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



 CONTROLLING BIOTERROR: ASSESSING OUR NATION'S DRINKING WATER SECURITY

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

                                HEARING

                               before the

          SUBCOMMITTEE ON ENVIRONMENT AND HAZARDOUS MATERIALS

                                 of the

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED EIGHTH CONGRESS

                             SECOND SESSION

                               __________

                           SEPTEMBER 30, 2004

                               __________

                           Serial No. 108-123

                               __________

      Printed for the use of the Committee on Energy and Commerce

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

                               __________


                   U.S. GOVERNMENT PRINTING OFFICE
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____________________________________________________________________________
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                    COMMITTEE ON ENERGY AND COMMERCE

                      JOE BARTON, Texas, Chairman

W.J. ``BILLY'' TAUZIN, Louisiana     JOHN D. DINGELL, Michigan
RALPH M. HALL, Texas                   Ranking Member
MICHAEL BILIRAKIS, Florida           HENRY A. WAXMAN, California
FRED UPTON, Michigan                 EDWARD J. MARKEY, Massachusetts
CLIFF STEARNS, Florida               RICK BOUCHER, Virginia
PAUL E. GILLMOR, Ohio                EDOLPHUS TOWNS, New York
JAMES C. GREENWOOD, Pennsylvania     FRANK PALLONE, Jr., New Jersey
CHRISTOPHER COX, California          SHERROD BROWN, Ohio
NATHAN DEAL, Georgia                 BART GORDON, Tennessee
RICHARD BURR, North Carolina         PETER DEUTSCH, Florida
ED WHITFIELD, Kentucky               BOBBY L. RUSH, Illinois
CHARLIE NORWOOD, Georgia             ANNA G. ESHOO, California
BARBARA CUBIN, Wyoming               BART STUPAK, Michigan
JOHN SHIMKUS, Illinois               ELIOT L. ENGEL, New York
HEATHER WILSON, New Mexico           ALBERT R. WYNN, Maryland
JOHN B. SHADEGG, Arizona             GENE GREEN, Texas
CHARLES W. ``CHIP'' PICKERING,       KAREN McCARTHY, Missouri
Mississippi, Vice Chairman           TED STRICKLAND, Ohio
VITO FOSSELLA, New York              DIANA DeGETTE, Colorado
STEVE BUYER, Indiana                 LOIS CAPPS, California
GEORGE RADANOVICH, California        MICHAEL F. DOYLE, Pennsylvania
CHARLES F. BASS, New Hampshire       CHRISTOPHER JOHN, Louisiana
JOSEPH R. PITTS, Pennsylvania        TOM ALLEN, Maine
MARY BONO, California                JIM DAVIS, Florida
GREG WALDEN, Oregon                  JANICE D. SCHAKOWSKY, Illinois
LEE TERRY, Nebraska                  HILDA L. SOLIS, California
MIKE FERGUSON, New Jersey            CHARLES A. GONZALEZ, Texas
MIKE ROGERS, Michigan
DARRELL E. ISSA, California
C.L. ``BUTCH'' OTTER, Idaho
JOHN SULLIVAN, Oklahoma

                      Bud Albright, Staff Director

                   James D. Barnette, General Counsel

      Reid P.F. Stuntz, Minority Staff Director and Chief Counsel

                                 ______

          Subcommittee on Environment and Hazardous Materials

                    PAUL E. GILLMOR, Ohio, Chairman

RALPH M. HALL, Texas                 HILDA L. SOLIS, California
JAMES C. GREENWOOD, Pennsylvania       Ranking Member
HEATHER WILSON, New Mexico           FRANK PALLONE, Jr., New Jersey
VITO FOSSELLA, New York              ALBERT R. WYNN, Maryland
  (Vice Chairman)                    LOIS CAPPS, California
STEVE BUYER, Indiana                 MICHAEL F. DOYLE, Pennsylvania
GEORGE RADANOVICH, California        TOM ALLEN, Maine
CHARLES F. BASS, New Hampshire       JANICE D. SCHAKOWSKY, Illinois
JOSEPH R. PITTS, Pennsylvania        CHARLES A. GONZALEZ, Texas
MARY BONO, California                PETER DEUTSCH, Florida
LEE TERRY, Nebraska                  BOBBY L. RUSH, Illinois
MIKE ROGERS, Michigan                BART STUPAK, Michigan
DARRELL E. ISSA, California          GENE GREEN, Texas
C.L. ``BUTCH'' OTTER, Idaho          JOHN D. DINGELL, Michigan,
JOHN SULLIVAN, Oklahoma                (Ex Officio)
JOE BARTON, Texas,
  (Ex Officio)

                                  (ii)




                            C O N T E N T S

                               __________
                                                                   Page

Testimony of:
    Grumbles, Benjamin H., Acting Assistant Administrator for 
      Water, U.S. Environmental Protection Agency................    37
    Stephenson, John B., Director, Natural Resources and 
      Environment, Government Accountability Office..............    44
Additional material submitted for the record:
    Stephenson, John B., Director, Natural Resources and 
      Environment, Government Accountability Office, response for 
      the record.................................................    76
    U.S. Environmental Protection Agency, response for the record    78

                                 (iii)

  

 
 CONTROLLING BIOTERROR: ASSESSING OUR NATION'S DRINKING WATER SECURITY

                              ----------                              


                      THURSDAY, SEPTEMBER 30, 2004

              House of Representatives,    
              Committee on Energy and Commerce,    
                            Subcommittee on Environment    
                                   and Hazardous Materials,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 2:33, p.m., in 
room 2322, Rayburn House Office Building, Hon. Paul E. Gillmor 
(chairman) presiding.
    Members present: Representatives Gillmor, Bass, Terry, 
Rogers, Solis, Pallone, Capps, and Stupak.
    Staff present: Tom Hassenboehler, majority counsel; Mark 
Menezes, majority counsel; Jerry Couri, policy coordinator; 
Peter Kielty, legislative clerk; and Dick Frandsen, minority 
counsel.
    Mr. Gillmor. The subcommittee will now come to order and 
the Chair will recognize himself for the purposes of an opening 
statement.
    Many people believe that our government's focus on 
protecting our infrastructure from terrorist attacks began 
after the attacks on the World Trade Center and the Pentagon. 
That assessment, I think, however, would be inaccurate.
    It was over 50 years ago that the FBI was worried that an 
attack on our Nation's drinking water system could have 
devastating effects on the Nation's health and well-being. 
Unfortunately, it took the scare our Nation felt 3 years ago 
before Congress took action to fill in the legal gaps that 
prevented real preparedness from occurring.
    I am proud that our committee took the bipartisan lead with 
the Public Health Security and Bioterrorism Response Act of 
2002. This law took a major step forward in providing all 
drinking water systems with legal direction for safeguarding 
their product and their facilities.
    This legislation not only recognized the need to protect 
our large urban centers or 15 percent of the community water 
systems that served 75 percent of the population, but also the 
need to look after smaller systems that did not have the 
resources but were every bit as vulnerable. Under this law, 
each community water system serving more than 3,300 individuals 
is required to conduct an assessment of the system's 
vulnerability to terrorist acts or other intentional acts to 
disrupt a safe and reliable drinking water supply. The Act also 
requires these systems to prepare or revise emergency response 
plans, incorporating the results of the vulnerability 
assessments and to do so no later than 6 months after 
completing them.
    To pay for this, the Bioterrorism Act authorized funding to 
provide financial assistance to community water systems 
conducting those vulnerability assessments, preparing response 
plans and addressing the basic security enhancements.
    And finally, the Act authorized the EPA to review methods 
by which terrorists or others could disrupt the provision of 
safe water supplies and identify methods for preventing, 
detecting, and responding to such disruptions.
    These are all good things, but they are not--will not--
deter us from conducting the kind of oversight to make sure the 
money spent is going to places where Congress intended; that 
water utilities are complying with the rules set forth, and 
that meaningful protections are occurring across our country.
    In addition, we must know how the Federal apparatus that 
has since come into play, including the Department of Homeland 
Security, and subsequent Presidential directives are working in 
guiding drinking water protection from terrorism.
    I also want to note one part of the bioterrorism law that I 
think was very important, and generated much discussion when we 
passed the law. In trying to provide for the collection of 
meaningful compliance information--and also discouraging the 
use of this information in inappropriate ways, Congress 
required water systems to certify to the EPA that they had 
conducted a vulnerability assessment and submitted a copy of 
the assessment to EPA. But, Congress also exempted the main 
contents of the vulnerability assessments from disclosure under 
the Freedom of Information Act.
    In addition, the law directed EPA to develop protocols to 
protect the assessments from unauthorized disclosure and 
provides for civil and criminal penalties for inappropriate 
disclosure of information by government officials. I am 
interested in knowing how these protections are working.
    And also, before closing my remarks, I want to thank our 
witnesses who are with us today: Mr. Benjamin Grumbles of the 
EPA, whom we have met with before; and Mr. John Stephenson, 
director of Natural Resources and Environment of GAO. We are 
very pleased to have you here, and we want you to know how much 
we value your input.
    I would like to recognize the ranking member of our 
subcommittee, the gentlelady from California.
    [The prepared statement of Hon. Paul Gillmor follows:]
  Prepared Statement of Hon. Paul Gillmor, Chairman, Subcommittee on 
                  Environment and Hazardous Materials
    The Subcommittee will now come to order and the chair will 
recognize himself for 5 minutes for the purposes of delivering an 
opening statement.
    Many people believe that our government's focus on protecting our 
infrastructure from terrorist attacks began after the terrible attacks 
on the World Trade Center and Pentagon that occurred on September 11, 
2001. This assessment, however, would be false. Over 50 years ago, the 
Federal Bureau of Investigation was worried that an attack on our 
nation's drinking water system would have devastating effects on the 
nation's human and economic health and well-being. Unfortunately, it 
took the scare our nation felt three years ago before Congress took 
action to fill in the legal gaps that prevented real preparedness from 
occurring.
    I am proud that our Committee took the bipartisan lead in 
fashioning the Public Health Security and Bio-terrorism Preparedness 
and Response Act of 2002. This law took a major step forward in 
providing all drinking water systems with legal directions for 
safeguarding their product and their facilities. I am particularly glad 
that this legislation not only recognized the obvious need to protect 
our large urban centers where 15 percent of all community water systems 
serve 75 percent of the population, but also the need to look after 
smaller systems that did not have the resources but were every bit, if 
not more vulnerable than their big city brethren.
    This law should make a real difference in the future safety of 
drinking water systems. Under this law, each community water system 
serving more than 3,300 individuals is required to conduct an 
assessment of the system's vulnerability to terrorist attacks or other 
intentional acts to disrupt the provision of a safe and reliable 
drinking water supply. The Act also requires these systems to prepare 
or revise emergency response plans incorporating the results of the 
vulnerability assessments no later than 6 months after completing them. 
To fund all these items, the Bioterrorism Act authorized funding to 
provide financial assistance to community water systems conducting 
vulnerability assessments, preparing response plans, and addressing 
basic security enhancements and significant threats. Finally, the Act 
authorized EPA to review methods by which terrorists or others could 
disrupt the provision of safe water supplies, and identify methods for 
preventing, detecting, and responding to such disruptions.
    These are all good things, but they should not deter us from 
conducting the kind of oversight that makes sure the money spent is 
going to the places Congress intended, the water utilities are 
complying with the rules set forth, and meaningful protections are 
occurring across our country. In addition, we must know how the Federal 
apparatus that has since come into play, including the Department of 
Homeland Security, and subsequent presidential directives are guiding 
drinking water protection from terrorism. This panel must not be 
deterred in appropriately exercising its jurisdiction over drinking 
water safety and supply. This is a charter that I take very seriously 
as Chairman and it is one that no committee in the House can or should 
do better.
    I want, though, to make note of one part of the Bio-terrorism law 
that I find very important and that generated much discussion when we 
passed this law. In trying to carefully choreograph the dance between 
the collection of meaningful compliance information and discouraging 
the use of this information as a way to discover other places EPA might 
wish to regulate, Congress required water systems to certify to EPA 
that they have conducted a vulnerability assessment and submit a copy 
of the assessment to EPA, but Congress also exempted the main contents 
of the vulnerability assessments from disclosure under the Freedom of 
Information Act. In addition, the law directed EPA to develop protocols 
to protect the assessments from unauthorized disclosure, and provides 
for civil and criminal penalties for inappropriate disclosure of 
information by government officials. Forcing EPA to take sensitive 
information was only acceptable to many of us if serious protections 
were put into place on that material. I am interested in knowing how 
those protections are working.
    Finally, before closing my remarks, I want to thank our witnesses 
who are here with us today. You know how much we value your input and 
look forward to your testimony and commentary.
    With that, I want to recognize the Ranking Member of the 
Subcommittee, the gentle lady from California, Mrs. Solis, for 5 
minutes for the purpose of delivering an opening statement.

