[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]


 
                              MEMBERS' DAY

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

                                HEARING

                               before the

                        COMMITTEE ON THE BUDGET
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

           HEARING HELD IN WASHINGTON, DC, FEBRUARY 14, 2007

                               __________

                            Serial No. 110-7

                               __________

           Printed for the use of the Committee on the Budget


                       Available on the Internet:
       http://www.gpoaccess.gov/congress/house/budget/index.html


                                 ______

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33-750                      WASHINGTON : 2007
_____________________________________________________________________________
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                        COMMITTEE ON THE BUDGET

             JOHN M. SPRATT, Jr., South Carolina, Chairman
ROSA L. DeLAURO, Connecticut,        PAUL RYAN, Wisconsin,
CHET EDWARDS, Texas                    Ranking Minority Member
LOIS CAPPS, California               J. GRESHAM BARRETT, South Carolina
JIM COOPER, Tennessee                JO BONNER, Alabama
THOMAS H. ALLEN, Maine               SCOTT GARRETT, New Jersey
ALLYSON Y. SCHWARTZ, Pennsylvania    THADDEUS G. McCOTTER, Michigan
MARCY KAPTUR, Ohio                   MARIO DIAZ-BALART, Florida
XAVIER BECERRA, California           JEB HENSARLING, Texas
LLOYD DOGGETT, Texas                 DANIEL E. LUNGREN, California
EARL BLUMENAUER, Oregon              MICHAEL K. SIMPSON, Idaho
MARION BERRY, Arkansas               PATRICK T. McHENRY, North Carolina
ALLEN BOYD, Florida                  CONNIE MACK, Florida
JAMES P. McGOVERN, Massachusetts     K. MICHAEL CONAWAY, Texas
BETTY SUTTON, Ohio                   JOHN CAMPBELL, California
ROBERT E. ANDREWS, New Jersey        PATRICK J. TIBERI, Ohio
ROBERT C. ``BOBBY'' SCOTT, Virginia  JON C. PORTER, Nevada
BOB ETHERIDGE, North Carolina        RODNEY ALEXANDER, Louisiana
DARLENE HOOLEY, Oregon               ADRIAN SMITH, Nebraska
BRIAN BAIRD, Washington
DENNIS MOORE, Kansas
TIMOTHY H. BISHOP, New York

                           Professional Staff

            Thomas S. Kahn, Staff Director and Chief Counsel
                James T. Bates, Minority Chief of Staff


                            C O N T E N T S

                                                                   Page
Hearing held in Washington, DC, February 14, 2007................     1
Statement of:
    Hon. Collin C. Peterson, a Representative in Congress from 
      the State of Minnesota.....................................     1
    Hon. Bob Goodlatte, a Representative in Congress from the 
      State of Virginia..........................................     5
    Hon. Dennis Cardoza, a Representative in Congress from the 
      State of California........................................    11
    Hon. Norman Dicks, a Representative in Congress from the 
      State of Washington........................................    15
    Hon. Julia Carson, a Representative in Congress from the 
      State of Indiana...........................................    22
    Hon. Vernon Ehlers, a Representative in Congress from the 
      State of Michigan..........................................    25
    Hon. Rush Holt, a Representative in Congress from the State 
      of New Jersey..............................................    28
    Hon. Nancy Boyda, a Representative in Congress from the State 
      of Kansas..................................................    34
    Hon. Vern Buchanan, a Representative in Congress from the 
      State of Florida...........................................    38
    Hon. Rick Larsen, a Representative in Congress from the State 
      of Washington..............................................    41
    Hon. Frank Wolf, a Representative in Congress from the State 
      of Virginia................................................    46
    Hon. Donna M. Christensen, a Delegate in Congress from the 
      U.S. Virgin Islands........................................    52
    Hon. Brian Higgins, a Representative in Congress from the 
      State of New York..........................................    59
    Hon. Robin Hayes, a Representative in Congress from the State 
      of North Carolina..........................................    61
    Hon. Michael Turner, a Representative in Congress from the 
      State of Ohio..............................................    68
    Hon. Jason Altmire, a Representative in Congress from the 
      State of Pennsylvania......................................    72
    Hon. Jim Matheson, a Representative in Congress from the 
      State of Utah..............................................    76
    Hon. Bob Filner, a Representative in Congress from the State 
      of California..............................................    78
    Hon. Jim Oberstar, a Representative in Congress from the 
      State of Minnesota.........................................    84
    Hon. Mike Honda, a Representative in Congress from the State 
      of California..............................................    89
    Hon. Timothy Walz, a Representative in Congress from the 
      State of Minnesota.........................................    95
    Hon. Brad Ellsworth, a Representative in Congress from the 
      State of Indiana...........................................    98
    Hon. John Boozman, a Representative in Congress from the 
      State of Arkansas..........................................   103
    Hon. Diane Watson, a Representative in Congress from the 
      State of California........................................   107
    Hon. Rob Bishop, a Representative in Congress from the State 
      of Utah....................................................   110
Prepared statement of, additional materials submitted:
    Mr. Peterson.................................................     4
    Mr. Goodlatte................................................     7
    Mr. Cardoza..................................................    13
    Mr. Dicks....................................................    18
    Ms. Carson...................................................    23
    Mr. Ehlers...................................................    26
    Mr. Holt.....................................................    30
    Mrs. Boyda...................................................    36
    Mr. Larsen...................................................    43
    Mr. Wolf.....................................................    48
    Dr. Christensen..............................................    55
    Mr. Higgins..................................................    60
    Mr. Hayes....................................................    64
    Mr. Altmire..................................................    74
    Mr. Filner...................................................    80
    Mr. Oberstar.................................................    87
    Mr. Honda....................................................    92
    Hon. Bob Etheridge, a Representative in Congress from the 
      State of North Carolina....................................    94
    Mr. Walz.....................................................    96
    Mr. Ellsworth................................................   101
    Mr. Boozman..................................................   105
    Ms. Watson:
        Prepared statement.......................................   108
        Los Angeles Times article................................   108
    Mr. Bishop of Utah...........................................   112
    Hon. Madeleine Z. Bordallo, a Delegate in Congress from the 
      Territory of Guam..........................................   115
    Hon. Kathy Castor, a Representative in Congress from the 
      State of Florida...........................................   117
    Hon. Vito Fossella, a Representative in Congress from the 
      State of New York..........................................   119
    Hon. Eddie Bernice Johnson, a Representative in Congress from 
      the State of Texas.........................................   120
    Hon. Dennis J. Kucinich, a Representative in Congress from 
      the State of Ohio..........................................   121
    Hon. Doris O. Matsui, a Representative in Congress from the 
      State of California........................................   122
    Hon. Randy Neugebauer, a Representative in Congress from the 
      State of Texas.............................................   124
    Hon. Peter J. Roskam, a Representative in Congress from the 
      State of Illinois..........................................   124
    Hon. John P. Sarbanes, a Representative in Congress from the 
      State of Maryland..........................................   127
    Hon. Hilda L. Solis, a Representative in Congress from the 
      State of California........................................   128
    Hon. Bart Stupak, a Representative in Congress from the State 
      of Michigan................................................   131


                              MEMBERS' DAY

                              ----------                              


                      WEDNESDAY, FEBRUARY 14, 2007

                          House of Representatives,
                                   Committee on the Budget,
                                                    Washington, DC.
    The committee met, pursuant to call, at 2:00 p.m., in room 
210, Cannon House Office Building, Hon. John M. Spratt, Jr. 
[chairman of the committee] presiding.
    Present: Representatives Spratt, Ryan, Kaptur, Porter, 
Becerra, Smith, Doggett, Alexander, Blumenauer, Berry, Sutton, 
Etheridge, Hooley, Baird, Moore, and Bishop.
    Chairman Spratt. Mr. Peterson and Mr. Goodlatte, we started 
to hit the ground running but I think we had better get 
underway in light of the fact that the Republicans have a 
conference at 2:15 is it? So, without any further to do, 
Chairman Peterson, the floor is yours and we extend the same 
privileges to Mr. Goodlatte. We look forward to statements from 
both of you. We have allotted ten minutes for each person, for 
each set of witnesses. So, if you could keep it down to a 
little less than ten minutes so there will be time for 
questions we would appreciate it.

   STATEMENT OF HON. COLLIN C. PETERSON, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MINNESOTA

    Mr. Peterson of Minnesota. All right. Thank you very much, 
Chairman Spratt and Ranking Member Ryan and other members. 
Thank you for the opportunity to testify about the federal 
budget and its provisions that fall under the Agriculture 
Committee's jurisdiction. I am pleased to be here today with my 
good friend, Ranking Member Goodlatte. We work well together on 
a bipartisan way on the Ag Committee, and we are committed to 
continuing that tradition as the we write the new Farm Bill.
    As you know, the 2002 Farm Bill is set to expire September 
30, and last year Mr. Goodlatte led the Committee across the 
country for a series of field hearings to find out what farmers 
and ranchers thought about how the current Farm Bill is working 
and what changes they would like to see made in the next Farm 
Bill. What we heard in most of those field hearings is that in 
general, the 2002 Farm Bill is working well for producers and 
that the basic structure should be maintained.
    The feedback on the 2002 Farm Bill was especially positive 
when you compare it to the reaction from farm country to the 
1996 Farm Bill, which in my opinion was a bad deal for 
producers and taxpayers alike. The '96 Farm Bill dismantled the 
safety net in favor of a free market approach to farming. It 
was written during a time of high commodity prices under the 
assumption that those prices would remain high well into the 
future, actually a similar situation to what we have today. And 
the prices did not stay high and Congress had to intervene, 
spending more than $23 billion in additional payments to farms 
over the life of the '96 Bill.
    Now the administration is proposing a Farm Bill that we 
just had a little over three-house hearing on the Committee 
just now where they are once again proposing to weaken the 
safety net for farmers on the assumption that these prices will 
stay high. In my opinion we have made that assumption before 
and did not get real great results, and it cost the taxpayers 
money. And I want to really avoid that experience again.
    In contrast, the 2002 Bill, which restored the safety net 
for farmers, has proven to be one of the most fiscally 
responsible government programs that we have had. By making 
payments to farms when prices are low and returning savings 
when prices are high, the 2002 Farm Bill represented a major 
policy improvement.
    In one way, we have become victims of our own success with 
the 2002 Bill. When former Ag Chairman Combest wrote the Bill, 
along with his colleagues and Mr. Goodlatte and I, his baseline 
for the Safety Net Program was $140 billion over ten years. The 
most recent baseline has shrunk to about $80 billion. And while 
the baseline has increased for some other Farm Bill programs, 
these increases have come in areas such as food stamps which 
now account for 67 percent of our budget. And they need to be 
maintained. But the bottom line is that additional resources 
are going to be needed to produce a policy that facilitates a 
strong farm sector and helps our nation move towards energy 
independence in a fiscally responsible way.
    Mr. Chairman, one of the ideas in the administration's Farm 
Bill Proposal that I support is their conclusion that 
additional budgetary resources are needed for the Farm Bill. 
For example, USDA's proposal recommends increased funding for 
the Renewable Fuels Program. One of the biggest developments 
that agriculture in rural America has seen in a generation, and 
maybe in a lifetime, has been the growing demand and expanding 
market for agriculturally based energy sources, including 
ethanol and biodiesel. The excitement about this exists far 
beyond just our rural communities. As our colleagues from 
across the country in urban and suburban districts I think are 
as excited about the potential for ethanol and these other 
renewable fuels as we are to reduce our nation's dependence on 
foreign energy sources.
    We need a strong energy title in the Farm Bill. However, we 
currently have no baseline money to accomplish that. I believe 
that this is a necessary investment that we must make, 
especially to jump start the transition from corn-based ethanol 
to cellulosic ethanol, which will provide a long term, 
environmentally friendly, and sustainable renewable fuels 
industry in the United States.
    Another interesting part of the administration proposal is 
the additional funding to support the fruit and vegetable 
industry. Many of our colleagues in the House as well as the 
Senate are in agreement that some sort of action in this area 
should be a priority for the 2007 Bill.
    USDA is also calling for an extension of the MILC Program, 
the Milk Income Loss Contract Program. It is a long story, but 
this is a program that has become very popular amongst dairy 
farmers across the country but it currently does not have a 
baseline.
    The administration has also recommended expanding 
agriculture conservation programs. The 2002 Farm Bill had the 
largest increase in such programs in the Department's history. 
Even so, again, many of our colleagues are persuaded as is the 
Secretary that further expansions are appropriate.
    Another proposal from USDA recommends increases in the Food 
Stamp Program that would counter the rise in obesity, remove 
the cap on the program's child care deduction, and exclude 
college savings accounts from resource limit calculations.
    In addition to these priorities, some minor but perhaps 
desirable rebalancing in basic commodity programs will be 
proposed. And those will also require an increase in funds 
available to the Committee.
    Knowing that you have a difficult task, I nevertheless feel 
strongly that increasing the resources made available for 
writing the Farm Bill will serve our nation well and will yield 
substantial and tangible gains in return. The Budget Committee 
is an important partner of ours in the development of this new 
Farm Bill and I appreciate your consideration of the case that 
we are making here today, and looking forward to continuing to 
work with you as we develop this Budget Resolution. And in the 
handout I have included some historical information here to 
kind of give the Committee the lay of the land, if you will, on 
where we are at. We have summary sheet and the one goes into 
more detail, but we have a $60 billion, as I said, reduction in 
the baseline in the commodity area. All the other parts are up 
substantially: conservation 32 percent, Food Stamps and Child 
Nutrition 46 percent. So overall, when you include everything, 
we have an increase in the baseline but in the commodity area 
we have a substantial increase. That is the way it is supposed 
to work. And as I have said earlier, quite a few of the folks 
in the this area as we have traveled around the country are 
saying if we just extended the current Commodity Title that 
would be something they could live with. But there are some 
issues there that have been bubbling around, especially with 
wheat and barley in the way they were treated in 2002. I made a 
personal attempt to get additional resources for barley that 
was unsuccessful, and so we have some other information that we 
will make available to you, some analysis of what kind of 
safety net is available in these different commodities based on 
a percentage of their price and so forth that I think argues 
for some modifications amongst these commodities that probably 
will take some resources to fix.
    So we are here to plead with you to see if you can help us 
figure out a way to get some additional resources and then 
hopefully be able to support you as you move ahead with your 
budget resolution.
    [The prepared statement of Mr. Peterson follows:]

  Prepared Statement of Hon. Collin C. Peterson, a Representative in 
                  Congress From the State of Minnesota

    Chairman Spratt, Ranking Member Ryan and Members of the Budget 
Committee, thank you for this opportunity to testify about the Federal 
Budget and its provisions that fall under the Agriculture Committee's 
jurisdiction. I am pleased to be joined today by Agriculture Committee 
Ranking Member Bob Goodlatte. The Agriculture Committee has a long 
history of bipartisan cooperation, and we are committed to continuing 
that tradition as we write a new Farm Bill this year.
    As you know, the 2002 Farm Bill is set to expire on September 30. 
Last year, Mr. Goodlatte led the Committee across the country for a 
series of field hearings to find out what farmers and ranchers thought 
about how the current Farm Bill is working and what changes they would 
like to see made.
    What we heard at those field hearings is that in general, the 2002 
Farm Bill is working well for producers and that the basic structure 
should be maintained.
    The feedback on the 2002 Farm Bill was especially positive when you 
compare it to the reaction from farm country to the 1996 Farm Bill, 
which was a bad deal for producers and taxpayers alike. The 1996 Farm 
Bill dismantled the safety net in favor of a free market approach to 
farming. It was written during a time of high commodity prices under 
the assumption that prices would remain high well into the future. 
Well, prices didn't stay high, and Congress had to intervene, spending 
more than $23 billion in additional ``low price'' payments to farmers 
over the life of the 1996 bill.
    Now, the Bush Administration is proposing that we weaken the safety 
net for farmers on the assumption that commodity prices will remain at 
historically high levels. We made that assumption once before with 
catastrophic results, and taxpayers paid the price.
    In contrast, the 2002 Farm Bill, which restored the safety net for 
farmers, has proven to be one of the most fiscally responsible 
government programs. By making payments to farmers when prices are low 
and returning savings when prices are high, the 2002 Farm Bill 
represented a major policy improvement.
    In one way, we have become victims of our own success with the 2002 
Farm Bill. When former Ag Committee Chairman Larry Combest wrote the 
2002 Farm Bill, his baseline for the safety net programs was 140 
billion dollars over ten years. The most recent baseline has shrunk to 
about 80 billion dollars. While the baseline has increased for some 
Farm Bill programs, these increases have come in areas such as food 
stamps, which account for 67 percent of our budget, that need to be 
maintained, not cut to fund other programs. The bottom line is that 
additional resources are needed to produce a policy that facilitates a 
strong farm sector and helps our nation move toward energy independence 
in a fiscally responsible way.
    Mr. Chairman, one of the ideas in the Administration's Farm Bill 
proposal that I support is their conclusion that additional budgetary 
resources are needed for the Farm Bill. For example, USDA's proposal 
recommends increased funding for renewable fuel programs.
    One of the biggest developments that agriculture and rural America 
has seen in a generation has been the growing demand and expanding 
market for agriculturally-based energy sources, including ethanol and 
biodiesel. The excitement about this exists far beyond just our rural 
communities, as our colleagues from across the country in urban and 
suburban districts are also excited about the potential for ethanol and 
other renewable fuels to reduce our nation's dependence on foreign 
energy sources.
    We need a strong energy title in the Farm Bill; however, we 
currently have no baseline money to accomplish that. I believe that 
this is a necessary investment that we must make, especially to 
jumpstart the transition from corn-based ethanol to cellulosic ethanol, 
which will provide a long-term, environmentally friendly and 
sustainable ethanol industry in the United States.
    Another interesting part of the Administration proposal is 
additional funding to support the fruit and vegetable industry. Many of 
our colleagues in the House as well as the Senate are in agreement that 
some sort of action in this area should be a priority for the 2007 Farm 
Bill. USDA also is calling for the extension of the Milk Income Loss 
Contract program. It's a long story, but this is a program that has 
become very popular among many dairy farmers, but it currently does not 
have a baseline.
    The Administration also recommended expanding agricultural 
conservation programs. The 2002 Farm Bill had the largest increase in 
such programs in the Department's history. Even so, again many of our 
colleagues are persuaded--as is the Secretary--that further expansions 
are appropriate. Another proposal from USDA recommends increases to the 
Food Stamp program that would counter the rise in obesity, remove the 
cap on the program's child care deduction, and exclude college savings 
accounts from resource limit calculations.
    In addition to these priorities, some minor, but perhaps desirable, 
rebalancing in basic commodity programs will be proposed, and those 
will also require an increase in funds available to the Committee.
    Knowing that you have a difficult task, I nevertheless feel 
strongly that increasing the resources made available for writing the 
Farm Bill will serve our nation well and will yield substantial and 
tangible gains in return. The Budget Committee is an important partner 
of ours in the development of a responsible Farm Bill. I appreciate 
your consideration of the case I make today and look forward to working 
with you as you develop the budget resolution.

    Chairman Spratt. Mr. Goodlatte, would you like to add to 
that?

 STATEMENT OF HON. BOB GOODLATTE, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF VIRGINIA

    Mr. Goodlatte. Yes, thank you very much Mr. Chairman, Mr. 
Moore. We appreciate the opportunity to make our case for 
American farmers and ranchers and all of rural America. 
Chairman Peterson and I are continuing the process of 
information gathering and evaluating the information we have 
received as we move forward and prepare to reauthorize the Farm 
Bill later this year.
    We began this process more than a year ago with the 
Committee's first Farm Bill hearing in Fayetteville, North 
Carolina and convened ten more field hearings, as well as 
several subcommittee hearings, throughout the United States 
since then. In addition, we held several full Committee 
hearings in Washington, D.C. and in total heard formal 
testimony from 174 farmers and ranchers and through our website 
and other means for input thousands more. Even now, as we move 
into the home stretch, there is still much work to be done. We 
set out on every hearing intent on finding out what farmers and 
ranchers wanted to see in the next Farm Bill. In turn the 
witnesses, as well as members of the local communities in the 
audience, wanted to know the situation in Washington that would 
influence the next Farm Bill. While there are a myriad of 
factors that will influence what the outcome of the Farm Bill 
will be, both Mr. Peterson and I unabashedly agree that it all 
comes down to how much money is available in the budget. Today 
we take the first step to find out how much money will be 
available for rural America.
    While in the field listening to producers, the popularity 
of the current Farm Bill was readily apparent. Though we were 
proud to hear that farmers were happy with our 2002 product, I 
felt the need to caution them that in terms of the budget 
environment much has changed since then. Today the budget 
environment we find ourselves in is very different than that of 
2002. In 2002, we had a $198 billion baseline for commodities, 
conservation, research and rural development, excluding 
nutrition. I told farmers that the handwriting has been on the 
wall for some time and the budgetary constraints we feel now 
will likely continue into the future. Most notably, CBO's 
March, 2006 estimate to continue the current Farm Bill baseline 
was $104 billion which was significantly lower than the 
baseline in 2002. However, in the most recent CBO estimate the 
projected baseline took another $30 billion hit resulting in an 
estimated $74 billion over ten years. Again, that is excluding 
nutrition programs.
    Throughout our hearings, we heard that some commodity 
groups wanted a higher loan rate. Others wanted a more 
consistent Counter Cyclical Program, and still others wanted an 
increased direct payment or a payments of any kind. The ideas 
and suggestions about how we could perfect current farm 
programs were as numerous as they were diverse, differing by 
commodity and region of the country. How each farmer defined an 
adequate safety net depended upon what he was growing and where 
he was growing it.
    There was one common issue that we heard from all varieties 
of commodity producers in every region of the country: the 
increasing cost of environmental compliance. Farmers and 
ranchers across the nation, from row crop producers to fruits 
and vegetable growers and livestock owners, all complained 
about the costs they are incurring in order to stay in 
compliance with burgeoning environmental regulations. The 
growing list of requirements thrust upon farmers and ranchers 
are largely debilitating. We heard from quite a few that were 
so confounded with the increased regulation and sheer breadth 
and depth of the seemingly endless compliance requirements that 
they were seriously contemplating a career change. For most, 
the situation is beyond a matter of profitably, for which an 
increased direct payment or a higher loan rate can compensate. 
It has, unfortunately, become a matter of survivability. We
    We must put the taxpayers' money where our mouth is. We 
must help those that, by the sheer nature of their livelihoods, 
are ensnared by burdensome environmental regulations and 
requirements. We must offer increased financial assistance to 
help those who are willing to do the right thing, or at least 
what the law requires, but cannot afford the cost of 
compliance. I am not asking the House Budget Committee to roll 
back environmental laws, rules or regulations. I am asking for 
the resources needed to help our farmers and ranchers who are 
first and best stewards of the land to comply with the complex 
and costly web of federal regulation that govern land use. Our 
farmers and ranchers will be the first to tell you that their 
production yields are directly influenced by the quality of the 
land, air and water around them, but that responsible use of 
those elements is absolutely necessary to agriculture 
production in this country. There can be no reservations about 
the need to assist those in rural America to comply with the 
numerous laws and regulations that we all too often thrust upon 
those that are least able to afford compliance.
    Mr. Chairman, if I might add to that point. More than half 
of all of the farmers in America do not participate in the 
commodity programs that are so important to many in many 
regions of the country. They may be fruits and vegetables 
producers, they may be livestock producers, they may be 
producers of other row crops that do not participate in the 
major commodity programs. But they all have to comply with 
environmental regulations. And when they do comply, it not only 
benefits their farm but it also benefits those who live 
downstream, downwind, in the same community, along with 
Chesapeake Bay in my region of the country, and so many other 
environmentally sensitive areas in other parts of the country.
    And if we are to take the current baseline for agriculture 
and recognize that the commodity programs have worked very well 
and prices have gone high which has resulted in a great bonus, 
I would argue, to the taxpayers and to the Budget Committee. 
But if we operate simply on that baseline and do not recognize 
that since 2002 many circumstances have changed, many needs 
have changed, and if we are going to write a new Farm Bill we 
are going to have to have resources to do it. That does not 
just recognize that if we are going to address the commodity 
programs, that we are going to have to address rural America in 
general and the problems that it has. And if we operate off the 
current baseline we will not be able to any where near meet 
those needs.
    [The prepared statement of Mr. Goodlatte follows:]

Prepared Statement of Hon. Bob Goodlatte, a Representative in Congress 
                       From the State of Virginia

    Chairman Spratt and Ranking Member Ryan, thank you for affording us 
this opportunity to make our case for American farmers and ranchers, 
and all of rural America. Chairman Peterson and I are continuing the 
process of information gathering and evaluating the information we've 
received as we move forward and prepare to reauthorize the farm bill 
later this year. We began this process more than a year ago with the 
Committee's first farm bill field hearing in Fayetteville, North 
Carolina and convened 10 more field hearings, as well as several 
Subcommittee hearings, throughout the United States since then. In 
addition, we held several full Committee hearings in Washington, DC, 
and, in total, heard from 174 farmers and ranchers. Even now as we move 
into the home stretch, there is still much work to be done.
    We set out on every hearing intent to find out what farmers and 
ranchers wanted to see in the next farm bill. In turn, the witnesses, 
as well as members of the local communities in the audience, wanted to 
know the situation in Washington that would influence the next farm 
bill. While there are a myriad of factors that will influence what the 
outcome of the farm bill will be, both Mr. Peterson and I unabashedly 
agreed that it all comes down to how much money is available in the 
budget. Today, we take the first step to find out how much money will 
be available for rural America.
    While in the field listening to producers the popularity of the 
current farm bill was readily apparent. Though we were proud to hear 
that farmers were happy with our 2002 product, I felt the need to 
caution them that in terms of the budget environment much has changed 
since then.
    Today, the budget environment we find ourselves in is very 
different than that of 2002. In 2002, we had a $198 billion baseline 
for commodities, conservation, research, and rural development 
(excluding nutrition). I told farmers that the handwriting has been on 
the wall for some time and the budgetary constraints we feel now will 
likely continue into the future. Most notably, CBO's March 2006 
estimate to continue the current farm bill baseline was $104 billion 
which was significantly lower than the baseline in 2002; however, in 
the most recent CBO estimate, the projected baseline took another $30 
billion hit, resulting in an estimated $74 billion over 10 years.
    Throughout our hearings, we heard that some commodity groups wanted 
a higher loan rate, others wanted a more consistent counter cyclical 
program and still others wanted an increased direct payment or a 
payment of any kind. The ideas and suggestions about how we could 
perfect current farm programs were as numerous as they were diverse, 
differing by commodity and region of the country. How each farmer 
defined an ``adequate safety net'' depended on what he was growing and 
where he was growing it.
    There was one common issue that we heard about from all varieties 
of commodity producers in every region of the country: the increasing 
cost of environmental compliance. Farmers and ranchers across this 
nation, from row cop producers to fruits and vegetable growers and 
livestock owners all complained about the costs they are incurring in 
order to stay in compliance with burgeoning environmental regulations. 
The growing list of requirements thrust upon farmers and ranchers are 
largely debilitating. We heard from quite a few that were so confounded 
with the increased regulation and the sheer breadth and depth of the 
seemingly endless compliance requirements that they were seriously 
contemplating a career change. For most, the situation is beyond a 
matter of profitability for which an increased direct payment or a 
higher loan rate can compensate; it has, unfortunately, become a matter 
of survivability.
    We must put the taxpayer's money were our mouth is. We must help 
those that, by the sheer nature of their livelihoods, are ensnared by 
burdensome environmental requirements and regulation. We must offer 
increased financial assistance to help those who are willing to do the 
right thing or at least what the law requires but can't afford the cost 
of compliance.
    I am not asking the House Budget Committee to roll back 
environmental laws, rules or regulations. I am asking for the resources 
needed to help our farmers and ranchers, who are our first and best 
stewards of the land, to comply with the complex and costly web of 
federal regulation that govern land use. Our farmers and ranchers will 
be the first to tell you that their production yields are directly 
influenced by the quality of the land, air and water around them, but 
that responsible use of those elements is absolutely necessary to 
agriculture production in this country.
    There can be no reservations about the need to assist those in 
rural America comply with the numerous laws and regulations that we all 
too often thrust upon those that are least able to afford compliance.
    I support Chairman Peterson's call for additional baseline funding. 
I think it is only fair to help pay for the cost of environmental 
compliance that we've created.

    Chairman Spratt. We are up against the time limit, but you 
represent a whole Committee and one of the important items in 
our budget and we want to get your testimony fully in the 
record and fully before the Committee.
    Let me just ask you one basic question. First of all, as 
you can well appreciate, we have got a tough job because we 
would like to move the budget to balance in the year 2012, the 
same target year that the President set with his budget. We 
frankly do not think that the President's budget will get us 
there so we have got to craft a different path. And as you look 
at the Farm Bill, it is multifaceted. Among the different 
features of the Bill, which to you are the most important? 
Conservation? Price supports? Income supports? A new Bioenergy 
Bill? A new specialty crops support program of some kind? Or a 
new permanent disaster assistance program? I know I am reeling 
those off quickly, but could you give us just your reaction of 
which to you matter the most or which you think matter the most 
to farmers?
    Mr. Peterson of Minnesota. Well, I think Bob said it in his 
statement that it would depend on where you come from. In my 
part of the world, they will probably tell you it is the 
support for commodity programs because that is what they do. If 
you come from the Central Valley of California, they are 
probably going to tell you it is going to be the fruit and 
vegetable situation. If they come from, you know, the 
Chesapeake Bay area it could be conservation and environmental 
things. So I am not sure we have reached that consensus yet.
    Part of why I was not more specific in my testimony is that 
we have the commodity groups and general farm groups coming to 
a conclusion now amongst themselves about what they thing 
things should look like. We have got the conservation people 
doing that. We have got a lot of effort going into looking at 
the cellulosic ethanol and what we should be doing in those 
areas. If I had to prioritize them, I think one of the most 
important things for the future of the country is getting the 
cellulosic ethanol and these new renewable fuel opportunities 
stood up and going. And I think that is something everybody in 
the country wants, not just rural America but people in the 
city and, you know, so that is a very high priority for us.
    But it is not going to be realistic for us to, when you 
have Commodity Title down 43 percent, that we are going to take 
more money out of the Commodity Title and put it over into 
that. That is not going to work. We are going to undermine the 
safety net that we put in place. We saved $17 billion over the 
life of the Farm Bill so far because we have a safety net that 
works. And because it has worked we have a lot less baseline. 
So I would argue that we are literally the only part of the 
United States government that has contributed to the budget 
deficit situation. I do not know if you can find any other part 
of the government where we have cut spending as much as we have 
in agriculture because the program worked. And so we do not 
want to undermine that.
    Permanent disaster, I think what I am trying to do there is 
get away from these ad hoc disasters, which we have had to do 
every couple of years. Because even though we improved the 
safety net we still have not been able to get at the situation 
when we have something happen like a hurricane or a drought or 
whatever. We do not know exactly what it would cost us. We are 
not exactly sure how to structure this. But I think this would 
be a good thing for the government, for the taxpayers, for the 
budget, if we could figure out how to do this. I really believe 
that if we had a permanent disaster program, it would cost us 
half as much, or maybe less, of what we are spending on these 
ad hoc disasters. Because whenever we do one of those stuff 
gets added in there that should not be added in. People get 
paid that should not get paid, because of the legislative 
process and the other body and so forth. So, if we could have a 
formula, have a pot of money like they do in FEMA, I think it 
would cost us a lot less money. But where do we get the 
resources to do that? I mean, you know, there again you are 
robbing Peter to pay Paul.
    So we need to maintain the safety net that we have in the 
commodity program. We need a little more money for conservation 
because it was taken away from us by the appropriators. We need 
to do this renewable fuel situation. And, you know, you will 
have other people tell you that, they are from the city, that 
we need more money in food stamps even though food stamps have 
gone up 58 percent and commodities have gone down 43 percent. 
They will argue that we need to put more money into food 
stamps. So I think it depends on where you are from.
    That is probably not a very good answer.
    Chairman Spratt. Mr. Goodlatte?
    Mr. Goodlatte. I think it is a good answer, and I would 
endorse it. But let me add to that that whether you are from 
South Caroline, or Virginia, or Minnesota, or Oregon, or the 
suburbs of Kansas City, Missouri and Kansas City, Kansas, every 
where you look the question about whether a farmer will stay on 
the farm and a value that I think almost all Americans have in 
terms of wanting to see open space preserved, and not want to 
see continued taking of private lands, is the ability of that 
farmer to be able to continue to feed his family and derive 
some profit from their farm. And the two things that pressure 
them on that are increasing land prices, it is easier to sell 
that land and do something else. And that land is most likely 
not going to go to another farmer. It is going to go to some 
other use. Or it is going to be to have to spend a substantial 
amount of dollars in complying with every increasing burdensome 
environment regulations.
    So programs that make sure that we maintain the safety net 
that is very important to many farmers. Most of my farmers that 
are in livestock in Virginia do not have much of a government 
program safety net. But I strongly support maintaining that. I 
think it needs to be revised, but maintaining that for 
Midwestern and deep south farmers, and farmers in other parts 
of the country that do have important dependence upon the 
commodity programs.
    But programs that deal with conservation and deal with 
helping farmers pay to comply with environmental regulations 
that do not just benefit them but benefit all of society are 
what I think should be the focus.
    Chairman Spratt. Mr. Moore, Mr. Blumenauer, we are trying 
to hold our witnesses to ten minutes. These witnesses are 
already twice ten minutes, but the biggest issue, one of the 
biggest issues before us, is how much we provide for the 
renewal of the Farm Program. So I think it warrants the 
additional time.
    If you would like to ask a question, if I could ask you to 
ask one question and keep it fairly limited and focused I would 
appreciate it so we can move on to a host of other witnesses. 
But I think you should have the opportunity, Mr. Moore, first. 
Okay, Mr. Blumenauer.
    Mr. Blumenauer. Mr. Chairman, in respect to the people who 
are waiting and to our Chair and Ranking Member, what I would 
do would be at some point I will just try and follow up, if I 
could, specifically. It touched a raw nerve when you are 
talking about being able to help farmers comply with 
environmental regulations and the land preservation piece. 
Congressman Farr and I spent the weekend in Portland hearing 
from a wide variety of people who were concerned about that, 
and I would like to just submit some things and seek your sense 
of what we can do on this Committee to be able to do that. But 
I will do that separately because it is more detailed. I am 
sure they have information or can direct me to folks and I do 
want to respect other members. Thank you.
    Mr. Peterson of Minnesota. I got a report from Mr. Farr 
about your meeting. In fact, we had quite a discussion and 
there are a number of things we have been looking at and will 
be looking at to address these issues. And so it is definitely 
on our radar screen.
    Mr. Blumenauer. Super, thank you.
    Mr. Goodlatte. And if I might just add, between $194 
billion baseline in the last Farm Bill and $74 billion that we 
start with, excluding nutrition programs, in this one, is $120 
billion that is coming back effectively to the Budget 
Committee. There are not many other sectors of our economy 
where you have got that kind of a figure. We are not asking for 
all of that to be redirected to these other things. But we are 
asking for a significant portion of that to be made available 
for new ways to address farm programs.
    Mr. Blumenauer. I do think, Mr. Chairman, that there is a 
compelling case that it does touch everybody in America. And 
that the time is coming, I mean no one wants to water down the 
environmental regulations, or few people want to water them 
down. It is not going to happen. I do think we have an 
obligation to try and help our people who are on the farms and 
ranches that benefit us all. And I am looking forward to 
exploring that with you. Thank you very much.
    Chairman Spratt. Mr. Berry, we are trying to hold the 
witnesses to ten minutes. We are well over because this is such 
an important this year with the Farm Bill coming due. You are a 
rice farmer and a cotton farmer, if you have a question to put 
we would be glad to entertain it.
    Mr. Berry. Well, thank you Mr. Chairman. And I have served 
on the Ag Committee with my colleagues Mr. Peterson and Mr. 
Goodlatte and I welcome you certainly to the Budget Committee, 
and we appreciate you being here. I think we share, you just 
described, the Ranking Member just described the fact that we 
did not spend all the money in the last Farm Bill. And I do not 
think that the American people realize the tremendous benefit 
that they reap from having a good Safety Net Program for our 
producers, and a good Conservation Program for the land owners 
and to help encourage people to get the job done as far as 
land. I have been involved with it all my life. And it is 
always interesting the way occasionally it is presented as if 
someone is enriching themselves from farm programs. And I 
always encourage people that if they think it is the road to 
wealth, I know where they can get in on it. I know plenty of 
people that will sell them one.
    As I said, I have spent my entire life on the farm and 
involved with agriculture and around farmers. And they are just 
good, hardworking people. There is no way that the production 
and processing system in this country will hold up and continue 
to be as productive as it is and has been and continue to 
provide America with the cheapest and the safest food supply 
and fiber supply in the world without a Safety Net Farm Bill 
behind them. And there is no way we are going to have water as 
clean as we have, and air as clean as we do without the 
conservation programs. And without getting into a whole lot of 
details, I just think it is absolutely critical that we put 
enough money in this budget to write a good Farm Bill.
    Chairman Spratt. Thank you very much for your testimony. We 
appreciate your coming here, and we appreciate your excellent 
statements as well.
    Mr. Peterson of Minnesota. Thank you, Mr. Chairman.
    Mr. Goodlatte. Thank you, Mr. Chairman.
    Chairman Spratt. We look forward to working with you on a 
bill we can all support. The next witness is Mr. Dennis Cardoza 
and he will be followed by Norman Dicks. Mr. Cardoza, if you 
could keep your statements to a little less than ten minutes so 
that we can accommodate a few questions we would appreciate it, 
but the floor is yours.

STATEMENT OF HON. DENNIS CARDOZA, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF CALIFORNIA

    Mr. Cardoza. I will do better than that. I want to respect 
Mr. Dicks, Mr. Chairman and all the members here. But the issue 
I do want to talk about today is very important. And I have 
submitted written testimony to the Committee but I will try and 
summarize a little bit why I have taken your time up today.
    A few years ago, Mr. Chairman, actually seven years ago, I 
was fortunate enough, my wife and I were fortunate enough to 
adopt two children out of foster care. Since then I have been 
an advocate for these children. There are over 211,000 children 
currently in foster care across the country that are being 
helped by the $6.8 billion in funds that the federal government 
gives the states to allocate. That money is needed, but I will 
tell you that there are some other, and I would ask this 
Committee to give the full allocation to those children. There 
are actually 427,000 children in foster care, 211,000 are 
supported by the funds given, that are seeking families, 
211,000 children are getting funding from the federal 
government.
    Last year, Mr. Chairman, I authored an amendment to the 
Science, State, Justice and Commerce Appropriations Bill that 
provided $5 million for drug endangered children. There was 
actually an authorization for $20 million included in the 
Patriot Act. To date it has not been funded because last year's 
$5 million amendment lapsed in the earmark process that we just 
saw go through the House.
    So I am asking that we fully fund this program, Mr. 
Chairman and members. These drug endangered children grants 
provide grants to children to improve coordination between 
state and local agencies that provide assistance to children 
found in homes made dangerous by drugs, and to aid the 
transition of these children to safe residential environments. 
This amendment was adopted by a voice vote last year, and as I 
said it did not pass. Mr. Chairman, both of my children came 
from the same drug endangered home. It is a despicable 
situation where so many kids are left in abusive situations 
because of their parents' addiction to serious drugs, including 
and in particular methamphetamine. It is absolutely vital that 
we do everything we can to get those children out of those 
homes and placed in more secure environments.
    My children were saved out the foster care system and 
placed in my wife and my home because of court appointed 
special advocates, which is the second program that I would 
like to advocate for you today. I urge you to fully fund that 
program. I will tell you that it was a CASA volunteer who was 
my son's kindergarten teacher who realized that they were being 
abused a second time in foster care, and were able to get them 
to the social service agency that got them to my wife and I. 
And I am forever in their debt and for every year that I come 
here I will testify on their behalf. We need more CASA 
volunteers, not less. The program has been cut in the last few 
years, we need to change that around. It is a small program, 
considering that we spend $6.8 billion on foster care we only 
spend $12 million on CASA. And I will tell you that dollar for 
dollar we could do much better putting more dollars in this one 
than in anything else we can do.
    Chairman Spratt. Mr. Cardoza, does this fall under the 
Child Care and Development Block Grant?
    Mr. Cardoza. I am not sure, Mr. Chairman. I will try and 
find that out for you and provide you with that information 
afterwards.
    Chairman Spratt. Okay. Okay.
    Mr. Cardoza. But the CASA funding, you know I have done 
bake sales and fundraisers for CASA because I think it is that 
important. And it truly is something that we must do.
    Finally Mr. Chairman, I am going to advocate to all of you 
to fully fund the SCHIP Program, and not just to the age of 
nineteen, or below the age of eighteen. But I am going to 
advocate that we extend it, it is currently a voluntary 
program, to twenty-one. And it is imperative that we fully fund 
that program at least in one particular area, and that is for 
mental health services.
    I was shocked recently when I read in the paper that 40 
percent of foster kids, according to this one article, are 
homeless after eighteen months when they age out of the foster 
care system. The reality is that large numbers, and it is in my 
written testimony, are on psychotropic drugs because of the 
abuse and the neglect that they sustained as children. I never, 
to be very frank and honest, before I had my own children that 
came out of this situation I did not realize how bad the 
nurturing process can affect, or the lack of nurturing, at an 
early age can affect children. But it drastically does. We see 
that--well, I can read you some of the statistics I included in 
my testimony. The incidence of drug dependence among foster 
kids is seven times greater than the general public. More than 
half of foster care alumni ages nineteen to thirty-three had 
mental health problems, so 50 percent. And 20 percent of foster 
kids have three or more mental problems.
    Well, Mr. Chairman what happens to foster kids is they are 
already coming out of unstable environments. And then they age 
out at eighteen, they get thrown pretty much on the streets 
with very few social services that follow them. And they are 
expected to get jobs and start supporting themselves. But the 
problem is that just at the time when they are supposed to 
really step it up and take responsibility for their lives, the 
psychotropic drugs that are helping them become stable and cut 
off for lack of health services. So what we need to do, Mr. 
Chairman, is continue this program to give them a fair chance 
at a good start in life. Certainly a lot of these kids are 
going to fail anyway because of the disadvantages they have. 
But we should not be withholding their medication at the most 
critical time that they possibly can have when they have no one 
else in their lives to help shepherd them after they age out.
    I will tell you I have spoken to a lot of these kids, Mr. 
Chairman. It is a very serious problem. And it is a shame to 
spend billions of dollars trying to save these kids only to 
lose them for lack of a few drugs right at the end of their 
care. I believe, Mr. Chairman, I know you cannot score this in 
the congressional budget scoring process correctly, but this is 
a lot like Head Start where we know if we take care of them at 
the beginning they are healthier and it costs government less 
money. I believe that if we take care of these kids as they age 
out of the process that we will in fact save the government 
money by these kids not becoming homeless, not committing 
crimes on the street, not being put in our penal facilities and 
costing taxpayers much more money in the long run. And with 
that, Mr. Chairman, I just ask for your help in supporting this 
issue.
    [The prepared statement of Mr. Cardoza follows:]

   Prepared Statement of Hon. Dennis A. Cardoza, a Representative in 
                 Congress From the State of California

    Thank you for allowing me to submit this statement for the record 
on an issue very close to my heart: our nation's foster children. The 
kids in our foster care system are among the most vulnerable in our 
society, and I urge the Committee to make protecting foster care 
children a top priority as it goes about drafting its budget 
resolution.
    I have a very personal interest in this issue. Seven years ago, I 
adopted two foster children. Since then, I have advocated on behalf of 
adoption and foster children in the California Assembly and in 
Congress. Every child, no matter what station they may be born to, 
deserves a chance to be raised in a stable and loving home.
    As you consider this year's budget resolution, I urge you at the 
very minimum to maintain the $6.8 billion in the Administration budget 
for state grants for foster care and adoption assistance. Every month, 
these funds support 211,000 children in foster care across the country 
and help 427,000 children as they seek permanent families.
    I also believe that we must maintain full funding for the State 
Children's Health Insurance Program (SCHIP). I was deeply troubled by 
the shortfall in long term funding for the program in President Bush's 
budget. As you know, we would need an additional $10 billion over the 
next five years just maintain the number of children enrolled. A 
failure to continue to support this vital program would have a 
devastating impact on children, especially foster children.
    The Court Appointed Special Advocates (CASA) program is one that 
literally saved my life and I urge the Committee to strongly support 
it. Under the CASA program, funding is provided to the National Court 
Appointed Special Advocates Association to initiate and expand local 
programs that provide volunteer advocates to children who are victims 
in child abuse or neglect cases. Slightly over 200,000 children went 
through the system last year and I strongly urge the Committee to 
support the authorized funding level of $12 million.
    Last year I authored an amendment to the Science, State, Justice, 
and Commerce Appropriations bill to provide $5 million for the Drug 
Endangered Children grant program. The Drug Endangered Children grant 
program provides grants to improve coordination between the state and 
local agencies that provide assistance to children found in homes made 
dangerous by drugs and to aid the transition of these children to safe 
residential environments. The amendment was adopted by voice vote 
during consideration of the bill but, unfortunately, it got lost in the 
conflict of competing priorities during consideration of this year's 
continuing resolution. I urge the Committee to give this vital program 
top consideration.
    Moreover, I plan to introduce legislation which would expand 
Medicaid to cover children up to the age of 21. With meager resources 
and despite chronic funding shortfalls, the SCHIP program has made 
remarkable strides in helping children living in poverty get access to 
health care.
    Though the program has made significant progress, it should only be 
viewed as a first step and much more needs to be done. The bill I plan 
to introduce would correct a huge problem under current law--the fact 
that only children under 19 are covered. We know that poverty still 
afflicts children in their late teens and early twenties and, by 
acknowledging and addressing this reality, we can make real progress 
towards reducing childhood poverty.
    This will dramatically help the 23,000 children who have age out of 
foster care every year and who are no longer eligible for health care. 
The statistics are sobering: 1) incidents of drug dependence are 7 
times greater with foster care alumni than the general public; 2) more 
than half of foster care alumni ages 19 to 33 had a mental health care 
problem, and 20% had three or more mental health problems; 3) more than 
80% of children in foster care have developmental, emotional or 
behavioral problems; and 4) according to Health and Human Services, 75-
80% of those children who need mental health services do not receive 
them.
    By expanding access to health care for those children who need it, 
we can begin to put a dent in some of those horrendous statistics. My 
bill will help close the gap and make a difference in the lives of 
these at-risk youth.
    Looking beyond this budget resolution, I strongly believe that 
Congress should act to eliminate obstacles to adoption and improve life 
for kids in foster care. In the past, I have sought to make foster care 
a priority for Congress. In April of 2005, I introduced the ``Military 
Adoption Act'', which makes it easier for military service members to 
adopt children by allowing them to take paid leave. The bill was signed 
into law by President Bush in December 2005.
    I know the Committee has an unenviable task of choosing among many 
worthwhile priorities as it drafts its budget resolution. There is 
simply too much to do and not enough money to go around.
    However, the welfare of our nation's youth must be a top priority. 
Simply put, no child should have to grow up abandoned and in poverty. 
Please do everything you can to ensure that the needs of children are 
well protected during the budget process.

    Chairman Spratt. That is very compelling testimony. I live 
across the street and have all my life from a church owned 
facility which treats children with deep seated emotional 
problems, many of them coming, most of them coming, from 
abusive and broken home situations. So you certainly have my 
sympathetic support. If you could supply for us a little better 
identification of the program and under what rubric of the 
budget it falls that would be useful, I think.
    Mr. Cardoza. I will indeed. I intend to introduce 
legislation to authorize and fully mandate the extension on the 
mental health services. I intend to with Mr. Kennedy and others 
to try and move this legislation as the Mental Health Parity 
legislation goes through. But I wanted to warn the Committee 
that I was doing this so that you could be thinking about it, 
and I will be working on it as well.
    Chairman Spratt. Renewing and extending the SCHIP Program 
will be one of our principal focal points and main emphases in 
the budget this year. Mr. Moore?
    Mr. Moore of Kansas. Thank you Mr. Cardoza, Mr. Chairman. 
As a district attorney, elected district attorney, in the 
suburb of Kansas City for twelve years I prosecuted several 
homicide cases involving small children, and frankly that is 
exactly why I ended up leaving the position of district 
attorney after twelve years. And I was one of the founders of 
the CASA Program in our county. And I will tell you, I have 
seen it and what you just said is exactly right. It is a very, 
very valuable resource, court appointed special advocates. 
Having an adult in the community who will go in and advocate 
for a child who needs that help is very, very helpful, I think, 
in many, many situations.
    As Mr. Chairman just said, full funding for SCHIP is 
absolutely mandatory as far as I am concerned, as well. Thank 
you for testifying today.
    Mr. Cardoza. Thank you.
    Chairman Spratt. Mr. Blumenauer?
    Mr. Blumenauer. Compelling testimony, agreed. It makes a 
lot of sense. You referenced a number of young people who age 
out, as you say, from foster care who end up on the streets?
    Mr. Cardoza. Well, I have had conflicting statistics on 
this. But I have heard a statistic that says 40 percent. I have 
heard other statistics that are less than that. But there is a 
tremendous number, Mr. Blumenauer.
    Mr. Blumenauer. Thank you.
    Mr. Cardoza. Tremendous. And I will look into it and get 
you personally further information on that.
    Chairman Spratt. Other questions? Mr. Cardoza, thank you 
very much, indeed.
    Mr. Cardoza. Thank you very much, Mr. Chairman.
    Chairman Spratt. We appreciate it. Mr. Norman Dicks?

