[Senate Hearing 110-329]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 110-329
 
  COMMERCE, JUSTICE, SCIENCE, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2008

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

                                HEARINGS

                                before a

                          SUBCOMMITTEE OF THE

            COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                                   on

                           H.R. 3093/S. 1745

   AN ACT MAKING APPROPRIATIONS FOR THE DEPARTMENTS OF COMMERCE AND 
   JUSTICE, SCIENCE, AND RELATED AGENCIES FOR THE FISCAL YEAR ENDING 
               SEPTEMBER 30, 2008, AND FOR OTHER PURPOSES

                               __________


                        Department of Commerce
                         Department of Justice
                Equal Employment Opportunity Commission
             National Aeronautics and Space Administration
                      National Science Foundation
                       Nondepartmental Witnesses

                               __________

         Printed for the use of the Committee on Appropriations


  Available via the World Wide Web: http://www.gpoaccess.gov/congress/
                               index.html

                               __________


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                      COMMITTEE ON APPROPRIATIONS

                ROBERT C. BYRD, West Virginia, Chairman
DANIEL K. INOUYE, Hawaii             THAD COCHRAN, Mississippi
PATRICK J. LEAHY, Vermont            TED STEVENS, Alaska
TOM HARKIN, Iowa                     ARLEN SPECTER, Pennsylvania
BARBARA A. MIKULSKI, Maryland        PETE V. DOMENICI, New Mexico
HERB KOHL, Wisconsin                 CHRISTOPHER S. BOND, Missouri
PATTY MURRAY, Washington             MITCH McCONNELL, Kentucky
BYRON L. DORGAN, North Dakota        RICHARD C. SHELBY, Alabama
DIANNE FEINSTEIN, California         JUDD GREGG, New Hampshire
RICHARD J. DURBIN, Illinois          ROBERT F. BENNETT, Utah
TIM JOHNSON, South Dakota            LARRY CRAIG, Idaho
MARY L. LANDRIEU, Louisiana          KAY BAILEY HUTCHISON, Texas
JACK REED, Rhode Island              SAM BROWNBACK, Kansas
FRANK R. LAUTENBERG, New Jersey      WAYNE ALLARD, Colorado
BEN NELSON, Nebraska                 LAMAR ALEXANDER, Tennessee

                    Charles Kieffer, Staff Director
                  Bruce Evans, Minority Staff Director
                                 ------                                

    Subcommittee on Commerce, Justice, Science, and Related Agencies

                BARBARA A. MIKULSKI, Maryland, Chairman
DANIEL K. INOUYE, Hawaii             RICHARD C. SHELBY, Alabama
PATRICK J. LEAHY, Vermont            JUDD GREGG, New Hampshire
HERB KOHL, Wisconsin                 TED STEVENS, Alaska
TOM HARKIN, Iowa                     PETE V. DOMENICI, New Mexico
BYRON L. DORGAN, North Dakota        MITCH McCONNELL, Kentucky
DIANNE FEINSTEIN, California         KAY BAILEY HUTCHISON, Texas
JACK REED, Rhode Island              SAM BROWNBACK, Kansas
FRANK R. LAUTENBERG, New Jersey      LAMAR ALEXANDER, Tennessee
ROBERT C. BYRD, West Virginia (ex    THAD COCHRAN, Mississippi (ex 
    officio)                             officio)

                           Professional Staff
                            Gabrielle Batkin
                             Erin Corcoran
                             Kevin Kimball
                             Douglas Disrud
                         Art Cameron (Minority)
                        Allen Cutler (Minority)
                       Goodloe Sutton (Minority)
                       Augusta Wilson (Minority)

                         Administrative Support
                              Robert Rich

























                            C O N T E N T S

                              ----------                              

                        Thursday, March 1, 2007

                                                                   Page
Department of Commerce:
    Office of the Secretary......................................     1
    National Institute of Standards and Technology...............    32
    U.S. Patent and Trademark Office.............................    40

                        Thursday, March 8, 2007

Department of Commerce: National Oceanic and Atmospheric 
  Administra- 
  tion...........................................................   117
National Science Foundation......................................   131

                        Thursday, March 15, 2007

National Aeronautics and Space Administration....................   161

                        Thursday, April 19, 2007

Department of Justice:
    Bureau of Alcohol, Tobacco, Firearms and Explosives..........   197
    Drug Enforcement Administration..............................   209
    United States Marshals Service...............................   226

                        Thursday, April 26, 2007

Department of Justice: Federal Bureau of Investigation...........   295

                         Thursday, May 3, 2007

Equal Employment Opportunity Commission..........................   343
Nondepartmental Witnesses........................................   381



















  COMMERCE, JUSTICE, SCIENCE, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2008

                              ----------                              


                        THURSDAY, MARCH 1, 2007

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Barbara A. Mikulski (chairman) 
presiding.
    Present: Senators Mikulski, Kohl, Reed, Shelby, and 
Alexander.

                         DEPARTMENT OF COMMERCE

                        Office of the Secretary

STATEMENT OF THE HONORABLE CARLOS M. GUTIERREZ, 
            SECRETARY


            opening statement of senator barbara a. mikulski


    Senator Mikulski. Good morning, the Subcommittee on 
Commerce, Justice, Science, and Related Agencies will come to 
order. This is the first time in 13 years that I assume the 
chair of this subcommittee, and it's a great honor, and it's a 
bit of an emotional moment.
    In 1994, the power transferred to the other party, and in 
those 13 years, much has changed. Our economy has certainly 
changed, the challenges to our country have certainly changed, 
the jurisdiction and scope of this subcommittee has expanded.
    The one thing that will not change, is the enduring spirit 
of bipartisanship that has always been characteristic of this 
subcommittee, working as I did at VA/HUD, with Senator Bond, 
and last year with my esteemed colleague, Senator Shelby. We 
see ourselves as a partnership, on promoting what is right, and 
so this sense of cordiality, consultation, and civility will 
continue to be an enduring principle of this subcommittee.
    Just to outline a few of the priorities for this year, this 
subcommittee will focus on innovation, security, and 
accountability. When I look at the agencies in our 
jurisdiction, I see tremendous opportunities to promote 
innovation that creates jobs in our own country, makes our 
community more secure, while assuring accountability for the 
stewardship of the taxpayers.
    The funding that this subcommittee puts in the Federal 
checkbook, must meet the mission and mandate of each agency, 
and make a down payment on its priorities. The Commerce, 
Justice, Science Subcommittee is the innovation subcommittee. 
If America is going to be more competitive, we need to focus on 
funding and policies to develop new technologies, that lead to 
new products and new industries that create new jobs.
    It is not the role of this subcommittee to pick winners and 
losers. We are not an industry-controlled society. But it is to 
provide the basic and applied research that results in these 
new products and technology, and our agencies set the policies 
that will make sure that we have an innovation-friendly 
government.
    Over the next several weeks, we will initially focus on 
innovation. Then we will go to both Federal Bureau of 
Investigation (FBI) and law enforcement to focus on security. 
Underlying in all of the hearings will be questions related to 
accountability, and our stewardship of taxpayers dollars.
    We're looking at the National Science Foundation (NSF) that 
funds promising research and cultivates the next generation of 
science and engineers, particularly at the graduate level. The 
National Institute of Standards and Technology (NIST), that 
we're going to hear from later today, that funds new 
technologies, to make us more competitive. And, by the way, 
they win Nobel Prizes, too.
    The science at the National Aeronautics and Space 
Administration (NASA) and the National Oceanic and Atmospheric 
Administration (NOAA) help us better understand our planet and 
provides the scientific building blocks for innovation. Nothing 
gets kids more interested in science, like exploration and 
discovery in outer space, and the inner space in the ocean.
    We want to make sure, though, this--we have an innovation-
friendly government. NIST sets measurements and standards that 
the private sector can rely on, and the world counts on. The 
U.S. Patent and Trademark Office protects our intellectual 
property, and the International Trade Administration (ITA) 
enforces our trade agreements.
    We also will be focusing on security, but that's for 
another day. This subcommittee will also be looking at 
accountability in terms of the expenditure of taxpayers 
dollars, and to make sure that, whether it's waste, or abuse, 
or poor performance, will not be tolerated. But today, we're 
going to kick off our innovation hearing with the Secretary of 
the Commerce Department, a long-advocate for America's role in 
international trade, promoting competitiveness, and encouraging 
innovation and technology.
    Later on, in the second panel, we'll be hearing from the 
Director of the National Institute of Standards and Technology 
and also the Director of the Patent Office.
    Today, I will want to know how the budget meets the 
Department of Commerce mission to foster, serve, and promote 
the Nation's economy, which is a little bit rockin' and rollin' 
today, but again, you know, we're a country of institutions, 
and innovation. I want to know how the budget will promote the 
mission, and how the Commerce Department will improve 
accountability.
    In the accountability areas, the three flashing lights we 
have are, the NOAA satellite program, also some issues that--
the Patent Office, that I will raise from there, and also the 
managing of the 2010 census.
    But, today, we're very pleased to have the Secretary of 
Commerce, we want to hear what he has to say, we've enjoyed 
such a cordial relationship. He has been the President's link 
to the business community here, and to the growing 
international markets. So, we welcome him, and with that 
statement, I turn to my colleague, ranking member and, 
essentially, vice chairman, Senator Shelby.


                 statement of senator richard c. shelby


    Senator Shelby. Thank you, Senator Mikulski.
    As Senator Mikulski said, we've worked extremely well 
together, sharing many of the same goals and the expectations 
of the agencies that we oversee. We go back to our House days 
on the Energy and Commerce Committee, seems like yesterday, but 
it was more than that, I think Senator Mikulski would note.
    But I'm--Senator Mikulski, I'm pleased to serve beside you, 
once again on this subcommittee. I served as chairman, and now 
I serve as ranking, and you as chairman. Perhaps that'll change 
someday, but until it does change, we'll be working together 
either way.
    Today, I also welcome the Secretary of Commerce before the 
subcommittee as well as Dr. Jeffrey and Mr. Dudas. I look 
forward to learning more about how the 2008 budget request will 
improve the Department of Commerce, many important activities. 
The Nation, Mr. Secretary, relies heavily on the Department of 
Commerce that you head up, to maintain America's 
competitiveness within today's foreign marketplace, and to 
promote and to expand our international trade agreements.
    Through the programs of the Department of Commerce, the 
country is able to maintain high technical standards, as well 
as staying on the cutting edge of scientific research, all of 
which are fundamental, Mr. Secretary, to our Nation's 
leadership in the global market. You know this well.
    Overall, the Department of Commerce's budget request for 
2008 is $6.5 billion. This is an increase of $90.4 million from 
the funding level provided in the joint resolution for fiscal 
year 2007.
    Mr. Secretary, at this time, I want to also compliment you 
on how well your Department, through NOAA, continue to perform 
along the gulf coast in the wake of the devastating 2005 
hurricane season. Last year, the committee appropriated $150 
million in emergency supplemental funding through the 
Department to aid recovery efforts, which you needed. A portion 
of these funds went toward locating--and removing--marine 
debris deposited by the hurricanes. Fishing snags, and 
navigational hazards that halted maritime commerce, and pose a 
threat to the fishing industry of being removed.
    I've seen the images of salvage wreckage, which include 
fuel storage tanks, large trees, and even sunken barges. NOAA, 
with the help of partner agencies, is quickly and efficiently 
clearing obstructed shipping channels and fishing grounds, 
making the area safer, which is vital to the economies of 
Mississippi, Louisiana, and of course, my State of Alabama.
    I share Senator Mikulski's expectations for the Department 
of Commerce, particularly her emphasis on accountability. We 
have to be accountable. We will continue to monitor how the 
Department strengthens, and improves computer security to 
protect sensitive agency information, and we will continue our 
scrutiny on cost overruns and schedule delays which negatively 
impact NOAA's satellite program.
    The Department's request includes $1.2 billion for the 
Census Bureau, which--with nearly one-half of these funds 
directed toward the anticipation of the 2000 census--all comes 
under your jurisdiction.
    The decennial census, and the comprehensive collection of 
other surveys makes the Census Bureau a provider of fundamental 
data to Federal, State, and local governments, financial 
markets, and the public. These data sets are collected from a 
wide variety of sources, including businesses and citizens. 
Public trust, Mr. Secretary, in the security and 
confidentiality of this information is absolutely critical to 
the accuracy and the validity of the vital statistics published 
by your agency.
    There have been recent problems with the Department of 
Commerce and other Government agencies, of not having adequate 
security measures in place to protect personal data. Less than 
3 weeks ago, in my home State, Birmingham, Alabama, the 
Alabama--the Veterans Administration's employee laptop was 
stolen, it's all been in the news. It contained hundreds of 
thousands of records of personal information belonging to 
veterans. This is not under your jurisdiction, I know, but this 
is an incident, and that's unacceptable.
    I cannot emphasize how critical it is that the data be 
secure. The Census relies upon information from people 
divulging this data, and public trust in the security and 
confidentiality of the information being provided is absolutely 
crucial to the accuracy and validity of the vital statistics 
published by your agencies.
    The Department must never lose sight of the duty to protect 
the information it collects. I'm pleased to see the American 
Competitiveness Initiative, or ACI, has continued to receive 
support from the administration, through the National Institute 
of Standards and Technology budget request. ACI will keep the 
competitive edge that our Nation expects in the world economy 
through research and innovation, by focusing on the ingenuity 
of our people, and tying our capabilities to policies that will 
keep us at the forefront of scientific and technical 
advancement for generations to come.
    The collaboration of NIST and industry and academia is an 
excellent example of how this country can take advantage of 
these resources, and remain competitive in an increasingly 
challenging world. I believe that such collaboration can be 
seen in my home State of Alabama. NIST working with the 
University of Alabama at Birmingham is in early developmental 
stages for standards in research related to medical devices, 
for example. Such collaborations combine the expertise of our 
world-class research universities, with the needs of our 
Nation, and the end result is innovation and creative problem 
solving.
    I look forward to Dr. Jeffrey's testimony on how the work 
in NIST will continue to ensure the Nation's competitive edge.
    Mr. Secretary, I will also be interested in your comments 
about the rationale to exclude NOAA from ACI, something that I 
believe is a mistake. It seems logical to me that NOAA's vast 
research capabilities be utilized in these efforts. The 
strength of America's economy rests on our ability to innovate 
and to use the latest in technology, to solve the problems of 
today and preserve our economic and scientific leadership in 
the future.
    Certainly the activities of both NIST and NOAA will work to 
keep the Nation competitive, and inspire the next generation of 
scientists and researchers. I hope to learn more today, from 
Mr. Dudas, about how the U.S. Patent and Trademark Office 
intends to further protect American businesses in 2008 from 
theft and piracy.
    Intellectual property rights and its associated 
enforcement, continue to have an important impact on 
international trade, and the U.S. economy. Intellectual 
property-based industries in this country are one of the 
largest exporters in the global economy, as you know.
    Protecting the value of these rights is critical if we, as 
a Nation, are to continue being a world leader in innovation. 
Piracy of those rights costs the American economy and the 
American workers tens of billions of dollars each year.
    Mr. Secretary, we look forward to your testimony, and we 
appreciate your appearance here today.
    Senator Mikulski. Thank you very much, Senator Shelby.
    Just in terms of the rules of the subcommittee, we're going 
to recognize people in their order of arrival. And, if they 
have opening statements, we will put them in the record, or we 
ask that they incorporate them in their early questions, so we 
can move to the Secretary, and move to your questions.
    Mr. Secretary, would you proceed, and then we'll go to 
questions?
    Mr. Gutierrez. Thank you.
    Madam Chairman, and Senator Shelby and members of the 
subcommittee, I'm pleased to present President Bush's fiscal 
2008 $6.55 billion budget request for the Commerce Department. 
With your permission, I'd like to briefly discuss some key 
elements of our budget and programs, and submit my written 
testimony for the record.
    We believe this is a very disciplined budget. It is focused 
on the best use of taxpayer resources to advance America's 
economic and innovative leadership in an increasingly 
competitive world. So, we've had to make some choices regarding 
where we allocate the increases, and where we focus our time.
    Among the highlights of the increases are, $338 million for 
the Census Bureau to ramp up for 2010, and reevaluate data 
collection programs; $69 million for the National Institute of 
Standards and Technology to implement the second year of the 
President's American competitiveness initiative, and $123 
million for NOAA administration--for NOAA to fund high-priority 
oceans projects.
    Every agency in the Commerce Department is charged with the 
same critical mission--to promote American innovation and 
competitiveness, to create economic opportunities, and to 
improve the lives of the American people.
    I'd like to do something a little different this time, 
Madam Chairman, and that is to illustrate how Commerce agencies 
are fulfilling the mandate by developing, protecting, 
promoting, and strategically using innovative technologies, 
such as the global position system (GPS). I brought some 
examples here to show how new technology can be transferred to 
different bureaus within the agency, and I think it's also 
representative of how one technology for one given industry can 
be used in many industries around the country.
    As you know, the global positioning system technology is 
now so advanced, the device is as small as this cell phone. I 
actually have a GPS incorporated into the cell phone. GPS has 
multiple applications--the technology is used by governments, 
businesses, and individuals.
    The world's first atomic clock, which is the key innovation 
that enables GPS to work, was invented by scientists at the 
National Institute of Standards and Technology. This digital 
clock here, which is always exactly on time, contains 
technology that synchronizes with the NIST atomic clock. Its 
timing is extremely accurate, and it can adjust automatically 
for changes in daylight savings time.
    NIST is now pioneering new approaches to atomic 
timekeeping, such as the chip-scale atomic clock. We expect 
that chip-scale atomic clocks will soon be used in GPS 
receivers, cell phones, and other portable electronic devices, 
to greatly improve performance.
    Last year alone, the U.S. Patent and Trademark Office 
issued over 800 GPS-related patents. The Census Bureau is 
adopting GPS technology to collect street coordinates, and 
create a more accurate database for field personnel. It will be 
incorporating GPS-equipped handheld computers like this one 
into data collection operations during the 2010 census, to 
improve productivity, and reduce errors. Just as a matter of 
illustrating how advanced this is, in my previous role, our 
sales force had laptop computers, but they were very heavy, and 
very cumbersome. I find it today, it's actually quite light and 
very easy to hold up, so we continue to make great advances in 
this technology.
    Senator Mikulski. Excuse me, Mr. Secretary, that's what the 
census takers are going to have?
    Mr. Gutierrez. Yes.
    Senator Mikulski. So everything will--go ahead.
    Mr. Gutierrez. That's right. Whatever doesn't get sent 
through the mail, will be followed up using this handheld 
device. To get into it, they actually use their thumb, that 
protects the device from anyone else wanting to use it.
    Senator Mikulski. Could you, tell us then, what are the 
security measures? Because, we're not America's snoop, we're 
America's census takers.
    Mr. Gutierrez. Right.
    Senator Mikulski. How would it protect personal 
information?
    Mr. Gutierrez. Yes. This essentially will have a password 
and probably the most accurate device, which is a thumbprint 
for the specific enumerator.
    And if you'd like, I'll pass this onto you so you can take 
a look, why don't you just go ahead and give it to them. Thank 
you.
    Additionally, NOAA has created a network of GPS-tracking 
stations that makes available to the public minute measurements 
that are used to establish real estate boundaries, position 
bridges and roads, and do other geo-spatial work.
    The International Trade Administration (ITA) is working to 
remove trade barriers to increase export sales of innovative 
U.S. GPS technology, with NOAA and the National 
Telecommunications and Information Administration (NTIA). ITA 
is also taking the lead to ensure a level playing field for 
U.S. GPS manufacturers, as Europe enters the satellite 
navigation market.
    The Bureau of Industry and Security continues to monitor 
and control dual-use GPS technology, and export sales, to 
protect our national security while ensuring that America's GPS 
industry has access to open markets.
    Measuring the impact of our economy, of innovative R&D, and 
technologies like GPS to reflect new, 21st century realities, 
is now the subject of research by our Economics and Statistics 
Administration (ESA), in coordination with the private sector. 
This is an example of how we're thinking about technology, and 
an example of what we believe is success, to develop one 
technology that can be transferred quickly across many 
industries, so we can get the benefit across our economy.
    Madam Chairman, I use this GPS example to tell the story of 
the Commerce Department commitment to providing America's 
industries and workers with the services and tools needed to 
continue to make this the most competitive country in the 
world.
    The President's fiscal 2008 budget request for the 
Department is reflective of this commitment and more 
importantly, this commitment is behind where we have made 
decisions to allocate budget funds. It is carefully targeted to 
programs necessary to maintain our competitive edge in this 
very intense economy.