    Ms. Solis. Thank you, Mr. Chairman, and I thank you for 
holding this hearing today. This is a very important issue for 
many of us, the safety and security of our drinking water.
    But I do have to say that I am a bit disappointed, because 
I believe it is a disservice to the members of the subcommittee 
that the Department of Homeland Security has failed to respond 
to our request to testify before this subcommittee. And I find 
it unfortunate that we are holding this hearing without the 
benefit of hearing from the Inspector General of the 
Environmental Protection Agency.
    I understand we received a letter in our office, just today 
that was faxed over, informing us that they could not come but 
if we have any further questions, we could submit them. The 
inspector general has released numerous reports critiquing the 
status of security at facilities. And last September, the 
Inspector General found serious vulnerabilities in the EPA's 
action to combat contamination of our water supply as a result 
of terrorism.
    The Inspector General highlighted that EPA had failed to 
sufficiently provide information about threats. Reports noted 
that as a result, major utilities were having problems 
identifying and prioritizing threats to our water supply.
    I hope today that EPA will address the findings of the 
Inspector General because these vulnerabilities are 
unacceptable. We see the news in every day stories about 
drinking water being tainted by lead and rocket fuel and other 
contaminants.
    When rocket fuel was found in milk, parents became outraged 
and questioned whether it was safe to serve their children 
milk. What would these same parents say if they knew about 
unaddressed vulnerabilities in drinking water? It is the 
responsibility of EPA to assure the public that not only have 
water utilities filed the necessary paperwork, but that the 
necessary upgrades have been made and that our drinking water 
is safe and secure.
    The city of Los Angeles Department of Water and Power 
serves water and power to over 3.8 million users. In response 
to 9/11, Los Angeles devised a 5-year plan to increase daily 
sampling and test water quality. They installed security 
cameras, increased helicopter patrols and reinforced security 
barriers at water facilities.
    These upgrades are being funded by an increase in consumer 
rates. I support the efforts of Los Angeles to secure its water 
facilities as much as possible. But I wonder where the EPA has 
been as Los Angeles makes these upgrades. What kind of role has 
EPA played in the development of the security policies of 
cities across the country? What kind of guidance have you given 
cities like Los Angeles. And why has the Inspector General time 
and time again revealed vulnerabilities in EPA's guidance? I 
hope we hear answers to these questions from EPA today.
    Finally, I would also like to mention how unfortunate it is 
that another year has gone by and Congress still has not 
addressed chemical facility security.
    There are more than 100 facilities nationwide, whose 
vulnerability puts at risk more than 1 million people each. As 
more than 60 editorials across the country have noted, 
Congress's inability or refusal to act to secure chemical 
facilities is a dereliction of duty. I sincerely hope this 
dereliction of duty isn't because my colleagues are afraid to 
challenge the chemical industry, the grave threat posed by 
chemical facilities is unneccessary--and I only hope that we 
will not be forced to regret this decision later.
    Before I yield back the balance of my time, I would like to 
ask for unanimous consent that if the ranking member of the 
full committee, Mr. Dingell, and other and other members 
provide opening statements, that they be allowed to be inserted 
into the record.
    Mr. Gillmor. Without objection, it will be so ordered. All 
members will be able to submit opening statements to be 
inserted in the record.
    Does the gentleman from Michigan have an opening statement?
    Mr. Rogers. I yield, Mr. Chairman.
    Mr. Gillmor. The gentlemen yields.
    The gentlewoman from California.
    Mrs. Capps. Thank you very much, Mr. Chairman, for holding 
this hearing.
    The September 11 terrorist attacks on our country and the 
anthrax incidents that followed changed the way we looked at 
protecting our Nation's most critical infrastructure. They 
raised serious questions about our preparedness to respond to 
future catastrophic terrorist attacks, and they made Americans 
concerned about all aspects of our safety, including our 
drinking water supply.
    The President raised drinking water concerns in his 2002 
State of the Union Address. He stated that U.S. Forces in 
Afghanistan found diagrams of U.S. Public water utilities and 
that we are under ``continuing and immediate threats of future 
attacks. A successful terrorist attack on a public water system 
would be devastating.''
    In addition, it would further damage public confidence and 
safe and reliability supplies of drinking water, so we need 
this afternoon to assess whether the administration is pursuing 
an effective strategy to prevent or to respond to such attacks. 
Many experts are concerned, and for good reason.
    In fact, the EPA's Inspector General has conducted 
preliminary research on how well we have evaluated water system 
security activities. As you know, EPA has responsibility over a 
safe-guarded water supply. In 2002, Congress passed a 
Bioterrorism Act, and this bill required the water utilities to 
assess vulnerabilities based on threat information provided by 
EPA and then submit these vulnerability assessments to EPA for 
their review. Vulnerability assessments are a necessary tool 
for drinking water utilities to evaluate and identify their 
vulnerabilities.
    But vulnerability assessments alone don't protect us from 
the threats. They only detect them. And according to the 
Inspector General, EPA may not be taking the necessary steps to 
maintain a safe and reliable drinking water supply. For 
example, the IG has reported that due to limited threat 
information provided by EPA, the utilities design their 
assessments around pre-September 11 threats.
    Based on interviews with key stakeholders, the IG went on 
to include ``we believe that vulnerability assessments 
submitted may emphasize traditional less consequential and less 
costly threats such as vandalism or disgruntled employees.''
    This is certainly not what we are talking about post-9/11. 
How can we expect to adequately assess the specific 
shortcomings of our public water systems, much less implement 
protective measures, without an accurate evaluation of 
realistic threats. The world changed on September 11. It 
changed the way we need to detect and protect ourselves from 
threat.
    Yet if the IG's reports is accurate that water utilities 
were not provided with updated and accurate threat information, 
then the water utilities may be defending our water supply from 
yesterday's disgruntled employees instead of today's enemies. 
Merely completing the vulnerability assessments are not going 
to reduce these unacceptable security risks.
    We have to also take corrective actions to reduce them. 
While I am very disappointed the IG is not able to join us to 
discuss these important issues, I certainly hope our witnesses 
will address his concerns. In his absence, I ask unanimous 
consent to insert two evaluation reports from the Office of the 
Inspector General dated September 11, 2003 and September 24, 
2003 into the record, Mr. Chairman.
    Mr. Gillmor. Without objection.
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    Mrs. Capps. Mr. Chairman, securing the extensive network of 
our Nation's drinking water storage systems poses difficult 
challenges but the stakes are too high to shirk this 
responsibility. Tampering or destroying these systems would 
leave large population areas without water for consumption or 
fire-fighting purposes.
    So I hope that precious time and money was not wasted by 
the EPA's failure to insure accurate vulnerabilities 
assessments keyed to post September 11 threats. Each day that 
passes without insuring that the necessary security 
enhancements are being undertaken is another day that our 
Nation's water supplies remain vulnerable.
    So once again, this is a very timely hearing. I thank you 
for holding it and look forward to the testimony of our 
witnesses.
    I yield back.
    Mr. Gillmor. The gentlewoman yields back. Does the 
gentleman from Nebraska have an opening statement?
    Mr. Terry. No.
    Mr. Gillmor. The gentleman yields.
    The gentleman from New Jersey.
    Mr. Pallone. Thank you, Mr. Chairman.
    I appreciate that you are giving us a chance in this 
subcommittee to conduct an oversight hearing on water security, 
which is one of the most pressing Homeland Security issues 
facing our country.
    While it is certainly good that we are discussing water 
security, I want to express my dismay that this subcommittee, 
in fact, the entire House, has not held a single hearing to 
discuss security at the numerous chemical plants located in New 
Jersey and across the Nation.
    As many of my colleagues may be aware, I have introduced 
H.R. 1861, the Chemical Security Act. This bill would, among 
other things, require that EPA promulgate regulations directing 
the owners of high priority chemical security plants to conduct 
vulnerability assessments and create a prevention, 
preparedness, and response plan much like the water programs 
that we will be discussing today.
    But I can't emphasize enough the danger posed by chemical 
plants across the country. According to the EPA, there are 123 
facilities across the country where release of chemicals could 
threaten more than 1 million people. There are more than 750 
facilities where such a release could threaten upwards of 
100,000 people--and these are frightening numbers. Despite this 
obvious threat, this subcommittee has done nothing on the 
issue. Last October, several of my colleagues joined me in then 
writing to then Chairman Tauzin asking that the committee 
address chemical security, but we have seen nothing since.
    Through some combination of congressional and executive 
action, we have dealt port security, airline security and even 
nuclear security. If we are serious about securing our homeland 
and protecting our citizens, we need to address chemical 
security immediately.
    Today's hearing--if I can say, Mr. Chairman, I look forward 
to the hearing and to hear what Mr. Grumbles and Mr. Stephenson 
have to stay. But, as we mentioned, this panel is clearly 
incomplete.
    We are not going to hear from the EPA Inspector General, 
who issued two reports last September that were critical of the 
EPA's water security efforts. We are also not going to hear 
from the Department of Homeland Security, whom I understand 
simply refused to cooperate with the majority's request.
    Yet this is a Congressional subcommittee. We have a serious 
oversight responsibility and the power to demand serious 
responses from the administration. And it is time this 
subcommittee and the Congress stand up to this administration. 
They are simply not cooperating. The Bush administration 
doesn't cooperate, whether it is water security or the lack of 
action on chemical security.
    It is just a sad commentary on the state of oversight in 
this Congress, in contrast to the days when a Democrat was in 
the White House. This Congress has done very little to oversee 
the actions of the Bush Administration.
    Mr. Gillmor. The gentleman yields back.
    Does the gentleman from New Hampshire have an opening 
statement.
    Mr. Bass. I do, Mr. Chairman, I do have an opening 
statement I would like to have placed in the record.
    Mr. Gillmor. Without objection.
    Mr. Bass. I would like to spend a minute and a half to tell 
an interesting little story.
    We all remember 9/11 and what happened and how we found 
ourselves wandering around Capitol Hill looking for a place to 
go. I wound up at about noon, I think, in the headquarters of 
the Capitol Police over next to The Monocle on the Senate side. 
I was a motley crowd of Senators and Congressman sitting around 
the table looking kind of dazed. And the chief of the Capitol 
Police gave us a briefing, which was somewhat sketchy, about 
what he thought was going on. And Senator Byrd from West 
Virginia was there. And they had placed around the table all 
these pitchers of water and so forth for us to drink.
    Senator Byrd said, what reason do you have to believe that 
the water supply in the District of Columbia hasn't been 
poisoned yesterday, and that we are--can't drink the water? We 
saw eight or 10 hands surreptitiously move across the table and 
push the pitchers to the other side of the table.
    It only points out--that for me, at least, I realized just 
how significant protection of water resources can be in times 
of crisis. And this is a very timely hearing. Given the fact 
that only 15 percent of our water utilities control 75 percent 
of the population of this country, this is localized high 
priority for security. I think there are questions about 
whether or not it is practical or possible to really affect 
large segments of the population with any kind of ease, if you 
will. But nonetheless, I think this is an important subject and 
I commend the chairman for having this hearing and I yield 
back.
    [The prepared statement of Hon. Charles F. Bass follows:]
    Prepared Statement of Hon. Charles F. Bass, a Representative in 
                Congress from the State of New Hampshire
    Thank you Mr. Chairman. It is important to note that the safety of 
our water supply is not a novel concern for our government. Since 1941, 
the federal government has recognized the possible threat to our 
national water supply--both by natural disasters and man-made threat. 
The fear of terrorist attacks on U.S. water utilities existed prior to 
9/11 when EPA was identified as the leading federal agency to oversee 
security issues of our water infrastructure. Since the attack on 
American soil, the need to identify and address vulnerability has only 
become more imperative.
    This hearing comes at a critical time due to the various 
legislative efforts in both Houses to address the recommendations of 
the 9/11 Commission. Since the creation of the Department of Homeland 
Security, EPA has continually retained their jurisdiction over water 
supply safety. It is critical for us to reassess how well this has 
worked with identifying potential threats, identifying and addressing 
points of vulnerability, and creating emergency plans. It is also 
important for us to include water supply safety in any decision that is 
related to coordination of intelligence and restructuring our agencies 
involved in homeland security.
    Finally, this hearing is critical in discussing some of the types 
of potential threats that may exist to our water supply. Only 15% of 
our water utilities supply 75% of our population--and it is important 
for the public to understand the dangers that these utilities face. 
Some experts have argued that due to dilution and lengthy time for 
water to reach the home--the threat to public health is small. However, 
a threat to actually destroying the infrastructure is much greater. By 
including the public in these types of discussions, it helps elevate 
any unnecessary fears that may exist.
    I would like to thank our witnesses for being here today and look 
forward to hearing their testimony. Thank you.

    Mr. Gillmor. The gentleman yields back. Does the other 
gentleman from Michigan have an opening statement?
    Mr. Stupak. Yes, I do, Mr. Chairman, and thank you for 
holding this hearing.
    I want to thank Mr. Grumbles from the EPA and Mr. 
Stephenson from the Government Accountability Office for being 
here today as we discuss the safety and the security of our 
Nation's drinking water.
    While I appreciate the chance to hear from our two 
witnesses today. I would have appreciated the chance to hear 
from anyone from the EPA's office of Inspector General as well 
considering the office's unique insight into this matter.
    I would also like to hear testimony from the Department of 
Homeland Security, which plays a role in this issue, but has 
failed to respond to requests to testify before this 
subcommittee. The state of our Nation's drinking water supply 
is not something to be taken lightly. Clearly an attack on our 
Nation's water supply could have devastating consequences. That 
makes this hearing particularly important and the absence of 
witnesses from today's Homeland Security more troubling.
    The passage of the Bioterrorism Act--following September 
11, utilities serving a population of 3003 people were required 
to perform an submit an assessment of the water system's 
vulnerability to terrorist attacks or other attacks which might 
disrupt our drinking water supply. It is the EPA's 
responsibilities as the lead Federal agency charged with 
coordinating critical water infrastructure protection 
activities--to see that water utilities meet the requirements 
set forth by Congress in the Bioterrorism Act, as well as to 
provide them with the necessary tools to do so.
    However, the EPA office of Inspector General has issued 
several reports in the last few years on this very subject 
critiquing the status of security at these very facilities.
    In fact, the report released by the Inspector General last 
September found serious vulnerabilities in the EPA's actions to 
prevent or combat contamination of our water supply as a result 
of terrorism.
    Specifically, EPA failed to provide adequate information 
about terrorist threats, but did provide guidance to water 
utilities on how to protect themselves from vandals. In short, 
the EPA was directing the local water utilities to be on the 
lookout for juvenile delinquents, not al Qaeda or terrorists. 
As a result, water utilities were having problems identifying 
and prioritizing threats to our water supply.
    Given that vulnerability assessments serve as the 
foundation for emergency response plans and for future security 
enhancements, the Inspector General suggested that the EPA 
monitor all water system submissions to insure that 
vulnerability assessments identify and prioritize their 
terrorist threats.
    In other words, EPA needs to make this a priority. We can't 
wait for an incident to happen. We need to take preventive 
action now. I hope the EPA will address the findings of the 
Inspector General today because these vulnerabilities are 
unacceptable.
    With that, Mr. Chairman, I yield back the balance of my 
time.
    [Additional statements submitted for the record follows:]
 Prepared Statement of Hon. Joe Barton, Chairman, Committee on Energy 
                              and Commerce
    Thank you, Chairman Gillmor, for holding this oversight hearing 
today on a very critical issue affecting the health and security of our 
nation. Utilities across the country have long recognized that drinking 
water may be vulnerable to terrorism of various types, including 
physical disruption, bioterrorism, chemical contamination, and cyber 
attacks. I am proud to say that this Committee was the first to act on 
this issue after the attacks on September 11, with the passage of title 
IV of the Bioterrorism Act of 2002. Title IV amended the Safe Drinking 
Water Act to require each community water system serving more than the 
3,300 individuals to conduct a ``vulnerability assessment'' of its 
susceptibility to a terrorist attack or other intentional act intended 
to substantially disrupt the ability of the system to provide safe 
drinking water.
    It is my understanding that the timelines for all of these systems 
to have complied and submit their assessments have now passed. I look 
forward to getting an update on this process. While recognizing our 
drinking water systems' vulnerabilities is an important accomplishment, 
we also need to determine what steps are necessary in adopting 
appropriate security measures that address vulnerabilities and mitigate 
the consequences of any attack.
    I thank the witnesses for their cooperation in attending and I look 
forward to hearing their testimony.
    I yield back, Mr. Chairman.
                                 ______
                                 
    Prepared Statement of Hon. John D. Dingell, a Representative in 
                  Congress from the State of Michigan
    Mr. Chairman, I welcome this oversight hearing to determine the 
effectiveness of the Administration's implementation of the Safe 
Drinking Water Act Amendments that were enacted as part of the Public 
Health Security and Bioterrorism Preparedness and Response Act of 2002.
    These provisions required drinking water utilities to assess the 
vulnerabilities of their distribution systems and water supplies to the 
potential threat of terrorist attacks. Water utilities were required to 
submit these assessments to the Environmental Protection Agency (EPA) 
so the government could ensure that they were properly conducted and 
that the drinking water utilities were taking the necessary actions to 
safeguard the public and protect drinking water supplies from potential 
terrorist threats.
    While I look forward to Mr. Grumbles's testimony today, I am very 
disappointed that the Department of Homeland Security chose to ignore 
the Subcommittee's request to provide a witness. The hearing will also 
lack testimony from the EPA Inspector General's Office. This omission 
is particularly disappointing because the EPA Inspector General has 
issued four separate evaluation reports on EPA's performance and the 
assessments conducted by the water utilities.
    The Inspector General's findings are extremely disturbing, and are 
worthy of this Subcommittee's careful review. For example, on September 
23, 2003, the EPA Inspector General reported:
          ``The Bioterrorism Act requires community water systems to 
        prepare for and assess vulnerability to terrorist and other 
        intentional acts. However, based on our interviews, we believe 
        that vulnerability assessments submitted may emphasize 
        traditional, less consequential, and less costly threats, such 
        as vandalism or disgruntled employees. Therefore, vulnerability 
        assessments may not necessarily address terrorist scenarios or 
        the events of 9/11 that motivated passage of the Bioterrorism 
        Act.''
    The Inspector General evaluation report dated September 11, 2003, 
stated:
          ``EPA's Strategic Plan lacks fundamental components, such as 
        measurable performance results and information and analysis, to 
        ensure the greatest practicable reductions in risks to the 
        critical water sector infrastructure.''
    If the vulnerability assessments are not addressing terrorist 
scenarios, and if EPA cannot demonstrate the risk reduction and 
security enhancements that have been achieved by water utilities, then 
the public interest is not being served.
    I also note that while Congress has provided the Administration 
with the tools to assure and enhance security for water utilities, 
airlines, ports, and nuclear facilities, nothing has been done for 
chemical plants--one of our most vulnerable infrastructures that in the 
event of a terrorist attack could result in catastrophic loss of life. 
I urge the Committee to give this matter its full attention.

    Mr. Gillmor. The gentleman yields back. The Chair will 
recognize himself for some questions, after our witnesses 
testify.
    Mr. Grumbles.