 STATEMENT OF HON. NORMAN DICKS, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF WASHINGTON

    Mr. Dicks. Mr. Chairman, I appreciate your taking the time. 
I hope they will pass out our testimony. We have a wonderful 
chart on the first page we want you to take a look at. And I 
appreciate the opportunity to testify. I appreciate the 
opportunity to appear before you this afternoon to share my 
views on the fiscal year 2008 budget and, really, what has 
happened between 2001 and 2008. I think most of us who serve on 
the Budget and Appropriations Committees are aware of the 
constraints which have been placed on discretionary spending 
during the last half dozen years and tax policies and war costs 
have drained the Treasury of funds for basic service and 
critical investments. There are serious shortfalls in 
education, health services, research, and other areas which 
others will testify about today. I believe these are all 
critical challenges which we need to address, and I hope that 
we will be recognizing in the budget which you will present to 
the House next month. Mr. Chairman, there are other needs which 
also need to be addressed in the 2008 budget. My request today 
is that shortfalls in environmental and conservation programs, 
which have reached critical proportions, will also be 
adequately funded in your budget.
    The numbers regarding funding for environmental and natural 
resource programs under Budget Function 300 tell a discouraging 
story. As the Budget Committee's own analysis, released last 
week, shows, the 2008 request for Function 300 programs of 
$28.7 billion is $2.8 billion, or 8.3 percent less, than the 
amount required to maintain current services. Funding for the 
Environmental Protection Agency is reduced by $508 million. The 
budget for the Forest Service, not counting firefighting costs 
which are really uncontrollable, is down $343 million. 
Excluding the welcome increase for our national parks, funding 
for the Interior Department is reduced by $237 million. These 
2008 proposed cuts come on top of seven years of steady 
decline. As the chart included in my written testimony shows, 
after adjusting for inflation, funding for the Interior 
Department has declined by 16 percent since 2001, for EPA by 29 
percent, and for the non-fire portions of the Forest Service by 
a whopping 35 percent. These cuts have inevitably lead to 
declines in services for visitors to our parks, refuges and 
forests and to dramatic reductions in assistance to state and 
local governments for environmental and conservation 
activities.
    Mr. Chairman, I know that your Committee understands the 
impact which these reductions mean in a broad sense. But I want 
to impress on you today what this means in terms of direct 
services to the public we all serve. Under the President's 2008 
budget, funding to help our local communities repair and 
upgrade the water and sewer systems would decline by $662 
million, or approximately 50 percent since 2004. This is 
despite EPA's own estimate under Governor Christine Todd 
Whitman of a shortfall of at least $388 billion for water and 
sewer systems. Mr. Chairman, there is not a community in this 
country that does not need help with its water infrastructure, 
and without these investments drinking water related health 
problems will increase and economic growth will be curtailed.
    Air quality grants are reduced by $35 million at a time 
when EPA has designated 208 American counties with a population 
of 88 million as failing to meet air quality standards under 
the Clean Air Act. Areas designated as EPA as not meeting air 
quality standards include Columbia and Spartanburg in your 
State of South Carolina, and Milwaukee, Racine and Sheboygan in 
Mr. Ryan's State of Wisconsin. These areas need our help.
    The annual level of clean up of Super Fund Sites 
contaminated with PCB's and other highly toxic substances has 
declined from eighty sites per year in the late nineties to 
twenty-four sites estimated for this year and next under the 
President's proposal.
    Funding for the Land and Water Conservation Fund to acquire 
precious land for recreation and species habitat has declined 
from $440 million in 2002 to $85 million under the President's 
2008 request. I am not proposing money to acquire large new 
tracts of land or establish new parks and wildlife refuges. If 
funds are restored they will go mostly to acquire remaining 
private properties in places like Valley Forge, Grand Teton 
National Park, and the Flight 93 Memorial Site. All purchases 
are from willing sellers.
    Since 2001 staffing in the Forest Service has declined by 
5900 positions making it more difficult to provide services 
either to recreational visitors or to commercial timber 
projects. Hundreds of Forest Service campgrounds are being 
closed for lack of funding and our forests are overrun with 
drug traffickers for lack of law enforcement personnel. 
Staffing at the Fish and Wildlife Service has declined by 400 
positions over the last two years. Many refuges out there do 
not have one single person anymore to take care of them.
    Mr. Chairman, my basic request, my urgent plea, is that 
your Committee recognizes in its Budget Resolution for 2008 
that the environmental and conservation needs of this country 
have been neglect too long. I urge this Committee to reverse 
this trend and provide a significant increase for discretionary 
spending so that all of these deficits can begin to be 
addressed.
    Mr. Chairman, in addition to my testimony regarding 
environmental and conservation needs broadly, I want to make a 
specific request regarding the way the firefighting costs are 
being dealt with under the budget. Frankly, the fire budget is 
exploding as fires become more common, more severe, and more 
expensive. These increased costs are causing havoc for other 
Forest Service and Interior programs. As members know, funding 
for other programs has been reduced by hundreds of millions of 
dollars as funds are borrowed at the last minute to finance the 
cost of fire suppression activities. In many cases, these funds 
are never repaid and critical maintenance and hazardous fuels 
work does not get done.
    Mr. Chairman, these fire events are natural disasters every 
bit as much as hurricanes, tornadoes, and floods. The costs, 
however, are not treated like other emergencies whose costs are 
covered either by the FEMA or by the emergency funds outside of 
the discretionary caps. Mr. Chairman, we recognize that a 
certain amount of fire expenditures are a recurring and 
predictable expense and should be paid from discretionary 
funds. I believe, however, that when there is a specially 
catastrophic and expensive fire, or when costs substantially 
exceed those of a normal year that alternative funding 
arrangements need to be made.
    I would urge your Committee to either provide an emergency 
reserve fund of $500 million, as was done in 2004 and 2005 for 
extraordinary fire costs as we did those last two years, or 
provide an alternative mechanism for handling these costs when 
fires get out of hand. Funding highly variable and highly 
unpredictable fire fighting costs out of core discretionary 
budget does not make sense. In fact, in 1991 13 percent of the 
budget for the Forest Service was for fire. Today it is up to 
somewhere close to between 45 and 47 percent of the entire 
Forest Service budget goes to fighting fire.
    So these are important matters. I have taken over the 
responsibility as Chairman of the Interior and Environment 
Appropriations Subcommittee, and as I showed you on this first 
chart these cuts are not sustainable. I mean, these agencies 
are being hurt and we need help both from the Budget Committee 
and from the allocation that we get in the 302b process. Thank 
you.
    [The prepared statement of Mr. Dicks follows:]

    Prepared Statement of Hon. Norman D. Dicks, a Representative in 
                 Congress From the State of Washington

    Chairman Spratt and Members of the Committee, I appreciate this 
opportunity to appear before you this afternoon to share my views on 
the fiscal year 2008 budget.
    I think most of us who serve on the Budget and Appropriations 
Committees are aware of the constraints which have been placed on 
discretionary spending during the last half dozen years as tax policies 
and war costs have drained the treasury of funds for basic services and 
critical investments. There are serious shortfalls in education, health 
services, research and other areas which others will testify about 
today. I believe these are all critical challenges which we need to 
address and I hope they will be recognized in the budget which you will 
present to the House next month.
    But, Mr. Chairman, there are other needs which also need to be 
addressed in the 2008 Budget. My request today is that shortfalls in 
environmental and conservation programs--which have reached critical 
proportions--will also be more adequately funded in your budget.
    The numbers regarding funding for environmental and natural 
resource programs under budget function 300 tell a discouraging story. 
As the Budget Committee's own analysis released last week shows, the 
2008 request for function 300 programs of $28.7 billion is $2.8 billion 
or 8.3 percent less than the amount required to maintain current 
services. Funding for the Environmental Protection Agency is reduced by 
$508 million. The budget for the Forest Service, not counting 
firefighting costs, is down $343 million. Excluding the welcome 
increase for our National Parks, funding for the Interior Department is 
reduced by $237 million.
    These 2008 proposed cuts come on top of seven years of steady 
decline. As the chart included in my written testimony shows, after 
adjusting for inflation, funding for the Interior Department has 
declined by 16 percent since 2001; for EPA by 29 percent; and for the 
non-fire portion of the Forest Service by a whopping 35 percent. These 
cuts have inevitably led to declines in services for visitors to our 
parks, refuges and forests and to dramatic reductions in assistance to 
states and local communities for environmental and conservation 
activities.
    Mr. Chairman, I know that your Committee understands the impact 
which these reductions mean in a broad sense. But I want to impress on 
you today what this means in terms of direct services to the public we 
all serve.
     Under the president's 2008 budget, funding to help our 
local communities repair and upgrade the water and sewer systems would 
decline by $662 million or approximately 50 percent since 2004. This is 
despite EPA's own estimate under Governor Christine Todd Whitman of a 
shortfall of at least $388 billion. Mr. Chairman there is not a 
community in this country that doesn't need help with its water 
infrastructure and without these investments drinking water-related 
health problems will increase and economic growth will be curtailed.
     Air quality grants are reduced by $35 million at a time 
when EPA has designated 208 American counties with a population of 88 
million as failing to meet air quality standards under the Clean Air 
Act. Areas designated by EPA as not meeting air quality standards 
include Colombia and Spartanburg in your State of South Carolina, and 
Milwaukee-Racine and Sheboygan in Mr Ryan's state of Wisconsin. These 
areas need our help.
     The annual level of clean-ups of Superfund sites 
contaminated with PCB's and other highly toxic substances has declined 
from 80 sites per year in the late 1990's to 24 sites estimated for 
this year and next under the president's proposal.
     Funding from the Land and Water Conservation Fund to 
acquire precious land for recreation and for species habitat has 
declined from $444 million in 2002 to $85 million under the president's 
2008 request. I am not proposing money to acquire large new tracts of 
land or to establish new parks and wildlife refuges. If funds are 
restored, they will go mostly to acquire remaining private properties 
in places like Valley Forge, Grand Teton National Park and the Flight 
93 Memorial site. All purchases are from willing sellers.
     Since 2001, staffing in the Forest Service has declined by 
5900 positions making it more difficult to provide services either to 
recreational visitors or to commercial timber projects. Hundreds of 
Forest Service campgrounds are being closed for lack of funding and our 
forests are overrun with drug traffickers for lack of law enforcement 
personnel.
     Staffing at the Fish and Wildlife Service has declined by 
400 positions over the last two years.
    Mr. Chairman, my basic request--my urgent plea--is that your 
Committee recognizes in its Budget Resolution for 2008 that the 
environmental and conservation needs of this country have been 
neglected too long. I urge this Committee to reverse this trend and 
provide a significant increase for discretionary spending so that all 
of these deficits can begin to be addressed.
    Mr. Chairman, in addition to my testimony regarding environmental 
and conservation needs broadly, I want to make a special request 
regarding the way that firefighting costs are being dealt with under 
the budget. Frankly, the fire budget is exploding as fires become more 
common, more severe and more expensive. These increased costs are 
causing havoc for other Forest Service and Interior programs. As 
Members know, funding from other programs has been reduced by hundreds 
of millions of dollars as funds are ``borrowed'' at the last minute to 
finance the cost of fire suppression activities. In many cases these 
funds are never repaid and critical maintenance and hazardous fuels 
work does not get done.
    Mr. Chairman, these fire events are natural disasters every bit as 
much as hurricanes, tornadoes and floods. The costs, however, are not 
treated like other emergencies whose costs are covered either by the 
Federal Emergency Management Administration or by emergency funds 
outside of the discretionary caps. Mr. Chairman, we recognize that a 
certain amount of fire expenditures are a recurring and predictable 
expense and should be paid from discretionary funds. I believe, 
however, that when there is an especially catastrophic and expensive 
fire or when costs substantially exceed those of a normal year that 
alternative funding arrangements need to be made. I would urge your 
Committee to either provide an emergency reserve fund of $500 million 
for extraordinary fire costs as we did two years ago, or provide an 
alternative mechanism for handling these costs when fires get out of 
hand. Funding highly variable and highly unpredictable fire fighting 
costs out of our core discretionary budget just does not make sense.
    Thank you for your consideration to this request.

    Chairman Spratt. Mr. Dicks, thank you for excellent 
testimony and great presentation of what is obviously an area 
that needs our attention, your attention, the whole House's 
attention. Can you give us some idea of how we could pay for 
these increments, these additional needs? For example, fees or 
transfer of funds from elsewhere, other allocations?
    Mr. Dicks. One thing we do do already, we have visitors' 
fees for the Park Service and for the Forest Service. In some 
places they are controversial but overall they have been 
accepted by the public. The money comes in, is used for 
maintenance, used for other activities at these facilities. You 
know, we have the Land and Water Conservation Fund, here is 
another problem. Mr. Secretary Watt, do you remember James Watt 
in the Reagan administration? He said that the money coming in, 
this was not a mandatory money to expend the money. So we have 
collected about $15 billion that has just gone into the 
Treasury under Land and Water Conservation and it has not gone 
out for the conservation needs of the country.
    So, you know, a few years ago we had a bill in the House 
called CARA. I, as an appropriator, was not supposed to vote 
for it. I voted for it because that was I figured the only way 
we are going to get the kind of money to deal with some of 
these problems. Now, there is an opportunity right there under 
Land and Water Conservation to do $900 million if we as a 
Congress made that program mandatory and that money would go 
out and be used to acquire lands and do other environmental 
things at the state and federal level.
    So, we have go to do something. I mean, these things, I 
mean, what has happened here is with the priorities of the 
administration being the War and tax cuts they have 
shortchanged these programs. And we are pleased about the 
increase in the money for the Park Service. But it is coming at 
the expense of cuts in every other area of the environmental 
budget. So we need help. We need relief.
    Chairman Spratt. What about the allocation of funds from 
off shore drilling?
    Mr. Dicks. That is what I am talking about. That is the 
Land and Water Conservation funding.
    Chairman Spratt. Right.
    Mr. Dicks. And we gave some of that money to the oil 
producing states. I am saying we now should give some of the 
money to the rest of the country for environmental needs across 
the country. That is one place we could go to get some extra 
money.
    We also, by the way, the President's budget calls for $100 
million increase, actually $3 billion over ten years, for the 
Park Centennial. $100 million of that is mandatory spending, so 
the Natural Resources Committee has got to come up with a PAYGO 
to get $100 million. And then the administration is committed 
to going out and raising $100 million each year from the 
private sector. So that is another way to pick up $2 billion if 
we can find a way to come up with a program to deal with that. 
But that is the Resources Committee that would have to do that.
    Chairman Spratt. Do other members have questions? Yes, sir.
    Mr. Porter. Thank you, Mr. Chairman, not really a question 
but a comment. Congressman Dicks, we appreciate your comments. 
As a member from the great State of Nevada I represent the Lake 
Mead National Recreation Area, one of the most visited national 
recreation areas in the country with millions of visitors every 
year. I appreciate you making this a priority because it is a 
serious challenge for us, also, you know, adjacent to the Las 
Vegas area where we have 42 million visitors. Many of our 
National Park Service employees are expected to be law 
enforcement, expected to be environmentalists, and expected to 
be tour guides. And there is a serious shortfall and I 
appreciate you bringing this before the Committee today.
    Mr. Dicks. Well, one good thing about the President's 
proposal on the Parks is he is going add 1000 full time FTEs 
for the National Parks and 3000 temporary workers for the 
National Parks. So there is some relief for that one area. But 
that does not affect the Forest Service and the other areas 
that are cut back in order to put money into the Park Service.
    Mr. Porter. Well said. Thank you, Mr. Chairman.
    Mr. Moore of Kansas [presiding]. Other members have 
questions? Mr. Blumenauer?
    Mr. Blumenauer. Thank you. Congressman Dicks, eloquent and 
forceful. I really appreciate your testimony and the work that 
you have been doing to try to pull us back from the brink. 
Following up on the Chairman's question to you about things we 
can do, would you support, does it seem reasonable for us to go 
back, you mentioned in your testimony we are only going to have 
a couple dozen Super Fund sites despite the problems across the 
country?
    Mr. Dicks. You mean to go back to the tax?
    Mr. Blumenauer. Yes, to reinstitute the Super Fund tax?
    Mr. Dicks. Yes, I do think we need to do that. I mean, so 
we have more money to clean up these Super Fund sites quicker. 
I mean, that will help all of our environmental needs. So I am 
for that. It is not, you know, the tax issues of course are 
with the Ways and Means Committee.
    Mr. Blumenauer. I also appreciate your clarifying the 
explosion of, probably the wrong choice of terms, but fire 
fighting costs. I am wondering if there is a way to couple, the 
emergency reserve I am sensitive to.
    Mr. Dicks. Right.
    Mr. Blumenauer. That makes some sense to me.
    Mr. Dicks. If we do not do that they have to take the money 
out of other important accounts dealing with the environment 
and running the Forest Service.
    Mr. Blumenauer. Agreed. But at the same token, we have 
federal policies that are driving up the costs of forest 
fighting.
    Mr. Dicks. That is right.
    Mr. Blumenauer. The next twenty years there is going to be 
another million people who are going to live in metropolitan 
Denver, for instance, and that is what is driving up the costs 
of forest, if it is out in remote areas the costs of forest 
fighting, fighting forest fires, are a hundredth of what they 
are when you have got people, recreational homes, and 
development involved. Is there a way that we could couple your 
very reasonable request of a reserve, a contingency, something 
that would be truly emergency funding, with policies that will 
stop restraining stupid activities on the part of the federal 
government that are putting more property and lives at risk and 
driving that cost up?
    Mr. Dicks. Well, is it the federal government or is it the 
local governments that are allowing this development to occur 
near urban areas? That to me is more of a zoning issue that has 
to be dealt with at the state and local level. But they are 
allowing people to do it, and you are right. It is those areas 
that are the most expensive. It is hugely more expensive.
    What we are also trying to do, remember, is also under 
health forests is to go in and do the cleaning out of the under 
storage so that the fires are not as intense. And to me, that 
makes sense. That is underfunded in this budget as well.
    Mr. Blumenauer. Well, I would like to explore with you if 
we could in the capacity of what we do on the Budget Committee, 
I am also interested in things that we can do on the Ways and 
Means Committee to make it hard to do stupid things. Like we 
have done with flood insurance where repetitive flood losses we 
have made some adjustments. And maybe there is a way we could 
structure something that would be win-win, make your job 
easier, reduce prices, and would be a cooperative effort.
    Mr. Dicks. Yes, I would be glad to work with you on that, 
as we always have over the years.
    Mr. Blumenauer. Thank you very much. Thank you.
    Mr. Moore of Kansas. And we are out of time. I thank the 
gentleman.
    Mr. Blumenauer. I completely understand.
    Mr. Moore of Kansas. Thank you, sir.
    Mr. Blumenauer. And thank you.
    Mr. Moore of Kansas. The next person to testify is Julia 
Carson. Ms. Carson, if you would come forward please we are 
pleased to welcome you to the Committee and to accept your 
testimony. And you are recognized, Ms. Carson, for ten minutes.

 STATEMENT OF HON. JULIA CARSON, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF INDIANA

    Ms. Carson. Thank you very much, Mr. Chairman, for allowing 
me to testify before this powerful committee, the Budget 
Committee.
    The President's budget cuts funding for programs that are 
vital to the senior citizens of this country. It does not 
include funding that would ensure homeless veterans a safe and 
affordable place to live. This year, the President's budget 
again eliminates funding for the Commodity Supplemental Food 
Program. The CSFP provides monthly nutritious food packages, 
including fresh produce, meats and other items to 553,000 
seniors, women and children. In fiscal year 2006, 90 percent of 
the program recipients were elderly or with income levels at or 
below approximately $12,500 annually.
    As in the fiscal year 2007 proposal, this year's proposal 
would have current recipients enrolled in a traditional food 
stamp program once the CSFP is eliminated. For this indigent 
senior population food stamp vouchers are not an acceptable 
replacement to this program. Food stamp vouchers do not offer 
the same flexibility and would drastically reduce the already 
meager dollar value benefit provided by CSFP.
    It is incomprehensible, Mr. Chairman, members of the 
Committee, that this cherished generation, many of which rely 
on the program, could be treated with such disregard. In 
Indiana, 4,350 seniors are currently enrolled in the program. 
On average, these individuals in my home state earn only $700 
to $800 a month, leaving little if any to sustain a healthy 
diet. In Indianapolis, Gleaners Food Bank implements CSFP 
Program. Volunteers deliver food boxes to personal homes and 
senior housing projects for those immobilized by ill health, 
physical infirmities, or lack of transportation. The program is 
not a luxury, Mr. Chairman and members of the Committee, it is 
a necessity to prevent hundreds of thousands of seniors as well 
as thousands of women and children from going hungry throughout 
the country. I urge you to consider these individuals and would 
appreciate your support of this invaluable program.
    And as you prepare the budget, in addition to making cuts 
in a program that would ensure food security for seniors, the 
President has made no attempt to fund the Veterans Affairs 
Supportive Housing Program. The President has signed this 
program into law on two occasions, from 2001 and then 
reauthorized the program in 2006. The administration has failed 
to request funding now for this valuable program. The FASP 
Program provides permanent subsidies and case management 
services to homeless veterans with mental and addictive 
disorders. The Department of Veterans Affairs screens homeless 
veterans for program eligibility and provides case management 
while HUD allocates rental subsidies from the Housing Choice 
Voucher Program. In the first year the program was authorized, 
had it been funded, it would have provided 500 HUD vouchers and 
in the subsequent years an additional 500 would have been 
added. This is the only program that HUD targets veterans and 
at the same time provides supportive services.
    The report entitled ``Ending Homelessness Among Veterans 
Through Permanent Supportive Housing''by the Supportive Housing 
National Coalition for Homeless Veterans and Volunteers of 
America shows that permanent housing combined with supportive 
services helps prevent and end homelessness among our precious 
veterans. As more and more troops come home from Iraq and 
Afghanistan the VA will be facing a major crisis. The VA 
estimates that approximately 400,000 veterans would experience 
homelessness and at some point during the year they can only 
provide assistance for a quarter of them.
    I appreciate your time and encourage you to consider the 
vulnerable seniors and veterans who desperately need our 
support through these times through initiatives when crafting 
the fiscal year 2008 budget. I appreciate members of the 
Committee for your attention and would encourage you to give 
these requests your serious consideration.
    [The prepared statement of Ms. Carson follows:]

 Prepared Statement of Hon. Julia Carson, a Representative in Congress 
                       From the State of Indiana

    Thank you Mr. Chairman for allowing me to testify before the 
Committee on the FY08 budget. The President's budget cuts funding for 
programs that are vital to the senior citizens of this country and does 
not include funding that will ensure homeless veterans a safe and 
affordable place to live.
    This year, the President's budget again eliminates funding for the 
Commodity Supplemental Food Program. The CSFP provides monthly 
nutritious food packages including fresh produce, meats and other items 
to 553,000 seniors, women and children. In FY06, 90 percent of the 
program recipients were elderly individuals, all with income levels at 
or below approximately $12,740 per year.
    As in the FY07 budget proposal, this year's proposal would have 
current recipients enroll in a transitional food stamp program once the 
CSFP is eliminated. For this indigent senior population, food stamp 
vouchers are not an acceptable replacement to the program. Food stamp 
vouchers do not offer the same flexibility and would drastically reduce 
the already meager dollar value benefit provided by the CSFP. It is 
incomprehensible that this cherished generation, many of which rely on 
the program, could be treated with such disregard.
    In Indiana, 4,350 seniors are currently enrolled in the program. On 
average these individuals in my home state earn only $700-$800 a month, 
leaving little, if any, to sustain a healthy diet. In Indianapolis, 
Gleaners Food Bank administers the CSFP program. Volunteers deliver 
food boxes to personal homes and senior housing sites for those 
immobilized by ill health, physical infirmities, or lack of 
transportation.
    This program is not a luxury, rather it is a necessity to prevent 
hundreds of thousands seniors as well as thousands of women and 
children from going hungry throughout the country. I urge you to 
consider these individuals and would appreciate your support of this 
invaluable program and as you prepare the budget.
    In addition to making cuts to a program that will ensure food 
security for seniors, the President has made no attempt to fund the 
Veterans Affairs Supportive Housing (VASH) program. The President has 
signed this program into law on two occasions, first in 2001 and then 
reauthorized the program in 2006. The Administration has failed to 
request funding for this valuable program.
    The VASH program provides permanent subsidies and case management 
services to homeless veterans with mental and addictive disorders. The 
Department of Veterans Affairs screens homeless veterans for program 
eligibility and provides case management while HUD allocates rental 
subsidies from the Housing Choice Voucher program. In the first year 
the program was authorized, had it been funded, it would have provided 
500 HUD-VASH vouchers and in the subsequent years, an additional 500 
would have been added. This is the only program in HUD that targets 
veterans and at the same time provides supportive services.
    The report titled, ``Ending Homelessness Among Veterans through 
Permanent Supportive Housing,'' by Corporation for Supportive Housing, 
National Coalition for Homeless Veterans and Volunteers of America, 
shows that permanent housing combined with supportive services helps 
prevent and end homelessness among veterans. As more and more troops 
come home from Iraq and Afghanistan, the VA will be facing a major 
crisis. The VA estimates that approximately 400,000 veterans will 
experience homelessness at some point during the year, yet they can 
only provide assistance for a quarter of them. Already veterans from 
Iraq and Afghanistan are showing up in shelters and according to the 
VA, one in five have been diagnosed with a mental disorder. We are 
obligated to these veterans, who have selflessly given of themselves 
for our country to provide them with the tools necessary to acquire a 
dignified standard of living.
    I appreciate your time and I encourage you to consider the 
vulnerable seniors and veterans who desperately need our support 
through these two initiatives when crafting the FY08 budget.

    Mr. Moore of Kansas. Thank you, Ms. Carson, for your 
compelling testimony. And we will take questions at this time 
from members if you have questions. And I am going to turn the 
Chair's duties over to Ms. Sutton and she will be the Chair 
from here. Thank you.
    Ms. Sutton [presiding]. Do any members have questions? Mr. 
Porter?
    Mr. Porter. Thank you, Madam Chair. Actually not a 
questions, just appreciate your being here, Congresswoman. I 
appreciate your comments, and very well said. Thank you very 
much.
    Ms. Carson. Thank you very much for allowing me to be here.
    Ms. Sutton. Are there any other questions for the witness? 
Ms. Carson, if I could just also add my appreciation for you 
coming in and testifying and giving a voice to people who are 
sometimes not heard. Thank you.
    Ms. Carson. Thank you very much. You know, the crime rate 
among homeless veterans skyrockets. A lot of it is attributed 
to the fact that they are homeless, they are hungry, and they 
do not have supportive services. Thank you very much.
    Ms. Sutton. Thank you. The next member to testify is Mr. 
Ehlers. Mr. Ehlers, welcome. We are pleased to receive your 
testimony.
    Mr. Ehlers. Well, congratulations on your new position.
    Ms. Sutton. Thank you, it feels good.
    Mr. Ehlers. That is wonderful.
    Ms. Sutton. You are recognized for ten minutes.
    Mr. Ehlers. Thank you, and I just want to comment, this is 
totally outside my testimony. It is so refreshing to come in 
here and hear discussions of national parks and how to improve 
them, the problems related to them, and then about veterans. It 
is kind of encouraging after all the debating I have heard in 
the last few days about an issue we have very little control 
over. So I just wanted to make that comment. I appreciate the 
work of this Committee.

 STATEMENT OF HON. VERNON EHLERS, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF MICHIGAN

    Mr. Ehlers. I am pleased to testify with Mr. Holt, who I 
believe will probably testify about the same issues I am and 
probably better and more persuasively. I certainly appreciate 
the opportunity to testify as you are considering the new 
Budget Resolution. And in all the many difficult budget choices 
you must make you must not overlook the fact that the 
scientific research and development buttresses our economic and 
national security. And we constantly argue about national 
security issues, but not very often do we recognize how 
important our scientific research and development is because 
that provides the basis for our defense of the future.
    On a bipartisan basis Congress has recognized that 
innovation is critical to our national competitiveness, and it 
took us a good ten years to recognize that after it became 
apparent to folks like Mr. Holt and myself who are in this 
business. But I am pleased that the national has recognized 
this. And I hope as you begin the budget process, I certainly 
strongly urge you to give high priority to scientific research 
and development, as well as math and science education, and the 
general space, science and technology function of the budget, 
Section 250.
    In my testimony today I will briefly highlight three 
important agencies: the National Science Foundation, the 
Department of Energy's Office of Science, and though it is not 
funded under Function 250, the National Institute of Standards 
and Technology.
    The National Science Foundation is the envy of the world. 
It is a fantastic organization. It is the only federal agency 
dedicated solely to supporting basic scientific research. It 
has generated more Nobel Prizes than any other research 
institution in the world. Of all the awards they make for basic 
research, nearly 90 percent of these awards are made through a 
competitive merit review process that ensures that excellent 
and innovative research is being supported. Furthermore, it is 
a very efficient organization and it consistently receives the 
highest rating from OMB for the efficiency and excellence of 
its programs. So, money that you appropriate for the National 
Science Foundation not only is extremely important, but it also 
is used more efficiently than any other government agency does.
    We also have the Department of Energy's Office of Science, 
which is extremely important in a number of areas, important to 
our nation. It is the premier physical science research agency 
of the federal government. In order to maintain our economic, 
technical and military preeminence, we must continue to support 
research in alternative energy sources, nanotechnology, 
supercomputing, and a number of other issues which are under 
the aegis of the Department of Energy's Office of Science. 
Unfortunately, they have been so poorly funded recently that 
they had to lay off people and cut back the time in which we 
allow usage of the major instruments, experimental instruments 
they use.
    The National Institute of Standards and Technology, they 
deal with the nation's standards, and that may seem mundane but 
the back up for that is important. And I do not think any other 
standards institute in the world has received three Nobel 
Prizes within the past decade, but our National Institute of 
Standards and Technology has done that. They also play a major 
role in other things ranging from fire protection, which you 
were just talking about for the National Parks, onto a great 
deal of scientific and technical research. And just a simple 
example of how it affects our daily lives. Everyone, you are 
probably too young to remember the days when color television 
first came out and people were constantly hopping out of their 
chairs to adjust the hue, and the tint, and the color was 
awful. And now we do not have that problem. Interestingly 
enough, the development of accurate time standards in the 
Bureau of Standards made that possible because the frequencies 
that are used to automatically adjust these colors require 
very, very precise standards and the federal government through 
NIST provides those.
    NASA, very important agency, I am very concerned that they 
are not getting enough money for their research programs. They 
are getting money for space, but we must not forget their 
research function. The rovers on Mars have taught us far more 
than we have learned from any manned expeditions in space in 
the recent past.
    I realize that the fate of many of the programs I have 
highlighted in this testimony lies not with you but with the 
Appropriations Committee. While the budget does not spell out 
exactly funding for these programs, I believe that you can send 
a strong signal about the importance of fundamental science and 
education to the Appropriations Committee by making Function 
250 a top priority in the fiscal year 2008 budget. I 
respectfully request that the Committee provide these agencies 
with a budget that reflects the critical role they play in 
maintaining our economic and military strength. I certainly 
hope that you will help us in this effort.
    [The prepared statement of Mr. Ehlers follows:]

   Prepared Statement of Hon. Vernon J. Ehlers, a Representative in 
                  Congress From the State of Michigan

    Thank you, Mr. Chairman, for the opportunity to testify as the 
Committee considers a FY 2008 Budget Resolution. I know the Committee 
must weigh many pressing national priorities, including securing the 
homeland, providing for our aging population, and maintaining a vibrant 
national economy.
    In making these difficult budget choices, we must not overlook the 
fact that scientific research and development buttresses our economic 
and national security. On a bipartisan basis, Congress has recognized 
that innovation is critical to our national competitiveness and that 
scientific research and development is the key to increased innovation, 
economic vitality and national security. As you begin the budget 
process, I strongly urge you to give high priority to scientific 
research and development and math and science education in the General 
Space, Science and Technology function (250) of the budget.
    For the past several years, research and development funding for 
defense, weapons development and national security has increased while 
other areas of federal research and development, especially basic 
research in the physical sciences, has remained flat or declined in 
real terms. Last year's FY 2007 request sought to reverse this trend, 
and House appropriators supported the increases requested by the 
Administration for three important agencies: the National Science 
Foundation, the Department of Energy's Office of Science, and the 
National Institute of Standards and Technology. I am pleased that the 
2008 request of $143 billion for research and development continues the 
doubling path set out at these agencies for targeted research in the 
physical sciences and engineering.

                      NATIONAL SCIENCE FOUNDATION

    The National Science Foundation is the only federal agency 
dedicated solely to supporting basic scientific research. NSF funding 
accounts for one-fifth of all federal support for basic research and 40 
percent of physical science research at academic institutions. Nearly 
90 percent of these awards are made through a competitive, merit-review 
process that ensures that excellent and innovative research is being 
supported. Furthermore, NSF consistently receives the highest rating 
from OMB for the efficiency and excellence of its programs.
    The NSF's FY 2008 budget request of $6.4 billion is a 7 percent 
increase over FY 2006 appropriations, the first year in a ten-year 
commitment to double its budget. This marks a shift from previous 
budget requests, as the NSF budget has been stagnant in recent years, 
and even cut in FY 2005. This significant infusion of research funds is 
extremely necessary for FY 2008 and I ask you to enhance the science 
allocation accordingly. The request is still well below the funding 
level necessary to double NSF funding as authorized in 2002, but I am 
confident that this request is the start of a doubling path that we can 
truly follow.
    While I am heartened by the requested funds for NSF, I am concerned 
about the status of the Education and Human Resources (EHR) budget at 
the Foundation, including the Math and Science Partnership program. 
There is a continuing, but distressing, trend for NSF to move away from 
its K-12 educational mission and to focus solely on graduate education 
and activities to broaden participation in science, technology, 
engineering and math (STEM) fields. For the first time in years the 
Math and Science Partnership program will potentially be able to make 
some new grants this year instead of being eliminated as in recent 
budgets. With more than 50 years of experience, decreasing the role of 
NSF in education seems shortsighted when we are currently facing the 
challenge of adequately preparing our students to enter science and 
technology fields.

                DEPARTMENT OF ENERGY'S OFFICE OF SCIENCE

    The Department of Energy's Office of Science funds 40 percent of 
our nation's physical science research. Research in these areas has led 
to many new economic and medical advancements including, among others, 
new energy sources, the Internet, cell phones and laser surgery. To 
maintain our economic, technical, and military pre-eminence, the 
federal government must continue to support research in alternative 
energy sources, nanotechnology and supercomputing. I respectfully 
request that the Committee provide the Office of Science with a budget 
that reflects the critical role that it plays in maintaining our 
economic and military pre-eminence. To continue on the doubling path, 
the 2008 request for the Office of Science is $4.4 billion. In recent 
years it has endured significant cuts that, in part, led to layoffs and 
the delay of many important instruments. The Office of Science is not 
only important to the future of U.S. science, but also our 
competitiveness and energy security.

             NATIONAL INSTITUTE OF STANDARDS AND TECHNOLOGY

    The National Institute of Standards and Technology is the nation's 
oldest federal laboratory, and the only laboratory with the explicitly-
stated mission to promote U.S. innovation and industrial 
competitiveness. Because it has consistently provided high-quality, 
cutting-edge research into a wide range of scientific and technical 
fields critical to U.S. industry, it has earned a significant role in 
our nation's economic competitiveness.
    The budget request includes $501 million for the core NIST 
laboratory programs and facilities in FY08, a nine percent increase 
over FY06 enacted. This increase includes $59 million for new research 
initiatives and enhancements to NIST's user facilities. I believe it is 
very important to support this request. It represents a significant yet 
sensible investment in programs that give the U.S. a significant head 
start in several fields of emerging technology in quantum physics and 
nanotechnology that will ultimately have great economic impacts. Work 
at NIST's labs also supports our nation's efforts to improve 
cybersecurity, building safety, and voting technology. In addition, 
NIST has a proven track record in research and development on standards 
and measurement techniques that help U.S. manufacturers become more 
globally competitive and retain leadership in cutting-edge 
technologies.
    NIST also manages two programs directed at small manufacturers: the 
Manufacturing Extension Partnership (MEP) program and the Advanced 
Technology Program (ATP). Both of these programs are consistently 
supported by Congress, though they have fallen on hard times in recent 
budget requests. Flat funding for MEP will devastate small and medium-
sized manufacturers and in the long run severely hurt our competitive 
edge in the manufacturing sector. ATP is NIST's only extramural 
research grant program, funding high-risk, high-return technology 
research and development on a cost-shared basis with U.S. industry.
    I have worked very hard over the years to help my colleagues in 
Congress understand that MEP is vital to retaining American 
competitiveness and American jobs, and I believe they appreciate the 
value of this program. I appreciate support in your budget for strong 
programs at NIST.

             NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

    Finally, I would like to address the National Aeronautics and Space 
Administration (NASA) and its share of function 250. In order to align 
the agency with the President's challenge to travel to the moon and 
Mars, NASA has been forced to streamline its mission again this year. 
The proposed missions will be very costly and will pose significant 
technical obstacles that will only be solved through basic research. 
Despite a 3.1 percent requested increase in FY 2008, the rigorous 
flight schedule and impending Shuttle retirement has forced the science 
directorates at NASA to temporarily foot the bill for exploration.
    I understand that the impacts of unanticipated budget constraints 
have been felt across the entire agency, but I remain concerned that we 
will finance the return to the moon and travel to Mars at the cost of 
other critical scientific discovery. Basic science and engineering 
research underpin all of NASA's major accomplishments as well as many 
of the technologies you and I use everyday. Furthermore, basic research 
at NASA will support the future exploration endeavor; if we continue to 
reduce basic research in the out-years, our astronauts will be working 
with outdated technology. I urge you to protect NASA's future by 
supporting its basic research accounts and making the function 250 
budget a significant amount.

                               CONCLUSION

    I realize that the fate of many of the programs I have highlighted 
in this testimony lies not with you, but with the appropriations 
committee. While the budget does not spell out exact funding for these 
programs, I believe that you can send a strong signal about the 
importance of fundamental science and education to the appropriations 
committee by making function 250 a top priority in the FY 2008 budget. 
Behind your lead, I, along with many colleagues who also support 
science funding, will fight for these programs throughout the budget 
and appropriations process.
    Thank you again for allowing me to testify.

    Mr. Ehlers. If it is all right with the Chair, may I just 
ask if Dr. Holt could give his testimony now and then we could 
interact on any questions that might be answered, if that is 
acceptable to you?
    Ms. Sutton. No objection.

STATEMENT OF HON. RUSH HOLT, A REPRESENTATIVE IN CONGRESS FROM 
                    THE STATE OF NEW JERSEY

    Mr. Holt. Madam Chair, I am pleased to join my colleague 
the other half of the bipartisan physics caucus to second his 
remarks and try to underscore the importance of funding 
Function 250 programs.
    Economists will argue about whether the return on 
investment and research is 20, 40 or 60 percent. But whatever 
it is, it is huge. Now, for when a private company invests, MIT 
professor Lester Thoreau says it can expect an average return 
of about 24 percent. However, the economic benefits of a 
private R and D investment are felt by society as a whole and 
often do not return to the company that makes the investment. 
But the return to society on R and D investments is huge. Often 
unpredictable about where it will fall, which is why companies 
tend to spend less on research that will benefit society as a 
whole.
    One role of our government is to do things which benefit 
society as a whole, particularly when market and other forces 
will not do so. And the government has an important role to 
play in the funding of research and history shows that in fact 
federal funding of research stimulates private investment in 
research.
    So I will state it as forcefully as I can. We are 
underinvesting in research in the United States by a very large 
margin. This Committee would do well to increase the funding 
for Function 250 by 50, 75 perhaps 100 percent and not come 
close to saturating the need for investment in research in the 
United States. The return will be huge as you go to balance the 
income and the outgo in the out years, the situation will be 
greatly improved by this investment. And we have, Mr. Ehlers 
and I and others, I am sorry to say, been unsuccessful up until 
now in convincing the predecessor Budget Committees to make 
that kind of investment.
    Now, let me just highlight a few of the specific points 
that Mr. Ehlers already addressed. The President's budget does 
honor the promise for the American Competitiveness Initiative, 
which calls for long term increases in the National Science 
Foundation, the Department of Energy Office of Science, and the 
National Institute of Standards and Technology. They are by 
recent history attractive increases. They fall far short of 
what could and should be done. But the President has been good 
to his promise in those areas.
    But aside from the ACI increases to NSF, DOE and NIST, the 
other areas of the budget target increases for weapons 
development and manned space flight and tend to greatly 
underfund, in fact even cut, research in other agencies. The 
2008 budget request for Function 250, Basic and Applied 
Research, actually falls by 2 percent to $55 billion relative 
to the continuing resolution, and down by 7 percent relative to 
the 2004 peak. Energy R and D falls by 9.2 percent, or more 
than $1 billion in the President's proposal relative to the 
continuing resolution. NOAA R and D falls by about 9 percent. 
The Department of Homeland Security R and D falls by more than 
a percent and a half, I guess. We certainly should not let that 
happen. If the Committee cannot see their way to make the kind 
of bold investment that would benefit the country that I was 
talking about, at least do not let these agencies lose ground 
in research.
    I would also like to underscore the importance of 
maintaining the educational pipeline. Prospective 
undergraduates need better access to the promise of scientific 
and technical college education. Graduate programs must be made 
more appealing by improved quantity and quality of fellowship 
support. Post-doctoral fellowships are a disgrace. It 
constitutes an increasingly long phase of a scientist's career 
that they are not competitive with salaries even made by the 
average college graduate. Now remember, these are post-docs and 
while they require an extreme degree of individual geographic 
flexibility the salaries are not even competitive with students 
right out of college. And with wildly fluctuating federal 
support of competitive grants and funding from some of the 
national labs, even the mid-career and final phase of a 
government or academic scientific career is unstable and much 
less appealing.
    To achieve the best of our national potential, we have got 
to do a far better job in overcoming the social and financial 
barriers for people to enter the sciences. So it is not only in 
elementary and secondary education, but it is in all of these 
federally funded research efforts under Function 250 that we 
have a desperate need to make a strong investment. Otherwise, 
our economic future and society well-being are literally in 
jeopardy.
    [The prepared statement of Mr. Holt follows:]

 Prepared Statement of Hon. Rush D. Holt, a Representative in Congress 
                      From the State of New Jersey

    Thank you Chairman Spratt, Ranking Member Ryan, and distinguished 
Members of the Committee on the Budget. I appreciate the opportunity to 
provide testimony on funding levels for Function 250 programs in the FY 
2008 Budget.
    According to MIT Economics Professor Lester Thurow, when a private 
company invests in research and development, it receives an average 24 
percent return. However, the economic benefits of a private R&D 
investment are felt by society as a whole. The return to society on R&D 
investments averages 66 percent, so two thirds of the reward is felt by 
others besides the company making the research investment. Therefore, 
companies tend to spend less on research than would benefit society as 
a whole.
    It is the business of government to do things which benefit society 
as a whole, particularly when market and other forces will not do so. 
Government therefore has an important role to play in the funding of 
research and development. However, only 30 percent of total American 
R&D is federally funded. With a 66 percent rate of return, 30 percent 
is not enough. In fact, things are even worse than these numbers 
suggest, as private companies have incentives to focus mostly on 
development to the exclusion of research, and even then, mostly on 
short-term development. We must compensate for this by insuring heavy 
investment in the research portion of research and development, 
avoiding the temptation to focus on short-term development rewards. We 
have not done enough to keep the research in research and development 
in the past, and this budget proposal is particularly dangerous in that 
regard.
    Because R&D gives such strong economic returns, we must see it as 
an investment, not an expense, and invest far more in Function 250 
across the board. President Bush's budget request calls for increases 
in several important areas, but in real terms it means the federal 
research investment would fall for the fourth sequential year after 
peaking in 2004.

                          IMPORTANT INCREASES

    President Bush's budget request honors the promise of the American 
Competitiveness Initiative (ACI), which calls for long-term increases 
in the National Science Foundation, the Department of Energy Office of 
Science, and the National Institute of Standards and Technology 
laboratories. Support of these programs has stagnated for far too long, 
and our current ten-year path towards doubling them is essential to 
American quality of life and global competitiveness.

                          MISPLACED PRIORITIES

    In the President's budget, aside from the ACI increases to NSF, 
DOE-Science and NIST, the other areas that the budget targets for 
increases are weapons development and manned space flight. I am 
concerned that massive increases in these development programs are 
coming at the expense of a broad-based, balanced research portfolio.
     Large increases for DOD weapons and NASA spacecraft mean 
an all-time high of $82.8 billion for development, a three percent or 
$2.4 billion increase from last year.
     In NASA, the $12.6 billion, 7.7 percent increase to the 
R&D budget is entirely devoted to the International Space Station and 
the Crew Launch Vehicle and Crew Exploration Vehicle combination.
    Proponents of President Bush's Function 250 request may laud the 
1.4 percent increase in research and development overall from the FY 
2007 Continuing Resolution. However, this number is deceiving. Although 
the dollar amount has increased to $143 billion, the increases are 
concentrated in development for items like weapons systems and manned 
space flight. Although defense and aeronautic development are not 
insignificant priorities, the role of Function 250 is to support a 
broad range of R&D, priorities that lay the groundwork for a globally 
competitive workforce and groundbreaking advances in health, 
telecommunications, energy, applied sciences, and many other areas.

                            CUTS IN RESEARCH

    In President Bush's FY 2008 budget request for Function 250, basic 
and applied research programs actually fall by 2.0 percent to $55.4 
billion relative to the Continuing Resolution, and down by 7.4 percent 
relative to the 2004 peak. The cut in basic and applied research is a 
combination of a rare cut in NIH research along with steep cuts in 
research at DOD (20.3%), NASA, USDA, and other agencies. At NASA, 
despite manned space flight increases, cuts are imposed on research on 
the physical sciences, environment, aeronautics, and other fields. 
Relative to the Continuing Resolution, research at the National 
Institutes of Health declines by $325 million, or 1.1 percent.
    Energy R&D falls by 9.2 percent, or $1.3 billion, in the 
President's proposal relative to the Continuing Resolution. The 
Department of Commerce's National Oceanic and Atmospheric 
Administration (NOAA) R&D budget falls by 9.5 percent. This is shocking 
in the context of an unprecedented level of scientific and political 
consensus on global warming and the importance of sustainable energy 
practices.
    Department of Homeland Security R&D funding falls by 1.5 percent. 
This is similarly surprising in the context of the varied R&D-relevant 
threats which the administration regularly reminds us we face at home. 
This is not limited to protecting American citizens from terrorist 
attacks. We must remember that the charge of the Department of Homeland 
Security includes preparedness and response to natural disasters, as 
well as items like immigration and customs control. The breadth of the 
department and the importance of its charge make R&D pivotal in areas 
under its jurisdiction.

                               EDUCATION

    Nearly fifty years ago, Americans were shocked when the Soviets 
launched the first man-made satellite into space. President Kennedy 
responded by challenging the Congress--and the country--to put the 
first man on the moon by the end of the 1960s. What followed was an 
unprecedented federal investment in education, with a focus on math and 
science, investments in research and development, and the establishment 
of NASA. And just over a decade later, America landed the first man on 
the moon, a feat not yet achieved by the Russians or anyone else.
    Mr. Chairman, the evidence is plentiful that since this ``Sputnik 
moment,'' our commitment to supporting scientific and technological 
research and development has waned. Our economy faces new challenges 
from emerging powers whose students outperform our own, and who produce 
vastly more graduates in the science, technology, engineering, and 
mathematics (STEM) fields. We must do more through Function 250 to 
support the education of prospective undergraduates and graduate 
students who are seeking to enter the STEM fields.
    Prospective undergraduates need better access to the promise of a 
technical college education. Graduate programs must be made more 
appealing by improved quantity and quality of fellowship support. 
Postdoctoral fellowships, which constitute an increasingly long phase 
of a scientist's career, are not competitive with salaries made by the 
average college graduate, while requiring an extreme degree of 
individual geographic flexibility. With wildly fluctuating federal 
support of competitive grants and national labs, even the final phase 
of a government or academic scientific career is unstable and therefore 
much less appealing than we need to be the case. To achieve the best of 
our national potential, we must do a far better job of overcoming 
individuals' social and financial barriers to entry to the sciences, 
and must provide far more stability and reward at every phase in the 
process.

                 R&D LAYS THE GROUNDWORK FOR THE FUTURE

    Better investment in research and development are crucial to our 
safety, sustainability, quality of life, and competitiveness. None of 
these objectives are independent, and virtually all agencies are 
relevant to all these objectives. It is critically important that we 
support R&D more thoroughly and more consistently, and we have the 
opportunity to do that as we review the President's proposal. Congress 
can and must meet the challenge presented by the ill-advised cutbacks 
hiding behind the largely commendable flagship projects of the proposed 
FY 2008 budget.

    Ms. Sutton. I thank the gentleman for his testimony. Do any 
members have any questions? Mr. Berry.
    Mr. Berry. Thank you, Madam Chair. I certainly share with 
you the concern that we are underfunding research and 
development as a nation, and some of this work has to be done 
by the government. It is not going to be done by the private 
sector. And return on investment is obvious. I would pose this 
question to you, to both of you. Do you think this is important 
enough to the future well-being of this country to be willing 
to forego some of the tax cuts that are proposed in the 
President's budget and the extension of some of those tax cuts 
to fund these particular matters?
    Mr. Holt. Well, I will jump in there and say absolutely. 
Individuals, not just society as a whole, individuals will 
benefit sufficiently that most of them will actually come out 
ahead. Historically, when you look back in the days of, and I 
am talking three and four decades ago, of large federal 
investment in research and development, the economy benefitted 
and many individuals benefitted from that.
    Mr. Ehlers. If I may answer that, I cannot say without 
knowing the specific taxes that you might be discussing. But I 
would not averse to that for certain taxes and I would be happy 
to discuss this later as to which ones. The important point, as 
Dr. Holt mentioned, is the investment. And just to give you, 
several years ago I was asked by Newt Gingrich, who was Speaker 
then, to write a new Science Policy document. This government 
had not even written a science policy statement since 1945. And 
so I proceeded to do that. And in the process I tried to find 
out what the actual return on investment was. It is very 
difficult to calculate, and economists are all over the map, 
but I could not find anyone who said it was less than 20 
percent and the highest I found was 4000 percent.
    Now, that was probably something like the laser which I 
think cost the government, I would guess less than $10 million 
in research at the time it was founded. Today it is a multi, 
multi-billion dollar industry in lasers. And the clothes you 
are wearing was cut out by a laser, and medical uses, and many 
other uses of it. And we take it for granted. But it did not 
come out of thin air. It came out of the laboratory of a 
scientist who found a unique way of making it work. And at 
fairly low cost.
    And that is what most scientists do. They are pursuing the 
basic fundamental knowledge of the universe, but almost 
invariably that turns out to be very useful with a huge rate of 
return on the cost of the investment. So this is probably one 
of the few areas that you can rationalize the government going 
into debt because the return on investment is so high. But I am 
sure you are concerned about making sure we pay for it.
    Mr. Holt. But you need not go into debt in order to do 
this. A bold investment is something that would not only be 
socially exciting, it would be the kind of thing we are 
supposed to be doing here in Congress.
    Mr. Berry. It would be the equivalent of building the 
transcontinental railroad in the nineteenth century. You have 
already alluded to the debt, and that was going to be my next 
question. Do you think it is worth putting our children and 
grandchildren in debt for it?
    Mr. Ehlers. I gave that answer already. Not that I advocate 
it, but it is the one thing that you can be pretty certain that 
will not add to their debt. If we spend the investment wisely, 
they in fact will benefit and receive the benefits from it. And 
I say that fearlessly. I am not speculating. This is a 
historical record. And other countries have caught onto this, 
China, India, some of the European countries. If you look at 
the charts, and I did not take any along, but I have spent a 
lot of time on that. If you look on the charts of what 
countries are putting in their investment and how much they are 
spending on this, we used to be at the top. We have now been 
passed by a couple of countries and believe it or not, South 
Korea is very close to passing us up on a per capita or on a 
gross domestic product basis. So they are not sitting still. 
They are racing to catch up or beat us. And we are just 
plodding along with as my companion said very, very slow 
increases. The other countries know what they are doing, and 
they are beating us.
    Ms. Sutton. Mr. Ehlers, Mr. Holt, if I could just ask you a 
question. You make a compelling case about the investment and 
the return. What has been the obstacle to getting Congress to 
move?
    Mr. Holt. Part of the reason is that the typical lobbying 
effort, if I may use that shorthand for the people who bring 
their cases before Congress, is that research has a non-
specific pay back. No interest group can be sure that it 
personally, that they personally, will benefit from this. And 
there are not many people who come and lobby Congress for the 
common good. We are supposed to deduce that on our own, and we 
have not been very good at that when it comes to investment in 
scientific research. I cannot explain better, and I wish I 
could understand, why we have been so blind to this when, as 
Mr. Ehlers says, there is ample historical evidence. The 
economics are difficult to work through but, as I say, and as 
Mr. Ehlers says, it is to try to come up with a distinction 
between whether it is 20 percent, 40 percent, or 60 percent 
return. It is not whether it is 2 or 3 percent return.
    Mr. Ehlers. Let me add a bit, and I can give you two 
reasons why there is a problem. Number one, there are not 
enough nerds in the Congress. There are just two of us, and in 
spite of the fact that we are right it is hard to persuade the 
rest. That is number one. The other is, it is very difficult 
when you are funding research to point out specific 
applications that this might lead to. The laser I mentioned, I 
was in graduate school when the laser was developed. I was 
delighted, I thought, ``Boy, this is great. What a fantastic 
research instrument I will have to make all kinds of new 
discoveries.'' It never once dawned on me that there would be 
this huge commercial market. And in fact, General Electric, 
which was doing research, which could have made millions or 
billions on it, decided they would not do it. Westinghouse 
decided they would not do it. It was the scientist who 
developed it who saw the market, and they went out and they 
made the billions of dollars, not the old, stodgy corporations.
    So, all I can say is just look at the field of medicine for 
an example. We do not expect that physics research is going to 
contribute much to medicine. I mean, what can physics do that 
can help our health? Well, just as an example, x-rays developed 
by physicists. The MRI, developed by physicists. CT Scan, 
developed by physicists. I happen to have not very good ears at 
this point, I am wearing hearing aids. I remember when I was a 
child the hearing aids were boxes like that you carried in your 
breast, the batteries had to be changed everyday. With the 
development of the transistor, which pure physics research, 
they had no idea what would come of it, I now and most of the 
world wears hearing aids which have integrated circuits, that 
digitizes the signal, just like your CD player operates. It 
chops the signal up in different parts, amplifies it to match 
your ears, and they are not cheap but boy it is wonderful. And 
all because someone developed the transistor at one point and 
Texas Instruments developed the integrated circuit.
    Mr. Holt. And for almost all of those inventions that Mr. 
Ehlers spoke about, it is hard to separate the public and the 
private sector contributions to their development. It appears 
to be the case that public investment in research leads the 
private investment in research. And historically, again going 
back to some of the golden era of research thirty and forty 
years ago, the public sector and the private sector were 
approximately equal. The public sector has fallen dramatically 
and we are living economically off of the advances that were 
made decades ago. We are not replenishing those advances at the 
present time.
    Ms. Sutton. Well, I thank you both for your testimony on 
behalf of the greater good. It is eloquent and appreciated. 
Thank you.
    Mr. Holt. Thank you.
    Mr. Ehlers. Thank you.
    Ms. Sutton. The next member to testify is Ms. Boyda. 
Welcome, Ms. Boyda, and we are pleased to have you here to 
testify. You are recognized for ten minutes.

