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

              ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR 2004

                                  ----------

                                               Thursday, March 6, 2003.

                             BUREAU OF RECLAMATION

                                   WITNESSES

    GALE A. NORTON, SECRETARY, DEPARTMENT OF THE INTERIOR
    JOHN W. KEYS, III, COMMISSIONER, U.S. BUREAU OF RECLAMATION

                          Mr. Hobson's Opening Remarks

        Mr. Hobson. The hearing will come to order.
        This morning we are pleased to have with us the Secretary
    of the Interior, the Honorable Gale Norton. She is accompanied
    by the Honorable John Keys, Commissioner of the Bureau of
    Reclamation, and Mr. Ron Johnston. And we would like to welcome
    the staff you have brought with you. It is good to see you
    again. Thanks for all the things you have done for my district.
    In the park at Wright Patterson, we are celebrating the Wright
    Brothers. That is where they really learned to fly an airplane.
    I don't know if there is anybody here from North Carolina or
    not.
        Madam Secretary and Mr. Keys, as you know, I am new to the
    subcommittee and, as you know, I am from Ohio. So I am not
    really familiar with all of the things that I need to be, or
    understand the programs of the Bureau of Reclamation. But I
    think with your help and the help of the more experienced
    colleagues that are on this committee and the staff, we will be
    able to, I think, develop a very good relationship among all of
    us.
        As a start, I had a very informative meeting with the
    Commissioner in my office last week. I also hope to be able to
    travel to the West to see the challenges you face firsthand. I
    look forward to working with you this year as we move through
    the appropriations process. The President's budget request has
    presented great challenges to this panel and we are going to
    need your help if we are to have a successful year.
        Let me say one other thing, and I am going to probably say
    this in most of the hearings, and the members will probably get
    tired of this before it is over. But the way I tend to look at
    projects is, one, whether we can do them; two, whether they are
    needed; and, more importantly, would I spend this money if I
    were running a business and it was my money that was coming out
    of my pocket. Would I want to do this project and would the
    people and the taxpayers benefit from it if we do it? And so
    you will find me looking at things maybe a little differently.
    I am a small businessman by background. I am still in business,
    and it drives me nuts at some of the things I see when we deal with
    taxpayers' dollars.
        At this point I would like to recognize my Ranking Member,
    Mr. Visclosky, for any opening remarks he would like to make.
        Mr. Visclosky. No opening statement. Thank you, Mr.
    Chairman.
        Mr. Hobson. Okay. Madam Secretary, the Chair recognizes
    you. We will place your prepared remarks in the record, and you
    may summarize as you wish.
        Just so you understand how we will do this, we will go 5
    minutes to each of the members, and do a round. I don't know
    what your time is, but I have a meeting at 11:30 with the big
    Chairman, and I think I ought to show up for that at some
    point. So if we are still going, I will probably let Mr. Wamp
    run the meeting, as long as he doesn't get out of hand, and I
    am sure he won't.
        So with that, we will allow you to move forward and make
    any comments that you would like.

                       Secretary Norton's Opening Remarks

        Secretary Norton. Thank you very much, Mr. Chairman and
    members of the committee. I am very pleased to be here today to
    describe our budget proposal for fiscal year 2004. I want to
    say I had a wonderful visit to Wright Patterson and to Dayton
    to see some of our facilities and the Air Force facilities. I
    am really looking forward to our Wright Brothers centennial
    celebration this year.
        Mr. Hobson. Thank you for coming.
        Secretary Norton. There are some great things underway. I
    am very pleased to see that you are making plans to come see
    some of our facilities for the Bureau of Reclamation. We
    welcome that and look forward to having a chance to show you
    around.
        As you mentioned, I am joined today by Commissioner Keys. I
    also would like to introduce John Trezise, who is the
    Departmet's Budget Director. Ron Johnston of the Central Utah
    Project is here in the audience with us today.
        The Department of the Interior's responsibilities lie at
    the confluence of people, land, and water. Our programs touch
    the lives of individuals across the Nation. How well we fulfill
    our mission influences whether farmers will have water and
    people can turn on the tap; whether our children will enjoy
    America's grand vistas, places, and history; and whether future
    generations can hike, bird watch, canoe, or hunt and fish in
    the great American outdoors.

                                budget overview

        The 2004 budget request lays the foundation for us to build
    a legacy of healthy lands and thriving communities. Our 2004
    budget request is $10.7 billion. This is the largest
    Presidential request in the Department's history, sustaining a
    25 percent increase over the 2000 budget.
        The Department anticipates that on the receipts side, it
    will collect $7.8 billion in revenue in 2004, equivalent to 73
    percent of our appropriations request.

        Our 2004 request for the programs that are covered by this
    subcommittee amount to $916.2 million. This includes $878
    million for the Bureau of Reclamation and $38 million for the
    Central Utah Project Completion Act.
        Through its water infrastructure, the Department provides
    drinking water to 31 million people and irrigates lands that
    provides 60 percent of the Nation's fruits and vegetables.
    Reclamation is the largest supplier and manager of water in the
    17 Western States and is also the Nation's second largest
    producer of hydroelectric power.
        With the responsibility to continue to meet western water
    needs, we need to find ways to manage water carefully and
    creatively for people, land, and the environment. This year, we
    face some tremendous challenges with the drought that is
    affecting much of the Western United States. We are still
    watching what develops to determine exactly how severe the
    drought is going to be, but the preliminary indications are
    very disturbing.
        I talked last week at the National Governors Association
    meeting and spoke independently with the Governors of Nebraska
    and Kansas. Both independently volunteered the observation that
    this appeared to be the driest year since the dust bowl. Kansas
    and Nebraska are only two of the many States that are affected,
    and other States are appearing to have even deeper levels of
    drought than those States. Lake Powell, for example, is
    currently nine stories below its high point. Across the West we
    are going to face tremendous challenges because of that.
        The budget requests include $11 million to launch a Bureau
    of Reclamation Water Initiative that uses collaboration,
    conservation, and innovation to make sure every drop of water
    counts. Our 2004 Water Initiative will benefit communities
    currently struggling with increased water demands, drought, and
    compliance with the Endangered Species Act. This initiative
    will help us to reduce the conflicts over water, meet important
    water needs for people and for the environment, and improve our
    ability to integrate our activities with State, local, and
    private partners.
        With investments in water conservation, science, and
    technology, and modernization of existing facilities, we will
    manage water more wisely. The kinds of activities that this
    funding will support include overall looking at ways to enhance
    our overall use of water and to use it more wisely. We will
    examine, for example, allowing others to use excess storage
    capacity so that water is available to local communities when
    they need it. We will examine the improvements that can come
    from updating irrigation practices. In many parts of the
    country, the irrigation practices are the same as they were 200
    years ago. By lining canals, and by using more sensitive
    headgates and other monitoring approaches, we can reduce water
    losses. We want to increase research on desalinization to bring
    down the long-term costs so that we can convert salt water to
    fresh water and have that provide additional water capacity,
    both on the oceanfront and across the country. We also believe
    it is important to strengthen the understanding of the
    Endangered Species Act within the Bureau of Reclamation, and
    that is a part of this initiative as well. Overall, the water
    initiative will allow us to address long-term needs and lay the
    foundation for addressing the increasing water needs for the
    country.
        In addition to our Water Initiative, the Reclamation budget
    puts an emphasis on resolving water management and delivery
    issues that involve endangered species in several Western
    States. This includes nearly $21 million for the Klamath
    Project where Reclamation will improve water supply and water
    quality. To improve water supply, we will establish a water
    bank and evaluate opportunities to increase storage in the
    basin. Water banking is an important tool in addressing both
    temporary and permanent transfers of water to protect
    resources, while supporting local water needs and preserving
    the economic base of communities. In establishing the water
    bank, Reclamation will work with local water users and private
    landowners to provide water for fish and to protect existing
    water uses in the basin through a market-based approach.