      STATEMENT OF BENJAMIN H. GRUMBLES, ACTING ASSISTANT 
 ADMINISTRATOR FOR WATER, U.S. ENVIRONMENTAL PROTECTION AGENCY

    Mr. Grumbles. Thank you, Mr. Chairman, and Congresswoman 
Solis, and members of the subcommittee. I am Ben Grumbles with 
the office of water EPA. I am here to talk a little bit about 
the progress we have made in the Bioterrorism Act of 2002, the 
partnerships that have allowed progress to be made and also our 
priorities and the challenges we face--and Mr. Chairman, I 
would be remiss if I did not acknowledge, since I know 
personally firsthand the role of this subcommittee and this 
committee in crafting the bipartisan legislation, the 
Bioterrorism Act of 2002 and moving forward with it.
    And I can say that the administration is very proud of the 
legislation and the success we have had to date in implementing 
it.
    I can also say--that while I will talk about some of the 
statistics in terms of the vulnerability assessments and the 
emergency response plans--that I agree full well with the 
spirit and the tone of some of the statements that assessments 
and plans by themselves do not make systems safer.
    However, I can also say with confidence that--on the water 
security front--we are smarter and safer as a country than we 
were 3 years ago.
    And a lot of that is due to the legislation and also, quite 
frankly, the aggressive efforts of the EPA and the 
administration to implement the legislation and to do things 
outside of the legislation.
    And perhaps most importantly, it has been the commitment 
and the efforts of the utilities, the local officials, the 
State drinking water agencies and others, some of the folks are 
in the room behind me, to really move forward in terms of the 
Bioterrorism Act.
    Well, what I would like to do is to focus on a couple of 
the aspects, Title IV of the Bioterrorism Act that you all were 
instrumental in drafting and enacting and overseeing.
    First of all, we have some excellent numbers to report on 
the vulnerability assessments. The first number is 100 percent. 
That is the number that reflects the compliance rate of the 
large drinking water systems throughout the country. They have 
all submitted their vulnerability assessments to EPA.
    The other number I would like to mention is 98 percent. 
That is the number of medium-sized community water systems that 
have submitted their vulnerability assessments. 89 percent. 
That is the number of emergency response plan certifications 
that have been submitted by the medium-sized communities.
    The last number is 88 percent, and that is the number of 
small systems--those between 3,300 population and 50,000 in 
population--that have submitted their vulnerability 
assessments.
    And, Mr. Chairman, what these numbers mean is that the 
country is listening, the utilities throughout the country 
using our guidance and following the law have submitted their 
vulnerability assessments. There is a much greater awareness, 
and they have also largely submitted all of their 
certifications with respect to the emergency response plans. I 
would also like to say that we have partnered with the domestic 
preparedness office of the Department of Homeland Security to 
offer workshops to train drinking water utilities on emergency 
response planning.
    What are some of the priorities and activities that we are 
focusing on? One of them, which is critically important, is to 
move beyond just the identifying risks, doing vulnerability 
assessments and preparing emergency response plans. A high 
priority of the agency is to provide the tools, the training, 
the technical assistance to actually implement those plans. 
That means taking measures of prevention, hardening facilities, 
taking various steps to insure that the drinking water systems 
throughout the country are truly safer and more secure.
    I think it is critically important that water utilities 
stay up to date on the threat information. The agency has been 
providing threat information, our baseline threats documents or 
guidance to utilities on preparing their vulnerability 
assessments are actions that we take pride in and recognize can 
help our partners do the important job they need to do.
    I just want to mention a couple other items, Mr. Chairman, 
that are significantly important. One of those is that the 
Agency is working on implementation of Presidential Directive 
9. It is the homeland security Presidential Directive number 9 
that was issued in January 2004.
    That is a comprehensive and ambitious directive to us to 
improve and increase the monitoring and surveillance of the 
Nation's drinking water systems. Monitoring is critically 
important and we are putting a high priority on working with 
our partners and our other members of the Federal family, 
certainly the Department of Homeland Security to follow through 
on the President's directive.
    The other thing I wanted to mention is an excellent example 
of the partnerships that are critically important to the 
success of water security, and that is we are working with the 
American Society of Civil Engineers to develop physical 
security guidelines that utilities should consider in 
designing, managing and operating their systems.
    Mr. Chairman, there are over 2 million miles of pipe in the 
country with respect to drinking water facilities. What that 
tells all of us is that one of the priority areas in 
implementing your legislation, our legislation, is to focus in 
on the distribution systems, that is a primary focus, and we 
will certainly continue to do that through our research plan, 
through our actions and through coordinating our responses 
under the Presidential directives.
    The last thing I want to mention, Mr. Chairman, are of the 
challenges and opportunities. Several of your colleagues have 
mentioned some of the key issues, and I would like to reiterate 
them.
    One of the challenges is to recognize that the 
vulnerability assessments should be living documents. The 
visions, the great legislation of the 2002 Bioterrorism Act 
essentially left it that those were one-time assessments. I 
think what we have learned in our coordinations with other 
partners with GAO, with the Inspector General, is that there 
would be great value if those documents were living documents 
and would be revisited and revised and updated and adapted, 
modernized. So that is a very important thing to keep in mind.
    The other one, the final one, Mr. Chairman, is the 
vulnerability assessments themselves. We think it is very 
important for you and your colleagues to keep in mind the 
delicate balance of insuring the security of those assessments, 
certainly as it relates to site specific information. Again, 
what the Inspector General told us and what we very much 
appreciate hearing--and what GAO and others tell us is that--
there can be value to aggregate data based in general on the 
vulnerability assessments that can help shed information and 
light on our research plans, our priorities. That is another 
thing for the committee to keep in mind.
    Mr. Chairman, I thank you and your colleagues for your 
patience, and we look forward to answering any of your 
questions.
    [The prepared statement of Benjamin H. Grumbles follows:]
     Prepared Statement of Benjamin H. Grumbles, Acting Assistant 
     Administrator for Water, U.S. Environmental Protection Agency

                              INTRODUCTION
    Good afternoon Chairman Gillmor and Members of the Committee. I am 
Benjamin H. Grumbles, Acting Assistant Administrator for Water at the 
United States Environmental Protection Agency. I welcome this 
opportunity to speak to you today about our progress to date in water 
security, our vision for the future, and the challenges we face in 
enhancing the security of the Nation's water infrastructure.
    Promoting the security of the Nation's water infrastructure is one 
of the most significant undertakings and responsibilities of the Agency 
in a post-September 11 world. An attack, or even a credible threat of 
an attack, on water infrastructure could seriously jeopardize the 
public health and economic vitality of a community. As you know, 
drinking water and wastewater utilities can be vulnerable to a variety 
of attacks, including, for example, physical destruction of critical 
water system components, release of hazardous chemicals, intrusion into 
cyber systems, and intentional contamination of drinking water.
    Over the past three years, EPA has worked diligently to support the 
water sector in improving water security and the sector has taken their 
charge seriously. Through Congressional authorization under the Public 
Health Security and Bioterrorism Preparedness and Response Act of 2002 
(the Bioterrorism Act), and through Presidential mandates under 
Homeland Security Presidential Directives 7, 9 and 10, EPA has been 
entrusted with important responsibilities for coordinating the 
protection of the water sector.
    We have good news to report on our progress to date. However, much 
work remains to be done. Understanding one's vulnerability is only the 
first step in what is a multi-step process to improving security. Many 
water systems that have completed their vulnerability assessments are 
now saying, ``we have identified our weaknesses, now what do we do?'' 
The next steps involve adopting security measures that both address 
vulnerabilities and mitigate the consequences of an attack.
    EPA's water security work has focused on helping utilities assess 
their vulnerabilities and creating a baseline of security-related 
information. Existing and future efforts include providing tools and 
assistance that drinking water and wastewater systems need to address 
vulnerabilities by identifying up-to-date security enhancements, 
sharing information on threats and contaminants, and training on 
emergency response.
    Our goal is to provide the water sector and related emergency 
response, law enforcement, and public health officials with the tools, 
training, and information they need to prevent, prepare, and respond to 
terrorist threats. EPA also needs to continue to provide programs that 
forge critical links between the water sector and those who support or 
could support the sector in detecting and responding to threats and 
incidents, such as local law enforcement and public health departments.
    Indeed partnerships are absolutely a key factor in our success. The 
water sector includes approximately 54,000 community drinking water 
systems and 16,000 publicly owned wastewater treatment works 
nationwide. Reaching the entire water sector requires strong 
partnerships among EPA, state water and homeland security officials, 
and technical assistance providers. Our work also demands extensive 
coordination and communication among federal agencies including the 
Department of Homeland Security, the Department of Health and Human 
Services, the Department of Defense and the intelligence community, 
among others.
    As a result of the partnerships we have developed and EPA's long-
standing relationship with the water sector, we have fulfilled the 
requirements of the Bioterrorism Act of 2002 and made headway on 
several other fronts, as well.
    implementation of title iv b drinking water security and safety
Required Vulnerability Assessments and Emergency Response Plans
    Under the Act, each community water system (CWS) providing drinking 
water to more than 3,300 persons must conduct a vulnerability 
assessment, certify its completion, and submit a copy of the assessment 
to EPA according to a specified schedule. In addition, each system must 
prepare or revise an emergency response plan that incorporates the 
findings of the vulnerability assessments and certify to EPA within six 
months of completing a vulnerability assessment that the system has 
completed such a plan.
    Using FY 2002 supplemental appropriation funds, EPA provided grants 
to support the development of vulnerability assessments and emergency 
response plans. EPA issued $51 million in direct grants to 399 of the 
largest community water utilities that serve populations greater than 
100,000 people. Working with training organizations and State drinking 
water administrators, EPA provided $20 million in grants to provide 
technical assistance to small and medium community water systems.
    EPA has received all of the vulnerability assessments and emergency 
response plan certifications from the Nation's largest community water 
systems. To date, we have received vulnerability assessments from 98% 
of the medium-sized community water systems that were due December 31, 
2003, and 89% of their emergency response plan certifications. The 
smallest community water systems covered by the Act were required to 
submit their vulnerability assessments to us by June 30, 2004. We have 
received over 7,000 vulnerability assessments from this group, 
amounting to an 88% submission rate. What these numbers mean is that 
water systems serving collectively over 230 million people have 
completed vulnerability assessments: a remarkable achievement in so 
short a time. Despite this success, EPA continues to work to ensure 
that we receive all vulnerability assessments and emergency response 
plan certifications so that all of the Nation's community water systems 
serving more than 3,300 people reach the same critical milestone.
    Of course, most of the credit should go to those who actually 
prepared the vulnerability assessments and emergency response plans: 
the water systems themselves. Without their commitment to enhancing 
security for their consumers, we would not have seen such a high 
response rate.
Information on Baseline Threats and Protection Protocols
    The Bioterrorism Act also required EPA to develop and provide 
baseline threat information to community water systems in order to aid 
them in performing vulnerability assessments. EPA developed the 
Baseline Threat Information for Vulnerability Assessments of Community 
Water Systems (Baseline Threat Document) in consultation with many 
stakeholders, including other federal agencies, state and local 
governments, water industry associations, and technical experts. The 
Baseline Threat Document provides utilities with information to (1) 
undertake risk-based vulnerability assessments of their assets, (2) 
analyze potential threats, and (3) consider the consequences of a 
variety of modes of attack. The document, whose distribution is limited 
largely to community water systems, lists vulnerability assessment 
tools and other information resources to help water systems learn more 
about the potential threats in their areas.
    To further assist community water systems in completing their 
vulnerability assessments and emergency response plans, in January 
2003, EPA released a document titled, Instructions to Assist Community 
Water Systems in Complying with the Public Health Security and 
Bioterrorism Preparedness and Response Act of 2002. An addendum to the 
instructions was released in October 2003. The instructions outline the 
steps that water utilities should take to transmit their vulnerability 
assessments and certifications to EPA. The instructions and a 
supporting fact sheet also outline the six key elements and all 
components of the system, as specified in the Act that must be 
considered in the vulnerability assessment.
    Besides the commitment of the utilities and Congressional support 
for funding, we attribute the success in meeting the requirements of 
the Act to several factors. First, to aid the development of 
vulnerability assessments and emergency response plans, EPA supported 
the creation of analytical tools, training, and technical assistance 
for the range of sizes of drinking water systems. Vulnerability 
assessment tools include the Risk Assessment Methodology for Water, 
which has since been adapted for small and medium drinking water 
utilities; the CD-ROM software Vulnerability Self-Assessment Tool for 
drinking water and wastewater systems; and Security and Emergency 
Management System for small drinking water systems.
    Second, working with our many partners, EPA-sponsored training and 
workshops in 2002 and 2003 which reached several thousand community 
drinking water and wastewater utility officials, training providers, 
and utility contractors. These efforts have trained drinking water and 
waste water systems that serve most of the U.S. population.
    To aid the development of emergency response plans, as required by 
the Act, EPA developed guidance outlining the elements of a sound plan 
followed by a toolbox entitled the Response Protocol Toolbox: Planning 
and Responding to Contamination Threats to Drinking Water Systems, 
which is designed to help utilities prepare for and respond to 
intentional contamination threats and incidents.
    Over the past year, EPA has partnered with DHS's Office of Domestic 
Preparedness to offer a series of workshops to train drinking water 
utilities on emergency response planning. A series of two-day workshops 
feature a tabletop exercise of an intentional contamination event in a 
public water supply. The goal of the exercise is to bring 
representatives of the key response agencies (e.g., FBI, local and 
state police, emergency responders, state regulatory agencies, state 
and local health departments) together to apply the guidance provided 
during the first day of training.
    While EPA has worked to ensure that community water systems fulfill 
their obligations under the Bioterrorism Act, the Agency has not 
ignored wastewater systems or small community drinking water systems 
(serving 3,300 and fewer), which are not subject to specific provisions 
of the Bioterrorism Act requiring the completion of vulnerability 
assessments and emergency response plans. EPA also has provided 
guidance and training to these utilities on how to conduct 
vulnerability assessments, prepare emergency response plans, and 
address threats from terrorist attacks.
Research
    The Act also places a premium on ensuring that research is carried 
out to support security efforts. Section 1434 of the Act stipulates 
that EPA shall work collaboratively to review methods to prevent, 
detect, and respond to the intentional contamination of water systems, 
including a review of equipment, early warning notification systems, 
awareness programs, distribution systems, treatment technologies and 
biomedical research. Section 1435 requires the review of methods by 
which the water system and all its parts could be intentionally 
disrupted or rendered ineffective or unsafe, including methods to 
interrupt the physical infrastructure, the computer infrastructure, and 
the treatment process.
    To meet EPA's mandate under these sections, the Office of Water 
partnered with the newly established National Homeland Security 
Research Center in EPA's Office of Research and Development to draft 
the Water Security Research and Technical Support Action Plan. The 
Action Plan, released in March 2004, addresses each of the research 
requirements under the Bioterrorism Act. It describes the research and 
technologies needed to better address drinking water supply, water 
treatment, finished water storage, and drinking water distribution 
system vulnerabilities. It also addresses water security research needs 
for wastewater treatment and collection infrastructure, which includes 
sanitary and storm sewers or combined sanitary-storm sewer systems, 
wastewater treatment, and treated wastewater discharges. EPA is 
implementing activities described in the plan, which was vetted with 
water stakeholders and reviewed by the National Academy of Science.

         FULFILLING OUR GOAL: ACTIVITIES, PLANS AND CHALLENGES
    As I mentioned earlier, our goal is to provide the water sector the 
tools, training, and information they need to comprehensively address 
water security. With utilities and our other partners, we are aiming to 
minimize the opportunity for terrorist attack on drinking water or 
wastewater systems by identifying and reducing potential risks and to 
maximize our ability to detect and respond to terrorist attacks. Let me 
give you some examples of the activities we have underway and 
challenges we face to support this goal.
Identifying Risk
    In addition to undertaking vulnerability assessments, it is vital 
that water utilities stay up-to-date on threat information in order to 
fully understand their potential risk. Funded in large part by EPA, the 
Water Information Sharing and Analysis Center, known as the WaterISAC, 
became operational in December 2002. It was developed to provide 
drinking water and wastewater systems with a highly secure Web-based 
environment for early warning of potential physical, contamination, and 
cyber threats and for information about security. The 311 utilities 
that currently subscribe to the WaterISAC provide drinking water to 60 
percent of the U.S. population. Forty-five State drinking water primacy 
agencies are members of the WaterISAC, which provides a mechanism to 
reach the majority of small and medium drinking water systems. Key EPA 
staff also have access.
    Efforts are underway to expand membership in the WaterISAC and to 
develop the ancillary Water Security Channel (WaterSC) that will allow 
the WaterISAC to send e-mail alerts on security issues and share basic 
security information directly with a much larger group of drinking 
water and wastewater systems.
    Recently, the Department of Homeland Security announced plans to 
expand its secure, computer-based counter-terrorism network to the 
critical infrastructures, working first with the water and electricity 
sectors. The National Homeland Security Information Network (HSIN) 
reaches state homeland security offices, emergency operations centers 
around the country, and has a significant law enforcement 
communications component. EPA is working with the appropriate 
organizations to determine how the WaterISAC and HSIN can best serve 
water sector utilities.
    In addition, EPA works with the Department of Homeland Security and 
the broader intelligence community to improve threat information 
relevant to water utilities. This involves training intelligence 
officers on the vulnerabilities of water utilities and providing secure 
mechanisms, such as the WaterISAC, to communicate sensitive information 
to the utilities.
Reducing Risk
    Early warning mechanisms can significantly reduce the risk of 
public health impacts and community service disruptions. Issued in 
January 2004, Homeland Security Presidential Directive (HSPD 9) 
outlines EPA's responsibilities to develop a robust, comprehensive 
surveillance and monitoring program to provide early warning in the 
event of a terrorist attack using biological, chemical, or radiological 
contaminants. HSPD 9 also directs EPA to develop a nationwide 
laboratory network to support the routine monitoring and response 
requirements of the surveillance program.
    EPA worked closely with water utilities, state officials and other 
federal agencies, for example the Department of Health and Human 
Services, the Department of Homeland Security and the Department of 
Defense, to formulate the conceptual framework for building such a 
surveillance and laboratory capability. Specific activities supporting 
this analysis included: 1) development of a standardized field 
screening and sampling kit; 2) identification of the highest priority 
contaminant threats and the most vulnerable infrastructure points 
through an inter-agency workgroup, 3) evaluation of new and emerging 
detection technologies; and 4) collaboration with the Centers for 
Disease Control and Prevention (CDC) to develop an alliance of drinking 
water laboratories with CDC's Laboratory Response Network.
    In recognition that a robust detection program is only one part of 
an effective security strategy, EPA developed a variety of policies, 
procedures, physical enhancements, and best practices that assist water 
utilities in preventing attacks and protecting critical infrastructure 
components. For example, EPA's Security Product Guides provide 
information on a variety of products available to enhance physical 
security (including monitoring equipment) and electronic or cyber 
security. Several products will assist utilities in preventing or 
delaying potential adversaries as well as detecting incidents. In 
addition, EPA has worked with the American Society of Civil Engineers 
to develop physical security guidelines that utilities should consider 
in designing, managing, and operating their systems.
    Implementing security enhancements can prove to be a challenge for 
many water-sector utilities who also face competing demands for 
replacement of aging infrastructure and making process improvements to 
meet public health requirements. EPA and water-sector stakeholders need 
to continue educating elected officials, water boards, rate-setting 
entities, and consumers about the importance and need for security 
enhancements at drinking water and wastewater utilities and the 
multiple benefits that can be derived from these enhancements. EPA has 
provided guidance on how the Drinking Water State Revolving Fund and 
the Clean Water State Revolving Fund may be used to lend financial 
support for such improvements.
Preparing to Respond
    Due to the dispersed nature of water utilities B the Nation's 
drinking water utilities have about 2 million miles of pipe B it is a 
great challenge to protect against determined aggressors. Consequently, 
it is critically important that water utilities be prepared to respond 
effectively at any time. Building on workshops already given in FY 2003 
and FY2004, EPA will continue to stress the importance of emergency 
response planning, drills and exercises for water utilities and 
associated emergency response, law enforcement and public health 
officials.
    Several Homeland Security Presidential Directives (HSPDs) issued 
within the year also relate to emergency response. For example, HSPD 8 
(December, 2003) establishes policies to strengthen the Nation's 
preparedness to prevent and respond to threatened or actual domestic 
terrorist attacks, major disasters, and other emergencies by 
establishing mechanisms for improved delivery of federal preparedness 
assistance to state and local governments. Also, HSPD 10: Biodefense 
for the 21st Century (April, 2004), which is currently a classified 
document, reaffirms EPA's responsibilities under HSPD 9 while adding a 
clear directive on the Agency's responsibilities in decontamination 
efforts. It provides direction to further strengthen the Biodefense 
Program through threat awareness, prevention and protection, 
surveillance and detection, and response and recovery.

