certainly there are 
some issues with farmers and others in the Delta to make sure 
that the water quality is good and at the same time that we are 
able to convey water.
    So I guess the question is that the barriers that need to 
take place in the south of the Delta--I know that temporary 
improvements are in--but how quickly can we get--are we going 
through the same process in order to get those improvements in 
where we can convey water--if in fact we have water to convey, 
where we do not create problems within the Delta, but if the 
water is there to convey, we are not in the position to convey 
it at the present time, as you all know.
    So what is the timing of doing those improvements?
    I guess I will start with you, Patrick.
    Mr. Wright. Sure. We have a very aggressive program 
underway to try to increase the conveyance capacity of the 
State pumping plant. The draft environmental documents for 
those projects are due--I think late summer is the latest 
estimate. That also has to be coordinated with a whole series 
of other related actions to make sure that the Delta interests, 
Contra Costa interests, and water quality interests are 
protected as well, together with some Federal actions that are 
related. The final documents are due early next spring, so that 
by late spring or early summer, we are ready to go.
    This is not an issue that requires further construction. It 
is simply getting the permits that we need to use the available 
capacity that is there but is not being used.
    Mr. Peltier. If I could add, I think the CALFED and the 
program, particularly the science element, have added in a 
quantum fashion to our understanding of how the Delta works. As 
you may be aware, for 20 years, I believe, primarily the State 
and Federal water projects have provided about $15 million a 
year for the Interagency Ecological Program to study ecological 
functions in the Delta. We have moved significantly beyond the 
body of work that they have created through CALFED, with their 
investigations into how the Delta cross-channel works and how 
it affects water quality and fisheries. And there is a workshop 
coming up in a month or so, I believe, of the CALFED Science 
Program.
    To step back, it has been several years since we entered 
into the accord and had biological opinions in place, and it 
has been recognized that there is a need for the Science 
Program as well as the managers and the stakeholders to step 
back and look at the body of knowledge that we have gained over 
the last decade and see how our understanding has changed and, 
as a result of that, does the way that we operate in the Delta 
need to change.
    Mr. Calvert. And a little bit of education, I think, that 
we need to do in selling down in that region is that we are out 
to improve the water quality in the Delta and at the same time 
convey water. So we need to get out and amongst folks down in 
the Delta and explain that a little better, I think.
    Mrs. Napolitano?
    Mrs. Napolitano. No questions at this time.
    Mr. Calvert. Mr. Radanovich. Go ahead, George.
    Mr. Radanovich. Thank you, Mr. Chairman.
    Jason, can you tell me briefly what projects are currently 
not receiving funding due to the absence of CALFED 
appropriations? Are there any projects that are not moving 
forward in the absence of this funding?
    Mr. Peltier. Well, there are a lot of things that are not 
funded if you look at the Bureau portion of the budget. The 
funding is focused on environmental water account, storage 
probably is the bulk of it, funding the Tracy fish screen. The 
Bureau with its existing authority is limited in what it can 
do. It is limited in its ability to do work that people would 
like to see it do in broader watersheds; it is limited in its 
ability to fund a more sweeping consultation program with the 
Native American interests; it is limited in its ability to 
spend money, certainly to the extent that was envisioned in the 
ROD, to meet the mileposts. And as a result, we all recognize 
that the States' financial circumstances evolve, too.
    Mr. Radanovich. OK. Now, hang on, Jason. I only have a 
little bit of time here.
    I wanted to ask Mr. Mark Charlton, who is with the Army 
Corps of Engineers, if he could come to the mike. I would like 
to ask him a question regarding storage.
    Mr. Charlton, of the projects like Sites and Los Vaqueros, 
those that are in the ROD, assuming you got a green light 
today, can you give me an estimate of, if everything goes 
smoothly and according to plan, the physical time that it is 
going to take as far as when those projects would be on line?
    Mr. Charlton. Your question was my opinion as Deputy 
District Engineer at the Corps of Engineers--
    Mr. Radanovich. Sure.
    Mr. Charlton. --look at those projects that are currently 
underway in CALFED. Patrick referenced that a draft EIS on 
these projects would be complete at the end of this fiscal 
year. The idea is that these projects still need to be 
authorized by Congress. The Corps' experience is that there is 
at least a year for complex projects like this to go from a 
draft to a final to get it back to Congress.