                           prepared statement


    I look forward to working with you to achieve this 
important goal, I thank you for giving me this opportunity to 
discuss the President's budget, and the role of the Commerce 
Department in advancing our Nation's economic strength. I feel 
very privileged to be able to represent the Department and the 
President at this very critical time in our history, and I'd be 
pleased to hear your comments and take any questions, thank 
you.
    [The statement follows:]

             Prepared Statement of Hon. Carlos M. Gutierrez

    Madam Chairman and members of the subcommittee, I am pleased to 
appear before you today to present the President's budget request for 
the Department of Commerce. Our request of $6.55 billion in 
discretionary funds reflects a balance between the administration's 
commitment to promote and sustain economic growth, and the need to 
restrain discretionary Federal spending. Enactment of this budget will 
enable the Department to continue to support the innovative and 
entrepreneurial spirit of America and increase our competitiveness in 
the international marketplace.
    The President's fiscal year 2008 budget request of $3.82 billion 
for the National Oceanic and Atmospheric Administration (NOAA) reflects 
the administration's commitment to environmental stewardship. NOAA 
encompasses the National Weather Service, which provides critical 
observations, forecasts and warnings; the National Environmental 
Satellite, Data and Information Service, which provides timely global 
environmental satellite data; the National Marine Fisheries Service, 
which provides stewardship of the Nation's living marine resources and 
their habitat; the National Ocean Service, which measures and predicts 
coastal and ocean phenomena; the Office of Oceanic and Atmospheric 
Research, which provides research for understanding weather, climate, 
and ocean and coastal resources; and the Office of Marine and Aviation 
Operations, which operates a variety of aircraft and ships providing 
specialized support for NOAA's environmental and scientific missions.
    This budget request includes increases of $123 million for projects 
that will advance ocean science and research, protect and restore 
sensitive marine and coastal areas and ensure sustainable use of ocean 
resources. These initiatives will further the administration's 
commitment to make our oceans, coasts and Great Lakes cleaner, 
healthier and more productive, as reflected in the U.S. Ocean Action 
Plan and creation of a Cabinet-level Committee on Ocean Policy.
    The increases for ocean science and research include $20 million to 
implement the Ocean Research Priorities Plan, $16 million to support 
the Integrated Ocean Observing System, and $8 million to define the 
outer limits of the U.S. extended continental shelf.
    The increases to protect and restore coastal and marine areas 
include $8 million for management of the newly-designated Northwestern 
Hawaiian Islands Marine National Monument, $10 million for restoration 
of nearly 1,000 miles of habitat for the endangered Atlantic salmon in 
the Penobscot River watershed, $15 million for the Coastal and 
Estuarine Land Conservation Program, and $5 million for the 
implementation of coastal resource priorities identified by the Gulf 
Coast States.
    The increases for ensuring sustainable use of ocean resources 
include $20 million to improve fishery management, including $6.5 
million to implement the newly-reauthorized Magnuson-Stevens Act. An 
additional $3 million will support development of offshore aquaculture, 
for which the administration has proposed legislation to establish 
clear regulatory authority and permitting processes.
    The President's fiscal year 2008 budget also continues support for 
development and acquisition of geostationary and polar-orbiting weather 
satellites, for climate research programs, and for high priority 
weather forecasting endeavors including improvements to hurricane 
modeling and tsunami warning systems.
    The Economics and Statistics Administration (ESA) promotes the 
understanding of the U.S. economy and its competitive position. Under 
ESA's umbrella, the Bureau of Economic Analysis (BEA) provides key 
objective data, including the Gross Domestic Product, on the Nation's 
economic condition in a timely and cost-effective manner. The 
President's fiscal year 2008 budget requests $85 million for ESA 
Headquarters and BEA to provide statistics that are critical to public 
and private sector decision-making. This request includes an increase 
of $2 million to measure the impact of research and development along 
with other knowledge-based activities on economic growth.
    ESA's Census Bureau is the leading source of quality data regarding 
the Nation's population and economy, and the President's fiscal year 
2008 budget requests $1.23 billion in discretionary funds for the 
Census Bureau. This includes a program increase of $325 million for 
Periodic Censuses and Programs. Of this increase, the largest component 
is $281 million to continue reengineering the 2010 Decennial Census to 
reduce operational risk, to improve accuracy and relevance of data, and 
to contain total costs and provide for the 2008 Census Dress Rehearsal. 
Another program addition includes $43 million to support collecting and 
processing data from the 2007 Economic Census. Also included is an $8.1 
million initiative to provide quarterly and annual coverage of all 12 
service sectors, matching the coverage of the quinquennial Economic 
Census. This will greatly improve understanding and tracking of 
economic developments in the service sector, which currently accounts 
for 55 percent of Gross Domestic Product.
    The International Trade Administration (ITA) supports U.S. 
commercial interests at home and abroad by strengthening the 
competitiveness of American industries and workers, promoting 
international trade, opening foreign markets to U.S. businesses, and 
ensuring compliance with domestic and international trade laws and 
agreements. The President's fiscal year 2008 budget requests $412 
million for ITA to serve its goals, including an increase of $1.3 
million for monitoring and enforcement of compliance with Free Trade 
Agreements, concluding the Doha Round of World Trade Organization (WTO) 
negotiations and reducing market access barriers through relevant WTO 
committees.
    The Economic Development Administration (EDA) supports America's 
regions in their growth and success in the worldwide economy. The 
President's fiscal year 2008 budget requests $203 million for EDA to 
carry out its mission effectively.
    The Bureau of Industry and Security (BIS) regulates the export of 
sensitive goods and technologies to protect the security of the United 
States. The President's fiscal year 2008 budget requests $79 million to 
enable BIS to effectively carry out this mission. This request reflects 
greater efficiencies from the consolidation of administrative services 
and increased use of information technology in handling export 
applications, resulting in savings of $1.5 million from the President's 
fiscal year 2007 request adjusted for inflation.
    The Minority Business Development Agency (MBDA) focuses on 
accelerating the competitiveness and growth of minority-owned 
businesses by assisting with economic opportunities and capital access. 
The President's fiscal year 2008 budget requests $29 million to support 
MBDA's programs and expand the availability of services to minority 
business enterprises.
    The President's fiscal year 2008 budget request of $641 million for 
the National Institute of Standards and Technology (NIST), a part of 
the Technology Administration (TA), will advance measurement science, 
standards, and technology. NIST's activities provide key support for 
the administration's American Competitiveness Initiative. This budget 
request includes a $69 million increase for NIST laboratories, National 
Research Facilities, and Construction and Major Renovations. Of these 
funds, $47 million are proposed to support critical improvements to 
NIST's research laboratories in Boulder, Colorado and the NIST Center 
for Neutron Research in Gaithersburg, Maryland, while $22 million are 
proposed to support research programs in nanotechnology, quantum 
information science, climate change measurements and standards, 
disaster-resilience of structures and earthquake hazard reduction.
    The Under Secretary for Technology (TA/US) currently provides 
policy guidance to the Secretary of Commerce and the Technology 
Administration's component agencies (NIST and NTIS). Technology plays a 
critical role across every sector of the economy, and the promotion of 
technology in advancing America's competitiveness has become an 
integrated part of the mission across the bureaus of the Department. In 
keeping with this evolution, the President's fiscal year 2008 budget 
proposes to modernize the Department's approach to technology policy by 
elevating those activities to the secretarial level. This modernization 
includes the appointment of a senior advisor in the Department's Office 
of Policy and Strategic Planning who will chair a Department-wide 
Technology Council to coordinate technology policy activities across 
the Department in lieu of a stand-alone Technology Administration. The 
request of $1.6 million provides resources for the orderly transition 
of TA/US to the new coordinated structure.
    The National Technical Information Service (NTIS) collects and 
preserves scientific, technical, engineering and other business-related 
information from Federal and international sources and disseminates it 
to the American business and industrial research community. NTIS 
operates a revolving fund for the payment of all expenses incurred and 
does not receive appropriated funds.
    For the National Telecommunications and Information Administration 
(NTIA), the President's fiscal year 2008 budget request includes $19 
million in discretionary budget authority. During fiscal year 2008, 
NTIA estimates obligating $534 million from the Digital Television 
Transition and Public Safety Fund to support several programs created 
by the Deficit Reduction Act of 2005, most notably $426 million for the 
Digital-to-Analog Television Converter Box Program. Following enactment 
of the Call Home Act of 2006, up to $1 billion will be awarded in 
fiscal year 2007 to qualified applicants in the Public Safety 
Interoperable Communications Grant program, though outlays will 
continue over several fiscal years.
    Furthering the mission to promote the research, development, and 
application of new technologies by protecting inventors' rights to 
their intellectual property through the issuance of patents, the 
President's fiscal year 2008 budget requests $1.9 billion in spending 
authority for the U.S. Patent and Trademark Office (USPTO). The USPTO 
will use these funds to reduce application processing time and increase 
the quality of its products and services. This includes $36 million to 
hire new examiners to improve processing times and increase the quality 
of its services. Consistent with prior years, the administration 
proposes to fund the USPTO budget exclusively through offsetting fee 
collections. Fee collections for fiscal year 2008 are projected to 
cover the proposed increases.
    The USPTO, the National Intellectual Property Law Enforcement 
Coordination Council (NIPLECC), and ITA participate in the Strategy 
Targeting Organized Piracy (STOP!) initiative's goal of ending trade in 
counterfeit goods. This initiative places additional intellectual 
property experts in high priority markets, trains foreign government 
officials in intellectual property protection, and educates foreign 
publics about the importance of intellectual property. STOP! also 
provides resources for harmonizing patent laws, and for supporting the 
negotiation of intellectual property sections of free trade agreements.
    Today, I would like to show how diverse components of the 
Department contribute to innovation and competitiveness. Many people 
see the Department of Commerce as a conglomerate with diverse and 
distinct missions. While the Department's bureaus encompass broad, but 
distinct, areas of the American economy, their core mission is U.S. 
competitiveness.
    Innovation is essential to competing globally and enhancing our 
quality of life. This is increasingly important as political and 
technological changes open access to the global economy--creating both 
new markets and increased competition. The Department of Commerce is 
well positioned to help America address this challenge.
    There are many areas across the Department where we are working on 
different aspects of competitiveness. Technological innovation is one 
of this Nation's most significant competitive advantages. The 
Department promotes and protects technological innovation through the 
efforts of its bureaus. A prime example is Global Positioning System 
(GPS) technology. Highly accurate timekeeping is a crucial element of 
GPS. The Department's National Institute of Standards and Technology 
(NIST) invented the core GPS timekeeping technology--the world's first 
atomic clock--in 1949 and continues to make significant improvements in 
its accuracy.
    GPS is made up of more than two dozen satellites in medium Earth 
orbit, which transmit signals that allow GPS receivers to determine 
location, speed and direction. Since the launch of the first 
experimental satellite in 1978, GPS has become a vital tool to 
governments, businesses, and private citizens worldwide. Its navigation 
capabilities are indispensable not only to the airline and shipping 
industries, but also to many Americans who now have personal GPS 
devices that they use in their cars, on bikes, and while camping and 
hiking.
    As the timekeeping technology improves, so do the navigation 
capabilities of GPS, expanding its uses into more areas. Currently, 
NIST operates the world's best standard atomic clock, NIST-F1, with an 
accuracy equivalent to about one second in 70 million years. NIST 
scientists are developing new atomic clocks that will soon be accurate 
to one second in many billions of years. NIST also is pioneering new 
approaches to atomic timekeeping such as the chip-scale atomic clock, 
which could dramatically improve GPS receiver performance and impact 
many other technologies.
    In addition to developing technologies underlying GPS, the 
Department, through the United States Patent and Trade Office (USPTO), 
protects individual and corporate inventors of GPS technology. In 
exchange for this protection, inventors are required to share 
information about their inventions, allowing others to build upon them 
and create further innovations. Taking GPS as an example of how well 
the patent system encourages innovation, the USPTO issued over 800 GPS-
related patents in 2006 alone.
    The Department, through the USPTO, also helps protect both GPS 
manufacturers and the public by registering trademarks. Manufacturers 
rely on trademark protection received from registering their trademarks 
with the USPTO to prevent others from marketing products under their 
good names. The public relies on trademarks as an assurance of the 
quality and source of the products they purchase.
    The Department understands that GPS and other technological 
innovations are critical to making the U.S. more globally competitive. 
As such, the International Trade Administration (ITA) works closely 
with the United States Trade Representative to develop Free Trade 
Agreements (FTA) that will eliminate duties on GPS receivers and 
transmitters in all FTA countries. This will expand opportunities for 
U.S. businesses, allowing them to export these GPS technologies to FTA 
countries duty-free. ITA, along with NOAA and NTIA, is also taking the 
lead in trade discussions with Europe to maintain a level playing field 
as Europe's upcoming Galileo system enters the satellite navigation 
market.
    Additionally, ITA's U.S. Commercial Service assisted iSECUREtrac 
Corp, based in Omaha, Nebraska, with a contract for the sale and 
installation of the first ever state-of-the-art Canadian-based GPS host 
monitoring system capable of serving the mission critical offender 
monitoring requirements of every Canadian Province.
    As trade barriers are reduced and technology transfer becomes more 
seamless across the globe, GPS technology is increasingly disseminated 
worldwide for both civilian and military use. The Department's Bureau 
of Industry and Security (BIS) oversees and implements regulations that 
clearly distinguish between military and civilian GPS user equipment to 
foster economic growth in the U.S. GPS manufacturing industry while 
protecting U.S. national security. These regulations define, identify, 
and distinguish military receivers, encryption devices, and GPS 
components with missile or certain defined airborne applications from 
their civilian counterparts. These controls have helped accelerate U.S. 
industry's exports to foreign GPS markets and have enabled the U.S. GPS 
manufacturing industry to retain a large share of those markets.
    Prior to September 1991, most GPS user equipment shipped abroad 
required individual validated licenses to ensure compliance with U.S. 
export control regulations. Under current regulations, civilian GPS 
receivers, other satellite equipment, and associated telecommunication 
equipment are allowed to be shipped, with certain restrictions, to most 
destinations without a license. However, BIS has implemented stringent 
regulatory controls to prevent transfer of GPS equipment to terrorist-
supporting countries, as well as to those end users known to be 
involved in proliferation activities. These export license applications 
are closely scrutinized and vetted in an interagency review process 
coordinated by BIS.
    Beyond making GPS work better, helping facilitate the success of 
U.S. businesses in the global marketplace, and ensuring that the global 
spread of GPS technology will not endanger our national security, the 
Department utilizes advances in technology to significantly improve how 
we conduct business--making our processes more efficient. For example, 
the Census Bureau launched a reengineering effort in preparation for 
the 2010 Decennial Census that centered on using technology to improve 
processes and keep down overall lifecycle costs. GPS technology is 
critical to the success of this effort. The first step involves 
collecting the GPS coordinates of streets, county by county, across the 
Nation. This multi-year effort will be completed in 2008, giving the 
Census Bureau an accurate database for the country. This database, the 
Topologically Integrated Geographic Encoding and Referencing system 
(TIGER), will then allow personnel operating in the field to know their 
relative position--a critical aspect of finding the right housing unit.
    GPS-equipped handheld computers (HHCs) will be used for data 
collection in several major field operations during the 2010 Decennial 
Census. During the address canvassing operation, the HHCs will be used 
to record GPS coordinates for every structure, including newly 
identified addresses. Later, using GPS, the HHCs will enable staff to 
conduct data collection for the non-response follow-up operation, allow 
for the removal of late mail returns, and record daily payroll for all 
census enumerators. The use of GPS technology will result in improved 
productivity and reduced errors.
    The Economics and Statistics Administration is building measures of 
innovation in the economy generated by such technological advancements 
as the GPS-equipped HHCs. Similarly, the Bureau of Economic Analysis is 
refining its ability to measure the impact of research and development 
on the economy.
    In addition, NOAA uses GPS to navigate its fleet of ships; enforce 
fishery boundaries in open waters to prevent overfishing; survey the 
Nation's coastlines, waterways, and airport approaches; and make 
improved weather forecasts. NOAA also provides a public service to the 
Nation known as the National Continuously Operating Reference Station 
(CORS) network. The CORS network consists of over a thousand GPS 
tracking stations that enable users to refine GPS measurements down to 
the centimeter level, which is particularly important for measuring 
real estate boundaries, positioning bridges and roads, and doing other 
geospatial work.
                               conclusion
    The Department of Commerce's development, promotion, and 
advancement of GPS technology demonstrates how the Department 
successfully encourages innovation to create economic growth without 
sacrificing our national safety. It also illustrates that Commerce is a 
diverse group of agencies, with varied expertise and differing needs, 
all engaged in a common commitment to keep the United States at the 
global forefront of competitiveness and innovation. This is the way we 
at the Department do business every day--working together, across 
disciplines, making real, positive, and sustained impacts on the 
American economy.
    The President's fiscal year 2008 budget effectively meets those 
needs, while exercising the fiscal restraint necessary to sustain our 
economic prosperity. I look forward to working with the committee to 
keep our Nation's economy growing and strong, and to promote and 
preserve the American people's entrepreneurial spirit.

    Senator Mikulski. Well, thank you very much, Mr. Secretary 
for that informative conversation and also bringing us in the 
real-world capability. And, of course, it would involve the 
Patent Office as well, because while people invent it, we gotta 
protect it, so others don't steal it.
    But, let me get right to the heart of my questions. As we 
look at the President's budget request of $6.5 billion, about 
one-half is in NOAA, and about one-third is in the Patent 
Office, the Patent Office about $1.9 billion--we'll round it 
off and say $2 billion--and there were other related agencies.

                          PROMOTING INNOVATION

    Let's go to your promotion of innovation, you meaning 
Commerce, and not you personally. How do you see, given that 
you have the major agencies of NIST, NOAA, the Patents and some 
other related agencies--where is it in your operation that 
says, we've got to promote innovation, and I'm going to stand 
sentry over it to make sure we're coming up with the kind of 
research ideas, and then as industry does what it does--which 
is invent--we protect them. Do you have a one-stop shop? How 
does this work?
    Mr. Gutierrez. Stepping back, the way we're thinking about 
it, is our whole economy is really a partnership between the 
private sector, the public sector, and academia. The private 
sector does about two-thirds of all the research and 
development (R&D) spending in the country, and that R&D in the 
private sector is very focused on the development side.
    The Government does about one-third, and of that one-third, 
its primary focus is on the ``R,'' the research side. We tend 
to do projects that are very long term in nature, that the 
private sector sometimes does not have the time or the 
resources, or the competitive environment to be able to take 
the time to look out 10 or 15 years.
    As we work on our technologies, we have to ensure that 
there's a customer on the other end. And that customer, of 
course, is the private sector. Dr. Jeffrey, I hope, will be 
talking about members of the private sector that work inside of 
NIST. And every time we open up a project in NIST, it starts 
out with members of the private sector who are interested in 
the developments of that project.
    As part of our overall system, we have to have a patent and 
trademark operation that responds to increasing demands of 
businesses, and increasing demands to be responsive to issue 
patents, and to issue trademarks and copyrights. In essence, we 
participate in the creation of the innovation, we coordinate 
very closely with the private sector, and then we enable that 
innovation by having an efficient Patent and Trademark Office. 
I would say innovation is embedded in every one of our bureaus.
    Senator Mikulski. But you have a coordinating council?
    Mr. Gutierrez. Yes, we do.
    Senator Mikulski. That you chair?
    Mr. Gutierrez. This is a new Technology Policy Council, as 
well as an Innovation Metrics Advisory Council, which we've 
just started.
    Senator Mikulski. Yeah, I've read about it in Technology 
News, I actually read these things. It's great.
    Mr. Gutierrez. We just had our first meeting, too.