                      CHALLENGES AND OPPORTUNITIES
    While progress has been made toward securing drinking water and 
wastewater utilities, a number of challenges and opportunities remain, 
and EPA is taking steps to meet them both from national and local 
perspectives .
    EPA was designated as the Sector Specific Agency responsible for 
infrastructure protection activities for the nation's drinking water 
and wastewater systems under HSPD 7, entitled Critical Infrastructure 
Identification, Prioritization, and Protection (December, 2003). As 
such, EPA is responsible for: 1) identifying, prioritizing, and 
coordinating infrastructure protection activities for the nation's 
drinking water and wastewater treatment systems; 2) working with 
federal departments and agencies, state and local governments, and the 
private sector to facilitate vulnerability assessments; 3) encouraging 
the development of risk management strategies to protect against and 
mitigate the effects of potential attacks on critical resources; and 4) 
developing mechanisms for information sharing and analysis. As I have 
explained, work is underway to fulfill many of these responsibilities.
    To portray a comprehensive picture of security activities for the 
water sector, under HSPD 7, EPA is leading the development of a water 
sector specific plan as part of the DHS-led National Infrastructure 
Protection Plan production process.
    In developing the plan, we identified some additional issues for 
ensuring that water utilities implement effective security programs. 
For example, updates of drinking water utilities' vulnerability 
assessments and emergency response plans, or the implementation of 
security enhancements identified by the vulnerability assessment, are 
not required. The water sector recognizes the need for both 
vulnerability assessments and emergency response plans to be living 
documents, revised periodically to ensure their applicability. 
Furthermore, sector representatives have expressed to the Agency the 
need for clear expectations of what constitutes effective security 
programs so that they can justify and obtain the resources needed to 
improve security.
    To address this challenge, the Agency asked the National Drinking 
Water Advisory Council (NDWAC), a formal advisory committee to the 
Agency, to consider establishing a Water Security Working Group to (1) 
characterize effective voluntary utility security programs for drinking 
water and wastewater utilities, (2) consider ways to provide 
recognition and incentives that facilitate adoption of such programs, 
and (3) recommend mechanisms to measure the extent of implementation. 
The NDWAC agreed and the resultant Working Group is made up of sixteen 
members chosen on the basis of experience, geographic location, and 
their unique drinking water, wastewater, and/or security perspectives. 
During the first meeting of the workgroup, it was clear that the 
Working Group will consider the need for an iterative approach whereby 
utilities periodically revisit both vulnerability assessments and 
emergency response plans.
    Another issue that we identified relates to EPA's ability to share 
the information contained in or derived from vulnerability assessments 
that are required by the Act to be submitted to the Agency by Community 
Water Systems. Currently, consistent with the protective provisions of 
the Bioterrorism Act, EPA must designate individuals before sharing 
assessment information with them. Clearly, it is extremely important to 
protect the site-specific vulnerability information contained in these 
vulnerability assessments and the Agency guards this information 
fiercely. Aggregated information on vulnerabilities of the sector, 
however, could be helpful in identifying priorities for security 
improvements and research. Both the Government Accountability Office 
and EPA's Inspector General have pointed out the need for this 
information to guide our efforts at the federal level.

                               CONCLUSION
    EPA has developed a water security program that meets our critical 
responsibilities as expressed in Homeland Security Presidential 
Directive 7, which assigns to EPA a pivotal role in coordinating and 
facilitating the protection of the Nation's drinking water and 
wastewater systems. EPA has produced a broad array of tools and 
assistance that the water sector is using to assess its vulnerabilities 
and to develop emergency response plans. As a result of our efforts, 
drinking water systems collectively serving over 230 million people 
have submitted vulnerability assessments. We have worked effectively 
with our partners within the sector and also reached out to build new 
relationships with important partners beyond the sector to ensure that 
water and wastewater utilities receive the information and support they 
need to reduce risk and consequences of an attack.
    Thank you for the opportunity to describe our accomplishments, new 
mandates and program needs, challenges, and vision for the future of 
water infrastructure security. Looking forward, we will continue to 
work closely with Congress, our water sector partners, federal agencies 
and various stakeholders to ensure that citizens across the country are 
confident in the security of their water and wastewater utilities. I 
will be happy to answer any questions you may have.

    Mr. Gillmor. Thank you very much, Mr. Grumbles.
    Mr. Stephenson.

 STATEMENT OF JOHN B. STEPHENSON, DIRECTOR, NATURAL RESOURCES 
       AND ENVIRONMENT, GOVERNMENT ACCOUNTABILITY OFFICE

    Mr. Stephenson. Thank you, Mr. Chairman, members of the 
subcommittee.
    Drinking water utilities have long been recognized as 
potentially vulnerable to terrorist attacks of various types, 
including physical disruption, bioterrorism, chemical 
contamination and cyber attack. Terrorists could disrupt not 
only the availability of safe drinking water, but also the 
delivery of vital services that depend on these water supplies, 
such as fire suppression. Such concerns were greatly amplified 
by the September 11 attacks on the World Trade Center and the 
Pentagon--and then by the discovery of training manuals in 
Afghanistan, detailing how terrorist trainees could support 
attacks on drinking water systems.
    Congress, as you know, has committed over $140 million in 
fiscal years 2002 through 2004 to help systems assess their 
vulnerability to terrorist threats and to develop response 
plans.
    My testimony today is based on a report that we did last 
year on how best to use these funds. To develop this report, we 
examined the key security-related vulnerabilities affecting the 
Nation's drinking water systems; how Federal funds could best 
be used; and, specific activities that the Federal Government 
should support to improve drinking water security.
    To address these issue, we assembled a panel of 43 
nationally recognized experts and in selecting these experts we 
sought individuals who were widely recognized as possessing 
expertise on one or more key aspects of drinking water 
security. We also sought to achieve a balance in representation 
from key Federal agencies, key State and local agencies, 
industry and nonprofit organizations and water utilities of 
various sizes. Here is what our experts said.
    Nearly 75 percent of the experts identified the 
distribution system as the most vulnerable of all system 
components with source water supplies, critical information or 
data systems and chemicals stored onsite as the next most 
important vulnerability. A typical drinking water system with a 
supply source water facility and distribution system--the 
distribution system was cited as the greatest vulnerability 
because it is easily accessible at so many points, such as a 
fire hydrant or a standpipe within a building.
    In fact, the water is post treatment, meaning that a 
chemical, biological or radiological agent would be virtually 
undetectable until it was too late to prevent harm.
    The experts also identified a lack of redundancy in 
biosystems and a lack of information on the most serious 
threats as overarching vulnerabilities.
    In responding to our questions about how Federal funds 
could best be used, about 90 percent of our experts said that 
allocation decisions should be based on the vulnerabilities 
assessments prepared under Bioterrorism Act.
    In addition, the experts gave the highest funding priority 
to utilities serving high density populations followed closely 
by utilities serving critical assets such as military bases or 
other sensitive government utilities.
    When asked to identify the most effective mechanisms for 
distributing these Federal funds--over half the experts favored 
direct Federal grants--but many favored a Federal requirement 
for matching funds pass a grant condition.
    Fewer experts recommended that using the drinking water 
State resolving fund, cautioning that it would not be as 
effective for making near-term security upgrades, and that it 
might dilute the fund's original purpose of infrastructure 
upgrade.
    Finally, when we ask our experts to identify and set 
priorities for security-enhancing activity, most deserving of 
Federal support, their responses fell into three categories. 
The first was physical, and physical improvements including the 
development of real-time monitoring technologies, increasing 
laboratory capacity and physical hardening.
    The second was education and training to be provided to 
both utility and nonutility personnel responsible for 
preventing, responding to and recovering from an attack.
    And three, strengthened operational relationships, 
especially between water utilities and other agencies such as 
public health, enforcement agencies, and neighborhood utilities 
that may have a key role in emergency response.
    In conclusion, we recommended that EPA consider the 
information in this report as it determines how best to 
allocate security-related Federal funds among drinking water 
utilities, which method should be used to distribute the funds 
and what specific activities should be supported. EPA agreed to 
do so. As it moves forward with the drinking water security 
program, we think it is doing so.
    Mr. Chairman, that concludes the summary of my statement 
and I will take questions.
    [The prepared statement of John B. Stephenson follows:]
 Prepared Statement of John B. Stephenson, Director, Natural resources 
         and Environment, U.S. Government Accountability Office
    Mr. Chairman and Members of the Subcommittee: Drinking water 
utilities across the country have long been recognized as potentially 
vulnerable to terrorist attacks of various types, including physical 
disruption, bioterrorism, chemical contamination, and cyber attack. 
Damage or destruction by terrorists could disrupt not only the 
availability of safe drinking water, but also the delivery of vital 
services that depend on these water supplies, such as fire suppression. 
Such concerns were greatly amplified by the September 11, 2001, attacks 
on the World Trade Center and the Pentagon and then by the discovery of 
training manuals in Afghanistan detailing how terrorist trainees could 
support attacks on drinking water systems.
    Congress has since committed significant federal funding to assist 
drinking water utilities--with over $140 million appropriated from 
fiscal year 2002 through fiscal year 2004--to help systems assess their 
vulnerabilities to terrorist threats and develop response plans. As 
significant as these funds are, drinking water utilities are asking the 
federal government to support efforts that go beyond the planning for 
upgrading drinking water security to the actual implementation of 
security upgrades. Consequently, at the request of the Senate Committee 
on Environment and Public Works, we examined (1) the key security-
related vulnerabilities affecting the nation's drinking water systems; 
(2) the criteria that experts believe should be used to determine how 
federal funds are allocated among recipients to improve their security, 
and the methods that should be used to distribute these funds; and (3) 
specific activities that experts believe the federal government should 
support to improve drinking water security. My testimony is based on 
our October 2003 report entitled, Drinking Water: Experts' Views on How 
Future Federal Funding Can Best Be Spent to Improve Security.
    To prepare our October 2003 report on these issues, we assembled a 
panel of nationally recognized experts. In selecting members for the 
expert panel, we sought individuals who were widely recognized as 
possessing expertise on one or more key aspects of drinking water 
security. We also sought to achieve balance in representation from key 
federal agencies, key state or local agencies, key industry and 
nonprofit organizations, and water utilities of varying sizes.
    In summary:

 Our expert panel identified several key physical assets as the most 
        seriously vulnerable to terrorist attacks. Nearly 75 percent of 
        the experts (32 of 43) identified one or more components of the 
        distribution system. In fact, more experts identified the 
        distribution system as the single most important vulnerability 
        (12 of 43) of all system components. The other physical assets 
        most frequently cited were source water supplies, critical 
        information systems, and chemicals that are stored on site for 
        use in the treatment process. Importantly, the experts also 
        identified overarching vulnerability issues that may involve 
        multiple system components, or even an entire drinking water 
        system. Chief among these issues were (1) a lack of redundancy 
        in vital systems, which increases the likelihood that an attack 
        could render a system inoperable; and (2) the difficulty many 
        systems face due to a lack of information on the most serious 
        threats to which they are exposed. In general, the panelists' 
        observations were similar to those of major public and private 
        organizations that have assessed the vulnerability of these 
        systems to terrorist attacks, including the National Academy of 
        Sciences, Sandia National Laboratories, and key industry 
        associations.
 About 90 percent of the experts agreed ``strongly'' or ``somewhat'' 
        that allocation decisions should be based on assessments of 
        drinking water utilities' vulnerabilities, which the utilities 
        are required to prepare by the Public Health Security and 
        Bioterrorism Preparedness and Response Act of 2002. In 
        addition, the experts favored funding priority for utilities 
        serving high-density populations, with over 90 percent 
        indicating that they deserve at least a ``high'' priority and 
        over 50 percent indicating they deserve ``highest'' priority. 
        Utilities serving critical assets (such as military bases and 
        other sensitive government facilities, national icons, and key 
        cultural or academic institutions) were also recommended as 
        high-priority recipients. When asked to identify the most 
        effective mechanisms for distributing these federal funds to 
        recipients, over half the experts indicated that direct federal 
        grants would be ``very effective'' in doing so. Many also 
        favored including a requirement for matching funds as a grant 
        condition. Fewer experts recommended using the Drinking Water 
        State Revolving Fund (DWSRF) for this purpose, particularly to 
        support upgrades that need to be implemented quickly.
 When asked to identify and set priorities for security-enhancing 
        activities most deserving of federal support, the experts most 
        frequently identified activities that fell into three broad 
        categories:
     Physical and technological improvements--needed for both physical 
            alterations to improve the security of drinking water 
            systems, and for the development of technologies to 
            prevent, detect, or respond to an attack. The need to 
            develop near real-time monitoring technologies, which would 
            be particularly useful in quickly detecting contaminants in 
            water that has already left the treatment plant for the 
            consumer, had by far the strongest support.
     Education and training--to be provided to both utility and 
            nonutility personnel responsible for preventing, responding 
            to, and recovering from an attack. These activities 
            include, among other things, support for simulation 
            exercises to provide responders with experience in carrying 
            out utilities' emergency response plans; specialized 
            training of utility personnel responsible for security; 
            general training of utility personnel to augment security 
            awareness among all staff; and multidisciplinary consulting 
            teams to independently analyze utilities' security 
            preparedness and recommend security-related improvements.
     Strengthened operational relationships--especially between water 
            utilities and other agencies (public health agencies, 
            enforcement agencies, and neighboring utilities, among 
            others) that may have key roles in an emergency response. 
            This category also includes developing common protocols to 
            engender a consistent approach among utilities in detecting 
            and diagnosing threats, and the testing of local emergency 
            response systems to ensure that participating agencies 
            coordinate their actions effectively.