                           SPECIFIC PROJECT PROPOSALS

        Now let me run through some of the specific project
    proposals. Reclamation's budget includes $19 million for the
    Columbia/Snake salmon recovery project, and $17 million for the
    Middle Rio Grande project, to work collaboratively with other
    stakeholders to manage water while promoting endangered species
    recovery.
        The budget includes $15 million in an account established
    exclusively for implementation of the preferred program
    alternative for the CALFED Bay-Delta Program.
        The budget request includes $58 million to continue
    construction of the Animas La Plata Project. This is the level
    of funding that is needed to meet the construction schedule
    contained in the Colorado Ute Settlement Act Amendment of 2000.
        The 2004 budget request includes $34 million for payment to
    the plaintiffs in the settlement of the Sumner Peck Ranch
    litigation. Just yesterday, we learned that the Department of
    Justice has concluded that it is appropriate to pay the $34
    million annual payment for 2003, plus the $5 million upfront
    payment from the Judgment Fund.
        Lastly, let me discuss the budget request for rural water
    projects. Our budget includes $32 million for these projects.
    This is significantly reduced from the level Congress recently
    enacted for 2003. The 2004 request reflects the findings of the
    OMB program assessment rating tool process. The assessment
    evaluated the program in its entirety and did not evaluate
    individual projects funded in this program. The program
    assessment rating tool process concluded that a new approach is
    needed for the program. We intend to submit legislation this
    spring establishing a Reclamation Rural Water program with
    adequate cost controls and clear guidelines for project
    development.
        The 2004 budget for the Central Utah Project Completion Act
    is $38.2 million, an increase of $2.2 million over $2003. This
    focuses on redesign and realignment of the Diamond Fork Tunnel.

                      OVERALL DEPARTMENT BUDGET PRIORITIES

        I would like to quickly run through a few of the other
    budget priorities for the Department overall to help you put in
    context our requests for the Bureau of Reclamation in this area
    as compared to the rest of the Department. Homeland security is
    obviously an important concern for us as well as for everyone
    else in the Federal Government, and security at our dams is one
    aspect of our improvements in homeland security.

                            TRUST REFORM INITIATIVES

        The largest portion of the increase in our budget is for
    trust programs. In the Department's budget overall, we provide
    an increase of $183 million for trust programs and this is an
    increase of nearly 50 percent over last year. This is necessary
    because of the need to do an historical accounting of Indian
    trust fund management. There is a dispute in litigation about
    whether the Federal Government owes billions of dollars or
    whether our accounting was far less flawed. That dispute can
    largely be resolved only by going through an accounting
    process. We have laid out to the court a proposal for how we
    can do that. That is, overall, about $350 million in accounting
    over the course of several years. We anticipate going forward
    with that.
        Mr. Hobson. For the accounting?
        Secretary Norton. Yes. It is basically to go back and
    reconcile our bank statement.
        Mr. Hobson. $350 million?
        Secretary Norton. That is correct. This would have us going
    through the major transactions one by one, plus doing
    statistical sampling of the lower value transactions. This is
    down from the estimate of $2.4 billion to do a transaction by
    transaction accounting of all of those accounts.
        Mr. Hobson. I would like to have some discussion at some
    time about what that is.
        Secretary Norton. All right.
        Mr. Hobson. Not now.
        Secretary Norton. All right. I would be happy to talk with
    you further.

                      COOPERATIVE CONSERVATION INITIATIVE

        We also have put forward a Cooperative Conservation
    Initiative. This allows us to lay the foundation for healthy
    lands. It presents a blueprint for fulfilling the President's
    vision of a new environmentalism of citizen-stewards and
    cooperative conservation. This program will tap into the
    tremendous potential that resides in conservation partnerships.
    It will better enable our land managers to join with Americans
    across the Nation in caring for the land.
        Thousands of landowners and organizations remain on waiting
    lists to participate in our Cooperative Conservation Grant
    Programs. The 2004 budget includes $113 million for the
    Cooperative Conservation Initiative. It includes, for example,
    an increase of $9.3 million for the Partners for Fish and
    Wildlife program. This will allow us to partner with 2,500
    landowners to restore wetlands, uplands, riparian habitats, and
    many other areas through voluntary, cooperative agreements.
    These programs, I am realizing, are very relevant to the
    programs that this subcommittee addresses as well. As we can
    resolve environmental problems in specific watersheds by
    working with the people in those communities, we can help stretch
    the water that is available through our  Reclamation projects. We
    believe that this type of cooperative conservation approach can
    help us in addressing water needs as well as other environmental
    issues for the long term.

                         OTHER DEPARTMENTAL INITIATIVES

        Our programs are also interrelated in other ways. Our Fish
    and Wildlife Service Program for fish hatcheries is being
    increased this year. Our Healthy Forest Initiative protects
    watersheds. It, for example, will involve the removal of salt
    cedar in some areas. Salt Cedar is a plant that absorbs
    tremendous amounts of water from riverfronts in arid areas. Our
    programs can have impacts in ways that we might not usually
    think by allowing these programs to work together. We are
    trying to do more analysis and cooperation to be sure that we
    are using our programs in a coordinated way to address our
    needs.
        I would like to thank you for the opportunity to be here
    today and to discuss our budget. We are working to manage
    better through partnerships. Our ability to leave a legacy of
    healthy lands and thriving communities depends on how well we
    all work together. Our 2004 budget sets forth the tools through
    which partnerships can flourish. Thank you.
        [The prepared statement of Secretary Norton follows:]

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

                       Commissioner Keys' Opening Remarks

        Mr. Keys. Mr. Chairman, it is my absolute pleasure to be
    here with you today to talk about the Bureau of Reclamation
    2004 budget request for what we are trying to do in the Western
    United States. I have with me today Bob Wolf, who is our
    Director of Program and Budget for Reclamation, to help me
    answer any questions you may have.
        We certainly appreciate the support the subcommittee has
    given us in the past and we certainly look forward to working
    with you in the future. Your staffs are first class and we have
    had an excellent relationship in working with them, and we
    would certainly work to keep that underway.
        Mr. Chairman, this year we are celebrating the centennial
    year for the Bureau of Reclamation. We were established in 1902
    on June 17 by an act signed by President Roosevelt, and we are
    proud of what Reclamation does in the Western United States.
    Currently, we are the largest wholesaler of water in the United
    States, the seventh largest power utility, and we serve water
    daily to about 31 million people in the Western United States,
    and annually we serve about 10 million acres with irrigation
    water. Overall, we have 348 major dams and 58 power plants in
    the 17 Western States.
        Mr. Chairman, the overall Bureau of Reclamation request is
    $878 million in current authority, and from our perspective,
    this budget is good news for the Western United States. The
    request is citizen centered and founded on the President's
    principle of results rather than procedures.
        An example is the Western Water Initiative request that the
    Secretary talked about earlier. Our budget is fiscally
    responsible. We will continue to provide funding to deliver
    water, provide a stable source of power for our growing
    population, keep our dams and facilities safe, and support
    sound environmental stewardship efforts all across those 17
    Western States.
        The Fiscal Year 2004 Request for Water and Related
    Resources is $771 million. This will allow us to continue
    Reclamation's emphasis on delivering and managing water and
    power, two valuable public resources that we are responsible
    for managing.
        In cooperation and consultation with the States, tribal,
    and local governments, along with other stakeholders and the
    public at large, Reclamation offers workable solutions
    regarding water and power resource issues that are consistent
    with the demands for water and power over the West. With the
    need to pursue cost-effective, environmentally sound approaches
    to meeting these demands, the request continues to emphasize
    the operation and maintenance of Reclamation facilities in a
    safe, efficient, economic, and reliable manner. This is all
    done while sustaining the health and integrity of ecosystems
    that address the water needs of a growing population.