              PATENT AND TRADEMARK OFFICE REMEDIATION PLAN

    Senator Mikulski. Well, in--first of all, I think, I know 
Senator Shelby wants to talk about NOAA and why it wasn't in 
the President's competitive agenda, but I'm going to take up 
the issue of intellectual property, and then come back to NOAA 
and its satellites.
    When I read the inspector general's report of the commerce, 
it talked about the major challenges of the Department, and it 
said it was making improvement. But one of the things that it 
raises is the fact that we have to ensure that the Patent 
Office uses its authorities and flexibilities to achieve better 
results--and I would say money, too, because that goes with it.
    In the last 5 years, under Senator Gregg, Senator Hollings, 
and Senator Shelby, and now me--we've increased Patent Office 
by 50 percent. And you're close to $2 billion. Yet, there 
continues to be reports about the management issues, and I know 
we'll hear about it more in the testimony--the lack of 
effective strategies to communicate and collaborate with 
examiners, of course, the production quotas, which is the 
tremendous backlog, and the lack of ongoing technical training 
for examiners. I won't go through every item, but I commend to 
you the GAO report, and also the major challenges.
    Now, we want to hear from Mr. Dudas about this. I would 
like to have a remediation plan. And I'd like to have it from 
Mr. Dudas, as the Chief Executive in the agency, but I would 
also ask that you personally review that remediation plan, and 
get back to us in about 45 days. So, that when we do this 
year's appropriation, it is about money, it is about 
management, it is about leadership, and it's about protecting 
our ideas.
    So, if we could have a specific remediation plan that goes 
along with this, I think we would go a long way.
    Mr. Gutierrez. Yes, Madam Chairwoman, we will do that, and 
we will have a plan ready for your review. I think that's an 
excellent idea.
    [The information follows:]
        USPTO Report ``The Path to the Future, the Next Steps''
                                                         April 2007
                           executive summary
    Fiscal year 2006 was a record-breaking year for the USPTO. Our 
8,500 employees had the highest production, highest hiring, highest 
usage of electronic filing and electronic processing, highest number of 
examiners working from home and lowest error rate in history. While 
this is a source of pride, we all recognize that even more can and must 
be done. Below is a list of initiatives that are either in place, being 
piloted for implementation, or are planned for implementation as 
permanent improvements.
                           measures in place
Pendency/Productivity
    The USPTO has built a performance-based culture.
    Hiring 1,200 new patent examiners per year (fiscal year 2006-2012).
    Improved Training for new patent examiners in a university-style 
environment.
    Accelerated Examination--a guaranteed complete patent examination 
in 12 months.
    Increased overtime authorization levels and a home office laptop 
program to increase morale and encourage productivity.
    Electronic Processing from start to finish.
    Work Sharing with foreign patent offices to decrease U.S. 
examiners' workload.
    Flat Goal pilot program to allow examiners more flexibility and an 
opportunity to earn increased bonuses for increased productivity.
    Early Interviews between applicants and examiners--speeds the 
process by focusing issues and minimizing misunderstandings.
Human Resources
    Aggressive and Expanded Recruitment efforts targeting able 
candidates likely to succeed in an individualized, production-oriented 
environment.
    Higher Pay: Special pay rate for examiners; bonuses for higher 
production and quality; recruitment bonuses; and retention bonuses.
    Teleworking: The USPTO has the gold standard for federal 
teleworking. More than a thousand patent and trademark examiners are 
working from home with hundreds more added each year.
    Increased and better communication with employees through 
management training, employee training and communication initiatives.
                           measures proposed
    Applicant Quality Submissions aid and hasten examiner reviews.
    Public Review of published applications.
    Public Quality Submissions allow the public to comment on pending 
applications with more prior art, which results in quicker, higher 
quality examiner reviews.
    National Workforce so USPTO employees may ``work from anywhere'' in 
the United States.
    Alternative approaches to examination.
    University certification program to prepare students for examiner 
jobs at USPTO.
    The charts below illustrate the impact on the Pendency, 
Productivity, and Quality measures if the Proposed Applicant Quality 
Submissions are executed:

----------------------------------------------------------------------------------------------------------------
                           Fiscal year                               Pendency      Productivity       Quality
----------------------------------------------------------------------------------------------------------------
2007............................................................            33.0            75.8            96.0
2008............................................................            34.7            73.1            96.0
2009............................................................            34.7            80.4            96.0
2010............................................................            34.8            87.0            96.0
2011............................................................            32.9            91.4            96.0
2012............................................................            28.0            92.6            96.0
----------------------------------------------------------------------------------------------------------------

                                                                                                  
                                                                                                  
                                                                                                  
                                                                                                  
                                                                                                  
                                                                                                  
                                                                                                  
                                                                                                  

    As the chart above illustrates, in fiscal year 2006 the USPTO met 
90 percent of the performance goals established pursuant to the 
Government Performance and Results Act of 1993 (GPRA), providing its 
best record to date for achieving important measures of performance and 
results.
    This report lists and discusses our ongoing, planned, and 
envisioned initiatives intended to address the challenges facing the 
USPTO in terms of patent pendency, patent application backlog, and the 
effective recruitment, training and retention of patent examiners.
           addressing patent pendency and application backlog
Hiring Patent Examiners
    With full access to our collected fees, the USPTO hired a record 
1,218 patent examiners in fiscal year 2006, exceeding our hiring goal 
by more than 200 examiners. The USPTO plans to hire 1,200 patent 
professionals a year in fiscal year 2007 through fiscal year 2012 for a 
gross total of at least 8,400 patent examiner new hires by end of year 
fiscal year 2012. After attrition, USPTO staffing increased by 683 in 
2006 and will increase by 3,900 over 2006-2012.
    While hiring a sufficiently qualified and productive patent corps 
is a critical factor in controlling pendency and reducing backlog, we 
recognize that hiring alone is simply not enough. Supplemental 
initiatives, including fuller participation by patent applicants as 
described below, will help us attain our long-term strategic goal of 
reducing patent pendency from the current 33 months to 28 months for 
final disposition, by 2012.
Full Access to Fees
    We are thankful that the subcommittee and your House colleagues 
have ensured that our current fee schedule remains in effect for fiscal 
year 2007. We are also pleased that the fiscal year 2008 budget request 
gives the USPTO full access to the $1.9 billion in fees we expect to 
collect. This is the fourth consecutive year that the President's 
budget recommends full access to collected fees, and the USPTO 
appreciates the continued Congressional support for that funding level.
    The Administration is considering for submission to Congress draft 
legislation that will make permanent our current fee schedule. We look 
forward to working with the subcommittee toward enactment of 
appropriate legislation.
    Full access to user fees is needed to allow the USPTO to continue 
its successful model of disciplined focus on real measures that enhance 
quality and increase production, increase hiring and training, promote 
electronic filing and processing, provide telework opportunities for 
our employees, and improve intellectual property protection and 
enforcement domestically and abroad.
    Full access permits us to finance the initiatives--particularly 
initiatives requiring long-term planning and commitment--necessary to 
providing and maintaining reliable, functioning systems. Without 
Congressional support, we would not be able to function in a business-
like manner and achieve these results.
Electronic Filing and Processing
    The USPTO continues to promote electronic filing and processing of 
patent applications as a means of reducing paper-based inefficiencies. 
Patents implemented the Electronic Filing System-Web (EFS-Web), a user-
friendly, Internet-based patent application and document submission 
program. Prior to fiscal year 2006, less than 2 percent of patent 
applications were filed electronically. After working with the public 
and introducing the much-improved EFS-Web system in late 2006, a total 
of 14 percent of patent applications were filed electronically in 
2006--with more than one-third being filed electronically in the last 
month of fiscal year 2006. We anticipate that electronic submission of 
new applications will grow to more than 50 percent in fiscal year 2007. 
We will work with our stakeholders to further promote electronic filing 
and interaction with patent applicants.
    We are developing the electronic Patent File Wrapper (PFW) that in 
conjunction with current Patent Automated Information Systems will 
allow for a fully automated, text-driven patent application processing 
system.
    Operating in today's wired world requires that the USPTO have full 
electronic processing that is safe, secure and continually available to 
employees, applicants and stakeholders. We will continue to work toward 
that goal.
Innovative Processing
    The USPTO is developing and reviewing a variety of innovative 
patent processing initiatives including a new offering for the public 
called ``Accelerated Examination.'' Under this program, which began 
August 26, 2006, any applicant who wants or needs quick turnaround can 
obtain a patent determination within 12 months. In exchange for this 
quick turnaround, applicants must file a complete application, agree to 
interviews and accelerated response periods, must file and prosecute 
their application electronically and must provide more information 
about the invention to the USPTO in the form of a prior art examination 
support document. The first application to be completed under this 
program was filed on September 29, 2006, and the patent issued on March 
13, 2007 (less than 6 months from date of filing).
    The USPTO is also cooperating in a pilot program involving peer 
review of patent applications. Up to 250 applications, assigned to 
Technology Center 2100, which examines computer-related technologies, 
will voluntarily be placed, by the applicants, on a non-USPTO web site 
for an expanded and public review by a peer group of patent users, 
attorneys and academics. The pilot group of applications will include 
applications filed by small entity filers. The public group will 
determine and submit to the USPTO what they consider the best available 
and relevant prior art. The pilot will test whether this peer review 
can effectively identify prior art that might not otherwise be found by 
our examiners during the typical examination process. We will also make 
an evaluation as to whether this process results in measurable 
examination timesavings and quality improvements.
    We will continue to collaboratively work with our stakeholders to 
determine if there is some combination of examination alternatives to 
the current one-size-fits-all filing and examination process that would 
better meet applicants' needs while providing a more efficient use of 
USPTO examination resources.
    The USPTO, with the help of its Congressionally mandated Patent 
Public Advisory Committee (PPAC), is reaching out to the intellectual 
property community to seek their input on improvements to the patent 
system in all areas including, but not limited to, examination, 
prosecution, enforcement and levels of patenting. Through the PPAC, we 
anticipate an open dialogue with patent stakeholders and the public as 
to what the Office needs to do to best protect and encourage innovation 
in America. We are open to all possibilities from minor improvements to 
a dramatic overhaul of patent protection, if necessary. We are looking 
at a wide variety of alternative examination products from those 
needing statutory changes to those that can be implemented immediately 
under our existing authorities. We look forward to working with the 
Congress and the public to develop these possible alternative 
examination products that effectively and fairly balance the needs of 
the Office and the interests of the intellectual property community to 
provide a system that allows for maximum enforceability.
    Our long-term strategic goal is to reduce patent pendency from the 
current level of 33 months to 28 months for final disposition, by 2012. 
Metrics include reduction of the initial waiting time for patent 
applications (first-action pendency) in our most backlogged Technology 
Centers and successful implementation of various initiatives (such as 
Accelerated Examination) that ensure goal achievement by 2012.
    The USPTO is both implementing initiatives and exploring strategies 
that will reduce the backlog of unexamined patent applications and 
improve the timeliness of a patent examination.
Applicant Quality Submissions
    By shining the light inward on the USPTO, we have had the 
opportunity to improve our system and offer applicants new 
alternatives. As policymakers, we must also analyze how the patent 
system can be improved from the outside in. Perhaps the most important 
element of ensuring that patent examinations are of the highest quality 
and completed as efficiently as possible is what the applicant files.
    The patent applicant has the most knowledge, the most opportunity, 
and the most to gain by providing the USPTO with the best possible 
information about his or her invention. Unfortunately, in many cases, 
applicants have expressed strong concerns about providing the USPTO 
with information about their applications. In some cases, applicants 
simply do not want to provide important information for fear that it 
will limit the scope of the patent they may receive (though such a 
limitation would be right under the facts and the law) or do not want 
to do the work associated with better defining their inventions. In 
some other cases, applicants or their attorneys recognize that 
providing information improves quality and timeliness but fear that the 
legal system unfairly punishes them with draconian penalties for 
innocently omitting information. The theory is that if one provides 
information, he or she must do so perfectly or potentially lose the 
patent; whereas, a failure to share any information carries no 
consequences.
    Quality absolutely begins with the application. Nobody knows more 
about the invention than the applicant. In the Accelerated Examination 
Program--where the first patent issued in less than six months--the 
applicant is required to submit to an interview and to provide a search 
and a support document. Our limited experience with this initiative is 
that both applicants and examiners believe that more written and oral 
information from applicants improves quality and timeliness.
    We would like to take the success of this model of applicant 
quality submissions to lower pendency, raise productivity and increase 
quality in all patent examinations. To that end, we believe that 
applicants should be given every opportunity and responsibility to 
provide more and better information to examiners about their 
inventions. For such a program to be successful, policymakers must work 
to ensure that more and better information does not become burdensome. 
Policymakers would also need to consider how the current doctrine of 
inequitable conduct may discourage applicants from fully and fairly 
sharing relevant information with the USPTO.
Rule Making and Examination Reform
    We believe that to effectively address and control pendency, and 
reduce backlog, the USPTO needs to receive more and better-focused 
information from applicants themselves and from the public at large. 
The USPTO has proposed and will propose regulations and administrative 
changes governing submission of patent applications that will enable 
our examiners to make more efficient and informed patentability 
determinations.
    First, we have proposed limiting the number of continuing 
applications and continued examination requests to provide an incentive 
for applicants to focus their initial patent applications on their 
inventive contributions. Second, we have proposed to limit the number 
of claims that are initially examined in order to provide an incentive 
to focus the examination process. The first and second proposals have 
optional procedures which continue to provide an applicant flexibility 
where the applicant may need additional continuing applications or 
initially examined claims upon a showing of that need or by shouldering 
additional responsibilities. Numerous comments have been received in 
response to these proposals and are being carefully considered prior to 
promulgation of any final rule. In parallel, we have proposed revisions 
to our information disclosure requirements to focus our limited 
examination resources on prior art that is most relevant to the 
examination process. Additionally, we are considering a new practice 
change to require applicants to conduct a pre-examination search and 
provide to the Office prior to examination a report on why they believe 
that they are entitled to the claims presented in view of the 
information discovered during that search.
    Our hope is to achieve examination reform that creates better-
focused examination and enhances information exchange between applicant 
and examiner. We look forward to working with the public and Congress 
to develop an enhanced examination system that effectively and fairly 
balances the needs of the Office and the interests of patent 
applicants, interested third parties and the general public.
Public Quality Submissions
    While the USPTO currently has a procedure for submission of prior 
art after publication, which allows submission by third parties within 
two months of publication, the procedure does not allow explanations or 
other information about the patents or publications, absent express 
written consent of the applicant.
    We look forward to working with Congress to develop a submission 
procedure that effectively and fairly balances the interests of the 
patent applicant, interested third parties and the general public.
    We are also looking to provide assistance to the open source 
community in their development of an open source database to provide 
examiners with potential prior art.
Work Sharing
    The USPTO continues to work with the world's major intellectual 
property offices to study, review and implement work-sharing efforts 
that promote examination efficiencies in each participating office. The 
USPTO launched a trial cooperation program with the Japan Patent Office 
(JPO) last summer to leverage fast-track patent examination procedures 
already available in both offices to obtain corresponding patents 
faster and more efficiently. It also permits each office to benefit 
from work previously done by the other office, in turn reducing 
examination workload and improving patent quality.
    This program is a significant first step in cooperative efforts to 
support United States and Japanese industries in their global patent 
prosecution activities and represents the first concrete implementation 
of a work-sharing arrangement between the USPTO and the JPO.
    The USPTO continues to have informal discussions on expanding the 
work-sharing program to other intellectual property offices, mainly in 
Australia, the United Kingdom, and Canada. The USPTO will continue its 
efforts in expanding this program and will develop a coordinated 
approach among the offices in order to streamline practices and 
procedures.
       addressing recruitment, training and retention challenges
Making USPTO an ``Employer of Choice''
    Continuing to attract and retain the finest public servants is a 
growing challenge. Our employees are at the heart and soul of our 
intellectual property system, and we need to do everything we possibly 
can to ensure they have an environment of trust, respect and 
opportunity.
    The USPTO has developed and implemented a variety of workplace-
friendly, family-friendly initiatives that have earned the USPTO 
recognition by Business Week magazine as one of the best places in 
America to launch a career and to round out one's career. The USPTO has 
also been lauded by Families magazine as one of the best places in the 
Washington area to work if you have a family. We will expand and 
improve our workplace offerings and attributes to promote the USPTO's 
image as an ``employer of choice.''
Recruitment
    The USPTO's recruitment efforts are strong and nationwide in scope. 
Planning efforts have culminated in targeted TV, print, radio and 
Internet banner advertising, and developing a brand image, ``Examine 
the Possibilities''. Additionally, in 2004, the USPTO increased career 
and job fair participation and, in 2006, participated in over 180 
events throughout the country. Also, in 2006, a recruitment incentive 
(up to $9,900 per year for four years) was offered to computer and 
electrical engineers.
    A pre-employment compatibility assessment tool has been developed 
and is in use for all examiners applying through USA Staffing.
    We are exploring partnerships with universities to offer 
intellectual property courses to science and engineering students, 
develop an internship program, and train students in intellectual 
property to create a ready pool of potential examiner candidates.
Internal Communication
    Consistent with recommendations made by the Government 
Accountability Office in 2005, the USPTO has implemented a wide variety 
of initiatives to address communication issues, including a pilot 
program for an Office of Internal Communications in October 2006.
    The Commissioner for Patents and Deputy Commissioners host regular 
Town Hall meetings with employees at all levels throughout the Patent 
organization. First line supervisors are required to hold regular 
employee meetings and are held accountable through their performance 
plans. In 2005, monthly meetings were instituted with Patent 
management, Administration management and patent union representatives, 
as well as quarterly Joint Labor Management meetings.
    In 2006, we also had the first ever Management Conference for all 
of the USPTO's managers, numbering over 500 employees. For two days, 
our managers attended sessions and collaborated on best practices of 
how to manage the highly skilled and dedicated workforce at the USPTO.
    On November 1, 2006, the USPTO held an agency-wide celebration 
event where management thanked and praised employees for their efforts 
in making 2006 a record-breaking year.
Training and Development
    In fiscal year 2006, the USPTO implemented a university approach to 
training new examiners. The university method provides training to new 
examiners in a classroom setting for eight months, rather than using 
the traditional one-on-one training model. This allows us to deliver 
intensive training to the newly hired examiners, leaving more 
experienced examiners and supervisors to focus on quality examination 
and reducing the backlog. In fiscal year 2006, 123 examiners completed 
the university's eight-month program. So far in fiscal year 2007, a 
total of 303 new examiners completed the training, with an additional 
451 examiners slated to graduate by the end of the fiscal year. To 
date, 871 patent examiners are either in the Patent Academy or have 
completed the eight-month program.
    Patent examiner training programs have been enhanced to include 
eight hours of technical training. We will work to enhance the skill 
sets of examiners authorized to train others by providing formal 
training to all personnel who are responsible for training new 
examiners and reviewing their work.
    Sixty-six patent examiners currently participate in USPTO's law 
school tuition reimbursement program, with tuition assistance up to 24 
credits per fiscal year. In addition, tuition assistance up to $5,000 
per examiner per fiscal year is available for technical courses.
Pay and Retention
    Last year, 60 percent of all patent examiners exceeded their goals 
in production and received a bonus for exceeding those goals. We are 
proud of their achievements. The average total compensation package 
(salary plus bonuses) for patent examiners is $99,000. While the U.S. 
Government's average pay grade is at the GS-8 level, the average at the 
USPTO is GS-11.
    All patent examiners received a 7 percent special pay rate increase 
in November 2006, making their total special pay rate a 10 percent 
increase.
    The USPTO expects to increase productivity in patents by offering 
examiners more opportunities to determine when and how they do their 
work, and achieve higher bonuses. The USPTO is piloting a voluntary 
flat goal program for patent examiners that builds upon the successful 
system in Trademarks and moves production away from an hourly-based 
system. Highlights of the program include awards of up to $5,000 per 
quarter; flexibility in where work is done; and a predetermined amount 
of work based on grade and docket.
    In 2006, USPTO management submitted proposals to patent union 
representatives for a new collective bargaining agreement that would 
replace a previous agreement negotiated in 1986. Proposals include 
enhanced patent examining monetary awards as well as a stand-alone 
quality award.
    Because more experienced examiners naturally are able to review 
cases faster, and in a more accurate manner, the USPTO has implemented 
a program of recruitment bonuses to hire and retain the talented 
engineers and scientists we need to examine our increasingly complex 
applications. We are reviewing other possible programs to help us 
compete with industry for professionals in the ``hot'' technology 
sectors. We want to be an ``employer of choice'' to the pool of tech 
professionals.
    The USPTO's fiscal year 2006 attrition rate was 10.6 percent--lower 
than comparable industry averages and a significant improvement over 
comparable past years. However, we believe we can further improve upon 
that number. The USPTO is reviewing additional incentive programs to 
recruit, retain and reward top performers. We will continue to become 
more flexible to enable us to attract and retain those top performers.
USPTO Telework--the ``Gold Standard''
    As we hire over 1,200 patent examiners a year, much of our human 
capital focus is on recruitment, retention, a balancing of work/life 
issues, less commuter time and more productivity, and the need to more 
efficiently manage our space.
    In fiscal year 2006, a pioneer group of 500 patent examiners 
participated in the newly implemented Patent Hoteling Program (PHP). 
The PHP was developed using the very successful Trademarks telework 
program model. PHP is a voluntary program and provides patent examiners 
the ability to work from home with complete on-line access to USPTO 
resources. We will add 500 more examiners to the hoteling program each 
year for the next several years. The goal of the hoteling program is to 
change the boundaries of the old workplace patterns allowing for 
decreased commute time, a more efficient use of office space, and even 
a more balanced lifestyle for our employees. This all translates into 
increased employee productivity and satisfaction, as well as higher 
employee retention.
    Patents is also piloting a work-at-home program for technical 
support staff.
    On a more long-term basis, we hope to create a workplace where an 
examiner can be successful from anywhere. In this regard, three 
possibilities are being investigated: (1) expanding the successful 
Patents Hoteling Program (PHP) in such a way as to create a more 
nationwide workforce; (2) creating remote or regional offices, or brick 
and mortar presences, in different locations across the country, 
selected upon a variety of factors such as where pockets of technology 
may be concentrated or there is increased access to a suitable 
workforce for hire; and (3) a storefront approach which, in a sense, is 
a hybrid of possibilities (1) and (2). The storefront approach would 
potentially provide a small-scale brick and mortar presence, or node, 
which could then act as a support center for employees participating in 
an expanded hoteling program.
    With respect to expanding the current PHP program to create a truly 
nationwide workforce, the Office is currently engaged in conversation 
with Congress, OPM and GSA about addressing the present requirement 
that hoteling employees physically report into the Office at least one 
hour per week to maintain the Office as their official duty station. 
Round-trip commuting to the official duty station for an hour plus, 
which is the current requirement, results in a very unproductive day. A 
modification of this requirement would permit hoteling employees to 
relocate to geographic locations at further distances from the Office, 
thus enhancing the Office's ability to reach out to high quality talent 
pools and those individuals not interested in living in or financially 
unable to live in the Washington, D.C. metropolitan area. If the one-
hour duty station requirement was lifted and USPTO was allowed a pilot 
or demonstration program, we would expect many retired patent examiners 
would consider working half-time or under the flat goal program. A 
further expansion on the second possibility (2) is that we might build, 
even locally, telework sites to provide employees with a brick and 
mortar presence to which to report, but one which may reduce or 
eliminate a great deal of their commuting time. The Office is open to 
all of these possibilities, or any combination thereof, as ways in 
which to better attract new employees, retain existing employees, and 
actively participate in e-government initiatives.
Retirees
    The USPTO takes advantage of the knowledge and skills of retirees 
who have left the USPTO. The opportunities where this pool of 
candidates can help us are tremendous. While some retirees have 
returned as rehired annuitants, many opted to work for companies who 
have contracted with the USPTO in the areas of examiner training in the 
Patent Training Academy, help-desk service for our customers in our 
Inventors Assistance Center, and examiner recruiting. This has allowed 
the agency to free up valuable examiner resources to focus on patent 
examining.
    The flexible work arrangements that the USPTO provides are very 
attractive and accommodating to retirees' schedules. Also, we expect 
that our vision of a truly nationwide workforce will include 
opportunities for USPTO retirees--including possible half-time or flat 
goal programs for retirees. The BusinessWeek recognition of the USPTO 
as one of the best places in America to round out one's career should 
allow us to recruit retirees from other industries as well.
                               conclusion
    This report has offered a comprehensive review of what has been 
done, what is in the process of being done, and what can still be done 
to further strengthen the patent system in the United States. While the 
Administration is committed to pursuing and improving upon its 
management initiatives and record level achievements in hiring, quality 
and production, electronic tools and teleworking, some of the key 
solutions to reduce pendency and optimize productivity and quality will 
require Congressional action.