  STATEMENT OF HON. NANCY BOYDA, A REPRESENTATIVE IN CONGRESS 
                    FROM THE STATE OF KANSAS

    Ms. Boyda. Thank you, Madam Chair, and thank you for 
inviting me to testify about the 2008 federal budget, a subject 
that is truly on the hearts and minds of Kansans. The House 
Committee on the Budget has the power and responsibility to set 
Americans' financial priorities. You direct the disbursement of 
nearly $3 trillion, that is $3 million million dollars every 
year. Armed with this enormous wealth we can secure our nation 
and build a more just, free, and sustainable society. Yet, this 
tremendous opportunity is balanced by an equal duty to act 
wisely, not work for political benefit but work for the common 
good.
    As you prepare the 2008 budget, you must consider 
innumerable priorities. All are important, many are critical. 
The budget must expand access to affordable healthcare. It must 
relieve taxes on the independent businesses that are struggling 
to survive. It must revitalize the rural economy through 
targeted developmental farm assistance. It must fund 
alternative fuel resource to free us from the chains of oil 
dependence. And your budget absolutely must fulfill America's 
promise to our veterans and military personnel who have risked 
their lives to secure our peace.
    All of these goals are vital, but I have not yet mentioned 
our nation's highest priority. Today America faces threats from 
a nuclear armed North Korea, from a belligerent Iran, and from 
Al Qaeda terrorists who have already struck such a devastating 
blow against us. In this age of unprecedented dangers, we must 
devote our great nation's resources to improving our military 
readiness.
    I am deeply concerned that our strategic readiness was 
placed at risk by the 109th Congress. Congress had a legal 
obligation to fund out military by passing a 2007 budget before 
October 1, 2006. Not only did they fail to meet this deadline, 
but they left office without ever passing a budget. The 
implications of their failure were far reaching and 
devastating, especially to my congressional district's three 
military bases. Consider the example of Fort Riley, a dominant 
force in the American military that has demonstrated 
outstanding leadership in the War on Terror. Recently, through 
the Base Realignment and Closure Process, Fort Riley won the 
return of the 1st Infantry Division of the United States Army, 
the legendary big red one. Fort Riley and all Kansans were 
heartened by this news and we quickly developed plans for a 
barracks to house the big red one. Funding for this barracks 
should have been included in the 2007 budget, but of course 
Congress never passed a 2007 budget. As I testify before you 
today, the big red one's barracks is five months behind 
schedule and it is unlikely to be completed before their return 
from Iraq.
    Other construction projects at Fort Riley, Fort 
Leavenworth, and America's many other military bases have been 
similarly delayed. Responsibility for this sorry state of 
affairs rests squarely on the shoulders of the 109th Congress. 
The new democratic majority has already begun to recover from 
the last Congress' failures. We passed a continuing resolution 
that increased BRAC funding by $1 billion over the levels 
approved by the 109th Congress, and we are working on a 
supplemental bill to further support BRAC through 2007.
    Now your Committee must continue the critical work. You 
must prepare a budget that fully funds the Base Realignment and 
Closure process for 2008. Please note that I consider this to 
be the most single important issue of our day, both for my 
constituents in Kansas and also for America's security. Once 
your Committee has ensured America's safety I hope you will 
consider many further opportunities to brighten our country's 
future.
    Your ambitions for 2008 should begin with helping millions 
of Americans who now struggle at the bottom of our economic 
ladder. I am heartbroken that in today's America, the richest 
nation in the history of mankind, nearly 47 million of our 
fellow citizens lack health insurance. These hardworking 
families face an uncertain future. An accident, severe illness 
could spell financial ruin. The United States Congress as a 
whole, and this Committee in particular, must seek fiscally 
responsible, market driving solutions that strengthen America's 
systems of employer provided coverage.
    Of course, the employer care system will collapse if our 
employers themselves falter, and so I believe the fiscal year 
2008 budget must strongly support America's businesses, 
especially our independent employers. When small businesses 
flourish our communities and our national economy will 
flourish. Congress is currently considering legislation that 
would ease the burden of taxation on small businesses by over 
$1 billion, and I consider these cuts to be wise and a prudent 
investment in our future.
    In order to further strengthen our economy we must end the 
drain on the wealth in our communities, in our rural 
communities especially. This means supporting our farmers and 
our ranchers whose hard work provides America with the safest 
and the most abundant food supply in the world. Congress has 
long boosted the agriculture industry through rural development 
funds and the 2008 federal budget must continue this 
commitment. By investing in American agriculture this Committee 
can energize the rural economy and open new opportunities to 
hard working farmers and ranchers.
    As you support the industries that have guided America 
through its past, you must also consider our future. One day 
soon, oil and gas and coal will end their centuries long reign 
as the planet's primary source of energy, replaced by fuels now 
under development in laboratories across the world. Our nation 
must prepare for this historic transition, and I urge you to 
pass a 2008 budget that invests in new energy sources such as 
cellulosic ethanol. And I especially encourage Congress to 
invest in wind energy. With your support, my State Kansas, 
which is the third windiest in America, can and will lead the 
world in developing clean, efficient wind-based power.
    Finally, this Committee must fulfill America's promises to 
our veterans. The men and women who served in World War II, 
Korea, Vietnam and Iraq never hesitated when their nation 
called them to duty, and America owes our veterans the same 
unflinching support. Yet lawmakers have consistently cut 
corners on veterans programs, ignoring the promises made when 
our soldiers were on the line of fire. I am the daughter of one 
veteran and the wife of another, so I speak from deep in my 
heart when I say that these failures are unacceptable. Your 
Committee must fully fund the VA. We owe our veterans nothing 
less.
    I have mentioned many goals in my testimony today and I 
could have mentioned a hundred more without scratching the 
surface of the 2008 budget. I realize faced with so many 
complex and sometimes conflicting priorities this Committee 
will have to make compromises. You cannot fund every worthy 
project. Yet by investing our limited resources very wisely, by 
setting aside partisan politics for the public good, I am 
confident that you will strengthen and secure our great nation. 
Thank you for your time.
    [The prepared statement of Mrs. Boyda follows:]

Prepared Statement of Hon. Nancy E. Boyda, a Representative in Congress 
                        From the State of Kansas

    Mr. Chairman, thank you for inviting me to testify about the 2008 
federal budget, a subject that is truly on the hearts and minds of 
Kansans.
    The House Committee on the Budget has the power and responsibility 
to set America's financial priorities. You direct the disbursement of 
nearly $3 trillion--that's three million million dollars--every year. 
Armed with this enormous wealth, you can secure our nation and build a 
more just, free, and sustainable society. Yet this tremendous 
opportunity is balanced by an equal duty to act wisely, to work not for 
political benefit but for the common good.
    As you prepare the 2008 budget, you must consider innumerable 
priorities. All are important; many are critical. The budget must 
expand access to affordable health care. It must relieve taxes on the 
independent businesses that are struggling to survive as America's 
wealth floods overseas. It must revitalize the rural economy through 
targeted development and farm assistance. It must fund alternative fuel 
research to free us from the chains of oil dependence. And your budget 
absolutely must fulfill America's promises to our veterans and military 
personnel, who have risked their lives to secure our peace.
    All of these goals are vital, but I have not yet mentioned our 
nation's highest priority. Today America faces threats from a nuclear-
armed North Korea, from a belligerent Iran, and from the al Qaeda 
terrorists who have already struck such a devastating blow against us. 
In this age of unprecedented dangers, we must devote our great nation's 
resources to improving our military readiness.
    I am deeply concerned that our strategic readiness was placed at 
risk by the 109th Congress. Congress had a legal obligation to fund our 
military by passing a 2007 budget before October 1st, 2006. Not only 
did they fail to meet this deadline, but they left office without ever 
passing a budget.
    The implications of their failure were far-reaching and 
devastating, especially to my Congressional district's three military 
bases. Consider the example of Fort Riley, a dominant force in the 
American military that has demonstrated outstanding leadership in the 
war on terror. Recently, through the Base Realignment and Closure 
process, Fort Riley won the return of the First Infantry Division of 
the United States Army--the legendary ``Big Red One.''
    Fort Riley and all Kansans were heartened by this news, and we 
quickly developed plans for a barracks to house the Big Red One. 
Funding for this barracks should have been included in the 2007 budget 
* * * but of course, Congress never passed a 2007 budget. As I testify 
before you today, the Big Red One's barracks is five months behind 
schedule, and it is unlikely to be completed before their return from 
Iraq. Other construction projects at Fort Riley, Fort Leavenworth, and 
America's many other military bases have been similarly delayed. 
Responsibility for this sorry state of affairs rests squarely on the 
shoulders of the 109th Congress.
    The new Democratic majority has already begun to recover from the 
last Congress's failures. We passed a continuing resolution that 
increased BRAC funding by $1 billion over the levels approved by the 
previous Congress, and we are working on a supplemental bill to further 
support BRAC through 2007. Now your committee must continue our 
critical work. You must prepare a budget that fully funds the Base 
Realignment and Closure process for 2008. Please know that I consider 
this the single most important issue of our day, both for my 
constituents in Kansas and for America's security.
    Once your committee has ensured America's safety, I hope you will 
consider your many further opportunities to brighten our country's 
future. Your ambitions for 2008 should begin with helping the millions 
of Americans who now struggle at the bottom of our economic ladder. I 
am heartbroken that in today's America, the richest nation in the 
history of mankind, nearly 47 million of our fellow citizens lack 
health insurance. These hardworking families face an uncertain future; 
an accident or severe illness could spell financial ruin. The United 
States Congress as a whole, and this committee in particular, must seek 
fiscally responsible, market-driven solutions that strengthen America's 
system of employer-provided coverage.
    Of course, the employer care system will collapse if our employers 
themselves falter, and so I believe the fiscal year 2008 budget must 
strongly support America's businesses--especially our independent 
employers. When small businesses flourish, our communities and our 
national economy will flourish. Congress is currently considering 
legislation that would ease the burden of taxation on small businesses 
by over a billion dollars, and I consider these cuts to be a wise and 
prudent investment in our future.
    In order to further strengthen our economy, we must end the drain 
of wealth from our rural communities. This means supporting our farmers 
and ranchers, whose hard work provides America with the safest, most 
plentiful food supply in the world. Congress has long boosted the 
agricultural industry through rural development funds, and the 2008 
federal budget must continue this commitment. By investing in American 
agriculture, this committee can energize the rural economy and open new 
opportunities to hardworking farmers and ranchers.
    As you support the industries that have guided America through its 
past, you must also consider our future. One day soon, oil and gas and 
coal will end their centuries-long reign as this planet's primary 
sources of energy, replaced by fuels now under development in 
laboratories across the world. Our nation must prepare for this 
historic transition. I urge you to pass a 2008 budget that invests in 
new energy sources, such as cellulosic ethanol, and I especially 
encourage Congress to invest in wind energy. With your support, my 
state of Kansas, which is the third-windiest in America, can and will 
lead the world in developing clean, efficient, wind-based power.
    Finally, this committee must fulfill America's promises to our 
veterans. The men and women who served in World War II, Korea, Vietnam 
and Iraq never hesitated when their nation called them to duty, and 
America owes our veterans the same unflinching support. Yet federal 
lawmakers have consistently cut corners on veterans' programs, ignoring 
the promises made when our soldiers were in the line of fire. I am the 
daughter of one veteran and the wife of another, so I speak from deep 
in my heart when I say that these failures are unacceptable. Your 
committee must fully fund the VA. We owe our veterans nothing less.
    I have mentioned many goals in my testimony today, and I could have 
mentioned a hundred more without scratching the surface of the 2008 
budget. I realize that, faced with so many complex and sometimes 
conflicting priorities, this committee will have to make compromises. 
You cannot fund every worthy project. Yet by investing our limited 
resources very wisely, by setting aside partisan politics for the 
public good, I am confident that you will strengthen and secure our 
great nation.
    Thank you for your time.

    Ms. Sutton. I thank the gentle lady for her testimony. Are 
there any questions? Any members who would like to be 
recognized in thee remaining time? Mr. Porter?
    Mr. Porter. Madam Chair, I am sure that the three of us 
could vote unanimously today, but thank you very much for your 
testimony.
    Ms. Boyda. Thank you so much.
    Ms. Sutton. If there are no questions, thank you very much 
Ms. Boyda.
    Ms. Boyda. All right, thank you. Good luck with your budget 
process.
    Ms. Sutton. Thank you. I am going to turn the Chair over to 
Mr. Baird.
    Mr. Baird [presiding]. The next member to testify is Mr. 
Buchanan. Welcome, and we are prepared to receive your 
testimony. You will be recognized for ten minutes. If you cut 
it a little shorter than that we might have time for questions. 
Thanks, Mr. Buchanan, we will look forward to what you have to 
say.

 STATEMENT OF HON. VERN BUCHANAN, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF FLORIDA

    Mr. Buchanan. Thank you, Mr. Chairman. I thank you for the 
opportunity to testify before you today. I hope to convey my 
thoughts about our current budget, and talk about my 
legislation, H.J. RES. 21, which would add a balanced budget 
amendment to the U.S. Constitution. My bill would balance the 
budget by 2012. It requires a three-fifth vote for any 
increases in debt, that the President submit a balanced budget 
to Congress, and that any legislation to increase revenues must 
be passed by a true majority of each chamber not just a 
majority of those present and voting. Exceptions to these 
provisions are provided in a time of military conflict, or 
natural disasters. I have secured numerous co-sponsors.
    As you know, and especially people on this Committee know, 
the national debt today is $8.6 trillion. Each taxpayer shares 
over $28,000. I know in the last year, year and a half in my 
congressional district many of the constituents are very, very 
concerned about the debt. In fiscal year 2006, $405 billion of 
taxpayer money was spent on interest payments to holders of 
national debt. Last year the interest paid on the national debt 
was the third largest expense in the federal budget. Meanwhile, 
the debt is increasing by over $1 billion every day and yet the 
federal revenues increased 11.8 percent in 2006.
    Forty-nine out of fifty states, including Florida, have a 
balanced budget requirement. Cities, counties in our area all 
have to pay their bills as they go. Florida has continued for 
the last eight or nine years to have one tax cut after another 
but our revenues have continued to grow. It has been the number 
one job growth state in the country. But yet when 9/11 hit and 
we did not have the revenues we made the tough choices. Here in 
this institution you do not have to. In 1994, Contract with 
America had a balanced budget requirement, constitutional 
balanced budget requirement. We did not have quite enough 
votes. The time is now. The last twenty-seven years as I have 
watched politics, and I was a big fan of Ronald Reagan, one of 
the things that a lot of us cannot stand is intolerable as we 
continue to run up these massive debts. There is absolutely no 
confidence that this institution can balance and pay its bills 
as it goes.
    The balanced budget requirement that the President has 
proposed is in alignment with mine in a period of five years. 
We can at that point have a balanced budget requirement. It is 
not a Republican or a Democratic issue. The fact is, I looked 
at the thing and the PAYGO, it just does not go far enough. Our 
children and grandchildren are counting on us to deal with this 
today. The other thing, one thing I read that a politician runs 
from election to election, a statesman runs for the next 
generation.
    Again, I want to thank you for the opportunity to speak 
here today. I look forward to working with you and your 
colleagues on this very important issue. Thank you, Mr. 
Chairman.
    Mr. Baird. I thank the gentleman for his remarks and for 
being brief. If I may ask just a couple of quick questions. 
First of all, I share your commitment to a balanced budget. But 
I have to ask, as a member of this Committee, do you consider 
that the President's plan which asserts that we will have 
balanced budget within five years, but at the same time borrows 
$1.1 trillion from social security including about $180 billion 
or more during the year that we are supposedly in balance, is 
that a balanced budget if we are borrowing $180 billion from 
social security?
    Mr. Buchanan. I do not agree with that, but my feeling is 
is that the thought is that if we are growing our revenues at 8 
or 10 percent a year we do not have to stop spending 
completely. We can maybe add 2 or 3 percent a year. But I think 
we could work together on a bipartisan basis to put something 
in place over five years, get a constitutional balanced budget 
amendment with the exception of war or natural, Katrina or 
something like that. But I think if we do not do it, I am 
convinced, being a student of politics and watching over the 
last twenty-five, thirty years, and this is not about Democrats 
and Republicans this is about doing what is right. If we do not 
do it, the $400 billion we are paying in interest this year 
someday might be $1 trillion for our kids. I am concerned about 
it.
    Mr. Baird. I share the concern. I would just ask, if we are 
going to have a balanced budget amendment, to the Constitution 
no less, it is important to me we be clear on what defines a 
balanced budget. And the President of the United States has 
said he will have the budget in balance and yet clearly he will 
be borrowing $100 billion plus from social security that at 
some point we have to pay back. So definitionally, would your 
amendment to the Constitution address that matter? In other 
words, how would you define a balance? Does the President, 
under your amendment, declare that it is in balance? Or do we 
have on budget versus off budget balance? Or how do we deal 
with that?
    Mr. Buchanan. I think that there are a lot of issues like 
that that we would have to work through. But I think if we did 
it on a bipartisan basis, the Democrats put out a PAYGO, I just 
think we need to take it to the next step. And if we need 
additional revenues and people want to raise taxes, I am 
against that, but if that is where they want to go at least we 
are not borrowing from our kids in the future.
    Mr. Baird. Well, amen to the latter. We are passing 
unconscionable debt onto our kids and I share that concern. But 
I think we also, if we do not, if we are not going to pass that 
debt, David Walker, who is the Comptroller of the Government 
Accountability Office has testified before this Committee, and 
he quite clearly has said that we are going to need a 
combination of spending constraints and revenue increases. He 
does not think we can get there. And when you look at the long 
term budget, particularly the growth of entitlements, I do not 
think we can either. I mean, just mathematically, and I wish I 
could just say one or the other.
    And I will just, I guess for the record in your testimony 
you suggest that since the Bush tax cuts were enacted our 
revenues have grown to record levels. You were not here, this 
is your first year in Congress I know, we had a hearing before 
this very Committee when your party was in charge. And it was a 
good hearing, it was a hearing about whether or not tax cuts 
paid for themselves. Two of the three witnesses were called by 
the then majority party and included Doug Holtz-Eakin, the 
former head of the Congressional Budget Office, I have slipped 
the other gentlemen's names. But all three of those individuals 
were asked, top flight economists, do tax cuts pay for 
themselves? And have the President's cuts lead to a revenue 
increase then the revenue that would have been generated has 
there not been cuts? All of them said no.
    Mr. Buchanan. Well, the only thing I can tell you, take a 
look at Florida's history. We have had substantial cuts year 
after year and our revenues continue to grown. Look at last 
year to this year, we are up 11.8 percent. First quarter of 
last year, fiscal quarter this year we are up 8 percent. Those 
are the numbers. Our budget this year has grown from $2.7 
trillion I guess to $2.9 trillion. Maybe there are numerous 
reasons for that. But I think at the end of the day, we make 
the hard choices. It might be a tax increase. Again, I think we 
can get it done the other way but if we cannot get it done let 
us make the hard choices. Let us pay like every American family 
and business, pay as you go. It is your term. But the only way 
I think this ever gets done, in watching this for thirty years, 
is to have a constitutional budget requirement.
    Mr. Baird. Well, I commend the gentleman for his commitment 
to balance and a bipartisan approach in joining in that. I may 
not join you on the amendment but I think you are absolutely 
right that we are going to have to put everything on that 
table. And the reason we are going to have to is otherwise we 
pass unconscionable debt levels onto our kids. David Walker has 
testified before this Committee that in 2000 the long term 
seventy-five year horizon commitment and current value was $20 
trillion. By 2006 it had grown to $50 trillion, 93 percent of 
the net worth of all American households. You are absolutely 
right, Mr. Buchanan, we have got to work together on this and 
whether we agree or not on the details of the amendment I 
applaud you for your commitment to the issue. I know it is 
sincere, and I am glad you took the time to come before this 
Committee.
    Mr. Buchanan. Well, the only thing I would say is I think 
there is going to be, there would ideally be give and take on 
both sides. But I think at the end of the day we have got to do 
what is right for the next generation.
    Mr. Baird. Amen to that.
    Mr. Buchanan. Thank you, Mr. Chairman.
    Mr. Baird. Thank you. Any other members wishing to have 
questions? Thank you, Mr. Buchanan, I very much appreciate your 
commitment and sincerity in taking the time to be here.
    Mr. Buchanan. Thank you.
    Mr. Baird. The next member to testify is Mr. Larsen, the 
gentleman from Washington. Welcome, Mr. Larsen, my good friend 
and neighbor to the north. We are pleased to receive your 
testimony and you are recognized for ten minutes. And as I 
mentioned before, if you speak for ten minutes I cannot ask you 
any questions so that might be a good strategy as well. But if 
you are shorter than that we can have a little dialogue if 
necessary.
    Mr. Larsen. I am sure we can finish all of this in under 
ten.
    Mr. Baird. Okay.
    Mr. Larsen. And I will give you a minute back.

  STATEMENT OF HON. RICK LARSEN, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF WASHINGTON

    Mr. Larsen. I want to thank the Budget Committee for the 
chance to speak today and I want to focus on one issue in 
particular. And that is the opportunity to speak to you today 
in favor of funding for programs that aid in the fight against 
methamphetamine.
    As you know, methamphetamine is an insidious drug. It is 
literally a chemical cocktail made from hazardous, caustic 
substances and it affects every aspect of our communities. Meth 
labs pollute the environment, endanger children, and wreak 
havoc in our neighborhoods. Meth users steal innocent victims 
identities and will commit any crime in the search of their 
next fix. The toll on our businesses, families, the 
environment, schools, and communities is extreme.
    The fight against meth has thus far been largely a fight 
fought at the state and local level, with assistance from the 
federal government. Our states have done a tremendous job 
reducing the number of home grown meth labs, but while meth 
labs are decreasing meth use is still on the rise fueled by 
cheap, pure crystal meth from countries such as Mexico. It is 
time that we bring the same level of urgency and commitment to 
the federal government's efforts to combat meth as we have seen 
from state and local communities bringing that fight to the 
issue of meth for years.
    Our state and local law enforcement officers, treatment 
providers, and prevention experts have proven effective in 
beating back meth. But they cannot do it alone. There are many 
successful federal programs that can provide them with 
desperately needed resources to do their jobs. Unfortunately, 
many of these programs have taken severe budget cuts in recent 
years.
    One such program is the Edward Byrne Memorial Justice 
Assistance Grant, or the Byrne/JAG Program. This important 
program supports multi-jurisdictional and regional drug task 
forces and aids our local and state law enforcement in busting 
drug trafficking rings. It is the only formula grant program 
available to local law enforcement agencies. Through Byrne/JAG 
state, county, and city law enforcement officers are able to 
work together with federal law enforcement agents to stem the 
flow of meth and save communities from crime. Unfortunately, 
the President has continually proposed to eliminate Byrne/JAG 
Program dollars despite its many successes.
    The President's fiscal year 2008 budget request again 
eliminates the Byrne/JAG Program but keeps the name ``Byrne''as 
part of the new Byrne Public Safety and Protection Program. 
This new Byrne Program consolidates eleven different justice 
programs and underfunds them. These eleven programs were funded 
at almost $800 million individually in fiscal year 2006 but the 
President's request proposes to fund all eleven under this new 
Byrne Program at only $350 million for fiscal year 2008.
    This Committee graciously included $900 million for the 
Byrne/JAG Program in the fiscal year 2007 budget resolution. 
For fiscal year 2008, I would encourage the Committee to not 
only reject the President's new Byrne Public Safety and 
Protection Program, as he proposes to structure it, but also to 
again provide $900 million in budget authority for Byrne/JAG as 
it stands today.
    Another important law enforcement program within DOJ's 
budget is the Community Oriented Policing Services, or COPS, 
Program. The President proposes to cut COPS by over $500 
million in fiscal year 2008. For fiscal year 2007 he asked for 
$117 million for COPS but Congress disregarded that request and 
funded it at $542 million. So I ask the Committee to again 
disregard the President's budget request and to provide full 
funding for COPS in your budget resolution.
    This week I visited the Drug Enforcement Administration's 
training facilities at Quantico and took part in some of the 
training that DEA provides for state and local law enforcement. 
I got a small taste of the dangers faced by the men and women 
on the front lines of the meth epidemic. Our DEA agents do 
great work and the training they provide is useful preparation 
for local law enforcement. Unfortunately, the President's 
fiscal year 2008 request of $1.8 billion is not enough to hire 
new agents, and the DEA faces a hiring freeze for the next two 
years. So I would encourage the Committee to include enough 
money in its budget resolution to fully fund the DEA.
    In conclusion I would just like to mention a handful of 
programs that aid both in the fight against meth and drug abuse 
in general. While law enforcement is important, preventing drug 
abuse in the first place is key. Both the Safe and Drug Free 
Schools and Communities Program and Drug Free Communities 
Program are critical to ensuring safe, healthy, and drug free 
schools. And for those who missed the prevention message and 
choose to abuse alcohol and drugs access to treatment is vital. 
The Substance Abuse Prevention and Treatment Block Grant is the 
backbone of our nation's publicly funded treatment and 
prevention system, and serves our most vulnerable citizens.
    Again, I want to thank the Committee today again for the 
opportunity to testify. And I have additional comments that I 
have submitted for the record, and I am happy to answer any 
questions.
    [The prepared statement of Mr. Larsen follows:]

 Prepared Statement of Hon. Rick Larsen, a Representative in Congress 
                      From the State of Washington

    Thank you, Chairman Spratt. I appreciate the opportunity to speak 
today in favor of funding for programs that aid in the fight against 
methamphetamine.
    As you know, methamphetamine is an insidious drug. It is literally 
a chemical cocktail, made from hazardous, caustic substances, and it 
affects every aspect of our communities. Meth labs pollute the 
environment, endanger children, and wreak havoc on our neighborhoods. 
Meth users steal innocent victims' identities and will commit any crime 
in search of their next fix. The toll on our businesses, families, 
environment, schools, and communities is extreme.
    What started out as a regional west coast drug has quickly 
enveloped the entire country. All you have to do is look at a map to 
see the spread of meth use. In 2005, 49 states reported meth lab 
incidents.
    The fight against methamphetamine has thus far been fought mainly 
at the state and local level, with some assistance from the federal 
government. Our states have done a tremendous job reducing the number 
of homegrown meth labs.
    Thanks to state laws restricting access to meth precursors, and 
also to the Combat Meth Epidemic Act, the number of domestic meth labs 
has significantly decreased in recent years, from over 17,000 labs 
busted in 2003 down to 6,435 in 2006.
    But while meth labs are decreasing, meth use is still on the rise, 
fueled by cheap, pure crystal meth from countries like Mexico. It is 
time that we bring the same level of urgency and commitment to the 
federal government's efforts to combat meth as states and local 
communities have been bringing to the issue for years.
    Our state and local law enforcement officers, treatment providers 
and prevention experts have proven effective in beating back meth. But 
they can't do it alone. There are many successful federal programs that 
provide them with desperately needed resources to do their jobs. 
Unfortunately, many of these programs have taken severe budget cuts in 
recent years.
    One such program is the Edward Byrne Memorial Justice Assistance 
Grant program. This important program supports multi-jurisdictional 
regional drug task forces and aids our local and state law enforcement 
in busting drug trafficking rings. It is the only formula grant program 
available to local law enforcement agencies. Through Byrne-JAG dollars, 
state, county, and city law enforcement are able to work together with 
federal law enforcement agents to stem the flow of meth and save 
communities from crime.
    One success story of Byrne-JAG can be found in my district. In June 
of 2005, the ATF, along with the Northwest Regional Drug Task Force, 
made close to 40 arrests as part of a three-state effort to dismantle a 
drug and gun-selling operation based in Bellingham, Washington. The 
arrests were the culmination of a two-year investigation. Operation 
Roadhouse, as it was called, would not have been possible without 
Byrne-JAG. Those federal dollars allowed the drug task force to do its 
part in busting the bad guys.
    Unfortunately, the President has continuously proposed to eliminate 
the Byrne-JAG program despite success stories like the one in my 
district.
    The President's FY08 Budget request again eliminates the Byrne-JAG 
program but keeps the name ``Byrne'' as part of the new Byrne Public 
Safety and Protection program. This new Byrne program consolidates 
eleven different justice programs and under funds them. These eleven 
programs were funded at almost 800 million dollars individually in 
FY2006, but the President's request proposes to fund all eleven at only 
350 million dollars for FY2008.
    The Committee graciously included 900 million for the Byrne-JAG 
program in your fiscal year 2007 budget resolution. For fiscal year 
2008, I encourage you to reject the President's new Byrne Public Safety 
and Protection program and to again provide 900 million dollars in 
budget authority for Byrne-JAG as it stands today.
    Since FY2002, justice assistance program funding in the Department 
of Justice budget has been cut by more than 63 percent.
    Crime isn't just a local issue and we owe it to our constituents to 
help protect them.
    Another important law enforcement program within DOJ's budget is 
the Community Oriented Policing Services, or COPS, program. The 
President proposes to cut COPS by over 500 million dollars in fiscal 
year 2008. For fiscal year 2007 he asked for 117 million for COPS, but 
Congress disregarded that request and funded it at 542 million. I ask 
the Committee to again disregard the President's budget request and to 
provide full funding for COPS in your budget resolution.
    This week I visited the Drug Enforcement Administration's training 
facilities at Quantico and took part in some of the training DEA 
provides for state and local law enforcement. I got a small taste of 
the dangers faced by the men and women on the front lines of the meth 
epidemic. They confront dangerous criminals, hazardous chemicals and 
life-threatening explosives every time they bust a meth lab. Our DEA 
agents do great work and the training they provide is useful 
preparation for local law enforcement. Unfortunately, the President's 
FY2008 request of 1.8 billion is not enough to hire new agents and the 
DEA faces a hiring freeze for the next two years. I encourage this 
Committee to include enough funding in its budget resolution to fully 
fund the DEA.
    In conclusion, I'd like to mention a handful of programs that aid 
both in the fight against meth and drug abuse in general.
    While law enforcement is important, preventing drug abuse in the 
first place is key. Both the Safe and Drug-Free Schools and Communities 
and the Drug-Free Communities programs are critical to ensuring safe, 
healthy, and drug-free schools. For those who miss the prevention 
message and choose to abuse alcohol and drugs, access to treatment is 
vital. The Substance Abuse Prevention and Treatment Block Grant is the 
backbone of our nation's publicly funded treatment and prevention 
system and serves our most vulnerable citizens.
    I again thank you for the opportunity to address the Committee 
today. I have additional comments that I will submit for the record.
    Thank you and I'm happy to answer any questions.

                  ADDITIONAL TESTIMONY FOR THE RECORD

Impact Aid
    Impact Aid is a critical program for school districts in my 
district and across the country that are adversely impacted by tax-
exempt federally owned land. The Second Congressional District of 
Washington has two Navy bases and eight federally recognized tribes. 
The funding impacted schools in these areas receive through the program 
provides students with the resources they need to learn and teachers 
with the tools they need to teach.
    The President's FY08 budget request would again woefully under fund 
IMPACT AID. Under the President's budget, funding would stay stagnant 
at $1.092 billion, where it has been the last few years. With an 
increased student base, the impact of level funding means that school 
districts across the country that receive IMPACT Aid funding will 
receive less money per student throughout the year. School and school 
districts in impacted areas are squeezed tighter than ever. I urge the 
committee to reject the President's request and increase funding for 
IMPACT AID to a level of $1.35 billion and help us keep our commitment 
to schools and school districts throughout the country. Students in 
these impacted schools should not have to suffer.
    Along with Congressman Mark Kirk of Illinois, I have again 
introduced the ``Government Reservation Accelerated Development for 
Education Act (GRADE-A),'' to ensure the prompt payment and efficient 
delivery of IMPACT AID to our schools. Our legislation would make 
Section 8002 (Federal Property) and Section 8003 (Basic Payments for 
Federally Connected Children) an entitlement and no longer subject to a 
yearly appropriation. Under this legislation, teachers and their 
students would have the secured resources they need to have a 
productive and effective learning environment.
    In the absence of this legislation, I respectfully request the 
Budget Committee to fully fund basic support payments for IMPACT AID at 
a level of $1.35 billion.
Small Business Development Centers
    The President's Fiscal Year 2008 budget is once again a direct 
assault on the Small Business Administration and the many vital 
programs the SBA administers. The President's budget again proposes 
eliminating of a number of key programs and represents a 45% decrease 
in total funding for the SBA since the President first took office in 
2001.
    One critical program proposed to receive level funding for the 7th 
year in a row is the Small Business Administration's Small Business 
Development Center (SBDC) program. The President's FY08 Budget Request 
would keep funding for SBDC's level at $87.12 million which represents 
a cut from FY06 and presumably FY07 funding levels, while costs and 
inflation continue to rise.
    The SBDC program helps small businesses get started and grow, and 
create and save jobs in the process. In Washington state, SBDCs have 
provided management and technical training to more than 27,000 small 
business owners, managers and employees, and provided business 
counseling to more than 19,000 small businesses, since 2001. In the 
process, Washington state SBDCs have helped local businesses create and 
save more than 10,000 jobs, acquire more than $113 million in 
additional funding, and make more than $288 million in sales. Further, 
Washington state SBDCs not only pay for themselves but have a net 
increase for the federal treasury. Washington state SBDC's business 
counseling clients generate $3.84 million in additional federal 
revenues in 2005 (as a result of increased economic activity), which 
well over twice the federal government's investment of approximately 
$1.62 million in Washington state SBDC's in 2004.
    However, federal funding for SBDCs has been in decline since 2004. 
This decline in funding has limited and will continue to limit 
Washington SBDCs' ability to serve local small businesses and create 
new jobs.
    Therefore, I urge the committee to reject the President's proposal 
and include funding for the SBDC program at a level of $110 million. 
This level would still fall below the Fiscal Year 2001 level, while 
adjusting for inflation. Restoring this funding would provide SBDC's 
across the country with the resources they need to help our small 
businesses.

    Mr. Baird. Well, thank you. I want to thank the gentleman 
for his leadership on the Methamphetamine Caucus. You have done 
great work, and someone who has been very active myself in that 
I am grateful for you being here, and calling the Committee's 
attention to this. As you talk to your local law enforcement 
officers and they look at these cuts, what is their reaction 
to, if the federal government under the Bush administration 
were to cut these programs to the levels that are proposed? 
What are the local, guys on the street saying?
    Mr. Larsen. It is usually disbelief, followed by 
frustration. In Snohomish County alone, which is the largest 
county in my district, the Snohomish County Regional Drug Task 
Force would have to shut down within two years if there was 
zero funding through the Byrne/JAG Program. They could get 
through one year by shifting dollars, but the second year would 
require them to just totally shut down thereby obviously 
decreasing the effectiveness and the coordination that is 
important to conduct interdiction against drugs and 
methamphetamine in particular. So, disbelief followed by 
continued frustration to have to fight this battle year after 
year in Congress. It is tough enough to fight the battle 
against drugs and interdiction and, you know, prevention and 
treatment at home at the grassroots. But to have to fight a 
battle out in Washington, D.C. to make sure that there are 
dollars there to help them fight that battle is more work than 
they need to be doing.
    Mr. Baird. One last question. Some would argue that, well, 
we do not need this federal support. Law enforcement is a local 
responsibility. But as my awareness of, particularly the 
methamphetamine problem, is we have a very good job over the 
last number of years locally and with federal help of cutting 
the local clandestine labs and their local domestic supply of 
meth. But increasingly it is international superlabs bringing 
finished product in, which makes it a federal issue in my 
judgment. Are your law enforcement people dealing more, 
especially on the drug front which some of these programs 
address, more increasingly with international suppliers? Or is 
it still the local clan labs?
    Mr. Larsen. It is increasingly an international supply. In 
fact, in the last several years nationally we have seen a 
decrease of meth lab busts from a round number of 12,000 down 
to about 6,000 per year. That is great news. But busting what 
some call these Beavis and Butthead labs, or Mom and Pop labs, 
is one thing, but that supply is being replaced by a higher 
form of methamphetamine that is coming in through international 
distribution channels. That is why in the Combat Meth Epidemic 
Act, which Congress passed last year and you worked on as well 
as many other members in a bipartisan way worked on, there is 
this very important international element for international 
interdiction. We expect within the next couple weeks for the 
State Department to come out with their list of top five 
exporters and importers of ephedrine and pseudoephedrine, the 
precursor chemical for not just great products like Sudafed but 
bad products like methamphetamine, to help develop a baseline 
for further action on international interdiction. So the 
international element is a critical component and the federal 
government is the only dog big enough to fight that battle. I 
cannot rely on my local sheriff, or your local sheriff in 
Cowlitz County, to deal with international drug trafficking. 
That is a federal responsibility.
    Mr. Baird. I think you could not have said it better. It 
was very articulately put and I am glad it is in the record for 
this Committee and I know we will be very cognizant of that as 
we craft the budget. I thank the gentleman. If you have any 
further remarks or anyone else has questions? If not, thanks 
for your testimony.
    Mr. Larsen. Thank you, Mr. Chairman.
    Mr. Baird. And our next witness, I think, is Mr. Wolf. 
Welcome, Mr. Wolf. We are pleased to receive your testimony and 
as I mentioned to our friend Mr. Larsen we have ten minutes, 
and feel free to use it as you so choose.

STATEMENT OF HON. FRANK WOLF, A REPRESENTATIVE IN CONGRESS FROM 
                     THE STATE OF VIRGINIA

    Mr. Wolf. Thank you, Mr. Chairman. The Committee has a 
formidable challenge before it in crafting the nation's budget. 
I do not know, I am not an economist, but as everyone knows 
this nation is facing a financial crisis like none other in our 
history as the baby boom generation starts moving into 
retirement.
    The retirement of the first baby boomer will begin as a 
trickle in less than a year, a few years later the trickle 
becomes a flood, and within five more years a tsunami which 
will wreak havoc on our nation. Our national priorities like 
finding a cure for cancer or fighting meth or keeping America 
competitive in education are already being crowded out by 
mandatory spending in the areas of social security, Medicare, 
and Medicaid. The retirement of the baby boomers will only 
exacerbate an already strained budget.
    We need to take action now in addressing these issues are 
critical to ensure that countries that hold our debt do not 
control our future. Borrowing hundreds of millions of dollars 
from countries like China puts not only our future economy at 
risk but also our national security.
    There is never a convenient time to make hard decisions, 
but the longer we wait the more dramatic the remedy will need 
to be. Abraham Lincoln, one of our nation's greatest 
presidents, said, ``You cannot escape the responsibility 
tomorrow by evading it today.''
    It is encouraging that many members of Congress are 
discussing how to address the issue. I believe the Congress 
understands the crisis we are facing and I believe the 
President does, too. I also believe there is a desire by the 
Democrats and Republicans, as well as the administration, to 
address this crisis. Unfortunately, there may not be the 
political will to make the touch choices to keep the nation 
from falling off a financial precipice. Therefore, I believe we 
need to do something dramatic and something bold that can move 
the nation to understand where the financial future of America 
is headed.
    It is with the hope of building a consensus on this issue 
that Senator Voinovich and I reintroduced the Secure in 
America's Future Economy Commission Legislation, also known as 
the SAFE Commission. I believe the SAFE Commission can provide 
an opportunity to thoughtfully address the nation's budget 
challenges, reflect on national priorities, and move us to take 
responsible actions that will avoid wholesale arbitrary cuts or 
caps. One of the most critical responsibilities of the 
Commission will be explaining the crisis we face and listening 
to the American people about how to get the country back on 
track. To help determine national priorities, the Commission 
would hold series of public hearings across the country to 
engage the American people. I hope and expect that the American 
people would participate and share their thoughts. The key to 
the nation's financial future is a debate that puts everything, 
entitlements and tax policies, on the table. It then would 
require that Congress for an up or down vote on its 
recommendations in their entirety, similar to the BRAC process. 
I believe and fully expect the Commission's legislative 
recommendation to accurately reflect our national priorities, 
but it is important to remember the Commission proposal will 
not become law without a vote on behalf of the Congress, 
including an opportunity for amendments and the President's 
signature. This has the support of the Heritage Foundation, the 
Concord Coalition, former members of Congress including one who 
chaired this Committee, former CBO directors.
    I have heard criticism that such weighty decisions on the 
nation's financial future are the responsibility of Congress. 
That is accurate, but there are two provisions to protect 
congressional prerogative. First, four of the fourteen 
congressionally appointed Commission members must be sitting 
members of Congress. Obviously, the Chairman of this Committee 
and the Ranking Member would almost certainly be two. There 
could be more. Second, if Congress acts significant legislation 
aimed at addressing this looming crisis, the SAFE Commission 
would terminate and cease to exist. But if Congress does not 
act no later than seventeen months from the organization of the 
Commission, it will be required to vote up or down on 
legislative proposals.
    I think with that, Mr. Chairman, I will just sort of end 
it, and just say that, you know, we have a history of your 
mother and father, my mother and father, and parents sacrificed 
for us and I think as a father of five children, as a 
grandfather of twelve, it is time for us to face this very, 
very critical issue. I believe, again, there is a strong 
desire, just listening to members on both sides speak. The 
question is, is there the will?
    [The prepared statement of Mr. Wolf follows:]

Prepared Statement of Hon. Frank R. Wolf, a Representative in Congress 
                       From the State of Virginia

    Chairman Spratt, Ranking Member Ryan, thank you for the opportunity 
to testify today.
    This committee has a formidable challenge before it in crafting the 
nation's budget. While I am not an economist, I do know that this 
nation is facing a financial crisis like none other in our history as 
the baby boom generation starts moving into retirement.
    The retirement of the first baby boomer will begin with a trickle 
in less than one year. A few years later, that trickle will become a 
flood that within five more years will become a tsunami that will begin 
to wreak havoc on federal programs and the economy.
    Our national priorities like finding a cure for cancer or keeping 
America competitive in the world economy are already being crowded out 
by mandatory spending in the areas of Social Security, Medicare and 
Medicaid. The retirement of the baby boomers will only exacerbate an 
already strained budget.
    We need to take action now to ensure that we have the necessary 
resources available for programs such as education, health care and 
transportation, among others, that the American people expect.
    Addressing these issues is also critical to ensure countries that 
hold our debt do not control our future. Borrowing hundreds of billions 
of dollars from countries like China puts not only our future economy 
but also our national security at risk.
    There is never a convenient time to make hard decisions, but the 
longer we wait, the more dramatic the remedy will need to be.
    Abraham Lincoln, one of our nation's greatest presidents, once 
said: ``You cannot escape the responsibility of tomorrow by evading it 
today.''
    It's encouraging that many Members are discussing how to address 
this issue. I believe the Congress understands the crisis we are facing 
and I believe the president understands it. I also believe there is a 
desire by Democrats and Republicans as well as the president to address 
this crisis.
    Unfortunately, I believe neither the Congress nor the president has 
the political will to make the tough choices to keep our nation's from 
falling off the financial precipice.
    Therefore, I believe we need to do something dramatic, something 
bold, that can move our nation to understand where the financial future 
of America is headed.
    It is with the hope of building consensus on this very difficult 
issue that last month Senator Voinovich and I reintroduced the Securing 
America's Future Economy Commission legislation (H.R. 473), also known 
as the SAFE Commission.
    I believe the SAFE Commission can provide an opportunity to 
thoughtfully address the nation's budget challenges, reflect on 
national priorities and move us to take responsible action that will 
avoid wholesale, arbitrary cuts or caps. If we continue to wait and go 
along like the realities of tomorrow will never come, Congress will 
find itself in crisis mode.
    One of the most critical responsibilities of the commission will be 
explaining the crisis we face and listening to the American people 
about how to get the country back on track. To help determine national 
priorities, the SAFE Commission would hold a series of public hearings 
across the country to engage the American people in a national 
conversation about our country's financial future. I hope and expect 
that the American people would participate and share their thoughts on 
how best to respond to the challenges facing our nation.
    The key to our nation's financial future is a debate that that puts 
everything on the table: entitlements, other federal programs, and tax 
policies.
    The SAFE Commission does that and requires Congress to vote up or 
down on its recommendations in their entirety, similar to the BRAC 
process.
    I believe and fully expect the commission's legislative 
recommendations to accurately reflect our nation's priorities, but it 
is important to remember that the commission's proposal will not become 
law without a vote in Congress--including an opportunity for 
amendments--and the president's signature.
    Since we first introduced the idea of the SAFE Commission last 
summer, the proposal has received strong support from across the 
political spectrum. Supporters include: the Heritage Foundation; the 
Concord Coalition; former members of Congress including those who 
chaired this very committee, and former CBO directors.
    It has been embraced by major newspapers across the country, and 
syndicated columnist David Broder.
    I have heard criticism that such weighty decisions on the nation's 
financial future are the responsibility of Congress.
    I couldn't agree more.
    There are two provisions to protect congressional prerogatives.
    First, four of the 14 congressionally appointed commission members 
must be sitting Members of Congress.
    Second, if Congress enacts significant legislation aimed at 
addressing this looming crisis, the SAFE Commission would terminate and 
cease to exist.
    But if Congress doesn't act, no later than 17 months from the 
organization of the commission, it would be required to vote--up or 
down--on legislative proposals.
    I am including for the record a summary of the composition and 
operation of the SAFE Commission to help answer questions you may have.
    As a father of five and grandfather of 12, the challenge posed by 
the pending retirement of baby boomers strikes me as much more than a 
routine policy discussion. Without action, just what kind of future are 
we leaving to our children and grandchildren?
    I also deeply believe there is a moral component to this issue that 
goes to the heart of who we are as Americans. By that I mean, I wonder 
if we have lost the national will to make tough decisions that may 
require sacrifice?
    Moreover, have we lost the political courage to reject the partisan 
and special interest demands and do what is best for our country?
    If we remember the legacy we have inherited--the sacrifices of 
Washington's crossing the Delaware and the battle at Antietam and so 
many other examples from the over two centuries of our nation' 
history--and the debt we owe to previous generations--our grandparents 
and our parents and the sacrifices they made to make our country what 
it is today--I believe we all will be moved to do our duty.
    The SAFE Commission should be embraced by both sides of the aisle. 
This is a national issue; not a Republican issue or a Democratic issue. 
I am open to suggestions about the legislation from members of both 
parties. I believe most Americans will welcome it as well, especially 
considering we all want what is best for our children and 
grandchildren.
    We must heed the cautionary words of George Washington's 1796 
farewell address:
    ``We should avoid ungenerously throwing upon posterity the burden 
of which we ourselves ought to bear.''
    I ask that you take the time to review this legislation and look 
forward to working with you to take the necessary action to secure 
America's future economy.
    Thank you, again, Chairman Spratt and Mr. Ryan, for this chance to 
testify today.

    Mr. Baird. I thank the gentleman first of all for his many 
years of service and his initiative in bringing this up. And I 
think you raise a number of interesting points. I share the 
absolute passion to try to resolve this. And is not, as you 
said very eloquently, it is not a Democratic issue, it is not a 
Republican issue. Our attack ads would probably say, 
``Congressman Wolf wants to cut benefits for retirees,''and 
your attack ads would say, ``Congressman Baird wants to raise 
taxes.'' We are not going to solve the problem with attack ads. 
We are going to solve the problem when we both do the kind of 
things that this Commission would probably recommend.
    If I could ask just a couple questions about the Commission 
itself? As I read it, Mr. Wolf, you are saying that we would 
have to have an up or down vote, but in your testimony I think 
you talked about opportunities for amendments.
    Mr. Wolf. Yes. Each party could have an amendment. The 
House could have its own package, the Senate could have its own 
package, and the administration could have his and it would be 
king of the hill.
    Mr. Baird. Okay. So no amendments to the----
    Mr. Wolf. Correct.
    Mr. Baird. Straight up or down vote on the package itself?
    Mr. Wolf. Correct.
    Mr. Baird. Walk us through the rationale for that, if you 
would.
    Mr. Wolf. We would never have closed a base in this country 
if we did not have the Base Closing Commission. Dick Armey put 
that idea together. There is not the will. And sometimes 
strangely enough in this place, the bigger the issue the easier 
it is to get done. Sometimes an amendment will come out on the 
floor for a $1 million. They will take the whole afternoon 
debating it. Then the next day, perhaps defense appropriations 
come out, and they spend an hour debating the whole bill. So, I 
just do not believe there is, and plus this place, 
unfortunately, is very, very partisan, just what you said at 
the outset. So I think everyone who had that opportunity, I 
think you could certainly, and I changed the bill based on Mr. 
Spratt's comments that there were not enough congressional on 
it. So we did put members on, and he would certainly be on and 
Mr. Ryan would be too, but that number could even go up. But we 
also have Portman from OMB, and we have the Secretary of 
Treasury, and some outside people. They would hold public 
hearings in every federal reserve district. Short of that, I 
just do not think it is going to happen.
    Mr. Baird. Your comment about our kids, you know, I often 
say at town halls, I had a series, as you know, the Concord 
Coalition, and David Walker, the Comptroller of the Currency, 
are doing this fiscal wake up.
    Mr. Wolf. Yes, they support this bill.
    Mr. Baird. Yes, I know. And I had a town hall on that very 
topic two weeks ago and I said any responsible adult between 
themselves experiencing physical pain or illness and suffering 
or passing it on to their kids would immediately say, ``Put the 
pain on me, spare my kids.'' When it comes to fiscal pain, this 
Congress and frankly the constituents and citizens themselves 
are complicit in passing it on to our kids and I applaud you 
for looking for a way to address that. And I call on the 
Ranking Member Mr. Smith to see if he has any questions or 
comments.
    Mr. Smith. I do not yet. I appreciate the opportunity to 
review your testimony and I will probably speak later. Thank 
you.
    Mr. Wolf. Good, thank you. I might say, I am going to look 
for opportunities to offer this in this session. I may offer it 
in full Appropriations Committee, offer it wherever. But I know 
it is somewhat controversial but without this, Mr. Chairman, I 
am not sure we will act. Thank you very, very much.
    Mr. Baird. If I could ask one last question, and this will 
sound like I am trying to be cute and I am seriously not.
    Mr. Wolf. Well, that is okay. No.
    Mr. Baird. I think you are very cognizant of this in the 
structure of the Commission process. It has got to be a super 
majority of, what was it, two-thirds?
    Mr. Wolf. Yes, we were even thinking of, I, whatever Mr. 
Spratt and Mr. Ryan and you all wanted I would change.
    Mr. Baird. Yeah.
    Mr. Wolf. I mean, you all are the boss.
    Mr. Baird. The reason I ask it is because, and again this 
is not meant to be cute, because I have immense respect of the 
administration officials as individuals that you spoke of. And 
frankly, for that matter, for my colleagues on this Committee. 
The question would be, balances of power can change. You could 
have a Democratic president next time. Presumably you would be 
comfortable, partly because of the super majority requirement, 
and I do not read this as you are trying to stack the deck. You 
are trying to get responsible people.
    Mr. Wolf. Yes, it is eight and eight.
    Mr. Baird. Yeah.
    Mr. Wolf. So it is eight and eight, and hopefully we would 
pass this before the next president. So, no, this is eight 
Republicans and eight Democrats. It is exactly split, eight and 
eight.
    Mr. Baird. Is that coincidental to the majority make up of 
the House right now?
    Mr. Wolf. No, it is where we are based on we have a 
Republican administration and we have a Democratic Congress.
    Mr. Baird. Yes, my question Mr. Wolfe would be if we had 
next round a large switch in the other direction, one way or 
the other so that it was Democratic administration, Democratic 
Congress or Republican administration, Republican Congress, 
does the balance get skewed at that point?
    Mr. Wolf. Well, I really had not thought about that. That 
is a good question. I am hopeful, well I am really not hopeful 
that it is going to pass. I am going to try that it would be 
done in this Congress. And I think we are at a, we are at a 
point, and there is a sincere, I read everything Mr. Spratt 
puts out. I will stipulate, he is very sincere about this.
    Mr. Baird. He actually is.
    Mr. Wolf. And when you listen to Mr. Conrad over in the 
Senate side I believe he is, too. Our members are, too. So I 
think we are at a point now, where we have a Republican 
administration, a Democratic House and Senate in Congress, you 
almost have a stalemate, each can check point. And by having a 
super majority, we require it not only be Democrats for it but 
some Democrats and Republicans. Or, not only just Republicans 
but some Democrats. So it can truly be bipartisan.
    Mr. Baird. I appreciate it. I know you to be sincerely and 
passionately committed to this, and that is why I wanted to, I 
was not trying to get you on the record.
    Mr. Wolf. That is okay.
    Mr. Baird. I was trying to give you a chance to be on the 
record as manifesting that, is what was the goal of that. 
Because I know that what you are trying to do is come up with a 
Commission that can get the job done without one side or the 
other having so much power over the other side. That is not 
something we can agree with. Because in the end, then, we would 
not vote it right.
    Mr. Wolf. That is right. And everything, again, I heard you 
talking, everything, everything has to be on the table.
    Mr. Baird. Amen to that. I thank the gentleman very much 
for his service and contribution.
    Mr. Wolf. Thank you, Mr. Chairman.
    Mr. Baird. The next member is the gentle lady from the 
Virgin Islands, Ms. Christensen. Welcome, and we are pleased to 
receive your testimony. You are recognized for ten minutes. 
Thank you for being here.
    Dr. Christensen. Thank you, Mr. Chairman.
    Mr. Baird. Pardon me, I should have said Dr. Christensen.
    Dr. Christensen. Thank you. I will make reference to that, 
and in order to shorten my presentation it is a little 
different from what you have in the complete testimony.