                         HIGHLIGHTS OF THE 2004 PROGRAM

        Several highlights of the 2004 program, and these are not
    in any specific order:
        The Secretary mentioned the Animas La Plata funding. The
    funds that are requested will continue with the construction of
    Ridges Basin Dam and the Durango pumping plant that we are well
    into construction on now. It will also allow us to do the
    preconstruction work on the Navajo Nation municipal pipeline.
        The work in the Klamath Basin that was mentioned before has
    a very unique feature that we are working mightily on this
    year, and that is creating a water bank that would set water
    aside from fallowed land on a willing seller/willing buyer
    basis, that would set this water aside to help meet the
    Endangered Species Act requirements of the project and, at the
    same time, allow the water supply of the basin to be managed
    for irrigation delivery. We think it has great promise and a
    lot of the monies that you see there are directed toward making
    that happen.
        The safety of Reclamation dams is one of our highest
    priorities. About 50 percent of Reclamation's dams were built
    between 1900 and 1950. Ninety percent of these dams were built
    before the advent of current state-of-the-art foundation
    treatment and before filter techniques were incorporated in
    embankment dams to control seepage. That is the primary focus
    of our Safety of Dams Program in making them safe and reliable
    for years to come, centuries to come, in most cases. We have
    about $71 million in our budget for that.
        Our site security activities are ongoing and funding
    program improvements are also ongoing, identified in 2002 and
    2003. Since September 11, 2001, Reclamation has maintained
    heightened security at all of those facilities to protect the
    public, our employees, and the infrastructure. Our budget
    request is about $28.5 million for that.
        The desalinization of seawater and groundwater poses a
    promising opportunity to expand water supplies for both coastal
    and inland areas in the Western United States. The 2004 budget
    contains increased funding for desalinization research
    activities aimed at decreasing the cost and facilitating local
    implementation of desalinization. We believe that cost-shared
    research conducted at existing institutions is the quickest and
    most economical means to achieve our ambitious, long-term goal
    of decreasing desalinization costs by 50 percent by the year
    2020. Without continued investments in desalinization research,
    the future expansion of the Nation's water supplies could be
    jeopardized.
        Mr. Chairman, the Secretary talked about our Western Water
    Initiative that we are trying to get started. We are excited
    about that because it brings focus on those areas that we see
    the greatest promise for dealing with the challenging water
    resource management issues that we anticipate in the next 25
    years.
        Mr. Chairman, we have a lot of details in our proposals. We
    certainly would try to cover some of those details with you
    today if you would like, and would certainly stand to any
    questions that you may have.
        Mr. Hobson. Thank you for the summary. Rodney was worried
    you were going to read the whole thing and he was getting a
    little nervous.
        Mr. Frelinghuysen. I was.
        [The prepared statement of Commissioner Keys follows:]

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        Mr. Hobson. At this point, we'll put the budget
    justification material for the Central Utah Project and the
    Bureau of Reclamation in the record, without objection.
        [The information follows:]

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

        Mr. Hobson. We will, as I said before, use the 5-minute
    rule and go by order of people who arrived first.
        Mr. Edwards.

                          Mr. Edwards' Opening Remarks

        Mr. Edwards. Thank you, Mr. Chairman.
        The first question, Mr. Chairman, is actually to you. Mr.
    Pastor wanted to know if the Wright Brothers explained why they
    left Ohio.
        Mr. Hobson. They came back. In North Carolina they didn't
    want to learn to fly the airplane, they just wanted to see if
    they could take off in the heavy winds.
        Mr. Edwards. Commissioner, Madam Secretary, thank you for
    being here and for the important work you do.

                                  DESALINATION

        Let me just ask a question about desalinization. Are there
    many lakes throughout the Western U.S., or the entire U.S.,
    where the water simply isn't drinkable because of the salinity?
    I have a lake in my district in central Texas that is like
    that, and we are interested in learning more about what the
    possibilities are for desalinization. Is that a major potential
    new water source, without having to build new dams, or are
    there just a small number of lakes like that?
        Secretary Norton. We, of course, have many different
    situations. I would say the more likely possibility for major
    water sources is from groundwater. In terms of the lakes that
    tend to be heavily saline, those, for example, are too saline
    to be easily processed, and so the cost is higher the more
    salinity that is already in the water.
        Mr. Edwards. Right.
        Mr. Keys. Mr. Chairman, what we are hoping to do is to
    refine the technology so that whatever the saline source is, we
    can treat it. Currently the cost of treating saline water or
    seawater is about $650 an acre-foot. Economic studies show that
    if we can get that cost below $600, it is competitive in some
    of those high-cost water markets. Certainly our program will
    focus on seawater and the brackish groundwater. But getting the
    cost of that technology down, the filter technology that is
    associated with reverse osmosis, if we can get that cost down,
    you might say the sky is the limit on where you go and try to
    find sources to treat.
        Mr. Edwards. You have $775,000 in direct line item funding
    for that type of research, but I assume you also have some
    research built into your other projects. Did you give,
    Commissioner, the total number for desalinization research or
    efforts in the budget? You took all different sources?
        Secretary Norton. While he is looking for that, I also note
    that many other departments are doing research, and we would
    like to work with them to coordinate that research. The
    military does desalinization for the Navy ships. It is
    something that is being looked at for international use, and so
    there are a number of other departments working on that.

        Mr. Hobson. Are you a partner in the Long Beach
    Desalinization Program? Because there is a claim there that
    they have got it to $600 or under. Are you involved in that?
        Mr. Keys. Mr. Chairman, we are working very closely with
    Long Beach and they have a new filter technology that they are
    investigating. Their cost is under $600 right now because of
    the subsidy that the Metropolitan Water District puts toward
    any water that is developed from desalinization. We are still
    trying to get the overall cost of it down below $600.
        Mr. Edwards. Great. That addresses it. I will follow up
    with written questions and perhaps some meetings. I would like
    to learn a little bit more about the whole issue.
        Mr. Chairman, thank you.
        Mr. Hobson. Mr. Berry.