    Senator Mikulski. And then we can match performance with 
money.
    Mr. Gutierrez. Yes.
    Senator Mikulski. It will be your plan?
    Mr. Gutierrez. Yes.
    Senator Mikulski. Senator Shelby.

                    GROSS DOMESTIC PRODUCT REVISION

    Senator Shelby. Thank you, Madam Chairman.
    Mr. Secretary, I understand--excuse me--that the announced 
quarterly gross domestic product (GDP) for the country 
contained a relatively large revision, we are all familiar with 
this, one-half of 1 percent downward from the amount estimated 
in January of this year. Such a revision has only occurred 
seven times in the last 30 years. While rare, this type of 
revision has impact on markets, and anticipate less volatility 
in the data released from the Bureau of Economic Analysis.
    What procedure does the economic--Bureau of Economic 
Analysis--have to help lessen the odds that similar revisions 
will occur again in the future? Or will not occur?
    Mr. Gutierrez. Yes, sir. Thank you.
    Senator Shelby. In other words, I know it's--you don't have 
all of the data and you're pushed to get it out.
    Mr. Gutierrez. Right.
    Senator Shelby. And you revise it with more accurate data.
    Mr. Gutierrez. Yes. Obviously it's a very complex set of 
sources that we have to be able to consolidate this one GDP 
number. I would say the one area that stood out as impacting 
that was the service industry. We know that we still have to 
make progress to be able to measure services, as well as we can 
measure manufacturing. We actually have $8 million in our 2008 
budget to be able to measure all service industries. We're not 
covering all services today.
    If I had to point to one thing, and there are many things, 
Senator Shelby, if I had to point to one thing that threw us 
off in that quarter, it was the service number. I think we can 
get better, and we need to get better, at measuring services, 
given that they're over two-thirds of our economy.
    Senator Shelby. You know, the Federal Reserve does a lot of 
measuring of our economy. Do you have an interoperable 
connection to the Federal Reserve on this? On the way you 
measure production and everything? You feed them things.
    Mr. Gutierrez. Yes, sir.
    Senator Shelby. I thought you did.
    Mr. Gutierrez. Yes, sir. We work very closely with them, 
with the Office of Economic Advisors, with Treasury and with 
Labor.

   NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION'S EXCLUSION FROM 
                  AMERICAN COMPETITIVENESS INITIATIVE

    Senator Shelby. NOAA. Last year, Mr. Secretary, the 
President designated a National Institute of Standards and 
Technology, the National Science Foundation (NSF), and the 
Department of Energy's Office of Science as part of the 
American Competitive Initiative Act. However, NOAA was 
noticeably excluded from this program, and that's troubling. To 
me, NOAA stands out as an international leader in marine and 
atmospheric science, and as a cornerstone of our Nation's 
research community.
    NOAA's education and outreach activities appear to fall 
directly in line with ACI's educational goals. Given NOAA's 
diverse research--you're very familiar with it--and innovative 
technology, why was this agency not recognized as a candidate 
for the ACI Program, and does the Department intend to endorse 
NOAA in the future to become an ACI Program?
    Mr. Gutierrez. Thank you, Senator. I think that's an 
excellent question.
    Technically, it's not under the umbrella of the ACI, but we 
think about NOAA as very much part of our competitive 
advantage.
    Senator Shelby. I know that Senator Alexander is very 
involved in the competitiveness issue.
    Mr. Gutierrez. We do think about it as our competitive 
edge. We believe that the management of our coastal marine 
resources is a competitive advantage, as we look at the rest of 
the world, and how they do it. It may not be under the ACI 
umbrella, but we think about it as very much a part of our 
competitive advantage.

    NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION, NATIONAL POLAR 
          ORBITING OPERATIONAL ENVIRONMENTAL SATELLITE SYSTEM

    Senator Shelby. I hope you can get it under there, we'll 
have to see what happens.
    NOAA, again. Last year, the national polar orbiting 
operational environmental satellite system--pronounce it, what, 
NPOESS program--was scrutinized for its mismanagement and lack 
of oversight. Now that the Nunn-McCurdy process has subsided, I 
feel that the Departments of Defense and Commerce have 
genuinely strived to regain control of the program, hopefully.
    I'm still dismayed with the revised program plan. When I 
compare the new goals with the program's original prospects, I 
see that we've lost two of the six satellites, and 4 of the 13 
sensors package, while adding 4 years of delay. Not to mention, 
a cost increase of $4.1 billion. Why are we spending more 
money, perhaps, to receive an inferior product? And how have 
the ramifications for this particular program impacted the rest 
of your Department's overall acquisition and procurement 
activities, and to ensure that the taxpayers do not see a 
situation like this again? I know, it's a big-ticket item.
    Mr. Gutierrez. It is, Senator. And, I appreciate the 
question, this is a very important topic. Twenty-five percent 
is a tremendous overrun. Just so that you know, I have met with 
the chief executive officers (CEO) of Lockheed Martin and of 
Northrop Grumman as soon as we heard about this. I'd say two 
big things contributes to the overrun. One is the process of 
evaluating these bids. Too often, I think, we go to the lowest 
bid, and not necessarily understanding that that supplier can 
come back and increase the amount after we have approved it.
    Senator Shelby. It's not a good way to do business.
    Mr. Gutierrez. It's not.
    Senator Shelby. You were the CEO of a large company.
    Mr. Gutierrez. Absolutely. I used to have to go to my board 
for a 10 percent overrun. And, it was a very bad day, so this 
is a very bad day.
    Senator Shelby. Twenty-five percent overrun is----
    Mr. Gutierrez. Twenty-five percent.
    Senator Shelby [continuing]. Should be a wake-up call.
    Mr. Gutierrez. It's 25 percent, and as you say, the scope 
of what we thought we were getting has been reduced. We're 
getting less than what we thought we were buying at the 
beginning. It is absolutely not acceptable. A lot of it also 
goes to our processes. This is Air Force, NOAA and NASA working 
together. Too often, we have a handoff of individual project 
timelines to the other agency. We need to have someone managing 
the whole process. I think there's a lot that we can be doing, 
and we are doing. I get a briefing on this probably once a week 
from my Deputy, who is all over this. And we still have to stay 
very close, because I don't want to have another situation 
where I come back to you and say that the project is off course 
again. I can assure you that this is one of the items that 
rarely does the day go by that I don't think about this.
    Senator Shelby. If you put your background in business to 
this program, and other programs, you'll meet the 
accountability standard that Senator Mikulski talked about 
earlier.
    Mr. Gutierrez. Yes, Senator.
    Senator Shelby. Thank you, Madam Chairwoman.
    Senator Mikulski. I'm going to associate myself with the 
line of questioning of Senator Shelby. We're in absolute 
agreement on the fact that this has to be fixed.
    Senator Reed, Senator Alexander came first--I would like to 
turn to call upon Senator Alexander, noting that he has been 
truly one of the leaders in our bipartisan effort to create a 
framework for innovation, and implementing the National Academy 
of Science report, ``Rising Above the Gathering Storm.'' We're 
really happy to have him on the subcommittee.

                    AUGUSTINE REPORT ON IMMIGRATION

    Senator Alexander. Well, thank you Madam Chairman, and 
Senator Shelby. I'm glad to be here with you, especially 
because of that interest, and I want to thank Senator 
Mikulski--there was no more enthusiastic supporter for the 
Augustine report, and the work that we have done over the last 
2 years than she has been.
    And, Mr. Secretary, I want to ask you a question about 
competitiveness--and this also relates to some work the 
chairman's done over time.
    At the Oak Ridge National Laboratory, which has led our 
effort to help the United States capture the worldwide lead in 
computing, it has the largest new materials machine in the 
world, it's the world's largest energy laboratory, the top 
three people there all have green cards. Fifty of the 100 
American Nobel Prize winners in physics are immigrants, or are 
foreign-born. We have more than 500,000 foreign students at our 
colleges, universities--all of these people are helping create 
this incredible standard of living we have in this country, 
creating jobs for us.
    Now, when the Senate passed the immigration bill, which you 
are very much a part of these days, I know, from talking with 
you--we seemed to have a consensus that we ought to do what the 
Augustine report, the National Academy's report describes as, 
``instituting new skills-based preferential immigration 
options.'' In other words, we've got 500,000 or 1 million 
people coming into this country legally every year, we may have 
that many illegally, if we secure the borders, that means we'll 
have 1 million or more people coming in every year, and I 
believe there's a consensus in the Senate that we ought to--
that we ought to make sure that we make it easier for us to in-
source brain power. We outsource jobs, we can in-source brain 
power.
    And, there were three provisions in the Senate-passed 
immigration bill to help do that, improving visa processing, 
giving a green card to doctorates, to foreign students who 
received their doctorates in science, technology, engineering, 
math, and if they had jobs, increasing the H1B visas for those 
sorts of people coming to our country. I think Senator Gregg 
also may have gotten onto the bill a provision that took a part 
of the visas that are in the lottery and made those more 
available.
    But, what I would like to do is ask you to comment on that, 
and to encourage you--since I know you're working on 
immigration, that with your background--both as a business 
leader, and someone who's, who I've heard speak eloquently 
about the importance of immigration to our country, and who 
understands it very, very, very, very well. I wonder if you can 
think of more ways, as we deal with immigration this year--more 
ways for us to institute skills-based preferences for people 
coming to our country that will increase our brain power 
advantage, which creates new jobs.
    Mr. Gutierrez. Yes, Senator, I think there's broad 
agreement on this. Many of the scientists who are driving 
Chinese innovations, and Chinese industries, as well as Indian 
industries were educated in the United States. We are giving 
these foreign scientists the best education you can get in the 
world, and then because they can't stay here, they have to go 
back home and compete against our companies.
    We have about 80,000 higher learning students from India 
and about 60,000 from China. Essentially, our quota just will 
not absorb all of them. So, the challenge here is to expand the 
quota, and be willing to give more green cards, and more 
residency status to these graduates. This is part of our 
comprehensive reform, this is the high-skilled portion of it 
that we don't talk that much about, but is perhaps just as 
important as anything else.
    Senator Alexander. Well, and, I guess the point of my 
question is, is to encourage you in it. Because, I know you're 
going to be in the middle of these debates and discussions, and 
I don't think it lacks for support in the Senate. We're for it, 
but we need some more creative ideas about how to do it. 
Sometimes ideas fail around here for lack of the idea.
    So, if you can suggest two or three other ways in the next 
few months that we could beef up whatever immigration bill 
passes, I'll bet you'd get a lot of support for that, and we 
need to do something about the provision in the law that makes 
a future Nobel Prize winner--American Nobel Prize winner--who 
starts out being born in India, today we make that person 
swear, before they come over here to get their graduate degree, 
that they're going home, when, in fact, it's in our interest 
for them to stay here. And, as we know, Chinese and Indian 
universities are now recruiting, back to their own 
universities, the best Chinese, Indian professors to help beef 
up their competitiveness efforts.
    Mr. Gutierrez. If I could add something, because I think 
you're touching on something very important.
    If we go back to, say, the last 50 years, some of our best 
scientists came to our country during World War II from Europe 
and they contributed immensely. We have the ability to bring 
the best brains in the world today, and we just can't let more 
time go by, because they want to do it, we can do it, there's 
no excuse for not doing it. So, I appreciate your leadership on 
this.
    Senator Alexander. Thank you, Madam Chairman. And, if I may 
say, Madam Chairman, I think if we put our minds to it, and 
we're creative, we could to any immigration bill that passes, 
more support for those bringing in people with those sorts of 
skills.
    Senator Mikulski. Mr. Gutierrez himself is an immigrant, 
and I bet when his family came here from Cuba, they didn't know 
that this was going to be a future entrepreneur that would be 
the Fortune 500 corporation, and lead a major Government 
agency, and had the ear of the President of the United States 
any time he wanted to. So, yes, immigration is a challenge.
    Senator Reed.

     MANUFACTURING EXTENSION PARTNERSHIP AND ECONOMIC DEVELOPMENT 
                         ADMINISTRATION FUNDING

    Senator Reed. Thank you very much, Madam Chairman, and 
Senator Shelby.
    Mr. Secretary, welcome, thank you.
    The Department of Commerce plays a very critical role in my 
home State of Rhode Island, I was very pleased recently when 
Admiral Lautenbacher announced that NOAA was considering the 
home porting of the Okeanos Explorer--NOAA's first ship of 
ocean exploration--in Rhode Island. And I look forward to 
working with you and the admiral to ensure this effort is 
completed.
    There are two issues I'd like to address, first is a 
manufacturing extension partnership program (MEP)--I'm 
disappointed that a cut in the program is included in the 
budget. It's absolutely critical--we all say this, 
manufacturing is such an important part in not only the 
economy, but the fabric of every community in America, I think 
we have to do more.
    And second, with respect to the Economic Development 
Administration (EDA), the proposal for the second year in a row 
to transform core programs into a regional development account, 
funded at about $170 million, to support large regional-based 
development projects. It's my understanding that the existing 
EDA program has received very high marks from the Office of 
Management and Budget (OMB) and independent analysts for their 
assistance to local communities with respect to public works, 
and economic justice, technical assistance, and I'm just 
wondering why we would abandon a proven model, and adopt this 
regional approach--at least propose it.
    Mr. Gutierrez. Yes, Senator, we're obviously committed to 
it, and we're not thinking of abandoning it. We did have to 
decide strategically as to where we put the funds. Do we invest 
in high technology, basic research, and maintain those other 
programs, as you say, which are very important--especially 
EDA--where we believe we do invest to get a return? The balance 
we found was with $170 million, we are trying to be more 
efficient by having a regional development account, so we can 
continue to contribute to these communities, while at the same 
time, put money behind the long-term research.
    I understand your concern, and this is a topic that I knew 
would come up, because MEP and EDA are both areas that warrant 
much debate. But, it was a choice that we made and we felt that 
we were looking to the longer term.
    Senator Reed. Well, Mr. Secretary, one of our--my 
concerns--is that with a regional approach you lose focus, and 
there is the tendency, I think, to--in that respect--to see 
these accounts diminish, not expand. And I think we've got to 
expand these accounts for the reasons you've suggested.
    And one of the things that's a bit perplexing is that the 
EDA proposal attempts to cut $80 million this year. A year ago 
you were requesting a $40 million increase, which would suggest 
that you were very enthusiastic about EDA--what's changed?
    Mr. Gutierrez. Well, 2 years ago, you may recall, we were 
looking at strengthening America's communities initiative, 
which would have combined the block grant programs that are in 
Housing and Urban Development (HUD) with EDA, and so we are 
actually moving more money into this model.
    What we'd like to do is look at this regional development 
account idea, develop a plan to make it more efficient--not 
just for us, but for the users--and come back with a plan, and 
share how we believe we can make it work with $170 million. We 
wouldn't go ahead and execute this without at least coming back 
and talking with major stakeholders as yourself.
    [The information follows:]
    Meeting With Senator Reed's Staff on the Efficiency of Regional 
                          Development Accounts
    Although nothing has been scheduled at this time, EDA will arrange 
for a meeting with Senator Reed's office to discuss the efficiency of 
Regional Development Accounts.

    Senator Reed. Well, Mr. Secretary, I was actually not 
impressed with the strengthening American communities approach, 
which would have put EDA proposals together with HUD funding. 
And, it looks like this budget--there's diminishing EDA, and 
the HUD budget, too, is being squeezed hard, which is not going 
to strengthen our communities. And, I think, when you go to a 
regional basis it's sort of a toss-up, who gets what, and 
again, I'm concerned--terribly concerned.
    So, I appreciate your willingness to talk about this, but 
this is something that is, again, I think we'll revisit this.
    I've mentioned before, my concerns about the manufacturing 
extension partnership centers. Dr. Jeffrey--Dr. Jeffrey will be 
testifying later, indicated there's going to be re-competition, 
because the proposed $46 million fiscal year 2008 is not 
sufficient to support the National budget? Or, that's a 
question I have--what is this re-competition about?
    Mr. Gutierrez. We haven't really honed in on re-competition 
as a solution. We obviously have to do a lot of thinking as to 
how to make the $46 million go as far as possible. Understand 
that that's one-third of the total amount; there's private 
sector and there's local money.
    But, we haven't recommended re-competition as the course of 
action. Again, we'd like to go back, think through this, and 
discuss it with you once we have a better plan in place.
    Senator Reed. Well, thank you, Mr. Secretary.
    Mr. Gutierrez. Thank you, sir.
    Senator Reed. Thank you, Madam Chair.
    Senator Mikulski. Senator Kohl.