STATEMENT OF HON. DONNA M. CHRISTENSEN, A DELEGATE IN CONGRESS 
                  FROM THE U.S. VIRGIN ISLANDS

    Dr. Christensen. I want to thank you, Chairman, and members 
of the Committee for the opportunity to give testimony into 
what I know will be a very difficult budget process. And I come 
to you today wearing many congressional hats. First, as the 
Delegate from one of the offshore possessions of the United 
States and as Chair of the Subcommittee on Insular Affairs. As 
such, I would be remiss if I did not point out that the 
economic conditions of the U.S. Territories under the 
jurisdiction of the Department of Interior have languished over 
the past ten years. Each of them, the Virgin Islands, Guam, 
America Samoa, and the Commonwealth of the Northern Marianas, 
continue to suffer from high unemployment and unstable 
economies.
    While our well being is depending on programs and every 
department of our government being applied in the most 
appropriate way to our islands, in large measure it does fall 
to the Technical Assistance Account of the Office of Insular 
Affairs as the only program which provides assistance 
specifically to the U.S. Territories to meet and tailor the 
programs to our needs or respond to some of the unique 
challenges that we face. At a time when the economic trend in 
all of these U.S. Territories is downward, that one account, 
which can be useful to help improve our condition, should not 
also be decreased as it is in the President's budget. 
Accordingly, I believe more resources should be devoted to the 
Office of Insular Affairs Technical Assistance Account to 
better respond to the needs of our territories. And to further 
support our economies I would also encourage the Committee to 
work with the Virgin Islands and Puerto Rico to provide for the 
full cover over of excise taxes that are due to the 
territories.
    But, Madam Chairwoman and colleagues, I also come to this 
Committee as the only female physician ever to have served and 
the only physician of color in this body. Also, as Chair of the 
Health Braintrust of the Congressional Black Caucus and as one 
of the three Health Co-Chairs of the Tri-Caucus, which is made 
up of the Congressional Black, Hispanic, and Asian-Pacific 
Caucuses. In that capacity we represent nearly one-third of the 
U.S. population, which is growing. Unfortunately this is also 
the segment of our population that makes up more than one-half 
of the uninsured, that has the least access to quality care, 
and that therefore bears the greatest burden of disease in this 
country. These circumstances have created longstanding and 
shameful disparities in health between our populations and the 
rest of the country and this results in close to 100,000 
premature, preventable deaths every year.
    The time has come for ethnic and racial minority Americans 
and for our entire country to make that up front investment in 
the healthcare of people of color to end these disparities; to 
bring fairness, justice and equal opportunity to our national 
healthcare system; and to prevent the healthcare crisis that 
now exists from becoming a catastrophe.
    But we have to be willing to set the new direction and to 
provide the bold leadership we promised this country last year 
which, though doubtful, they elected us to provide. I have to 
say up front, and I know this is going to be a bit of heresy to 
many people, that it will take either ending the tax cuts for 
the wealthiest among us and cutting the excess fat out of a 
defense budget that pays for billions in waste, or it will take 
increasing our debt or slowing our achievement of a surplus. 
But it is an investment that we cannot afford not to make. Our 
country's strength, continuing moral leadership, and national 
security depend on it. Even if it increases debt, the 
economists define good debt and bad debt. What we are asking 
will not be the bad debt that has left the middle class as well 
as the poor and people of color waiting and left behind while 
the big corporations and wealthy Americans have gotten more at 
their expense and the expense of our country. It would be good 
debt, which through investing in our people improves well being 
and preparedness and so increases productivity, and the 
strength, competitiveness and prosperity of our nation.
    We have all asked to lead and now it is up to us to do so. 
And doing so will require a change in the healthcare and health 
spending paradigm we have followed for far too long in this 
country. Whether we get additional funding, as I am requesting, 
or not, it is critical that we redirect how we spend the 
limited healthcare dollars we will have. We can no longer 
continue to increase funding just to NIH at the expense of 
prevention and quality healthcare. We cannot just fund health 
centers without ensuring their survival through adequate 
reimbursement through full funding of public health programs 
and increased training of a diverse health workforce to take 
care of our increasingly diverse population. Our failure to do 
this is at the heart of our failure to close the disparity gap 
and reach our health people goals.
    The adage an ounce of prevention is worth a pound of cure 
has not survived this long without good reason. It was true 
when first uttered, it is true today, and it applies to how we 
can most effectively spend our healthcare dollars which are 
considerable. Without a doubt, the $2 trillion we now spending 
annually has not raised our health status ranking in the world; 
has not enabled the poor, the rural or those Americans of color 
to be healthier; nor has it prepared us to protect our 
communities from the threat of terrorism by biologic, chemical, 
or even nuclear agents. To spend the dollars we do budget more 
effectively and to reduce and eventually reverse the 
skyrocketing cost of healthcare, we have to set a new 
direction, to change course, to alter the old tried and failed 
approach and instead focus on expanding coverage, increasing 
access, improving quality, providing cultural and linguistic 
competence in healthcare, and improving the social determinants 
of health in poor, rural and communities of color.
    I have listed a number of programs in my submitted 
testimony which are important to this goal, programs which have 
been cut, eliminated or level funded and which need to be at 
least restored and at best increased which is what we urge you 
to do. Medicare, Medicaid, and SCHIP for the states and the 
territories and the rebuilding of a better, stronger healthcare 
in New Orleans and the rest of the Gulf region affected by 
Katrina and Rita are among the top priorities because they are 
the foundation upon which the new direction of healthcare must 
be started. But there are also the programs that give our 
children a healthy start in life. Many of these and more are 
listed in the testimony: those that target aid dollars to the 
hardest hit communities, especially the African American 
community; that provide increased access and equity to mental 
health and substance abuse treatments; that fund programs to 
American Indians living in urban areas; that empower 
communities to develop systems that better meet their 
healthcare needs and support wellness; those that reach out and 
bring under represented minorities into the health professions 
at all levels; or that keep the facilities and institutions 
that serve the under served open; that reimburse providers for 
the largely high quality healthcare they provide despite being 
nickeled and dimed to death; or those programs that improve the 
social and economic factors that underpin our health and that 
above all focus on health promotion and disease prevention, 
which is the key to reducing our nation's health costs and to 
reliably and sustainably reducing the deficit.
    In none of the projections I have seen has there been any 
reference to the impact of healthcare cost to the debt, if 
those healthcare costs continue their rapid, uphill spiral 
unchecked. To rein in these costs the options are only two. 
One, to provide the quality and comprehensive care, to reduce 
or prevent catastrophic, high cost disease, and create healthy, 
productive citizens and communities. Or, to use a class 
containment strategy that creates a multi-tiered system of 
healthcare delivery and simply leaves the poor and very often 
the middle income to fend for themselves, which bluntly put is 
to write them off. The second is not only abhorrent to our 
democracy and the ideals of this country, it is not an option.
    Finally, Madam Chairwoman and colleagues, and this is where 
I am asking you to step up and out even further beyond our 
comfort zone and the political limitations we have placed on 
the 2008 budget and on ourselves. For this nation's health to 
improve, for the cost of healthcare to begin to go down, for us 
to once again be the most productive and competitive nation we 
have always been, we must do what is necessary to ensure equal 
opportunity for all and that includes equal opportunity for 
healthcare and to good health. To do that we must first 
eliminate health disparities. And so in addition to repairing a 
budget that is in need of intensive care I am asking for a 
Health Equity Fund to be created at the level of somewhere 
around $2.5 billion over the next five years, with the 
possibility of renewal.
    The disparities, which are sometimes called the slave 
health deficit because of its origins, have been with us for 
400 years. It would be reasonable to expect that it would take 
more than five years to close it. While I and many of our 
partners and supporters would have no problem if we were to 
incur good debt for this noble purpose, it is also possible to 
find an offset for this fund which is so vital for our future 
in other areas of the Health, Budget, or other sections of our 
national budget. Our bottom line is we cannot afford to do it, 
Madam Chair and other colleagues. Advances in technology and 
the over $6,000 per capita we spend in this country on health, 
at least one person of color whose death should not have 
happened, whose death was premature and preventable, died in 
the time it took me to make this presentation. It adds up to 
over 200 people per day, and close to 100,000 people annually. 
Not just because they failed to act responsively, in most cases 
they try, but because the institutions that serve them and 
create the programs and the policies that direct that work 
themselves fail to act responsively.
    This is the kind of terrorism that African Americans, other 
people of color, and the poor live with every day. The 
President's budget is woefully out of sync with the American 
public as are his policies and priorities. Americans want equal 
opportunity to good healthcare and to good health for all. They 
want an America that lives up to its promise, a promise that 
includes investing in the most precious resource we have, our 
people. The Democratic party, and all of us who have come here, 
have always stood for those same things. This would be a bold 
step. But bold leadership is also what we promised and I want 
us to deliver on that promise.
    [The prepared statement of Mrs. Christensen follows:]

 Prepared Statement of Hon. Donna Christensen, a Delegate in Congress 
                      From the U.S. Virgin Islands

    Thank you, Chairman Spratt and members of the committee for the 
opportunity to give testimony and input into what I know will be a very 
difficult budget process.
    I come before you today, not only as a fellow colleague, but as the 
only female physician ever to have served in this body, as the only 
physician of color in this body, as Chair of the Health Braintrust of 
the Congressional Black Caucus and as one of the three health co-chairs 
of the Tri Caucus--made up of the Congressional Black, Hispanic and 
Asian Pacific Caucuses.
    In that capacity, we represent nearly one third of the US 
population and are growing. Unfortunately, this is also the segment of 
our population that makes up more than one half of the uninsured; that 
has the least access to quality care; and that therefore bears the 
greatest burden of disease in this country.
    We refer to the health gap between this population and other 
Americans as Health Disparities. They are great, they cause about 
100,000 premature preventable deaths each year, and they lower the 
quality of care and drive up the costs for everyone.
    And so while what I am about to request may seem irresponsible on 
its face, given our growing indebtedness, I submit to you that it is an 
investment that must be made to improve the overall health and strength 
of our nation.
    And Mr. Chairman and Colleagues, this investment can come from but 
a small portion of savings realized from rescinding or not renewing the 
tax cuts for the wealthiest category of individuals. Or it can cause a 
small but productive increase in our debt. But it would be worth it in 
terms of the returns for the health and health care savings of all 
Americans.
    As you know better than I, economists make the distinction between 
bad debt and good debt, and agree that ``good'' debt is investment debt 
that creates or improves value and ``bad'' debt accomplishes the very 
opposite. Mr. Chairman, my request is one that falls under the ``good'' 
debt category because it would be increasing value that is evident not 
only in the health and well being of individuals and communities, but 
also in the strength of the workforce, our defense and ultimately our 
nation.
    To be effective, it would be critical that we adopt a new approach 
to healthcare funding that goes beyond our current focus of research at 
the expense of prevention and care, and community health centers, which 
while they have the potential to be the cornerstone of healthcare, 
cannot do so without adequate reimbursements, well funded public health 
programs and staff that reflects and is sensitive to our diversifying 
communities.
    So to not just eliminate disparities, but to slow down and begin 
the reversal of the skyrocketing health care costs, beginning with this 
new budget which sets a new direction for our country, we must change 
our focus and expand coverage, increase access, improve quality, as 
well as cultural and linguistic competence, and change the social 
determinants of health in communities of color.
    To begin with, we have to restore cuts and fill in gaps in the 
president's budget.
    As the Congresswoman from the United States Virgin Islands, who 
practiced medicine there for more than two decades before coming to 
Congress, I am very concerned that under the President's budget, the 
Virgin Islands and other U.S. territories will continue to NOT receive 
state-like treatment under Medicaid and Medicare, despite having state-
size health and health care needs and challenges. Compounding and 
further exacerbating this problem is the inability of territorial 
governments to afford to fully meet the health care needs of their 
citizens, whose incomes are less than double the U.S. poverty level. 
The time has come for us to invest in the health and life opportunities 
of ALL Americans, from Maryland to California, from Alaska to the U.S. 
Virgin Islands and from Oregon to Guam.
    Mr. Chairman and Colleagues, we owe it to all citizens to address 
this problem, that is why my fellow territorial Delegates and I have 
each year introduced legislation to lift the federal Medicaid Cap and 
provide it with a match equal to that of the poorest state. We were 
fortunate in the last Congress to receive an increase in Medicaid funds 
for the first time since the balance Budget act of 1997. It is my hope 
that this the first budget put forth by Democrats in over twelve will 
at the very least begin the process of addressing this need.
    Additionally, as the Chair of the Subcommittee on Insular Affairs, 
I would be remiss if I didn't point out that the economic conditions in 
the U.S. territories, under the jurisdiction of the Department of 
Interior, have not improved over the past ten years. Each of them, the 
Virgin Islands, Guam, American Samoa, and the Commonwealth of the 
Northern Mariana Islands continue to suffer from high unemployment and 
unstable economies. In large measure, the Technical Assistance account 
of the Office of Insular Affairs is the only program which can be used 
to respond to the circumstances in these U.S. territories.
    At a time when the economic trend in all these U.S. territories is 
downward, the one account which can be useful to help improve their 
condition should not follow. Accordingly, I believe that more resources 
should be devoted to the Office of Insular Affairs Technical Assistance 
account to better respond to the needs of our U.S. territories.
    Mr. Chairman and Colleagues, as someone who remembers the images of 
the aftermath of Hurricane Katrina, I am disheartened that the 
President's budget fails to include any funding for rebuilding the 
healthcare infrastructure in the Gulf Coast. Mr. Chairman, thanks to 
24-hour news coverage, the nation; no, the world saw, heard stories of 
and saw images of the negative impact that social determinants of 
health have on our most vulnerable and marginalized communities.
    Enough time has passed from August 29, 2005--the day that Hurricane 
Katrina slammed into the Gulf Coast--and now for us to have seen a 
redesigning and rebuilding of the healthcare infrastructure in the Gulf 
Coast.
    It has been well-documented that three states bore the brunt of the 
hurricane's impact--Louisiana, Mississippi and Alabama. And, not only 
did these states have some of the highest poverty rates in the nation 
before the hurricane hit, but also had noted health disparities that 
left a disproportionate number of African Americans, other people of 
color and the poor un- and under-insured, in poorer health, suffering 
worse health outcomes and more likely to die prematurely, and often 
during their most productive life years, from preventable causes.
    While some steps have been taken, myriad challenges in redesigning 
and rebuilding the healthcare infrastructure in the Gulf Coast continue 
to exist, and without adequate funding, these challenges will not fix 
themselves; they will not solve themselves; they will not disappear; 
and the Americans most affected by the storm will never be made whole.
    Mr. Chairman and Colleagues, as the Chair of the Congressional 
Black Caucus Health Braintrust, I am especially struck by the fact that 
the President's budget literally eliminates or cuts--and at best, 
level-funds--every single health and health care program that is 
critically important to our nation's most vulnerable and marginalized 
residents' health, well being and life opportunities. And, a 
disproportionate number of the residents who stand to lose the most are 
not only African Americans, other Americans of color and rural 
Americans; they are the very who stand to lose the absolute very most 
to pay for a war that no one supports and for extensive tax breaks for 
the nations few super-billionaires. Mr. Chairman and Colleagues, that 
is not the America that I know, champion or support!
    The list of programs on the fiscal chopping block reads like an 
honor roll--or, perhaps I should call it a DIS-honor roll, because it 
lists programs that are essential and necessary, and thus should not be 
level funded, cut or eliminated.
    When the President introduced his FY 08 budget, I--like so many of 
my colleagues--was struck by one disappointing, yet indisputable fact: 
the President's health and health care priorities are not in sync with 
those of most residents of this nation. Mr. Chairman, they are not only 
NOT in sync with Americas' priorities; they completely contradict them!
    Rather than address the root causes of uninsurance, poor health 
outcomes and escalating health care costs, the President's budget 
instead shifts the burden onto individuals, health care providers and 
states.
    I'll start with some of the programs that are slated for level 
funding:
     The president's budget freezes funding for Minority AIDS 
Initiative, even though the HIV/AIDS epidemic often hits racial and 
ethnic minority communities in a manner that rivals the trends in sub-
Saharan Africa;
     The Substance Abuse Block Grant, the Child Mental Health 
Block Grant, and the Protection and Advocacy grant program in the 
Substance Abuse and Mental Health Services Administration also are flat 
funded;
     The budget level funds the Indian Health Service Diabetes 
grants; and
     The budget level funds Health Resource and Service 
Administration's Sickle Cell grants;
    The following programs slated for elimination need to be restored 
and increased:
     The Health Care Facilities/Other Improvement Projects 
grants;
     The Community Health State planning grants;
     The Healthy Community Healthcare Access Program;
     The Health Professions Training Activities;
     The Emergency Medical Services for Children program;
     The Universal Newborn Hearing/Trauma Screening, an effort
    that in FY2006 was allocated $10 million by Congress;
     Indian Health Service Urban Health grants;
     The Commodity Supplemental Food Program, which--funded at 
$107 million in FY 02007--provides food packages designed to address 
specific nutrient deficiencies for about 500,000 low-income elderly 
persons, women, and children each month; and
     The food stamp program, which disproportionately affects 
11 states--South Carolina, Delaware , Maine , Maryland , Massachusetts 
, Michigan , North Dakota, Oregon, Texas, Washington , and Wisconsin--
that operate simplified food stamp programs.
    And, at the very least, the cuts to these programs that follow need 
to be restored and increased to meet the increased demands after years 
of cuts and neglect:
     The budget cuts funding to the Substance Abuse and Mental 
Health Services Administration (SAMHSA) by $159 million dollars and 
cuts drug treatment programs by $47 million dollars. The services 
offered under SAMHSA are critically important to Americans with serious 
mental health issues and to those who need substance abuse prevention 
and treatment services;
     The budget slashes Health Resource and Service 
Administration's Rural Health programs by $143 million dollars;
     The budget cuts the Administration for Children and 
Families by $1.868 billion dollars;
     The budget cuts Medicare spending by $252 billion over ten 
years ($65.6 billion over five years);
     The Budget fails to provide sufficient funding for the 
State Children's Health Insurance Program (SCHIP). In fact, the funding 
level in the President's budget is woefully less than the amount needed 
to maintain benefits for those now receiving SCHIP and for those 
millions of uninsured children who are eligible for SCHIP, but who have 
not been enrolled;
     The budget cuts Medicaid by $28 Billion over five years. 
Medicaid is critically important to millions of Americans, not only 
because it keeps them from joining the ranks of the uninsured, but 
because it allows beneficiaries with very real, very urgent health 
needs to have access to care that literally sustains their lives;
     The budget cuts the Health Resource and Service 
Administration's National Health Service Corps by $10 million dollars. 
This program is critically important to closing the gap between high 
health care needs and a dearth of health care providers;
     The budget cuts the Health Resources and Services 
Administration's Nurse Training Program by $44 million dollars and cuts 
the Advanced Education Nursing Program by $57 million dollars. These 
cuts are problematic because the nation's shortage is very real. In 
fact, the Bureau of Labor Statistics estimates that by 2014, the 
national health care system will need 1.2 million registered nurses to 
replaced retired nurses, accommodate aging baby boomers, and growing 
patient needs;
     The budget slashes the Indian Health Service Health 
Facilities construction grants from $38 million dollars to $13 million, 
the Indian Health Service Health Facilities sanitation construction 
grants from $92 million dollars to $89 million, and the Indian Health 
Service Health Facilities construction grants from $38 million dollars 
to $13 million. Historically, we--as a nation--have done far too little 
to ensure the health and well being of our American Indian residents, 
and these cuts do not put us on the right path;
     The Budget cuts the Healthy Start infant mortality 
initiative--an initiative which boasts results in reducing racial and 
ethnic disparities in infant mortality--by $1 million. That may not 
seem like a lot of money, but to this program, that cut will be 
catastrophic!;
     The President's budget cuts funding for the Office of 
Minority Health by $3 million, the Office of Women's Health by $1 
million, and the National Center for Minority Health and Health 
Disparities at National Institutes of Health by $1 million dollars.
    Finally, Mr. Chairman and Colleagues, the forgoing requests are 
important and while restoring them will have an impact on the 
eliminations of health care disparities, they do not go far enough to 
close the huge chasm in this country between the poor and the rich; the 
rural and urban and the suburban; and the white American and those of 
color. And so I further propose a ``health equity fund'' of at least 
$2.5 Billion over 5 years to fund the expansion of proven models of 
prevention and care that demonstrate clear efficacy in closing health 
gaps. This investment could come from new or existing monies in all 
related programs across several agencies and offices in way that has a 
specific focus and mandate. And, it could be placed in any number of 
agencies, such as the Bureau of Primary Care or the 0ffice of Minority 
Health, as long as the purpose and use of the fund is clearly 
delineated, monitored and reported on.
    Mr. Chairman and colleagues, this country--the richest and most 
powerful in the world--ranks below most industrialized countries in 
maternal and infant mortality. We are ranked 39th by the World Health 
Organization in health status. And yet we spend at least twice as much 
as any other country in the world on health care; just about $2 
trillion in 2005 and roughly 16% of GDP. And that expenditure is 
increasing.
    Clearly we are doing something wrong and continuing the same course 
will only give us the same result. And the continuing ill health and 
consequent overuse of expensive care will only undermine what can be 
the world's best healthcare system for everyone. That is unacceptable.
    Mr. Chairman and Colleagues, in this country of great wealth, more 
than 200 people of color will die prematurely from preventable causes, 
who ought not to have died, by the end of the day today. And, that 
trend will continue until we do what is necessary to stop it.
    Many would blame the people themselves, and definitely each of us 
has a responsibility for our individual health. But just think of the 
very responsible person who has no way to pay for care; who is 
discriminated against by the system and many of its providers; or who 
live in circumstances such as substandard housing or polluted 
communities, or neighborhoods where common medication and other health 
care services are unavailable, or for whom the closest provider is 
someone they cannot understand or does not understand them. This is the 
circumstance that far too many Americans find themselves in and which I 
am asking you to change.
    I know that if we meet them half way, they would do their part. So, 
I am here before you arguing, as I will continue to do, for a new 
investment and a new direction in health budgeting and spending.
    We ran on a new direction platform. We won because that is what the 
American people want and need.
    The president's budget is woefully out of sync with the American 
public, as are his policies and priorities. They want equal opportunity 
for good health care and good health for all. They want an America that 
lives up to its promise; a promise that includes investing in its most 
precious resource: our people.
    This would be a bold step, but bold leadership is also what we 
promised. I want us to deliver on that promise.

    Ms. Hooley [presiding]. Thank you for your testimony and 
for really pointing out all of the inequities that we have in 
our healthcare system, the amount of money that we spend and 
yet we do not really have a healthcare system. I appreciate 
your testimony and this will be put in the record and certainly 
passed on to our Chair of this Committee. So, thank you very 
much.
    Dr. Christensen. Could I just read a quote that comes from 
Dr. Stephen Wolf at Virginia Commonwealth University? It is 
very short.
    Ms. Hooley. Okay.
    Dr. Christensen. From some studies that he has done, and it 
sums it up, ``In the end, however, it all comes down to 
priorities.'' And this is the quote, ``In the end, however, it 
all comes down to priorities. Perhaps we have reached the point 
when progress in providing good care when needed with 
compassion and skill and without errors would impress the 
public as a more meaningful medical advance than the roll out 
of the latest device or pill. Failing to establish systems to 
ensure that everyone receives recommended care is causing 
greater disease and deaths at levels that can rarely be offset 
by medical advances.'' I thank you for allowing me to include 
that quote.
    Ms. Hooley. Thank you. We have Representative Higgins next, 
and then right after him I believe it is Representative Hayes. 
Welcome, and we are pleased to receive your testimony. You are 
recognized for ten minutes.

 STATEMENT OF HON. BRIAN HIGGINS, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF NEW YORK

    Mr. Higgins. Thank you, Madam Chair and distinguished 
members of the Committee. I am here to ask the Committee for 
consideration of two priorities that I would like to see 
reflected in fiscal year 2008 budget resolution. One is the 
federal courthouse proposed for the City of Buffalo. The 
judiciary has identified this project as a top project, top 
priority in the nation. Although this project has not received 
funding over the last couple of years, in the proposed 2008 
budget the President has included as the only funded courthouse 
$46.7 million. The continuing resolution that the House passed 
a couple of weeks ago included $280 million to the government 
service agency specific to new courthouse construction. I 
believe that GSA will provide $83.5 million of that $280 
million. The $46.7 million in the President's proposed budget 
for 2008 would completely fund that project.
    While it is a courthouse project, generally speaking, to 
Buffalo it is an economic development project. The GSA has 
already started to clear the site. It has relocated businesses. 
The property is currently off the tax roles. So it is a very, 
very important project and I respectfully ask for the 
Committee's consideration for keeping that $46.7 million for 
the Buffalo courthouse in the 2008 budget.
    The second issue is something very different, but something 
I think very important to the nation and that is funding to the 
National Cancer Institute. Madam Chair, over the past five 
years this administration has cut approximately $250 million to 
the National Cancer Institute and the National Institutes of 
Health. This funding is vitally important for cancer research 
and prevention.
    We have made great strides as a nation in treating and 
effectively dealing with the issue of cancer. Thirty years ago 
if you were diagnosed with cancer fewer than 50 percent lived 
beyond five years of their diagnosis. Today, it is 65 percent 
for adults, 85 percent for kids. More people are living with 
cancer today than are dying from it. But we still face 
extraordinary challenges. Men have a one in two likelihood of 
developing invasive cancer in their lifetime, women a one in 
three likelihood. Cancer research is very, very important at 
the research level because it sustains funding for clinical 
trials which if successful will provide treatments for 
tomorrow's cancer therapies. But it also undermines the start 
of new cancer research.
    So I would respectfully ask the Committee to restore the 
cut, again, that the administration has made to the National 
Cancer Institute and the National Institute of Health, that 
being $11.4 million.
    [The prepared statement of Mr. Higgins follows:]

Prepared Statement of Hon. Brian Higgins, a Representative in Congress 
                       From the State of New York

    I thank the Committee for this opportunity to testify today on some 
of the priorities I would like to see reflected in the Fiscal Year 2008 
Budget Resolution.
    Briefly, I would like to state my support for a number of programs 
that are important to Western New York including LIHEAP, the 
Weatherization Assistance Program, COPS, and the Clean Water State 
Revolving Loan Fund. I urge the Committee to reject dangerous cuts to 
these effective programs as proposed in the President's budget.
    I would like to focus my remarks today on two issues of particular 
interest to me. The first is the construction of a new federal 
courthouse in Buffalo, New York. The Buffalo Courthouse is the top 
project on the Judicial Conference's priority list, and was the only 
federal courthouse construction project requested in the FY 2008 budget 
request. The Administration has requested $46.7 million for this 
project which, coupled with funds we made available for courthouse 
construction in the FY 2007 Continuing Resolution, will enable the 
General Services Administration (GSA) to undertake this critical 
construction project in Buffalo's downtown core.
    The existing Michael Dillon U.S. Courthouse is no longer adequate 
and has major security concerns. The judges' chambers are directly 
across the street from a parking garage with a clear view into the 
chambers, making them vulnerable to attack. Prisoners are unloaded on 
the street and are brought to courtrooms by the same elevators used by 
the public, judges and court personnel. These elevators are antiquated 
and accidents have happened when they failed to align properly with the 
floors. Several of the courtrooms had to be fashioned from office space 
and are therefore undersized, with view-obstructing columns. It is time 
that the court has a facility that will function efficiently and 
provide the necessary security for all who use and work in the 
courthouse.
    GSA received $14.2 million for acquisition of land and design of 
the Buffalo Courthouse from 2000 through 2002. It has acquired property 
on Niagara Square, an important commercial area in downtown Buffalo. 
The design has won award and acclaim, and demolition will commence this 
year. But unless Congress provides the funding necessary to allow 
construction to proceed, the net impact of the federal government's 
actions on this project will be to displace small businesses from the 
site, to remove this real estate from the local tax rolls, and to leave 
a vacant lot on an important piece of real estate in a vital section of 
our struggling downtown core.
    These are economic and tax impacts which our region, with a 
struggling economy and local governments mired in fiscal straits, can 
not and should not be made to bear. Buffalo simply can not afford to 
delay this opportunity to turn a vacant lot into a tower of jobs that 
will complement the nascent investment and revitalization we are 
experiencing in other parts of the city.
    Because the Judicial Conference has ranked the Buffalo Courthouse 
as its top construction priority nationwide, and because allowing this 
federally-acquired land to remain fallow would be destructive to our 
community, I strongly encourage the Budget Committee to include the 
$46.7 million that will allow GSA to complete this important project.
    The second issue I would like to focus on is one of national 
concern. You are in a unique position to put us on the path towards 
meeting the National Cancer Institute's (NCI) goal of eliminating death 
and suffering due to cancer by the year 2015. Recent statistics have 
shown declining cancer deaths in the United States for the second year. 
This drop is largely due to increased awareness, better treatment, and 
larger numbers of people being screened; but these advances are also 
due to the past investments that Congress made to the National Cancer 
Institute and the National Health Institutes (NIH) in general. 
Unfortunately, we are at serious risk of losing the momentum towards 
meeting the 2015 as research dollars are cut and cannot keep pace with 
medical inflation.
    The 110th Congress should lead the way with the objective of 
eradicating cancer death and suffering in this decade by restoring deep 
cuts to federal cancer research and prevention programs. The 
President's $2.7 trillion budget for 2007 reduced funding for virtually 
every cancer research and prevention program totaling $40 million this 
year, $70 million last year and $250 million over the past five years. 
His proposed budget for 2008 includes more cuts to cancer funding, down 
to $4.782 billion, or an $11.4 million cut below the 2007 Continuing 
Resolution. In 1998 25% of research applications to NCI were being 
funded, now only 10% are being funded and many researchers are being 
forced to cut clinical trials because they cannot afford the expense. 
These cuts will further slow existing research and delay the start of 
promising new research. In my district alone, these cuts represent $5 
to 6 million in losses to the Roswell Park Cancer Institute, an NCI 
designated center and one of the leading research institutes in the 
country.
    Less than 10 percent of cancer deaths today are caused by the 
primary tumor. It is when cancer metastasizes that it becomes deadly. 
Early detection saves lives and money, an estimated $300 billion last 
year alone in health care costs and lost productivity. Cancer 
researchers are making impressive progress toward unraveling cancer's 
dark mysteries and using this knowledge to prevent cancer from becoming 
life threatening. Today's research will produce tomorrow's treatments 
and cures. Thirty years ago, fewer than 50 percent of those with cancer 
lived five years beyond their diagnosis date. The survival rate today 
is 65 percent for adults and 80 percent for children. In America more 
people are living with cancer than dying from it. Today we have 10 
million cancer survivors; tomorrow we could have more.
    Despite this impressive progress, big challenges remain. Men today 
have a 1 in 2 likelihood of developing invasive cancer in their 
lifetime; women have a 1 in 3 chance. Last year more than 1 million new 
cancer cases were diagnosed and 500,000 people died from cancer. 
Funding cancer research not only saves lives and money, but it expands 
economic growth. Roswell, in my district, pioneered studies that gave 
us chemotherapy, the prostate specific antigen (PSA) test and research 
linking smoking and lung cancer. With more than 2,700 employees, 
Roswell Park is a major employer and contributor to the regional 
economy, drawing patients and researchers to Buffalo from throughout 
the world.
    NCI and the American Cancer Society set an ambitious goal of 
eliminating all human suffering and death from cancer by the year 2015. 
We can do more than simply supporting a resolution towards this goal; 
we can give the medical community the tools it needs to achieve it. 
This should be a fully funded national imperative; you have the power 
to make it America's goal.
    Thank you for allowing me to testify before you today. I know you 
face many competing demands as you craft the budget, but I hope you 
will look favorably on these two essential issues.

    Ms. Hooley. Thank you for your testimony. Any questions? 
Again, thank you very much for coming.
    Mr. Higgins. Thank you very much.
    Ms. Hooley. The next member to testify is Representative 
Hayes.
    Mr. Hayes. Thank you, Madam Chair. I remember that last 
time that you and I and Mr. Higgins were together. I'm sure 
this will be an equally pleasant experience.
    Ms. Hooley. Welcome, and we are pleased to have your 
testimony, and you are recognized for ten minutes.

  STATEMENT OF HON. ROBIN HAYES, A REPRESENTATIVE IN CONGRESS 
                FROM THE STATE OF NORTH CAROLINA

    Mr. Hayes. Thank you. Madam Chair, thank you for allowing 
me the opportunity to testify before the Committee today. 
Several topics I would like to highlight: funding for veterans 
healthcare, Impact Aid, vocational and technical job training 
programs, and Department of Agriculture programs.
    Madam Chair, the service of our country's veterans ensures 
that all Americans can live in freedom. They answered the call 
without question and that is why it is so vitally important 
that we honor their service by making certain that they receive 
the quality healthcare they have more than earned. The 
President's request in the 2008 budget proposal for Veterans 
Affairs totals $86.75 billion, including $44.9 in mandatory 
funding to support benefit programs for our nation's veterans 
and $36 billion for medical care.
    Though levels of healthcare funding continue to grow, as we 
continue the Global War Against Terrorists so do the number of 
veterans increase. With exponential healthcare cost increases 
it is important that we provide the maximum possible level of 
funding for their care. As you and your Committee begin 
assembling the budget resolution for 2008 I ask that you fund 
programs for our nation's veterans. I would also ask that you 
include necessary funding for PTSD and mental health, traumatic 
brain injury, and blast related injuries in order to fulfill 
the growing needs in those areas within VA.
    In my district in North Caroline I fought for a new 
Community Based Outpatient Clinic, CBOC, so that local veterans 
would have improved VA healthcare access. I am very pleased 
that the Department of Veterans Affairs in the process of 
establishing a CBOC in the eighth district, and I look forward 
to working with them and my fellow members of Congress on 
providing the necessary funding for VA healthcare facilities 
across the country.
    I would also ask that you consider reducing the funding for 
foreign operations. We have so many needs here at home, sending 
American tax dollars to fund programs in other countries and 
international organizations should not be a top priority. We 
must take care of our own first before sending aid overseas.
    Another critical area of concern is that of military 
construction funding. The continuing resolution drastically 
reduced funding for essential construction projects, global 
rebasing and implementation of the Base Realignment and Closure 
process. This has a negative effect on both our military 
readiness and our nation's servicemembers. In my home district 
at Fort Bragg alone, up to $220 million in construction 
projects have been put in jeopardy. These projects include 
everything from barracks to training ranges to child 
development centers. I urge you to do all that you can to fund 
military construction at the highest possible level to help 
lessen the blow to our bases, safety and quality of life for 
our men and women in uniform, and our national security.
    Madam Chair, another issue important to our military 
families is Impact Aid. Funded in both the Department of 
Defense and Education, this critical program acts as Uncle 
Sam's tax payment on land owned by the federal government. 
These funds are vital to sustaining local school districts that 
derive little or not property tax revenue because they are 
situated on federal or Indian land. The importance of the 
Impact Aid Program is illustrated by my own district in North 
Carolina which is typical of many places around the country 
with military bases as the largest employers and land owners. 
The eighth district is home to Fort Bragg and Pope Air Force 
Base. The counties of Cumberland and Hoke are affiliated with 
these local military installations. The President's 2008 budget 
calls for a third consecutive year of a freeze in funding. I am 
increasingly concerned about how BRAC and global rebasing is 
affecting our local schools.
    Currently over one million federally connected children 
with a potential increase of 35,000 to 40,000 in 1400 public 
school districts and Congress must step up to meet the needs of 
these children and our schools. We cannot leave our school 
districts lacking funding and facilities to support these 
children. With this in mind, I urge my colleagues to include at 
least $50 million in Department of Defense funding for Impact 
Aid and to send a clear message to our military families. We 
are going to take care of their children whether they are 
educated at overseas posts or here stateside.
    Madam Chair, we must do more this year to recognize this 
burden on our local school districts and increase funding for 
Impact Aid. As Co-Chair of the 116-member House Impact Aid 
Coalition I want to work with you to provide a modest increase 
in Department of Education funding to cover the federal 
government's obligation to these school districts.
    Madam Chair, community colleges in my district are 
concerned about funding for vocational and technical education 
such as Perkins Loan and Community Based Job Training Programs. 
Workforce training programs are vital in my district for 
teaching workers who have experienced job losses in the textile 
and manufacturing industries, teaching them the skills they 
will need to succeed in the high growth and high demand 
industries of the twenty-first century. I feel that by 
eliminating these programs we may leave behind students and 
programs that provide hands on workforce education in the 
growing trades of our economy.
    I am very concerned that the administration's 2008 budget 
proposal for the Forest Service once again includes an 
initiative for the sale of certain National Forest System lands 
to provide funding for an extension of the Secure Rural Schools 
Act. The proposal calls for the sale of more than 270,000 acres 
of forest lands nationwide and 5600-plus acres in North 
Carolina. Uwharrie National Forest is one of Montgomery 
County's largest attractions and is a vital component for 
economic development in the region. Towns and communities 
located in this area depend on tourism from those visiting 
these pristine forest lands. This initiative could threaten a 
critical source of economic revenue for my constituents, 
therefore I strongly oppose this proposal and hope you will 
share my concerns.
    As you know, eighth district farmers continue to express to 
me their strong concern over proposals seeking to decrease the 
agriculture budget in Congress. The budget reductions in 
agriculture continue to bring a disproportionate burden of 
deficit reduction on America's farmers and rural communities. 
Appropriations bills have increasingly reduced mandatory 
funding for conservation, rural development research, and 
renewable energy. For 2006 the reduction was $1.7 billion. In 
addition, the budget reconciliation bill passed last year is 
projected to reduce the Agriculture Committee's spending during 
2006 to fiscal year 2010 reconciliation period, four years, by 
$3.7 billion. CBO also released their agriculture baseline. It 
is clear that the amount of money for agriculture is shrinking.
    Since the 2002 Farm Bill expires in September of this year, 
we are under even more pressure to ensure that we have the 
necessary resources to develop a new Farm Bill which will bring 
certainty to producers who make their planning decisions and 
business plans based upon these agricultural programs. However, 
it is imperative that we do this without removing important 
safety nets that truly protect farmers from low prices and poor 
yields.
    In regard to the administration's Farm Bill proposal, I 
appreciate the aggressive position they took in many areas such 
as renewable energy and conservation programs. Focus on ethanol 
produced from these biomass sources will allow our farmers to 
play a vital role to help increase our nation's energy 
independence from foreign sources of energy. As for 
conservation, my producers are very supportive of incentive 
based conservation initiatives such as EQIP and CRP. These 
important programs have been a major success in rehabilitating 
wildlife and improving the environment. I have some concerns 
with the administration's proposal to significantly reduce the 
adjusted gross income eligibility cap. This could be very 
damaging to many farmers in the eighth district. I look forward 
to working with the administration to learn the details of 
these proposals in the near future. I also look forward to 
working with my colleagues on the upcoming Farm Bill and I am 
hopeful that you will continue to support agriculture programs 
that are important to eighth district farmers.
    Madam Chair, thank you for the opportunity to testify 
before your Committee about these important programs. I 
appreciate your consideration, look forward to working with you 
on the fiscal year 2008 budget, and I thank you my friend.
    [The prepared statement of Mr. Hayes follows:]

 Prepared Statement of Hon. Robin Hayes, a Representative in Congress 
                    From the State of North Carolina

    Mr. Chairman, thank you for allowing me the opportunity to testify 
before the Committee today. There are several topics I would like to 
highlight: funding for Veteran's health care, Impact Aid, vocational 
and technical job training programs, and Department of Agriculture 
programs.
    Mr. Chairman, the service of our country's veterans ensures that 
all Americans can live in freedom. They answered the call without 
question and that is why it is so vitally important that we honor their 
service by making certain that they receive the quality health care 
they have more than earned.
    The President's requested FY 2008 budget proposal for the 
Department of Veterans' Affairs totals $86.75 billion, including $44.97 
billion in mandatory funding to support benefits programs for our 
nation's veterans and $36.6 billion for Medical Care. Though the level 
of health care funding continues to grow, as we continue the Global War 
on Terror so do the number of veterans. With exponential health care 
cost increases, it is important that we provide the maximum possible of 
level of funding for their care. As you and your committee begin 
assembling the budget resolution for Fiscal Year 2008, I ask that you 
fund programs for our nation's veterans. I also ask that you include 
necessary funding for Post Traumatic Stress Disorder (PTSD) and mental 
health, Traumatic Brain Injury, and blast related injuries in order to 
fulfill the growing needs in those areas within the VA.
    In my District in North Carolina, I fought for a new Community 
Based Outpatient Clinic (CBOC) so that local veterans would have 
improved VA health care access. I am very pleased that the Department 
of Veterans' Affairs is in the process of establishing a CBOC in the 
8th District of North Carolina and look forward to working with them, 
and my fellow Members of Congress, on providing the necessary funding 
for VA health care facilities across the country.
    I also ask that you consider reducing the funding for foreign 
operations. When we have so many needs here at home, sending American 
tax payer dollars to fund programs in other countries and international 
organizations should not be a top priority--we must ``take care of our 
own first'' before sending aid overseas.
    Another critical area of concern is that of Military Construction 
funding. The Continuing Resolution drastically reduced funding for 
essential construction projects, global rebasing, and implementation of 
the Base Realignment and Closure process and this has a negative impact 
on both our military readiness and our nation's service members. In my 
home district at Fort Bragg alone, up to $220 million in construction 
projects have been put in jeopardy. These projects include everything 
from barracks to a training range to a child development center. I urge 
you to do all that you can to fund Military Construction at the highest 
possible level to help lesson the blow to our bases, the safety and 
Quality of Life of our men and women in uniform, and our national 
security.
    Mr. Chairman, another issue important to our military families is 
Impact Aid. Funded in both the Departments of Defense and Education, 
this critical program acts as Uncle Sam's tax payment on land owned by 
the federal government. These funds are vital to sustaining local 
school districts that derive little or no property tax revenue because 
they are situated on federal or Indian land.
    The importance of the Impact Aid program is illustrated by my own 
District in North Carolina, which is typical of many places across the 
country with military bases as the largest employers and land owners. 
The 8th District is home to Fort Bragg and Pope Air Force Base, and the 
counties of Cumberland and Hoke that are affiliated with these local 
military installations.
    The President's FY'08 budget calls for a third consecutive year of 
a freeze in funding. I am increasingly concerned about how BRAC and 
global rebasing is affecting our local schools. Currently, there are 
over 1 million federally connected children with a potential increase 
of 35,000 to 40,000 in 1400 affected public school districts, and 
Congress must step up to meet the needs of these children and our 
schools. We cannot leave our school districts lacking funding and 
facilities to support these children. With this in mind, I urge my 
colleagues to include at least 50 million in Department of Defense 
funding for Impact Aid and to send a clear message to our military 
families--we are going to take care of their children whether they are 
educated at overseas posts or here stateside.
    Mr. Chairman, we must do more this year to recognize this burden on 
our local school districts and increase funding for Impact Aid. As Co-
Chair of the 116 member House Impact Aid Coalition, I want to work with 
you, Mr. Chairman, to provide a modest increase in Department of 
Education funding to cover the federal government's obligation to these 
school districts.
    Mr. Chairman, Community Colleges in my District are concerned about 
funding for vocational and technical education such as Perkins loans 
and community-based job training programs. These workforce training 
programs are vital to my District for teaching workers who have 
experienced job losses in the textile and manufacturing industries the 
skills they will need to succeed in the high growth and high demand 
industries of the 21st Century. I fear that by eliminating these 
programs, we may leave behind students and programs that provide hands 
on workforce education in the growing trades of our economy.
    I am very concerned that the Administration's FY 2008 budget 
proposal for the Forest Service once again includes an initiative to 
sale certain National Forest System Lands to provide funding for an 
extension of the Secure Rural Schools Act. This proposal calls for the 
sale of more than 270,000 acres of forest land nationwide, including 
5,685 acres in North Carolina.
    The Uwharrie National Forest is one of Montgomery County's largest 
attractions, and is a vital component for economic development in the 
region. The towns and communities located in this area depend on 
tourism from those visiting these pristine forest lands. This 
initiative could threaten that critical source of economic revenue for 
my constituents; therefore I strongly oppose this proposal and hope you 
share my concerns.
    As you know, 8th District farmers continue to express to me their 
strong concern over proposals seeking to decrease the agriculture 
budget in Congress. Budget reductions in agriculture continue to bring 
a disproportionate burden of deficit reduction on America's farmers and 
rural communities. Appropriations bills have increasingly reduced 
mandatory funding for conservation, rural development, research and 
renewable energy. For FY 06, the reduction was $1.7 billion. In 
addition, the budget reconciliation bill passed last year is projected 
by CBO to reduce agriculture committee spending during the FY 06 to FY 
10 reconciliation period by $3.7 billion. CBO also released their 
agriculture baseline and it is clear, the amount of funding for 
agriculture is shrinking.
    Since the 2002 Farm Bill expires in September of this year, we are 
under even more pressure to ensure that we have the necessary resources 
to develop a new farm bill, which will bring certainty to producers who 
make their planting decisions and business plans based upon these 
agriculture programs. However, it is imperative that we do this without 
removing important safety nets that truly protect farmers from low 
prices and poor yields.
    In regards to the Administration's Farm Bill proposal, I appreciate 
the aggressive position they took in many areas, such as renewable 
energy and conservation programs. The focus on ethanol produced from 
new biomass sources will allow our farmers to play a vital role to help 
increase our nation's energy independence from foreign sources of 
energy. As for conservation, my producers are very supportive of 
incentive based conservation initiatives, such as EQIP and CRP. These 
important programs have been a major success in rehabilitating wildlife 
and improving the environment.
    However, I have some concerns with the Administration's proposal to 
significantly reduce the adjusted gross income eligibility cap. This 
provision could be very damaging to many farmers in the 8th District. I 
look forward to working with the Administration to learn the details of 
these proposals in the near future. I also look forward to working with 
my colleagues on the upcoming Farm Bill, and I am hopeful that you will 
continue to support agriculture programs that are important to 8th 
District farmers.
    Mr. Chairman, thank you for the opportunity to testify before your 
Committee about these important programs. I appreciate your 
consideration and look forward to working with you on the Fiscal Year 
2008 budget.

    Ms. Hooley. Thank you, any questions? Yes, Representative 
Blumenauer?
    Mr. Blumenauer. Thank you, Madam Chair. I appreciate 
Congressman Hayes, your point about, even though Congresswoman 
Hooley and I deeply care about the extension of the rural 
schools funding that it not come at the expense of selling off 
our precious natural resources, and I appreciate your reference 
to that and I certainly agree.
    I have two questions about your testimony in terms of 
understanding. You reference concerns about the adjusted gross 
income eligibility cap that the President has come forward 
with. My understanding is that is $200,000?
    Mr. Hayes. Correct.
    Mr. Blumenauer. And a requirement that it actually be 
$200,000, that it could not be multiple members of a family so 
that it is 200, 200, 200.
    Mr. Hayes. Right.
    Mr. Blumenauer. Or spouse and kids. You say, what level do 
you think it should be at?
    Mr. Hayes. Oh, I wish I knew. It is a very good question. 
In checking the figures over two million folks who have 
adjusted gross incomes of over $200,000 so it is not an 
insignificant number of folks. Of the 85,000 who filed Form F 
Farm Request, 25,000 actually received payment. So it is a 
larger number. I do not know what the number should be. My 
concern is going from $2.5 million down to $200,000 is a huge 
jump and I have asked the Secretary just to take a look, as you 
have asked me, to make sure that we are not missing something 
in our attempt to solve what may or may not be a problem.
    Mr. Blumenauer. You reference your concern about reducing 
funding for foreign operations. I guess that is the 150 
accounts? Do you have a sense of what programs you want reduced 
or deleted? Health? Water? Military? Where do you think the 
cuts should be made?
    Mr. Hayes. That is a tough one. Just in general, folks at 
home think foreign aid is not nearly as important as water, 
food programs, schools, and other issues that are domestically 
important to them. I sort of share, I would be happy to look up 
and give you some specific recommendations. That is a tough 
question to answer. Basically, it is the difference between 
domestic and foreign and that is what the folks back home care 
about.
    Mr. Blumenauer. Well, I would be interesting to hear it.
    Mr. Hayes. I would be happy to.
    Mr. Blumenauer. And your reaction. It is true, people say 
that. Of course, you are also aware of the public opinion polls 
that people think we spend ten times as much as what we do.
    Mr. Hayes. Oh, absolutely.
    Mr. Blumenauer. And we are having testimony here about the 
fact that the United States does less with foreign aid than any 
of the other major countries. We made a commitment, as you 
know, to do .7 percent of our GDP. We are down to .25 percent 
and we are not keeping our commitments on things like water. 
And some of the things that you are talking about, they use 
money to buy things from us. Some of our agriculture is used 
overseas, actually posing problems for poor people overseas.
    Mr. Hayes. Sure.
    Mr. Blumenauer. Because we get food and we are not buying 
it from the local areas. So this is an area of great interest 
to me and one that is going to be of contention on the 
Committee. Because things like international water and 
sanitation saves lives and protects the health of Americans and 
we are going to be, I think, struggling with this in a way that 
we could use guidance in terms of the specifics. In terms of 
areas that you think are worthy of cuts so that if we come 
forward with something that it would actually be supported.
    Mr. Hayes. I appreciate the depth and nature of your 
question, and I will be happy to come back to you with some 
more specifics. I suspect that a lot of these countries in that 
percentage do not give credit to the United States for the 
security measures that we provide for them, but that is neither 
here nor there. Yours is a very good question. It is an issue 
that we all have to examine very closely, what we want to do. 
And I thank you for the question and I will get you some 
specifics.
    Mr. Blumenauer. I appreciate that very much.
    Mr. Hayes. Thank you.
    Mr. Blumenauer. Madam Chair, this is one area that is going 
to be very contentious for us.
    Ms. Hooley. Right.
    Mr. Blumenauer. And we want to do it right.
    Ms. Hooley. And I thank the gentleman for his testimony, 
and I, too, am very pleased that you brought up not only 
veterans healthcare but particularly the mental health piece. I 
think that is going to critical for every one of our returning 
soldiers. And I wholeheartedly agree with you for the Secure 
Rural Schools Act, that we should not be selling off our 
wonderful natural resources. So thank you very much for your 
testimony.
    Mr. Hayes. You are welcome. And just a quick comment on 
that, it is interesting, and I am sure that you have looked at 
it with the resources forest-wise you have in Oregon, there are 
some very isolated pieces. I wish we would sort of reshape the 
program so that these isolated pieces could be used to increase 
and enhance the main bodies of land that are the real, I mean 
it is all a treasure. But if you have got the forest here, and 
a small piece of acreage, the Forest Service is kind of slow 
talking about, ``Well, how do we trade this private piece over 
here which might be valuable to enhance the main part of the 
holding?'' So to the extent we can, that would be something I 
hope the Committee can, you know, help facilitate. Thank you.
    Ms. Hooley. And I am going to be turning this over, as 
Representative Turner comes up, to Ms. Kaptur.
    Ms. Kaptur [presiding]. I would like to welcome our 
colleague, especially because you are from the State of Ohio. 
We look forward to your testimony today, and I thank 
Congresswoman Hooley for the great job she has done. Welcome to 
the Budget Committee. We look forward to hearing your formal 
testimony.