                               BACKGROUND
    Drinking water systems vary by size and other factors, but as 
illustrated in figure 1, they most typically include a supply source, 
treatment facility, and distribution system. A water system's supply 
source may be a reservoir, aquifer, or well, or a combination of these 
sources. Some systems may also include a dam to help maintain a stable 
water level, and aqueducts and transmission pipelines to deliver the 
water to a distant treatment plant. The treatment process generally 
uses filtration, sedimentation, and other processes to remove 
impurities and harmful agents, and disinfection processes such as 
chlorination to eliminate biological contaminants. Chemicals used in 
these processes, most notably chlorine, are often stored on site at the 
treatment plant. Distribution systems comprise water towers, piping 
grids, pumps, and other components to deliver treated water from 
treatment systems to consumers. Particularly among larger utilities, 
distribution systems may contain thousands of miles of pipes and 
numerous access points.
    Nationwide, there are more than 160,000 public water systems that 
individually serve from as few as 25 people to 1 million people or 
more. As figure 2 illustrates, nearly 133,000 of these water systems 
serve 500 or fewer people. Only 466 systems serve more than 100,000 
people each, but these systems, located primarily in urban areas, 
account for early half of the total population served.
    Until the 1990s, emergency planning at drinking water utilities 
generally focused on responding to natural disasters and, in some 
cases, domestic threats such as vandalism. In the 1990s, however, both 
government and industry officials broadened the process to account for 
terrorist threats. Among the most significant actions taken was the 
issuance in 1998 of Presidential Decision Directive 63 to protect the 
nation's critical infrastructure against criminal and terrorist 
attacks. The directive designated the Environmental Protection Agency 
(EPA) as the lead federal agency to address the water infrastructure 
and to work with both public and private organizations to develop 
emergency preparedness strategies. EPA, in turn, appointed the 
Association of Metropolitan Water Agencies to coordinate the water 
industry's role in emergency preparedness. During this time, this 
public-private partnership focused primarily on cyber security threats 
for the several hundred community water systems that each served over 
100,000 persons. The partnership was broadened in 2001 to include both 
the drinking water and wastewater sectors, and focused on systems 
serving more than 3,300 people.
    Efforts to better protect drinking water infrastructure were 
accelerated dramatically after the September 11 attacks. EPA and the 
drinking water industry launched efforts to share information on 
terrorist threats and response strategies. They also undertook 
initiatives to develop guidance and training programs to assist 
utilities in identifying their systems' vulnerabilities. As a major 
step in this regard, EPA supported the development, by American Water 
Works Association Research Foundation and Sandia National Laboratories, 
of a vulnerability assessment methodology for larger drinking water 
utilities. The push for vulnerability assessments was then augmented by 
the Public Health Security and Bioterrorism Preparedness and Response 
Act of 2002 (Bioterrorism Act). Among other things, the act required 
each community water system serving more than 3,300 individuals to 
conduct a detailed vulnerability assessment by specified dates in 2003 
or 2004, depending on their size.
    Since we issued our report in October, several Homeland Security 
Presidential Directives (HSPDs) were issued that denote new 
responsibilities for EPA and the water sector. HSPD 7 designates EPA as 
the water sector's agency specifically responsible for infrastructure 
protection activities, including developing a specific water sector 
plan for the National Infrastructure Protection Plan that the 
Department of Homeland Security must produce. HSPD 9 directs EPA to 
develop a surveillance and monitoring program to provide early warning 
in the event of a terrorist attack using diseases, pests, or poisonous 
agents. EPA is also charged, under HSPD 9, with developing a nationwide 
laboratory network to support the routine monitoring and response 
requirements of the surveillance program. HSPD 10 assigns additional 
responsibilities to EPA for decontamination efforts.
    To obtain information for our analysis, we conducted a three-phase, 
Web-based survey of 43 experts on drinking water security. In 
identifying these experts, we sought to achieve balance in terms of 
area of expertise (i.e., state and local emergency response, 
engineering, epidemiology, public policy, security and defense, 
drinking water treatment, risk assessment and modeling, law 
enforcement, water infrastructure, resource economics, bioterrorism, 
public health, and emergency and crisis management). In addition, we 
attempted to achieve participation by experts from key federal 
organizations, state and local agencies, industry and nonprofit 
organizations, and water utilities serving populations of varying 
sizes. To obtain information from the expert panel, we employed a 
modified version of the Delphi method. The Delphi method is a 
systematic process for obtaining individuals' views and seeking 
consensus among them, if possible, on a question or problem of 
interest. Since first developed by the RAND Corporation in the 1950s, 
the Delphi method has generally been implemented using face-to-face 
group discussions. For this study, however, we administered the method 
through the Internet. We conducted our work in accordance with 
generally accepted government auditing standards between July 2002 and 
August 2003.
Experts Identified Key Vulnerabilities That Could Compromise Drinking 
        Water Systems' Security
    Our panel of experts identified several key physical assets of 
drinking water systems as the most vulnerable to intentional attack. In 
general, their observations were similar to those of public and private 
organizations that have assessed the vulnerability of these systems to 
terrorist attacks, including the National Academy of Sciences, Sandia 
National Laboratories, and key industry associations. In particular, as 
shown in figure 3, nearly 75 percent of the experts (32 of 43) 
identified the distribution system or its components as among the top 
vulnerabilities of drinking water systems. Experts also identified 
overarching issues compromising how well these assets are protected. 
Chief among these issues are (1) a lack of redundancy in vital systems, 
which increases the likelihood that an attack could render a system 
inoperable; and (2) the difficulty many systems face in understanding 
the nature of the threats to which they are exposed.
    I would first like to discuss the distribution system, since it was 
cited most frequently as a key vulnerability by our panelists. The 
distribution system delivers drinking water primarily through a network 
of underground pipes to homes, businesses, and other customers. While 
the distribution systems of small drinking water utilities may be 
relatively simple, larger systems serving major metropolitan areas can 
be extremely complex. One such system, for example, measures water use 
through 670,000 metered service connections, and distributes treated 
water through nearly 7,100 miles of water mains that range from 2 
inches to 10 feet in diameter. In addition to these pipelines and 
connections, other key distribution system components typically include 
numerous pumping stations, treated water storage tanks, and fire 
hydrants.
    In highlighting the vulnerability of distribution systems, our 
panelists most often cited their accessibility at so many points. One 
expert, for example, cited the difficulty in preventing the 
introduction of a contaminant into the distribution system from inside 
a building ``regardless of how much time, money, or effort we spend 
protecting public facilities.'' Experts also noted that since the water 
in the distribution system has already been treated and is on the way 
to the consumer, the distribution of a chemical, biological, or 
radiological agent in such a manner would be virtually undetectable 
until it was too late to prevent harm. While research on the fate and 
transport of contaminants within water treatment plants and 
distribution systems is under way, according to one expert, limited 
technologies are readily available that can detect a wide range of 
contaminants once treated water is released through the distribution 
system for public use.
    Several other components, though not considered as critical as the 
distribution system, were still the subject of concern. Nearly half the 
experts (20 of 43) identified source water as among drinking water 
systems' top vulnerabilities. One expert noted, for example, that 
``because of the vast areas covered by watersheds and reservoirs, it is 
difficult to maintain security and prevent intentional or accidental 
releases of materials that could have an adverse impact on water 
quality.'' Yet some experts cited factors that mitigate the risks 
associated with source water, including (1) the source water typically 
involves a large volume of water, which in many cases could dilute the 
potency of contaminants; (2) the length of time (days or even weeks) 
that it typically takes for source water to reach consumers; and (3) 
the source water will go through a treatment process in which many 
contaminants are removed.
    Also cited as vulnerabilities were the sophisticated computer 
systems that drinking water utilities have come to rely upon to manage 
key functions. These Supervisory Control and Data Acquisition (SCADA) 
systems allow operators to monitor and control processes throughout 
their drinking water systems. Although SCADA systems have improved 
water utilities' efficiency and reduced costs, almost half of the 
experts on our panel (19 of 43) identified them as among these 
utilities' top vulnerabilities.
    Thirteen of the 43 experts identified treatment chemicals, 
particularly chlorine used for disinfection, as among utilities' top 
vulnerabilities. Experts cited the inherent danger of storing large 
cylinders of a chemical on site, noting that their destruction could 
release toxic gases in densely populated areas. Some noted, however, 
that this risk has been alleviated by utilities that have chosen to use 
the more stable liquid form of chlorine instead of the more vulnerable 
compressed gas canisters that have traditionally been used.
    Finally, experts identified overarching issues that compromise the 
integrity of multiple physical assets, or even the entire drinking 
water system. Among these is the lack of redundancy among vital 
systems. Many drinking water systems are ``linear''--that is, they have 
single transmission lines leading into the treatment facility and 
single pumping stations along the system, and often use a single 
computer operating system. They also depend on the electric grid, 
transportation systems, and single sources of raw materials (e.g., 
treatment chemicals). Many experts expressed concern that problems at 
any of these ``single points of failure'' could render a system 
inoperable unless redundant systems are in place. Experts also cited 
the lack of sufficient information to understand the most significant 
threats confronting individual utilities. According to the American 
Water Works Association, assessments of the most credible threats 
facing a utility should be based on knowledge of the ``threat profile'' 
in its specific area, including information about past events that 
could shed light on future risks. Experts noted, however, that such 
information has been difficult for utilities to obtain. One expert 
suggested that the intelligence community needs to develop better 
threat information and share it with the water sector.
Experts' Views on the Allocation and Distribution of Federal Funds
    Many drinking water utilities have been financing at least some of 
their security upgrades by passing along the costs to their customers 
through rate increases. Given the cost of these upgrades, however, the 
utility industry is also asking that the taxpayer shoulder some of the 
burden through the appropriations process. Should Congress and the 
administration agree to this request, they will need to address key 
issues concerning who should receive the funds and how they should be 
distributed. With this in mind, we asked our panel of experts to focus 
on the following key questions: (1) To what extent should utilities' 
vulnerability and risk assessment information be considered in making 
allocation decisions? (2) What types of utilities should receive 
funding priority? and (3) What are the most effective mechanisms for 
directing these funds to recipients?
    Regarding the first of these questions, about 90 percent of the 
experts (39 of 43) agreed ``strongly'' or ``somewhat'' that funds 
should be allocated on the basis of vulnerability assessment 
information, with some citing the vulnerability assessments (VAs) 
required by the Bioterrorism Act as the best available source of this 
information. Several experts, however, pointed to a number of 
complicating factors. Perhaps the most significant constraint is the 
Bioterrorism Act's provision precluding the disclosure of any 
information that is ``derived'' from vulnerability assessments 
submitted to EPA. The provision protects sensitive information about 
each utility's vulnerabilities from individuals who may then use the 
information to harm the utility. Hence, the law specifies that only 
individuals designated by the EPA Administrator may have access to the 
assessments and related information. Yet, according to many of the 
experts, even those individuals may face constraints in using the 
information. They may have difficulty, for example, in citing 
vulnerability assessments to support decisions on allocating security-
related funds among utilities, as well as decisions concerning research 
priorities and guidance documents. Others cited an inherent dilemma 
affecting any effort to set priorities for funding decisions based on 
the greatest risk--whatever does not receive attention becomes a more 
likely target.
    Regarding the second question concerning the types of utilities 
that should receive funding priority, 93 percent of the experts (40 of 
43) indicated that utilities serving high-density population areas 
should receive a high or the highest priority in funding (See figure 
4.). Fifty-five percent deemed this criterion as the highest priority. 
Most shared the view of one expert who noted that directing limited 
resources to protect the greatest number of people is a common factor 
when setting funding priorities. Experts also assigned high priority to 
utilities serving critical assets, such as national icons representing 
the American image, military bases, and key government, academic, and 
cultural institutions.
    At the other end of the spectrum, only about 5 percent of the 
experts (2 of 43) stated that utilities serving rural or isolated 
populations should receive a high or highest priority for federal 
funding. These two panelists commented that such facilities are least 
able to afford security enhancements and are therefore in greatest need 
of federal support. Importantly, the relatively small percentage of 
experts advocating priority for smaller systems may not fully reflect 
the concern among many of the experts for the safety of these 
utilities. For example, several who supported higher priority for 
utilities serving high-density populations cautioned that while 
problems at a large utility will put more people at risk, utilities 
serving small population areas may be more vulnerable because of weaker 
treatment capabilities, fewer highly trained operators, and more 
limited resources.
    Regarding the mechanisms for distributing federal funds, 86 percent 
of the experts (37 of 43) indicated that direct grants would be 
``somewhat'' or ``very'' effective in allocating federal funds (See 
figure 5.) One expert cited EPA's distribution of direct security-
related grant funds in 2002 to larger systems to perform their VAs as a 
successful initiative. Importantly, 74 percent also supported a 
matching requirement for such grants as somewhat or very effective. One 
expert pointed out that such a requirement would effectively leverage 
limited federal dollars, thereby providing greater incentive to 
participate.
    The Drinking Water State Revolving Fund (DWSRF) received somewhat 
less support as a mechanism for funding security enhancements. About 
half of the experts (22 of 43) indicated that the fund would be 
somewhat or very effective in distributing federal funds, but less than 
10 percent indicated that it would be very effective.1 One 
expert cautioned that the DWSRF should be used only if a process were 
established that separated funding for security-related needs from 
other infrastructure needs. Others stated that as a funding mechanism, 
the DWSRF would not be as practical as other mechanisms for funding 
improvements requiring immediate attention, but would instead be better 
suited for longer-term improvements.
---------------------------------------------------------------------------
    \1\ The DWSRF program provides federal grant funds to states, which 
in turn allow the states to help public water systems in their efforts 
to protect public health and ensure their compliance with the Safe 
Drinking Water Act. States may use the funds to provide loans to public 
water systems, and may reserve a portion of their grants to finance 
other projects that protect sources of drinking water and enhance the 
technical, financial, and managerial capacity of public water systems.
---------------------------------------------------------------------------
Activities Experts Identified as the Most Deserving of Federal Support
    When experts were asked to identify specific security-enhancing 
activities most deserving of federal support, their responses generally 
fell into three categories: (1) physical and technological upgrades to 
improve security and research to develop technologies to prevent, 
detect, or respond to an attack, (2) education and training to support, 
among other things, simulation exercises to provide responders with 
experience in carrying out emergency response plans, and specialized 
training of utility security staff; and (3) strengthening key 
relationships between water utilities and other agencies that may have 
key roles in an emergency response, such as public health agencies, law 
enforcement agencies, and neighboring drinking water systems.
    As illustrated in figure 6, specific activities to enhance physical 
security and support technological improvements generally fell into 
nine subcategories. Of these, the development of ``near real-time 
monitoring technologies,'' capable of providing near real-time data for 
a wide array of potentially harmful water constituents, received far 
more support for federal funding than any other subcategory--over 93 
percent of the experts (40 of 43) rated this subcategory as deserving 
at least a high priority for federal funding. More significantly, 
almost 70 percent (30 of 43) rated it the highest priority--far 
surpassing the rating of any other category. These technologies were 
cited as critical in efforts to quickly detect contamination events, 
minimize their impact, and restore systems after an event has passed. 
The experts' views were consistent with those of the National Academies 
of Science, which in a 2002 report highlighted the need for improved 
monitoring technologies as one of four highest-priority areas for 
drinking water research and development.2 The report noted 
that such technologies differ significantly from those currently used 
for conventional water quality monitoring, stating further that sensors 
are needed for ``better, cheaper, and faster sensing of chemical and 
biological contaminants.''
---------------------------------------------------------------------------
    \2\ Making the Nation Safer: The Role of Science and Technology in 
Countering Terrorism, p. 250. The National Research Council of the 
National Academies. (Washington, D.C.: The National Academies Press, 
2002).
---------------------------------------------------------------------------
    In addition to real-time monitoring technologies, the experts 
voiced strong support for (1) increasing laboratories' capacity to deal 
with spikes in demand caused by chemical, biological, or radiological 
contamination of water supplies, and (2) ``hardening'' the physical 
assets of drinking water facilities through improvements such as adding 
or repairing fences, locks, lighting systems, and cameras and other 
surveillance equipment. Regarding the latter of these two, however, 
some experts cited inherent limitations in attempting to 
comprehensively harden a drinking water facility's assets. In 
particular, they noted in particular that, unlike nuclear power or 
chemical plants, a drinking water system's assets are spread over large 
geographic areas, particularly the source water and distribution 
systems.
    Regarding efforts to improve education and training, over 90 
percent of the experts (39 of 43) indicated that improved technical 
training for security-related personnel warrants at least a high 
priority for federal funding. (See figure 7.) Over 55 percent (24 of 
43) indicating that it deserved the highest priority. To a lesser 
extent, experts supported general training for other utility personnel 
to increase their awareness of security issues. The panelists also 
underscored the importance of conducting regional simulation exercises 
to test emergency response plans, with more than 88 percent (38 of 43) 
rating this as a high or highest priority for federal funding. Such 
exercises are intended to provide utility and other personnel with the 
training and experience needed both to perform their individual roles 
in an emergency and to coordinate these roles with other responders. 
Finally, about half the experts assigned at least a high priority to 
supporting multidisciplinary consulting teams (``Red Teams''), 
comprising individuals with a wide array of backgrounds, to provide 
independent analyses of utilities' vulnerabilities.
    As illustrated in figure 8, experts also cited the need to improve 
cooperation and coordination between drinking water utilities and 
certain other organizations as key to improving utilities' security. 
Among the organizations most often identified as critical to this 
effort are public health and law enforcement agencies, which have data 
that can help utilities better understand their vulnerabilities and 
respond to emergencies. In addition, the experts cited the value of 
utilities' developing mutual aid arrangements with neighboring 
utilities. Such arrangements sometimes include, for example, sharing 
back-up power systems or other critical equipment. One expert described 
an arrangement in the San Francisco Bay Area--the Bay Area Security 
Information Collaborative (BASIC)--in which eight utilities meet 
regularly to address security-related topics. Finally, over 90 percent 
of the experts (39 of 43) rated the development of common protocols 
among drinking water utilities to monitor drinking water threats as 
warranting a high or highest priority for federal funding. Drinking 
water utilities vary widely in how they perceive threats and detect 
contamination, in large part because few common protocols exist that 
would help promote a more consistent approach toward these critical 
functions. Some experts noted, in particular, the need for protocols to 
guide the identification, sampling, and analysis of contaminants.
Observations
    In 2002, EPA's Strategic Plan on Homeland Security set forth the 
goal of significantly reducing unacceptable security risks at water 
utilities across the country by completing appropriate vulnerability 
assessments; designing security enhancement plans; developing emergency 
response plans; and implementing security enhancements. The plan 
further committed to providing federal resources to help accomplish 
these goals as funds are appropriated.
    Key judgments about which recipients should get funding priority, 
and how those funds should be spent, will have to be made in the face 
of great uncertainty about the likely targets of attacks, the nature of 
attacks (whether physical, cyber, chemical, biological, or 
radiological), and the timing of attacks. The experts on our panel have 
had to consider these uncertainties in developing their own judgments 
about these issues. These judgments, while not unanimous on all 
matters, suggested a high degree of consensus on a number of key 
issues.
    We recognize that such sensitive decisions must ultimately take 
into account political, equity, and other considerations. But we 
believe they should also consider the judgments of the nation's most 
experienced individuals regarding these matters, such as those included 
on our panel. It is in this context that we offer the results presented 
in this testimony as information for Congress and the administration to 
consider as they seek the best way to use limited financial resources 
to reduce threats to the nation's drinking water supply.
    Mr. Chairman, this completes my prepared statement. I would be 
happy to respond to any questions you or other Members of this 
Subcommittee may have.
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    Mr. Gillmor. Thank you very much, Mr. Stephenson.
    The Chair will recognize himself for some questions.
    First question to Mr. Grumbles, or you could jump in, too, 
if you wanted, Mr. Stephenson, is could you give us some kind 
of indication as the amount of poison or contaminant it would 
take to have widespread impact on a system? I think there is, 
you know, the movie version where you get some bad guy with a 
vial, he dumps it in a reservoir and he poisons a city. Other 
people have said to really cause any widespread harm you would 
have to be dumping contaminants equal to several tanks, trucks 
full.
    Could you just give us some kind of ballpark indication of 
how much contaminant it would take to poison a system?
    Mr. Stephenson. Well, I will make a comment before Ben 
does. But that is, in fact, why the distribution system was 
cited as the greatest vulnerability. Source water, such as a 
reservoir, is pretreatment, and is not a very effective way to 
contaminate drinking water.
    However, when is the last time you saw a truck backed up to 
a fire hydrant and assumed he was taking water out of the 
system? He could just as easily be putting a contaminant into 
the system. Since it is post treatment, it goes directly to the 
homes or businesses from there. And that is why I think our 
experts cited that as a very high vulnerability.
    Mr. Grumbles. Mr. Chairman, I think the question you asked 
is on the minds of a lot of people, and the simple basic answer 
is that it truly does depend--it depends on the contaminant and 
the situation. So there is--no real short answer to that. It 
just largely varies, based on the contaminant involved and the 
nature of placing the contaminant within the system.
    Mr. Gillmor. To follow up on that, during the hearing in 
the House Science Committee in 2001--and I think actually you 
were working on the staff there at the time--EPA was working on 
a state of knowledge report with DOD, Centers for Disease 
Control, FBI, Food and Drug Administration, the Office of 
Homeland Security, to compile and assess known information 
about biological, chemical and radiological contaminants, as 
well as a detection technology.
    Could you tell us what the status is of that working group, 
and is EPA still working to find out about new contaminants?
    Mr. Grumbles. Yes, sir. Based on the findings of an 
interagency work group that we convened to address the state of 
the knowledge--this is the report that you referenced--we 
include recommendations on vulnerabilities of water systems 
that should be considered, along with the potential mitigation 
actions in our baseline threat document.
    Our baseline threat document is a critically important 
document that we provided to utilities back in 2002, to help 
assist them in vulnerability assessments and to prepare an 
emergency response plan. So what we are currently doing is 
undertaking analyses to fill in gaps in the knowledge and 
working with other agencies as well to do so.
    Developing analytical methods for some contaminants, for 
determining the effectiveness of disinfection practices for 
particular contaminants. That is some of the examples of the 
things we are doing. So I appreciate the chance to talk a 
little bit about that state of the knowledge report and how we 
have been following up.
    Mr. Gillmor. So basically, you have been disseminating some 
of that information through the assessment process; is that 
correct?
    Mr. Grumbles. That is correct, providing it to the 
utilities to help inform them. I guess it is important to 
clarify as well. We need to provide the information to 
utilities as they were tasked with developing their 
vulnerability assessments. We did indeed flag concerns about 
terrorism.
    It wasn't just the pre9/11 world, it was post 9/11. So it 
was very important to clarify. We included that information in 
terms of the baseline threat document.
    But the state of the knowledge report also fed into that 
effort to provide guidance.
    Mr. Gillmor. A quick question for Mr. Stephenson. 
Recognizing that rural water systems are at least able to 
afford security enhancements, but also recognizing that even in 
your study, your experts suggested that utilities serving high-
density populations should receive the highest priority in 
funding.
    Do you have any suggestions as to how we ought to allocate 
Federal funding and in that respect, did your study have a 
significant amount of experts representing rural communities?
    Mr. Stephenson. I believe we had a member of the Rural 
Water Association on it. But obviously the high density 
populations--the 466 large systems that serve over 50 percent 
of the population always came up as a higher priority--even 
though we tried to get balanced representation across our 43 
experts. As you know, the Bioterrorism Act addresses systems 
bigger than 3,300 but even at that suggests that EPA provides 