    In the meantime, though, I would not see, if there were 
sufficient funding provided by Congress, why design at that 
point could not also begin. I would think that there would be 
for large projects like this--and Mr. Calvert made reference to 
the problems with large projects; it does take time to design 
these things--that there would probably, in my opinion, if 
sufficient funding were provided, be in the neighborhood of 4-
plus years for design before we would be able to begin 
construction.
    Now, on many of these projects, if we were very aggressive 
with the funding and the effort, parts of the project we may be 
able to move forward from a time schedule like that, because 
large projects like the Sites Reservoir or even the enlargement 
of Shasta have many pieces to them. Maybe some pieces could 
move ahead a little faster than other pieces, and while you 
build some early on pieces, you continue to do design on other 
pieces. So you stage the project like that.
    Depending on funding, that is our general experience for a 
timeframe.
    Mr. Radanovich. So you are looking, really, at 2010 before 
any of these storage projects are on line?
    Mr. Charlton. With the construction period, yes. That would 
probably be very aggressive. And if you look across the country 
at Corps of Engineers projects, these projects do take time, 
they are very large, they are very difficult, and that is very 
typical for public works projects of this nature.
    Mr. Radanovich. And that does not even account for lawsuits 
that might be filed to try to stop the projects, or anything 
like that--do those have an effect on the timing?
    Mr. Charlton. Of course they do; that is right. My 
assumption was that we would be successful, and there would not 
be problems of that nature.
    Mr. Radanovich. This was my concern--thank you, Mr. 
Charlton; I appreciate your insight--about keeping the 
stakeholders together and no one person getting out in front of 
the other. That was the whole idea with CALFED, was to keep the 
stakeholders together so that equal funding and equal progress 
on all counts, for all stakeholders, would happen at the same 
time.
    I was just handed a bit of information on Los Vaqueros 
Reservoir, which is in Sites, an article stating that there are 
groups out there that are planning to sue the stoppage of the 
enlargement of Los Vaqueros. And that group--basically, the 
ones that are anticipating trying to stop this project have 
been the bulk beneficiaries of the millions of dollars on 
ecosystem restoration that has been spent on CALFED so far. And 
that was the whole idea of not letting one group out more than 
the other, because then all the stakeholders' needs might not 
get satisfied.
    So when I asked the question about what set of criteria do 
you have in place to achieve such balance in the implementation 
of CALFED, I think it is very, very important for CALFED to 
have figured out in 1995, and in the absence of that even 
today, it still behooves people to be sure that you do have 
some kind of criteria in place to make sure there is balance in 
this, because one interest group can just jump right off this 
process and sue the pants off anybody else to stop progress on 
any other element of this CALFED plan.
    So I would like to see some set of criteria to make sure 
there is balance in this program at least from here on out, 
because it has not been up to this point, and we are looking at 
2010 even if things went lickety-split and very smoothly, and 
that of itself is too long.
    So I just needed to make that point and wish that I could 
see somebody come back and make sure that the emphasis from 
here on out is really applied to storage until we get some kind 
of balance in this thing.
    Mr. Peltier. I would say we could provide that information. 
The ROD does have quite a discussion of balance in it, and I 
think the criteria are reasonably well-spelled out there in 
terms of guidance.
    Mr. Radanovich. Can that prevent the lawsuits on any of 
these water storage projects, Jason, that are going to come up 
along the line? The only leverage you had was giving the other 
stakeholders what they wanted, or making them wait until this 
whole thing was moved forward together. That was the whole idea 
of CALFED--keeping the stakeholders together and moving 
everybody forward at the same time. It has not happened, and 
water storage projects are looking, as a result of that, beyond 
2010.
    Thank you.
    Mr. Calvert. Thank you.
    Before I go to Mrs. Napolitano, I guess to summarize what 
Mr. Radanovich's fears are--and many of us--is the bait-and-
switch thing, that we go so far down the line that all the 
money has been spent on environmental restoration, all those 
projects are completed, and then the same coalition of folks 
that we had put together all of a sudden disintegrates, and 
they come out opposed to all the storage projects and in fact 
file suit against the very projects, as Mr. Radanovich said, as 
happened at Los Vaqueros.