                          Mr. Berry's Opening Remarks

        Mr. Berry. Thank you, Mr. Chairman.
        Madam Secretary, I appreciate you being here today. I have
    got just a whole list of questions. But rather than go into
    those here today, I have repeatedly asked your office for a
    meeting with you and some of your folks at the Department of
    the Interior, but I have just not been able to achieve that. I
    think it would probably save everyone time if you and I could
    just sit down and talk about some of these things.
        I have any number of Department of the Interior facilities
    in the district that I am fortunate to represent, and it is
    generally considered a curse, and that the worst thing that
    could happen to your community is for the Department of the
    Interior to establish something there.
        I would just really like to have the opportunity to sit
    down and talk to you about the problems that we have, not only
    from just abusing our local citizens, but to the Park Service
    denying safe, clean, drinking water to communities because they
    just do not want those communities to be close to their park.
    That is the sort of thing that we have to deal with. We have
    people, a whole county, 8,000 people, drinking radon-
    contaminated water because the National Park Service wants to
    run them out of there.
        So that is the kind of issue I would love to have the
    opportunity to discuss with you at your convenience. Thank you.
        Secretary Norton. I apologize. I just became aware that we
    did not reply to your most recent letter, so we will be in
    contact with you to arrange something.

        Mr. Hobson. Mr. Visclosky.

                        Mr. Visclosky's Opening Remarks

        Mr. Visclosky. Thank you, Mr. Chairman.

                      NORTHWEST AREA WATER SUPPLY PROJECT

        Commissioner Keys, I wrote to you about the Northwest Area
    Water Supply Project on January 23, and you were kind enough to
    respond on March 5th about the corrosion protection standards
    of the pipe that is going to be used on phase 1 of that
    project.
        Mr. Keys. Yes.
        [The information follows:]

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

        Mr. Visclosky. In your response--and it was a good
    assumption on your part, since I am from Gary, Indiana--the
    first two substantive paragraphs of the response talked about
    the use of ductile iron or steel pipe, and I appreciate that.
    But in the letter I wrote, I never mentioned the type of pipe--
    and I reread the letter during the hearing here--but did ask a
    series of eight questions, almost all of which pertain to the
    issue of corrosion protection and the amount that is called
    for.
        In your letter of March 5 you did state in the fourth
    paragraph that ``Regarding the matter of corrosion protection
    and service life, the Northwest Area Water Supply
    specifications meet or exceed the industry standard.''
        That was not my question. My question was, what about your
    standards? Because the pipe, as I understand it, that is going
    to be used is 36 or 30 inches in diameter.
        Mr. Keys. Mr. Chairman and Mr. Visclosky, before those
    specifications were issued, we approved those specifications,
    so the specs do meet our Reclamation requirements for corrosion
    protection.
        Mr. Visclosky. They meet your requirement. Do they meet
    your standard as published? I know they meet the industry
    standard, I know they meet your standard for this project. Do
    they meet your written criteria as far as the Bureau of
    Reclamation standards for pipe of 25 inches or more in
    diameter?
        Mr. Keys. Mr. Chairman and Mr. Visclosky, everything that I
    have found in that thing says yes.
        Mr. Visclosky. My understanding is that if pipe of 24
    inches or more is used, your standard for the Bureau of
    Reclamation specifies that it has to be--and excuse my
    pronunciation--cathodically protected and coated with a bonded
    coating. Is that correct or not?
        Mr. Keys. Mr. Chairman and Mr. Visclosky, there are several
    ways to do it.
        Mr. Visclosky. I didn't ask that. Is the United States
    Bureau of Reclamation standard, as published, to have that type
    of bonding and corrosion protection?
        Mr. Keys. Mr. Chairman and Mr. Visclosky, my understanding
    is that everything we did met our own standards.
        Mr. Visclosky. I didn't ask you that.
        Mr. Keys. I will get back with you on a more detailed
    answer to that. I did not understand the way you asked the
    question that--of what you are asking now, so we would
    certainly get back with you again.
        Mr. Visclosky. The question I asked on January 23rd was,
    what is the United States Bureau of Reclamation standard for
    corrosion protection, and what methods of protection are called
    for in your standards, recognizing that in your response in
    both writing and here today that you met industry standards and
    the standards for this project.
        The question I would have is, if you have a published
    standard and it was not followed, why have the standard in the
    first place? Secondly, what is the justification for a
    deviation from a published standard and, furthermore, since
    this is only phase 1 of this program, is there going to be a
    deviation, and why, from the standard as far as the bidding
    process in the future? My questions did not relate specifically
    to the type of pipe used.

        Mr. Keys. Mr. Chairman and Mr. Visclosky, I understood that
    our standards were followed in all of the specifications for
    the NAWS pipeline. I will go back and check and be sure that
    that is correct. My understanding is still that, but I will
    check further for you.
        Mr. Visclosky. My understanding is that the bidder whose
    bid was accepted is going to use a nonbonded baggie to cover
    the pipe and that this is outside of the United States Bureau
    of Reclamation standard for pipe over 24 inches in diameter.
        Mr. Keys. Mr. Chairman and Mr. Visclosky, our understanding
    is that that cathodic protection met our standards and was
    adequate for long-term protection. I will certainly ask again
    and we will get back with you.
        Mr. Visclosky. If you could. And in the response, you
    indicated that the Government of the Province of Manitoba had
    filed suit on this matter--not on the specific question I am
    asking, but on the project--on October 22nd, and that you have
    to be somewhat judicious in your formal correspondence. But
    given the fact that there is a lawsuit pending on this, I asked
    a series of eight very specific questions and do not feel that
    the responses were adequate.
        Mr. Keys. Mr. Chairman, Mr. Visclosky, we will do better
    next time.

                                 SITE SECURITY

        Mr. Visclosky. Commissioner, the Bureau of Reclamation's
    budget includes $29 million for security on 362 high and
    significant hazard dams that you operate. Does this budget
    request fulfill all of your security needs at these sites?
        Mr. Keys. Mr. Chairman and Mr. Visclosky, all of our dams
    are secure at this time. After September 11, 2001, we initiated
    a review of the security facilities and coverage at all of our
    facilities. The entire review for all 362 will be completed by
    the end of 2004. We are currently completing those on the top
    55 of those facilities and are in the process of implementing
    the hardware changes that have to be made at each facility. The
    monies that we have had in the past have been adequate for us
    to provide the security coverage there, the law enforcement
    coverage.
        We are, as we speak, putting together the changes
    physically that need to be made, the barriers, the closed
    circuit televisions, whatever it takes. Our monies are adequate
    to complete those reviews. We are now evaluating and
    prioritizing the on-the-ground fixes that have to be made.
        Mr. Visclosky. Okay. So after 2004, the reviews will be
    completed, but all of the security equipment upgrades would not
    necessarily be completed?
        Mr. Keys. That is correct.
        Mr. Visclosky. At this budget level.
        Mr. Keys. At this level we are working to see what needs to
    be done and as we find out what needs to be done, then we will
    program for those monies.
        Mr. Visclosky. Could you for the record provide the
    subcommittee with a list of the requirements that have been
    identified to date--understanding you may have additional items
    identified subsequently--but are not funded subsequent to the
    04 budget, if you could?
        Mr. Keys. Mr. Chairman and Mr. Visclosky, I am not sure
    about the security status of that information. What we would
    probably prefer to do is offer you a briefing in a secure
    situation so we could go through those requirements with you.
        Mr. Visclosky. Could you provide a classified list to the
    committee staff?
        Mr. Keys. Yes, sir, we could do that.
        Mr. Visclosky. If you could do that, that would be
    preferable.
        Mr. Visclosky. Thank you very much. Thank you, Mr.
    Chairman.
        Mr. Hobson. Mr. Frelinghuysen. But before that, could you
    tell us what the pin is that you are wearing?
        Mr. Keys. This is our centennial pin.
        Mr. Hobson. It looked to me like a turtle and I was worried
    that it was some sort of endangered species.
        Mr. Frelinghuysen. The motto is ``make haste slowly.''
        Mr. Keys. Mr. Chairman, actually--the pin appearing to be a
    turtle is a good one, because a turtle doesn't make progress
    until he sticks his neck out.
        Mr. Hobson. Very good response. That was good.
        Mr. Frelinghuysen. Is that subtracted from my time?
        Mr. Hobson. No.
        Mr. Frelinghuysen. Thank you, Mr. Chairman.