guidance to the smaller utilities, and I believe there are over 
160,000 facilities that serve less than 500. So it becomes 
economies of scale, I guess as to how you could best provide 
funding for those small public systems.
    Mr. Grumbles. Mr. Chairman, I would just like to add that 
while the priorities--and the focuses and the timeframes in the 
Bioterrorism Act focused on the larger systems--we have not 
lost sight of the fact that thousands and thousands of smaller 
systems in the country should be doing their part as well. EPA 
has provided--over the last several years--about 25 percent of 
its budget for the water security efforts to the small systems, 
$36 million for training and technical assistance and working 
with small systems through workshops and indirect assistance 
with rural water circuit riders.
    Mr. Gillmor. Thank you.
    The gentlelady from California.
    Ms. Solis. Thank you, Mr. Chairman. This is for Mr. 
Grumbles from EPA. The Inspector General suggested that the EPA 
needs to analyze the quality of the vulnerability assessments 
submitted by large utilities to determine whether they 
adequately address the threats envisioned by the Bioterrorism 
Act. Has the EPA analyzed the quality of all the vulnerability 
assessments of the 350 largest systems that served over 116 
million Americans?
    Mr. Grumbles. Congresswoman, I really appreciate the 
question. In my conversations with the Inspector General and in 
taking to heart recommendations she has, sometimes we don't 
always agree with them, but they are always helpful to see 
where the Inspector General might have information.
    On this particular issue, what we agreed to do was to 
convene a prestigious subgroup of the National Drinking Water 
Advisory Council, the Water Security Working Group, and we have 
specifically tasked them with developing measures to gauge 
``the quality or the effectiveness of the plans.''
    Ms. Solis. How many have been analyzed? Do you have a 
number?
    Mr. Grumbles. How many have been?
    Ms. Solis. Of the largest 350 that have actually been 
analyzed by EPA?
    Mr. Grumbles. Well, we have received all of the 
vulnerability assessments.
    Ms. Solis. Right. But that doesn't mean that you have 
analyzed them. Are they?
    Mr. Grumbles. Well, we follow the--a couple of points. 
First of all, we have very specific framework for reviewing the 
quality of the vulnerability assessments as laid out in the 
statute. Our job and interpretation of the statute has been 
that EPA reviews them to insure compliance with the basic 
requirements, provisions of the law--as is the intent of 
Congress--and so we have reviewed all of the vulnerability 
assessments on the quality component.
    What we have specifically asked is to get this independent 
group that includes experts from various sectors, governmental, 
nongovernmental to look at that issue and to develop measures 
for effectiveness to help address that question of what is the 
quality of the vulnerability assessments.
    Ms. Solis. So that can vary depending on whatever report 
you can get from one of these 350 large systems? I mean, this 
is very--this is somewhat, very subjective.
    Mr. Grumbles. Well, a couple of things again. I think that 
one of the things that, the Drinking Water Advisory Council, 
their water security working group, is not specifically 
reviewing each of the vulnerability assessments themselves, 
that is an important point. And the way the law is currently 
written, I don't think that would be legal, unless we----
    Ms. Solis. Why would that not be legal?
    Mr. Grumbles. Unless we designated each and every one of 
those.
    Ms. Solis. I guess what I am trying to understand, if you 
have 350 large systems that you are supposed to be collecting 
data for, and you want to try to get some standard or criteria, 
if they are all needing--or what we have set out that they 
should need, and you have an expert group looking at that, it 
doesn't really give me a sense that we have some uniformity 
here. I mean, it could vary. You could get different feedback 
from different parts of the----
    Mr. Grumbles. I don't think we have, there is--not a real 
disagreement here. I think I need to communicate more clearly.
    We recognize that it is important not to have just a 
subjective--I mean, basically what the Inspector General was 
getting at, I believe, was what is the overall quality of these 
vulnerability assessments?
    Ms. Solis. But they have questioned that. They have 
questioned your measurement of that.
    Mr. Grumbles. Right. And we working with them said, you 
know, it would be good to get some helpful criteria to define 
what is an effective security program. And that specifically is 
what the Drinking Water Advisory Council is tasked to come up 
with to help shed some light to share and share with us what 
that is.
    So I think----
    Ms. Solis. My understanding is that you do have clear 
authority to do assessments for each of these vulnerability 
assessment studies. That is my understanding. You have just 
said something different earlier.
    Mr. Grumbles. No. We do specifically review each of the 
vulnerability assessments.
    Ms. Solis. But you haven't. You haven't done all of them?
    Mr. Grumbles. No. We have. We have them all. We have 
received them all within the agency.
    Ms. Solis. Right. And they have all been analyzed and 
assessed by the EPA.
    Mr. Grumbles. My staff is informing me that the large ones, 
the 400-plus vulnerability assessments that we have received, 
we have reviewed.
    Ms. Solis. Can I have that? I would like to have that in 
writing----
    Mr. Grumbles. Sure.
    Ms. Solis. [continuing] for this committee. And if you can 
guarantee that as well.
    My time is almost up. I just have a question with respect 
to when, say, a water facility submits their plan and after you 
find that there might be some questions or issues about their 
plan with respect to--I don't want to say terrorism--but, say, 
maybe disgruntled employees that may disrupt the facility. How 
do you separate that out from looking at plants for addressing 
terrorism?
    Mr. Grumbles. Let me make sure I understand. Separating 
vandalism from terrorism?
    Ms. Solis. My understanding is that there has been a lot of 
reporting of that in these plans, and there hasn't been enough?
    Mr. Grumbles. In the emergency response plans or 
vulnerability assessment?
    Ms. Solis. Vulnerability assessment.
    Mr. Grumbles. Am I allowed to talk about--you know, I would 
welcome the opportunity to talk with you on--to the extent I 
can, the specifics of the vulnerability assessments, but, I 
think, not in a public forum.
    Ms. Solis. Okay.
    Mr. Grumbles. I would like to emphasize, and clarify what I 
have said with respect to the Inspector General, we have worked 
with the Inspector General, designated several of their people 
to actually look at and review the vulnerability assessments. 
And so if I, if that was not clear, I wanted to make sure that 
that was clear.
    Mr. Gillmor. I will come back, I guess, to that question.
    Mr. Grumbles. And that was after, after they gave us the 
report, we said we will designate you and you can review, 
actually review the vulnerability assessments. So. I think we 
are working with them--and we want to particularly also get the 
working group from the National Drinking Water Advisory Council 
to have some objective criteria as to what is a successful 
program.
    Ms. Solis. I guess in the report that I am seeing right in 
front of me, right now, you believe that you can analyze 
information in vulnerability assessments because this would 
violate the Public Health Security Safety and Bioterrorism 
Preparedness and Response Act. That was your response. However, 
the council says that EPA does, in fact, have the authority as 
well as the responsibility to collect and analyze necessary 
information on these sources. That is what the inspector 
general said.
    Mr. Grumbles. And I believe that we, through Congress' 
leadership in appropriating funds for grants for vulnerability 
assessments--it is also our responsibility to ensure that the 
purposes of the grant are carried out; and so the basic 
requirements that are in those statutes about vulnerability 
assessments are done. So that as we have gotten the large 
vulnerability assessments and reviewed them, we have 
specifically looked at those factors, taken that into account.
    And we welcome the inspector general's comments and the 
National Drinking Water Advisory Council's objective criteria 
that they will use for quality.
    Mr. Gillmor. The gentlelady's time has expired.
    Just as a point of information, the limitations that Mr. 
Grumbles was talking about were, I think, in section 1435 of 
the conference report of the Bioterrorism Act as to what type 
of thing they can do.
    The gentleman from Michigan, Mr. Rogers.
    Mr. Rogers. I will pass.
    Mr. Gillmor. The gentleman passes.
    The other gentleman from the northern peninsula.
    Mr. Stupak. Thank you, Mr. Chairman.
    Mr. Grumbles, in this legislation you got $160 million to 
do these assessments, these vulnerability assessments. And the 
way I read this report, EPA has not done a very good job.
    While you have done a good job of getting the reports in, 
the vulnerability assessments are really pre-9/11. In other 
words, these assessments, because of lack of leadership from 
the EPA, more utilities focused on vandals, criminals, and 
disgruntled employees in their vulnerability assessment.
    Contractors further stated--these contractors that Mr. 
Stephenson talked about, further stated that EPA has not 
provided utilities the intelligence data or threat information 
required to justify the security upgrades necessary to defend 
against terrorism. While the terrorist attacks of 9/11 and 
subsequent passage of the Bioterrorism Act served as a catalyst 
for the vulnerability assessments, limited threat information 
provided by the EPA resulted in utilities subjectively 
designing their assessments around pre-9/11 threats.
    After filtering threat information through the RAMW 
methodology, most of the water security experts we interviewed 
who were familiar with vulnerability assessments concluded that 
the only threats utilities could realistically address were 
those they encountered before 9/11, being the vandals, the 
criminals and disgruntled employees. One utility representative 
we interviewed said that the contractor they hired to conduct 
their vulnerability assessment discouraged them from addressing 
higher threat levels like terrorism.
    So, in answer to Ms. Solis' questions and that, while you 
have a lot of paperwork to submit to the EPA, it doesn't meet 
the guidelines put forth by the Bioterrorism Act, and it is 
really not a question of money because, you know, $160 million 
should have at least given us some kind of ideas, not what 
happened before 9/11.
    The reason why you had the Bioterrorism Act was because of 
9/11, and it seems like we have missed the whole point here 
because of lack of guidance from the EPA.
    Mr. Grumbles. Congressman, I would say a couple of things. 
One, I would respectfully--respectfully would disagree with the 
characterization in the sense that when we put together the 
baseline threat document and when we put additional guidance 
forward with utilities, we did emphasize terrorism and 
terrorist attacks.
    I would also say that based on our customer surveys, the 
information we have gotten from our customers, the utilities, 
we have gotten a large sense of satisfaction in terms of the 
guidance and information that was provided.
    The last point I would make, Congressman, is that while we 
feel that we have provided guidance, helpful guidance, to 
utilities in developing vulnerability assessments this first 
round, these initial vulnerability assessments are not the be 
all and end all. I fully----
    Mr. Stupak. I would hope not, because you haven't even 
addressed terrorism according to this report. And this isn't 
the Office of Inspector General; this is from your own internal 
documents. This is your own reports.
    Mr. Grumbles. I think that the vulnerability assessments 
are viewed as a step forward. I think that they continue to, 
and will, improve. And--they need to be living documents, and 
they will only improve.
    And I think utilities have done a good job in this first 
round. We are in a new era after the Bioterrorism Act, and I 
think they have done a good job, and our job is to provide them 
additional information.
    Mr. Stupak. Your own document says--from Jeffrey K. Harris, 
Director of Program Evaluations, Cross-Media Issues, was to 
Tracy Meehan, Assistant Administrator for Office of Water, 
certainly doesn't say that. And if you look at the IG report, 
it says--let me quote here on page 5:
    ``One of the security experts we interviewed stated the EPA 
did not provide adequate threat information. Officials at the 
Sandia National Laboratory stated that the EPA threat guidance 
missed the mark because EPA did not set minimum threat levels 
against which utilities need to assess their vulnerabilities.''
    If you don't have any standard, I guess you could call 
anything a success because you have no standard to judge it 
against. And that is where we think the leadership is lacking 
from the EPA.
    Mr. Grumbles. Congressman, do you know if the inspector 
general had reviewed any of the vulnerability assessments when 
that statement was made?
    See, my information----
    Mr. Stupak. Well, that is why we want the inspector general 
here. If he is not here, we can't answer it. You can't answer 
it. I can't answer it.
    So let me ask you this one: How about you? Has the EPA 
exercised its authority and required any drinking water 
utilities to take corrective actions to address vulnerabilities 
to terrorist acts or other intentional acts? Have you, EPA, 
exercised your authority requiring them to do anything to take 
corrective action, other than submit these plans?
    Mr. Grumbles. I guess my point----
    Mr. Stupak. No, no, just a yes or no.
    Come on now, corrective action or not. Did you guys direct 
anyone to take corrective action or not?
    Mr. Grumbles. Enforcement action?
    Take any enforcement--I don't know.
    Mr. Stupak. You have the authority and are required that if 
there is a lack of security at these water utility places, you 
have the right and the authority to require them to take 
corrective action. Have you done that, in looking at these 
plans, since you had 400 sitting in your office from the large 
utilities?
    Mr. Grumbles. We take our responsibilities and authority 
seriously. And I am not sure that we have the authority to take 
an enforcement action in that situation.
    I can assure you----
    Mr. Stupak. Okay. Whether you need the authority, did EPA 
do anything, whether you had the authority or not?
    Let us pretend you had it for a minute, okay? Did you take 
any corrective action, or are all these plans, all 400, just 
perfect?
    Mr. Grumbles. If we had the authority, then our first step 
would be to ensure compliance assurance. And then if the 
community didn't take those steps, then we would take an 
enforcement action.
    Mr. Stupak. So you haven't taken any enforcement action 
yet?
    Mr. Grumbles. Well, we think that we have exercised the 
current authorities that we have, current legal authorities. 
And I would emphasize, Mr. Chairman, that the whole--the 
underlying basis for progress here is partnership with the 
communities.
    Mr. Stupak. Well, you know, under authority--I am looking 
at a letter here April 22, 2002. It is from Christy Todd 
Whitman, EPA Director, to John Dingell. On page 2 of that 
letter it says, ``The language contained in 3448''--that is the 
bioterrorism bill--''amending the Safe Drinking Water Act, 
section 1431, provides EPA with adequate authority to respond 
in situations involving significant vulnerability.''
    So that is why I asked my question, since you have the 
authority and are required. So did you take any action to 
address these significant----
    Mr. Grumbles. I appreciate your clarifying that because 
that is the provision in the statute that deals with imminent 
and substantial endangerment. And I am not--I don't--and 
fortunately, I don't think we have had any situations where we 
have exercised that rare authority to step in in the context of 
a vulnerability assessment or an emergency response plan.
    Mr. Stupak. I am out of time, but I will keep going if you 
let me.
    Mr. Gillmor. How about we come back for another round?
    Mr. Stupak. Sure.
    Mr. Gillmor. Mr. Terry apparently got tired of waiting, so 
we will recognize him when he comes back, although he did have 
a couple of questions.
    In fact, I know what he was going to ask. I might ask one 
of those questions on his behalf; and that is, one of the 
bigger concerns is making sure that EPA is not ignoring small 
water systems in order to focus solely on the largest drinking 
water systems. It was his understanding that EPA had been using 
money to provide the trainer grants, to provide a number of 
environmental professionals to give training and technical 
assistance to water systems serving fewer than 50,000 people.
    And then his question was: ``What is the status of this 
program?''
    Mr. Grumbles. Yes, sir.
    Mr. Gillmor. And what other actions is EPA taking to help 
smaller water systems?
    And the third part of that was, what fraction of the 
drinking water security budget is being spent on smaller 
systems?
    Mr. Grumbles. Since 2002, what EPA has done is what--we 
have provided $36 million for training and technical assistance 
for the small water systems, those less than 50,000, under the 
terms of the Bioterrorism Act. This is approximately 25 percent 
of the budget 2002 through 2004.
    We have used a multi-pronged approach, Mr. Chairman, to try 
to reach the nearly 8,000 systems that are--those less than 
50,000 that are required to undertake vulnerability assessments 
and develop or revise emergency response plans. Besides 
training the trainers, Mr. Chairman, we provided direct 
assistance to trainers such as the rural water circuit riders.
    So, as a result, the number I have is that more than 88 
percent of the small systems have met the deadline for 
submitting the vulnerability assessments. So, again, while the 
focus, I think, of the drafters and of the Nation also is on 
timeframes for the large metropolitan areas, we certainly 
recognize the importance of getting out assistance and ensuring 
that the smaller systems throughout the country are also 
assessing and developing emergency response plans and getting 
the information they need to secure their systems.
    Mr. Gillmor. Then also--although not as good looking as Mr. 
Terry, I am standing in for him.
    Mr. Stephenson, how helpful will real-time monitoring 
technologies, capability of providing near real-time data for a 
wide array of potentially harmful contaminants be in addressing 
security issues? And why do you think this technology received 
the most support for Federal funding?
    Mr. Stephenson. I think the experts felt that because the 
distribution system was the most vulnerable, these detection 
and monitoring capabilities would be placed in the distribution 
systems so that would give real-time information if there was a 
contaminant in the system. Facilities currently have no 
capacity to do this. So they felt a lot of research was needed 
in that area, more so than hardening or anything else; and I 
think that is why that cropped up as the highest priority from 
our experts.
    Mr. Gillmor. And Mr. Grumbles, how does EPA receive threat 
information? Does it come from FBI, DHS, or other parts of the 
Intelligence Community? And what is the extent of collaboration 
with DHS? And what are the procedures to make sure that 
information flows down the chain to water systems in a timely 
manner?
    Mr. Grumbles. Well, Mr. Chairman, how do we get our 
information? We get it through a variety of sources, primarily 
DHS, FBI, CIA. We are working very closely with the Department 
of Homeland Security. While we are the sector-specific lead for 
the water infrastructure sector, we do report to them and we 
work very closely with them.
    And we also within the agency have an Office of Emergency 
Preparedness, as well as an Office of Homeland Security, to 
help provide specific liaison to the other agencies throughout 
the Federal family of Homeland Security individuals.
    Mr. Gillmor. Thank you, Mr. Grumbles.
    And we will go to another round of questions.
    And, Ms. Solis.
    Ms. Solis. Thank you, Mr. Chairman. I would like to request 
unanimous consent to also submit several editorial articles to 
support action to decrease threats at chemical facilities.
    Mr. Gillmor. Without objection.
    [The information referred to follows:]
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    Ms. Solis. Thank you.
    Mr. Grumbles, going back to Los Angeles, we are a very 
large urban center there, and obviously the DWP is one of the 
largest water providers in Los Angeles. They have submitted 
their plan, a 5-year plan, and my understanding is that you 
have received that. But, looking at it, there are so many 
issues that just kind of beg to be answered.
    One is that they have a budget problem with respect to 
employees there having to somewhat police and provide 
surveillance for their facilities. And overtime is a big issue 
because they have not come up with, say, installing electronic 
surveillance equipment.
    What types of advice do you give to agencies like that to 
urge them or at least to direct more grant money so that they 
can accomplish this goal, knowing that they are faced with 
these--and L.A. isn't the only one. I am sure this is with a 
lot of other facilities.
    How is it that you get back to them, and what is the 
timeframe if there are changes that you think could help or to 
modify their plan? What is it that you do to get back to them?
    Mr. Grumbles. I--you mentioned L.A., and that is a perfect 
example of a city where there is so much at stake and where 
initiative has already occurred and they are moving out front. 
And then it translates into, they have developed plans and very 
specific milestones to try to increase the security of their 
system--how do they finance it and fund it, and how do they, 
you know, get there.
    One of our jobs that we take extremely seriously is to 
provide not only the tools and the training, but the technical 
assistance, ways to find additional funding, and to also use 
some of the existing Federal funding that might be there, if 
not through the Department of Homeland Security, through EPA. 
We have some funding through the drinking water State revolving 
funds, and we issue guidance expressly for the purpose of going 
to States to help the cities use some of those funds that 
traditionally have been used for drinking water, maximum 
contaminant level compliance and drinking water treatment 
plants, and to use those funds for security-related 
enhancements.
    Some of these areas, when you talk about overtime or 
increased O&M, those may not be eligible for assistance under 
that drinking water State revolving fund, and so there are 
other tools or financial assistance. Sometimes, as you and your 
constituents know better than anyone, ultimately it is the 
ratepayer, the customer, that is going to be paying more for 
enhanced security, just like they pay more for enhanced 
drinking water regulations that we issue.
    Ms. Solis. At what point do you get back to the different 
water purveyors, especially the large ones, in terms of their 
plan, though? What do you do to go back and maybe review or 
even audit?
    Mr. Grumbles. Are you talking about--when you say ``a 
plan,'' are you talking about----
    Ms. Solis. Vulnerability.
    Mr. Grumbles. The vulnerability assessment?
    Ms. Solis. Yes. If there are some questions, a red flag 
goes up or something, how quickly do you get back to them to 
let them know that you perceive there is a problem or an issue 
here?
    Mr. Grumbles. I don't know a timeframe.
    Ms. Solis. I mean, this is obviously very, very important. 
And you haven't set up any standard to get to do that?
    Mr. Grumbles. We have a good dialog with the drinking water 
utility associations across the country. We meet regularly with 
them, provide them information.
    Ms. Solis. That is not what I am asking.
    Mr. Grumbles. Well, I think one of the mechanisms--probably 
the Region 9 office might be the closest EPA office to get back 
to them on some of the specifics of the questions they might 
have. But our Office of--our Water Security Division does 
provide information.
    Some of the--Congresswoman, some of the venues that we 
would use would be through our workshops that we have with 
utilities and cities. We are very pleased that we are part of 
the funding and supporting the water--ISAC, Information Sharing 
and Analysis Center, which is a secure Web-based system that 
cities, large and small, utilities, once they get security pass 
words can use to get helpful information on some of their very 
real security-related issues.
    Ms. Solis. But limited to the funds, very limited funds 
available, right, to make any changes?
    Mr. Grumbles. They would certainly say that. And I would 
say, from a Federal EPA budget, funding is always a difficult 
challenge. And as we move into the implementation stage, it 
will continue to be a challenge. But we are taking that very 
seriously and looking at funding as a Federal partner with 
localities and States as we look into the next budget cycle.
    Mr. Gillmor. The gentlelady's time has expired.
    The gentleman from Michigan.
    Mr. Stupak. Thank you, Mr. Chairman.
    Mr. Grumbles, sort of getting back to where I left off, let 
me ask the question this way: Has the EPA requested any 
drinking water utility to take specific corrective action to 
address vulnerabilities to terrorist attacks?
    Mr. Grumbles. I guess I should say I would like to make 
sure that I answer it correctly, and I probably need to get 
back to you for purposes of the record on that.
    I am told no.
    Mr. Stupak. Okay. The large utilities were supposed to be 
done March 31, 2003, to submit their vulnerability assessments 
to you. That has been 18 months ago, and we haven't directed 
anyone to take any corrective actions. So the answer on that is 
no, right?
    So then, if that is the case, you said in your opening 
statement that ``We are smarter and we are safer from terrorist 
attack because of the work of the EPA.'' but with all 
seriousness, how is the public assured that the necessary 
security enhancements are being taken by their water utilities?
    We have these assessments done; there has been no 
corrective action. How do we reassure the public?
    Mr. Grumbles. I think you are raising a good question, and 
that is exactly what is the responsibility of the U.S. EPA in 
implementing and taking steps in the Bioterrorism Act of 2002 
after we get the vulnerability assessments.
    I don't read the statute as saying that EPA has a specific 
authority to follow up.
    Mr. Stupak. Well, when you look at the Presidential 
Decision Directive 63, issued in May 1998, it designated the 
EPA as the lead agency for assuring the protection of the 
Nation's water infrastructure. And so that was back in 1998, 
even before we had 9/11.
    And then the Bioterrorism Act also makes that a 
requirement. You are the lead agency.
    Mr. Grumbles. Congressman, a couple points: One is, we do 
have a broad authority under 1431, as you and your staff know 
full well, that if there is an imminent and substantial 
endangerment to public health, then under that provision--which 
has been in the statute for a long time prior to the 9/11 
incident or the Bioterrorism Act of 2002--we will use our 
enforcement discretion and exercise that. We haven't done that 
to date.
    With respect to the Presidential Directive 63, I mean, we 
do take seriously, and we continue to take seriously under the 
Presidential directives that have come after the Bioterrorism 
Act of 2002, our responsibilities to carry out the act and also 
to coordinate and do increased surveillance and monitoring.
    Mr. Stupak. Well, you know, we have got the Safe Drinking 
Water Act, we have Presidential Directive 63, we have the 
Bioterrorism Act of 2002. Is there some authority you want that 
would make it clearer for you your responsibility that you are 
the lead agency to protect the Nation's utilities and your 
water infrastructure in this country?
    Is there some other authority you need or are looking for?
    Mr. Grumbles. I think that it remains an open question as 
to whether or not Congress needs to revise the statute to 
provide us additional authority. I think we have our focus 
right now----
    Mr. Stupak. Well, we think we have given you three types of 
authority: Directive 63, the Safe Drinking Water Act, and the 
Bioterrorism Act.
    Now, we are the guys who write this stuff, men and women 
who write it, so--but from your point of view, since you are 
supposed to be responsible for carrying it out, you tell us, 
are you missing some authority? Is someone telling you, Geez, 
that is a nice suggestion that I should do this to make sure 
the safe drinking water in Los Angeles is safer, but you know 
what, EPA, you don't have the authority.
    Has anyone ever told you guys that?
    Mr. Grumbles. I think, as I--I did want to emphasize in the 
statement, Congressman, Congress in reviewing the 
implementation of the Bioterrorism Act of 2002 should 
acknowledge and recognize that what that statute did, 
critically important and successful statute, was to set up a 
planning and vulnerability assessment framework, emergency 
response planning. We are carrying that out and implementing 
that, and so I am not here to seek additional regulatory or 
enforcement authorities. I know that our focus is on providing 
the tools and the training, the technical assistance to 
utilities to carry out their plans as they develop them.
    Mr. Stupak. Well, more than just vulnerability assessment. 
Again, go back to the letter I read to you earlier from the EPA 
Director Christy Todd Whitman again, once again, dated April 
22, 2002.
    And, Mr. Chairman, I ask this letter be made part of the 
record.
    Mr. Gillmor. Without objection.
    [The information referred to follows:]
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    [GRAPHIC] [TIFF OMITTED] T6103.038
    