                  MANUFACTURING EXTENSION PARTNERSHIP

    Senator Kohl. Thank you very much, Madam Chairman.
    I'm wanting, also, to discuss the manufacturing extension 
partnership account with you, Mr. Secretary. It's--and perhaps 
you're not fully familiar with it, because your job is so 
broad, so big, and has so many different pieces to it, and I 
can understand that.
    But, the manufacturing extension partnership has been a big 
success, at a relatively low cost, at preserving and creating 
more jobs in small and medium-sized manufacturing companies.
    I'm very familiar with it in my State because it's been a 
very active program, it's helped hundreds and hundreds of 
companies--many of whom I've visited--and gotten personal 
experience in seeing what they've done and listened to the 
accolades expressed by management, as well as those people who 
are MEP employees, go on to companies, seen what they've done, 
seen the results that they've produced in terms of increased 
efficiencies in these companies that have allowed these 
companies--in some cases--to come back from near bankruptcy. 
But, in many cases, just to continue to grow and produce sales 
and profits and employment. Our manufacturing jobs, which, of 
course, are critical and crucial for our economy. It's a 
success story, you know? It's something that I would hope that 
you would all talk about, and want to keep, at least at its 
present level of funding, which is $106 million, roughly $2 
million per State.
    And, as you indicate, it's complemented by State funding, 
as well as funding by the companies who use it. So, it's not 
one of these programs that we just sort of throw money at the 
wall, here at the Federal level, and hope that it may do some 
good--it is funded, as well, by the States, and the companies 
that use the service.
    I went to a company in Wisconsin over the weekend, by 
coincidence. And they're a company that is presently using the 
MEP program, and they just rave about how MEP has come in and 
helped them to improve the efficiency of their business.
    Now, in light of that, could you say something that would 
encourage us to believe that we're not going to have to go back 
to the mat again this year as we did last year and got the 
funding restored? Several of us Senators--and, you know, we 
got--it was cut last year and we got it restored to its funding 
level, and now here we come back this year, and it's cut in a 
similar fashion. And if we have to, you know, we'll fight like 
heck to get that funding back, and I hope, successfully. But, 
it would be nice if we wouldn't have to do that. And, you know, 
I'd just like to hear something from you.
    Mr. Gutierrez. I understand your concern, let me just say 
that. We're constantly faced--and we do go through this, pretty 
much, every year--we're constantly faced with the choice of 
where do we allocate the money. And we have been--especially 
over the last several years--moving more and more toward what 
we believe is the public sector's role, which is basic 
research.
    On the MEP, because we play a matchmaking-type of role, we 
try to pair up private sector needs with consultants, that 
perhaps we can continue to play that matchmaker role, more 
efficiently, more productively, without giving up on the 
program. We've got the network in place, that's not going to go 
away. So, we want to keep the program going, understand that it 
is operational in the sense that, these are companies that are 
up and running, working with consultants, trying to get better 
rates, trying to match up consultants that are more suited with 
specific companies.
    So, not giving up on the program, while being able to put 
more money behind the long-term research. As you know, when we 
make these choices, it never comes out perfectly, and there 
will be those who are not satisfied with that. But, that's sort 
of the thinking, and there's plenty of work that we need to do 
to get inside these offices and understand, how can we serve 
our customers with less money? My commitment to you is that I 
will do that and I will spend time on that, and try to stretch 
it out as much as possible.
    Senator Kohl. I'm listening, and I'm trying to understand 
and, you know, and you speak very clearly and directly, which I 
appreciate. But, here's a program that works, Mr. Secretary. It 
works. I'm, you know, sometimes we come to these sessions and 
you make out a budget and you try and cut the fat off the bone, 
which, you know--which, what we're all wanting to do, the 
programs that don't work very well. But, I have not heard you 
say--or anybody say--that this is not a program that works.
    And when you have a program that works at a relatively 
modest cost, particularly in keeping manufacturing from getting 
worse. Explain to me again, I mean, again--why try to knock 
this program off, you know, off its stool? It works. I'm 
familiar with it in my State and other States, and again--I 
don't just listen to some public relations (PR) people putting 
out a release, I've visited dozens and dozens of companies that 
have used the MEP program, and that it does work, in helping, 
and to become more efficient by bringing in--as you know--
experts who are federally funded, at least, you know, they're 
Federal employees, but they also get paid by State and--and 
they come in and they do a job in making the company more 
efficient and more effective and more profitable.
    Well, I guess I'm--I don't want to, I don't want to ask you 
to repeat what you've already said. But I--I'm surprised. 
You're a person who comes from the world of business, and so do 
I. And, I know you're concerned about dollars, and dollars 
spent, and value return for dollars spent and how important 
that is. And, I can tell you, this is a really, really good 
program, and you need to be proud of it. And that's not to say, 
``I'm proud of it, but I'm cutting its budget,'' because those 
things don't comport. If I'm proud of it, and it's a modestly 
funded program, then I'm not going to be cutting it.
    And, so somewhere in your Department, somebody's not very 
proud of it, and somebody thinks it's not a very good program. 
And, I'm here to tell you--from my experience and my knowledge 
of the program, Mr. Secretary, it is a good program. And it 
deserves your sweat and effort to keep it funded at its 
currently modest level.
    And with that, whatever you say, I will not respond and try 
to be critical, but I'd like to hear one last comment from you, 
and then I'll quit.
    Mr. Gutierrez. What I will say is there isn't a 
disagreement that there's a concept and an idea and a model 
that could work, and that has worked. We have examples of 
projects where there has been a success. Not all projects have 
been successful and, perhaps these are outside of your State, 
or in other parts of the country. Our challenge is to focus our 
money on those projects that are successful. We're trying to 
cut off the tail that isn't successful, and trying to get a lot 
better at putting the money behind those projects that do have 
a return.
    That's what I would do with the $46 million, as opposed to 
the $110 million, or $105 million. What we would try to do--is 
allocate the money to projects that do have a return, because 
there are some that don't. I think our challenge is to identify 
those, and we should have enough experience to have a better 
sense of which ones those are.
    I understand your concern. I don't think there's anything I 
could say to convince you, but we do think about these things, 
and we take up the challenge and we try to make the most of it.
    Senator Kohl. Thank you.
    Thank you, Madam Chair. Chairwoman.
    Senator Mikulski. Thank you very much, Senator Kohl. We 
appreciate the rigor of your questions, and you've expressed 
many of ours.
    Mr. Secretary, in the interest of your time and ours, we're 
not going to go to a second round of questions. We're going to 
submit them--ask our colleagues to submit them in writing. And 
we know that the international markets are rattled, and we have 
a second panel, and we want to continue before the noon hour.
    Colleagues will submit questions for the record, know that 
we will have ongoing concerns raised by members. NOAA--why 
isn't it in the competitive agenda? How we can put it in? How 
we can make sure the satellite program is back on track, the 
follow up on the patents, we'll be talking to Mr. Dudas in a 
minute or two, and then also, the census, because we're 
concerned about the security issues at the Census, and also the 
fact that as of this moment, the Director and the Deputy have 
resigned, and people are in an acting category. And, as we get 
ready for 2010, which is going to come so quickly, we've got to 
make sure that our census not only has the technology, but the 
leadership to do it.
    So, those would be the areas that I think we look forward 
to following up. So, thank you.
    Mr. Gutierrez. Thank you.
    Senator Mikulski. And, colleagues, we'll submit it for 
record.
    Thank you very much, Mr. Secretary.

                         CENSUS DEPUTY DIRECTOR

    Mr. Gutierrez. Madam Chair?
    Senator Mikulski. Yes, sir.
    Mr. Gutierrez. If I may?
    Senator Mikulski. Yes, sir.
    Mr. Gutierrez. We have named Jay Waite the permanent Deputy 
Director at Census. He is permanent, and we will bring the 
person who will be nominated for the Director job as soon as we 
have that person.
    Senator Mikulski. Well, we look forward to that and working 
with our authorizers for an expeditious confirmation. So that 
we're all going in the same direction.
    Mr. Gutierrez. Thank you.
    Senator Mikulski. Thank you very much, Mr. Secretary.
    Mr. Gutierrez. Thank you very much.
    Senator Mikulski. Until we meet again.
    Mr. Gutierrez. Thank you, thank you.

             National Institute of Standards and Technology

STATEMENT OF DR. WILLIAM JEFFREY, DIRECTOR
    Senator Mikulski. Now the Chair calls to the table, as our 
Secretary departs, the Director of NIST, Dr. Jeffrey. For the 
record, it is the National Institute of Standards and 
Technology, and also, Mr. Dudas, the head of the Patent Office.
    We're really glad to see both of you. As you can hear the 
things of the subcommittee, and the fact that we have such a 
bipartisan commitment to innovation, and you're, you're--you're 
part of the A-team on this. Both, what you provide in terms of 
research, and also service to the private sector, it's a unique 
way that this country operates, and then--that if we invent it, 
we gotta protect it. And you know the challenges there. So, 
ours is not meant to be a school-marmish hearing, but how do we 
get--help you get the results that our country really needs 
this minute?
    So, how about if we lead off with Dr. Jeffrey, and then, 
Mr. Dudas, we're going to turn to you, okay?
    Dr. Jeffrey. Thank you, Chairman Mikulski, Ranking Member 
Shelby, and members of the subcommittee.
    I am pleased to present the President's 2008 budget request 
for NIST. This is a strong budget that will further enhance our 
ability to support the measurement and standards needs of U.S. 
industry, and universities.
    NIST has a long history of being at the forefront of new 
innovations, through our measurements and standards. In 2003, 
the National Academy of Engineering identified the greatest 
engineering achievements of the 20th century. NIST measurements 
and standards were integral to the successful development and 
adoption of virtually every one. Nineteen retrospective studies 
of economic impact show that on average NIST labs generated a 
benefit to cost ration of 44:1 to the U.S. economy.
    The high rate of return results from the fact that new 
measurements or standards benefit entire industries, or sectors 
of the economy, as opposed to individual companies.
    For example, NIST researchers recently developed new 
measurement techniques that cut up to 80 percent of the cost 
and time for industry to develop advanced materials. As one 
industry scientist put it, ``NIST scientists are reawakening a 
major element of creativity that analytical science almost 
lost.''
    NIST also operates world-class user facilities. Last year 
approximately 2,000 researchers from 60 different industries 
leveraged the NIST Center for Neutron Research, or the NCNR. A 
National Academy of Sciences (NAS) report describes the NCNR's 
capability to image an operating fuel cell as ``a considerable 
achievement,'' and ``one of the most significant analytical 
advances in the fuel cell realized in decades.'' Industry 
scientists have stated that the research performed at the NCNR 
has allowed them to jump 5 years ahead in fuel cell 
development.
    To prepare for the future, NIST is working with industry to 
identify critical measurement barriers to innovation, 
evaluating its physical infrastructure, forming new and 
strengthening existing partnerships, and updating the ways it 
stimulates the knowledge transfer from its labs to industry and 
academia.
    The increased funding provided through the budget request 
will directly support innovative advances in broad sectors of 
the economy, as well as improve the safety and quality of life 
of our citizens.
    For example, the research initiatives will speed the 
development and foster the adoption of nano-technology 
products, and provide the physical measurements to ensure their 
safety, accelerate the revolutionary economic potential in 
exploiting unique properties of the quantum world, provide 
confidence and reduce uncertainty in measurements supporting 
global climate change models, reduce the risk to communities, 
as they encroach on hurricane-prone coasts and fire-prone wild 
land/urban interface regions, and enhance the safety of new and 
existing structures from the catastrophic impact of 
earthquakes.
    To meet the demands for measurements at ever-smaller 
scales, at faster rates, and with more accuracy, requires 
excellent laboratory and user facilities. The 2008 budget 
request, therefore, includes capacity and capability 
improvement at both our Boulder campus, and the NCNR.
    The budget request for MEP is identical to last year's 
request, and is a reduction of $58.3 million from the fiscal 
year 2006 enacted level. I recognize the difference in priority 
between the administration and Congress regarding the Federal 
funding level for the MEP program.
    One thing you can be absolutely certain of--regardless of 
the final appropriations, NIST will execute this program in the 
most effective manner possible, to support the Nation's small 
manufacturers.
    No funds for ATP are requested in the President's 2008 
budget. The 2006 enacted budget was consistent with the phase-
out of the program. Since the 2007 full year continuing 
resolution, however, included funding for ATP, we will be 
initiating a new competition.
    In summary, recent NIST measurements and standards research 
have enabled innovations now embedded in the IPOD, body armor--
saving the lives of domestic law enforcement officers and our 
service men and women overseas--and diagnostic screening 
devices for cancer patients, making their treatment more 
targeted and accurate. The results of NIST research can be 
found in virtually every manufacturing and service industry.

                           PREPARED STATEMENT

    For more than a century, NIST research has been critical to 
our Nation's competitiveness. The increased funding requested 
for NIST will directly support innovations in broad sectors of 
the economy that will, quite literally, define the 21st 
century.
    Thank you, and I'd be happy to answer any questions.
    Senator Mikulski. Thank you very much, Dr. Jeffrey, and we 
will be asking you questions.
    [The statement follows:]

               Prepared Statement of Dr. William Jeffrey

    Madam Chair Mikulski, Ranking Member Shelby and members of the 
subcommittee, I am pleased to appear before you today to present the 
President's fiscal year 2008 budget request for the National Institute 
of Standards and Technology (NIST). This is a strong budget for NIST 
and it will further enhance NIST's ability to support the measurement 
and standards needs of U.S. industry and universities. The fiscal year 
2008 request of $640.7 million includes $594.4 million for NIST's core 
(encompassing NIST's research and facilities) and $46.3 million for the 
Hollings Manufacturing Extension Partnership. The budget for the NIST 
core represents an 11 percent increase over the President's fiscal year 
2007 request and a 21 percent increase over the fiscal year 2007 
continuing resolution (H.J. Res. 20) recently signed by the President 
(Public Law 110-5). This funding supports NIST's mission to promote 
U.S. innovation and industrial competitiveness by advancing measurement 
science, standards and technology in ways that enhance economic 
security and improve our quality of life.
NIST's Impact on Innovation and the Economy
    NIST has a long history of being at the forefront of new 
innovations through our high-impact measurements and standards. In 
2003, the National Academy of Engineering identified 20 of the greatest 
engineering achievements of the 20th century--including automobiles, 
aircraft, lasers, computers, and the internet. NIST measurements and 
standards were integral to the successful development and adoption of 
virtually every one. Now NIST is paving the way for the greatest 
achievements of the 21st century which are still yet to be imagined.
    NIST's measurement science and standards form part of the 
foundation upon which innovation is built. Just as the Nation's 
physical infrastructure (e.g., roads or power grid) define the Nation's 
capacity to build and transport goods--the Nation has an innovation 
infrastructure which defines the Nation's capacity to innovate. And 
investment in long-term basic research like that done at NIST is an 
integral component of the innovation infrastructure. As stated in the 
National Academy of Sciences' Rising Above the Gathering Storm, ``The 
power of research is demonstrated not only by single innovations but by 
the ability to create entire new industries.''
    NIST researchers are world leaders in their fields. They frequently 
arrive at the ``cutting edge'' of science before anyone else. And once 
there, they partner with industry and academia to identify and overcome 
barriers that can slow or even halt the progress of new innovations. 
With the proposed fiscal year 2008 budget, NIST will continue 
developing the measurement and standards tools that enable U.S. 
industry to maintain and enhance our global economic competitiveness.
    NIST continues to meet the Nation's highest priorities by focusing 
on high impact research and investing in the capacity and capability of 
our user facilities and labs. This emphasis is validated by the high 
rate of return to the Nation that the NIST labs already have 
demonstrated. Nineteen retrospective studies of economic impact show 
that, on average, NIST labs generated a benefit-to-cost ratio of 44:1 
to the U.S. economy. The high rate of return results from the fact that 
new measurements or standards benefit entire industries or sectors of 
the economy--as opposed to individual companies.
    NIST supports U.S. innovation and economic competitiveness 
primarily through its measurements, standards, and national user 
facilities. Recent NIST successes highlight the importance of each of 
these critical components and illustrate how NIST's labs are able to 
return such a large benefit to the Nation:
    Measurements.--NIST researchers recently developed new measurement 
techniques that allow for rapid and cost-effective assessments of 
advanced materials that are used in a range of products from new 
detergents to improved adhesives for next-generation electronics. 
Previously, it could cost industry $20 million to develop and 
understand the characteristics of one new material. With this NIST 
measurement advance, the cost and time are estimated to have been cut 
by 80 percent. To facilitate the transfer of this technique to 
industry, NIST organized an open consortium now consisting of 23 
members that are learning to use and adapt these new measurement 
techniques. As a scientist from Honeywell International put it, ``. . . 
NIST offers an invaluable resource to show what can be done, and how to 
go about it. NIST Combinatorial Methods Center scientists are 
reawakening a major element of creativity that analytical science 
almost lost.''
    Standards.--Nanotechnology has the potential to revolutionize 
manufacturing. And one of the most promising nanomaterials is the 
carbon nanotube. Carbon nanotubes have unique electronic and mechanical 
properties that lend themselves to a variety of applications, ranging 
from the development of stronger and lighter materials to nanowires and 
transistors for miniature electronics. Regardless of the potential 
application, the quality of the materials is paramount. Unfortunately, 
current production techniques for carbon nanotubes result in products 
with high levels of uncertainty in their quality and uniformity. To 
address this concern, NIST is currently developing a carbon nanotube 
reference material. This reference material, when deployed, can be used 
by any nanotube manufacturer to validate their product's quality, 
purity, and consistency and accelerate the adoption of carbon nanotubes 
into more sophisticated devices.
    National User Facilities.--NIST operates world-class user 
facilities that benefit the entire U.S. research community. Last year, 
approximately 2,000 researchers from 60 different industries across the 
country leveraged the NIST Center for Neutron Research (NCNR). One 
recently developed application of the NCNR was to image the interior of 
operating fuel cells to help improve the efficiency and durability of 
these devices. Large and small companies involved in the manufacture or 
use of hydrogen fuel cells, including General Motors, Daimler-Chrysler, 
Dupont, and PlugPower, have benefited from this new capability. The 
NCNR is the premier facility in the world providing this capability. A 
National Academy of Sciences report describes the NIST efforts in 
regards to fuel cell technologies as ``. . . a considerable achievement 
and one of the most significant analytical advances in the membrane 
fuel cell realized in decades. The NIST facility offers the entire fuel 
cell community unique research opportunities that previously eluded 
them.'' Industry scientists have stated that the research performed at 
the NCNR has allowed them to jump 5 years ahead in terms of fuel cell 
development.
    The President recognized NIST's critical role for the Nation as 
part of the American Competitiveness Initiative (ACI). The ACI 
describes NIST as: ``. . . a high-leverage Federal research agency that 
performs high-impact basic research and supports the successful 
technical translation and everyday use of economically significant 
innovations.'' Under the ACI, overall funding for NIST's core, the 
National Science Foundation, and the Department of Energy's Office of 
Science is together slated to double by 2016.
Preparing for the Future
    The 21st century will be defined by technology innovations that 
fundamentally change the products and services available, the way they 
are manufactured and provided, and the impact on our quality of life. 
These advances will arise from basic research now beginning in, for 
example, nanotechnology, quantum science, and alternative energies--all 
areas in which NIST has a strong and increasing focus with its 
investments.
    The goal of increasing physical sciences research at NIST (along 
with that supported by the National Science Foundation and the 
Department of Energy's Office of Science) provides a unique opportunity 
to strategically establish the programs, plans, and infrastructure that 
will more than double the impact that NIST has on the economy. To 
prepare for the future, NIST is working with industry to identify 
critical measurement barriers to innovation, evaluating the capacity 
and capability of NIST's physical infrastructure, forming new and 
strengthening existing partnerships, and updating the ways it 
stimulates the knowledge transfer from its labs to industry and 
academia.
    For example, over the past year, NIST worked with over 1,000 
experts from industry and universities to identify measurement barriers 
to innovation in a number of critical industry sectors. Over 700 
technical barriers were identified, analyzed, and documented in a 
report. NIST is now in the process of working with industry, 
universities, and other government agencies to address many of these 
identified barriers over the coming years.
    In terms of facilities, NIST has conducted a rigorous evaluation of 
its laboratory capacity and capabilities on its Boulder, Colorado, 
campus. This review found facilities' shortfalls in our ability to meet 
both current and projected industry and university needs in a number of 
important areas. Examples include the high-speed and high-frequency 
measurements required for electronics, defense, and homeland security; 
measurements and tests at the single atom level; and improved methods 
for measuring time, an area expected to vastly improve navigation and 
positioning systems. Each technical area was evaluated in terms of 
necessary laboratory conditions (to include stability of temperature, 
vibration, and humidity, as well as air cleanliness). As a result of 
this assessment, new laboratory space to meet the nation's needs well 
into the 21st century is proposed in the fiscal year 2008 budget 
(Boulder Building 1 Extension).
    NIST also serves industry and academia by being a steward of world-
class user facilities. As part of the ACI, NIST identified two 
important opportunities first called out in the fiscal year 2007 budget 
and enhanced in the fiscal year 2008 budget--increased capacity and 
capability of the NIST Center for Neutron Research and creation of the 
NIST Center for Nanoscale Science and Technology. Both of these 
facilities are designed to stimulate progress in support of our 
Nation's economic competitiveness.
    The ACI provides NIST the opportunity to further promote U.S. 
innovation and industrial competitiveness. With focused, world-class 
research and facilities, NIST will have a greater impact on the 21st 
century economy than it did even over the past century.
Fiscal Year 2008 President's Budget
    The increased funding provided through the fiscal year 2008 request 
will directly support innovative advances in broad sectors of the 
economy as well as improve the safety and quality of life for our 
citizens. The following table summarizes the proposed fiscal year 2008 
budget. In this table we show both the fiscal year 2007 President's 
budget and the fiscal year 2007 continuing resolution (Public Law 110-
5) for comparisons as different baselines.

                           BUDGET SUMMARY SHOWING BOTH FISCAL YEAR 2007 PRESIDENT'S REQUEST AND PUBLIC LAW 110-5 AS BASELINES
                                                                [In millions of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Fiscal Year 2007
                                                               Fiscal Year 2007      Continuing     Fiscal Year 2008   Change Between    Change Between
                                                                  President's        Resolution        President's    Fiscal Year 2008  Fiscal Year 2008
                                                                    Request       (Public Law 110-       Request       and Fiscal Year   and Public Law
                                                                                       5) \1\                           2007 Request          110-5
--------------------------------------------------------------------------------------------------------------------------------------------------------
STRS (Labs)..................................................             467.0              432.8             500.5             +33.5             +67.7
CRF (Facilities).............................................              68.0               58.7              93.9             +25.9             +35.2
                                                              ------------------------------------------------------------------------------------------
    Core Subtotal............................................             535.0              491.4             594.4             +59.4            +102.9
                                                              ------------------------------------------------------------------------------------------
ITS (MEP + ATP) Subtotal.....................................              46.3              183.6              46.3  ................            -137.3
                                                              ------------------------------------------------------------------------------------------
    TOTAL....................................................             581.3              675.1             640.7             +59.4             -34.4
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Totals for fiscal year 2007 do not include the 50 percent of the pay raise that was included in Public Law 110-5.