STATEMENT OF HON. MICHAEL TURNER, A REPRESENTATIVE IN CONGRESS 
                     FROM THE STATE OF OHIO

    Mr. Turner. Madam Chair, let me state my appreciation for 
having a fellow Ohioan sitting in the Chair seat and Mr. 
Blumenauer thank you for being here and for the opportunity to 
testify before the Budget Committee.
    I am here to testify in support of the $8.2 billion request 
for the Base Realignment and Closure Account. This account was 
created to implement the recommendation of the 2005 Base 
Realignment and Closure Commission. The last round of BRAC was 
included in the 2002 National Defense Authorization Act. In 
2003, the Defense Department published a draft of the BRAC 
review criteria, and in March, 2004 DOD submitted the four 
structure plan and infrastructure inventory to Congress. 
Congress approved the final review process or criteria in 
April, 2004. In May, 2005 the Defense Department provided its 
closure and realignment Recommendations to the Base Realignment 
and Closure Commission. The Commission delivered its report to 
the President in September, 2005 and he delivered it to 
Congress the same month. The BRAC recommendations came before 
Congress on October 27, 2005 as H.J. Res. 65 in an attempt to 
disapprove the recommendations of the Base Realignment and 
Closure Commission. The House overwhelmingly defeated the joint 
resolution by a vote of 85 to 324 to 1. By defeating the 
resolution the House had the effect of supporting the BRAC 
recommendations. On November 9, 2005 the BRAC recommendations 
officially took effect, marking the end of a three-year process 
and the beginning of another six-year process of realignment 
and closure.
    Congress designed BRAC as a deliberate, slow process 
outside the political process. It is very hypocritical of 
Congress to create a process, support it, clamor for its 
funding, and then reduce its funding and authorization. The 
BRAC recommendations have the force and effect of law and it is 
the responsibility of Congress to see that the process is 
completed. The administration's fiscal year 2008 budget calls 
for the authorization of nearly $8.2 billion for BRAC 
implementation. This funding request is based upon the schedule 
created by the Department of Defense to meet the military 
construction needs as a result of BRAC. The full authorization 
of this account in the budget resolution is necessary to meet 
the statutory deadline imposed by Congress of 2011. A failure 
to meet the budget request level will jeopardize the 
implementation time line and degrade the readiness of our 
military facilities.
    The military services in many communities throughout the 
country have begun making specific plans to prepare for 
missions either lost or gained under BRAC. In the case of my 
community, Dayton, Ohio, partnerships between academia, 
industry, and research institutions formed to ensure that 
during the BRAC transition a minimal human capital impact 
occurs in the science and technology fields. A substantial 
funding cut to implement the BRAC recommendations risks the 
plans that my and other communities have spent months creating. 
A reduced authorization increases the risk that nationally the 
BRAC savings will be reduced, raises the chances of delaying or 
postponing scheduled redeployments of military personnel and 
their families, and undermines the BRAC process that Congress 
established.
    In fiscal year 2007 the House budget resolution supported 
the administration's $5.6 billion budget request for BRAC. The 
House Armed Services Committee fully authorized the funding for 
BRAC and the Military Construction Appropriations Subcommittee 
supported the funding of BRAC. However, the other body was not 
able to finish its work requiring the creation of continuing 
resolutions to fund government operations. The CR written by 
the new House majority cut BRAC implementation in fiscal year 
2007 by $3.1 billion, raising serious questions on whether the 
Department of Defense could meet the statutory deadline of 
2011. Representative Obey, Chairman of the House Appropriations 
Committee said last week that he is planning to add the missing 
BRAC funding to the war supplemental request that the 
administration submitted to Congress. If the Appropriations 
Committee does not provide additional funds for BRAC in fiscal 
year 2007 the House Budget Committee would need to increase 
fiscal year 2008 requests for BRAC by the $3 billion from $8.2 
billion to $11.2 billion in order to put the implementation 
time line back on track.
    Supporting $8.2 billion in fiscal year 2008 for BRAC is a 
necessary step toward realizing the savings from BRAC and 
protecting the integrity of the BRAC process. A majority of 
Congress supported BRAC and it was Congress that created the 
BRAC process. Including the requested $8.2 billion in the House 
budget resolution enables the military services and the 
civilian personnel to continue their planning for possible 
relocation.
    I encourage the Budget Committee to support the request for 
$8.2 billion for BRAC in the budget resolution, and I thank you 
Madam Chair.
    Ms. Kaptur. Thank you very much, Congressman Turner, and I 
would like to give my colleagues a chance to ask questions. I 
happen to be one of the designees from the Appropriations 
Committee to the Budget Committee, so I followed very carefully 
what you are saying. And my question is, let us just say the 
worst happened and neither the supplemental, though Congressman 
Obey has promised it, nor the budget mark would provide the 
funding that you seek to fully implement BRAC. What impact 
would that have, let us say in your district or Ohio? Could you 
verify for the record?
    Mr. Turner. Well, and my district is an excellent example 
because it is a domino effect. There are 1800 jobs that are 
being relocation to Wright-Patterson Air Force Base. Wright-
Patterson Air Force Base, as you know, is a research and 
development base predominantly. It is not planes and flying 
missions, it is research and development. From the early Wright 
Brothers plane all the way to Stealth, our advantage on the 
battlefields on tomorrow is developed, designed, and 
implemented at Wright-Patterson Air Force Base.
    When BRAC decided to send more jobs and missions to Wright-
Pat it did so with an analysis based upon savings that would 
occur by consolidating those missions at Wright-Pat. The monies 
that are sought in construction allow those missions to be sent 
to Wright-Pat, but are deemed to be savings that we later find 
in the budget as a result of those missions coming. There are 
not only individuals that are represented by those 1800 jobs, 
there families, there are businesses, there is planning, there 
are missions that could be lost, and future opportunities for 
ingenuity and work once the synergy of these missions being co-
located occurs. So the domino effect of what we miss is cost 
savings, opportunities to take advantage of the ingenuity of 
employees, and of course the impact on their lives.
    Ms. Kaptur. Thank you for clarifying that. For the record, 
I would like to ask our colleague Mr. Blumenauer if he has any 
questions or comments he would like to make at this point?
    Mr. Blumenauer. I appreciate your reference to BRAC, Madam 
Chair, Congressman Turner. This is an area of great concern to 
me as well, and I hope it is something the Budget committee 
will have a chance to focus on. I do not know quite how we put 
all the pieces together, but we have vast areas of formally 
used military sites, including some actually that are 
continuing to be used, that have not been appropriately cleaned 
up and transitioned. So there is a huge opportunity lost and 
because we do not adequately fund it it actually means that the 
unit cost to clean up and transition increases. And I would be 
interested, Congressman, in perhaps your reflections on ways 
that we might all work together to squeeze a little more value 
out of this process. Because I think we are leaving a lot of 
money on the table.
    I am concerned about you, but I had an amendment on the 
floor last year because Sacramento, which had a base closed in 
the first round of base closing, anticipates that it will be 
fully cleaned up in 2079. I do not think that is fair to you. 
It is not fair to people in prior round. And it is not fair to 
the public to have these important resources chewing up money 
and potentially being economically dangerous or environmentally 
dangerous. And I would really appreciate thoughts that you may 
have at some point that we might be able to work either through 
this Committee or some of our other mechanisms that we 
cooperate on to make progress on that.
    Mr. Turner. I appreciate Mr. Blumenauer raising that issue. 
I know he is a great advocate for urban areas and I have 
enjoyed our conversations about what we can do for economic 
development for communities. In my community, in addition to 
Wright-Patterson Air Force Base we also had a Department of 
Energy Mound Facility that was active in the deep space nuclear 
energy components. And it was decommissioned and is in the 
clean up process. And there, luckily DOE has worked in 
partnership with the community so that as land becomes 
available there is a master plan for its transition for 
economic readiness. But the biggest impediment is the time line 
of funding and completion of clean up in order for that land to 
be available. The community is having a great deal of 
difficulty in planning when the land as part of the partnership 
might be clean and available in order to attract additional 
economic capital. And I know that is a big concern of yours, so 
I would love to work with you on it.
    Ms. Kaptur. Thank you very much, Congressman Blumenauer. I 
might just say, Congressman Turner, you stayed within the time 
limit so well you have given me a chance to ring in as part of 
this triumvirate here on clean up. Because one of the most 
perplexing sites in the country is one that I represent. I 
think there are two sites in the country where there is 
ordinance that is buried under water. And it happens to be, one 
of those is in North Carolina, the other is in Lake Erie. And 
last year we were able for the first time to get mapping, 
because of new technology the Department of Defense has brought 
on line, to actually identify where this buried ordinance is. 
It is massive. And you have got 150mm shells, you have got who 
knows what under there. They do not shoot out into Lake Erie 
anymore, but the issue for us is how do we clean it up? There 
is no real, you would say, ``Well, the Army Corps of Engineers 
should clean it up.'' Guess what? They do not do water. That is 
the Army, they do land. And there really is not any naval 
facility up there on Lake Erie. But we have got all this stuff, 
and when I asked the DOD personnel who came out to survey the 
site when they did their preliminary work--by the way, the 
helicopter crashed. It crashed into Lake Erie. We lost the 
copter, but the people in it were okay because the boom caught 
the edge of a wave, I guess. They were too close to the water. 
But when they showed us the preliminary mapping it showed that 
on a scale of one to ten, it was a 7.5 to eight degree of 
damage. It is quite significant. But the question becomes, how 
do you clean it up? It is the same challenges that each of us 
face as we struggle with this.
    So I want to thank you, Congressman Turner and Congressman 
Blumenauer, for paying attention to these environmentally 
damaged sites and what we can possibly do to move toward 
cleaning them up. And you mentioned 2079, I mean my goodness. I 
doubt that the timetable for ours is much better than that, if 
at all. And so we look forward to working with you. Did you 
wish to state anything else for the record?
    Mr. Turner. Thank you, Madam Chair. I appreciate your 
interest and your time.
    Ms. Kaptur. Thank you so very much. Thank you for appearing 
today.
    Mr. Hayes. Madam Chair, if I might?
    Ms. Kaptur. I would be pleased to recognize the gentleman.
    Mr. Hayes. Thank you.
    Ms. Kaptur. Yes, Mr. Hayes.
    Mr. Hayes. Mr. Blumenauer, one thing I forgot when you 
asked a great question about adjusted gross income. In my 
district it goes from very urban in the west in Charlotte, very 
urban in the east in Fayetteville, in between very 
agricultural. A lot of our farmers, a couple of really big 
ones, are in that area next to the urban area. And what I do 
not want to have happen is a disincentive for them and their 
family members to keep farming and turn around that sell that 
land for development land. That was another piece of that 
concern that I had there. So thank you, Madam Chair.
    Ms. Kaptur. Thank you, and I am sorry I missed your full 
testimony, Congressman Hayes. But, believe me, I heard the 
questioning.
    Mr. Hayes. Thank you.
    Ms. Kaptur. We thank you for coming today. Thank you, 
gentlemen. I would to now call our next witness, Congressman 
Jason Altmire from the great Keystone State of Pennsylvania. 
Welcome, Congressman Altmire. We welcome you to the Budget 
Committee and look forward to your testimony.

 STATEMENT OF HON. JASON ALTMIRE, A REPRESENTATIVE IN CONGRESS 
                 FROM THE STATE OF PENNSYLVANIA

    Mr. Altmire. Thank you, Madam Chair, and thank you Mr. 
Blumenauer for being here as well. And thank you to Chairman 
Spratt for allowing us to come before the Committee.
    I appreciate the opportunity to testify today on the 
importance of the fiscal year 2008 budget resolution and its 
impact on western Pennsylvania. Before I begin, I ask unanimous 
consent to advise and extend my remarks.
    Ms. Kaptur. Without objection, your full statement and 
attachment will be placed in the record.
    Mr. Altmire. Thanks. In the President's State of the Union 
he outlined his budget priorities for the year: the need for 
fiscal responsibility, reducing the number of uninsured, 
investing in renewable energy, and protecting America's 
homeland security. But unfortunately, the President proposed a 
fiscal year 2008 budget that does not represent any of the 
rhetoric that we heard and instead continues the same failed 
policies of the past six years. If enacted, the President's 
fiscal year 2008 budget would not, as it claims, balance the 
budget within five years. The President ignores out year costs 
and uses overly optimistic economic forecasts in the name of 
fiscal responsibility to achieve balance in 2012. But an honest 
assessment of the President's budget shows that it never 
reaches balance and instead would increase the deficit by over 
$3 trillion over the next ten years.
    I believe we must begin the fiscal year 2008 budget process 
with a true accounting of where we are, and what we will be 
required to pay for over the next five to ten years. No more 
gimmicks in order to make a political statement. No more 
omissions of costs that wee all know we are going to have to 
face. We cannot continue to deficit spend in the trillions of 
dollars and pretend it does not matter. It only delays the 
inevitable and passes the tough decisions of today on to future 
generations.
    I would strongly encourage the Budget Committee and 
leadership in both chambers to adopt the fiscally responsible 
budget resolution. While we will not be able to dig ourselves 
out of the deep hole created over the last six years in just 
one year or perhaps even the next five, we can stop the 
bleeding and put us on the toward a balanced budget. Many of my 
colleagues have spoken here today about the need to invest in 
essential programs and priorities and I agree with many of 
them. But I will again emphasize to the Committee that the 
decisions about which programs to support and increase funding 
for must be made within the constraints imposed by adopting a 
fiscally responsible budget. And within that responsible 
framework I believe the fiscal year 2008 budget should focus on 
a core set of priorities: healthcare for veterans and seniors, 
educating our children, and assisting first responders to 
properly defend the homeland.
    We owe no greater debt than to our veterans and I urge the 
Committee to make sure that we fully fund their medical 
coverage and hospital services. The Veterans Affairs healthcare 
system is chronically underfunded, and even in the President's 
budget he shortchanges our nation's veterans' medical care by 
requesting insufficient funding. Over the next five years 
funding for the VA health system would be short $3.4 billion if 
the President's budget were enacted. In addition, the President 
asks veterans to pay a new enrollment fee and increased 
pharmacy copayments at a total cost of over $2 billion. Our 
veterans should be at the top of our priority list when it 
comes to making decisions about the federal budget. As our 
veterans have honorably served this country, we should honor 
our commitment to them by adequately funding their healthcare 
coverage.
    Approximately 124,000 Medicare beneficiaries reside in my 
district, so any changes to the Medicare Program are of deep 
concern to me and my constituents. After the President's call 
to address the healthcare crisis in this country, I was amazed 
to see his subsequent budget request reduce spending for 
Medicare beneficiaries by over $250 billion over the next ten 
years. I find this misguided at a time when the number of 
Medicare beneficiaries is growing every year, and the baby 
boomers are for the first time now starting to qualify for 
Medicare.
    The proposed budget also continues to demonstrate the 
President's failure to live up to his commitment to fully fund 
education programs for our children. K-12 spending is still $15 
billion below authorized levels. As a member of the House 
Education and Labor Committee, I believe it is critical to the 
future of this country for us to increase funding for No Child 
Left Behind and our K-12 schools. The new global economy 
requires a highly educated and trained workforce and we must 
meet our commitment to properly invest in the future of this 
country by increasing that funding.
    We must also address the mounting concerns of students and 
parents who are finding it harder to afford a college 
education. I believe we took an important first step during the 
first 100 hours by slashing student loan rates by 50 percent. 
But as a father of two, I share the concerns of millions of 
parents in this country who wonder how they are going to afford 
sending their children to college. The President's budget again 
takes us in the wrong direction, and I hope this Committee will 
reject many of his education proposals. Nine higher education 
programs are completely eliminated, leading to a cut of $1.4 
billion in financial assistance to students. The proposed 
increase in the maximum Pell Grant award is nothing more than 
robbing Peter to pay Paul.
    Most alarming to me are the proposed cuts to homeland 
security. Under the President's budget funding for first 
responders will be reduced by 42 percent. State homeland 
security preparedness grants are cut by 64 percent. And grants 
to firefighters are cut by 55 percent. Further, state and local 
law enforcement grants through the Department of Justice, the 
COPS Program, are nearly eliminated, which consequently 
deprives our local communities of the critical support they 
need to operate in this post-9/11 world.
    It is my hope that Congress can work in a bipartisan manner 
to move this country in a new direction with the adoption of a 
new fiscal year 2008 budget resolution. A new direction that 
properly accounts for every dollar of the federal government's 
spending and moves us towards great fiscal responsibility. A 
new direction that adequately provides for the health services 
of our veterans and our seniors. A new direction that invests 
in our children to ensure that they receive a proper education 
and the opportunity to attend college, and are sufficiently 
prepared to enter the workforce and compete in our global 
economy. A new direction that provides our local firefighters, 
law enforcement officers, and other first responders with the 
training and equipment required to defend our homeland.
    Again, I appreciate the opportunity to address the 
Committee today and outline my priorities in the fiscal year 
2008 budget. I yield back the balance of my time.
    [The prepared statement of Mr. Altmire follows:]

Prepared Statement of Hon. Jason Altmire, a Representative in Congress 
                     From the State of Pennsylvania

    Thank you, Mr. Chairman and members of the committee. I appreciate 
the opportunity to testify today on the importance of the fiscal year 
2008 budget resolution and its impact on western Pennsylvania. Before I 
begin, I ask unanimous consent to advise and extend my remarks.
    In the President's State of the Union, he outlined his budget 
priorities for the year: the need for fiscal responsibility, reducing 
the number of uninsured, investing in renewable energy, and protecting 
America's homeland security. Unfortunately, the President's proposed 
fiscal year 2008 budget does not represent any of the rhetoric that we 
heard and instead continues the same failed policies and misguided 
priorities of the last six years.
    If enacted, the President's fiscal year 2008 budget would not, as 
it claims, balance the budget within five years. The President ignores 
out-year costs and uses overly optimistic economic forecasts in the 
name of fiscal responsibility to achieve balance in 2012. An honest 
assessment of the President's budget shows that it never reaches 
balance and instead increases the deficit by $3.2 trillion over the 
next 10 years.
    We must begin the fiscal year 2008 budget resolution with a true 
accounting of where we are and what we will be required to pay for over 
the next five years. No more gimmicks in order to make a political 
statement. No more omissions of costs we all know that we are going to 
have to face. We cannot continue to deficit spend in the trillions of 
dollars and pretend it does not matter. It only delays the inevitable 
and passes the tough decisions of today onto future generations.
    I strongly encourage the House Budget Committee and leadership in 
both chambers of Congress to adopt a fiscally responsible budget 
resolution. While we will not be able to dig ourselves out of the deep 
hole created over the last six years in just one year or even the next 
five, we can stop the bleeding and put us on a path toward a balanced 
budget.
    Many of my colleagues have spoken passionately here today about the 
need to invest in essential programs and priorities, and I agree with 
many of them. But I will again emphasize to the Committee that the 
decisions about which programs to support and increase funding for must 
be made within the constraints imposed by adopting a fiscally 
responsible budget.
    Within a fiscally responsible framework, I believe the fiscal year 
2008 budget resolution should focus on a core set of priorities: health 
care for veterans and seniors, educating our children, and assisting 
first responders to properly defend the homeland.
    We owe no greater debt than to our veterans and I urge the 
Committee to make sure we fully fund their medical care coverage and 
hospital services. The Veterans Affairs health care system is 
chronically underfunded. In the President's budget, he has again 
shortchanged our veterans' medical care by requesting insufficient 
funding. Over the next five years, funding for veterans would be short 
$3.4 billion if the President's budget were enacted. In addition, the 
President asks veterans to pay a new enrollment fee and increases 
pharmacy co-payments at a total cost of $2.3 billion.
    Our veterans should be at the top of the priority list when it 
comes to making decisions in the federal budget. As our veterans have 
honorably served this country, we should honor our commitment to them 
by adequately funding their health care coverage.
    Approximately 124,000 Medicare beneficiaries reside in my district, 
so any changes to the Medicare program are of deep concern to me. After 
the President's call to address the health care crisis in this country, 
I was amazed to see his subsequent budget request reduce spending for 
Medicare beneficiaries by $252 billion over 10 years. I find this 
misguided at a time when the number of Medicare beneficiaries is 
growing every year and the baby boomers are for the first time now 
starting to qualify for Medicare.
    The proposed budget also continues to demonstrate the President's 
failure to live up to his commitment to fully fund education programs 
for our children. K-12 spending is still $15 billion below authorized 
levels. As a member of the House Education and Labor Committee, I 
believe it is critical to the future of this country for us to increase 
funding for No Child Left Behind and our K-12 schools. The new global 
economy requires a highly educated and trained workforce and we must 
meet our commitment to properly invest in the future of this country by 
increasing funding for K-12 schools.
    We must also address the mounting concerns of student and parents 
who are finding it harder and harder to afford a college education. I 
believe we took an important first step during the first 100 hours in 
slashing student loan rates by 50 percent. But as a father of two, I 
share the concerns of millions of parents who wonder how they are going 
to afford sending their children to college. The President's budget 
again takes us in the wrong direction and I hope the Committee will 
reject many of his proposals. Nine higher education programs are 
eliminated, leading to a cut of $1.4 billion in financial assistance to 
students. The proposed increase in the maximum Pell Grant award is 
nothing more than robbing Peter to pay Paul.
    Most alarming to me are the proposed cuts to homeland security: 
Under the President's budget, funding for first responders will be 
reduced by 42 percent, state homeland security preparedness grants are 
reduced by 64 percent, and grants to fire fighters are cut by 55 
percent. Further, state and local law enforcement grants through the 
Department of Justice--the COPS program--are nearly eliminated, which 
consequently deprives our local communities of the critical support 
they need to operate in a post-9/11 world.
    It is my hope that Congress can work in a bipartisan manner to move 
this country in a new direction with the adoption of the fiscal year 
2008 budget resolution. A new direction that properly accounts for 
every dollar the federal government spends and moves us toward fiscal 
responsibility. A new direction that adequately provides for the health 
care services of our veterans and seniors. A new direction that invests 
in our children to ensure they receive a proper education and the 
opportunity to attend college, and are sufficiently prepared to enter 
the workforce and compete in the global economy. A new direction that 
provides our local firefighters and law enforcement officers with the 
training and equipment required to defend our homeland.
    Again, I appreciate the opportunity to address the committee today 
and outline my priorities for the fiscal year 2008 budget resolution. 
Thank you, Mr. Chairman and members of the committee. I yield back the 
balance of my time.

    Ms. Kaptur. Thank you, Congressman Altmire, very, very much 
for your time today. I note that in your excellent testimony 
that you have prioritized veterans healthcare at the top of 
your list, and I think it is propitious that the Chair of the 
Veterans Affairs Committee here in the House, Congressman 
Filner just happens to be awaiting testimony himself and what a 
find job he has done in attempting to increase funding for our 
veterans.
    I am going to ask my colleagues, Mr. Bishop and Mr. 
Blumenauer, if they have any questions or comments they wish to 
make at this point regarding your testimony?
    Mr. Altmire. Thank you.
    Ms. Kaptur. All right, very good. Thank you. The Committee 
will place into the record your testimony as well as any 
additional attachments that you wish to provide, and we will 
note your priorities as we struggle to make the different 
budget marks across the various categories for which we have 
responsibility. So we thank you so very much for coming today.
    Mr. Altmire. Thank you, Madam Chair.
    Ms. Kaptur. The very best to you in your first term. I am 
now going to call Congressman Jim Matheson of Utah. And 
Congressman Bishop will take the Chair at this point.
    Mr. Bishop of New York [presiding]. Congressman Matheson, 
welcome to the Budget Committee.
    Mr. Matheson. Thank you.
    Mr. Bishop of New York. You are now recognized for ten 
minutes.

 STATEMENT OF HON. JIM MATHESON, A REPRESENTATIVE IN CONGRESS 
                     FROM THE STATE OF UTAH

    Mr. Matheson. Well, thank you. I will tell you up front I 
do not think I am going to take all ten minutes. There have 
probably been a series of members come through all day on 
Member Day for the Budget Committee, and I suspect every member 
who came here asked for more money for something. That is the 
challenge you face as the Budget Committee, is when you set a 
budget you have got to prioritize among a number of great ideas 
and you cannot do everything for everyone.
    I am very concerned about the lack of fiscal responsibility 
that this country has undergone in the last few years, and so 
what I wanted to talk to you about today is if we could make 
some effort to return to the fiscally responsible policies we 
had in the past decade. This Congress, this House of 
Representatives at least, made an important first step when in 
establishing the rules at the start of this Congress it 
included PAYGO. And that is a good thing. But as I said, that 
is a good first step. If we want to recreate the dynamic that 
existed, that started in the early nineties, we need to have 
statutory PAYGO and we need to have spending caps as well on 
discretionary spending. It is going to force tough decisions, I 
get it. It is always tough when you have to live within a 
budget. But for the fiscal health of this country I would 
suggest that as this Committee undertakes the process of 
creating a budget resolution for the next fiscal year, I would 
say that looking at budget enforcement mechanisms that were 
successful, and we have the model that shows how they were 
successful, I would submit that those ought to be on the table 
as well. And so I want to come and make a pitch for that, 
recognizing that if we have to live under those restrictions we 
as members of Congress all have to face some real tough choices 
for how to live within those restrictions. But I think that is 
what we were elected to you and I suggest that that ought to be 
part of what we are looking at in the budget process today. And 
just to show I am doing my part, I am going to offer you three 
quick items where I would suggest we probably ought to cut.
    First of all, there is a program called the Reliable 
Replacement Warhead Program for replacing our current nuclear 
weapons warheads in our arsenal. It is projected in the 
President's budget to spend another $120 million this year. One 
of the chief justifications for moving ahead with replacing all 
these warheads is there was concern that the plutonium in the 
existing warheads was deteriorating and so we had to have new 
warheads. But the JASON Study, which just came out in December 
of last year, said it turns out the plutonium pits are not 
deteriorating, that they are good for a couple of hundred 
years. And so it is not clear to me what the need is to jump 
ahead with this new program, which I suspect is going to be a 
new effort at developing new types of nuclear weapons quite 
frankly. And I would submit that in the currently difficult and 
challenging fiscal times we live in right now, perhaps not 
moving ahead with the Reliable Replacement Warhead at this time 
would be a more prudent cause to take.
    Secondly, a broader effort in terms of changing our nuclear 
weapons arsenal is the program called Complex Twenty Thirty. 
Now, there is not cost estimate for this effort that has been 
released. It is estimated to be in the billions of dollars. 
Again, I would submit that we, instead, as a measure that would 
be more fiscally responsible and I think adequate for our 
nation's security needs, to continue with the existing 
Stockpile Stewardship Program, that is what it is called. And I 
think that would be another area where we could experience 
savings in our budget in the next few years.
    And finally, a third item, the proposed storage facility at 
Yucca Mountain for spent nuclear fuel. There a lot of issues 
about this facility that I think are fair questions to be 
raising. I have concerns about the transportation risks of 
bringing this material to Yucca. There are concerns about the 
scientific data that has been used to justify using this, and 
you are probably familiar with reports over the years where 
scientific data has been called into question and the project 
has been delayed, and delayed, and federal money keeps getting 
poured into this project. The problem often for people who say 
they oppose this project is they do not really offer a solution 
or an alternative. And I would submit to you that there is an 
alternative. It is reflected in legislation introduced in the 
past Congress by Senator Reid in the Senate, and I introduced 
it in the House. It calls for interim onsite storage, where 
waste each site would be converted into dry cask storage units. 
The federal government would take title, and it would stay on 
site.
    Now, when the Nuclear Waste Policy Act in 1982 was passed, 
which was the precursor to the Yucca Mountain discussion we are 
having here twenty years later, no one had heard of dry cask 
storage because that was a technology that did not exist. The 
point is is that technology does advance and things change. And 
when I say ``interim onsite storage,''dry cask storage is a 
200-year solution. It is not a permanent solution, but it is a 
200-year solution. It gives us a couple of hundred years for 
technology to maybe take us to a new place for what we could 
do. And that would be a third item where I would submit that we 
could save money in this budget.
    So, just for fun I though I would, the real reason I came 
here was PAYGO spending caps, statutory, let us show fiscal 
responsibility. But just to throw in my two cents I thought I 
would offer three areas where I think we could save some money 
in the budget and with that I yield back the balance of my 
time.
    Mr. Bishop of New York. Mr. Matheson, thank you very much. 
Mr. Blumenauer, any questions? Ms. Kaptur?
    Ms. Kaptur. I just want to thank the gentleman for his 
testimony, particularly he is a member of the Defense 
Appropriations Subcommittee. I will take very close note of the 
programs that you have mentioned, and unfortunately did not 
receive a copy of your testimony at my place here but I am 
going to take it to our Defense Appropriations hearings and we 
will well consider what you have recommended. Thank you so 
much.
    Mr. Matheson. Great, I look forward to working with you on 
that. Thank you so much.
    Mr. Bishop of New York. Thank you very much for your 
testimony. The next member we will hear from is the Chairman of 
the Veterans Committee, Mr. Filner of California.

STATEMENT OF HON. BOB FILNER, A REPRESENTATIVE IN CONGRESS FROM 
                    THE STATE OF CALIFORNIA

    Mr. Filner. Thank you, Mr. Bishop, and colleagues. I 
appreciate the work you are going through. Ms. Kaptur, I heard 
your plea for help to clean up the ordinance. I am sending the 
Navy from San Diego directly to Lake Erie. We will figure that 
out.
    I have a prepared testimony that you have, but I am just 
going to talk briefly on the high points. Although the current 
administration will boast that it has improved the funding for 
veterans, and especially veterans healthcare, an incredible 
figure, I think they say 80 percent, 70 percent dollar amount, 
we have gone backwards during this administration. Because of 
inflation and the increasing needs of veterans, the absolute 
dollars have not met the real needs and we have great amount of 
neglect to make up with the new Congress. I think we have, as 
you know more than any other Committee, pent up demands in lots 
of areas. We make campaign promises in lots of areas. And we 
are not going to be able to meet all these needs overnight. But 
we can have a plan over time to meet them. We have to meet 
these needs, I think, in installments.
    The first installment for veterans you have already made. 
You and the Appropriations Committee by increasing the 
continuing resolution for 2007 by $3.6 billion, sending an 
incredible signal across the country that this Congress was 
going to take care of veterans. You cannot believe the powerful 
and optimistic feedback we have had because of the C.R. that 
was passed with that money. So we have done our first step as a 
Democratic Congress, I think, in showing that veterans are 
going to be met.
    I think in the second installment, that is in fiscal year 
2008, we have to take care in a visible way of those young men 
and women, and brave young men and women coming back from Iraq 
and Afghanistan. Tremendous physical injuries, loss of limbs, 
brain injuries, equally traumatic injuries of the mind that we 
have to take care of. I do not care how we are going to vote on 
this resolution on the floor right now about the War, but we 
are going to be committed as a part and as a Congress to taking 
care of every young man and woman who comes back from that War. 
And we are going to take them and give them the care and love 
that they deserve and have earned. If we can pay for the War, 
we can pay for the warriors.
    So our next installment of meeting the needs, in this 2008 
budget we have to take care of the healthcare of those 
returning veterans. The President's budget was a shell game. He 
upped the absolute dollar amount for the first year of 6 
percent for healthcare, but over the five-year period actually 
cut dollars for healthcare. We cannot do the same thing. And I 
think our Committee is going to recommend a 12 percent increase 
for healthcare in this first year.
    And of course, we want to show that we are taking care not 
only of the incredible physical damage but the mental health 
needs. PTSD, Post Traumatic Stress Disorder, which has become 
the catch all phrase. We know when we did not treat the mental 
needs of those coming back from Vietnam we have tremendous 
problems today. Half of the homeless on the street tonight are 
Vietnam vets. We see the same thing happening already with our 
Iraqi vets. They are going through the same thing, and we know 
how to prevent it. We have to have the outreach and the 
resources available to meet the needs and we are going to do 
that with your help in this Congress.
    And of course, we have to make up more money than the 
President's budget assumed, an enrollment fee for certain 
veterans and a double co-payment on pharmacy items which this 
Congress is not going to approve. So we are going to have to 
find that money in additional areas. So we have to take care of 
those health needs.
    I would like you to keep in mind one further need for 2008. 
We have tremendous obligations to past veterans. World War II, 
sixty years ago, we still have veterans alive. They are in 
their eighties, some already in their nineties. There are 
several injustices which we must correct because they are going 
to die in the next budget cycles. We have veterans, we call 
them atomic vets, who were not told about the dangers of being 
in the test zones, have cancers and they are being forced to 
prove that there is a relationship between their service in the 
armed forces and their cancer. This should be a presumptive 
thing, and we have to take care of these men.
    In addition, sixty years ago the Filipino veterans, 
Filipino soldiers fought in the Pacific, helped us when that 
War. We took away as a Congress their benefits in 1946. They 
are not interested in money in return, but they would like to 
have the honor and dignity of being American veterans. I think 
we can do that. It is accomplishable within our budget.
    Lastly, the merchant mariners of World War II took 
tremendous losses. They helped us when the battle in the 
Atlantic. There is less than 10,000 alive. They were never 
given the advantages of the Bill of Rights that was so 
important to other veterans. They never got the education or 
the housing benefits. We have legislation which we will 
recommend to you that, again, is not a lot of money but says 
thank you to these merchant mariners of World War II.
    Our job will not be finished with this budget. But we have 
to see it, I think, hopefully that with Democrats in the 
majority we will continue our installment of paying down the 
debt that we need to our nation's veterans. We promised in the 
campaign a 21st century GI Bill. That means updating the 
education benefits, the housing kinds of allowances that are in 
there. But in addition, are Guard and Reserve units, who are 
taking half of the fighting burden in Iraq, do not have the 
same access to the GI Bill. We have to give that to them. They 
have deserved it, they have earned it.
    We have, as I said, over 200,000 homeless vets on the 
streets of America tonight. That is a tremendous moral blot on 
our nation. We can still do something about that if we so 
choose. There are lots of things to do. There are greater 
demands than we have the money for. But I think, as we showed 
in the C.R., that when they put that money in and if we 
adequately care for the items that I mentioned in 2008 we will 
have the veterans on our side. They will see that we are 
committed to them and we will continue to address their needs 
until we have met them all in the coming budgets of America.
    I thank you for your Committee's work. It is a tough job, 
especially when they have given us this incredible debt to dig 
ourselves out of. We not only have to make up for past problems 
but we have to try to balance the budget also. That is a 
tremendous job. We are going to have to work together as a team 
to do it.
    Thank you for what you are doing.
    [The prepared statement of Mr. Filner follows:]

  Prepared Statement of Hon. Bob Filner, a Representative in Congress 
                      From the State of California

    Chairman Spratt, Ranking Member Ryan, thank you for hearing my 
views regarding the proposed FY 2008 budget for the Department of 
Veterans Affairs (VA). The Committee on Veterans' Affairs held a 
hearing last week on the VA's FY 2008 budget submission. Today, our 
Subcommittee on Health is holding a hearing on the VA's medical care 
budget request. We are beginning the process of working on our views 
and estimates, which we will submit to this Committee on March 1, 2007. 
Our views and estimates will contain concrete recommendations regarding 
the points I will be touching upon briefly today.
    Caring for our veterans is an ongoing cost of war, and a continuing 
cost of our national defense. As a Congress, and a nation, we must 
fulfill our obligations to the men and women who have served.
    In a paper released last month, Linda Bilmes, of the John F. 
Kennedy School of Government of Harvard University, estimated that the 
long-term costs of providing veterans' disability benefits for 
returning servicemembers may range from $68 billion to $127 billion. 
She also estimates that the cost of providing health care may reach 
$315 billion over 40 years. These are indeed staggering numbers. As we 
spend hundreds of millions of dollars a day on operations in Iraq and 
Afghanistan, we must begin to meet the needs of our veterans. I do not 
believe that the Administration's budget request does this.
    I am pleased that the Administration asked for an increase in 
appropriated dollars this year for veterans' health care. The 
Administration has requested a $1.9 billion increase over the FY 2007 
levels* for the three accounts that comprise veterans' medical care. 
This recommended increase was a welcome departure, and stands in sharp 
contrast to two years ago, when the Administration requested an 
increase in appropriated dollars of less than one percent. The VA also 
estimates that the costs attributable to inflation will be $1.4 billion 
for FY 2008. When these costs are subtracted from the recommended 
increase, the VA will have precious few resources to meet its ever-
growing commitments. Indeed, if the Administration's proposal is a 
first step, we have a long journey ahead of us.
---------------------------------------------------------------------------
    *Note that the FY 2007 levels referenced throughout my testimony 
refer to the levels in H.J. Res. 20, the joint funding resolution that 
passed the House of Representatives on January 31, 2007.
---------------------------------------------------------------------------
    The Administration's request amounts to a 6 percent increase. We 
provided a 12 percent increase this year over FY 2006 levels. The 
Independent Budget and The American Legion, in testimony before my 
Committee both recommended more than a 12 percent increase for FY 2008. 
The Vietnam Veterans of America recommended substantially more.
    Although requesting an increase for VA medical care for FY 2008, 
the Administration's budget also proposes cutting VA medical care by 
$3.4 billion below current services levels from FY 2008-FY 2012. I 
believe that this Administration should stop playing budget games with 
the health and well-being of veterans.
    In the area of mental health, the VA is requesting an additional 
$56 million for a total of $360 million for its Mental Health 
Initiative. The VA's budget submission also claims that the VA plans to 
spend $3 billion for mental health services. The GAO has reported in 
November that the VA failed to fully allocate resources pledged in FY 
2005 and FY 2006 for this Mental Health Initiative. Mental health and 
post-traumatic stress-disorders (PTSD) are a serious problem facing our 
returning servicemembers, and an ongoing issue facing veterans from our 
previous conflicts. I believe we must do more in this area, and will be 
recommending increased resources for mental health.
    Traumatic Brain Injury (TBI) is considered by many to be the 
signature injury of this war. We must ensure that the VA has the 
resources it needs to begin tackling the issues surrounding TBI, as 
well as the resources it needs for VA Polytrauma centers to treat our 
most grievously wounded veterans. In the area of prosthetics we must 
make sure that veterans are provided with state-of-the-art equipment. I 
will be recommending increases in these areas.
    Homelessness among veterans is an ongoing problem, and a major 
concern of the Committee on Veterans' Affairs. Over the course of the 
year VA estimates that 400,000 veterans will experience homelessness at 
some time. Through an array of programs, VA assists 25 percent of that 
number and the community based organizations serve 50,000. The FY 2008 
budget requests $107 million for the VA's Grant and Per Diem Program 
and Special Needs Grants. Last year, P.L.109 -461 authorized $130 
million for this program. I will be recommending that VA's homeless 
programs receive additional funding.
    The VA is facing a backlog of over 600,000 claims. Over the coming 
months my committee plans on addressing this intolerable backlog. There 
are many reasons why we are facing a backlog of this magnitude, but 
clearly funding is needed to hire more claims processors, and I will be 
recommending additional funding in this area.
    Once again this year, the Administration has included legislative 
proposals that would levy a health care enrollment fee and sharply 
increase pharmaceutical co-payments. In a departure from last year, the 
Administration deems the revenues it projects from these proposals to 
be ``mandatory'' revenues. Although these dollars are not directly 
subtracted from VA's discretionary accounts, they are subtracted from 
VA's mandatory accounts and we will need to provide funding for these 
once they are rejected by Congress yet again.
    Finally, I am concerned that the VA's budget request does not 
include adequate funding to meet the health care needs of our veterans 
in the coming year. We are still faced with the Administration's 
refusal to ban enrollment of new priority 8 veterans, which has been in 
place since January, 2003. Although the VA was granted the authority to 
curtail enrollment when faced with unexpected shortfalls in revenues, 
this authority was never meant to be permanent. I believe that we must 
revisit this issue and find ways to ensure that all veterans have 
access to the VA health care system, including priority 8 veterans, 
rural veterans, and veterans with special needs. The VA's FY 2008 
budget request for long-term care further reduces the Average Daily 
Census (ADC) level to 11,000 for nursing home care. The Veterans 
Millennium Health Care and Benefits Act (P.L. 106-117), which was 
enacted in 1999, requires the VA to maintain an ADC 13,391. The VA has 
not requested funding in order to comply with its long-term care 
obligations.
    In the area of medical and prosthetic research, the Administration 
has recommended a cut in appropriated dollars below the FY 2007 level. 
In order to account for the rate of biomedical inflation, I believe 
that we should provide at least a $15 million increase for this 
account.
    Mr. Chairman, this concludes my remark. We have a lot of work ahead 
of us if we are to keep our promises to veterans. Working together, we 
can make sure that our veterans are not forgotten, and that we meet our 
obligations to them as a nation.
    Thank you.

    Mr. Bishop of New York. Mr. Filner, thank you very much for 
your testimony and thank you for your service as Chairman of 
the Veterans Committee. If I could just make a comment and ask 
a question. One of the things that the President has been 
saying about his budget is that it comes to balance in five 
years without a tax increase. I think we all know that that is 
wishful thinking at best if not an outright fiction, because it 
does not recognize costs associated with the War in Iraq nor 
does it recognize the cost of fixing the AMT. But also it is 
shot through with increases in fees, and increases in fees are 
simply a tax increase by another means. Could you talk more 
about the increase in fees proposed for veterans for access to 
healthcare and for pharmaceuticals and what the impact would be 
on the veterans population?
    Mr. Filner. The administration has proposed this year and 
in past years, slightly different this year, an enrollment fee 
on what they call ``lower priority veterans,''that is veterans 
who do not have service connected disability or who are of 
``high income.'' High income, by the way, means over $25,000. 
But their enrollment fee, which is up to $250 a person, could 
lead to they say, and they say it with great glee I am afraid, 
that several thousand veterans would leave the system. To me, 
we should be expanding the system not contracting it. But they 
estimate that if the enrollment fee goes through, several 
hundred thousand veterans will not be able to afford the 
system. They have the same in Tricare, by the way, which is not 
under Veterans but under Armed Services. Their increases in 
Tricare, they believe, will also lead to about a quarter of a 
million retirees to leave the system. I think that is 
disgraceful, to say we set up a system and say goodbye.
    In addition, the copays for medicines, pharmaceutical 
items, will double for many veterans, most veterans. That again 
is going to make life extremely difficult because that 
copayment is per medicine and per month. So it looks as if it 
is going up from eight dollars to fifteen dollars. But if you 
are dealing with ten medicines, ten times a year, I mean the 
fee is very, very great and we see what happens with our 
seniors when they cannot afford it. They cut the medicines, 
they do not take them when they should and that leads to deaths 
and other problems. So we should not even entertain those fees. 
But that leaves us money to make up in the budget.
    Mr. Bishop of New York. Thank you very much, Mr. Filner. 
Ms. Kaptur?
    Ms. Kaptur. Thank you, Mr. Chairman. First of all, I just 
want to say Chairman Filner we are so proud of you and the work 
that you are doing and will do as Chairman of the Veterans 
Affairs Committee.
    Mr. Filner. Thank you.
    Ms. Kaptur. I know how totally dedicated you are to it, and 
you know such a great deal about it and you are young enough to 
really make a difference. So I just wanted to comment on the 
issue of fees. I had a veteran come up to me who was over 
eighty years of age and who was on something like twelve 
medications, a World War II veteran. I wondered after I dealt 
with him whether you might just advisedly take this, after a 
veteran reaches a certain age, especially eighty, should we not 
just let them have the medicine that their doctor prescribes? I 
mean, this poor soul had lost his wife, he did not have a 
telephone, life was hard enough. It just seems to me that at 
some point unless they are multi-billionaires they should not 
have to go through all that confusion of copays and all the 
rest. So I just thought I would mention that while you are here 
before us today. You do not have to comment.
    Mr. Filner. Thank you.
    Ms. Kaptur. But I am sure you as well as I and other 
members have confronted this. Secondly, congratulations to you 
on your understanding of the needs of our homeless vets and 
those who will face neuropsychiatric damage as a result of 
deployment. I want you to know you have a total ally in that 
cause in this member. And when I began my service in Congress 
as a member of the Veterans Affairs Committee, it was very 
troubling to look at how many individuals in our VA Hospitals 
were there with chronic mental illness and substance abuse. And 
yet, if one looked at the peer review groups for research 
within the VA and the types of docs and nurses we were bringing 
on, how understaffed we were in terms of neuropsychiatry and 
psychiatric nursing, as a member of the Appropriations 
Committee I am there to help you. On research, on staffing, I 
want to do the same with DOD, to really finally grapple with 
this in a proper way.
    I would mention that there are several members, including 
Congressman Moran, Congressman LaHood, who have introduced a 
bill dealing with mental illness. At least it is a step 
forward. Dealing with PTSD, other psychiatric conditions that 
onset, I think we have to go way beyond that in terms of 
dedicating research dollars, which I would like to do as a 
member of the DOD Appropriations Committee in this arena. 
Perhaps you might consider some type of convening for members 
who hold deep interest in this. It is quite deep in this 
Congress and we have never been able to meet with one another 
on that subject. Perhaps not as a member of the Budget 
Committee but to invite members on this subject before your 
Committee, I would certainly be one that would show up.
    And then finally, in a very provincial way, I just wanted 
to mention that I represent one of the two VA clinics in the 
country that is not in the state of its mother hospital. This 
is unbelievable. And it causes so many problems because it is a 
cost center for a hospital located about an hour away for us in 
Michigan. We are from the State of Ohio. I would just prevail 
upon you, if you have staff that could work with us so we could 
figure out how to get an independent affiliation or an 
affiliation with our own medical center so our vets do not have 
to travel such a distance. I think this is the time to do it, 
especially with all these returning vets and everything that we 
are being faced with in our region. This particular 
administrative complexity is quite vexing and one that we need 
to fix.
    Mr. Bishop of New York. Thank you very much, Congressman 
Filner.
    Mr. Filner. Thank you. But just on PTSD again, thank you 
for your incredible support of that. You know, if I was the 
President right now, when he asked for support of our troops, I 
would be saying every community, every family, children, must 
know what PTSD is so we can envelop these young kids when they 
come back and recognize the symptoms and help direct them. 
Because the major problem is, they cannot talk to anybody about 
it, they feel. And there needs to be an understanding and not a 
turning away. I would like to, I am trying to get someone to 
make a film, by the way, for the children. There must be a 
million kids of those who are deployed now, recently deployed, 
will be deployed. If you had a Sesame Street thing for kids, so 
if Mom or Dad came home and there was some domestic violence 
and Johnny said, ``Dad, you have got PTSD. You had better get 
to the clinic.''That would have enormous impact. But we have 
got to have that outreach to families, to children.
    So I hope we can do that, and as you suggest, a summit 
meeting as it were. We should have that. I need to ask one more 
thing. I am thinking about other means of financing given these 
tight budgets. Do you know that we do not have a way within the 
VA to do a rapid canvass of whether a veteran has private 
insurance that ought to pay? We do not have a way to do that, 
yet there are systems today I could do that with five seconds 
through a computer, have access to what the private insurance 
that anybody has. We have to tap into that far more.
    By the way, Medicare does not pay for veterans if they go 
to the VA. And that is, from your perspective that is just a 
shift of resources. But for the VA it could be meaningful if, I 
don't know, if Medicare paid fifty cents on the dollar, twenty 
cents on the dollar, whatever, to help. Because VA does things 
in a very cost effective manner, it would save Medicare money 
to do that.
    And lastly, the NIH does a lot of research through the VA 
but does not reimburse for what they call indirect costs. 
Multi-million dollars of stuff there that ought to be helping 
our veterans, and yet are in other parts of the budget.
    So I will continue to work with this. I know we have 
tremendous, you guys have a tremendous difficulty. You know, we 
have got to meet the demands that our constituents have and 
they have not been met for, you know, almost a decade. And yet, 
we want to balance the budget too. So we will be working with 
you to do it.
    Mr. Etheridge [presiding]. Thank you. Thank you for being 
here, and thank you for your testimony. As someone who 
represents one of the largest military bases in this country, 
Fort Bragg, and a lot of veterans, we thank you for your 
service. Thank you.
    Mr. Filner. Thanks.
    Mr. Etheridge. Mr. Chairman, we are going to talk 
transportation. Mr. Oberstar, thank you for being here, sir. 
You are recognized for ten minutes.

 STATEMENT OF HON. JIM OBERSTAR, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF MINNESOTA

    Mr. Oberstar. Thank you, Mr. Chairman. And I appreciate the 
opportunity to come once again before the Budget Committee. It 
is a very familiar room. This once was the hearing room of the 
Committee on Merchant Marine and Fisheries, when I started here 
in the Congress in 1975. And there was only that upper tier of 
desks. It was not this fancy. And there was a little plywood 
table added to the end for me. I had the lowest seniority on 
the Committee at the time. Then years later, this was converted 
into the Budget Committee.
    I thank all of you who serve on the Budget Committee for 
your tedious work. And it is tedious, time consuming, to pay 
attention to the respective needs of committee chairs and 
individuals members on the effect of the budget on our 
respective programs.
    After careful review of the administration's budget for the 
programs under the jurisdiction of our Committee, we have 
concluded on a bipartisan assessment that there are not only 
serious shortcomings but it greatly under funds much of the 
nation's critical infrastructure in aviation, public transit, 
Amtrak, waste water treatment. It is not a step forward but a 
step back. For example, in the FAA, the AIP Program is 
authorized at $3.7 billion but the administration requests 
$2.75 billion. So it is roughly a billion dollars low.
    That is serious for the AIP. AIP is the construction of 
runways, taxiways, parking aprons, the hard side of the air 
operations of airports. It is serious because in the three 
years after September 11th, airports diverted their capacity 
construction funding from taxiways, runways and parking aprons 
to security needs in the terminal to accommodate stationing of 
and security needs of explosive detection systems and of the 
baggage clearing process that is hidden from passengers 
underneath the airport terminal itself. They spent $3 billion 
of AIP funds on security projects and have not been compensated 
for that by the Homeland Security Department or by the general 
revenues of the federal government.
    Now, air traffic is up, inplanements are up, air operations 
are up, they are reaching pre-2001 service levels. Worldwide 
last year a billion people traveled by air, 750 million of 
those traveled in the U.S. airspace. We are 70 percent of all 
the aviation travel in the entire world. We need now to expand 
runway capacity and yet this administration under funds the AIP 
Program. You are not going to be able to add capacity or 
accommodate the growth needs of airlines if we do not invest in 
the hard side of airport investment needs.
    In the modernization of air traffic control, the F and E 
Account, Facilities and Equipment Account as it is called, our 
authorization for the next fiscal year, which would have, I 
mean it is for the current fiscal year but it would have been 
for next year, the program expires, we have to reauthorize it 
this year. But it would be at a level of $3.1 billion. The 
administration request is $600 million below that, $2.5 
billion.
    Now, you do not just go and buy air traffic control 
equipment off the shelf at Radio Shack. You do not go sign up 
with Dell Computers and say, ``Send us a standard terminal 
automation replacement system.'' These are highly 
sophisticated, real time computers that are almost the size of 
that television screen down here. They track aircraft real 
time. It is not data retrieval. You need highly sophisticated 
computer programming. For example, in going from the previous 
TRACON technology of 300,000 computer lines, FAA had to 
increase capacity 1,300,000 computer lines of code. That took 
years in development, and it has to be continually revised as 
the system evolves and more traffic moves.
    But the air traffic controller is managing aircraft that 
are moving ten miles a minute at seven miles in the air. They 
have to make instantaneous judgments. They have to have 
instantaneous feedback. That takes huge capital investment to 
continue the modernization of the air traffic control, keep it 
current with developments in aviation. We are seeing more 
aircraft in the skies today than in 2001. Airlines are 
increasing using point to point service, using regional jet 
aircraft. That means more work load at air traffic control 
facilities, both in the end route centers, that is where 
aircraft are managed at altitude above 29,000 feet, and then 
the airport environment, forty miles out from the airport. That 
system needs to be connected now to satellites, so that 
satellite technology will relieve the air traffic controller of 
a great deal of the tedium of managing air traffic on a moment 
to moment basis. That will take huge investments in the future, 
not a decrease in funding as this administration is proposing.
    In the surface transportation we had quite a success in the 
C.R. where the Appropriations Committee fully funded to the 
level of the authorized amount of $39 billion. But in the 
administration's submission for the 2008 budget, at the very 
time that this administration is launching with big ballyhoo a 
Congestion Reduction Initiative, they propose to cut $300 
million out of the transit account of the Highway Trust Fund, 
$300 million below the amount we authorized and you voted for 
in 2005. If you want to deal with congestion you have to invest 
more, not less, in transit.
    In Amtrak, the administration proposes an $800 million 
budget. Well, two years ago David Gunn, the President of 
Amtrak, said if this administration requests the $1.2 billion 
budget for Amtrak we shut it down. We need more than that. This 
administration, now again, as they do every year, comes in with 
a low number for Amtrak, expect Congress to make up the 
difference, and then talk about, ``Well, we need reforms.''What 
they mean by reform translates to abolish. That is really what 
they want to do, is abolish Amtrak. I can only say that because 
they have been working on it for six years.
    All around the world other countries are investing in high 
speed, inter-city passenger rail. The French, with their highly 
successful TGV have already committed $6.5 billion to upgrade 
their system and add new lines, add more service. Italy 
invested $6.8 billion. Denmark, little Denmark is about the 
size of three counties in my district, has invested $9.5 
billion in high speed rail systems. We ought to do, we ought to 
at least keep Amtrak afloat and that means a budget of at least 
a $1.3 billion.
    In the Environmental Protection Agency, the State Revolving 
Loan Funds have averaged $1,350,000,000 over the last ten 
years. That is to build waster water treatment facilities, 
water lines, sewer lines, interceptor sewers. And this current 
budget is half that amount. It is $687.5 million. We have a 
bill that we reported from Committee, we are ready to bring it 
to the House floor, to replenish the State Revolving Loan Funds 
at $20 billion over the next five years. That is doubling the 
existing amounts. States are falling behind. Sewage treatment 
plant capacity is inadequate to meet current demand. Most of 
these plants are thirty-plus years old. They need to be 
upgraded. We are discharging waste in combined sewer overflows, 
combined sanitary and storm sewer overflows, polluting creeks 
and rivers and streams and lakes, and this administration at 
that very moment proposes to cut the funding for the State 
Revolving Loan Fund. I urge you not to do that.
    Finally, in the Corps of Engineers the administration 
proposes a 45 percent cut in what we call the Investigations 
Account. That is authorizations and directions Congress has 
given to the Corps of Engineers to go and study this levy, 
study that dam, study this water retention facility. And they 
are proposing to make nearly a 45 percent cut. And in the 
Construction Account they propose a 35 percent cut. Well, what 
that means is, I will say it to the gentlewoman from Ohio, on 
the Great Lakes as we come to the opening of shipping season 
this end of March, early April on the Great Lakes, Lake 
Superior will be down ten inches because of drought over the 
last three years in the watershed of Lake Superior. The Great 
Lakes watershed is similarly in drought. Lower lakes will be 
down as much as seventeen inches. Lake Superior is equal to the 
volume of all the other four Great Lakes combined. So if its 
flow is down the flow in the other, the volume in the other 
lakes will be down substantially more. Harbors in the lower 
lakes are down as much as fifty-four inches. Our taconite 
ships, that is iron ore carrying vessels, in the seventies, 
eighties, and early nineties were going out with 73,000 tons 
are now going out 6500 tons light. That means, in the course of 
a season, two or three more voyages per vessel. That means 
higher cost to the steel mills, higher transportation costs. We 
need accelerate the dredging in the interconnecting channels in 
the Great Lakes and on the harbors in the lower lakes to 
accommodate those vessels that were built for twenty-seven foot 
draft and we do not have it now. The Corps has avoided the 
dredging costs on that Great Lakes over the last five years 
because we have had high water levels. Now we have to come back 
and do that dredging.
    So those are just a few of the highlights of what we need 
to do in this budget that is under your direction. I would be 
glad to respond to any questions you might have.
    [The prepared statement of Mr. Oberstar follows:]

   Prepared Statement of Hon. James L. Oberstar, a Representative in 
                  Congress From the State of Minnesota

    Thank you Chairman Spratt and Ranking Member Ryan for this 
opportunity to testify before you on the Fiscal Year 2008 budget 
resolution as it relates to programs within the jurisdiction of the 
Transportation and Infrastructure Committee.
    After reviewing the Administration's budget proposal, I have 
concluded that it contains serious shortcomings with regard to our 
nation's critical infrastructure needs, particularly in the areas of 
aviation, public transit, Amtrak, and wastewater treatment. In these 
important areas, the Administration's proposed budget is not a way 
forward, but a step backwards.
    Funding for the capital needs of the Federal Aviation 
Administration is still headed in the wrong direction. In 2003, the FAA 
requested and received from Congress an authorization of approximately 
$3 billion per year for its Facilities and Equipment program. Yet for 
the past three years the Administration has requested roughly $2.5 
billion per year for this program. For FY 2008, the Administration is 
once again requesting $2.46 billion to meet FAA's capital investment 
needs.
    The Department of Transportation Inspector General has stated that 
FAA cannot achieve its goal of technologically transforming the 
National Airspace System with a $2.5 billion (or less) capital budget, 
since a $2.5 billion funding level goes primarily toward sustaining the 
existing system, not new initiatives. The FAA's own preliminary Next 
Generation Air Transportation System cost estimate supports the IG's 
finding.
    I am concerned that by starving the FAA's capital programs, the 
Administration is slowly setting its Next Generation Air Transportation 
System effort--and ultimately the aviation system as a whole--up to 
fail.
    Similarly, the Administration is proposing a significant cut in 
funding for the Airport Improvement Program. The Administration's 
budget request provides $2.75 billion for the Airport Improvement 
Program (AIP) in FY 2008--$950 million less than the level authorized 
for FY 2007, and $765 million less than the House-passed FY 2007 
Continuing Resolution, H.J. Res. 20.
    The $2.75 billion proposed funding level would significantly reduce 
entitlement funds for virtually every airport currently receiving such 
funds. Small airports could be particularly hard hit by the proposed 
funding cut because AIP grants are a larger source of funding for 
smaller airports.
    Although we are just beginning the process of reauthorizing the 
FAA's programs for fiscal year 2008 and, therefore, do not have exact 
figures to recommend to you today, the fiscal year 2007 authorized 
levels provide a useful benchmark. To ensure that our aviation system 
remains safe, reliable, efficient, and able to accommodate the 
increased number of passengers anticipated in the near future, fiscal 
year 2008 funding for aviation capital programs should be no less than 
the fiscal year 2007 authorized levels of $3.7 billion for AIP and 
$3.11 billion for Facilities and Equipment.
    In the area of surface transportation, achieving full funding of 
the amounts guaranteed by the Safe, Accountable, Flexible, Efficient 
Transportation Equity Act: A Legacy for Users (SAFETEA-LU) has been, 
and will remain, one of the Committee's highest priorities. I am 
disappointed that the Administration has chosen not to honor the 
transit funding levels that it agreed to in negotiations on SAFETEA-LU 
less than two years ago. With congestion as the number one crisis 
facing our transportation system, the Administration's proposal to cut 
transit funding by more than $300 million below the level agreed to in 
SAFETEA-LU defies logic.
    Regarding Amtrak, the $800 million proposed by the Administration 
is a shut-down figure, and the fact that the budget proposes to have 
Amtrak develop a plan to sell-off portions of its business is 
tantamount to forcing Amtrak to bankrupt itself.
    Railroads throughout the world receive substantial government 
support to supplement the revenues paid by passengers. The U.S. has 
refused to do that, which is why we lag behind the rest of the world 
when it comes to passenger rail. According to the European Commission, 
in 2001 alone, France invested $6.5 billion in its rail system. Italy 
invested $6.8 billion. Denmark invested $9.5 billion. Even Great 
Britain invested $3 billion in its rail network in 2001.
    We need to stop nickel-and-diming Amtrak to death, and provide 
Amtrak with an adequate level of funding to address its needs. The 
Amtrak Board will be sending its fiscal year 2008 budget request to 
Congress shortly. In the meantime, it is safe to say that Amtrak will 
need at least the fiscal year 2007 funding level of $1.3 billion.
    The Administration's budget request for the Environmental 
Protection Agency also falls far short of what is needed.
    In 1972, only one-third of the nation's assessed waters met water 
quality goals. At present, two-thirds of those waters meet these goals. 
Although these achievements show incredible progress in the protection 
of our environment and public health, it is important to remember that 
one-third of the nation's waters still fail to meet these water quality 
goals that were first established more than 30 years ago. Without a 
strong commitment from both the Administration and the Congress to 
continued water quality protections, we run the risk of losing all the 
gains that we have made in recent decades.
    Despite a recognized need for increased federal investment to 
address an aging wastewater infrastructure, the Administration's budget 
request significantly undermines the federal commitment to the Clean 
Water State Revolving Fund. The budget requests $687.5 million in 
capitalization grants for State Clean Water programs--the lowest level 
requested by any administration since the creation of the program. This 
amount of funding is down from the likely fiscal year 2007 
appropriation of $1.084 billion and is close to a 50 percent cut from 
the long-term average of $1.35 billion for the program.
    Finally, under-funding of the Army Corps of Engineers has been a 
chronic problem that has resulted in an outdated and aging 
infrastructure. The Administration's budget significantly reduces the 
overall budget for the Corps' investigation and construction accounts 
(by 45 percent and 35 percent respectively) compared to the House-
passed fiscal year 2007 Continuing Resolution. The transportation 
benefits that could be achieved through greater investments in Corps 
navigation projects would help American products compete on the world 
market. Greater investments in flood control infrastructure today will 
reduce the risk that larger sums for disaster relief will be needed in 
the future.
    More comprehensive information on the Committee's recommendations 
will be provided once the Committee's Views and Estimates are formally 
adopted. These Views and Estimates will demonstrate that we are 
significantly under-funding many of our transportation and 
infrastructure investments. This underinvestment puts our economy, 
global competitiveness, and quality of life at risk.
    I urge your support for the Transportation and Infrastructure 
Committee's recommendations as you develop the FY 2008 budget 
resolution.