    Mrs. Napolitano?
    Mrs. Napolitano. Thank you, Mr. Chairman.
    Dovetailing into Mr. Radanovich's point, I would also like 
to have a report on how much usable water would be produced by 
these construction projects, these dam projects. I would also 
like to have a comparison of the time to construct and the 
water produced by recycling, the cost timeframe.
    That would be very helpful in being able to at least move 
us forward to the 4.4 plan for 2016 for California, or at least 
in my mind, that is part of it.
    I would submit that for the record.
    Mr. Calvert. Without objection.
    Mrs. Napolitano. I would also like to refer to Title XVI as 
shown in the cross-cut budget for Fiscal Year 2003 was $18 
million, and for 2004, $13.2 million. Do these figures reflect 
the deduction we are paying for the Sumner Peck drainage 
settlement?
    Mr. Peltier. For 2003?
    Mrs. Napolitano. 2003 is $18 million; 2004 is $13.2 
million, a reduction of $4.8 million.
    Mr. Peltier. Right. My understanding of those numbers is 
that 2003 is the enacted level, and 2004 is the number that is 
in the President's budget. In 2003, my understanding is that 
the Peck settlement was funded from the judgment fund. I am not 
certain how it is treated in the 2004 budget; I will have to 
get that information and provide it to you.
    Mrs. Napolitano. We would like to have that information, if 
you would not mind.
    I would also like to make a point, because we keep saying 
that the environmental restoration has been taking a 
considerable amount of attention, which in some areas I think 
is rightfully adequate, or at least should be--but that also 
includes, if I am not mistaken, the restoration of the 
fisheries, the areas that produce salmon, which is part of 
California's economy.
    So I want to be sure that we get that straightened out, 
that we figure out how much actually goes for environmental 
versus restoration of fisheries and other areas. I would say it 
is more than 50 percent, but I would like to see how that 
parcels out.
    I read in somebody's report that the fisheries and the 
hatcheries and the salmon are beginning to rebound from the 
lows that were evidenced in the last few years. To me, that 
goes hand-in-hand--we have economy, we have the ability to be 
able to have funding, if you will, for the projects that are 
needed, to be able to have those in 4.4, and to be sure that 
all of California has adequate water supply and so on.
    Mr. Peltier. I would say it is in some cases quite 
exciting. The response of winter run salmon over the last few 
years, for instance, has been very impressive.
    However, the challenge is--answering the question why did 
the numbers go up, we would hope that in part, it is a result 
of the investment in fish screen and in fish passage and in 
habitat improvements, in modification of project operation. We 
hope and expect that all of that investment in ecosystem 
improvement is going to lead to a result that is of 
significance. That is why I think it is widely recognized that 
part of the critical path to getting to reliable water supply 
is that ecosystem investment.
    But there is uncertainty. Certainly we cannot ascribe very 
specifically what the result of these investments is, because 
there are in fact many other factors that affect the health of 
the fisheries beyond the habitat that we are focused on.
    Mrs. Napolitano. Right, but we must not say that the issue 
of environmental restoration is totally the Endangered Species 
Act.
    Mr. Peltier. That is correct. There is a significant amount 
of the investment that is made and the operational 
restrictions, as a matter of fact, that it is recognized that 
those investments and those decisions have collateral benefits 
for other species. And while we want to make sure that we are 
focused adequately on the needs of the listed species, we fully 
recognize that there are collateral benefits, and that is much 
appreciated.
    Mrs. Napolitano. Mr. Wright?
    Mr. Wright. Yes, just to add to that, as Jason said and as 
Mr. Radanovich alluded to, in 1995, there was broad-based 
agreement in California that we needed to give the ecosystem 
program a down payment, which is why Congress authorized us to 
spend a couple hundred million dollars on the ecosystem program 
to turn around the significant declines in the fisheries of the 
estuary.
    Those investments, as Jason said, have paid off not only in 
terms of trying to begin to reverse the decline of the fish 
species but also in terms of water supply. The allocations of 
water south of the Delta, pumping constraints, are less 
significant today because of those fisheries investments. 