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    Mr. Stupak. The letter to Mr. Dingell. And again I go to 
page 2, the top paragraph. The language contained in H.R. 
3448--that is the Bioterrorism Act--amending the Safe Drinking 
Water Act, section 1431, provides EPA with adequate authority 
to respond to situations involving significant vulnerability.
    So according to the EPA Director, back then Christy Todd 
Whitman, you had significant authority to do what has to be 
done, and your job is really to make sure the public water 
supplies and distributions are secure from terrorist attack, 
more than just take assessments of utilities. You have a real 
responsibility here. And I am afraid the public, if they are 
watching this thing at all or hearing anything about this 
hearing, there is not a lot of assurance that the necessary 
security enhancements are being taken to make sure their water 
is safe.
    Mr. Grumbles. Well, I would disagree with you respectfully, 
Congressman. There is no doubt that work needs to be done, and 
there is no doubt that EPA will exercise its existing 
authorities that it has in the Bioterrorism Act as well as the 
Safe Drinking Water Act. And it is also no doubt to us that 
there needs to be continued cooperative discussion, compliance 
assurance. Our top priority has been, Congressman, to ensure 
that the systems get in their vulnerability assessments and 
their emergency response plans, certify that they have done 
their emergency response plans, and that we work with the other 
Federal and State and local entities on workshops, tools and 
training, and update and improve their plans that they use--
view them as living documents that need to be continuously 
improved.
    Mr. Stupak. With that answer, I take it you agreed with us 
that you have the authority; that you have done a bunch of 
assessments. But what I haven't heard you say in answer to my 
questions here today, you haven't taken any corrective action 
to make sure that these security enhancements are in fact in 
place. Your own internal document basically said the 
evaluations were based upon pre-9/11, which is basically 
vandals, criminals, and disgruntled employees, and because they 
didn't get any guidelines from you as to what we should be 
looking for post-9/11.
    Mr. Gillmor. The gentleman's time has expired. But the 
Chair would extend the gentleman's time long enough for me to 
ask the gentleman if he would yield to me.
    Mr. Stupak. I would be happy to yield to the chairman.
    Mr. Gillmor. I just want to point out as a factual matter 
the letter that you cited predated, as I understand it, the 
passage of the Bioterrorism Act, and whatever authority EPA may 
have, there was no specific authority that I am aware of in the 
Bioterrorism Act for them to take the action that you refer to. 
EPA may have it under other provisions, but I don't think under 
the Bioterrorism Act.
    Mr. Stupak. The language read in was, it was really--the 
question was, the reason why there was a letter between Christy 
Todd Whitman and Mr. Dingell was because they were asking about 
the existing language in the Safe Drinking Water Act, did it 
provide a broad enough general authority to require actions to 
address security concerns. But then they went into the language 
contained in 3448, which was the bioterrorism. And they felt 
that with the two of them, with both 3448, the Safe Drinking 
Water Act, Presidential Directive 63, they had more than enough 
authority to carry it out, not only just to ask for 
assessments, vulnerability assessments, but actually to take 
corrective action as they are the lead agency, as Directive 63 
pointed out, to make sure that we have the assessments done 
properly post-9/11, corrective action be taken if necessary, 
and Congress was to, as the bioterrorism acts, appropriate 
moneys to make sure it is done. Of the $160 million that has 
been allocated, plus there was an emergency supplemental after 
9/11 of $89, so about $240 million, $250 million, we have a lot 
of assessments that the expert says it isn't worth the paper it 
is written on and no corrective action since then.
    Mr. Gillmor. You and I are basically the spokesmen, Mr. 
Stupak, for dueling staff assessments, and the assessment that 
I am getting was that EPA asserted that authority before the 
passage of the act, but Congress didn't agree with that. But 
that is something we can get cleaned up at another time.
    I want to thank the members who have participated in the 
hearing. I particularly want to thank Mr. Grumbles and Mr. 
Stephenson for your usual very helpful testimony, and the 
meeting stands adjourned.
    [Whereupon, at 3:57 p.m., the subcommittee was adjourned.]
    [Additional material submitted for the record follows:]