    The fiscal year 2008 budget was formulated with the fiscal year 
2007 President's request as the baseline. Since Public Law 110-5 
provides a smaller budget for the NIST core (STRS and CRF) than the 
fiscal year 2007 President's request by $43.6 million, some proposed 
initiatives in fiscal year 2007 that will not receive full funding are 
implicitly contained within the President's fiscal year 2008 request. 
New initiatives and program increases are described in more detail 
below:
Scientific and Technical Research Services (STRS)
            Enabling Nanotechnology From Discovery to Manufacture (+$6 
                    Million)
    The potential market for products containing nanomaterials is 
estimated at over $1 trillion by 2015. Because of their small size--a 
thousand times thinner than a human hair--nanoscale products require 
entirely novel ways to characterize their physical properties and fully 
exploit their unique characteristics in the manufacture of new 
products.
    In fiscal year 2007, NIST began a major initiative to address the 
measurement barriers hindering rapid development of nanotechnologies. A 
new NIST Center for Nanoscale Science and Technology (CNST) has been 
established that combines both research and a state-of-the-art 
nanofabrication and nanometrology user facility.
    The research initiatives proposed in fiscal year 2008 will build on 
recent NIST advances by:
  --Developing ways to measure strength, stress, strain, optical, and 
        electronic properties of nanostructures to improve processes 
        and understanding of failure mechanisms;
  --Creating three-dimensional, high-resolution imaging methods that 
        reveal details of structure, chemical composition, and 
        manufacturing defects and allow researchers to view 
        nanostructures as they interact with their environment;
  --Simulating nanoscale phenomena with computer models to allow 
        economical development of production methods for complex 
        nanodevices; and
  --Producing the measurement techniques required to address the 
        interagency efforts to characterize nanotechnology impacts to 
        our health, safety, and environment.
            Measurements and Standards for the Climate Change Science 
                    Program (+$5 Million)
    The climate is changing. Determining how fast it is changing, and 
understanding the complex relationships between all the environmental 
variables is a critical objective of the U.S. Climate Change Science 
Program. Many different climate monitoring systems in space, in the 
air, and on the ground are currently monitoring solar output as well as 
trapped and reflected heat by the Earth's atmosphere. These systems are 
operated by many countries and research groups. Establishment of 
absolute calibration and standard references will allow accurate 
intercomparisons of these systems, will help identify small 
environmental changes occurring over many years, and will reduce 
uncertainties in the data input to global climate change models.
    With the proposed fiscal year 2008 funding, NIST will, working in 
coordination with other agencies, develop:
  --An international irradiance measurement scale to be used in 
        rigorously calibrating satellite light intensity instruments 
        prior to launch to ensure sufficient accuracy to allow valid 
        comparisons among results from different instruments or from 
        data sets taken over different periods of time;
  --New instrument design strategies and quality assurance programs to 
        optimize accuracy and stability of satellite-based irradiance 
        measurement systems;
  --Techniques for generating specific types of aerosols in the 
        laboratory, measuring aerosol optical and physical properties, 
        and for simulating aerosol properties that cannot yet be 
        measured in the laboratory; and
  --A database of critically evaluated data on aerosol properties 
        collected at NIST and elsewhere.
            Enabling Innovation Through Quantum Science (+$4 Million)
    Unlike the laws of physics that govern our ``every day'' world, the 
laws of physics that govern the quantum world of atoms, electrons, and 
light particles are fundamentally different. These quantum particles 
are able to interact in ways that according to human experience would 
seem impossible. For example, a quantum particle can actually be in two 
different places simultaneously.
    Conceptualizing these phenomena is difficult to say the least, but 
developing ways to exploit them for the development of technologically 
significant innovations is even more challenging. NIST, however, has 
world-class scientists who are leaders in the emerging field of quantum 
information science. Three NIST scientists have won Nobel Prizes in the 
last 10 years based on their work in this field. Many of the best minds 
in physics today believe that applications of quantum science will 
transform the 21st century just as integrated circuits and classical 
electronics revolutionized the 20th century.
    The proposed fiscal year 2008 initiative will build upon NIST's 
significant expertise in this area, and leverage the collaborations 
established in the recently created Joint Quantum Institute between the 
University of Maryland, NIST, and the National Security Agency. NIST 
proposes to accelerate the potential of the quantum world for enhancing 
our nation's competitiveness through research into:
  --Quantum ``wires'' that use ``teleportation'' techniques to reliably 
        transport information between the components of a simple 
        quantum computer;
  --Quantum memory analogous to the random access memory of today's 
        computers to allow more complex logic operations;
  --Quantum conversion processes that transfer information from one 
        form of quantum information to another (for example, ways to 
        transfer information about the quantum characteristics of an 
        atom to a photon); and
  --Quantum based measurement tools such as optical clocks and single 
        electron counters.
            Disaster Resilient Structures and Communities (+$4 Million)
    The past few years have reminded us that both natural hazards--
including extreme winds, storm surge, wildland fires, earthquakes, and 
tsunamis--as well as terrorist actions, are a continuing and 
significant threat to U.S. communities. The disaster resilience of our 
physical infrastructure and communities today is determined in large 
measure by the building codes, standards, and practices used when they 
were built. Many of these legacy codes, standards, and practices--which 
have evolved over several decades--are oversimplified and inconsistent 
with current risk assessments. As construction and rebuilding costs 
continue to rise, there is increasing recognition of the need to move 
from response and recovery to proactively identifying and mitigating 
hazards that pose the greatest threats.
    The proposed fiscal year 2008 initiative will, working in 
coordination with other agencies, develop:
  --Standard methods to predict losses, evaluate disaster resilience, 
        and estimate cost-to-benefit of risk management strategies at 
        the community and regional scales that local officials can use 
        to evaluate and mitigate risks via land-use planning and 
        practices;
  --Decision support tools to modernize codes, standards, and practices 
        consistent with the risk;
  --A validated ``computational wind tunnel'' for predicting extreme 
        wind effects on structures; and
  --Risk-based storm surge maps for the design of structures in coastal 
        regions.
            National Earthquake Hazards Reduction (+$3.25 Million)
    Many earthquakes strike without warning. Within the United States, 
more than 75 million people are located in urban areas considered to be 
of moderate to high risk of earthquakes. Just the economic value of the 
physical structures within these regions--not including the potential 
loss of life and economic disruption--is valued at close to $8.6 
trillion. To address this threat Congress has provided longstanding 
support for the National Earthquake Hazards Reduction Program which 
NIST coordinates across the Federal government.
    This initiative will enhance the safety of:
  --New structures by establishing and promoting performance-based 
        standards for entire building designs and by accelerating the 
        adoption of basic research into the model building codes, 
        standards, and practices; and
  --Existing structures through research on actual building performance 
        in earthquakes; developing structural performance models and 
        tools; and establishing cost-effective retrofit techniques for 
        existing buildings.
Construction of Research Facilities (CRF)
            Building 1 Extension (B1E)--Enabling Sustained Scientific 
                    Advancement and Innovation (+$28 Million)
    When President Eisenhower dedicated the NIST facilities in Colorado 
in 1954, no one imagined that half a century later scientists would be 
manipulating matter atom-by-atom. Such technological advances require 
increasingly complex and difficult measurements--to be able to observe, 
characterize, and create structures at ever smaller spatial scales. As 
the structures shrink in size, small fluctuations in temperature, 
humidity, air quality, and vibration begin to distort the results. We 
are now at the point where laboratory conditions are inhibiting further 
advances in some of the most promising areas of research for the 21st 
century.
    The $28 million proposed in the fiscal year 2008 budget will 
leverage previously proposed funds ($10.1 million) in the fiscal year 
2007 budget to construct state-of-the-art laboratory space that will 
meet the stringent environmental conditions required for 21st century 
scientific advances. An additional $38.1 million will be needed in 
fiscal year 2009 to complete the project. With a total cost of $76.2 
million, the Building 1 Extension is the most cost-effective approach 
to enabling world-class measurement science in support of some of the 
country's most important economic sectors.
            NIST Center for Neutron Research (NCNR) Expansion and 
                    Reliability Improvements (+$19 Million)
    The NCNR is widely regarded as the most scientifically-productive 
and cost-effective neutron facility in the United States, and serves 
more scientists and engineers than all other U.S. facilities combined. 
Neutron scattering techniques, in which beams of neutrons are used as 
probes to see the structure and movements of materials at the smallest 
scales are critical in a wide range of applications that will define 
the 21st century including nanotechnology, alternative energies, and 
understanding the structure of biological molecules. Because of the 
unique properties of neutrons for probing materials and their 
applications to some of the most advanced technologies, a significant 
shortage of neutron beam capacity and capability exists in the United 
States to satisfy the demands of industry and academia.
    This initiative begun in fiscal year 2007 is the second-year of a 
planned 5-year program to expand significantly the capacity and 
capabilities of the NCNR. The program includes the development of a new 
neutron cold source together with a new hall to house the guide tube, 
modernization of the control system, and five new world-class neutron 
instruments. The specific fiscal year 2008 funding will complete 
construction of the new guide hall.
Industrial Technology Services
            Hollings Manufacturing Extension Partnership (MEP) ($46.3 
                    Million--No Change from Fiscal Year 2007 
                    President's Request; -$58.3 Million From Public Law 
                    110-5)
    The MEP program is a partnership between the Federal Government and 
local officials to provide assistance to small and medium sized 
manufacturers around the country. Surveys taken of companies 1 year 
after receiving MEP assistance indicate a significant financial benefit 
accrued to the individual company.
    The Federal Government is an important partner in the MEP program. 
Specifically, the Federal Government:
  --Develops new services and programs in response to the evolving 
        manufacturing environment and propagates them throughout the 
        network;
  --Evaluates and ensures high-quality performance of every member of 
        the network; and
  --Ensures that small manufacturers remain the focus of the effort.
    The above Federal role can be accomplished within the requested 
budget. The reduction of Federal funds to the local centers may have to 
be compensated through a combination of increased fees derived from the 
benefits accrued by individual companies and cost-savings in the 
operations of the centers.
            Advanced Technology Program (ATP) ($0--No Change From 
                    Fiscal Year 2007 President's Request)
    No funds for ATP are requested in the President's fiscal year 2008 
budget. The fiscal year 2006 enacted budget and the 109th Congress' 
House mark and Senate Appropriations committee mark were consistent 
with the phase-out of the ATP program. The last new awards were made in 
2004 and sufficient funds were available in the carryover to complete 
all awards and provide government oversight.
    The fiscal year 2007 Continuing Resolution (Public Law 100-5) 
recently signed by the President included funding for the ATP program. 
NIST will work with Congress to ensure the funds are executed in the 
most effective manner to promote U.S. industry's competitiveness.
Summary
    Measurements and standards are the bedrock upon which any economy 
stands. Our founding fathers recognized this. The Constitution assigns 
the Federal Government responsibility to both issue money and to ``fix 
the standards of weights and measures.'' The two are actually more 
similar than they might seem at first glance.
    All economic transactions rest fundamentally on trust--trust 
between two parties that a given amount of something is worth a given 
amount of something else. Helping to create that trust for innovative 
new technologies is the common theme that runs through all of NIST's 
proposed fiscal year 2008 research initiatives. Each helps build a 
missing or inadequate measurement base--a rigorous, accepted way of 
quantitatively describing something--that improves confidence in 
scientific results or improves the quality, reliability or safety of 
innovative products. Recent NIST measurements and standards research 
have enabled innovations now embedded in the iPod, body armor currently 
saving the lives of domestic law enforcement officers and our service 
men and women overseas, and in diagnostic screening devices for cancer 
patients making their treatment more targeted and accurate. The results 
of NIST research can be found in virtually every manufacturing and 
service industry.
    For nearly 106 years, NIST research has been critical to our 
Nation's current and future competitiveness. The increased funding in 
the President's fiscal year 2008 budget for the NIST core will directly 
support technological advances in broad sectors of the economy that 
will quite literally define the 21st century--as well as improve the 
safety and quality of life for all our citizens.

                    U.S. Patent and Trademark Office

STATEMENT OF JON W. DUDAS, DIRECTOR
    Senator Mikulski. Mr. Dudas, why don't we welcome you, and 
look forward to hear from you and your protecting intellectual 
property.
    Mr. Dudas. Thank you, Madam Chairwoman.
    Thank you ranking member Shelby, and Senator Alexander.
    I appreciate this opportunity to share with you the things 
we're doing at the USPTO, and I also recognize I have a 
responsibility--and it's even clearer now--a responsibility to 
the employees of the USPTO to do a better job, not only talking 
about the challenges we face, but communicating the successes 
that our employees have had at the USPTO. So, I really do 
welcome this as an opportunity.
    And with that, I think I'll just cut to the chase and say, 
on behalf of the 8,500 of my colleagues at the USPTO, I'm truly 
proud to report that the women and the men of the USPTO 
delivered results in 2006 in, literally, record proportions. 
Last year, the USPTO set 11 all-time agency-wide records, 
including the highest quality in the history in trademarks, the 
second highest quality in history in patents, the highest 
production in history in both patents and trademarks, the 
highest hiring of examiners in history, in both patents and 
trademarks, the highest electronic processing, and electronic 
filing in history in both patents and trademarks, and allowing 
more examiners than ever before to work from home. Eighty-five 
percent of trademark examiners, and 500 new patent examiners 
were working from home last year.
    In 2006, we were also chosen by Business Week magazine as 
one of the best places in America to launch a career, and we 
were featured in Business Week magazine as a premier place to 
round out one's career. One of our examiners, who is 66 years 
old was featured in Business Week as, again, a place to round 
out your career.
    And USPTO examiners not only succeeded on behalf of the 
United States on protecting innovation, they succeeded 
personally and professionally. Sixty percent of all patent 
examiners, and 70 percent of all trademark examiners exceeded 
their goals in production and quality, or production or 
quality, and received an additional bonus for exceeding those 
goals.
    Thanks is owed, first and foremost, to these loyal and 
determined employees of the USPTO, and in our office hangs a 
banner, seven stories high, that says, ``Celebrating 2006, Our 
Record-Breaking Year.'' We held an 8,500 person, all-hands 
celebration, where senior executives served the rest of our 
colleagues a thank you lunch, a well-deserved thank you lunch, 
for breaking those records.
    Simply put, these results would not have been possible 
without this subcommittee allowing all innovators' fees to be 
used to fund determination of their innovations. The years 2005 
and 2006 were the first 2 years in more than 15 years, that the 
USPTO operated under full funding, and the difference has been 
dramatic. Since Congress passed the Government Performance and 
Results Act to hold Government agencies accountable and report 
their metrics, and hold them accountable, the USPTO, on 
average, had only met about 25 percent of their key goals.
    Under the Government Performance and Results Act, just last 
year, after full funding, an appropriate strategic plan, new 
methods in place, responding to some of the reports you've 
mentioned, we moved to 90 percent of our goals met. There's one 
we missed, we should meet it, we should be at 100 percent of 
our key goals, and our overall goals, we've met 94 percent of.
    In 2007, you again provided full funding, and we look 
forward to working with this subcommittee, to make this a 
permanent policy.
    This subcommittee has helped the USPTO come a long way, but 
as you point out, there are real challenges that lie ahead. 
Continuing to attract and retain the finest public servants is 
a growing challenge. Our employees are at the heart and soul of 
our intellectual property system, and we need to do everything 
we can possibly do to ensure they have an environment of 
respect, and an environment of opportunity.
    The Business Week magazine article I talked to before, 
reported that the most favored employers in the United States--
not the average, but the most favored employers in America--are 
losing about one-third of their new hires within the first 3 
years of employment. The USPTO is experiencing similar 
attrition in the first 3 years. And with the record hiring we 
have done, that pushes our overall attrition to slightly above 
what the average has been. That's something we need to, again, 
focus more on, and I can share with you some of the things 
we're doing.
    The pendency of application also continues to be a 
challenge. Despite record-level hiring, and record-level 
production increases in both patents and trademarks last year--
19 percent increase in trademarks, and a 17-percent increase in 
patents, in terms of production--and an already demanding 
environment for examiners, we continue to receive applications 
at a record that exceeds our capacity to examine. We've simply 
broken records in the number of applications we've received for 
over 20 years now.
    The answers there lie, in large part--and I think this is 
some of what we'll talk to you about in the plan--in asking for 
more and better information. Not just from our examiners--we 
recognize that the USPTO owes a whole lot, and that our 
examiners are the finest in the world--but we need to get more 
and better information from applicants themselves, and from the 
public at large. And those are some of the strategies that can 
increase productivity, and increase production.
    To that end, I'd like to share with you that we introduced 
a system of accelerated examination last year. Under this 
program, for those applicants--any applicant, any technology, 
from anywhere--who want quick turnaround, the USPTO now offers 
a complete examination within 12 months. An applicant can 
literally reduce their time to 12 months as of August 26, 2006.
    In exchange for this quick turnaround, we don't ask for a 
whole lot more money, but what we ask is that applicants file a 
complete application. That they give us meaningful and quick 
turnaround. That they file electronically, so things can be 
more efficient. And importantly, they give us search reports 
and information that will help our examiners become more 
efficient and more proficient.
    The first application to be completed under this program 
will issue this month, and it will issue in less than 6 months.
    Thank you, again, for this opportunity to discuss the 
progress the USPTO has made, and importantly, the challenges 
that we still face. I look forward to working with this 
subcommittee to make the best intellectual property system in 
the world even better.
    Please accept my invitation--if you have an opportunity--to 
come down and visit the USPTO, an open invitation to any and 
all of you to meet with the examiners, to share in the success. 
I can just tell you, anecdotally, the very best ideas we've had 
have come from opening communication more with employees, the 
people who are on the ground, doing the work, who have the very 
best ideas. And I think that's where you'll find the solutions 
that you're looking for.
    Thank you.

                           PREPARED STATEMENT

    Senator Mikulski. Thank you very much, Mr. Dudas, and also 
Dr. Jeffrey.
    [The statement follows:]

                   Prepared Statement of Jon W. Dudas

    Chairwoman Mikulski, Ranking Member Shelby, and members of the 
subcommittee: Thank you for this opportunity to appear before you to 
discuss the United States Patent and Trademark Office's (USPTO) 
operations, programs and initiatives and the President's fiscal year 
2008 budget request to fund those efforts.
    I first want to take this opportunity to thank this subcommittee 
and your colleagues on the House side for ensuring that our current fee 
schedule remains in effect for fiscal year 2007. We look forward to 
working with you to make that fee schedule permanent.
    We are also pleased that the fiscal year 2008 budget request gives 
the USPTO full access to the $1.9 billion in fees we expect to collect. 
This is the fourth consecutive year that the President's budget 
recommends full access to collected fees, and we appreciate the 
continued congressional support for that funding level.
    Full access to user fees allows the USPTO to continue our 
successful model of disciplined focus on real measures that enhance 
quality and increase production, increase hiring and training, promote 
electronic filing and processing, provide telework opportunities for 
our employees and improve intellectual property protection and 
enforcement domestically and abroad.
    As we entered the 21st century, the USPTO faced a number of 
challenges, all of which are well known to the subcommittee. We did not 
have access to all of our fee collections, our workload in patents was 
growing at record and unanticipated rates, and there existed the 
perception that patent examiners did not produce high quality work 
while management ignored the growing backlog of patent cases and acted 
to erode employee morale. Indeed, 6 months before I entered the USPTO 
as the Deputy Under Secretary, this subcommittee had communicated its 
strong concerns with the agency in its report:

    ``The ability of the administration to formulate an adequate budget 
for the PTO is complicated by two factors. First, the agency 
historically has formulated an incremental budget based on the previous 
year's budget, and does not provide the committee with a thorough 
business plan that demonstrates how resources will be used and what 
results will obtain. Second, PTO management has not been sufficiently 
innovative. * * *  Finally, the committee lacks full confidence in the 
information provided to it by PTO management regarding its needs and 
performance.'' Senate Report 107-42.

    This subcommittee's concerns weighed heavily on the USPTO. As 
Deputy to Under Secretary Rogan, and upon assuming responsibility for 
the USPTO as Under Secretary in January 2004, I made commitments to the 
administration, the Congress, our stakeholders and my dedicated 
colleagues at the USPTO to address these issues. I made specific 
promises, namely, that: we would make quality our number one priority; 
we would control pendency by increasing production; we would ``hire 
more, train better, retain better and telecommute''; we would make 
patent processing fully electronic; we would protect the U.S. 
intellectual property system and American interests internationally; 
and we would reaffirm the USPTO's credibility within the administration 
and with the Congress.
    We made promises, and we have kept those promises. Thus, I am 
pleased to be able to share with you today the real, measurable 
successes the USPTO has achieved. The women and men of the USPTO, my 
colleagues, delivered results in record proportions in fiscal year 
2006. Last year, the USPTO set 11 all-time agency records, including: 
highest quality in history, highest production in history, highest 
hiring of examiners in history, highest electronic processing and 
electronic filing in history and allowing for more examiners than ever 
to work from home-saving them precious time and the rest of us space on 
the roads. In 2006, we were also chosen by Business Week magazine as 
one of the best places in America to launch a career. I can further 
promise you that the men and women of the USPTO will not rest on our 
accomplishments while we have so many things we still want to achieve.
    This subcommittee has made USPTO's recent successes possible. This 
is our third year operating under the new patent and trademark fee 
schedule, which provides funding appropriated by the subcommittee. The 
reliable fee schedule permits us to finance the initiatives--
particularly initiatives requiring long-term planning and commitment--
so necessary to providing and maintaining reliable, functioning 
systems. Without your support, we would not be able to function in a 
business-like manner and achieve these results.