                      Mr. Frelinghuysen's Opening Remarks

        Secretary Norton, it is a pleasure to be with you once
    again. I am taking a page out of Mr. Hobson's initial remarks.
    I would like to invite you to New Jersey to my congressional
    district. This hearing traditionally, historically, is focused
    on western issues, but in reality, your Department throws its
    arms around a lot of things that are very important to people
    in the Northeast, as they are to the West. We have never viewed
    you, if you will pardon the expression, as a curse; we regard
    you in our part of the world as an ally as we try to protect a
    lot of natural assets.
        I have in my congressional district the oldest national
    historic park in the Nation and there is a lot that goes on in
    the New York/New Jersey/Pennsylvania region where your
    Department has been absolutely a tremendous ally. A lot of
    great professional people. I am sort of buttering you up in a
    sense because, having talked with you, I would definitely like
    to have you come and see the good things that your people have
    been involved in.

                              NEW JERSEY HIGHLANDS

        One of those has been a study which you and Secretary
    Veneman have done in the Department of Agriculture under the
    direction of the U.S. Forest Service, that I have been very
    much involved in. This is an update of a 1993 study of what is
    called the New Jersey highlands. But, in reality, it goes from
    the Delaware River, which would include Pennsylvania, through
    New Jersey, through New York State into Connecticut. These are
    parts of the country where, speaking on behalf of my own State,
    we have a huge density of population and a lot of what we love
    and hold dear in terms of open space and farmland is rapidly
    disappearing.
        This update of the 1993 study which your Department has
    actively been involved in has been completed and released. What
    we are waiting for are some recommendations from you and
    Secretary Veneman as to ways that we can work together. This is
    not the case that sometimes westerners see as sort of a land
    grab of the United States Government, as I have shared with
    you. In our area, we have willing sellers. We have communities
    that are keenly interested in preserving open space, and they
    have stepped up to the plate with their own financial resources
    and a lot of private groups have done it.
        So not only would I like to get you there, I would like to
    ask that when you work on your recommendations with Secretary
    Veneman that you consider our desire to protect more of that
    land, and hopefully, to be in a position to purchase it.
        Secretary Norton. Thank you. I do look forward to working
    with you on that. We have really focused on exactly the kind of
    project that you are talking about in developing our
    Cooperative Conservation Initiatives. We really applaud the
    locally driven approaches to address the conservation needs
    that local communities see. I think that many of the proposals
    that we have, and our existing programs, would be well suited
    to be parts of the mosaic of protections that would fit a very
    diverse area, as the highlands are.
        Mr. Frelinghuysen. And when we talk about water resource
    management in the East, while people tend to have forgotten it,
    we have had huge drought issues and water is our most valuable
    commodity. And a lot of what I am talking about represents
    watersheds and a variety of buried aquifers, and I think to the
    degree that your good people can work with people in New Jersey
    in our municipalities, we can do better to protect it. Thank
    you very much.
        Thank you, Mr. Chairman.
        Secretary Norton. Thank you.
        Mr. Hobson. Mr. Simpson.

                         Mr. Simpson's Opening Remarks

        Mr. Simpson. Thank you, Mr. Chairman.
        Madam Secretary, I appreciate you being here today. It is
    always good to see you again. Commissioner, it is good to see
    you again. I want to tell you that I think the Department is
    doing a great job out in Idaho, and we enjoy working with you.
    And I guess some of the people from Arkansas ought to come out
    and see the job they are doing in Idaho.
        Mr. Berry. We can swap with you.

                  TRUST RESPONSIBILITIES WITH NATIVE AMERICANS

        Mr. Simpson. While it isn't under the direct jurisdiction
    of this committee, I did appreciate your comments addressing
    the trust responsibilities that we have with the Native
    Americans. I know the Chairman is concerned about the cost, as
    we all are, but the potential costs are enormous, as you know.

        I see that your budget, as it looks to me in the budget
    book, and I am still trying to understand these, it says that
    the request for the payment in lieu of taxes is $50 million,
    but in your comments you say that there is $200 million in the
    President's request.
        Secretary Norton. It is $200 million. I am not sure exactly
    what it is that you are looking at.
        Mr. Simpson. This book.
        Secretary Norton. But it used to be that Payment in Lieu of
    Taxes, PILT, was funded entirely in the Bureau of Land
    Management. We have now moved PILT into the departmental budget
    because it really applies to the Forest Service and Park
    Service and so forth, as well as BLM, so it may be some of that
    movement to the departmental budget that is showing up there.

                                KLAMATH PROJECT

        Mr. Simpson. Okay. Commissioner, do you have any sense of
    what is going to happen in the Klamath Basin this year? I
    noticed that you talked about creating a water bank to try to
    address some of these problems on a willing-seller basis. My
    guess is that if what happened in 2001 happens in 2003, we are
    going to have a lot of willing sellers, just no water to bank.
    How is this going to work?
        Mr. Keys. Mr. Chairman and Mr. Simpson, it is going to be a
    tight water year there. As I think the Secretary said, our
    forecast right now shows that expected runoff in the basin is
    somewhere between 40 and 45 percent at this time.
        What we are trying to do with the water bank is for those
    people that are willing to idle their land this year and make
    that water available, is to set it aside and meet the
    endangered species requirements from that water bank. The rest
    of the water that is in storage and that runs off would then be
    available for use by the irrigators. It does not mean a full
    supply. There were shortages in the basin in 1992 and 1994, and
    if the current situation continues, there will be shortages
    there even as they operate that separate water supply this
    year. I have no idea what those shortages would be.
        The plan that we have put together, I think, gives us as
    good a chance as anything that we can think of to have a water
    supply this year without the 2001 conditions.

                                   IRRIGATION

        Mr. Simpson. On the Western Water Initiative, one of the
    goals in there is to improve irrigation techniques. I
    understand that a general number is that if you deliver water
    by a canal, generally half the water is used up and getting to
    the field. Is that about accurate?
        Mr. Keys. In some cases it is, where they have not taken
    specific actions to line the canals, to operate them so that
    they can minimize seepage. We have a number of programs that we
    have worked with over the years where we have encouraged people
    to line the canals, put in better operating facilities, put in
    SCADA systems; SCADA is a Supervisory Control and Data
    Acquisition Device that allows you to operate off site; better
    monitoring and measuring equipment and so forth.