Allowable take, for instance, for listed species is higher 
today than it was several years ago, so there is a direct 
correlation between the ecosystem investments we have made and 
improvements in water supply, and certainly we hope that will 
continue.
    Mrs. Napolitano. Thank you very much.
    Thank you, Mr. Chair.
    Mr. Calvert. I thank the gentlelady.
    Mr. Nunes?
    Mr. Nunes. No further questions, Mr. Chairman.
    Mr. Calvert. I would like to ask a quick question--oh, 
excuse me, sorry. Please ask your global warming question, Mr. 
Inslee.
    Mr. Inslee. Would it be appropriate if I just give the 
answer, too, Mr. Chairman?
    Mr. Chairman, I will pass today. Thank you very much.
    Mr. Calvert. Thank you.
    I have a question just for my own edification, and 
possibly, Jason, one of the people that you have brought with 
you can answer this question, or maybe Patrick knows the 
answer.
    We have had a pretty good snowfall, thank God, in the 
Sierras, so where are we right now as far as the snowpack and 
our estimates for water this year?
    Mr. Peltier. Could I bring Kirk Rogers, the Regional 
Director, to the table?
    Mr. Calvert. Absolutely; bring him up.
    Mr. Rogers. Thank you, Mr. Chairman.
    My name is Kirk Rogers, and I am the Regional Director for 
the Bureau of Reclamation in Sacramento.
    Certainly the snowpack has improved, and the water supply 
in our reservoirs is increasing. In fact, we have been 
releasing for flood control out of Shasta on a continuous basis 
recently to make room. We had a very full reservoir there and 
incoming storms.
    However, for most of the watershed, I believe our water 
year designation remains at below normal in the Sacramento area 
and dry in some of the other areas. So even with these improved 
conditions, our water year designations have not changed. That 
could change when we move into the next month's allocation, 
though, so we are still hopeful.
    Mr. Calvert. Do you have any information, too, on the 
Rockies and the situation in the Colorado River, any 
improvement with Lake Powell, Lake Mead?
    Mr. Rogers. It is extraordinarily dry there, still, Mr. 
Chairman, and no real marked improvements that I have been 
reported on.
    Mr. Calvert. Thank you.
    Are there any additional questions?
    Mrs. Napolitano. Yes, one question, since we now have the 
gentleman from Sacramento here, and it is related to Northern 
California instituting water meters. What is the timeframe, 
what is the time line, and how does that fit in with the CALFED 
Record of Decision? Is that part of it, to be able to ensure 
that that happens?
    Mr. Rogers. Under the Central Valley Project Improvement 
Act, there was a provision for water measurement and a 
condition that we need to put in all the contracts that we 
renew for water service for those municipalities that we have 
contracts with.
    As we have renewed the contracts, we have imposed that 
requirement. The City of Folsom is one, and there is a schedule 
in place for them to put their meters in place. The City of 
Fresno is an area where discussion continues, and we have not 
been able to resolve that issue yet, because there is a local 
ordinance that prevents them from putting water meters in.
    The City of Sacramento has prior water rights, and we do 
not have a contract with them, and I do not know of any effort 
that they are making other than voluntary in some parts of the 
new construction area for putting water meters in those 
locations.
    But it is a concept that we support. We believe that as you 
put water meters in, you get a response from the community.
    Mrs. Napolitano. Thank you.
    It is always amazing--I lived in Sacramento for 6 years 
during my tenure in the Statehouse--that we do not pay water. 
Even my staff had a meter that was not connected to anything; 
it was for view only. When you are asking Southern California 
because of drought conditions to go into total conservation and 
other very drastic steps, and my colleagues and my friends in 
Northern California may use water to any extent, that needs to 
change, and I hope that we all abide by the same rules and that 
we are able to share water equally.
    Mr. Rogers. We agree with you, and in those areas where we 
have that responsibility, we are pursuing it vigorously. 
Personally, I live in a community that has a water meter, and I 
know personally that it influences the way I choose to use my 
water.
    Mrs. Napolitano. Thank you so very much, sir.
    Thank you, Mr. Chair.
    Mr. Calvert. Thank you.
    I certainly thank our witnesses, and I thank those who 
attended this hearing.
    We are adjourned.
    [Whereupon, at 11:45 a.m., the Subcommittee was adjourned.]

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