Mr. John B. Stephenson
Director
Natural Resources & Environment
Government Accountability Office
441 G Street, NW
Washington DC, 20548
    Dear Mr. Stephenson: This is to express our appreciation to you for 
testifying before the House Energy and Commerce Subcommittee on 
Environment & Hazardous Materials on September 30, 2004 for the hearing 
entitled Controlling Bioterror: Assessing Our Nation's Drinking Water 
Security.
    Pursuant to the Chair's order, the hearing record remains open to 
allow Members to submit questions to witnesses. I would appreciate it 
if you could respond to these questions, and provide an electronic copy 
of your response no later than the close of business on Friday, October 
29, 2004, in order to facilitate the printing of the hearing record. 
The electronic copy (in Word or WordPerfect format) can be e-mailed to 
[email protected].
    Thank you again for your time and effort in preparing and 
delivering testimony before the Subcommittee.
            Sincerely,
                                  Paul E. Gillmor, Chairman
                Subcommittee on Environment and hazardous Materials
Attachment
      
    Question 1. According to an October 2003 report done for the Senate 
Committee on Environment and Public Works, GAO stated that security 
experts generally agree that decisions for allocating federal money for 
security improvements should be based primarily on (1) population 
density and (2) information contained in vulnerability assessments. 
Such efforts though could be complicated by Title IV's requirement that 
EPA develop protocols to protect from vulnerability assessments from 
disclosure to unauthorized individuals. As such, how do you square this 
recommendation with the requirements of the law?
    Response. As authorized reviewers of Vulnerability Assessments 
(VAs), designated EPA officials may examine submitted VAs, and could 
use them in making funding decisions and recommendations without 
compromising the requirements of Title IV. As a practical matter, 
however, such funding decisions would be realistic only at an aggregate 
level (e.g., for making judgments about the future direction of 
research, the types of training and their target audiences, and other 
technical assistance). As we noted in our report, the use by EPA 
officials of VA information to make--and defend--decisions about 
allocation among individual recipients could indeed be complicated by 
Title IV's requirement to protect VAs from disclosure to unauthorized 
individuals. Experts also cited other complications that would 
complicate utility-specific allocation decisions based on VA 
information. For example, several noted that even if access to 
vulnerability assessments was available, using VAs would require a high 
degree of interpretation on someone's part, and it's not altogether 
clear how such judgments would be made among potential recipients.
    Question 2. Based on your report, and recognizing the need for 
infrastructure funding, is it your opinion that some of this funding 
need for security enhancements should go through ratepayer increases, 
especially recognizing the current under-valuation of drinking water? 
Do you think it's reasonable to make local communities bear some of the 
costs in making these security upgrades?
    Response. The degree to which the federal government supports 
utility efforts to improve security is a policy decision to be made by 
the Congress and the Administration. Our report sought advice on the 
most efficient ways to allocate and spend federal funds should they be 
appropriated. As a practical matter, many utilities are already 
financing at least some of their security upgrades by passing along the 
costs to their customers through rate increases. We would expect 
ratepayers to continue to shoulder much of these costs in the future. 
It is also worth noting that in responding to the question concerning 
desirable financing mechanisms, our experts voiced strong support for 
cost-sharing between the utility and the federal government, lending 
further weight to the notion that improved utility security is in large 
part a local responsibility.
    Question 3. Your report recognized the physical assets of the 
distribution system as the single most important vulnerability of all 
system components. Recognizing the infrastructure needs of drinking 
water utilities and how the physical deterioration of pipes and 
transmission systems can lead to security vulnerabilities, do you agree 
with EPA that some SRF money helps improve security?
    Response. As a financing mechanism, use of the SRF for security 
enhancements did not rank as high as a number of other mechanisms 
identified by our expert panel. Nonetheless, the majority of experts 
did site the Fund as either ``very effective'' or ``somewhat 
effective'' as an approach for distributing funds. Moreover, one would 
expect the SRF to be particularly appropriate in circumstances--as 
suggested in the question--in which addressing basic infrastructure 
needs (``physical deterioration of pipes and transmission systems'') 
can, at the same time, address security-related concerns. The 
efficiency of this ``dual use'' concept has been widely accepted at 
EPA, among the experts on our panel, and elsewhere.
    Question 4. In your opinion, and based on your report, can the 
three categories of security-enhancing activities: physical and 
technological improvements, education and training, and strengthening 
operational relationships; be achieved or strengthened without further 
congressional action? What is your assessment of how likely the 
utilities are to cooperate in this further action?
    Response. There is little doubt that some of these security-
enhancing activities would continue to take place without federal 
funds, and our report documents a number of utility initiatives to 
pursue some of them. At the same time, our work suggests, at least 
anecdotally, that the degree to which some of these enhancements are 
implemented will be a function of the level of federal support 
provided. For example, the experts overwhelmingly cited the use of 
real-time monitoring technologies as the single most important physical 
security enhancement that can be applied to drinking water facilities. 
However, many of the experts noted that smaller utilities would simply 
be unable to deploy these technologies without federal support. In 
addition, while regional collaboration is taking place within some 
states as our report noted (BASIC in the San Francisco area and MADIRT 
in North Carolina), there may be a need for federal attention to 
encourage collaboration in broader regions of the country.
    Question 5. Recognizing the fact that the vulnerability assessment 
information is highly protected in order to protect sensitive 
information about each utility from those who may use the information 
to harm the utility, how, in your opinion and based on your study, is 
it possible to adopt security measures that both address 
vulnerabilities and mitigate the consequence of attack?
    Response. The requirement for vulnerability assessments helps to 
ensure that each utility goes through the systematic process of 
identifying its vulnerabilities and, by extension, developing plans to 
address those vulnerabilities through the addition of preventive 
measures and response plans. In that sense, the secrecy imposed on 
vulnerability information by Title IV does not necessarily prevent 
utilities from adopting security measures that address vulnerabilities 
identified by their VAs.
    Question 6. Recognizing that the primary mission of the Drinking 
Water SRF is to facilitate compliance with federal drinking water 
regulations and that this requirement alone makes the competition 
fierce and the funds scarce, do you believe that the drinking water SRF 
should be used as a main funding source for security enhancements at 
drinking water utilities?
    Response. For the reasons cited in the question, we believe it 
would be inappropriate to rely on the SRF as a main source of funding 
for security enhancements, particularly if supplemental funding was not 
provided to the SRF specifically for this purpose. As noted in response 
to question #3, few of the experts on our panel supported the SRF as a 
primary source of funding for security enhancements, with some citing 
the competing demands already placed on the Fund for its primary 
purpose of funding basic infrastructure improvements.
    Question 7. There is interest in the development and deployment of 
technologies that can detect contamination at the various stages of the 
community water system's intake valves, treatment plant, and delivery 
network. What is the status of these activities? How helpful will real 
time monitoring technologies, capable of providing near real time data 
for a wide array of potentially harmful water constituents, be in 
addressing security issues and why do you think this technology 
received the most support for federal funding than any other category?
    Response. The development and deployment of advanced monitoring 
technologies are still in their early stages, according to EPA's 2004 
``Water Security Research and Technical Action Plan.'' The Plan speaks, 
for example, of the continuing need to develop monitoring technologies 
for biological, chemical, and radiological contaminants and threats; 
and of the need to develop ``drinking water early warning systems.'' 
The development and deployment of such technologies received the widest 
support of any single security-enhancing activity cited by our expert 
panel for the reasons cited in the question--they hold great promise in 
providing real-time data for a wide array of potentially harmful water 
contaminants. This capability is particularly crucial in the water 
distribution system: once a contaminant is introduced at this late 
stage, there is little protection between a potentially deadly 
contaminant and an unsuspecting public. In such a situation, time to 
alert unsuspecting consumers would be of critical importance, and a 
real-time monitoring capability may be the only option to provide that 
time.
    Question 8. Recognizing the fact that drinking water distribution 
systems are so vulnerable due to their accessibility at so many points, 
do you envision the magnitude of the risk ever reaching a point where 
these systems could be fully and adequately protected? While water 
utilities have all assessed their vulnerabilities?
    Response. It is hard to imagine a scenario in which all drinking 
water systems could be ``fully and adequately protected.'' We believe, 
however, that well-conceived and properly funded security-enhancing 
strategies can help considerably to maximize deterrence against an 
attack; improve early detection should an attack take place; and 
improve response capabilities to help mitigate an attack's impacts. We 
also see value in encouraging utilities to revisit and upgrade 
vulnerability assessments over time; threats will likely change over 
time as will the strategies available to address deterrence, detection, 
and response.
                                 ______
                                 
                       U.S. Environmental Protection Agency
                                    Office of the Inspector General
The Honorable Paul E. Gillmor
Chairman
Subcommittee on Environment and Hazardous Materials
Committee on Energy and Commerce
U.S. House of Representatives
Washington, DC 20515-6115
    Dear Mr. Chairman: Enclosed are responses to questions for the 
record stemming from the September 30, 2004, hearing ``Controlling 
Bioterror: Assessing Our Nation's Drinking Water Security.'' We 
appreciate the opportunity to comment on this important issue. If your 
staff should have any questions on these responses, please contact 
Eileen McMahon, Assistant Inspector General for Congressional and 
Public Liaison, at (202) 566-2391.
            Sincerely,
                                                   Nikki L. Tinsley
Enclosure

              RESPONSES TO QUESTIONS FROM CHAIRMAN GILLMOR
    Question 1: In your report entitled ``EPA Needs to Assess the 
Quality of Vulnerability Assessments Related to the Security of the 
Nation's Water Supply Report No. 2003-M-00013 Dated September 24, 
2003,'' you cited that water systems did not consider the terrorist 
threat or distribution systems when undertaking their vulnerability 
assessments. Please clarify whether this conclusion was made before or 
after you were granted access to the vulnerability assessments. If the 
conclusions were drawn before you had access to the vulnerability 
assessments, would your conclusions change following your access?
    Answer: We want to clarify that we did not state in our report that 
water utilities failed to consider terrorist threats or distribution 
systems when undertaking their vulnerability assessments. We reported 
in EPA Needs to Assess the Quality of Vulnerability Assessments Related 
to the Security of the Nation's Water Supply (Report No. 2003-M-00013), 
dated September 24, 2003, that ``based on our interviews, we believe 
that vulnerability assessments submitted may emphasize traditional, 
less consequential, and less costly threats, such as vandalism or 
disgruntled employees. Therefore, vulnerability assessments may not 
necessarily address terrorist scenarios or the events of 9/11 that 
motivated passage of the Bioterrorism Act.'' (emphasis added) We based 
our conclusions on interviews with water security experts, EPA 
officials, and water utility personnel we talked with prior to gaining 
access to the vulnerability assessments. While the Act prohibits us 
from publicly discussing the information we obtained from the 
vulnerability assessments, the statements contained in our report 
remain valid.
    Question 2: In your report entitled ``EPA Needs to Assess the 
Quality of Vulnerability Assessments Related to the Security of the 
Nation's Water Supply Report No. 2003-M-00013 Dated September 24, 
2003,'' you stated that neither the Bioterrorism Act nor EPA identified 
a minimum threat level against which water utilities should assess 
their vulnerabilities. However, this statement did not take into 
account that baseline threat information for vulnerability assessments 
of community water systems was the topic of an extensive stakeholder 
meeting where a wide variety of members from the water industry, 
including large systems, utilities, municipalities, and rural systems 
were represented. The consensus at the meeting was that the design 
basis threat selection should be left to individual utilities to 
account for the uniqueness of each water system while incorporating the 
threat information gained from local FBI offices and other security 
experts. How then do you suggest a federal standardized threat level in 
light of this evaluation, recognizing the inherent differences in 
community water systems nationwide?
    Answer: As we reported, ``neither the Bioterrorism Act nor EPA 
identified a minimum threat level against which water utilities should 
assess their vulnerabilities.'' Water security experts, including staff 
from Sandia National Laboratory (the contractor EPA used to develop one 
of the vulnerability assessment methodologies), support our conclusion 
that EPA should have set a minimum threat level against which utilities 
needed to assess their vulnerabilities. According to Sandia officials, 
EPA's practice of not setting minimum security measures left threat 
determinations open to interpretation, and thus inconsistent 
application of the vulnerability assessment methodology. For example, 
one water security expert contracted to conduct several large utility 
assessments said that, even after vulnerability assessment training 
conducted subsequent to the terrorist attacks on 9/11, water utilities 
tended to focus on vandals, criminals, and disgruntled employees.
    Furthermore, in our report, Survey Results on Information Used by 
Water Utilities to Conduct Vulnerability Assessments (Report No. 2004-
M-0001), dated January 20, 2004, state and local auditors found that 10 
of the 16 water utilities utilized the Federal Bureau of Investigation 
(FBI) as a source of threat information, and only 3 of the utilities 
found FBI's threat information useful.
    While we agree about the uniqueness of the vulnerabilities of each 
water system, even if EPA required utilities to assess threats at a 
standardized level, the utilities still had the flexibility to decide 
whether or how to protect against any vulnerability identified.
    EPA's actions subsequent to the issuance of our report support our 
conclusion that EPA should have set a standardized threat level even in 
the face of unique utility characteristics. First, during an April 2004 
interview with our team, an EPA official described the Agency's plans 
to conduct 60 threat scenario-driven emergency response field exercises 
across the country including training on ``model emergency response 
plans'' for utility consideration. Second, during an April 2004 
meeting, a senior official from EPA's Water Security Division described 
the Agency's initiative to identify best security practices ``since the 
water industry has very little standards for security.'' EPA based its 
initiative to develop minimum guidance on security enhancements on a 
utility's size (e.g., fence height, the need for intrusion alarms) and 
EPA will vary guidance for rural/small water systems since they face 
different security issues. Moreover, regional EPA staff with access to 
the vulnerability assessments believe that utilities still have not 
made the cultural leap to considering terrorist scenarios rather than 
focusing on fencing and lighting as response mechanisms. Finally, EPA 
formed a Water Security Working Group charged with: (1) identifying, 
compiling, and characterizing best security practices and policies for 
drinking water utilities; (2) considering mechanisms to provide 
recognition and incentives to implement them; and (3) considering 
mechanisms to measure the extent of implementation of these best 
security practices and policies.