        The initiative would try to bring more focus into that,
    pick some pilot projects out, and show some folks how some
    extra money put in there could stretch their existing water
    supply. Your figure on 50 percent depends on the facility. In
    Idaho you have most of canals and laterals not all of them, but
    a good share of them, already lined and probably do not lose
    that much water. Other facilities that are not lined could lose
    that much and sometimes even more water.
        Mr. Simpson. Well, would any of these funds be available
    for some grant programs to pressurize and deliver water? I know
    that for the Oakley Canal, they are talking about doing that,
    because they lose about 50 percent of their water.
        Mr. Keys. Well, Oakley Canal is not a Reclamation facility.
    Those, we would hope to encourage them to work with the
    Department of Agriculture who has several programs available to
    do that.
        Mr. Simpson. You do have some that may request this type of
    thing.
        Mr. Keys. For Reclamation facilities, that is correct.

                      COLUMBIA/SNAKE RIVER SALMON RECOVERY

        Mr. Simpson. We have in this budget about $19 million for
    salmon recovery in the Columbia/Snake River. Any idea on what
    the estimate of total cost on that is going to be?
        Mr. Keys. Mr. Chairman and Mr. Simpson, the $19 million is
    for Reclamation to participate in meeting our part of the
    requirements under the Biological Opinions that were signed in
    2000 and 2002. I have no idea what the total cost of the salmon
    recovery by the United States Government is in the basin.
        Mr. Simpson. Well, we are spending hundreds of millions of
    dollars on it every year.

                          LOAN PROGRAM ADMINISTRATION

        I would suggest that in your comments that you might want
    to change just one thing, and this is just a recommendation,
    because somebody is going to look at it and do what I did. And
    that is, under the loan program, you said no funds are
    requested for the loan program; but $200,000 are requested for
    the administration of it. Somebody is going to look at that and
    say, ``Oh, typical government program.'' I assume that is for
    grants that are already out there, loans that are already out
    there.
        Mr. Keys. Mr. Chairman and Mr. Simpson, that is absolutely
    right.
        Mr. Simpson. Thank you.
        Thank you, Mr. Chairman.
        Mr. Hobson. Mr. Pastor.

                          Mr. Pastor's Opening Remarks

        Mr. Pastor. Thank you, Mr. Chairman. Good morning, Madam
    Secretary and Commissioner. Good seeing you again.

                          SECURITY COSTS AT HOOVER DAM

        Last year one of the areas I was interested in was the
    security costs, and we talked about Hoover Dam, the visitors
    center. Since 9/11, how much money, ballpark figure, has been
    spent, just on the security of our Federal facilities by the
    Bureau of Reclamation?
        Mr. Keys. Mr. Chairman and Mr. Pastor, since 2001,
    September 11, 2001, our 2002 budget for that was about $30
    million; Our 2003 figure is $26 million; and our 2004 request
    is for $28 million. Those are monies that are being spent on
    the security reviews of all of the facilities; the hiring and
    providing of security and law enforcement people at the dams.
    So in 2002, 2003, and 2004, that is about $84 million.
        Mr. Pastor. And the question, or the response, is that
    after the 2004 review, we will talk about upgrades not
    completed at the ground level. I heard that comment. Do you
    have any estimate, more or less, of what that might be?
        Mr. Keys. Mr. Chairman and Mr. Pastor, we do not. We are
    looking at all of those facilities. Some of the more critical
    infrastructures will need more attention. Some of them that are
    out on the plains that do not have water against them during
    most of the year would require less. But we do not have a good
    estimate of the total cost right now.
        Mr. Pastor. It is my understanding that the Bureau has
    determined that these increased security costs shall be
    appropriated and be nonreimbursable.
        Mr. Keys. Mr. Chairman and Mr. Pastor, what we are trying
    to do is to address the terrorism and security activities
    associated with the heightened level of attention, and get it
    in place without undue burden on our water users and on our
    power users.
        At some time we will have to reevaluate that
    nonreimbursable status, and the users will then have to step up
    their contributions. The water users and power users now are
    continuing to pay the security costs that they were paying
    before.
        Mr. Pastor. Right.
        Mr. Keys. We are trying to take care of the extra security
    requirements, and then we will step that up at some point in
    the future.
        Mr. Pastor. I think that was the issue, when you determine
    it is nonreimbursable. Because, as I remember, our conversation
    last year was about Hoover Dam--the visitors' center, the
    construction overrun, the additional cost, the cost of the new
    security, and the decrease in visitors. Because for a while it
    was completely closed and now I guess there is a secured tour,
    and some of the users were concerned that the cost that they
    would have to bear would be greater than the value of what they
    were receiving.
        So I think this issue is going to be an issue that will be
    with us for a number of years. Because the users are going to
    get stuck with a very high bill. They would rather see, and are
    asking for your consideration, for the money to be appropriated
    and not reimbursed.
        How am I doing on time?
        Thank you, Mr. Chairman.

                                   TRES RIOS

        You are involved in a project at the Tres Rios with the
    Engineers Corps. You are undertaking a program that is taking
    effluent waters that are contaminated and, by using different
    recharging methods, recharging the aquifers and also producing
    clean water. It is a project that you have been involved in for
    a number of years and I think you have found it successful.
        As I hear you this morning, the Secretary and yourself in
    your testimony, it seems that this initiative that you are
    implementing is to ensure that there are different ways of
    producing clean water.
        One of the problems I think we are facing with this
    particular project--it is a demonstration project that is a
    successful project--is that OMB, for whatever reason, has not
    seen value in it. The question to you from me would be, the
    initiative is to find new ways of cleaning up water and a
    project that you are undergoing as a demonstration project,
    is--doing this, but it may not have the same priority with OMB.
    I do not want to get you in trouble with anybody, but I had to
    make that comment.
        Secretary Norton. I have to say I am not familiar with the
    Tres Rios project specifically.
        Mr. Pastor. Let me invite you to come to Arizona.
        Secretary Norton. We have quite a travel schedule here.
        I do think we need to be creative; and as we look at the
    long-term, dramatically increasing needs for the West, I think
    that the population growth for Arizona in the last census time
    period was about 40 percent. It is huge. We need to be finding
    new ways to deal with those issues. So I think that groundwater
    aquifer recharge is one of the types of things we will have to
    look at. Without commenting on a specific project, I think we
    do need to look at more of those things.
        Mr. Pastor. Many of these waters are contaminated by
    agricultural use. And you take that and effluent, and then find
    ways to clean it up. The problem we are facing and we are going
    to face in the Western States is the Colorado River, most of us
    rely on the Colorado River for water. But I was told that OMB
    was not looking at this project with some priority. But yet I
    hear--and I commend you for it, and I tell you that I think you
    are going the right way, you are finding a source of water by
    reclaiming water so that we are not reliant just on our
    groundwater, but sources that we have used and could--possibly
    could recycle.
        Mr. Hobson. Mr. Latham.

                          Mr. Latham's Opening Remarks

        Mr. Latham. Thank you, Mr. Chairman; and welcome both of
    you here. I just have a couple of brief questions.

                      LEWIS AND CLARK RURAL WATER PROJECT

        One, as far as the Lewis and Clark rural water project and
    your involvement there, how are we doing?
        Mr. Keys. Mr. Chairman, Mr. Latham, it is coming along. It
    is one of those that we took a hard look at on funding for this
    year.
        Mr. Latham. Okay.
        Mr. Hobson. What does that mean?
        Mr. Latham. What does that mean? Good question, Mr.
    Chairman. I have to chair another subcommittee in about 3
    minutes here.