     USPTO--Percent of Performance Goals Met Under the Government 
                  Performance and Results Act of 1993

    Our success has been accomplished in the following manner. We have 
spent the last 4 years concentrating on meeting or exceeding objective 
measures, as required by the Government Performance and Results Act of 
1993 (See chart above).
    This requires continual assessments that identify system-wide 
process improvements. We use relevant metrics and measures to gauge 
progress and as early warning of deviations that indicate a need for 
process adjustment. Our record reflects the hard work and sound 
decisions of more than 8,000 USPTO employees. We are now seeing the 
results of their efforts.
Quality
    We have focused our attention on improving quality. Public 
confidence in the quality of our patent grants and trademark 
registrations is critical. Confidence is earned, and we do not take it 
for granted. At the USPTO, we believe the essential components of 
quality are accuracy and consistency. We must ensure that allowed 
applications meet both statutory and regulatory standards, thus 
providing the certainty that enhances competition in the marketplace. 
We must not allow the need for timeliness to adversely impact the 
requirement for quality. Last year, despite receiving a record level of 
patent applications, we achieved the highest patent allowance 
compliance rate in nearly a quarter century at 96.5 percent. Our 
trademark organization had a final compliance rate of 96.4 percent--the 
best rate since we began measuring quality.
Human Resources
    In September 2006, Business Week identified the USPTO as one of the 
best places in America to launch a career. The USPTO has also been 
lauded by Families magazine as one of the best places in the 
Washington, DC area to work if you have a family. These results are due 
in part to the fact that the USPTO seriously addressed the audit 
findings involving our past human resources practices.
    We are now attracting and hiring record numbers of employees--at a 
rate of 1,200 new patent examiners a year. We started a new, university 
style approach to training, which allows us to deliver intensive, 
balanced and long-term training to newly-hired examiners. We now offer 
bonuses to hire and retain talented engineers and scientists in certain 
critical fields.
    An achievement of which we are also proud is the number of patent 
examiners who have joined their trademark counterparts in working from 
home. Our 10 year old Telework program is the gold standard and has 
proven to be a key quality-of-life benefit for increasing employee 
morale and retention, and now 500 patent examiners per year have chosen 
this route.
    In 2006, we also had the first ever management conference for all 
of the USPTO's 800 managers. For 2 days, our managers attended seminars 
and collaborated on best practices of how to best manage the highly 
skilled and dedicated workforce at the USPTO. On November 1, 2006, we 
also held an agency-wide ``thank you'' event for all of the USPTO's 
8,000 plus employees. Senior executives served lunch and thanked our 
colleagues for making 2006 a record-breaking year. At the management 
level, we also have started to implement our long-term Strategic Human 
Capital Plan.
Electronic Government
    Our commitment to e-Government has been unequivocal. In March 2006, 
we unveiled ``EFSWeb,'' the first-ever, user-friendly, Internet-based 
patent application and document submission system. Since last March, 
electronic filing of patent applications has skyrocketed from the 1 
percent rate of fiscal year 2005, to almost 40 percent filings today. 
In other words, in less than a year, almost 40 percent of our patent 
applications are now filed electronically, via the Internet. Last year, 
94 percent of trademark applications were filed electronically, and we 
recently celebrated receipt of electronic trademark application number 
1,000,000.
International IP
    On the global level, we continue spreading the word about 
protecting and respecting intellectual property, both domestically and 
internationally. We are fully engaged in the Bush Administration's 
Strategy Targeting Organized Piracy (STOP!) in the fight against piracy 
and counterfeiting around the world. We hold intellectual property 
awareness conferences, with a focus on small-businesses, all around the 
country. More than 90 percent of the attendees have rated these 
programs as good or excellent, and it has been described by at least 
one participant as ``the best use of my taxpayer dollars.'' Some of our 
conferences focus exclusively on doing business in China, from an 
intellectual property perspective.
    The USPTO has the lead for the United States in discussions and 
negotiations to strengthen global intellectual property protection 
throughout the world. We operate the Global Intellectual Property 
Academy, which offers intensive patent, trademark, copyright and IP 
enforcement training for foreign government officials and private-
sector representatives from around the world. Finally, we have placed 
intellectual property experts in Brazil, China, Egypt, India and 
Thailand, to advocate for improved intellectual property protection 
that benefits all, including our American businesses.
Production and Productivity
    The rate of filing of applications in the United States continues 
to break records every year. The USPTO's core business continues to 
grow at a steady pace. In fiscal year 2006 we received 419,760 UPR 
(utility, plant and reissue) patent applications and expect an increase 
of 7 percent in fiscal year 2007 followed by an anticipated annual 
increase of 8 percent in fiscal year 2008 through fiscal year 2012. In 
the trademarks area, we received 354,775 applications and expect an 
increase of 6 percent in fiscal year 2007 followed by an 8 percent 
increase in fiscal year 2008. Trademark applications are anticipated to 
increase by 7 percent in fiscal year 2009 and increase 6 percent each 
year from fiscal year 2010 through fiscal year 2012.
    This is a strong sign of growing innovation and investment in the 
United States, but it also represents potential strains on the system. 
The USPTO has the highest productivity of any major IP office in the 
world. The USPTO processes and examines more patent applications and 
more trademark applications than any other office in the world. Based 
on the latest statistics, the USPTO also has the lowest pendency of any 
other major office in the world. In addition, 2006 was a record year 
for production--from 2005 to 2006 production increased 18 percent in 
trademarks and 16 percent in patents.
    Even with the success we have had increasing production and hiring, 
the volume of patent applications continues to outpace our capacity. 
Even with 1,200 new hires each year through 2012, pendency, which 
averages about 31 months now, will be nearly 39 months in 2012. Of 
course, hiring is critical--without that plan, pendency would be more 
than 50 months in 2012. However, as this subcommittee has noted, hiring 
alone is simply not enough. As a result, the USPTO's Strategic Plan 
released this year places a high emphasis on increasing productivity in 
the USPTO and in patent systems throughout the world by leveraging the 
work that is being done in other offices, by applicants themselves and 
from interested parties in the public.
    While increasing productivity, we must take into account the 
incredible demands placed upon our examiners to issue on the highest 
quality results in an increasingly demanding world. The inventions for 
which patent protection is sought are becoming more technically 
complex. Complex technologies take more time to examine and make up an 
ever-greater percentage of applications. For the average application, 
an examiner now has to review 50 percent more claims and 300 percent 
more background literature. At the same time, the mix of more 
experienced, more productive examiners to less experienced, less 
productive examiner varies every year, as does the production loss to 
train new examiners. For these reasons, patent productivity (the number 
of patent applications examined per examiner per year) has been 
steadily decreasing from 101 in 1993 to 78 in 2006.
    These are challenges that we can and will overcome. In trademarks, 
the USPTO increased productivity by 7 percent in fiscal year 2006 after 
negotiating a new performance plan. Although the trademark examiners 
union expressed good faith concerns that the vast majority of trademark 
examiners would fail under increased production and quality 
requirements, examiners flourished when given this opportunity to 
succeed--70 percent of trademark examiners earned a production bonus 
and the number of trademark examiners who received an ``Outstanding'' 
or ``Commendable'' rating grew by nearly 10 percent.
    We are adopting a number of strategies in the patents area as well. 
The USPTO expects to increase productivity in patents by offering 
examiners more opportunities to determine their workload and achieve 
higher bonuses. The USPTO is piloting a voluntary flat goals program 
for patent examiners that builds upon the successful system in 
trademarks.
    We are trying a variety of innovations, including a new offering 
for the public, called ``Accelerated Examination.'' Under this program, 
which began August 26, 2006, for those applicants who need or want 
quick turn around, the USPTO offers a complete examination within 12 
months. In exchange for this quick turn around, applicants must file a 
complete application, agree to telephone interviews and accelerated 
response periods, must file and prosecute their application 
electronically and must provide more information about the application 
to the USPTO in the form of a search and a support document. The first 
application to be completed under this program was filed on September 
29, 2006 and will issue on March 13, 2007 (less than 6 months from date 
of filing).
    While the significant growth in patent and trademark applications 
indicates that innovation and entrepreneurship are alive and well, it 
presents our agency with a variety of challenges. We plan to use the 
following strategies to address these challenges which are included in 
USPTO's fiscal year 2008 budget request.
            Strategy #1: Hiring, Retention
    The USPTO hired a record 1,218 patent examiners in 2006, exceeding 
our hiring goal by more than 200 examiners. The USPTO plans to hire 
1,200 patent professionals a year in fiscal year 2007 through fiscal 
year 2012 for a total of at least 8,400 patent examiner new hires by 
end of year fiscal year 2012.
    Since more experienced examiners naturally are able to review cases 
faster, and in an excellent manner, the USPTO has implemented a program 
of recruitment bonuses to hire and retain the talented engineers and 
scientists we need to examine our increasingly complex applications. We 
are reviewing other possible programs to help us compete with industry 
for professionals in the ``hot'' technology sectors. We want to be an 
``employer of choice'' to the pool of tech professionals.
            Strategy #2: Training
    In fiscal year 2006, the USPTO implemented a university approach to 
training new examiners. The university method provides training to new 
examiners in a classroom setting for 8 months, rather than using the 
traditional one-on-one training model. This allows us to deliver 
intensive training to the new hired examiners, leaving more experienced 
examiners and supervisors to focus on quality examination. In fiscal 
year 2006, 123 examiners completed the university's 8-month program. So 
far in fiscal year 2007, a total of 225 new examiners completed 
training, with an additional 293 examiners slated to graduate by the 
end of the fiscal year.
            Strategy #3: Quality Initiatives
    In fiscal year 2008 and beyond, patents will use a number of 
strategies to improve quality, such as:
  --leveraging the effectiveness of the Patent Training Academy to 
        enhance examiner skills;
  --creating chief scientist positions;
  --designing and implementing a comprehensive quality system to 
        collect and analyze all quality review information for 
        consistency and to provide feedback and improved training;
  --offering a separate quality award that better recognizes the 
        accomplishments of examiners who meet or exceed quality 
        expectations;
  --conducting targeted reviews in problem areas which focus on 
        examination processes or functions that show problematic 
        trends; and
  --encouraging submissions of prior art by participating with a 
        consortium of patent users, applicants, attorneys, and members 
        of the academic community to build a system to actively solicit 
        prior art.
    Trademarks will continue quality improvements by increasing the use 
of quality review findings, analyzing and incorporating the results in 
training, examination guidelines, policies and manuals. In addition, 
trademarks will create comprehensive new employee training programs, 
and explore the creation of web-based search tools, data mining, and 
automated preliminary searches so that examining attorneys can search 
more effectively.
            Strategy #4: E-Government
    The USPTO promotes electronic filing of applications. In fiscal 
year 2006, 94 percent percent of trademark applications and 14 percent 
of patent applications were filed electronically. Trademarks and patent 
programs estimate that rates of electronic submission of new 
applications will continue in fiscal year 2007, at 90 percent and 40 
percent respectively. In fiscal year 2008, patents expects to receive 
50 percent of all patent applications electronically, while trademarks 
will hold at approximately 90 percent or above of applications filed 
electronically.
    Trademarks is continuing to enhance electronic filing by expanding 
the number and type of transactions offered on-line and by offering 
reduced fees to any applicant who files a complete applications using 
the newer system, the Trademark Electronic Application System-Plus 
(TEAS-Plus).
    Patents implemented the Electronic Filing System-Web (EFS-Web), a 
user friendly, Internet-based patent application and document 
submission solution. This system dramatically increased the electronic 
filing of patent applications from 1.5 percent per month to 33 percent 
per month at the end of fiscal year 2006. This easy to use system will 
continue to encourage applicants to file electronically.
    Patents is developing the electronic Patent File Wrapper (PFW) as 
the solution to several business problems. PFW in conjunction with 
current Patent Automated Information Systems (AIS's) will allow for a 
fully automated, text-driven patent application processing system.
            Strategy #5: Telework
    In fiscal year 2006, a pioneer group of 500 patents examiners 
participated in the newly implemented Patent Hoteling Program (PHP). 
This voluntary program is designed to comply with congressional 
direction and build upon the lessons learned from the very successful 
Trademark Work-at-Home program. The PHP provides patent examiners the 
ability to work from home with complete on-line access to the USPTO 
resources. This concept allows participants to reserve time in 
designated shared ``hotel'' offices at the Carlyle Campus in 
Alexandria, Virginia. We plan to add 500 more examiners to the hoteling 
program in fiscal year 2007. The goal of the hoteling program is to 
change the boundaries of the old workplace patterns allowing for 
decreased commute time, greater control over workloads, and even a more 
balanced lifestyle for our employees. This all translates into 
increased employee productivity and satisfaction, as well as higher 
employee retention. On a more long-term basis, we hope to create a 
workplace that can be anywhere, any time. Patents will also pilot a 
work-at-home program for technical support staff.
    In 2006, Trademark's Work-at-Home program for examining attorneys 
received the ``Telework Program with Maximum Impact on Government 
Award'' from the Telework Exchange. The Trademark Work-at-Home program 
is considered a ``best practice'' because of its success in addressing 
budgetary, space, retention, recruitment, and job satisfaction issues. 
During 2006, trademarks expanded this program to include 85 percent of 
all eligible employees.
            Strategy #6: International
    With substantial congressional support, the USPTO has significantly 
expanded its efforts to strengthen intellectual property (IP) rights 
protection globally. As part of the Bush Administration's Strategy 
Targeting Organized Piracy (STOP!) initiative and the National 
Intellectual Property Law Enforcement Coordination Council (NIPLECC), 
the USPTO worked with other U.S. Government agencies to fight piracy 
and counterfeiting around the world. We collaborate on IP training, 
advocating progress in IP-related norm-setting bodies (e.g., 
intergovernmental organizations such as World Intellectual Property 
Organization (WIPO)), and enforcement efforts with our colleagues in 
the Departments of Commerce, Justice, and State; the Department of 
Homeland Security's Customs and Border Protection; the Copyright 
Office; and the Office of the United States Trade Representative 
(USTR).
    As part of STOP! the USPTO continues a communications campaign to 
educate small businesses about protecting their IP in the United States 
and abroad. Small business conferences are offered throughout the 
country and other USPTO conferences focus exclusively on the IP 
challenges of doing business in China. The USPTO continues to staff the 
STOP! Hotline, which lets callers receive information on IP rights and 
enforcement from our attorneys with regional and subject matter 
experts. In 2006, the hotline received 1,460 phone calls from people 
across America with a range of IP questions--an increase of 52 percent 
over 2005.
    To strengthen global IP protection, the USPTO represented the 
United States in discussions and negotiations at the WIPO throughout 
2006. Most notably, the USPTO led a delegation to the WIPO Diplomatic 
Conference, which culminated in the adoption of the Singapore Treaty on 
the Law of Trademarks. The new treaty will help trademark owners around 
the world file applications and renew registrations with fewer 
formality requirements.
    The USPTO has promoted IP protection in China. Through the Joint 
Commission on Commerce and Trade and its Intellectual Property Rights 
Working Group, the USPTO and USTR have negotiated commitments from the 
Chinese Government to reduce counterfeiting and piracy.
    The USPTO has established the Global Intellectual Property Academy 
and has conducted IP rights programs for foreign government officials 
and private sector representatives around the world. Additionally, we 
have placed IP experts in Brazil, China, Egypt, India, Thailand, and 
Geneva to advocate improved IP protection for American businesses and 
to coordinate training to help stop piracy and counterfeiting abroad.
            Strategy #7: Business Continuity/Disaster Recovery
    The USPTO Business Continuity Program/Disaster Recovery Program is 
committed to ensuring protection of USPTO data and systems from damage 
or unavailability in the event of a disaster or prolonged outage. The 
USPTO is operating both the patent and trademark production pipelines 
in a predominantly electronic environment and is dependent on automated 
systems to support the end-to-end processing of patent and trademark 
applications. As such, the continuing operations of the USPTO are at an 
increased risk should catastrophe strike the single data center prior 
to the full deployment of disaster recovery services. We are 
undertaking a phased implementation for deploying dual, load balanced 
data centers that would enable us to protect our mission critical 
patent and trademark data.
    The USPTO's Business Continuity Program completion timeline will 
occur in five major phases. As part of phase one, in 2007 the USPTO 
will establish an off-site data ``bunker,'' far enough away from our 
current data center to prevent a disaster from affecting both sites. 
Phase two will begin with the establishment of a ``warm site'' that can 
be activated in the event of a disaster at the primary data center. 
Future phases will provide distributed processing, load balancing, and 
automatic fail over for both core and non-core systems.
Conclusion
    Intellectual property rights is a critical aspect of how nations 
protect and promote innovation and global competitiveness. The United 
States represents the gold standard for intellectual property 
protection, and the USPTO is the most productive and most respected 
intellectual property office in the world. However, because 
intellectual property protection is so fundamental to our Nation's 
economic growth, being the best is not enough. We must be perfect. 
Despite the challenges, we at the USPTO strive to get it perfect, and 
we look forward to working with the subcommittee to ensure that we do.
    Thank you.

           PTO deg.PATENT APPLICATIONS AND PENDENCY

    Senator Mikulski. I have visited NIST, and I've been 
inspired. I've seen the hydrocarbon car and rode around in it 
and looked at how you've examined building properties after 
what happened at the World Trade Center, so not only do we 
prevent an attack on us again, but that our buildings will be 
safer and more secure.
    Let me now go to patents, and then I'll come back to you, 
Dr. Jeffrey.
    The protection of our intellectual property is an obsession 
with me. Because if we invent it, and all that goes into it, 
that's how we're going to compete in the world. My question to 
you, Mr. Dudas--and thank you for your energetic testimony--how 
many patents do you receive a year, and what is the nature of 
the backlog? I understand it's called ``pendency.''
    Mr. Dudas. Pendency is the amount of time it takes for an 
application from the time it's filed until the time it's 
completed, and the backlog is literally the number of 
applications that are waiting in line.
    Senator Mikulski. Okay, well, tell me how many do you get?
    Mr. Dudas. Yes, we are now receiving----
    Senator Mikulski. What is the backlog, and what is the 
pendency?
    Mr. Dudas. Yes, the number of applications we receive is 
growing every year, this year we anticipate 440,000 new patent 
applications--largest in the world--which is a good news in 
terms of innovation. 440,000 applications, and we're 
experiencing growth right now of about 8 percent--many 
countries are wanting to file more, and certainly Americans are 
filing more.
    Senator Mikulski. So, we have to be clear that it is not 
only inventors and entrepreneurs of the United States of 
America that file with you. But they file with you from around 
the world.
    Mr. Dudas. Absolutely.
    Senator Mikulski. And, I understand one of the largest 
countries is South Korea.
    Mr. Dudas. South Korea is one of the fastest growing 
countries. It is not right now one of the largest, but it is 
the fastest growing.
    Senator Mikulski. But you have 400,000 applicants a year, 
of pretty techno stuff.
    Mr. Dudas. Absolutely.
    Senator Mikulski. Okay, and what is the backlog?
    Mr. Dudas. The backlog is 700,000 patent applications 
waiting in line.
    Senator Mikulski. And how long is the timeframe?
    Mr. Dudas. The average across the board is 31 months--and 
it is growing because that backlog is, you know, I just call it 
``deficit examining''--more applications coming in, even with 
record hiring. So 700,000 applications, it's 31.1 months right 
now, on average--but that's a little misleading, let me tell 
you, to say ``on average'' because we have some areas--in the 
mechanical arts, for instance--maybe relatively simple 
inventions that are only taking 14 months. That's wonderful, 
but on the other hand, we have some areas--like the electrical 
arts--where you see a lot of the high technology, unfortunately 
where you see the short life cycle, that could take 5 or 6 
years. And this is exactly why we are introducing concepts like 
accelerated examination.
    Senator Mikulski. Well, then, let me go to these questions. 
You've read the Government Accountability Office (GAO) report, 
you're obviously there, and we're glad about the recognition in 
Business Week. But my concerns relate to ongoing communication.
    Mr. Dudas. Right.
    Senator Mikulski. And the issues related to improving 
technical education of staff. You're hiring people that are hot 
tickets in the marketplace.
    Mr. Dudas. Right.
    Senator Mikulski. These are intellectual property lawyers, 
paralegals, support staff--they're hot.
    Mr. Dudas. Right, very.
    Senator Mikulski. And, in some instances, they also have to 
have security clearances.
    Mr. Dudas. Right, absolutely.
    Senator Mikulski. And we understand the dynamic in that.
    Mr. Dudas. Right, they all have to be American citizens, as 
well.
    Senator Mikulski. So, could you--one of the things I noted 
in your prepared remarks that you submitted, that you want to 
retain, you don't want to keep training the new.
    Mr. Dudas. Right.