    Mr. Etheridge. I thank the gentleman for his testimony and 
his full written statement. Does any member have questions?
    Ms. Kaptur. Mr. Chairman, I just wanted to thank the 
distinguished Chairman of the Transportation and Infrastructure 
Committee for coming before us today. And I have said to many 
audiences we could not have a better American in place today 
for what we face in terms of these investments than yourself. 
You are so ready for this. I am just happy. I am just happy you 
are in place. And I can tell you as a member of the 
Appropriations Subcommittee on Transportation and Housing, we 
look forward to your recommendations. And as a designee to this 
Committee from the Appropriations Committee, to try to do the 
best that we can in view of the war costs that we are amassing, 
and straining all of the other accounts. So, Chairman Oberstar, 
you will be highly regarded in terms of your recommendations 
and we thank you very much for coming today.
    Mr. Oberstar. Thank you.
    Mr. Etheridge. I thank the gentle lady, and we thank the 
gentleman from Minnesota for all his hard work and his great 
leadership. Thank you.
    Mr. Oberstar. Thank you, Mr. Chairman.
    Mr. Etheridge. Thank you, sir. The next member to testify 
is the gentleman from California, Mr. Honda. Welcome. And we 
are pleased to receive your testimony, Mr. Honda, and you are 
now recognized for ten minutes.

    STATEMENT OF HON. MICHAEL M. HONDA, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Honda. Thank you, Mr. Chairman, and it is a pleasure to 
be back in the room that I spent two years in. Mr. Chairman, 
thank you for this opportunity to express the budget priorities 
for my Silicon Valley district. As a former member of this 
distinguished Committee it is a great pleasure to speak before 
you.
    I would like to spend a few minutes today to discuss the 
important priorities on education that you know very well, 
justice, healthcare, and innovation and competitiveness which 
is a hallmark of Silicon Valley.
    Mr. Chairman, as a former teacher and principal promoting 
quality education continues to be a top priority for me. I 
supported the No Child Left Behind with great trepidation. 
While I support setting higher standards for our nation's 
schools, I feared that without the necessary resources the 
legislation would impose unfunded mandates on our schools, our 
teachers and our students and unfortunately that fear has 
become a reality. And today I hear from countless educators who 
are struggling with the mandates set out by NCLB while facing 
severe budgetary cuts. In Santa Clara County there are teachers 
who have been given one box of paper for their students for the 
entire year, and there are teachers who do not have access to 
even copy machines anymore because the schools have shut them 
down. So we must increase our investment in education to fund 
vital programs and services.
    For the last four budget cycles we have seen very little 
increase in education spending. The President's budget proposes 
$1.5 billion below the fiscal year 2007 request for the 
Department of Education. Yet the demands on our students and 
schools have increased due to the increased costs of providing 
services and the difficulty of meeting the requirements of 
NCLB. The President's budget request for fiscal year 2008 
eliminates forty-four education programs and makes drastic cuts 
to others. The rationale for eliminating many of these programs 
is that they are ``ineffective.'' But the programs never 
received the funding necessary to allow them to succeed.
    Four of these programs are designed to specifically target 
and assist some of our neediest students, Hawaiian and Alaskan 
natives. Other cuts include education and education technology. 
The reauthorization of Elementary and Secondary Education Act, 
the so-called No Child Left Behind Act, has already left many 
students behind. We have a long ways to go to fix this law to 
give schools the help they need.
    If nothing else, the data from No Child Left Behind has 
clearly demonstrated that America's education system is 
fundamentally inequitable. We have set high standards for 
students but we have not matched those goals with the resources 
they need. The achievement gap remains and the funding gap 
remains also. Without increased funding, we will not be able to 
provide the teacher training, instructional services, and 
materials that schools need to improve student learning.
    Significantly, the President's budget fails to fully fund 
the Individuals with Disabilities Education Act, or IDEA. In 
1975 the federal government made a commitment to provide 40 
percent of the cost of educating children with disabilities. 
Congress has failed to meet these commitments for over twenty-
eight years. This is simply, as you understand, simply 
unacceptable. Federal programs such as IDEA, Title I, and Pell 
Grants exist to level the playing field for disadvantaged 
students. But we have failed to provide the funding to allow 
them to have their full effect. Public education should be the 
great equalizer, providing the opportunity for a better life 
for all Americans.
    Today I urge the Committee to make education a top priority 
by fully funding IDEA and increasing funding for the No Child 
Left Behind Act. Just a sidebar, the State Superintendent of 
Education for the State of California, Mr. O'Connell, has asked 
that in your wisdom that when the bill comes through that there 
will be flexibility allowed by each state so that they can have 
the flexibility and the ability to adjust the evaluation 
criteria.
    Mr. Chairman I am also here today to oppose the President's 
attempt once again to eliminate the State Criminal Alien 
Assistance Program in this budget. SCAAP reimburses state and 
local governments for the cost of incarcerating criminal aliens 
and is vital to border states such as California which 
incarcerate a disproportionate high share of undocumented 
criminal aliens. Securing our nation's border is the exclusive 
jurisdiction of the federal government. Congress has 
consistently legislated that the federal government must either 
take criminal aliens into federal custody or reach an agreement 
to compensate state and local jurisdictions for their 
incarceration. The President's budget request, which provides 
no funding for SCAAP, would abandon state and local 
jurisdictions and devastate my home state of California, which 
receives 40 percent of SCAAP funding.
    In addition, the President's budget would eliminate several 
crucial programs that will affect the health and well-being of 
my constituents as well as our nation. The President proposes 
to eliminate the Urban Indian Health Program, which provides 
unique services for those Native Americans living outside of 
reservations as a result of federal relocation policies and the 
unfortunate socio-economic realities that persist on 
reservations. The President claims that urban Native Americans 
can access healthcare services through other providers, but 
UIHP participants offer needed holistic care as well as 
culturally and linguistically competent care, including 
diabetes treatment and cultural activities. They estimate they 
will lose ten staff members and that about 1550 clients will be 
terminated from the services under the President's budget and 
this is not acceptable.
    The President's budget also nearly completely cuts funding 
for Title VII Health Professions Programs, proposing just $9.7 
million, a 94.7 percent cut from 2007. These programs aim to 
increase the diversity of our healthcare workforce, as well as 
improve the quality of healthcare in low income and racial and 
ethnic minority populations. The Centers of Excellence Program 
enables Health and Professionals Training Programs to enlarge 
their applicant pools, enhance the academic performance of 
under represented minority students, improve the recruitment 
and retention of under represented minority faculty, and in 
other ways enhance the capacity of their graduates to provide 
healthcare services to people who are medically under served. 
In 2005 there was only one Center of Excellence dedicated to 
studying the unique needs of the Asian Pacific Islander 
community. As a result of a 67 percent cut to the Centers of 
Excellence Program in 2006, that one center lost its funding. 
Other Centers of Excellence for Latinos, Native Americans and 
African Americans also lost their funding. The President's 
budget not only continues to radically underfund the Centers 
Program, but makes drastic cuts to Title VII as a whole.
    I am also troubled by the President's proposal to eliminate 
other programs that serve our most frail and vulnerable 
populations, such as the Community Service Block Grants and 
Preventative Health and Health Services Block Grants. In 2005 
California received nearly $56.5 million in CSBG funding and 
used it to serve almost half of the state's residents 
identified as low income.
    Now, I am encouraged by some aspects of the President's 
budget request. He proposes an increase in funding for 
expansion of treatment capacity for drug courts, which have 
been chronically underfunded in his prior requests and by the 
Congress. Drug courts are an effective and popular method for 
the judicial system, mental health and social service, and 
treatment communities to intervene and break the cycle of 
substance abuse, addiction and crime. The President's budget 
requests $31.8 million for this program, a $21.7 million 
increase over the funding level for 2007. I am also glad to see 
that the President has included some important funding 
increases for scientific research that will help our nation 
maintain its competitive position in the global marketplace. 
Unfortunately, he has once again chosen to rob Peter to pay 
Paul by proposing to eliminate programs that have a proven 
track record of aiding small businesses and creating new jobs, 
the Manufacturing Extension Partnership and the Advanced 
Technology Program. And he has not provided the funding NASA 
will need to achieve the Challenge in Exploration goals he has 
set for the agency while performing its core science and 
aeronautics activities.
    I understand that the Budget Committee is being asked to 
make these funding decisions in the context of a deficit 
environment. However, the federal government has an obligation 
to invest in future growth. Our nation's historical commitment 
to education, healthcare, and innovation and competitiveness 
has served us well and we must reaffirm that commitment in the 
2008 budget resolution.
    And I would respectfully ask that the Committee fully fund 
IDEA and provide substantial increases for the No Child Left 
Behind Act, allocate sufficient funding for vital health 
programs, and ensure that we can maintain our international 
competitiveness in science and innovation. And I yield back the 
remainder of my time and I appreciate the Committee's 
indulgence in allowing me to put on record that which is 
important not only Silicon Valley but also this nation.
    Mr. Etheridge. I thank the gentleman for his testimony and 
for his commitment in making sure that his message is placed on 
the record for his people. Thank you, sir.
    Mr. Honda. Thank you, Mr. Chairman.
    [The prepared statement of Mr. Honda follows:]

   Prepared Statement of Hon. Michael M. Honda, a Representative in 
                 Congress From the State of California

    Chairman Spratt, Ranking Member Ryan, and Members of the House 
Budget Committee, thank you for this opportunity to express the budget 
priorities for my Silicon Valley district. As a former Member of this 
distinguished committee, it is a great pleasure to speak before you.
    Mr. Chairman, as a former teacher and principal, promoting quality 
education continues to be a top priority for me. I supported the No 
Child Left Behind Act with great trepidation. While I support setting 
higher standards for our nation's schools, I feared that without the 
necessary resources, the legislation would impose unfunded mandates on 
our schools, our teachers, and our students. Unfortunately, that fear 
has become a reality.
    Today, I hear from countless educators who are struggling with the 
mandates set out by the No Child Left Behind Act while facing severe 
budgetary cuts. In Santa Clara County, there are teachers who have only 
been given one box of paper for their students for the entire year. 
There are teachers who do not have access to copy machines anymore 
because the schools have shut them down.
    We must increase our investment in education to fund vital programs 
and services. For the last 4 budget cycles, we have seen very little 
increase in education spending. The President's budget proposes $1.5 
billion below the Fiscal Year 2007 request level for the Department of 
Education. Yet the demands on our students and schools have increased, 
due to the increased cost of providing services, and the difficulty of 
meeting the requirements of No Child Left Behind.
    The President's budget request for Fiscal Year 2008 eliminates 44 
education programs, and makes drastic cuts to others. The rationale for 
eliminating many of these programs is that they are ``ineffective,'' 
but the programs never received the funding necessary to allow them to 
succeed. Four of these programs are designed to specifically target and 
assist some of our neediest students, Hawaiian and Alaska Natives. 
Other cuts include family literacy, physical education, and education 
technology.
    If nothing else, the data from No Child Left Behind has clearly 
demonstrated that America's education system is fundamentally 
inequitable. We have set high standards for students, but we have not 
matched these goals with the resources they need. The achievement gap 
remains, and the funding gap remains. Without increased funding, we 
will not be able to provide the teacher training, instructional 
services, and materials that schools need to improve student learning.
    Significantly, the President's budget once again fails to fully 
fund the Individuals with Disabilities Education Act, or IDEA. In 1975, 
the Federal government made a commitment to provide 40% of the cost of 
educating children with disabilities. Congress has failed to meet that 
commitment for over 28 years. This is simply unacceptable.
    Federal programs such as IDEA, Title I, and Pell Grants exist to 
level the playing field for disadvantaged students, but we have failed 
to provide the funding to allow them to have their full effect. Public 
education should be the great equalizer, providing the opportunity for 
a better life for all Americans. Today, I urge the committee to make 
education a top priority by fully funding IDEA and increasing funding 
for the No Child Left Behind Act.
    Mr. Chairman, I am also here today to oppose the President's 
attempt, once again, to eliminate the State Criminal Alien Assistance 
Program in this budget. SCAAP reimburses state and local governments 
for the costs of incarcerating criminal aliens, and is vital to border 
states such as California which incarcerate a disproportionately high 
share of undocumented criminal aliens.
    Securing our nation's borders is the exclusive jurisdiction of the 
federal government. Congress has consistently legislated that the 
federal government must either take criminal aliens into federal 
custody or reach and agreement to compensate state and local 
jurisdictions for their incarceration. The President's budget request, 
which provides no funding for SCAAP, would abandon states and local 
jurisdictions and devastate my home state of California, which receives 
40 percent of SCAAP funding.
    In addition, the President's budget would eliminate several crucial 
programs that will affect the health and well being of my constituents, 
as well as our nation. He proposes to eliminate the Urban Indian Health 
Program, which provides unique services for those Native Americans 
living outside of reservations as a result of federal relocation 
policies and the unfortunate socio-economic realities that persist on 
reservations. The President claims that urban Native Americans can 
access health care services through other providers, but UIHP 
participants offer needed holistic care, as well as culturally and 
linguistically competent care unavailable through other providers.
    In my district, the San Jose Indian Health Center will face 
significant decreases in medical and dental services, case management, 
substance abuse treatment, diabetes treatment, and cultural activities. 
They estimate they will lose 10 staff members and that about 1,550 
clients will be terminated from services under the President's budget.
    The President's budget also nearly completely cuts funding for the 
Title VII Health Professions Programs, proposing just $9.7 million, an 
94.7 percent cut from FY 2007. These programs aim to increase the 
diversity of our healthcare workforce as well as improve the quality of 
health care in low-income and racial and ethnic minority populations. 
The Centers of Excellence program enables health professions training 
programs to enlarge their applicant pools, enhance the academic 
performance of under-represented minority students, improve the 
recruitment and retention of under-represented minority faculty, and in 
other ways enhance the capacity of their graduates to provide health 
care services to people who are medically underserved.
    In 2005 there was only one Center of Excellence dedicated to 
studying the unique needs of the AAPI community. As a result of a 67% 
cut to the Centers of Excellence program in FY 2006, that one center 
lost its funding. Other Centers of Excellence for Latinos, Native 
Americans, and African-Americans also lost their funding. The 
President's budget not only continues to radically underfund the 
Centers program, but makes dramatic cuts to Title VII as a whole.
    I am also troubled by the President's proposal to eliminate other 
programs that serve our most frail and vulnerable populations, such as 
the Community Services Block Grants and Preventative Health and Health 
Services Block Grants. In 2005, California received nearly $56.5 
million in CSBG funding and used it to serve almost half of the state's 
residents identified as low-income.
    I am encouraged by some aspects of the President's budget request. 
He proposes an increase in funding for drug courts, which have been 
chronically underfunded in his prior requests and by the Congress. Drug 
courts are an effective and popular method for the judicial system, 
mental health, social service, and treatment communities to intervene 
and break the cycle of substance abuse, addiction, and crime. The 
President's Budget requests $31.8 million for this program, a $21.7 M 
increase over the funding level for FY 2007. While the drug courts 
program would benefit from even greater funding of $40 million, I am 
pleased to see the increased budget request for this important program.
    I am also glad to see that the President has included some 
important funding increases for scientific research that will help our 
nation to maintain its competitive position in the global marketplace. 
Unfortunately, he has once again chosen to ``rob Peter to pay Paul'' by 
proposing to eliminate programs that have a proven track record of 
aiding small businesses and creating new jobs, the Manufacturing 
Extension Partnership and the Advanced Technology Program, and he has 
not provided the funding NASA will need to achieve the challenging 
exploration goals he has set for the agency while still performing its 
core science and aeronautics activities.
    I understand that the Budget Committee is being asked to make these 
funding decisions in the context of a deficit environment. However, the 
federal government has an obligation to invest in future growth. Our 
nation's historical commitment to education, health care, and 
innovation and competitiveness has served us well, and we must reaffirm 
that commitment in the FY 2008 budget resolution. I respectfully ask 
the committee to fully fund IDEA and provide substantial increases for 
the No Child Left Behind Act, allocate sufficient funding for vital 
health programs, and ensure that we can maintain our international 
competitiveness in science and innovation.
    Thank you.

    Mr. Etheridge. Without objection, I would ask that my 
statement be entered into the record at this point.
    [The prepared statement of Mr. Etheridge follows:]

Prepared Statement of Hon. Bob Etheridge, a Representative in Congress 
                    From the State of North Carolina

    Thank you, Chairman Spratt, for the opportunity to address the U.S. 
House Budget Committee about the budget for the federal government of 
the United States. I commend you for your leadership on this vitally 
important issue, and I look forward to serving with you on the Budget 
Committee.
    I sought appointment to this committee assignment because with 
Democrats in the new Majority, I understand how important the job of 
this committee is to draw up a budget that is consistent with America's 
priorities. After a career in business, service as a county 
commissioner and chairman, ten years in the state legislature, 
including four as chairman of the appropriations committee, eight years 
as the elected schools superintendent for the nation's tenth largest 
state, and ten years in the minority of this body, I bring a unique 
perspective to the table.
    In my first few weeks on this committee, I have already learned 
some important lessons. The first lesson I learned was this: there 
isn't any money. None. The former Majority blew up the budget and then 
blew town. Chairman Obey did the best he could in cobbling together an 
appropriations continuing resolution to get us through the year, but 
we've all had to go through the painful process of informing our 
constituents that they cannot expect a lot of federal largess any time 
soon.
    Unfortunately, the President chose to continue the political 
gamesmanship when submitting the Administration's budget proposal 
earlier this month. The Administration had the temerity to claim that 
the budget proposal would reach balance by 2012 while maintaining the 
President's tax cuts. Let me be perfectly clear: that claim is untrue. 
It is a falsehood. It is a lie. I usually avoid using such strong 
language, but this widespread claim is so outlandish, it must be 
thoroughly discredited.
    The President's budget assumes that beyond the first year, all the 
revenues currently projected to be collected from the Alternative 
Minimum Tax will still go into the U.S. Treasury. That would amount to 
a massive tax increase on middle class American families in the range 
of $800 billion to $1.2 trillion over ten years. The vast majority of 
Americans have never heard of the Alternative Minimum Tax, or AMT, and 
I am very disappointed that the President failed to exert the 
leadership necessary to educate our citizens and lay the predicate for 
cooperative solutions to his huge challenge. In testimony before this 
committee, U.S. Treasury Secretary Paulson admitted the Administration 
has no plan to fill this gaping hole in the budget. It is fuzzy math at 
its worst and a continuation of the political gamesmanship that has 
characterized this White House. In fact, when Budget Director Rob 
Portman appeared before this committee earlier this month, he taunted 
Chairman Spratt with the challenge to ``pull a rabbit out of your hat'' 
in crafting a budget of our own. Such political gamesmanship must end.
    I am concerned that the Administration's budget proposal assumes an 
unrealistic level of incoming revenues to the extent that it really is 
the rosy scenario. I would like to think that economic growth will 
remain robust and tax receipts would continue to pour in, but even as 
we hope for the best, it is our responsibility to plan for the worst. 
Any carpenter can tell you it's best to fix the roof while the sun's 
still shining.
    Not only does this budget proposal not fix the fundamental 
imbalance in the federal books, it makes drastic cuts to important 
domestic priorities like Medicare and Medicaid, children's health, 
veterans, first responders, education and the environment. As a former 
North Carolina small businessman, I learned long ago to be tight with a 
buck, and I have always worked to be a watchful steward of the 
taxpayers' money. But I strongly believe we will cease to be a great 
country if we continue to neglect the many unmet needs our citizens 
have for critical services only the federal government can provide. For 
example, the budget request cuts education funding by $1.5 Billion and 
eliminates 44 education initiatives entirely. A society that cuts 
education is like a farmer who eats his seed corn; neither one is going 
to have much of a future. I strongly believe we must invest in the 
future, and I will work to reverse these misguided budget cuts.
    Finally, I am very concerned about the record national debt and the 
interest that must be paid to service that debt. In fact, interest is 
the fastest growing segment of the federal budget. Nearly all the new 
debt is held by foreign creditors, and many of them in regimes such as 
China, Japan, Saudi Arabia and Libya. When I asked Secretary Paulson 
about this problem, he responded by stating that it is not near the top 
of the things that worry him. Let me state that it is near the top of 
the list of things that worry me, and I think it should be near the top 
of the list of the things that this committee and this Congress aim to 
tackle. Anyone who has ever gotten behind on a credit card account 
knows that paying interest gets you nothing. It is time for this 
Congress to reverse the budget priorities of the federal government, 
pay off the national debt and lift that burden from our children and 
grandchildren.
    In conclusion, it will take bipartisan cooperation and leadership 
to reverse the reckless policies that have gotten us into this mess. I 
am willing to get to work to help provide that leadership, and I am 
hopeful we can obtain bipartisan cooperation in doing so. The American 
people deserve no less.

    Mr. Etheridge. Thank you. The gentleman from Minnesota is 
recognized. Mr. Walz, welcome and we are pleased to receive 
your testimony. You are recognized for ten minutes.

STATEMENT OF HON. TIMOTHY J. WALZ, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF MINNESOTA

    Mr. Walz. Well thank you so much, Mr. Chairman. I truly 
appreciate the opportunity to come here and speak to you. And 
even in absentee, a thank you to all the members of this 
Committee. I know that this may be one of the most thankless 
but the most important job that is being done this year and 
your work is truly appreciate by all of us. And I say that, not 
just members but my constituents.
    I am here today, Mr. Chairman, to talk to you about this 
budget as it affects our veterans. And I do not think in the 
environment that we are in right now, in the discussion that we 
are having on the floor of the House of Representatives 
anything could be more important. I come to you, Mr. Chairman, 
to discuss these as a twenty-four year veterans of the Army 
National Guard and the son of a Korean War era veteran.
    Last week the President's proposal showed some promise but 
in many cases fell far short of the expectations that we need 
to fill. During his 2002 State of the Union the President spoke 
of the need to care for our nation's veterans, and he asked for 
a statement that had me heartened at the time, to approve a 
historic increase in spending for veterans healthcare. 
Unfortunately, over the last five years we have seen just the 
opposite. Without taking you through all the details and using 
your precious time, Mr. Chairman, I would just pass along to 
you a couple of things that I think are critical for me.
    In looking at the independent budget created by veterans 
for veterans, there are some critical issues being addressed. 
And one of the things that the President's budget does is in 
trying to make the budget balance they give us a choice of 
cutting off access of services to our veterans, especially of 
previous wars, in the name of balancing the budget, at the same 
time underestimating the need of our veterans that are 
returning. We as a nation have an obligation to make sure that 
we are honest with the public, honest with our veterans. If the 
need is there, the need needs to be fulfilled.
    And I spent the afternoon with some of my soldiers from my 
old unit, the 34th Division out at Walter Reed this afternoon. 
And both of these soldiers lost limbs in this War in Iraq. 
These are good soldiers. They believe in their mission and they 
are doing everything they can to accomplish what they have been 
sent to Iraq to do. But one of the interesting things was, is 
one of these young men is still in the process of preparing to 
get his prosthetics fit and another one has had his prosthetics 
fit. When we look at the President's budget we see that the 
money spent for, or allocated for, prosthetic limb research has 
been cut in half. And I would challenge and ask Mr. Chairman, 
and I do not know if it is possible, for each of the members of 
this Committee to get out there and get a chance to talk to 
these young men. To talk to Tony Larson and ask him, and tell 
him what a quality of life issue it is. His prosthetic leg, he 
calls it the cheetah foot, is bouncer on and he has taken up 
running now. And this is a brand new thing that is happening 
and it is coming from the research dollars that this Congress 
puts into that. So I would encourage that, for people to think 
about the impact that these make.
    Fulfilling the budget request as the President would have 
us will leave us far short, Mr. Chairman. We have got an 
opportunity, we understand that there are tight budget 
restraints, but we have an opportunity to do right by these 
people. I ask for you to consider the testimony that is coming 
in from the veterans group. I ask for you and the rest of the 
group to look closely at this, and I ask for us to keep our 
commitments to our veterans and to ensure that future 
generations know that that commitment will be there. So I would 
entertain any questions, Mr. Chairman. If not, I'll give back 
the balance of my time.
    Mr. Etheridge. I thank the gentleman, and without objection 
your full statement will be entered into the record.
    [The prepared statement of Mr. Walz follows:]

    Prepared Statement of Hon. Timothy J. Walz, a Representative in 
                  Congress From the State of Minnesota

    Chairman Spratt, Ranking Member Ryan, and members of the committee, 
thank you for the opportunity to testify on some of the budgetary 
matters facing America's veterans today. Your willingness to hear 
testimony from me, as well as so many of my colleagues and other 
concerned citizens demonstrates your strong commitment to writing a 
fiscally sound budget that fulfills the needs of our veterans. I hope 
that my testimony today can aid you in your work.
    Mr. Chairman, I am here today to discuss veterans' priorities 
within this budget from my perspective as a 24 year veteran of the Army 
National Guard and the son of a Korean War veteran. Last week, the 
President released his FY2008 budget request for the Department of 
Veterans Affairs, and while I am pleased to see at least slight 
increases in some important areas, the majority of his budget request 
leaves me deeply concerned. During his 2002 State of the Union speech, 
this President spoke of the need to care for our nation's veterans. He 
went so far as to ask Congress to ``approve an historic increase in 
spending for veterans' health.''
    Since then, Mr. Chairman, the President has not followed through on 
his promises to America's veterans. In fact, President Bush has not 
mentioned veterans' issues in his last four State of the Union 
addresses. And in 2005, only a few short years after his 2002 promise 
to fund an historic increase in veterans' health care, the Department 
of Veterans Affairs was left so dangerously underfunded that Congress 
had to appropriate an emergency fund of $1 billion to keep the doors of 
our VA clinics and hospitals open.
    This year, in his FY2008 budget request, the President has again 
placed veterans far too low on his list of priorities, underfunding VA 
medical care by $3.5 billion over five years. The President has 
requested a 6 percent increase in funding for VA medical care which is 
wholly inadequate. While certainly an improvement over his .4 percent 
increase request in FY2006, the FY2008 request does not meet the needs 
of a rapidly growing number of new veterans needing VA medical care, 
coupled with rapidly escalating health care costs. As a practical 
matter, that means that the VA will not be able to provide the care 
that our nation's former servicemen and women are entitled to. You 
don't have to take my word for it: this request is a full 6.7 percent 
below the recommendation of the Independent Budget, a report put out by 
a group of veterans' service organizations.
    Mr. Chairman, you don't need me to read you the statistics. What I 
need to express to this committee is the human impact of these 
budgetary decisions. It is not acceptable for us to exclude entire 
classes of veterans from the VA system. The men and women we call 
Priority 8 veterans served this country in the same ways other veterans 
did. The lack of a combat injury is no excuse for excluding them from 
the health care system they were promised access to. Barring 1.6 
million veterans from their own health care system is unfair and 
unacceptable.
    Mr. Chairman, the President's budget request proposes increased co-
payments on prescription drugs and new enrollment fees for priority 7 
and 8 veterans. These fees will drive out the veterans who need the 
system most, adding to the 47 million Americans who now lack health 
insurance.
    If fees don't drive our veterans out, access to care just might. In 
my district, there are less than a half dozen primary care veterans 
clinics in operation. Mr. Chairman, my district is 300 miles wide--it 
stretches from the border of South Dakota to the border of Wisconsin. 
Veterans from my district who need more than a regular physical must 
charter vans through their Veterans Service Officers in order to make 
the drive to the VA Hospital in Minneapolis. A three hour ride is an 
excessive hardship, only made worse by the fact that this President is 
asking our veterans to pay more for those services when they finally 
arrive at the hospital. We can do better.
    Mr. Chairman, the President's FY2008 budget request for the 
Department of Veterans Affairs represents the wrong priorities for our 
nation's veterans. However, the responsibility to do right by veterans 
does not lie with the President alone. We, the United States Congress, 
have the solemn responsibility and duty to create a budget that 
fulfills the promises we made to those who served.
    We are responsible for caring for those who gave of themselves in 
years past and to care for those who are returning from Iraq and 
Afghanistan in the future. The President's budget asks for only minimal 
increases in mental health services for Iraqi veterans despite recent 
studies that show 1 in 6 soldiers in Iraq report symptoms of 
depression, serious anxiety, or post-traumatic stress disorder. At a 
time when the VA expects to treat 5.8 million patients, including 
263,000 veterans from Iraq and Afghanistan in the coming year, it is 
Congress' duty to increase funding for the Department of Veterans 
Affairs and specifically to increase funding for both research into and 
treatment of the mental health conditions that plague many of our 
veterans.
    At a time when Harvard University and the American Customer 
Satisfaction Index are recognizing the VA for its quality medical care, 
it is Congress' duty to ensure the VA does not veer from this upward 
trend and that it continues to improve not only quality of care but 
access to care.
    At a time when our VA system is straining under the weight of both 
an aging veterans population and an entirely new group of veterans 
returning from the War on Terrorism, we must ensure funding matches not 
just monetary inflation but also the inflation in the number of 
veterans eligible for service.
    Mr. Chairman, I am here today to ask you to help fulfill this duty 
by increasing the President's request for veterans' programs. The 
President's $86.75 billion request is simply not enough. As a veteran 
and the descendent of a long line of men who served this country, I can 
say with authority that properly funding our VA system does more than 
just provide veterans with the health care they were promised. Properly 
funding our VA ensures a new generation of soldiers will enlist and it 
helps to keep our communities both physically and economically healthy.
    Thank you.

    Mr. Etheridge. Let me thank you. I visited both Walter Reed 
and Bethesda. And a number of my friends from my district are 
there. I happen to represent Fort Bragg and Pope, and so a lot 
of young men and women from that area have been there and they 
wind up here. But let me thank you for your commitment, for 
keeping the focus as it should on the men and women who are on 
the front line and their families who are coming back now. And 
they are going to need care, not just when they get back, for 
years to come. We thank you for your testimony, your time, and 
your commitment.
    Mr. Walz. Thank you, Mr. Chairman.
    Mr. Etheridge. Thank you. The next member to testify is the 
gentleman from Indiana, Representative Brad Ellsworth. Welcome, 
we are pleased to receive your testimony. And you are now 
recognized for ten minutes.

STATEMENT OF HON. BRAD ELLSWORTH, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF INDIANA

    Mr. Ellsworth. Thank you, Mr. Chairman, for allowing me 
this opportunity to address the Committee on issues that are of 
special interest to me and the voters of Indiana's eighth 
district.
    My career in law enforcement, my time listening to 
constituents back home, and my limited experience in Congress 
so far have given me some unique insights into the importance 
of promoting our nation's priorities while maintaining our 
dedication to fiscal responsibility.
    Mr. Etheridge. Excuse me, let me interrupt just a minute. 
Without objection, your full statement will be entered into the 
record.
    Mr. Ellsworth. Thank you, Mr. Chairman. To continue, during 
my twenty-four year career as a law enforcement officer with 
the local sheriff's office, I saw first hand the bravery and 
sacrifice of our community's police officers and firefighters. 
Even before the terrorist attack became a concern, these public 
servants had their hands full keeping the peace and protecting 
America's families at the local level. Our law enforcement 
deals with domestic violence, theft, suicide threats, drug 
crimes, and a host of other challenges as they step into their 
patrol cars each and every day. The efforts of these men and 
women allow the rest of us to feel secure in our cities, our 
neighborhoods, and in our homes.
    In the early 1990's the federal government provided local 
law enforcement with the ability to fulfill their duties in the 
midst of growing crime rates and drug use. The COPS Program 
lowered the cost to local governments of hiring new officers 
and put more than 120,000 additional policemen on the streets. 
This year, the President's budget contains a funding cut for 
the COPS Program from $558 million in fiscal year 2007 to $32 
million in fiscal year 2008. This would amount to a 94 percent 
in the program in a single year.
    There is no doubt communities across the nation will suffer 
from such cuts. Fewer cops on the streets result in more crime 
and more insecurity for American communities. After 9/11 it 
became quite clear that the foreign terrorists had the ability 
to attack us on our own soil, not only on the coast but also in 
the heartland. Overnight, our nation's community police and 
firefighters, our first responders, and were suddenly thrust 
into the battle lines in this War on Terror. Now I can attest 
that these brave men and women did not expect this latest 
responsibility, but they proudly accepted it.
    As these new challenges strained an already overwhelmed 
local budget, the federal government stepped up to help the 
municipalities and these agencies face this new threat. Federal 
programs provided grants, training, and other assistance to the 
community agencies charged with responding in these local 
terrorist attacks. Without such programs, local officials would 
be unable to confront this new threat.
    Once again, the President's budget proposal, the massive 
cuts in funding to homeland security initiatives target the 
equipping of America's first responders. Law Enforcement 
Terrorism Prevention Grants, cut by 30 percent. Firefighter 
Assistance Grants, cut by 55 percent. State Homeland Security 
Grants, cut 64 percent. Federal assistance to community 
policing and security has already been cut in half in the last 
decade. This 42 percent cut in overall Homeland Security 
assistance combined with the virtual elimination of the COPS 
Program would hinder the ability of the American community 
police officers and firefighters to respond daily to the 
catastrophic emergencies that hit us every once in a while.
    The President of the International Association of 
Firefighters may have put it best, and I quote, ``Make no 
mistake, this budget proposal puts the safety and security of 
the American people at risk.'' In our efforts toward a common 
goal of a balanced budget we must not forget our duty to 
protect America's communities. It is a priority and our budget 
must reflect its importance.
    Constituents throughout the eighteen counties in my 
district share another common concern, the skyrocketing cost of 
healthcare in America. The cost of healthcare is forcing the 
elderly to choose between groceries and prescription drugs that 
they need to survive. It is squeezing the bottom lines from 
Hoosier small businesses. It is depriving many of our children 
the opportunity to fulfill their potentials in the classroom. 
Of course, it is no secret to Hoosiers that the federal 
government is not here to solve every one of our problems and 
they do not expect us to. But they do understand that 
government has a responsibility to help the neediest among us, 
those who cannot help themselves.
    Few programs have been as successful in providing for those 
in need more than States Children's Health Insurance Program, 
referred to SCHIP. When a Democratic president and a Republican 
Congress came together in 1997 to write SCHIP into law they 
were united with one purpose: to provide access to healthcare 
to those children who had fallen through the cracks. Their 
parents had jobs, but like many Americans they did not get 
health insurance while they worked. They made just enough to 
disqualify from the Medicaid Program and not enough for them to 
purchase private insurance. Ten years later, over six million 
children across this country have access to quality healthcare 
through the SCHIP Program. These children enjoy a level playing 
field at school and have a better chance to succeed.
    Yet despite the successes of this program we are still 
faced with many challenges. In my state alone, 161,000 are 
without health insurance. Nationwide, the number is closer to 
nine million. And while these numbers increase, the President's 
budget proposed to shrink SCHIP. In fact, the President's 
request to Congress underfunds SCHIP by about $10 billion as it 
reauthorizes the program this year. His proposal would plunge 
many of these children back into the ranks of the uninsured.
    Fiscal responsibility, a balanced budget in particular, is 
a goal that we share on both sides of the aisle. But we can all 
agree that our nation's budget should illustrate our nation's 
values and priorities. As we consider our options and make the 
difficult choices that lead to fiscal responsibility, we need 
to address one of the most unnecessary obstacles to reaching a 
balanced budget: taxpayer dollars lost to waste, fraud, and 
abuse.
    There are too many instances to list in such a short time, 
but I have been here long enough to see the instructive 
examples. In my seat on the House Armed Services Committee I 
have seen multiple reports already of waste and abuse that are 
robbing our troops in Iraq of the support of Congress and 
provided them in previous budgets. A recent Defense Department 
Inspector General's report showed that 15 percent of the 
American taxpayer dollars devoted to Iraq reconstruction 
projects, nearly $3 billion, has been wasted. That same report 
indicated that the State Department may have spent over $36 
million on weapons and equipment that cannot be accounted for. 
Another audit discovered that 14,000 weapons supplied to Iraqi 
security forces have now shown up missing. Not only do errors 
like this waste taxpayer dollars meant to be for U.S. troops in 
harm's way, they may further endanger our fighting men and 
women by arming violent militias.
    The funds and weapons unaccounted for in Iraq are not the 
only examples of waste and fraud that I have seen. In my seat 
on the Small Business Committee I have heard the numerous 
budget problems faced by government agencies, such as the Small 
Business Administration where resources are so scarce that 
oversight is halted altogether, opening the door for fraud and 
abuse. This past weekend, a local nightly news report from 
Houston, Texas illustrated the waste that results from improper 
oversight. After the 9/11 attacks by terrorists the federal 
government authorized the Small Business Administration to 
provide loans to small businesses suffering an economic toll 
from the attacks in New York and Washington, D.C. This news 
report found nearly $100 million in 9/11 loans had been awarded 
in the Houston area, businesses such as a car wash, a dry 
cleaner, a preschool, and a yogurt shop.
    To prevent such waste, fraud and abuse Congress and the 
President must work together. It is unacceptable for billions 
of taxpayer dollars to be thrown away due to improper 
accounting and scant oversight. As we work together to balance 
our nation's budget, our priority must be reducing waste. Not 
only will efforts stem the tide of waste and move us closer to 
our goal of balancing the budget, but they will also 
demonstrate to the American people that their elected 
representatives are spending their money wisely.
    In closing, Mr. Chairman, the people back home in Indiana 
sent me here and expect us to work together every day to 
achieve a balanced budget that reflects our values and our 
priorities. Fiscal responsibility is not a Democratic goal, it 
is not a Republican goal, it is what our constituents expect of 
both parties. As their representatives it is our responsibility 
to put in the long hours, make the tough decisions, and get our 
country back on the right track.
    I would like to thank you, Mr. Chairman, for your time and 
I yield back any balance I might have.
    [The prepared statement of Mr. Ellsworth follows:]

Prepared Statement of Hon. Brad Ellsworth, a Representative in Congress 
                       From the State of Indiana

    Thank you, Mr. Chairman, for allowing me the opportunity to address 
this committee on issues of special importance to the people in 
Indiana's 8th District. My career in law enforcement, my time listening 
to constituents, and my experience here in Congress have given me some 
unique insights into the importance of promoting our nation's 
priorities while maintaining our dedication to fiscal responsibility.
    During my 24-year career as a law enforcement officer with the 
local Sheriff's Office, I saw firsthand the bravery and sacrifice of 
our community police and firefighters. Even before terrorist attacks 
became a concern, these public servants had their hands full keeping 
the peace and protecting America's families at the local level.
    Our community police deal with domestic violence, theft, suicide 
threats, drug crime, and a host of other challenges as they step into 
their patrol cars each day. The efforts of these men and women allow 
the rest of us to feel secure in our cities, our neighborhoods, and our 
homes.
    In the early 1990s, the federal government provided local law 
enforcement with the ability to fulfill their duties in the midst of 
growing crime rates and drug use. The COPS program lowered the cost to 
local governments of hiring a new officer and put more than 120,000 
additional cops on our streets.
    This year, the President's budget contains a funding cut for the 
COPS program--from $558 million in fiscal year 2007 to $32 million in 
fiscal year 2008. This would amount to a 94% cut in the program in a 
single year. There is no doubt communities across the nation will 
suffer from such cuts. Fewer cops on the street results in more crime 
and more insecurity for America's communities.
    After 9/11, it became clear that foreign terrorists had the ability 
to attack us on our own soil--not only on the coasts, but also in the 
heartland. Overnight, our nation's community police and firefighters 
became our ``first-responders,'' and were suddenly thrust onto the 
battle lines of the new War on Terror. I can attest that these brave 
men and women did not expect this latest responsibility, but they 
proudly accepted it.
    As these new challenges strained already overwhelmed local budgets, 
the federal government stepped in to help municipal agencies face this 
new threat. Federal programs provided grants, training, and other 
assistance to community agencies charged with responding to a local 
terrorist attack. Without such programs, local officials would be 
unable to confront this new threat.
    Once again, the President's budget proposes massive cuts in funding 
to homeland security initiatives targeted at equipping America's first-
responders
     Law Enforcement Terrorism Prevention grants are cut by 30 
percent.
     Firefighter assistance grants are cut by 55 percent.
     State Homeland Security Grants are cut by 64 percent.
    Federal assistance to community policing and security has already 
been cut in half in the last decade. This 42 percent cut in overall 
homeland security assistance, combined with the virtual elimination of 
the COPS program, would cripple the ability of America's community 
police and firefighters to respond both to daily challenges and to 
catastrophic emergencies.
    The President of the International Association of Fire Fighters may 
have put it best. And I quote: ``Make no mistake, this budget proposal 
puts the safety and security of the American people at risk.'' Un-
quote. In our efforts toward our common goal of a balanced budget, we 
must not forget our duty to protect America's communities. It is a 
priority, and our budget must reflect its importance.
    Constituents throughout the 18 counties of my district share 
another common concern: the skyrocketing healthcare costs in America. 
The cost of health care is forcing the elderly to choose between their 
groceries and the prescriptions they need to survive. It's squeezing 
the bottom line of Hoosier small businesses. It's depriving many of our 
children the opportunity to fulfill their potential in the classroom.
    Of course, it's no secret to Hoosiers that the federal government 
can't solve all of their problems, and they don't expect us to. But, 
they also understand that government has a responsibility to help the 
neediest among us--those who can't help themselves.
    Few programs have been as successful in providing for those in need 
more than State Children's Health Insurance Program, or S-CHIP. When a 
Democratic President and a Republican Congress came together in 1997 to 
write S-CHIP into law, they were united with one purpose: to provide 
access to healthcare to those children who had fallen through the 
cracks. Their parents had jobs, but, like many Americans, they didn't 
get health insurance at work. They made just enough to disqualify them 
from Medicaid and not enough for them to buy private insurance.
    10 years later, over 6 million children across the country have 
access to quality healthcare through the S-CHIP program. These children 
enjoy a level playing field at school and have a better chance to 
succeed.
    Yet, despite the successes of this program, we are still faced with 
many challenges. In my state alone, 161,000 children are without health 
insurance. Nationwide, the number is closer to 9 million. And, while 
these numbers increase, the President's budget proposes to shrink S-
CHIP. In fact, the President requests that Congress under-fund S-CHIP 
by about $10 billion as it reauthorizes the program this year. His 
proposal would plunge many of these children back to the ranks of the 
uninsured.
    Fiscal responsibility--and a balanced budget in particular--is a 
goal that we share on both sides of the aisle. But, we can all agree 
that our nation's budget should illustrate our nation's values and 
priorities.
    As we consider our options and make the difficult choices that lead 
to fiscal responsibility, we need to address one of the most 
unnecessary obstacles to reaching a balanced budget: taxpayer dollars 
lost to waste, fraud, and abuse. There are too many instances to list 
in such a short time, but I have been here long enough to see some 
instructive examples.
    In my seat on the House Armed Services Committee, I have seen 
multiple reports of waste and abuse that are robbing our troops in Iraq 
of the support Congress provided them in previous budgets. A recent 
Defense Department Inspector General report showed that 15 percent of 
American taxpayer dollars devoted to Iraq reconstruction projects--
nearly $3 billion--has been wasted.
    The same report indicated that the State Department may have spent 
over $36 million on weapons and equipment that cannot be accounted for. 
Another audit discovered that 14,000 weapons supplied to Iraqi Security 
Forces have gone missing. Not only do errors like this waste taxpayer 
dollars meant to support US troops in harms way, they may further 
endanger our fighting men and women by arming violent militias. The 
funds and weapons unaccounted for in Iraq are not the only examples of 
waste and fraud I've seen.
    In my seat on the Small Business Committee, I have heard the 
numerous budget problems faced by government agencies, such as the 
Small Business Administration--where resources are so scarce that 
oversight is halted altogether, opening the door to fraud and abuse.
    This past weekend, a local nightly news report from Houston, Texas 
illustrated the waste that results from improper oversight. After the 
terrorist attacks on 9/11, the federal government authorized the Small 
Business Administration to provide loans to small businesses suffering 
from the economic toll of the attacks in New York and Washington, DC. 
This news report found nearly $100 million in 9/11-loans had been 
awarded to Houston area businesses, such as a carwash, a dry cleaner, a 
pre-school, and a yogurt shop.
    To prevent such waste, fraud, and abuse, Congress and the President 
must work together. It is unacceptable for billions of taxpayer dollars 
to be thrown away due to improper accounting and scant oversight.
    As we work together to balance our nation's budget, our priority 
must be reducing waste. Not only will efforts to stem the tide of waste 
move us closer to our goal of a balanced budget, but they will also 
demonstrate to the American people that their elected representatives 
are spending their money wisely.
    In closing, Mr. Chairman, the people back home who sent us here 
expect each and every one of us to work together to achieve a balanced 
budget that reflects our values and priorities.
    Fiscal responsibility is not a Democratic goal, and it's not a 
Republican goal. It's what our constituents expect. As their 
representatives, it's our responsibility to put in the long hours, make 
the tough decisions, and get our country back on the right path.
    Thank you, Mr. Chairman.

    Mr. Becerra [presiding]. We thank the gentleman for his 
testimony. And before, Congressman Ellsworth, you leave perhaps 
I could ask you a question. Having served in law enforcement, I 
am wondering if you could tell us whether or not your former 
colleagues in law enforcement back home are familiar with the 
President's budget and its impact on a number of law 
enforcement programs that you mentioned? COPS Program, for 
example, and are they getting back to you on any comments they 
may have?
    Mr. Ellsworth. They are very aware of it, Mr. Chairman. I 
have been called and visited by both law enforcement and 
firefighters, and they have been telling me every trip home the 
impact. And sometimes the larger agencies can absorb this. It 
is the smaller agencies that are really being hit. When we are 
talking about four and five men departments who rely on that 
just to run a third shift of patrol, that they rely on these 
type of programs. And they are going to have to cut that 
altogether. So having no police officer, no fire protection on 
a second and/or third shift. We are hearing that, and it is 
disturbing.
    Mr. Becerra. Well, we appreciate your testimony and the 
work that you are doing for the folks back home in Indiana. And 
we look forward to hearing from you again on the issues of the 
budget. So thank you very much for your testimony.
    Mr. Ellsworth. Thank you, Mr. Chairman.
    Mr. Becerra. At this time the Committee will recess until 
further members are present.
    [Recess.]
    Mr. Becerra. The Committee will resume hearing, and we will 
be back in order. We would like to now invite our next member 
to testify. We have Mr. John Boozman from Arizona.
    Mr. Boozman. Arkansas.
    Mr. Becerra. Arkansas, excuse me.
    Mr. Boozman. That is a very familiar mistake.
    Mr. Becerra. I apologize for that, Mr. Boozman. And we are 
allotting ten minutes for members to address the Committee and 
to respond to any questions if there is any time remaining. So 
with that, Mr. Boozman please move forward.