        Secretary Norton. I think, if I can comment generally, that
    was one of our rural water projects; and that funding has been
    cut, based in part, on the assessment of effectiveness by OMB.
        If I could just point out, one of the comparisons was with
    the EPA and the USDA programs that also provide rural water.
    For the Bureau of Reclamation program, we served about 360
    people per million dollars of Federal funding, with the USDA
    program, it was closer to 1,800 people; EPA, over 1,600. That
    was one of the questions that was raised, was whether we were
    really effective in the way we were going about those things.
    Because our funding figures looked different than other very
    similar programs. It is one of the reasons that we want to go
    back and look more comprehensively at this program overall to
    see if there are some things that we could do to be more cost-
    effective.
        Mr. Latham. Okay. It obviously is a major issue up in
    northwest Iowa, South Dakota and Minnesota; and we want to
    continue to work with you on it.

                       MISSOURI RIVER ENDANGERED SPECIES

        I have a kind of hypothetical question. Part of it is real
    in that there is a tremendous shortage of water and the
    reservoirs are down in South Dakota, on the Missouri River. It
    has been expressed to me that there is a possibility, because
    of the low levels, that this spring we may have the least tern
    or plover start nesting at lower level on the banks. What
    happens then? They are an endangered species. Do the reservoirs
    get filled? Do we artificially open up the gates to keep the
    levels down?
        Secretary Norton. We have been working very closely with
    the Corps of Engineers, since that is the primary emphasis on
    the Missouri River areas, on the biological opinions and the
    annual operating plan for the overall Missouri River. That is
    one of our significant concerns, and that is something that
    Assistant Secretary Craig Manson, who oversees the Fish and
    Wildlife Service, is very personally involved in and is
    spending a lot of time analyzing.
        Mr. Keys. Mr. Chairman, Mr. Latham, I might add, last year
    in the Platte River Basin we had that very problem, where one
    of our reservoirs was drawn down, the plover nested on the dam,
    and it was time for the water to come up. We worked closely
    with the Fish and Wildlife Service, and there were emergency
    measures to relocate some of the nests to make it possible to
    raise the reservoirs.
        Mr. Latham. Do you anticipate--my time must be up, Mr.
    Chairman; the buzzer went off--any litigation or anything in
    that regard this time?
        Mr. Keys. We work very closely with the Fish and Wildlife
    Service, and there was none at that time. There is a tremendous
    cooperative effort under way in the Platte River Basin to solve
    the four endangered species problems there, and this is one of
    the things that was addressed by that cooperative committee,
    which is made up of all the Federal agencies and all of the
    States and so forth. We have heard no rumblings of litigation
    from that.
        Mr. Latham. There has not always been agreement as far as
    utilization on the Missouri River between South Dakota and Iowa
    and the down river states. There are some people who may look at
    that as an opportunity.
        Thank you, Mr. Chairman.
        Mr. Hobson. Mr. Doolittle.

                        Mr. Doolittle's Opening Remarks

        Mr. Doolittle. Thank you, Mr. Chairman.

                              CENTRAL UTAH PROJECT

        Mr. Keys, Madam Secretary, an annual battle continues with
    the Western Area Power Administration, which has the
    responsibility, on behalf of public power, to contribute $6
    million into a special account for mitigation and water
    conservation. WAPA's contribution is in addition to money put
    in by the State of Utah, Interior and the local district. In
    the fiscal year 2004 budget request, WAPA is trying to do
    something creative. They have shifted their funding
    responsibility over to the Bureau of Reclamation's budget. The
    fiscal year 2004 budget request for the Western Area Power
    Administration reflects this.
        I guess I would just like to know, do you support ending
    WAPA's responsibilities to contribute into this account and
    transferring this funding obligation to the Bureau of
    Reclamation? And, if so, why have you not built this
    contribution into your fiscal year 2004 budget request?
        Mr. Keys. Mr. Chairman, Mr. Doolittle, we do not support
    that. This proposal caught us completely by surprise earlier
    this week, and we are in negotiations with the Department of
    Energy to rectify the situation. We do not support that.
        Mr. Doolittle. Thank you.

                                   TITLE XVI

        The fiscal year 2004 budget request for Title 16 water
    reclamation and reuse is $12.68 million, significantly less
    than the $33.3 million Congress provided in fiscal year 2003.
    Reclamation is proposing to use the fiscal year 2004 funds for
    completion of projects already under construction. But the 2004
    funding request concerns me. Water reclamation, water recycling
    and water reuse technology should be receiving greater emphasis
    in meeting growing and changing demands for water. Your budget
    justifications state that funding under this program is being
    reduced because it is not one of your core missions. The
    assessment of this program in the budget states that it helps
    expand water supplies in areas that routinely face severe water
    shortages.
        California is continually faced with lack of supplies, and
    desalination is a great way to provide additional water to my
    State. Can you explain for me why you are proposing to scale
    back the program when it seems to hold such great promise; and
    have you ever proposed a comprehensive plan for water
    desalination in Southern California; and, if not, why not?
        Mr. Keys. Mr. Chairman, Mr. Doolittle, the Bureau of
    Reclamation will continue to work with you and all of our
    constituents to construct the wastewater reuse and recycling
    projects that you authorize and fund and to complete those that
    are under construction.

     Our fiscal year 2004 budget for Reclamation and most of
    Interior is flat, but it does actually increase the Title 16
    request from 2003 to 2004 from about 11.5 to 12.5 million
    dollars. Title 16 is a valid part of our program.
        Mr. Doolittle. Can I interrupt you? Now, I thought it was
    being reduced. You just told me it is being increased.
        Mr. Keys. Sir, the request that was made--the official
    request in 2003 was for $11.55 million. Our request for 2004 is
    $12.68.
        Mr. Doolittle. Okay. This is your internal request to bump
    this up, but, in fact, $12.68 million would be a dramatic
    reduction over what was approved by the Congress; right?
        Mr. Keys. What we are requesting for 2004 is less than was
    enacted for 2003.
        Mr. Doolittle. Right. I am not being argumentative with
    you, but I read in your statements--you talk about innovation,
    how to prevent crisis-level conflicts, the four Cs and all of
    that. I do not see anywhere in either one of your statements a
    proposal for enlarging or building new dams--which I am very
    disappointed about, by the way. That is my way of providing
    water, and I do not see that in here.
        One other way we can provide and in effect increase yield,
    which is really what the bottom line is, does come a great deal
    through this Title 16 program--and here I would just encourage
    you to step up to the plate. I mean, you know, either give us
    some new dam proposals--and I have got several you should
    consider--or at least, in the meantime, give us something we
    know that works, which is this Title 16 program. And beef it
    up. I mean, we have got to have some leadership from the
    administration in these key areas.
        So if we are not going to do Title 16, I want to see your
    budget submission for the Auburn Dam--which I would prefer to
    Title 16, by the way.
        What is your reaction, what do you think? This does not
    seem to be getting the attention it deserves, does it?
        Secretary Norton. One of the things that we are trying to
    look at is how we can resolve some of these issues from a
    Westwide approach, taking a step back to look at what we ought
    to be doing programmatically and systemwide to address some of
    these kinds of issues; whether that is increasing the
    development of technology that would bring down the cost of
    some of these types of programs, or whether we can enhance our
    institutional structures to meet these needs in other ways.
    Some of what you will see in our budget is taking a step back
    from specific projects to look across the whole area of our
    responsibilities and decide where we ought to go from here for
    the long-term.
        Mr. Doolittle. So you might conclude a year from now that
    this is something that you are really going to beef up?
        Secretary Norton. We are going to be looking across the
    board at the types of things that would be most effective.
        Mr. Doolittle. Well, good. I will look forward to the
    Auburn Dam proposal as well.
        Let me ask you this, if I have time, Mr. Chairman.