 STATEMENT OF HON. JOHN BOOZMAN, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF ARKANSAS

    Mr. Boozman. Thank you, Mr. Chairman, for listening to my 
testimony. And do not worry, it will not take ten minutes. I 
know you all have had a tough day and I really do appreciate 
the opportunity myself and the other members who have come up 
here and actually testified concerning things that they had 
concerns about. And this is really, you know, this is my third 
term in Congress and this is the first time that I have really, 
actually I guess a little bit longer than that. But actually, I 
won a special election so it is confusing. But anyway, this is 
the first time I have really afforded myself the opportunity to 
come and talk about something when I thought it was really 
important.
    But what I would like to visit with you about is a project, 
the Ozark-Jeta Taylor Powerhouse which happens to be located in 
the third district of Arkansas. The project is of fundamental 
importance to the citizens of my district, the State of 
Arkansas, and indeed the surrounding states of Oklahoma, 
Missouri, Texas, Kansas, and Louisiana. In all, over six 
million people will directly benefit from the clean, renewable, 
and efficient hydropower generated at Ozark Powerhouse once it 
is fully rehabilitated.
    Recognizing the importance of this project, the President's 
administration allocated $17.3 million to this project in its 
current budget proposal under its priority projects for the 
Corps of Engineers. I sincerely hope that the Committee will 
give the Ozark Powerhouse Project the same consideration and 
authorize at least the President's recommended amount in the 
budget proposal.
    There are five turbine generator units at Ozark, three at 
its counterpart facility the Webber Falls Powerhouse in 
Oklahoma. From 1999 through 2004, 2.4 generating units on 
average were unavailable at the Ozark Powerhouse from Webber 
Falls due to major failures resulting from significant design 
flaws. The damage sustained by one of the units at Ozark is so 
extensive that it will remain unavailable for service until it 
is rebuilt. And another unit is currently in imminent danger of 
failure.
    The benefits of completing this project continue to 
increase with the rising cost of energy and the increasing cost 
of repairing units which remain repairable. Every year these 
units remain out of service the government loses nearly $1 
million in energy sales revenues that otherwise would be 
returned to the U.S. Treasury. Furthermore, it costs 
Southwestern Power Administration's wholesale power customers 
an estimated $9 million to replace this lost energy with more 
expensive, less environmentally friendly sources. If we fail to 
act, we can expect higher life cycle maintenance costs at a 
higher rate than has been experienced in the past.
    In the past Congress has shown a major commitment to the 
project. In fiscal year 2003 Congress appropriated $2.5 million 
to begin the rehabilitation of Ozark. In 2005 the 
administration requested and Congress appropriated another $5 
million to begin the turbine acquisition contract for Ozark. 
Additionally, the power customers have shown a major commitment 
by providing more than $24 million to continue these 
rehabilitation projects. So it is a great public/private 
enterprise. However, this non-traditional funding method is 
merely a stop gap measure and diverts money from other 
maintenance and replacement projects at the Corps of Engineers 
hydropower plants that are funded by customers.
    Finally, it should be noted that every dollar spent on 
rehab of the Ozark Powerhouse will be returned to the Treasury 
with interest, meaning that the long term budgetary impact of 
complete rehabilitation is zero. Appropriating the 
administration's recommended $17.3 million will allow the Ozark 
Powerhouse to complete rehabilitation, allowing the facility to 
run more efficiently and reliably. While the Corps of Engineers 
expects its hydroplants to be available 96 percent of the time, 
during the past twenty years Ozark Powerhouse has only been 
available 90 percent of the time at best, dropping as low as 31 
percent availability in 2001.
    The Ozark-Jeta Taylor Powerhouse Rehab Project is a highly 
beneficial, revenue producing, self-sustaining, environmentally 
friendly, job creating project that will reduce our dependence 
on foreign energy. Failure to complete this project in a timely 
manner will result in the expansion of less environmentally 
friendly alternatives. Furthermore, this project will provide a 
positive return on the taxpayers' dollars. Funding this project 
will provide tremendous benefits for our nation's environment 
and economy. Our local communities will be thankful when the 
Corps of Engineers completes its work on this project.
    I again urge the Committee to conclude the Ozark Powerhouse 
Rehab in the House of Representatives fiscal year 2008 budget, 
and I certainly thank you, Mr. Chairman, for allowing, again, 
members like myself to come and testify.
    I was talking to the other Chairman, and explained that 
this, you know, was the first time that I had appeared before 
the Budget Committee to actually really, you know, ask 
consideration that we really look at a project. And certainly 
all of us, all of the members of Congress have things that they 
very much believe in. But this is a situation, you know we talk 
about renewable energy, we talk about reducing our dependence 
on foreign oil, we talk about all of these things. And yet, we 
have a situation in Ozark where the turbines are not working. 
They are slack water turbines, so they can be used when the 
river is very low. And when they are working they are very, 
very efficient. They were installed many years ago and it was 
kind of a, they were the first of their kind in the country. 
And because of that, you know, they have had some problems with 
them. All of that has been worked out. A lot of this type of 
turbine now is being used in Europe. But it really does make 
sense. The cost/benefit ratio is very, very good. It is a unit 
that not only does it benefit my district in the sense of 
producing power there, but produces power throughout the 
surrounding states.
    So again, you know, it is one of those things that if we do 
not get it done now the other thing that we run into is the 
projects drop down, and they do not have enough money to 
continue the budget in the contract. Then you wind up, you 
know, paying much, much more money in the future. You know, as 
somebody rediscovers how this really is a great project, we 
need to get it done. So, like I said, it is in the President's 
budget. It is something that I think everyone agrees is a very 
worthwhile project and we really would appreciate the 
Committee's ability to keep the project in as you make very 
difficult decisions concerning the budget, and I certainly 
understand that also.
    So if you have any questions, fine. I know it has been a 
very, very long day for you all and I am glad you are getting 
done a little bit early.
    [The prepared statement of Mr. Boozman follows:

 Prepared Statement of Hon. John Boozman, a Representative in Congress 
                       From the State of Arkansas

    Chairman Spratt, Ranking Member Ryan and members of the House 
Budget Committee, thank you for allowing me the opportunity today to 
express to you the importance of authorizing funds for the Ozark-Jeta 
Taylor Powerhouse in the 3rd District of Arkansas.
    This project is of fundamental importance to the citizens of my 
district, the state of Arkansas and indeed the surrounding states of 
Oklahoma, Missouri, Texas, Kansas and Louisiana. In all, over 6 million 
people will directly benefit from the clean, renewable and efficient 
hydropower generated at Ozark Powerhouse once it is fully 
rehabilitated. Recognizing the importance of this project, the 
President's Administration allocated $17.3 million to this project in 
its current budget proposal, under its priority projects for the Corps 
of Engineers. I sincerely hope that this Committee will give the Ozark 
Powerhouse project the same consideration and authorize at least the 
President's recommended amount in the House Budget Proposal.
    There are five turbine-generator units at Ozark and three at its 
counterpart facility, the Webbers Falls Powerhouse in Oklahoma. From 
1999 through 2004, 2.4 generating units, on average, were unavailable 
at the Ozark Powerhouse and Webbers Falls, due to major failures 
resulting from significant design flaws. The damage sustained by one of 
the units at Ozark is so extensive that it will remain unavailable for 
service until it is rebuilt, and another unit is currently in imminent 
danger of failure.
    The benefits of completing this project continue to increase with 
the rising cost of energy and the increasing cost of repairing the 
units which remain repairable. Every year these units remain out of 
service, the government loses nearly $1 million in energy sales 
revenues that otherwise would be returned to the U.S. Treasury. 
Furthermore, it costs Southwestern Power Administration's wholesale 
power customers an estimated $9 million to replace this lost energy 
with more expensive, less environmentally-friendly sources. If we fail 
to act, we can expect higher life-cycle maintenance costs and a higher 
failure rate than has been experienced in the past.
    In the past, Congress has shown a major commitment to this project. 
In FY2003, Congress appropriated $2.5 million to begin the major 
rehabilitation at Ozark. In FY2005, the Administration requested, and 
Congress appropriated, another $5 million to begin the turbine 
acquisition contract for Ozark. Additionally, the power customers have 
shown a major commitment by providing more than $24 million to continue 
these rehabilitation projects. However, this non-traditional funding 
method is merely a stop-gap measure, and diverts money from other 
maintenance and replacement projects at Corps of Engineer hydropower 
plants that are funded by customers. Finally, it should be noted that 
every dollar spent on rehabilitation of the Ozark Powerhouse will be 
returned to the Treasury with interest, meaning that the long-term 
budgetary impact of completing the rehabilitation is zero.
    Appropriating the Administration's recommended $17.3 million will 
allow the Ozark Powerhouse to complete rehabilitation, allowing the 
facility to run more efficiently and reliably. While the Corps of 
Engineers expects its hydroplants to be available 96% of the time, 
during the past twenty years, Ozark Powerhouse has only been available 
90% of the time, at best--dropping as low as 31% availability in 2001.
    The Ozark-Jeta Taylor Powerhouse Rehabilitation project is a highly 
beneficial, revenue producing, self-sustaining, environmentally 
friendly, job-creating project that would reduce our dependence on 
foreign energy. Failure to complete this project in a timely manner 
will result in the expansion of less environmentally-friendly 
alternatives. Furthermore, this project will provide a positive return 
on the taxpayers' dollars. Funding this project would provide 
tremendous benefits for our nation's environment and economy. Our local 
communities will be thankful when the Corps of Engineers completes its 
work on this project. I again urge you to include the Ozark Powerhouse 
Rehabilitation in the House of Representative's FY2008 Budget. I thank 
the Chairman, the Ranking Member and all the members of the Committee 
for their time and thoughtful consideration.

    Chairman Spratt. Well listen, we very much appreciate your 
coming, your testimony which you have offered is something that 
we probably would have otherwise overlooked. So I feel like it 
has made a difference and we will see what we can do.
    Mr. Boozman. Well, thank you very much. And again, thank 
you for the opportunity.
    Chairman Spratt. Sure, thank you for coming.
    Mr. Boozman. Yes, sir.
    Chairman Spratt. Ms. Watson?
    Ms. Watson. Mr. Chairman, thank you so much for this 
opportunity.
    Chairman Spratt. Thank you so much for coming.

 STATEMENT OF HON. DIANE WATSON, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF CALIFORNIA

    Ms. Watson. And I am going to make it real quick for you. I 
saw Representative Becerra sitting in his seat, and he would 
recognize this problem that I am bringing to your attention. I 
want to talk about an urgent issue in my own hometown in Los 
Angeles that would be really negatively impacted with the cuts 
in the President's budget.
    Mr. Chairman, our children are killing one another at an 
appalling rate. The Los Angeles Police Department recorded 
7,714 gang crimes in 2006, a 14 percent jump over the previous 
year. The most disturbing new element in this wave of violence 
is that a growing number of these crimes have a racial or 
ethnic character as some gangs try to ethnically cleanse their 
neighborhoods.
    I believe we need to take a comprehensive approach to 
combating gang violence. We need to ensure that our youth have 
safe, quality schools that give them an alternative to the 
streets. We need to make sure our kids have job opportunities 
once they leave school. But there is one action that we can 
take right now that will immediately reduce the level of 
violence and protect our kids and that is to put more police on 
the streets.
    We have a program that will do just that, and I think you 
are familiar, Mr. Chairman, with the COPS Program, the 
Community Oriented Policing Program. And it has been a beacon 
of light in urban communities where crime is high and police 
presence is low. This program has been a central part of 
keeping our streets safe. Since its inception the COPS Program 
has put almost 150,000 police officers on the street. In my 
hometown of Los Angeles, that meant almost 250 new officers in 
the year 2005 alone.
    Unfortunately, the President's 2008 budget would reduce 
essential funding for programs that assist state and local 
governments in combating this violent crime. The budget 
provides only $32 million in new funding for the COPS Program 
compared with 2007 funding of more than $542 million. The 
program also cuts $87 million of the programs existing 
resources and this is unacceptable. Despite all the talk about 
supporting local police from the administration, the 
President's budget starves the COPS Program of its funds. 
Because of the administration's marriage to big tax cuts, this 
budget proposes cutting this program by $87 million. And that 
$87 million could pay for over 1700 new local police officers 
helping Los Angeles and other cities big and small across the 
U.S. deter and fight this street crime.
    Mr. Chairman, I urge the Committee to restore full funding 
for COPS. Our citizens deserve to feel safe in their own 
neighborhoods, and cutting funds to programs that serve these 
purposes is not the answer. We have a responsibility with the 
new majority in our Congress to put our citizens first. And Mr. 
Chairman, the President's budget simply does not do that.
    So I want to thank you, Mr. Chairman, and if you have any 
questions I would be happy to answer them. And I do have an 
article from the L.A. Times that underscores my presentation.
    [The prepared statement of Ms. Watson follows:]

    Prepared Statement of Hon. Diane E. Watson, a Representative in 
                 Congress From the State of California

    Mr. Chairman, thank you for the opportunity to address the 
Committee today and discuss the President's Fiscal Year 2008 budget. I 
hope that the Committee will work together to develop a federal budget 
that is fiscally smart and serves the needs of all Americans.
    Mr. Chairman the President's budget for Fiscal Year 2008 imposes 
cuts to several mandatory and entitlement programs that are important 
to the domestic fabric of America. Healthcare, education, social 
security, the environment, transportation, and energy are issues that 
impact our citizens every single day. The President has made major cuts 
in these areas in his 2008 budget. This budget, again this year, does 
not meet the needs of the American people.
    But today I want to talk about an urgent issue in my own hometown 
of Los Angeles. And that is the rising level of violence on our 
streets.
    Mr. Chairman, our children are killing one another at an appalling 
rate. The Los Angeles Police Department recorded 7,714 gang crimes in 
2006, a fourteen percent jump over the previous year. The most 
disturbing new element in this wave of violence is that a growing 
number of these crimes have a racial or ethnic character, as some gangs 
try to ethnically cleanse their neighborhoods.
    I believe we need to take a comprehensive approach to combatting 
gang violence. We need ensure that our youth have safe, quality schools 
that give them an alternative to the streets. We need to make sure our 
kids have job opportunities once they leave school.
    But there is one action we can take right now, that will 
immediately reduce the level of violence and protect our kids. And that 
is put more police on the streets. We have a program to do just that; 
the COPS program.
    The Community Oriented Policing program known as COPS, has been a 
beacon of light in urban communities where crime is high and police 
presence is low. This program has been an essential part of keeping 
streets safe. Since its inception, the COPS program has put almost one 
hundred and fifty thousand police officers on the street. In my home 
town of Los Angeles, that meant almost two hundred fifty new officers 
in 2005 alone.
    Unfortunately, the President's 2008 budget would reduce essential 
funding for programs that assist state and local governments in 
combating violent crime. The budget provides only $32 million in new 
funding for the COPS program for 2008, compared with 2007 funding of 
more than $542 million. The program also cuts $87 million of the 
programs existing resources. This is unacceptable.
    Despite all the talk about supporting local police from the 
Administration, the President's budget starves the COPS program of its 
funds. Because of the Administration's marriage to big tax cuts, this 
budget proposes cutting this program by $87 million. That $87 million 
dollars could pay for over seventeen hundred new local police officers 
helping Los Angeles and other cities, big and small, across the United 
States, deter and fight crime.
    Mr. Chairman, I urge the committee to restore full funding for 
COPS. Our citizens deserve to feel safe in their own neighborhoods. 
Cutting funds to programs that serves these purposes is not the answer. 
We have a responsibility with a new majority in Congress to put our 
citizens first. The President's budget does not.
    Thank you, Mr. Chairman.

            [From the Los Angeles Times, February 13, 2007]

               Residents Demand Action Over Gang Violence

 About 200 meet with Councilman Garcetti and police in Glassell Park, 
               where a teen was shot to death last week.

                         By J. Michael Kennedy

    Just outside, children were playing soccer. But inside a Glassell 
Park gym Monday evening, the mood was somber as people demanded to know 
why a young woman had been killed in a seemingly senseless act of 
violence, and what the city was doing about it.
    Franklin High School student Melissa Paul, 16, was shot to death 
Feb. 6 as she walked with two friends near the Glassell Park Recreation 
Center in Los Angeles.
    Police said the assailant was a passenger in a white minivan that 
had driven past the three youths.
    A 16-year-old boy, allegedly part of a local gang, was later 
arrested on weapons charges and is under investigation in the shooting, 
said Jose Carrillo, a homicide detective with the Los Angeles Police 
Department.
    Paul was apparently the victim of a shot aimed at a gang rival, 
authorities said.
    Glassell Park is a largely Latino community of modest stucco homes 
northwest of downtown L.A., near Glendale. With fear and anger in the 
community rising, City Councilman Eric Garcetti called the meeting 
Monday, drawing a crowd of about 200.
    Most of the discussion focused on general fears about gang 
violence.
    The mood was summed up by resident David Mukogawa, who tossed an 
American flag onto the table in front of Garcetti and other city and 
police officials. The flag had flown in front of Mukogawa's house until 
last week, when it was spray-painted with orange gang signs.
    ``I want to know what's going to be done about something like 
that,'' Mukogawa said, adding that his home had been tagged three times 
in the same week--once on the flag, once on his fence and once on his 
mailbox.
    In response, Garcetti urged people to come forward and report such 
signs of gang activity. ``If we are silent, then we become numb,'' he 
said.
    Echoing that plea was Felix Hernandez, an official with the Anahuak 
Youth Soccer Assn., who called for more frequent community meetings and 
greater involvement to give police the information they need.
    ``If we don't report incidents, they won't put a dot on their map, 
and next month there won't be as many cops in the area,'' he said.

    Chairman Spratt. Well, you were the beneficiary of 250 new 
officers in the year 2005. In the five or six-year period when 
this program was at its highest level we were able to add 125 
policemen all over the fifth district of South Carolina where I 
live. So I can bear testimony to the same results that you have 
just talked about. I have seen it throughout my neighborhoods. 
And furthermore, we have sold the idea of community policing by 
example, by putting the money out to support what we were 
saying about community policing. It has worked. I have seen it 
work. I have heard people talking about it, and I have heard 
police officers say it is a good program. There are other 
programs that we have to be concerned about, too: The Byrne 
Grants, Law Enforcement Block Grant.
    So full restoration of the COPS Program is probably not 
possible in this budget. We certainly want to restore some of 
it above the existing level, which basically is a maintenance 
of effort level to pay for the COPS who were originally hired 
under the program and have not quite yet served out that three 
or four-year commitment, that three or four-year funding 
commitment from the federal government. We definitely want to 
do something in this area of the budget if we at all can.
    But having you to back us up from L.A. to a very different 
perspective than I have got, but it is working in both places. 
Something that works in York, South Carolina and Los Angeles, 
California has got to be a good program.
    Ms. Watson. Well, I appreciate your sensitivity and your 
experience with the program. I would like to leave this article 
with your staff. It just describes a recent killing of a very 
young girl, sixteen years old, because of out of control gang 
violence. And we are so understaffed in our police department 
in Los Angeles, the need is desperate. And you understand it. 
And if we can just address it in any way we can I think that 
will be a step in the right direction.
    So thank you so much, Mr. Chairman.
    Chairman Spratt. Thank you for coming, and thank you for 
your excellent testimony. We will take it to heart. Mr. Bishop?
    Mr. Bishop of Utah. Mr. Chairman, I do not know if you have 
one of these with you?
    Chairman Spratt. I do not believe I do, Rob. Welcome to the 
Committee. We look forward to your testimony, the floor is 
yours.

STATEMENT OF HON. ROB BISHOP, A REPRESENTATIVE IN CONGRESS FROM 
                       THE STATE OF UTAH

    Mr. Bishop of Utah. Well, I apologize for making you stay 
here but you wanted to be Chairman. And I understand I am the 
last one you have to go through so I will try to be as brutally 
brief as I possibly can. I appreciate having Members' Day here. 
We have submitted our testimony to you. I think there is a typo 
on work number twenty-two but I hope you will overlook that 
one.
    I am here as the Communication Chairman for the Western 
State Caucus as well as the Ranking Member on the Parks, Public 
Lands and Forest Subcommittee of Resources so land issues 
obviously are extremely important. I recognize also that this 
is the time of year when everyone and their third cousin comes 
to Washington. They all come into our office and say, ``You 
know, the budget is terrible. You need to control things. But 
my program is special.'' In some respects I am doing the same 
thing to you here today. Except I do think I can make a case 
that there is something different. There are about three 
programs in the President's budget that I would like to talk to 
you about.
    Very quickly, the first and the most important is Payment 
in Lieu of Taxes. This program has been around since 1976. We 
are in the fourth decade and it seems like every year we play 
the same game where the OMB cuts the funding for it, this 
Committee recommends that it should be looked at by the 
Appropriators and increased in some way. The Appropriators 
increase it on the House side, and the Senate cuts it down in 
conference. And then we repeat the same game the next year. 
Which I have to admit I am very tired of the game and where it 
starts, and I am not blaming you for that one. Because actually 
this Committee has been very favorable to this program and very 
helpful in years past. But there is that political waltz we 
play of two steps forward, one step back, and then you side 
step a bit. And we seem to be in that.
    PILT is difficult, I realize, especially on the 
administration level because it has no Washington officers. 
There is no executive branch to push for it. The only people 
that get this are the people on the local levels where the 
money goes directly, and they are using it very wisely. Every 
state but one has federal land that benefits from PILT. But it 
obviously has a greater impact in the mountain west than in 
other areas. And sometimes what we take for granted in the west 
in understanding this issue is difficult for those unless you 
have a public land state or county in the process.
    The PILT funding is there for three basic reasons. The 
federal government does not pay taxes on the land it owns. It 
does pay royalties and fees, but the distribution process of 
that does not guarantee that it is equitably given to the 
counties where the services were mandated. Also, the public 
lands decreases the economic opportunities of those who have 
public lands. If you have 92 percent, as many of my counties in 
my state have, owned by the federal government, you have to 
build a base for your services and county government on the 8 
percent that is left. Ironically, two years ago the Washington 
Post sent forth an editorial talking about the same problems 
that Washington, D.C. had when they wrote about the fact that 
the federal government is the largest land owner in Washington. 
Since this land cannot be taxed, the federal government is a 
principal contributor to the District's chronic fiscal 
imbalance. I agree with them. Because that is the same argument 
that we have been making year after year dealing with federal 
lands, especially in the west where the definition is higher.
    Also, the federal government seems to treat the west a 
little bit different because of that factor with only 
Washington, D.C. coming in there. I can do this very quickly. I 
am trying to walk through that again. If you look at the first 
page, you see the growth in PILT funding as a percentage of the 
spending that has been done on Interior budgets altogether. 
Basically, PILT was flatlined from its inception to about the 
year 2000. In recent years Congress has been doing a better job 
because they have realized the significance of this program on 
the counties where the impact is felt. However, the bottom line 
of the numbers are this year the administration suggested $190 
million. That is $8 million less than they suggested for this 
program last year in their budget. Last year this Congress 
funded it at $232 million, even though the House passed one 
that was I think--pick out the number for that last one, I do 
not know what it is.
    The House has been very popular, has been very positive to 
this program. The Senate has usually cut it down, and we are 
significantly more than the administration. I have to admit, I 
feel a great deal of frustration with my administration for how 
they play this game, cut and expect Congress to boost up this 
program of significance.
    If I could also have you look carefully at the second page 
that is there, once again the distribution of public lands is 
picked up in the pictures in the number of, the stuff that is 
blue is how much federal land is owned in each of those states.
    Chairman Spratt. It is a very effective chart.
    Mr. Bishop of Utah. It is frustrating for me, too.
    Chairman Spratt. I am sure.
    Mr. Bishop of Utah. Because I am one of those. And that is 
the problem and the basis that we have. I want to add one other 
thing to you, and then if there is any questions you have. One 
of the phenomena that we have also found, if you look at the 
last chart, PILT has absolutely nothing to do with funding of 
education in western states. But PILT's issue is the same thing 
education faces. One of the ironies we found out is the states 
that are in red on that last chart are the states that have the 
most difficult time in funding increases to their education 
budgets. And the phenomenon is, if you compare the two charts, 
the blue one with the red one, you see there is almost a one to 
one correlation between states with a great deal of federal 
lands and their inability to effectively fund the education 
system for their kids. Which once again, I feel a double 
whammy. As a schoolteacher I think my pay and retirement was 
retarded because of this problem. And my kids, I think their 
education level was diminished because of this particular 
problem.
    This is not one to one correlation with PILT, but it is the 
same problems. The amount of federal lands has a negative 
impact on the ability of states to actually raise the money and 
raise the taxes and pay for their own programs by themselves. 
Which is why we are going to ask you very seriously on your 
Committee, on the assumption they are all here and listening to 
me, to seriously look at this issue of PILT. That the 
President's budget yearly underestimates the significance of 
it. Someone in the administration talked of it as being welfare 
for the west. To be honest, we look at it as rent that is due 
for the land that is there because there is no other way we can 
survive. If you want to give us all the land back so that our 
blue map looks very similar to the east, we would be tickled to 
death and we would not talk to you about it again. But until 
that stage of nirvana actually hits, we definitely need 
programs like PILT.
    Now, in our written testimony there are some other 
programs. And if I can just very quickly tell you about them. 
The ADP Processing and User Fees is one of the simple 
situations because you are putting a fee, if you already have a 
lease the fee is almost like a taking to that lease. But the 
difficulty is, that lease does not distinguish between ability 
to pay. So a small developer has a much more difficult time of 
paying than a large developer, which inhibits the ability of 
actually developing those lands. Geothermal payments are 
supposedly not going to the host county, which once again to me 
is lacking of common sense and it puts the burden once again on 
the counties that provide that service. Or it forces the 
counties to put the burden on the geothermal developers who, 
once again that changes their basic operation costs and their 
profit margin whether they can actually be successful or not. 
And finally, the administration zeros out the Range Improvement 
Fund, which is a small program but once again it is extremely 
important to rural, western communities to develop rangeland 
potential.
    And once again, I feel for you having to be here this long. 
I am trying to get through this as quickly as possible. And I 
usually am cumbersome in what I say. If there is something, if 
you have questions I will do it.
    [The prepared statement of Mr. Bishop of Utah follows:]

  Prepared Statement of Hon. Rob Bishop, a Representative in Congress 
                         From the State of Utah

    Good evening Chairman Spratt and Ranking Member Ryan. This same 
hearing was also held on Valentine's Day last year. I suppose it 
apropos to hold budget hearings on Valentine's Day and following my 
testimony you should feel my love for the Administration's budget for 
FY07. I appreciate your opening up the microphone for ``Members' Day.'' 
I come before you wearing multiple hats: I am the communications and 
outreach chairman for the Congressional Western Caucus, Ranking 
Republican on the Natural Resources Subcommittee on National Parks, 
Forests and Public Lands, and a member from the rural part of the 
United States. So I suppose I am qualified to speak on the issue I am 
about to address.
    Each year I endure countless visits from constituents who come in 
and say, ``I know it's a tight budget year and our organization 
supports the Administration's budget (and here comes the proverbial 
``but ''), but my program is so important that you can't cut funding 
for it and we ask that you increase our budget by 20 percent.'' We've 
all experienced these types of visits, where advocates for various 
programs come in and not only want to keep their program intact but 
also increase their piece of the federal pie. On its face, my visit to 
your committee may seem no different. I assure you it is not. Can you 
feel the love?
    Counties throughout the United States, particularly those with a 
high percentage of federal lands ownership, rely on Payment in Lieu of 
Taxes, a little known federal program first authorized in 1976 to help 
offset the cost of providing essential (local) government services on 
and for the benefit of users of our federal lands. However, local 
counties may neither lay nor collect taxes on federally owned lands, 
thus negatively impacting their ability to provide these services. The 
program to which I am referring is Payment in Lieu of Taxes (or PILT) 
and this federal program accomplishes just what its name implies. 
Funding for this critical program is requested as part of the 
President's budget, is funded in the Interior Appropriations Act, and 
is managed by the Department of the Interior.
    Just over four years ago, the PILT program was managed by the 
Bureau of Land Management (BLM) and was treated so abysmally by the BLM 
that the Secretary of the Department of the Interior transferred 
authority of the program over to her department. This was done as the 
Secretary noted in her press release so that: ``PILT will be more 
fairly treated if we deal with it at the department-level.'' Sadly, not 
only did Secretary Norton fail to make this program a priority, so also 
has Secretary Kempthorne.
    The FY08 request for PILT is 42.5 million dollars below its FY06 
and FY07 funding levels. I am disappointed in the disingenuousness with 
which the current Administration treats this program. In a recent press 
release the Secretary's office noted: ``[* * * Funding for PILT remains 
at levels 50-60 percent higher than in the 1990s.]'' Somehow because 
the current Administration has done better than the Clinton 
Administration that's supposed to be good enough! Well, it is not--and 
here's why: the federal government has become an absentee slumlord in 
the West, owning over \1/3\ of all land in the United States and up to 
as much as 90 percent in some Western states. The federal government 
owns or controls \2/3\s of the land in my home state of Utah. High 
federal lands ownership comes at a price to rural America. I would 
argue that PILT is rent due on lands controlled by the federal 
government.
    Because the federal government is not required to pay property 
taxes on the millions of acres it owns, it thereby reduces the amount 
of tax revenue available to public lands counties. The federal 
government does not share proportionally with the impacted communities 
the higher cost now associated with providing medical services, 
education, search and rescue, trash removal etc. on these federally-
owned lands. While ownership remains in the hands of the federal 
government, the responsibility to provide services to the millions of 
people who frequent them falls to the counties. PILT is a pittance and 
does not even come close to offsetting the high cost of providing 
essential government services on these public lands.
    Although the preponderance of PILT monies goes to the West, that is 
because the West has the highest federal lands presence. Moreover, the 
federal government treats the West differently than any other section 
of the country. I can understand that unless you are from the West or 
reside in a public-lands county, it is difficult to grasp these 
concepts.
    Frequently the Administration will cite as one of their chief 
reasons for underfunding PILT the fact that there is some small amount 
of funding that goes to the states via royalty revenue sharing, and 
recreational fees. Again, these payments do not begin to offset the 
complete lack of tax revenue from these un-taxable lands. It is because 
of the high amount of federal ownership of lands in the West that 
western states and particularly rural counties have had a hard time 
building a prosperous economic base. Many western communities' 
boundaries are constrained by PILT, causing the price of homes and land 
to increase dramatically. Further, because of a high amount of federal 
lands ownership it is difficult to build an industrial base. If jobs 
are available at all, they are in the service sector and are typically 
seasonal and low-paying. It is unfortunate that the federal government 
has created this artificial situation.
    As it pertains to PILT funding, there is no federal governmental 
constituency to lobby for this funding--only local governments who use 
the money efficiently to help people. Unfortunately members of Congress 
from public lands counties annually repeat this cycle of getting low-
balled in the budget and then fighting for our lives. This program 
needs legislative protection, for in this area there is an apparent 
lack of concern for or understanding about rural and Western America. 
Were it not for historic congressional support for this program 
(constant prodding of the executive by the legislative) then this 
essential program probably would have died years ago. It is only 
because of congressional action that we have been able to save the 
local governments in the impacted states.
    There are several other issues that I find disturbing in the FY08 
budget request, in particular APD processing and user fees. Existing 
lessees already have a right to develop their leases as defined in the 
bundle of their ``rights'' which accompanies their lease. Presently, 
ruinously high fees prohibit an existing lease from being developed and 
approximate a taking of private property. Current fees proposed by the 
Administration are an assault on independent and small scale operators. 
If the same fees are imposed on all operators without regard to their 
ability to pay, then that will damage small-scale operators and benefit 
the larger operations. Small operators are the bread and butter of many 
rural western communities and this assault on them by the 
Administration will discourage domestic investment and is bad policy.
    As it pertains to Geothermal payments to counties, the 
Administration's proposal to redirect geothermal leasing funds away 
from the counties that host geothermal operations defies common sense--
counties are the very folks who must face the music of any sort of 
development--including geothermal energy development. Counties must 
provide services to the geothermal operators and their employees. These 
services must be paid for and failure to provide law enforcement for 
example is not an option. Counties must provide these services with 
only limited ways to pay for them. If the burden is passed to the 
operators and employees of geothermal operations through taxes, it can 
change the economics of a project for the worst. By granting some of 
what would otherwise be a part of the federal share of royalties, we in 
fact encourage the development of this renewable resource.
    Again this year the Administration has chosen to zero out the Range 
Improvement Fund. This small program allows the BLM to get dollars on 
the ground for range improvement. This is a vital program on a local 
level and another example of the political games the Administration is 
playing at the expense of Western Communities. Responsible development 
of public natural resources is good for our communities, our economy 
and our national security. These programs are small in the context of 
the budget. However the real impact these cuts will have on folks on 
the ground is damaging to rural western communities. This is 
unacceptable and I urge you to prioritize funding for these important 
programs.
    With that, Chairman Spratt and Ranking Member Ryan, I yield back 
the balance of my time.

    Chairman Spratt. You still have time on the clock to start 
with, but I am willing to listen to it because I am to some 
extent affected by that. I have the Sumter National Forest in 
my district.
    Mr. Bishop of Utah. If you have a National Forest you will 
know exactly what I am talking about. I think the State of 
Rhode Island is the only state that does not qualify for any 
kind of funding. But the second map that shows you the amount 
of federal lands, clearly this is a western issue that is 
almost like life and death. Any questions you have, once again 
we would be very happy if the Budget Committee would make 
another recommendation.
    Chairman Spratt. You are proposing to support them for the 
level of funding that the House produced last year that ended 
up being cut in conference?
    Mr. Bishop of Utah. Actually, I would support, as difficult 
as this is going to be for anyone, to go to the full 
authorization, which is about $320 million something. The House 
last year came up to a $240 million figure, which I think would 
be a nice starting assignment. About four years ago the 
Interior Department took PILT funding out of the BLM and said, 
``We will put it under the Secretary's budget procedure so we 
will give it greater visibility and easier time of funding,'' 
and they would fund it at an incremental stage until they 
reached the level of authorization. That has, quite frankly, 
never happened. They have never started the incrementalization. 
They did move it, but they did not actually do any of the 
incrementalization. $240 million which would what we did last 
year I think is doable and is at least appropriate for the 
first stage.
    When PILT was originally passed it was funded at 99 percent 
of the authorization level. We obviously have increased the 
authorization. So we are funding about 60 percent of the 
authorization, 67 percent of the authorization level right now. 
Obviously, the higher you get the better off it would be 
because this program I think goes directly to counties and pays 
for stuff that is used very frugally by them.
    Chairman Spratt. Thank you very much. I appreciate your 
testimony.
    Mr. Bishop of Utah. I ran another two minutes down, if that 
is----
    Chairman Spratt. Keep talking.
    Mr. Bishop of Utah. I am done. No, I do not want to put you 
through, unless there is something specifically that I did not 
cover or was confusing in the way I presented it.
    Chairman Spratt. Okay.
    Mr. Bishop of Utah. Thank you, Mr. Chairman.
    Chairman Spratt. Thank you very much indeed for coming. We 
finally conclude. I ask for unanimous consent that all members' 
statements be included in the record. In addition, I ask for 
unanimous consent that all members unable to attend the hearing 
today be allowed to submit statements for the record. Without 
objection, so ordered. This concludes the hearing. The 
Committee stands adjourned.
    [Additional submissions of Members follow:]
    [The prepared statement of Ms. Bordallo follows:]

    Prepared Statement of Hon. Madeleine Z. Bordallo, a Delegate in 
                  Congress From the Territory of Guam

    Good afternoon Chairman Spratt and Ranking Member Ryan. Thank you 
for the opportunity to testify before the House Committee on the Budget 
on the Administration's budget proposal for Fiscal Year 2008 and Guam's 
budget priorities for the upcoming year. I greatly appreciate your 
attention to and consideration of the priorities that I identify.
    First, I respectfully request and appeal to the Committee to 
include in its proposed budget resolution for Fiscal Year 2008 
sufficient budgetary headroom to allow for the Committee on Natural 
Resources and the Committee on the Judiciary to be able to effectively 
report out and bring to the House floor during this session of the 
110th Congress legislation to implement the recommendations of the Guam 
War Claims Review Commission. Second, I respectfully request that the 
budget resolution for Fiscal Year 2008 also include budgetary headroom 
for the Department of Labor to provide additional workforce development 
programs and projects on Guam.
    I introduced H.R. 1595, the Guam World War II Loyalty Recognition 
Act, during to 109th Congress. This legislation was cosponsored by 112 
Members of the House and was favorably reported out of the Committee on 
Resources and the Committee on the Judiciary. If enacted, the 
legislation would have implemented the recommendations of Guam War 
Claims Review Commission. Regrettably, the 109th Congress adjourned 
before H.R. 1595 was scheduled for a vote by the House. Despite this, 
the progress realized in the 109th Congress on this issue was 
encouraging. That H.R. 1595 was favorably reported out of two 
committees of jurisdiction during the 109th Congress represented the 
furthest point in the legislative process that this issue has ever 
advanced. Guam war claims legislation will be reintroduced again in 
this Congress. This will be the 12th Guam war claims bill introduced in 
the House of Representatives since the first such measure was 
introduced by Congressman Antonio Won Pat, Guam's first Delegate to 
Congress, in 1983 in the 98th Congress.
    The 107th Congress enacted legislation which authorized the 
establishment of a federal commission. This commission was charged by 
Congress with determining whether there was parity of war claims paid 
to the residents of Guam for the experiences and losses they suffered 
as loyal Americans during the enemy occupation of Guam during World War 
II as compared with awards made to other similarly affected U.S. 
citizens or nationals under war claims programs authorized by Congress.
    The Commission, which was appointed by the Secretary of the 
Interior, reported to Congress with findings and recommendations in 
2004. The Commission found that:
     Congress was misinformed when it excluded Guam from 
coverage under Title II of the War Claims Act of 1948, further amended 
in 1962.
     A lack of parity in war claims for the people of Guam in 
both process and amounts vis-a-vis other war claims programs authorized 
by Congress for similarly affected U.S. citizens and U.S. nationals.
     The United States Government has a ``moral obligation'' to 
pay the people of Guam for war damages.
    The Congressional Budget Office estimates that the budget should 
provide for a least $180 million over three fiscal years for 
legislation to implement the recommendations of the Guam War Claims 
Review Commission, as reported out by the two committees in the 
immediate previous Congress, to be enacted. This estimate is based on 
every possible conceivable claim whose payment would be authorized by 
the legislation.
    The Guam War Claims legislation I plan to introduce during the 
110th will, like its predecessor H.R. 1595 (109th) and in accordance 
with the spirit of the recommendations of the Guam War Claims Review 
Commission, authorize the Foreign Claims Settlement Commission of the 
United States to serve as the adjudicating authority to redress 
outstanding claims for deaths and injuries suffered by the people of 
Guam during the occupation. This is structure for adjudicating claims 
that would have been authorized by H.R.1595 (109th).
    To fulfill their Congressional mandate, the Guam War Claims 
Commission conducted hearings on Guam to receive testimony from 
survivors. In addition to these hearings, the Commission also received 
questionnaires from survivors on their occupational experiences. In 
total, approximately 8,000 questionnaires were received by the 
Commission primarily from survivors in Guam and to a smaller extent, 
from throughout the entire United States. Based upon these returned 
questionnaires, it is estimated that the amounts of actual claims would 
be significantly lower than the Commission's original estimates and the 
conservative estimate provided by CBO. Death claims may be as low as 
330 based on the self-declarations in the questionnaires. While injury 
claims may actually number closer to 4,000 to 5,000. It should also be 
noted that the final report of the Guam War Claims Review Commission 
included estimates for the potential death and personal injury claims. 
The Commission estimated total funding for claims to be $126 million 
based on 1,000 deaths and 8,551 survivors.
    The Congress has a moral obligation to bring closure for the loyal 
Americans who experienced the brutality of the occupation on Guam. I 
respectfully request that the budget resolution for Fiscal Year 2008 
take into account legislation that would help fulfill our moral 
obligation to our fellow Americans and to bring justice to them as has 
been recommended by the federal commission authorized by the 107th 
Congress.
    Looking forward, Guam will soon begin a period marked by increased 
federal investment for infrastructure improvements to the island's 
military bases and to other areas. The majority of this increased 
investment is pursuant to a bi-lateral agreement the United States and 
the government of Japan reached last year regarding the relocation of 
elements of the III Marine Expeditionary Force (MEF) from Okinawa, 
Japan, to Guam over a period of at least ten years beginning as soon as 
2008. Elements of the III MEF liberated Guam from Imperial Japanese 
occupation in 1944. Guam welcomes the Marines back to our island.
    Department of Defense (DOD) spending in Guam is a prime economic 
driver for the island in addition to the visitor service and 
hospitality industries. The Administration's Fiscal Year 2008 budget 
request includes increased spending for infrastructure development on 
Guam and within the two military bases on the island--Naval Base Guam 
and Andersen Air Force Base. The planned increase in Federal spending 
to support the military build-up on Guam promises to create new jobs 
for Guam's economy and to provide opportunities to strengthen and 
diversify Guam's private sector. I urge the Committee to support the 
Administration's request for military construction spending.
    In doing so, I also want to urge the Committee to include budget 
authority for the U.S. Department of Labor (DOL) to provide additional 
workforce development programs and projects on Guam. The demand for a 
skilled and trained workforce on Guam has never been greater, and will 
increase significantly in the coming years. In my opinion, it is 
essential for the federal government and the Government of Guam to 
begin preparing now to be able to meet the labor and training 
requirements associated with this relocation of U.S. forces to Guam. 
Guam's current jobs and vocational training programs are struggling to 
provide students with the training and skills needed to compete in the 
modern workforce. A well resourced jobs training program is integral to 
creating a skilled workforce to meet the demands associated with 
increased DOD investment in Guam. Full support for job training, 
education and assistance programs is especially important during this 
time of growth for Guam. I recommend that the Committee ensure that the 
DOL is budgeted sufficiently to allow for the extension of workforce 
investment programs to Guam. I am committed to working to ensure that 
Guam's contractors, its workforce, and the island as a whole benefits 
fully from this planned investment in infrastructure improvements on 
the island. And I look forward to the day when the Department of Labor 
opens a Job Corps center on Guam.
    That Guam is a strategic asset to our national security of growing 
importance is evidenced by the planned increase in DOD investment in 
the island's bases. Guam is proud to serve the United States in this 
manner. But it is important that the federal government begin now to 
help the island prepare for this enhanced role. The Committee's support 
by means of providing budgetary headroom for the implementation of the 
findings of the Guam War Claims Review Commission and for increased 
workforce development programs and projects on Guam will go far toward 
achieving this goal. I appreciate the opportunity to submit this 
testimony for the record. Thank you for your consideration of my 
testimony.

    [The prepared statement of Ms. Castor follows:]

 Prepared Statement of Hon. Kathy Castor, a Representative in Congress 
                       From the State of Florida

    Mr. Chairman and Members of the Budget Committee, thank you for the 
opportunity to bring my concerns about the President's proposed budget 
before the Committee. As you proceed to consider the budget and the 
priorities for our nation, I want to point out the severe impacts that 
the President's proposed budget will have on our children, our elderly, 
our veterans, and on the providers who serve them.
    The President's proposed budget is a predictable political 
statement favoring the wealthiest among us, while targeting the most 
vulnerable--and particularly their health. So simply put, the White 
House favors wealth over health. The President's actions don't match 
his words. He claims to have given us a fair budget and a path toward a 
balanced budget. Those claims of balance are false, but worse, the path 
he has chosen to reduce spending lies squarely on the backs of our 
neighbors back home who have little, and now will have less. This 
budget, if adopted, would hurt a lot of folks.
    Yet many of the cuts in this budget directly reduce health care for 
children, seniors and veterans.

             (1) HEALTH CARE FOR THE MOST IN NEED--MEDICAID

    Medicaid, the program for our most needy families, is pregnant 
women, infants, and children in families earning about $25,000 a year. 
It is for foster kids, for medically needy adults, and for a lot of our 
senior citizens in nursing homes. So when you hear there are Medicaid 
cuts, I would like us to really put a face on that and say they are 
going after the most vulnerable in this country, infants, poor kids, 
foster kids and seniors in nursing homes.

               (2) HEALTH CARE FOR OUR SENIORS--MEDICARE

    The White House proposed budget will hit another vulnerable group 
of our families, our seniors. The White House proposes to cut Medicare. 
I am from Florida, and a lot of folks retire down to Florida. They have 
worked hard all their lives, and this is really one of the only 
benefits that we can give them, in addition to Social Security. So what 
the White House budget is proposing to do is ask them to pay even more. 
They are asking our hardworking doctors to take a cut as well. The 
result of cutting pay for providers is that there will be fewer avenues 
for seniors to get good medical care. You see, I want my seniors to 
have the best medical care. I want them to see the best doctors, and I 
want those good doctors to stay in the Medicare system.
    In Medicare, we must achieve savings through simplifying Medicare 
Part D, and requiring the Bush Administration to negotiate drug prices. 
In addition, we should target well documented overpayments to Medicare 
HMO managed care plans. The HMO profits are out of sight. CEO salaries 
are at skyrocketing levels.

                  (3) HEALTH CARE FOR OUR KIDS--SCHIP

    The health care cuts would also hurt our children, our kids back 
home. The State Child Health Insurance Program known as SCHIP has 
provided a bridge for families who don't qualify for Medicaid, but 
still cannot afford health insurance. This program partners with States 
and our local communities and has done a pretty good job. Instead of 
building on this success, the White House says: Even though we are 
making progress, even though we still have such tremendous needs in 
this country for children to be able to go in and see a doctor, get 
their immunizations, get some advice on how to take care of themselves, 
they say we are instead, going to cut this valuable and effective 
program.
    In the real-world, families, such as that of an old high school 
friend of mine, Nan Dorton, have to decide between providing food and 
shelter and purchasing health care for their children. Her husband has 
a job. They are provided with health insurance through his employer. 
But you know how much it costs for that family to have the kids 
covered, $700 a month. That comes to $8400 per year, an amount that can 
wreck the budget of many working families. She said it was hard to 
choose whether to put food on the table or take the kids to the doctor 
and sign them up for health insurance. She said, you live in constant 
fear of your child having to go to the hospital. Forget preventive care 
that can keep them out of a hospital.
    But then she found out about children's health insurance and 
Florida's KidCare program which is funded with SCHIP dollars. She said 
it revolutionized their lives because under these health services, they 
pay a $20-per-month co-payment for all three kids, and they don't have 
any copays for hospital visits or prescriptions. We are saving a 
tremendous amount of money because they and other children covered by 
SCHIP are not showing up in the emergency room, where the cost is 
passed on to all of us in our health insurance programs or government 
subsidies. Because those families are healthier today, we are going to 
save that money and have healthier kids ready to go to school and 
become productive.
    In sum, the priorities of the Bush budget are detached from the 
reality of American families--And I urge Congress not to balance the 
budget by cutting support for the most vulnerable, our seniors and our 
kids.
    On SCHIP we must recognize that we save when we invest in our 
children. We can also achieve savings through reducing the costly 
bureaucracy that diverts money that could go directly to care.

                  (4) HEALTH CARE FOR OUR VETERANS--VA

    There is another group hit hard in this budget. In the State of 
Florida, where I am from, we have the second highest number of veterans 
in the country, and in my district, I have the busiest VA center in the 
country, the James Haley Center, which saw over 1.5 million vets last 
year. That number is more than the population of the State of Kansas.
    The Haley VA Center serves many returning Iraq war vets injured by 
IEDs and suffering through spinal cord injuries, brain injuries. Over 
the past 10 years we have gone from 2 million visits to over 5 million 
visits. How can we say to our veterans, put your lives and health on 
the line, but by the way we are cutting the amount for your care when 
we know the need will continue to grow. This affects not only the brave 
men and women who have faced harm in Iraq and Afghanistan, but it also 
affects those who have given great service to our country in previous 
conflicts. Is this is a reflection of American values? Not where I come 
from. How can the White House send us a budget that steps back, at a 
time when the Bush-Cheney Administration is escalating the war in Iraq 
from the commitment to our veterans?

                       (5) HEALTH CARE SAFETY NET

    The White House also wants to sock it to our safety net hospitals 
Our hospital emergency rooms are required by law to all who come there. 
Have you all been to the emergency room lately, tried to get in? The 
long lines? I served as a County Commissioner prior to serving in 
Congress and the brave men and women in fire rescue who transport sick 
people to the emergency room told story after story about the ERs being 
so busy and so full, they would have to stay with the emergency patient 
in the EMS truck for hours because the emergency room was clogged.
    Despite this ongoing crisis, the Bush administration says both by 
administrative rule and through its proposed budget, that we are going 
to cut money to those hospitals. In my district alone, in the Tampa Bay 
area, the impact on Tampa General Hospital, which is a level one trauma 
center: $64 million. The great All Children's Hospital across the bay 
in Saint Petersburg: $31 million; the great St. Joseph's Hospital: 
another $20 million. Those costs will fall on those who will be denied 
health care, and will fall on those of us whose health care costs will 
have to be raised to compensate for the cuts, making it harder for many 
to afford health care. It is hard to imagine a more devastating 
approach to our health care system.
    We are a better country than that. We need to set our priorities so 
that we do not try to balance our budget on the backs of the most 
vulnerable. We can move closer to a balanced budget by rejecting such 
cuts because the very programs that the Bush administration wants to 
cut are those that provide benefits now and avoid higher costs later. I 
urge this Committee to work with all of us in this Congress to provide 
support for those programs that protect our most vulnerable citizens 
and move us toward a healthier and more productive society.

    [The prepared statement of Mr. Fossella follows:]

Prepared Statement of Hon. Vito Fossella, a Representative in Congress 
                       From the State of New York

    Thank you Chairman Spratt and Ranking Member Ryan for allowing me 
to testify before your Committee this afternoon.
    My primary area of concern with the President's Fiscal Year 2008 
budget centers on reductions in Medicare and Medicaid that could limit 
access to comprehensive medical care for seniors and low-income 
Americans. Let me begin by saying that my concern over these reductions 
does not blind me to the fact that we need to take steps to curb the 
spiraling costs of both Medicare and Medicaid to protect it for 
generations to come. However, we should not implement reforms that 
create undue burdens for patients or jeopardize the ability of doctors 
and hospitals to provide high-level care.
    Earlier this month, the Medicare Payment Advisory Commission 
(MedPac) reported that Medicare payments are not keeping pace with the 
cost of providing care to beneficiaries. In fact, they are steadily and 
increasingly falling below cost. This is unsustainable and contrary to 
the goal of providing high-quality care for our seniors. The 
Administration's proposal seeks to reign in Medicare spending by 
targeting the bedrock of Medicare's care delivery--inpatient hospitals, 
outpatient hospitals, hospices, ambulance services, skilled nursing and 
inpatient rehabilitation hospitals and home health care. By either 
reducing the update factor or flat-funding these programs, the budget 
proposal has the potential to create widespread instability in the 
program.
    In my district alone, the proposed reductions in Medicare would 
slash payments to our three hospitals by nearly $110 million over the 
next five years alone. Clearly, these cuts would lead to a reduction in 
core Medicare services and leave Staten Island and Brooklyn seniors 
without access to the quality care they need and deserve.
    Similarly, I am concerned the President's budget does not strike 
the right balance to address Medicaid's cost increases. The proposed 
cuts to Medicaid would devastate hospitals in New York City, including 
hospitals in my district.
    For instance, the President's budget proposes to eliminate federal 
Medicaid dollars for graduate medical education (GME) payments to 
hospitals. This proposal alone would cut payments to the public 
hospital system in New York City by $400 million in the first year 
alone.
    In addition, the Administration has issued a proposed regulation 
that Congress previously rejected as part of the budget. The regulation 
would restrict how states finance their Medicaid expenditures and limit 
state reimbursement for only a narrow set of costs incurred by public 
providers. If enacted, this regulation would cut millions of dollars 
from virtually every public hospital in America. New York City's public 
hospital system would lose an estimated $350 million in the first year 
alone of its implementation.
    Combined, these two proposals would drastically reduce the ability 
of the public health system in New York to continue serving our 
constituents, with the greatest negative impact hitting the uninsured. 
In total, the public hospital system in New York City would lose an 
estimated $750 million in the first year alone--and as much as $3.6 
billion over the next five years. These cuts would overwhelm and harm 
an already struggling hospital system.
    While I have reservations about several of the health care budget 
proposals, I would like to commend the President for his dedication to 
providing high-quality health care to our nation's veterans. Since 
2001, the President has increased funding for veterans medical care by 
83%; overall, the President's budget recommends an almost $11 billion 
increase over the estimated levels for FY07.
    I'd also like to take this opportunity to highlight a specific 
issue included in the President's recommendations. The President's 
budget includes additional funding to expand the national cemetery 
system. The VA currently has a threshold of 170,000 veterans within a 
75 mile radius to constitute the establishment of a national cemetery. 
The Department is conducting a study to examine the feasibility of this 
requirement and its applicability to urban and other unique areas. In 
New York City, the transportation implications of traveling as many as 
75 miles prevents many veterans from accessing the cemetery within 
their service area. I would urge the consideration of additional 
funding to expand the national cemetery system so that alternative 
factors to mileage can be considered in determining accessibility.

                              9/11 HEALTH

    Another crucial budget item for New York is the inclusion of a $25 
million place holder to provide health monitoring and treatment for 
first responders and workers suffering from 9-11-related illnesses as a 
result of their service at Ground Zero. This budget item represents the 
first time the Administration has proactively asked for money to treat 
the unsung heroes of 9/11. I commend the President for such an 
important first step.
    Many of these individuals are suffering from long-term illnesses as 
a result of inhaling Ground Zero's toxic plume. Some have even died 
from their sickness. A report released yesterday by New York City Mayor 
Michael Bloomberg revealed that 681,000 individuals are in need of 
medical monitoring, 410,000 people were ``heavily exposed'' to Ground 
Zero toxins and 30,000 responders are sick; 21,000 of them, however, do 
not have adequate health insurance.
    Importantly, the Administration personally told me the $25 million 
in the budget is a place holder. It is expected that these programs 
will need significantly more funding. In December 2005, Congresswoman 
Maloney and I successfully restored $125 million in 9-11 funding 
rescinded in the FY2006 Labor-HHS Appropriations Bill. Of that money, 
$75 million was made available to treat 9-11 illnesses for the first 
time ever. While that money was released to treatment programs last 
October, some estimates say it could dry up as early as this summer--
putting the future of critical care for our 9-11 heroes in jeopardy. 
HHS is currently developing a ``burn rate'' for the existing funding. 
Assistant Secretary Dr. Agwunobi said his task force will develop a 
cost estimate for the program from that number within weeks.
    As you develop the budget, I urge you to keep in mind the $25 
million is a starting point and any budget resolution should include a 
caveat for adding funding after the HHS estimate is completed in the 
near future. I would also like to point out that this isn't just a New 
York problem--it's a national problem. People from all over the country 
came to Ground Zero to help New York and our nation get back on their 
feet. Many are suffering the same illnesses as New York police and 
firefighters. Funding these critical programs will help those 
individuals as well.

                       HOMELAND SECURITY FUNDING

    Despite the fact that New York is the number one target for 
terrorists, the City's share of homeland security funding was slashed 
40% last year under the High Threat, High Density Urban Area Security 
Initiative (UASI).
    As a priority, we need to ensure that homeland security programs 
are adequately funded--and that this funding is directed to the cities 
that face the greatest threat. Since the creation of UASI, funding 
levels to our highest-threat areas have continually fluctuated. This is 
extremely dangerous for our national security and creates needless 
uncertainty for police departments, first responders and others to 
prepare and carry out anti-terror activities. As the House continues to 
work with the Senate to pass a bill that overhauls the homeland 
security grant program to implement more comprehensive risk-based 
funding, I strongly encourage maximum funding for UASI.
    In addition, I was pleased the President's budget proposed changing 
the state and territory guaranteed minimum funding level to 0.25% from 
0.75% of the total amount for the State Homeland Security Grant Program 
(SHSGP). This percentage change effectively endorses a shift to risk-
based funding, one of the principle recommendations of the 9/11 
Commission. While we have made progress on this issue in recent years, 
Congress should send resources to fight terrorism where they are needed 
most, not based on arbitrary formulas. I look forward to working with 
all parties to achieve this important goal.
    I want to thank you for this opportunity to offer my comments on 
the President's Fiscal Year 2008 budget. I hope you take my thoughts 
into consideration as the budget process moves forward. I look forward 
to working with you on these and other matters in the weeks ahead.

    [The prepared statement of Ms. Eddie Bernice Johnson of 
Texas follows:]

 Prepared Statement of Hon. Eddie Bernice Johnson, a Representative in 
                    Congress From the State of Texas

    I want to thank Chairman John Spratt and Ranking Member Paul Ryan, 
and their respective staffs, for their work in developing the Budget 
Resolution for Fiscal Year 2008.
    The Administration's budget fails to prioritize important social 
programs very much needed by the working poor. More specifically the 
President's budget fails to address adequately the needs of African 
Americans and other neglected minorities. It is deaf to the voices, 
concerns and needs of the poor, children and the elderly. The budget 
slights domestic priorities such as health care and education and it 
lacks progressive or visionary funding.
    The shortsightedness of the Republican budget mirrors that of its 
drafters. The unconscionable tax cuts amount to an unprecedented $2 
trillion dollars and result in a $400 billion deficit over the next 
three years. Awaiting the President when he took office in 2001 was a 
budget surplus of over $236 billion dollars. At present, the President 
can only commit to balancing the budget by 2012. And to do this he uses 
unrealistic assumptions. The Administration is consistent in 
implementing policies that will only worsen the country's economy.
    The budget lacks badly needed Alternative Minimum Tax reform and 
full funding for the Administration's military missions in Iraq and 
Afghanistan.
    This budget relies on unrealistic projections for the economy and 
underestimates this country's growing fiscal problems.
    The Republican budget proposals ignore the needs of Texans and all 
hard working Americans. It cuts Medicare by $252 billion over ten years 
and ignores improving or funding alternative heath care programs. The 
budget also cuts funding for the Department of Education by $1.5 
billion; and cuts funding for the Environmental Protection Agency by 
$509 million. It also imposes new costs on already cash-stripped 
veterans' of $4.9 billion over the next ten years.
    We must implement a budget that better understands our nation's 
transportation system as the backbone of our economy. Instead, the 
President's budget cuts the general fund portion of Mass Transit 
programs by $308 million. The budget also cuts funding for Airport 
improvements by $765 million.
    This budget is a disaster for my constituents in Texas. Two million 
Texans could see retirement benefits cut under the president's 
privatization proposal. Meanwhile, rather than help the 5.5.million 
uninsured Texans (the most in any state) the President's health care 
proposal will squeeze the Texas middle class with more costs and less 
coverage. This administration's budget includes $78 billion in Medicare 
and Medicaid cuts and billions in new premiums that threaten to 
endanger Texas' 2.5 million Medicare patients' access to needed care. 
Shortfalls in state grants for children's health care will add to the 
ranks of Texas' 1.4 million uninsured children.
    At a time when states like Texas are cutting back on funding needed 
social programs, this Administration is funding non-emergency programs 
and appropriating billions of dollars on a war that rightly belongs to 
the Iraqi people.

    [The prepared statement of Mr. Kucinich follows:]

  Prepared Statement of Hon. Dennis J. Kucinich, a Representative in 
                    Congress From the State of Ohio

    Thank you Chairman Spratt and Ranking Member Ryan for allowing me 
to testify. I represent part of Cleveland and many of its suburbs. But 
I am not here today to advocate for local funds. I am here to offer a 
new approach to resolving a national problem. This issue affects 
Cleveland to be sure, but it also drags down the economy in every other 
congressional district.
    The concern and solution I bring to you today is the decline and 
disrepair of the U.S. infrastructure system. I speak of bridges, 
highways, schools, wastewater treatment plants, drinking water systems, 
etc. Like every Member of Congress, every Member of the Committee on 
Budget can think of at least one major infrastructure project in their 
district that lacks funding. And today, I offer us all a solution. I 
propose a financing mechanism that taps the Federal Reserve as a 
financing bank to provide zero interest loans, thus greatly reducing 
the costs of infrastructure improvement.
    We all see the current crisis in our infrastructure. It is 
something we see everyday when we sit in traffic bound by orange 
barrels that line our highways. It is something that schoolchildren 
experience at their desks, crowded together under leaking roofs. And 
beachgoers experience at the sidewalk when the municipal sewer systems 
overflow. These incidents happen every year and happen with increasing 
regularity as systems age. Infrastructure problems threaten our 
productivity, our economy, our environment and our health.
    What will it take to fix these problems? Nationally, it would take 
more than $1.6 trillion to bring our country's roadways up to speed 
according to a report released in 2005 by the American Society for 
Civil Engineers. According to the American Institute of Architects, one 
in every three American public schools needs major repair. The 
Department of Education found we need $127 billion to bring schools 
nationwide into adequate conditions. And in a study by the Water 
Infrastructure Network, it would take $1.3 trillion over 20 years to 
build, operate and maintain drinking water and wastewater facilities.
    Add to those staggering sums of money the necessary funding to 
replace and repair devastated infrastructure from the Katrina disaster. 
Estimates from Risk Management Solutions (RMS), a private-sector 
company that provides services for the management of insurance 
catastrophe risk, suggest that total losses--insured and uninsured--
from both hurricanes (Katrina and Rita) approach $140 billion, the bulk 
of which is due to Hurricane Katrina.
    The people of Katrina are returning to nothing and the first task 
is to rebuild the basic infrastructure. The Center for Business and 
Economic Research at Marshall University estimated that Hurricane 
Katrina has generated commercial structure damages of $21 billion, 
commercial equipment damages of $36 billion, residential structure and 
content damages of almost $75 billion, electric utility damages of $231 
million, highway damages of $3 billion, sewer system damages of $1.2 
billion and commercial revenue losses of $4.6 billion.
    With these extraordinary needs, it is no wonder that municipalities 
have not been able to make up the difference as the federal government 
has gradually decreased infrastructure support. Putting aside all 
partisan issues, the current deficit is real and everyone agrees it 
must be reduced. That reality makes massive federal investments 
unlikely.
    My solution would create a low-cost federal financing mechanism to 
administer billions of dollars in zero-interest loans every year to 
localities for infrastructure projects. Financing costs for any project 
add substantially to the cost of the project, therefore zero interest 
loans make local dollars go significantly further. States would be 
totally responsible for choosing which projects to fund with the loans 
according to their specific needs.
    This bill would create the Federal Bank for Infrastructure 
Modernization (FBIM). The bank, as an extension of the Federal 
Financing Bank under the Treasury, would administer the loans. The 
loans would bear a small fee of one-quarter of one percent of the loan 
principle to cover the administrative costs of the FBIM.
    In order to provide the money for the loans, the FBIM would hold a 
portion of the Treasury securities that the Federal Reserve normally 
holds. By transferring billions of dollars annually to the FBIM, it 
would still allow the Fed to operate as it does now to add liquidity to 
the system. The Fed, instead of buying securities, would buy the 
mortgage loans of the states. This way, the FBIM's finances would be 
integrated by the Federal Open Market Committee so as not to disrupt 
its ability to promote economic stability.
    The actual amount could be varied so these funds could be used as a 
tool to foster stable economic growth. During times of economic 
slowdown, the FBIM could make more loans available to spur investment. 
During times of economic boom, the FBIM could make fewer loans 
available.
    The needs are so great that our old ideas just won't work. If we 
talk about the hundreds of billions of dollars needed to make 
infrastructure a workable, productive system, the sum overwhelms nearly 
every idea we've had in the past.
    The President's domestic discretionary budget is $391.7 billion. 
The needs are much greater than that. Even for certain needs, like 
school construction, we would have to spend one-third of his budget. To 
repair structurally deficient bridges, we would have to spend one-
fourth of his budget. It is unimaginable that we will fully address 
even one of these areas.
    We must be creative. We must think of ways of solving problems that 
are outside-the-box. That is exactly what this proposal is and why it 
needs the support of the Budget Committee. The Committee's backing of 
this bill reflects an understanding that our nation is asking for 
innovative, bipartisan solutions.
    The Federal Bank for Infrastructure Modernization is a tool for 
leveraging the necessary funds. Cities and states would still be 
responsible for paying the net cost of the project, but by making the 
loans zero-interest, it cuts the overall cost of the project in half. 
This is a workable solution that goes a long way in addressing 
infrastructure needs.
    I come here today to seek the support of the Budget Committee. With 
your leadership, this bill could provide the ingenuity, the essential 
boost that projects need.

    [The prepared statement of Ms. Matsui follows:]

    Prepared Statement of Hon. Doris O. Matsui, a Representative in 
                 Congress From the State of California

    Chairman Spratt, Ranking Member Ryan, and Members of the Budget 
Committee, I appreciate the opportunity to testify regarding the 
President's proposed budget for the 2008 fiscal year. As members of the 
Committee know well, the budget serves as a roadmap for the nation's 
priorities. I commend Chairman Spratt and Members of the Committee for 
their commitment to fiscal discipline and to crafting an honest and 
pragmatic budget resolution. Reinstituting Pay-Go rules was an 
important first step toward putting the nation's fiscal house in order, 
and I am optimistic that the Committee will draft a budget resolution 
that will continue on the path to fiscal discipline, while making smart 
investments for the future in areas including health care, education, 
energy research, science and the nation's infrastructure. Of course, 
resources are limited and the Committee will face difficult choices in 
the weeks ahead. Through my testimony, I hope to inform the Committee's 
deliberations as it begins the FY 08 budget process.
    In examining the President's proposed budget for FY 08, I wanted to 
share with you a few key priorities for my constituents in Sacramento. 
My top priority in Congress is protecting my district from flooding. 
Statistically, Sacramento is the single American river city most likely 
to experience a catastrophic flood in the near future, and I am 
committed to working with my partners at the federal, state, and local 
levels to ensure that our homes and communities can withstand such an 
event. From a budgetary perspective, these efforts depend on full 
funding for authorized flood protection projects in the Army Corps of 
Engineers budget. The Corps, along with the Bureau of Reclamation, 
constructs the dams and levees that are vital to the safety of my 
constituents and those in other vulnerable locations around the 
country. The President's budget funds Army Corps projects at 8.6% below 
FY 07 levels. Such a cut could potentially put key flood protection 
projects behind schedule, further endangering our constituents across 
the country. I urge the Committee to consider fully funding these 
projects in allocating resources to the Natural Resources and 
Environment budget function.
    Another program that ensures the safety of my constituents in 
Sacramento and Americans in cities across the nation is the Urban Area 
Security Initiative in the Department of Homeland Security's budget. 
The UASI grant program plays an important role in protecting our 
critical infrastructure from terrorist attacks. Congress must ensure 
that in high-risk urban areas first responders and law enforcement have 
the resources they need to protect our cities from foreign and domestic 
threats. I hope you will consider the importance of the UASI program in 
determining allocations for homeland security-related budget functions.
    In your consideration of the Health budget function, please 
consider the importance of the National Institutes of Health budget, 
particularly the National Children's Study. The National Children's 
Study follows 100,000 children from birth to age 21 to provide an 
understanding of how environmental factors affect health and disease. 
It holds the potential to provide critical answers to the root causes 
of autism, asthma, obesity, childhood diabetes, and other illnesses. It 
may also be of note to this Committee that according to the NICHD, the 
Study's benefits will save between $3.5-$5.5 billion per year in 
avoided health care costs. This single-year savings is roughly double 
the Study's cost over its more than twenty-five year period of 
research. Clearly, the National Children's Study is a key investment in 
the long term health of our nation, for our children and our children's 
children. I am concerned that the President's budget recommends 
eliminating the National Children's Study and recommends an overall NIH 
budget $210 million below the FY07 levels. The NIH is doing vital work 
in so many areas, and thorough funding for NIH will allow outstanding 
research to continue to be performed. I hope you will keep NIH and the 
National Children's Study at the top of your mind in considering the 
Health budget function.
    I would also call attention to the Corporation for National and 
Community Service. Each year, the Corporation engages more than 3.8 
million Americans in a wide array of service opportunities through its 
core programs, which include: AmeriCorps State and National, AmeriCorps 
National Civilian Community Corps (NCCC), AmeriCorps Volunteers in 
Service to America (VISTA), Learn and Serve America and Senior Corps. 
These programs help drive vital organizations like CityYear and Habitat 
for Humanity who receive grants from the Corporation every year.
    The importance of having a strong network of trained volunteers has 
never been more evident than after the devastating hurricanes in the 
Gulf Coast. In fact, since September 2005, more than 35,000 national 
service participants have provided humanitarian assistance to the 
victims of Hurricanes Katrina, Rita and Wilson and have played a 
pivotal role in the Gulf Coast's recovery efforts, helping to recruit 
and manage an additional 120,000 community volunteers. Through the 
national service programs, volunteers established and operated 
shelters, cleared debris, provided meals and social service, put tarps 
on roofs, sanitized homes, and provided hope to those uprooted and 
displaced by the storms.
    In particular, AmeriCorps*NCCC members have proven to be adept 
intermediaries between our first responders and others in the 
community. Local first responders in my district of Sacramento have 
explained that because NCCC members are 100% disaster trained and 
readily deployable, they are able to come into a situation and 
immediately assist at any level of the operation, thereby freeing up 
our first responders and law enforcement. In fact, NCCC members were 
deployed to the Gulf Coast within 24 hours of Katrina making landfall 
and continue to assist with the relief and recovery efforts.
    The Corporation needs a robust appropriation that will preserve 
this continuum of service and engage more Americans in this critical 
work. I urge the Committee to consider these programs in determining 
the Education, Training, Employment, and Social Services budget 
function so we can send a positive message to those who want to build a 
better tomorrow for those in need.
    A final priority for my constituents is moving toward a clean 
energy economy and fighting the looming threat of global warming. To do 
this, it is essential to fully fund the Department of Energy's Office 
of Energy Efficiency and Renewable Energy (EERE) in the Energy budget 
function and DOE's Office of Science in the General Science, Space and 
Technology budget function. Funding the research and development 
programs at these offices will lay the foundation for breakthrough 
technologies that have the potential to transform our energy economy 
while helping us make progress to halt global warming. While the Office 
of Science receives a sizable funding increase in the President's 
budget, the $1.24 billion request for EERE represents essentially flat 
funding relative to FY 06, a request that vastly understates the 
urgency of investing in clean energy research and development. I hope 
that energy research and development will be funded in the budget 
resolution at a level commensurate with the energy policy challenges 
facing this nation.
    Another important tool which helps reduce global warming is the 
Diesel Emissions Reduction Act (DERA). In California specifically, we 
face significant challenges related to our air quality, water supply, 
and flood vulnerability, and the initiatives authorized under DERA will 
help us combat the risks posed by polluted air, increased mountain 
runoff, and global warming. Authorized in the Energy Policy Act of 
2005, DERA encompasses a broad range of programs designed to limit 
harmful diesel emissions through engine retrofits, idling reduction 
initiatives, and a variety of grants and loans at the state and local 
levels. As such, DERA is essential to our efforts to fight global 
warming, clean the air, and protect the general population. The 
President's FY 08 Budget request provides $35 million for DERA 
programs, a sizable reduction from the FY 07 proposal of $49.5 million. 
I urge the Committee to join with the bipartisan coalition that has 
championed DERA since its inception, and help restore funding for these 
essential initiatives through the FY 08 budget resolution.
    I very much appreciate the Committee's consideration of these 
budget priorities. The deteriorating fiscal situation and the impending 
retirement of the baby boomers certainly places the Budget Committee in 
a tough position. But now is a time of opportunity when Congress can 
act on behalf of our children and grandchildren, and truly align this 
nation's priorities with those of all of the American people. I hope my 
testimony will help the Committee toward that important end. If I can 
provide further information or answer any questions, please do not 
hesitate to contact me. Thank you very much.

    [The prepared statement of Mr. Neugebauer follows:]

   Prepared Statement of Hon. Randy Neugebauer, a Representative in 
                    Congress From the State of Texas

    Maintain tax relief because of benefits of tax relief to revenue, 
economy and deficit.
    Need to support troops.
    Spending is the key: Need to hold down domestic discretionary. Need 
for reform of mandatory programs.
    We can balance this budget, and we are very close to balancing it 
now. If we were doing a better job on the spending side, we could 
balance the budget.
    Savings from 2002 Farm Bill and lower baseline for programs--ag has 
contributed to deficit reduction and need to support 2007 Farm Bill.
    Dangers of Democrat PAYGO.

    [The prepared statement of Mr. Roskam follows:]

    Prepared Statement of Hon. Peter J. Roskam, a Representative in 
                  Congress From the State of Illinois

    I applaud the Administration for making bold moves in fiscal policy 
to balance the federal budget by 2012 by maintaining successful pro-
growth economic policies, reforming entitlements, and most importantly, 
doing it without raising taxes. Spending in the President's Fiscal Year 
2008 budget proposes an average increase of 3.1% per year over the next 
5 years, a reduction from last year's average growth projection of 3.6% 
over the same period.
    Current entitlement spending puts the U.S. economy on a path to 
disaster. As Members of Congress, we must rein in wasteful spending in 
order to protect these important programs for those who need them most: 
the elderly, women and children, and the disabled. Entitlements consume 
more than half of the entire federal budget, and are projected to grow 
by nearly six percent per year--faster than the entire economy. At this 
rate, by 2040, the operating costs for these programs will equal the 
current operating costs of the entire federal government. While I do 
not agree with the Administration one hundred percent on how we should 
go about reducing the outrageously expensive cost of entitlement 
programs, I do believe that this budget sends a serious message on the 
need to reduce spending in order to sustain entitlement programs.
    I also commend the President's proposals to return tax dollars to 
the hard-working families and small businesses of my district. I 
believe we need to make permanent the tax cuts enacted in 2001 and 
2003. We need to extend AMT relief and the R&D tax credit, and work to 
keep important health care decisions in the hands of patients by 
supporting Health Savings Accounts and promoting new health deduction 
initiatives. These policies have already spurred economic growth and 
helped to create over 7.2 million new jobs.
    The State of Illinois ranks 46th in the nation for job growth, so I 
can assure you that I know firsthand the disastrous consequences of an 
economic policy agenda based on burdensome regulations and lack of 
incentives for innovation, research and development. Instead of 
continuing these stifling economic policies, I have promised to fight 
to rein in out-of-control spending, reduce the cost of entitlements, 
and maintain the tax incentives that built sustained economic growth 
and job creation since their enactment in 2001.
    Included in this testimony are thoughts on some other sections of 
the FY2008 Budget Proposal:

                               EDUCATION

    A strong education system is the backbone of our economy and 
absolutely vital to our nation's strength and growth. However, while I 
support $1 billion in additional funding for the No Child Left Behind 
(NCLB) program proposed in the FY2008 Budget Proposal, I harbor serious 
concerns that the NCLB program is not performing as well as it could 
be. As the 110th Congress looks to reauthorize this program, I plan to 
consider carefully the ways in which we can improve it. This reform 
must reduce unnecessary and ineffective red tape that hinders 
achievement in our classrooms, apply fair standards for students with 
disabilities, and emphasize the use of an individual student's 
achievement as a benchmark for improvement. As a former high school 
teacher, I know the challenges facing our education system. It is 
essential that parents, teachers, and community leaders take the lead 
role in promoting a quality education for all of our students. We can 
do our part by working to reduce bureaucratic regulation and empowering 
local leaders to provide all of our children a bright future.
    I am also pleased to see the Administration's proposal to encourage 
greater access to college for low-income students by increasing the 
Pell Grant maximum award from $4,050 to $5,400. In comparison to 
legislation the House passed a few weeks ago, which reduced interest 
rates on student loans for current college students, a Pell Grant 
increase directly addresses the issue of inequality in access to higher 
education.

                           HOMELAND SECURITY

    In reviewing the Administration's homeland security funding 
proposal I must raise some issues of concern. The reductions to the 
Urban Area Security Initiative (UASI), the Law Enforcement Terrorism 
Prevention Program (LETPP), and the State Homeland Security Grant 
Program (SHSGP) would negatively impact my constituents by potentially 
ending many terrorism prevention and coordination activities at the 
state and local level. DuPage and Cook Counties' first responders are 
working tirelessly to prevent threats to the Chicago area's many 
potential terrorist targets, and reducing their funding is simply 
unacceptable. We must provide our first responders and local law 
enforcement the tools they need to keep our families and communities 
safe.

                              HEALTH CARE

    When we discuss the need to pull in the reins on the budget, health 
care is at the top of the list. Studies have shown the more government 
involvement in health care, the higher the costs within the industry. 
Specifically, the need to reform the out-of-control growth of Medicare 
and Medicaid is a must. The Administration takes a daring move in 
tackling this uncontrollable growth to ensure sustainability of the 
health care programs which support those most in need. I am a strong 
advocate in reducing growth of essential health care programs. However, 
I would like to encourage the message of caution when the Committee is 
deciding where savings should be found. Some of the recommended policy 
cuts by the Administration, such as a reduction in the market basket 
update for inpatient and outpatient care, as well as a four-year phase-
out of reimbursement for Medicare bad debt across service types, could 
cost hospitals in Illinois up to $623 million. Specifically, Adventist 
GlenOaks Hospital, which is a large provider of the underserved and 
uninsured population in my congressional district, could potentially 
stand to lose almost $3 million. Therefore, we should proceed with good 
sense to ensure any program reductions we enact do not have unintended 
consequences on our hospitals. Unfairly saddling them to pay for 
additional uncompensated care could threaten the access to health 
services for those most in need. The hospitals in my congressional 
district directly employ over 10,000 people, paying out over $643 
million in wages and generate approximately $212 million in federal 
taxes. It is imperative to my congressional district's local economy 
that these hospitals remain financially secure to serve the community.
    While I have concerns for my hospitals, I have found a bright spot 
in the President's FY 2008 budget proposal with its' funding of $1.988 
billion for community health centers. Community health centers, such as 
the Martin T. Russo Family Health Center in Bloomingdale, IL, are 
crucial to ensuring the uninsured and low-income population has access 
to reliable, high-quality health care. Community health centers serve 
everyone, regardless of their ability to pay, in a cost-effective and 
efficient manner; all accomplished through locally-controlled patient 
boards. The health center in Bloomingdale is a member of a larger 
Chicago-based network, the ACCESS Community Health Network. One in four 
patients treated by this network is uninsured. ACCESS responsibly 
leverages its federal dollars with state and private funds, and 
partners with local hospitals to strengthen the health safety net in 
the community by promoting preventative care and keeping patients out 
of costly emergency rooms. Study after study has shown that people who 
regularly visit a health center reduce other health care expenditures 
by more than thirty percent. Further funding of this program will 
increase the availability of health care and reduce federal Medicaid 
and Medicare costs and also unnecessary emergency room visits at 
neighboring hospitals.

                             MANUFACTURING

    I am very concerned with the fifty-seven percent proposed cut to 
the Manufacturing Extension Partnership (MEP). With approximately 
140,000 of my constituents employed by the manufacturing industry, the 
retention and growth of this sector is a must. The Chicago 
Manufacturing Center (CMC) is the MEP center that serves the seven 
county Chicagoland area, which includes DuPage and Cook Counties in my 
congressional district. In 2004, CMC clients reported increases and 
retentions of $110.1 million in sales, hired 194 people for newly 
created jobs, and saved 527 jobs. With manufacturing contributing one-
third of all corporate taxes for state and local governments, the MEP 
program is vital to ensuring the economic well-being of my district.

                                 ENERGY

    The last budget issue I would like to address is energy. I was 
pleased to see the President request an increase of $73 million for the 
Department of Energy's Office of Energy Efficiency and Renewable 
Energy. It is absolutely vital that we provide additional resources and 
incentives for private sector investments to wean our economy off of 
our dangerous dependence on foreign oil and reduce emissions that 
destroy our natural environment, all without causing a loss of jobs in 
the manufacturing industry. The Gas Technology Institute in my 
Congressional district is leading the way in the quest for alternative 
and renewable energy solutions.
    Mr. Chairman and Ranking Member, thank you for the opportunity you 
have presented me today. I am hopeful the House Budget Committee will 
take into consideration my constituent's priorities and will be 
reflected in the Fiscal Year 2008 Budget Resolution that comes to the 
House Floor later this Congress.

    [The prepared statement of Mr. Sarbanes follows:]

   Prepared Statement of Hon. John P. Sarbanes, a Representative in 
                  Congress From the State of Maryland

    As the committee continues its budget deliberations for fiscal 
2008, I am writing to ask you to reject the President's assault on 
working families. Instead, we must refocus our national priorities to 
ensure that fairness, opportunity and fiscal responsibility are at the 
top of the list. Although the President's budget proposal has enormous 
deficiencies across the board, I wanted to draw your attention to a few 
specific shortcomings because of their direct impact on my 
constituents.
    My experience in the health care field has made me keenly aware of 
the shortcomings of our national health care system. It is a tragedy 
that approximately 47 million Americans have no health insurance. In 
the state of Maryland, the uninsured population has swelled to nearly 
800,000 residents, or more than 10 percent of the population.
    It is difficult to overstate the importance of federal health 
programs to underserved populations, or to state budgets. Maryland 
currently spends 18% of its general fund budget on medical assistance. 
Without fundamental changes, it is projected that Maryland will spend 
nearly one-fifth of its general fund on medical assistance by FY 2011. 
The following programs are critical to sustaining services to low 
income and uninsured populations, as well as assisting states to pay 
for medical assistance programs:
     Restore the President's cuts to Medicare and Medicaid and 
avoid reductions in benefits or increases in premiums.
     Provide sufficient funding for the SCHIP program to at 
least maintain benefits for those now receiving SCHIP and work to 
expand coverage.
    For the last eight years, I also served as special liaison to the 
Baltimore City Public School System for Maryland's State Superintendent 
of Schools. In this capacity, I worked closely with educators and 
school administrators and saw first hand the impact of inadequate 
federal funding on meeting the requirements of No Child Left Behind, 
providing a quality education for children with special needs, closing 
the achievement gap, and many other areas. We need to set the federal 
budget on a course to meet past promises:
     Move toward full funding for NCLB.
     Move toward paying the federal government's fair share of 
IDEA.
     Reconsider the President's arbitrary elimination of 
important education programs.
    Maryland is no different than many communities around America in 
that our state's critical infrastructure is in dire need of upgrade. 
During my campaign, I often talked about the need to reinvest in 
America as a means of strengthening our nation's infrastructure, but 
also as a job creator for thousands, if not millions of Americans. The 
result will be stronger communities and a more secure America.
    Where Maryland may differ, however, is that the operation of the 
federal government disproportionately strains our state's 
transportation infrastructure, schools, housing needs, and water and 
sewer capacities. The 2005 BRAC round, which is a tremendous 
opportunity, also poses an enormous challenge as Maryland's military 
facilities gain tens of thousands of new positions.
    In Maryland, we are very proud of the military installations across 
our State and we stand ready to support these facilities. There are 
several federal programs that will aid the state in preparing for these 
new incoming defense workers. This funding, to be used in coordination 
with significant state and local resources, is critical in order to 
assimilate these hard working men and women in a way that maintains the 
state's environmental integrity and is least disruptive to quality of 
life in Maryland's communities. The following programs are critical to 
achieving these goals:
     Fully fund the President's request for Base Realignment 
and Closure.
     Restore the President's cuts to the Clean Water State 
Revolving Fund.
     Increase funding for the EPA's Chesapeake Bay Program and 
other Bay cleanup efforts.
     Fully fund authorized levels for highway and mass transit 
programs.
     Provide adequate funding for Amtrak.
     Restore the President's cuts to the Community Development 
Block Grant program.
     Ensure adequate funding for the Army Corps of Engineers to 
execute important navigation and environmental projects.
     Increase funding for Impact Aid.
    Again, thank you for the opportunity to testify today. I look 
forward to working with the Committee to ensure that our Nation's 
domestic and international priorities are met in the upcoming fiscal 
year. Should you need additional information, please feel free to 
contact me or my staff.

    [The prepared statement of Ms. Solis follows:]

Prepared Statement of Hon. Hilda L. Solis, a Representative in Congress 
                      From the State of California

    Chairman Spratt and Ranking Member Ryan, thank you for allowing me 
to speak with you today to share with you my budget priorities for 
Fiscal Year 2008. I would like to start by saying that I recognize our 
difficult budget situation. The cost of the war in Iraq, coupled with 
tax cuts for the nation's wealthiest, have forced our backs against the 
wall when it comes to domestic spending. I cannot condone, however, a 
budget which continues to defer needed investment in public health 
care, the environment, and education. We must prioritize investments in 
these areas if we are to guarantee a healthy, productive future for our 
children and families.

                              HEALTH CARE

    Ensuring access to quality, affordable health care is one of the 
most important challenges we face. As the Chair of the Congressional 
Hispanic Caucus Task Force on Health and the Environment, and a member 
of the Energy and Commerce Subcommittee on Health, I am deeply 
concerned about the impact of the President's proposed budget on 
minority populations.
    More than 46 million Americans are uninsured, including more than 
one out three residents in the communities I represent in East Los 
Angeles and the San Gabriel Valley in Southern California, and 14 
million Latinos nationwide. Sixteen percent of Latino children in 
families below 300 percent of the Federal Poverty Level in Los Angeles 
County lacked health insurance for at least part of 2005. Nine million 
children, including 202,000 in Los Angeles County are uninsured. Five 
million uninsured children are from communities of color, including 3.5 
million (or one in five) Latino children.
    According to the Kaiser Family Foundation, uninsured children are 
five times less likely to have visited a doctor or dentist in the past 
two years compared to insured children. Fewer doctor visits can lead to 
serious health problems as well as costly emergency room visits.
    Yet, the budget submitted last week appears to leave our seniors 
and children with fewer choices and greater costs. First, the proposed 
budget fails to responsibly address the issue of insuring children. If 
the budget does not include additional funding to fully address the 
SCHIP shortfalls and account for growth in the program, many current 
SCHIP beneficiaries will lose their health care and the un-enrolled but 
eligible children will continue to lack coverage.
    The budget also fails to take into account the number of eligible 
but un-enrolled children in SCHIP. Seven in ten uninsured children are 
eligible for public programs such as Medi-Cal, Healthy Families, or 
Healthy Kids, but obstacles such as language and cultural barriers may 
delay or block enrollment. Federal support is needed to enroll 
uninsured eligible children, with an emphasis on linguistic and 
cultural competence.
    I urge my colleagues to consider the valuable role community health 
workers are playing across our country. Community health workers are 
bilingual, culturally competent professionals who provide a wide array 
of services, mostly to immigrant populations, such as health education, 
advocacy, and enrollment in health insurance programs. A recent report 
in the Journal of the American Academy of Pediatrics compared the 
effectiveness of community workers with traditional Medicaid and SCHIP 
outreach and enrollment. This authors of this study found that families 
who interacted with community health workers were eight times more 
likely to obtain health insurance for their children. Almost 96 percent 
of children who worked with promotoras in the study obtained health 
insurance and 78 percent were insured continuously!
    This study proves that community health workers can reduce the 
number of uninsured children. The overall cost of providing grants to 
community health workers so they can assist in ensuring children access 
health care is $24.5 million over five years--a small price given the 
large benefit health care has on children.
    As proposed, the budget neither envisions providing coverage to un-
enrolled but eligible children nor does it suggest new ways to ensure 
that those children who are eligible but uninsured are receiving needed 
care. We must ensure that our budget places a priority on children's 
health by including $60 billion over five years for SCHIP 
reauthorization and $24.5 million for outreach programs through 
community health workers.
    I am also concerned about the virtual elimination of health 
professions training programs in the budget submitted last week. These 
training programs are needed tools to ensure that our workforce 
reflects the diversity of our nation. Communities of color bear the 
brunt of the impact of the lack of health care, struggling 
disproportionately from diseases such as diabetes and obesity. Yet this 
budget fails to place a priority on culturally and linguistically 
competent care. Without health professions training, those communities 
struggling with cultural and linguistic barriers will continue to lack 
service and care needed. By supporting health professions training 
programs we are ensuring that future generations will receive 
appropriate health care and that health disparities will be reduced.
    Perhaps some of most important resources our communities have are 
our Community Health Centers. Unfortunately, the proposed budget 
targets Community Health Centers, domestic HIV/AIDS programs, and 
maternal and children's health programs by $4 billion over five years. 
I hope we can work together to support the health of our communities by 
placing making them a funding priority.

                ENSURING A HEALTHY COMMUNITY ENVIRONMENT

    Our budget must also invest in infrastructure which sustains a 
healthy community. Unfortunately, under the budget received last week, 
environmental programs such as pollution control will sustain cuts of 
$5.5 billion over five years. I find these proposed cuts, particularly 
cuts at the Environmental Protection Agency, disingenuous given the 
failure of the EPA to testify about its budget under the Bush 
Administration. I look forward to having this discussion with the 
Administrator in the coming weeks.
    Several of these cuts will have very real impacts on our nation's 
most vulnerable communities. Over the past several years the EPA has 
proposed cuts of approximately 30 percent to environmental justice 
programs and such a cut is included in the budget we received last 
week. The proposed budget cut comes on the heels of a report by the 
EPA's own Inspector General which identified the failures of the EPA to 
implement environmental justice programs, which stated that until the 
program and regional offices perform environmental justice reviews, the 
EPA ``cannot determine whether its programs cause disproportionately 
high and adverse human health or environmental effects on minority and 
low-income populations.'' Each year Congress has recognized the 
importance of protecting minority and low-income communities, and I 
hope that, like years past, we can reinstate this funding.
    I am also very concerned about the impact leaking underground 
storage tanks are having on our groundwater supplies. Underground 
storage tanks that leak petroleum or other hazardous substances can 
contaminate nearby soil and groundwater, which serves as the source of 
drinking water for nearly half of all Americans. Individuals coming 
into contact with this contamination, which can contain known 
carcinogens, could experience health programs ranging from nausea to 
kidney or liver damage. Funding for cleanup of these tanks is financed 
largely by a $.001 per gallon excise tax on gasoline and other motor 
fuels. Unlike other funds, this Trust Fund has a surplus of $2.67 
billion which should be spent to clean up the 117,000 leaking tanks. 
Unfortunately, the President's budget only requests $72.4 million for 
FY 2008, less than .005 percent of the amount available. I urge my 
colleagues to release these funds so our groundwater supplies may be 
protected, rather than holding them hostage to the deficit.
    Critical to ensuring a healthy community is ensuring clean air. 
However, the Administration's budget slashes federal funding for state 
and local air quality programs by $35 million, seriously undermining 
state and local clean air programs which are needed to protect public 
health. Proposed cuts could result in state and local agencies being 
forced to lay off staff or leave vacancies unfilled, shutting down 
existing monitors or otherwise curtailing monitoring programs. For 
communities such as the one I represent, these monitoring programs have 
been critical to protect the health of vulnerable communities, such as 
the health of the students whose elementary school playground is right 
next to an open gravel pit. The health of our communities if dependent 
upon a strong federal commitment to clean air.
    Finally, we must not ignore the needs of our low-income communities 
to afford their heating and cooling bills. The submitted budget cuts 
weatherization programs by 41 percent and assistance programs for low 
income $200 million. This budget also fails to address the 
disproportionate impact global warming will have on low-income and 
communities of color. I strongly recommend that the proposed cuts to 
weatherization programs (which are a hand up, not a hand out) and 
LIHEAP be rejected, and a strategy to address climate change includes 
tools to mitigate the impact it will have on communities of color.

               SECURING WOMEN'S HEALTH--DOMESTIC VIOLENCE

    For women throughout the United States, the foundation of their 
health is their safety. Congress' passage of the reauthorization of the 
Violence Against Women Act was one of the most important legislative 
accomplishments for women in the 109th Congress. Unfortunately, 
violence against women is still all too common in our country. Nearly 
one in every four women experiences at least one physical assault by a 
partner during adulthood. Yet, only one in every seven (14 percent) 
domestic assaults comes to the attention of police. Four out of ten 
victims of domestic violence live in households with young children, 
who most likely witness the abuse.
    For women of color and immigrant women, the effects of domestic 
violence can be exacerbated by spouses who control their immigration 
status and services that are not linguistically or culturally 
competent. I worked very hard with my colleagues throughout the long 
process of drafting VAWA to make sure that the unique needs of 
communities of color were addressed in the bill.
    Two provisions that I authored to help women of color who are 
victims of violence were included in the final version of VAWA. One of 
my provisions will provide funding for programs that educate minority 
and immigrant communities on how to prevent domestic violence and let 
them know what services are available to victims. The second provision 
I authored will help communities establish specialized domestic 
violence courts in order to expedite the processing of domestic 
violence cases. Specialized domestic violence courts have been proven 
to cut the processing time of domestic violence court cases, decrease 
the backlog of court cases, raise the conviction rate and lower the 
rate of repeat offenders. My provision will also provide funding for 
translation and interpretation services in these courts.
    We made significant improvements in VAWA 2005 for women of color 
and immigrant women who are victims of violence, and Congress must 
reinforce these provisions with increased funding. Unfortunately, the 
President's fiscal year 2008 budget proposal ignores the increased 
funding levels that Congress laid out for VAWA programs. Instead, the 
President is proposing to block grant the Department of Justice VAWA 
programs and fund them at only $370 million, an increase of barely more 
than $2 million to the overall funding for those programs. The full 
funding level authorized for VAWA programs in the Department of Justice 
for 2008 tops $600 million.
    There is also a critical need to fund VAWA programs in the 
Department of Health and Human Services that support direct services 
and prevention programs. The President's budget proposes just over $176 
million for these programs, and funding for these services has remained 
roughly level for several years, despite an increase in the number of 
victims coming forward. There are over 2,000 community-based domestic 
violence programs across the United States that provide emergency 
shelter to approximately 300,000 women and children annually, as well 
as crucial services such as counseling, legal assistance, and 
preventative education to millions of women, men, and children. These 
services and other prevention and intervention efforts are authorized 
at $320 million in VAWA 2005. Mr. Chairman, if we are really serious 
about ending violence against women in our country, then we must live 
up to the commitments made in VAWA 2005 and significantly increase 
funding for these programs.
    As the co-chair of the Congressional Caucus for Women's Issues in 
the 109th Congress, I helped lead letters to the Bush Administration 
and appropriators in the House asking that VAWA be fully funded based 
on the levels that Congress laid out in the reauthorization. At this 
time, I would like to submit for the record a letter that the Women's 
Caucus helped lead and was signed by 167 Members of Congress. This 
letter was sent in July to the Department of Justice and the Department 
of Health and Human Services asking that, in their recommendations to 
the Office of Management and the Budget, VAWA be funded at the full 
authorization levels. Unfortunately, the priorities of more than one-
third of Congress are not shared by the Bush Administration, and 
instead they have transmitted this dead-on-arrival proposal to stagnate 
VAWA funds and block grants the few funds they propose.
    I urge you to act in the best interest of women and children around 
the country who are victims of domestic violence and reject the 
President's ill-conceived VAWA block grants and his flat funding for 
VAWA programs. Women and children, including and especially immigrant 
women and communities of color, need Congress and the Bush 
Administration to fully fund the improvements made in VAWA 2005. I look 
forward to working with you and your colleagues, Mr. Chairman, as you 
craft a more sensible and balanced budget resolution that better meets 
the needs of women and children who are victims of violence.

      PROTECTING OUR CHILDREN'S FUTURE--SECURING HIGHER EDUCATION

    Education is the key to opportunity for all who live in America. 
This is particularly true for Latino and other minority and low income 
students. However, I am concerned that the President's budget 
terminates various key need-based student aid programs, such as the low 
interest Perkins Loan program, the Leveraging Educational Assistance 
Program (LEAP), and the Supplemental Educational Opportunity Grant 
(SEOG) program.
    As tuition fees at schools increase, the Administration's cuts in 
student aid will put college further out of reach for many low-income 
students. For many low income working class students, financial 
barriers are the determining factor in whether or not they will 
successfully complete college. Instead of helping allow our students 
achieve greater college access, this budget does little to close the 
college gap.

                               CONCLUSION

    Chairman Spratt, Ranking Member Ryan and Members of the Committee, 
thank you again for allowing me to speak with you today about budget 
priorities for Fiscal Year 2008. I respect the difficult task which 
lies ahead and urge my colleagues to place a strong investment in 
public health care, the environment, and education. Simply put, we must 
prioritize investments in these areas in order to guarantee a healthy, 
productive future generation.
    Thank you.

    [The prepared statement of Mr. Stupak follows:]

 Prepared Statement of Hon. Bart Stupak, a Representative in Congress 
                       From the State of Michigan

    Chairman Spratt, Ranking Member Ryan, thank you for allowing 
Members of the House to testify before the Budget Committee. I know 
that assembling a budget that meets the needs of working class 
Americans after six years of deficit spending is no simple task. I 
appreciate this opportunity to share with you my thoughts on the 
President's Fiscal Year 2008 budget request and where Congress should 
be investing more.

                               SOO LOCKS

    First, I would like to speak to a critical infrastructure project 
that the President has left out of his budget the past six years. The 
Soo Locks divide two Great Lakes: Superior and Huron. The Locks are 
made up of four locks that play a vital role in moving freight through 
the upper Great Lakes. Each year, more than 80 million tons of freight 
move through the Locks.
    As lake vessels have grown in carrying capacity and size, the 
existing large lock, the Poe, is the only one which can accommodate 
their massive frames. Two-thirds of the carrying capacity of the U.S. 
Great Lakes fleet is now limited to the Poe lock. If the Poe Lock were 
rendered unusable for any reason, it would disable industry in the 
Great Lakes, halting the shipment of ore, coal, wheat, and other 
commodities. The steel industry would be especially hard hit as 70 
percent of all raw materials used in the steel industry travel through 
the Soo Locks. This would create significant economic and homeland 
security problems. Recognizing this, in 1986, Congress authorized the 
construction of a new large lock to replace the old and outmoded Davis 
and Sabin locks.
    Despite the economic and homeland security concerns created by the 
current situation at the Soo Locks, the President continues to ignore 
the need to construct a new lock. The Administration's FY 2008 Budget 
does not contain any funding for this important construction project, 
which is estimated to cost the federal government $250 million. I am 
hopeful the Budget Committee and Congress will see the wisdom in 
funding this project appropriately this year. Every year we delay 
building a new lock, the situation becomes more dire, and the cost to 
build a new lock only increases.

                            DREDGING POLICY

    Moving to another Army Corps of Engineers issue, in 2006, the 
Administration began implementing new budget guidelines for maintenance 
dredging of commercial harbors. By using a standard based on the 
tonnage handled, harbors that do not move a large tonnage but are still 
important to the economic success of rural areas are excluded from the 
President's budget.
    These highly inadequate guidelines are unfairly biased against 
rural communities and will have a detrimental effect on small-town, 
rural America, causing job losses, increased hardship for businesses, 
and endanger shipping infrastructure. In setting this policy, the Corps 
also disregards the fact that approximately two-thirds of all shipping 
in the United States either starts or finishes at small ports.
    During House consideration of H.R. 2864, the U.S. House of 
Representatives' WRDA bill, I offered an amendment requiring the Corps 
to eliminate this tonnage standard. While the amendment was included, 
Congress did not complete work on the WRDA bill before the end of the 
109th Congress. As a result, the President's FY 2008 Budget continues 
to discriminate against commercial harbors in rural communities.

                    CLEAN WATER STATE REVOLVING FUND

    I would like to turn to another budget item of interest to rural 
communities: the Clean Water State Revolving Fund. Across the country, 
communities are struggling to replace aging waste water infrastructure. 
The Clean Water State Revolving Fund plays an important role in helping 
communities afford updates to their aging infrastructure. 
Unfortunately, President Bush has repeatedly slashed funding for this 
program in his budgets.
    The President's FY 2008 budget includes only $688 million for the 
Clean Water State Revolving Fund, a $200 million cut compared to FY2006 
and nearly a $400 million cut compared to the $1.08 billion Democrats 
included in the FY2007 CR. In Michigan, the President's cuts would mean 
$8.5 million less for important waste water infrastructure projects 
compared to FY2006. If the President's proposal is enacted, Michigan 
would receive $28.4 million less in FY 2008 than the state received in 
FY 2001. We need to invest in our waste water infrastructure, to ensure 
the health of the Great Lakes, which is the source of drinking water 
for 30 million people.

                       PAYMENTS IN LIEU OF TAXES

    Another important program the President repeatedly under funds is 
the Payment in Lieu of Taxes, or PILT, program. National Forests, as 
well as other federal lands, lead to a reduced tax base in several 
Northern Michigan counties. The Payment in Lieu of Taxes (PILT) program 
is important in helping these local communities afford schools, roads, 
fire fighting, police, and other vital services.
    In his FY 2007 and FY 2008 budget requests, President Bush has 
neglected this important program, requesting significantly less than 
needed. In FY 2007, the President requested only $198 million, a 15 
percent decrease compared to FY 2006. In FY 2008, the President has 
proposed an even larger cut, requesting only $190 million. This $43 
million cut will significantly limit the ability of local governments 
in Northern Michigan to provide the basic services residents depend on.

                                  TAA

    In addition to federal programs to help communities make 
infrastructure improvements, the President's budget cuts important job 
training and education programs helping to revitalize our economy. One 
very important program is Trade Adjustment Assistance. The TAA program 
provides workers negatively impacted by trade with job retraining, job 
search and relocation allowances, income support and other reemployment 
services.
    Unfortunately, too often communities in my district have run out of 
TAA funding. I have repeatedly contacted the Department of Labor to 
assist the State of Michigan in receiving supplemental funds. Despite 
the shortfalls repeatedly faced by Michigan and other areas, the 
President has requested flat funding for the TAA training program the 
last three years, requesting $260 million again for 2008. At a minimum, 
we owe our workers adversely affected by this country's trade policy, 
or lack thereof, adequate job training.

                                  MEP

    Similarly, we owe our small businesses who are competing globally a 
fair shake.
    I urge the committee to adequately fund the Manufacturer Extension 
Partnership (MEP) program. I don't know what Congress needs to do to 
make the Administration understand the importance of this program to 
our small manufacturers. I hope this is an issue the budget committee 
can address in your budget hearings with the administration, and I 
respectfully ask you to provide a needed increase for this program.
    I would now like to turn to health and education priorities that 
deserve Committee consideration.

                 BJ STUPAK OLYMPIC SCHOLARSHIP PROGRAM

    The Olympic Scholarship Program was established by Congress in 
1992. I have championed it since it was created, and offered an 
amendment to re-authorize it in 1998. It was subsequently re-named the 
BJ Stupak Olympic Scholarship Program after my late son.
    The B.J. Stupak Olympic Scholarship Program is a federally-funded 
scholarship program designed to provide financial assistance to college 
athletes training at any of the four U.S. Olympic training centers: the 
U.S. Olympic Education Center in Marquette, Michigan; and the Olympic 
Training Centers at Lake Placid, New York; Colorado Springs, Colorado; 
and Chula Vista, California, outside of San Diego. The Program is 
designed to allow athletes to pursue their post-secondary education 
while also training for the Olympics.
    Prior to 1992, too many athletes had to choose between pursuing 
their education and training for the Olympics. All too often, athletes 
chose training and then found themselves at the end of their Olympic 
careers with no post-secondary education and no career path.
    This problem was so severe that the U.S. Olympic Alumni Association 
identified it as a cause of great concern. Our Olympic athletes' plight 
was in stark contrast with many collegiate athletes, who received 
college and university scholarships because of their athletic skills.
    The Program was re-authorized in 1998 for five years at up to $5 
million per year, under Section 836 of the Higher Education Act of 
1998. Due to the success of the program, the growth of the program has 
outgrown its $1 million appropriations allocation the last six years. 
Without an increase for inflation, the number of athletes receiving 
scholarships will have to be substantially cut.

                              RURAL HEALTH

    Rural hospitals and other health facilities are economic engines 
for rural communities as they provide hundreds of good paying jobs. 
Quality health care is also essential to keeping businesses and 
attracting new businesses to rural America.
    The Rural Hospital Flexibility Grants fund quality improvement and 
emergency medical service projects for nearly 1,300 Critical Access 
Hospitals across the Country. In essence, this program provides 
technical assistance to the smallest hospitals in the Country who 
provide critical care.
    This program helps hospitals improve their business operations, 
focus on quality improvement and help information privacy. The 
President's budget eliminates this vital program. The National Rural 
Health Association is requesting $49.2 million, and I am hopeful 
Congress can see fit this program is adequately funded in 2008.
    I wanted to highlight this program in particular, but I also want 
to express my strong support for adequately funding the other health 
care access programs within the Department of Health and Human 
Services.

                           HOMELAND SECURITY

    Our job in Congress is to promote the health and welfare of our 
citizens. But we have no higher job than to keep our citizens safe. I'm 
gravely concerned about the 42 percent cut to first responder funding 
at the Department of Homeland Security, adding up to a $985 million cut 
to first responder grants and state assistance. As a former law 
enforcement officer and a co-chair of the Law Enforcement Caucus, I 
hear every day from local police and firefighters. This budget is an 
insult to them!
    These individuals are on the front lines in responding to natural 
disasters and protecting our nation from terrorism and crime. We need 
to support them in their efforts.
    Instead, the President's budget cuts over $1 billion from critical 
programs--$338 million from State Homeland Security Grants, $112 
million from Law Enforcement Terrorism Prevention Grants, $362 million 
from Assistance for Firefighters, and over $680 million from COPS and 
Byrne. Congress should reject these cuts, especially in light of the 
recently-passed Democratic 9/11 Commission Implementation bill, which 
re-affirmed the critical importance of first responders in preventing 
terrorism.
    All of these local first responder programs are success stories, 
and all of them are essential to the ability of local first responders 
to keep our communities and our nation safe. Congress needs to begin 
reversing this disturbing trend of cutting first responder funding, in 
all areas, but particularly in the area of first responder 
communications.

                      INTEROPERABILITY TRUST FUND

    I would like to highlight one new program that many members of this 
committee may not be aware of. As part of the Deficit Reduction Act of 
2005, Congress mandated that a section of very valuable spectrum, or 
public airwaves, be auctioned off at the end of 2007. This spectrum is 
worth billions of dollars. The CBO estimated $10 billion. But I can 
assure you the industry knows that spectrum will be auctioned off for 
at least twice as much.
    Congress had a choice then about whether to use those proceeds to 
fund interoperable communications for our first responders or tax cuts 
for millionaires. You know what past Congresses have chosen.
    On a tie-vote, an amendment I offered in Committee to create a $5.8 
billion grant program, was defeated. My amendment would have made a 
down payment on what is estimated to be an $18 billion problem. 
Ultimately, a $1 billion grant program was created. This is a one-time 
$1 billion grant program, with grants to be awarded this fall.
    I have legislation to make a permanent grant program at NTIA and 
fund that program with a portion of spectrum proceeds. We should solve 
this problem once and for all. How many more September 11th and 
Katrinas do we have to endure before our first responders can 
effectively communicate and do their jobs?
    Now, I know we are in a difficult fiscal situation. But, as I said 
this spectrum that we are auctioning this year is worth $20 billion. 
The CBO estimated it was worth $10 billion. This is the time to use 
those dollars to adequately equip our first responders.

                          FEDERAL COURT HOUSES

    I would like to move to another security concern. I also ask that 
the Committee consider increasing funding for courthouse construction 
activities funded through the Federal Building Fund (FBF).
    There are dozens of federal courthouses across the nation in urgent 
need of renovation or replacement. Some of these facilities have not 
been significantly updated in more than half a century. These outdated 
courthouses not only interfere with the federal judicial process; in 
some cases, major security problems put federal judges and employees at 
risk on a daily basis.
    In 1997, The Judicial Conference of the United States identified 
and prioritized 45 courthouse construction projects to be funded by 
Congress. This plan aimed to clear the courthouse backlog by 2009. 
However, under-funding has repeatedly stalled this effort. The 
President's budget provides only $47 million for FY2008--enough to fund 
only one of the dozens of courthouse projects currently needing 
attention.
    I ask that the Committee fund courthouse construction efforts at 
the full amount requested by the Judicial Conference of the United 
States. The problem of outdated federal courts has been ignored for too 
long. Courthouse modernization is essential to the safety of federal 
judges and court officers, and should be a high priority of this 
Congress.
    I have been a strong advocate for investing in courthouse 
construction because my district's federal courthouse in Marquette, MI, 
urgently needs to be replaced. The Marquette Courthouse is over 70 
years old and lacks adequate security, making it unsafe for Court 
employees and the public.
    Thank you again for this opportunity to testify before your 
committee today. I am happy to take questions.

    [Whereupon, at 6:41 p.m., the Committee was adjourned.]

                                  
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