                             SUMNER PECK SETTLEMENT

        Sumner Peck--I note that yesterday the Department of
    Justice has determined that the first installment of the Sumner
    Peck settlement, $35 million plus an initial $5 million
    payment, will be made from the Judgment Fund, which is where I
    always thought it should have come from.
        I also understand that the Department of Justice is still
    determining policy for the remainder of the settlement.
        So here is my question: What is the current status of the
    fiscal year 2003 payments?
        Secretary Norton. The Department of Justice's ruling means
    that those will be made from the Judgment Fund.
        Mr. Doolittle. So we could expect that forthwith, you
    think?
        Secretary Norton. Yes.
        Mr. Doolittle. Secondly, is the Department of Justice
    considering the use of the Judgment Fund for the remaining
    payments?
        Secretary Norton. That is under consideration. Let me ask
    John Trezise to comment on this.
        Mr. Trezise. Mr. Doolittle, as the Secretary said, the
    Department of Justice is looking at that issue. As you know,
    the omnibus bill included language concerning payment of the
    Sumner Peck settlement from the Bureau of Reclamation
    appropriation. And Justice has looked at that language with
    respect to this year's payments. They are still looking at the
    question of how that language will affect payments for 2004 and
    2005.
        Mr. Doolittle. I hope we are not going to have to go
    through all of this all over again with DOJ trying to raid all
    the reclamation projects in California to pay for this.
        Who controls the Judgment Fund and how does that work?
        Mr. Trezise. It is controlled by the Department of Justice.
        Mr. Doolittle. Totally by DOJ? Does any other agency have
    input into that?
        Mr. Trezise. The General Accounting Office has some
    technical role in the Judgment Fund, but the legal
    interpretation of when the Judgment Fund is available is a
    Department of Justice function.
        Mr. Doolittle. Does the Department of the Treasury have a
    say in what happens with the Judgment Fund?
        Mr. Trezise. Other than making payments authorized by the
    Department of Justice, no.
        Mr. Hobson. What I would like to do--your time is up, John.
    I would like to go to Mr. Peterson, give him 5 minutes. Then we
    are going to go vote; and I think, unless somebody has some
    heavy questioning, we will let this go.
        I would like to make sure that every member puts in any
    questions they may have for the record today. We hope you will
    respond within 2 weeks, and I would be interested in the one to
    Mr. Visclosky cleared up.
        So, Mr. Peterson, we will go to you for your 5 minutes.
        If members want to go vote, they can. This will be the end
    of the hearing.

                         Mr. Peterson's Opening Remarks

        Mr. Peterson. Thank you, Mr. Chairman. I will be quick.
        I am not sure this is an appropriate question here, but it
    is an issue I think we should be able to get an answer to. I am
    new on this committee, and I am not sure of all the
    jurisdictions and everything that we cover. I haven't absorbed
    all of that. Where are we on relicensing of hydropower in this
    country?
        Secretary Norton. I can say, generally, the Department of
    the Interior has been working out its procedures for our Fish
    and Wildlife comments, and input on that relicensing procedure.
    Working out what that process is going to be is still under
    way.
        Mr. Keys. Mr. Chairman, Mr. Peterson, the Reclamation
    facilities are not subject to relicensing by FERC. We
    understand that FERC has a schedule and that, for the most
    part, they are on schedule for relicensing all of the power
    facilities all over the United States that are subject to their
    jurisdiction.
        Mr. Peterson. But we are going to get to the finish line?
    We are not going to shut down hydropower?
        Mr. Keys. We cannot speak for the Energy Department or
    those people.
        Mr. Peterson. That is totally the Energy Department?
        Mr. Keys. They are responsible for it.
        What the Secretary was talking about is the pieces of those
    relicensing that Interior people work with them on.
        Mr. Peterson. Okay. And you get the reaction through Fish
    and Wildlife which can cause a delay?
        Secretary Norton. Basically, the Fish and Wildlife Service
    imposes the fish-related conditions on the relicensing. So this
    is a re-examination of exactly how we go about developing our
    conditions, that we would apply. This is how that ties into the
    FERC process.
        Mr. Peterson. Do we have a list of dams and plants that
    hydro could be added to? Is there any list of potentials for
    hydro?
        Mr. Keys. Mr. Chairman, Mr. Peterson, all over the United
    States--I don't know of a list. In Reclamation, we keep up with
    those. FERC does have some jurisdiction when there is not a
    Federal power authorization there; and any entity that is
    interested in doing that, we work with them. So we have such a
    list for Reclamation, but I don't know of any such for all of
    the other facilities.
        Secretary Norton. And, Mr. Peterson, if I could add, we are
    enhancing our hydropower generation at our existing facilities.
    We have been going through and redoing our turbines and looking
    at the various ways that we can enhance that production.
        Mr. Peterson. To increase?
        Secretary Norton. Yes.
        Mr. Peterson. But we do not have a list of where we would
    like to add some?
        Secretary Norton. Not for ones that currently have no
    hydropower generation.
        Mr. Peterson. But there are a lot of dams that could be
    producing hydro but are not? Am I wrong there?
        Secretary Norton. I would have to defer to John, because I
    am not sure what qualifies a dam as a potential hydro dam.

        Mr. Keys. There was a wave of that activity a few years
    ago, and economic studies were done all over the place. I would
    guess that most of the viable ones are taken. There may be some
    now at the higher energy costs that may become viable, but I do
    not have such a report.
        Mr. Peterson. Could you refer me to such a report that I
    could look at?
        Mr. Keys. We will try to find something on that for you.
        Mr. Peterson. Thank you.
        Mr. Hobson. Mr. Visclosky has a 30-second question. Then I
    think what we are going to have to go vote.
        Mr. Doolittle wanted to talk to you, but there are three
    votes. He will not be able to get back. I think he thought
    there was only one. I would like you to talk--he has got three
    more questions that he would like to ask you all. You need to
    figure out how to do that on the phone or something, because he
    isn't going to get back.
        Secretary Norton. We will be happy to work with you on
    that.

                                     CALFED

        Mr. Visclosky. I want to thank the Park Service people who
    have been working with us. But on CALFED--and I am supportive
    of the idea of people getting together and reaching agreement--
    absent authorization, at some point in time, how long can we
    continue to pick programs, if you would, as far as
    appropriations that fit the concept and existing authorization,
    before we simply have to say this theory did not work out?
        Secretary Norton. It is my understanding that in the 2003
    omnibus there was some limited authorization language. We are
    continuing to work with the State of California and the
    California delegation on a more permanent statutory
    authorization.
        Mr. Visclosky. Thank you very much. Because I just think at
    some point if people would make decisions everybody would be
    better off.
        Mr. Hobson. I am going to let you go. We have to go vote.
        Mr. Doolittle is not going to get back, but he has two or
    three questions that he will submit for the record or talk to
    you about. I don't know if it is money for the Auburn Dam or
    what.
        Thank you for coming. Appreciate it. Sorry we have to run.
        [Questions for the record follow:]

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        Mr. Hobson. At this point, we will place the budget
    justifications for the Appalachian Regional Commission in the
    record.
        [The information follows:]

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