  PTO deg.PATENT AND TRADEMARK OFFICE RETENTION AND TRAINING

    Senator Mikulski. And we support that. Could you tell us 
what you're doing in the area, both of retention, and providing 
and cracking this whole issue of ongoing technical training. 
There are people, when I talk to Nobel Prize winners that have 
worked, who were civil servants, both at NASA and NIST, they 
said they liked working for the Federal Government because it 
was mission, it wasn't money, it was purpose. And, they also 
worked with the best colleagues in the world, and they had the 
opportunity for their own intellectual expansion. For us, for 
them to stay fresh, both technically, and fresh in terms of 
enthusiasm for the job, and a desire to stay.
    Could you talk, then, about your retention techniques, and 
the opportunity for them to get ongoing education.
    Mr. Dudas. Absolutely.
    Senator Mikulski. And do you need something from us?
    Mr. Dudas. I'll report what you have, and quite honestly, 
we're looking for guidance from anywhere and everywhere we can 
get it, but I will tell you that I think we've done a number of 
things.
    First and foremost, what you talked about--what do people 
want today? They're called the ``millennial,'' I'm not a 
millennial, the millennial generation, but many of the people 
we hire today, they care about Government service, they want to 
be valued--money matters, but that's not the number one thing 
that attracts them, and we try to address that, as well.
    And you talked about training, and making sure you show 
value. Of course, we have a challenge, because we are a 
performance-based organization, people do have to work hard in 
our office, but there's a number of things that we've done.
    First and foremost, we've changed the way we train. Instead 
of having examiners come in and train for 2 to 3 weeks and then 
have a mentor approach, we've actually started a Patent 
Examiner Training Academy, where they come in for 8 months, we 
give extended-term training, so we can get a greater level of 
consistency, it allows for more teamwork, it allows for people 
to get to know the office better, and more consistency. That is 
something that we needed to do, both because we thought it was 
a best practice, and because of the amount we were hiring. It 
turns out it has been a good practice.
    Senator Mikulski. That's when they come in. What about 
training for them while they're there? In other words, say 
they've worked for 3 years, and they want to get refreshed and 
renewed----
    Mr. Dudas. Yes, absolutely.
    Senator Mikulski. Both intellectually, and professionally.
    Mr. Dudas. Absolutely.
    Senator Mikulski They need to know the new stuff and the 
new bus.
    Mr. Dudas. Absolutely. One of the things we've done, is 
beef up on allowing examiners to take time and use money to get 
external training. And we're doing more internal training as 
well. So, for instance, an examiner can have an opportunity to 
have their legal degree paid for. If they want to get education 
outside, they can get a legal degree outside the office and the 
office will pay for it. In addition to that, any training they 
want to get that's related to their field, outside the office, 
PTO will pay up to $10,000.
    Last year we had the first-ever managers training 
conference, where we worked with managers, we got all of the 
managers out, 2 days away from the office, to talk to them 
about how they can train better, how they can resolve conflicts 
better, how they can listen and communicate better with 
examiners. Now we're also developing the different kinds of 
training programs we can offer. We already offer several 
through the office, and through the Federal Government. But, 
how do we tailor it specifically for those examiners who've 
been there for a long time?
    Another program that we think is very important for 
retention is teleworking. Five hundred examiners were given the 
opportunity to work from home last year, and 500 more patent 
examiners this year. Giving the examiners the opportunity to 
have the flexibility to determine what they think is the best 
work environment for themselves. We've found that that has been 
an incredible boost for morale. Teleworking also gives people 
more time with their families, but also more time to increase 
their production, if they want to do that.
    Senator Mikulski. Well, my time has expired, I will turn to 
Senator Shelby. But, Dr. Jeffrey, you won't leave without a 
question from me.
    I think that's exciting--no, go ahead, go ahead. Senator 
Shelby, you go right ahead.
    Senator Shelby. Thank you.

         NIST deg.AMERICAN COMPETITIVENESS INITIATIVE

    Dr. Jeffrey, I'll start with you, if I could.
    The National Institute of Standards and Technology. Last 
year, we've been talking about, the President announced the 
American competitiveness initiative--investments are made in 
federally funded research to ensure that the country has a 
technologically skilled workforce. The National Institute of 
Standards and Technology is one agency designated to lead this 
initiative.
    Dr. Jeffrey, how has the American competitiveness 
initiative improved your portfolio in NIST?
    Dr. Jeffrey. Thank you very much, Senator.
    The ACI was an absolutely tremendous boost to NIST's 
ability to do its mission. NIST stimulates innovation and 
competitiveness through measurements and standards, 
specifically to help support U.S. industry in terms of their 
competitiveness, and also improving the quality of life.
    The ACI finding will help us in a number of areas. For 
example, it helps us to accelerate the development and adoption 
of absolutely groundbreaking, and economically significant 
technologies. Like, for example, nano-technology, which is 
estimated to, perhaps, be a $1 trillion industry in 10 years. 
Also, in support of our energy independence through advancing 
the hydrogen economy and biofuels work.
    It also supports the technical infrastructure that industry 
needs for the measurements like the work at the NIST Center for 
Neutron Research (NCNR), and the new NIST Center for Nano-Scale 
Science Technology. Bottom line is the ACI substantially 
enhances NIST's capacity and capability to meet our mission.

        NIST deg.DISASTER RESILIENT STRUCTURES STUDIES

    Senator Shelby. I'm also pleased to see that the budget 
request includes an increase of funding for improving disaster-
resilient structures in communities. Results from these studies 
are expected to influence building codes and construction 
practices along the gulf coast, which need updating to match 
current risk assessments.
    How are you planning to coordinate with gulf coast 
communities and State agencies to implement any results from 
this program? As you know, continued construction--costs 
continue to rise in the gulf coast as a result of rebuilding 
from the 2005 hurricane. What part of this program explores how 
safer construction could actually become more cost-effective 
than current practices? Looking at the whole picture.
    Dr. Jeffrey. Thank you, Senator.
    We're very excited by the programs and new initiatives that 
we put in in the 2008 budget. To answer the first question 
``how we're going to coordinate''. After Hurricanes Katrina and 
Rita, NIST did an assessment--Lessons Learned in the Gulf Coast 
Region. At that point we worked very closely with a lot of 
State and local officials who were responsible for enacting and 
enforcing the building codes. We have a good working 
relationship with them, as well as the construction industry 
down there.
    Just like that, we will continue to work with the State and 
local officials and with the local industry building officials 
as the results from these new initiatives come forward. We'll 
also continue to work with the National Building Codes and 
Standards, to make sure that the lessons get adopted in there.
    To answer the second question, which is how do we ensure 
the cost effectiveness, the whole crux of that program, the 
whole goal is to find a way of balancing the risk and the cost. 
So the overall programs focus on exactly that goal. There are 
actually three ways that we're going to be doing that. One is 
in the focus on the building codes and standards on the local 
risk assessment. It matters--whether you're a block away from 
the ocean, versus 1 mile away from the ocean, and that needs to 
be included when one looks at the risk assessment, and what the 
building codes should be.
    Second, we're emphasizing performance of the building 
codes, as opposed to individual components, that way, it's very 
prescriptive right now. What you want to do is look at the 
performance in the entire structure.
    And last, to really foster the adoption of new construction 
techniques and materials that are at lower costs, that can help 
provide greater security and risk assessment.

              PTO deg.INTELLECTUAL PROPERTY THEFT

    Senator Shelby. Secretary Dudas, what are you doing at the 
U.S. Patent and Trademark Office to curb intellectual property 
theft, and strengthen both domestic and international 
protection of these rights?
    Mr. Dudas. Thanks for asking that question.
    We are working both internationally and domestically. 
First, while training small businesses in the United States, we 
came to the conclusion we can't just issue patents and 
registered trademarks, we need to educate businesses. So, we 
have seminars throughout the country training small businesses.
    First, on intellectual property generally, second on how to 
do business in China, particularly, because it's such a hot 
area and there's such a problem there.

         PTO deg.INTELLECTUAL PROPERTY LAW ENFORCEMENT

    Senator Shelby. What about enforcement?
    Mr. Dudas. Enforcement, we are not police.
    Senator Shelby. We know that. But you aid in the----
    Mr. Dudas [continuing]. Absolutely. We're the advisors to 
the rest of the administration on free trade agreements, we 
work very closely with the Departments of Justice and Customs 
and Homeland Security, and we are often on the front lines. We 
place people in China, Brazil, India, Russia, who work with 
custom officials and others. And we also have a Global 
Intellectual Property Training Academy where we train hundreds 
of officials from foreign governments. We bring them here, 
they're Supreme Court justices, customs officials, and train 
them here in the United States.
    Senator Shelby. Absolutely. How large of a role does lax 
enforcement--lax enforcement--of patents and copyrights 
agreements, internationally play in violating intellectual 
property rights? In other words, if you don't enforce what you 
have.
    Mr. Dudas. Right.
    Senator Shelby. Or if you don't try to enforce it, if 
you're not diligent, you're not on top of things--what do you 
have, right?
    Mr. Dudas. Right. Lax enforcement, I think, is the number 
one problem for intellectual property rights. Many nations have 
put laws into place that might comply, but if you don't enforce 
them, you have nothing. Sometimes shaking a stick at other 
nations, and telling them why it's critical, and we do that 
through a variety of ways--but also, educating their officials 
in why it's in their interest, as well as the United States.

          PTO deg.COST OF INTELLECTUAL PROPERTY THEFT

    Senator Shelby. Well, what's the estimated cost impact in 
the United States, to the U.S. economy in terms of money and 
jobs that can be attributed to the theft of U.S. intellectual 
property?
    Mr. Dudas. We've seen estimates as high as $250 billion.
    Senator Shelby. Say that again, for the record, two 
hundred----
    Mr. Dudas. $250 billion.
    Senator Shelby. $250 billion of lost money, it's jobs, is 
it not?
    Mr. Dudas. And the estimates of up to 750,000 jobs just 
from intellectual property theft.
    Senator Shelby. Do you have the coordination of the other 
agencies to enforce our copyrights?
    Mr. Dudas. I think we do, and----
    Senator Shelby. Is it working pretty well?
    Mr. Dudas. At the Presidential level, they pull together 
nine different departments and agencies, targeting organized 
piracy. We now see the President raising, as he has been for 
some years, the issue with world leaders, and we've seen real 
results because of that. The Department of Justice had a 
copyright takedown in 10 different countries because of 
international cooperation.

              PTO deg.PATENT EXAMINATION QUALITY

    Senator Shelby. The quality of patent examination is 
central to ensuring that we have strong, enforceable patents, 
otherwise they challenge, and say there's absolutely nothing to 
that, you know, that's in the marketplace, everybody knows it. 
What are you doing to ensure the quality of the patent 
examination? You talked about the applications with Senator 
Mikulski, and the backlog, but you know, you don't want to run 
in and do something too hastily.
    Mr. Dudas. Right.
    Senator Shelby. Because, otherwise you--the quality's not 
there.
    Mr. Dudas. You're 100 percent right that there is tension 
between productivity and quality, and we have to be fair to the 
examiners. I will tell you, our number one goal was to make 
certain we improved certainty and quality in the system.
    The first thing we do is hire the best and the brightest, 
the most dedicated people.
    Senator Shelby. How do you do that, and compete in the 
marketplace, this is very important for a governmental agency 
that we fund to do that?
    Mr. Dudas. Hiring 1,200 examiners has been an incredible 
challenge, to hire the best and the brightest. We've judged by 
grade point averages, and where people are coming from. Quite 
honestly, I think the reason we've been successful in this 
model, is because we do offer what Senator Mikulski mentioned, 
which is Government service. You take a constitutional oath to 
come to our office.
    Senator Shelby. They're not doing it for money.
    Mr. Dudas. They're not doing it for money.
    Senator Shelby. But also, intellectual challenges in there.
    Mr. Dudas. The intellectual challenges in our office are 
absolutely one huge challenge for us. They do become valuable, 
because they are so intelligent coming in, and the skills they 
learn at the Patent and Trademark Office make them valuable in 
other ways. But, we actually have a team that measures, 
separate team that measures randomly, quality of examiners, 
randomly 6 to 18 different cases. We've beefed up that, in 
terms of how many cases we look at.
    Senator Shelby. You have production goals, but at the same 
time, it can't just be numbers, it's got to be quality.
    Mr. Dudas. Right, we have production goals and quality 
goals, and there are no bonuses--you cannot get a bonus until 
you've met your quality goal. At least met your goal for 
quality.
    Senator Shelby. The worst thing you could do is allow a 
patent for something that, isn't, perhaps not patentable, just 
to meet a goal or a deadline, is that correct?
    Mr. Dudas. You're absolutely right that quality has to be 
first and foremost. And that's why, probably, the thing we are 
proudest of is that we drove our error rate down to the lowest 
it's been in history in trademarks, and second lowest in 
history of patents.
    Senator Shelby. The chairman has indulged me, if I have one 
more question, Madam Chairman?

           PTO deg.HUMAN CAPITAL MANAGEMENT REVIEWS

    Mr. Dudas, over the past 7 years, independent audit in 
agencies such as Government Accountability Office, OPM and the 
inspector general have reviewed your office management of human 
capital. What has been the result of these numerous audits, and 
do you believe that your agency is aggressively implemented the 
recommendation of these reviews, can you--and can you provide 
specific improvements that has shown in the area of human 
capital management?
    Mr. Dudas. Absolutely.
    Senator Shelby. So much of what you're doing is dealing 
with people, but people with high intellectual capacity.
    Mr. Dudas. Right. First, to answer your question directly, 
I am certain that we're aggressively implementing the 
recommendations in these studies, and I will give you 
specifics, but I want to point out--I think you're 100 percent 
right--we have some of the smartest people there are, and 
they're at the cutting edge of technology. I'm always humbled 
when I sit down and talk to a Ph.D. in biotechnology in our 
office to try to learn something specifically about a case.
    And, I will tell you, first and foremost, when we look at 
the Federal human capital survey, what our employees----
    Senator Shelby. You got a lot of Phi Beta Kappas over 
there?
    Mr. Dudas. We've got a lot of Phi Beta Kappas, yes.
    And when we look to our employees themselves, and look at 
the results we have--and quite honestly, anecdotally, from me 
walking around in the gym, and the preschool, and walking 
around, just talking to examiners--what we do incredibly well 
is measure. We give people the expectations they need and they 
believe they're promoted for the right reasons.
    What we're not doing well enough, and what we're focused on 
now, is letting people feel they have creativity and innovation 
in what they're doing. Because this production environment and 
the metrics environment is a challenge to that.
    And, so we've done a number of things. We've established an 
Office of Internal Communications, focused only on how we 
communicate with others. I've called in our management team, we 
actually changed some of our management team, because we wanted 
to make certain that we're communicating better, and we wanted 
to make certain our senior managers did communicate better. So 
our Commissioners of Patents and Trademarks have brown bag 
lunches at least every month. Sometimes it's little things, 
like going to retirement parties, speaking to examiners, 500 or 
600 at a time. The Patent Training Academy brings in classes of 
about 120 examiners at a time. Either I, or the Deputy and the 
Commissioner will meet with them two or three times, to make 
certain we're letting them know what's going on. And certainly, 
most importantly, open to the different questions.
    But on the more administrative side, we have a human 
capital plan that we put in place and the Human Capital Council 
that we've put in place. The question is, what are the results? 
So, certainly, long term, I think administratively we've made a 
big difference. I will tell you some of the results, I think, 
we've gotten this year.
    Being able to hire 1,200 examiners, and have a high-quality 
class is something that, quite honestly, we were intimidated 
by, because a number of Senators, a number of Members said, 
``You simply can't do it.'' Our original goal was 750, and then 
we did 875, and then we raised the goal to 1,000, and we did 
1,219. And now we feel comfortable and confident that we can do 
this with 1,200 folks. So, I think, just having an operation 
that can hire 25 percent of your workforce every year is a 
testament to what our human capital plan has put in place so 
far.
    Although money is not the most important thing, we 
recognize we need to be competitive. We were able to get both 
retention and recruitment bonuses adopted through the Office of 
Personnel Management, as well as an across-the-board pay raise 
of 7 percent for all patent examiners, both in the same year, 
to say, ``Listen, we have to be able to recruit on this 
basis.''

    PTO deg.RELATIONSHIP WITH FOOD AND DRUG ADMINISTRATION

    Senator Shelby. What kind of relationship do you have with 
the Federal Drug Administration?
    Mr. Dudas. Food and Drug Administration?
    Senator Shelby. Food and Drug----
    Mr. Dudas. It's more administrative than anything else. Our 
policy folks get together and talk, but certainly we have an 
administrative relationship in that certain pharmaceutical and 
agricultural products----
    Senator Shelby. Right.
    Mr. Dudas. Have an administrative way of getting a term 
extension. It's mostly a ministerial task at the Patent and 
Trademark Office.
    Senator Shelby. Because they patent.
    Mr. Dudas. What happens is that the Food and Drug 
Administration or Agriculture has to approve a certain product, 
so they're not allowed to get to the market----
    Senator Shelby. Absolutely, it's safety.
    Mr. Dudas. Yeah, exactly, the Hatch-Waxman law allows for 
some extensions. So, we have a relationship in that we 
communicate with them, so we understand----
    Senator Shelby. Sure.
    Mr. Dudas. But, really it's more administrative.
    Senator Shelby. Okay.
    Thank you for your indulgence, Madam Chairman.
    Senator Mikulski. Well, Senator Shelby, those were 
excellent questions, and certainly reflect my own thinking.
    I just wanted to close the loop for the purposes of this 
hearing on the patent issue. I think what we're saying is, that 
what we want is the PTO to really function in the way I think 
you and we would like it to be. There have been a series of 
issues that have been raised, and there are numerous reports, 
and that you have raised internally. We know that there's been 
legislation that took the PTO from kind of a 1950's Government 
thinking--when Rubric's quoting in 50's and 60's technology--to 
a performance-based agency in a new world order. Not only a new 
economy. And, therefore, we're very conscious in performance-
base with benchmarks, and metrics, these things are important.
    All of this is important, but ultimately, it's those 
employees who feel that they are on solid ground, and they want 
to either make it a career, or they want to make it a long 
enough of a career to make what we invest in them worthwhile. 
That's really our question. Because we know, in the 
marketplace, they'll move out. But you will always need a cadre 
of civil servants that are there. So, this is why we'll come 
back to you in terms of what I raise with both Secretary Dudas 
and Gutierrez, you've heard what we've raised, no surprises, 
and no spring hazing--we wanted that remediation plan. So, 
let's get this remediation plan. You know what the challenges 
are, and what we think we can do this year, and what we can do 
subsequently.
    We're also aware of the international challenges--not only 
the number of countries that are applying and--because they 
want our intellectual property so they can come into our 
market. We're the gold standard. You are, like FDA, the gold 
standard.
    And, what we're very impressed by the National Intellectual 
Property Law Enforcement Coordinating Council. I've read their 
most recent report, and Senator Shelby, I know you've traveled 
the world on security matters, both as intel chair, and 
actually of this subcommittee, which--you get high marks for 
training Government officials in other countries to enforcement 
issues, educating foreign publics about intellectual property, 
the group called STOP.
    So, that's a whole other area we could follow up on. But, 
we want to be sure, as we go ahead in this year's 
appropriation, you can meet some of those international 
challenges, as well as being flooded with patents. So, we're 
going to come back to you.

   NIST deg.NATIONAL INSTITUTE OF STANDARDS AND TECHNOLOGY 
        FUNDING INCREASE FOR AMERICAN COMPETITIVENESS INITIATIVE

    But, Dr. Jeffrey, let me go over to you, I mean, we're very 
impressed that the President's budget increased funding for 
NIST, particularly in the laboratory and some construction 
accounts, however we're concerned that it was paid for out of 
ATP and the manufacturing extension program.
    But, if we could come back to you being in the 
competitiveness agenda--what do you think are the three kinds 
of most robust things that you want to do with this new money, 
and is this--does it go to the horizon, or does it take us over 
the horizon? And also, looking at both innovation and then, to 
the extent that you can testify publicly, its link to security?
    Dr. Jeffrey. Absolutely. The three overriding things that 
we need to do at NIST to ensure that we're providing the 
support in industry and academia that we need to do, is one, we 
need to absolutely ensure that our basic core competencies are 
strong, and that we're meeting the needs of industry today, and 
as we look forward to the future. And there's a number of areas 
that some of the funding under ACI is going in to strengthen.
    It's no secret that the NIST funding has--over the last, 
essentially, two decades, not really kept pace with the needs 
that were arising. And so we've eaten into our seed corn. This, 
now, fixes that.
    Second, we need to look at was the future to those areas 
that are going to be absolutely critical for industry and 
universities. Nano-technology is a great example. That's going 
to be an incredible disruptive and important economic impact. 
It's estimated that up to 15 percent of all manufactured goods 
in 10 years is going to include nano-technology. We need to be 
there and ready for them.
    And the third area is that we have to ensure that we have 
the facilities capabilities to make these kind of measurements. 
And that also, if I could almost follow on to the last of the 
questioning, is critical to being able to attract and retain 
the best and the brightest scientists. They have to be able to 
have the kinds of facilities necessary to do the job, and 
that's why you also see an important component on the 
facilities, and in our budget.

       NIST deg.CENTER FOR NANO-SCALE SCIENCE TECHNOLOGY

    Senator Mikulski. Well, we appreciate that, and if I could 
go right to nano-technology in a question.
    As I understand it, this is $6 million for enabling nano-
tech from discovery to manufacturer. At this center, do you, 
have you developed an operating business plan for moving ahead 
with this, because there's some question about the user 
facility.
    Dr. Jeffrey. Absolutely, the Center for Nano-Scale Science 
Technology is sort of a two-pronged program. One is, as a 
national user facility, and the other is as a research 
facility. That was created in the 2007 President's budget and 
is now being expanded in 2008. We are in the process of 
completing all of policy documents and all of the business 
models for that. I was, quite frankly, slowed down a bit 
because of the continuing resolution, until that was resolved, 
and thanks to a lot of the support of the people here and on 
the House side, we've had sufficient funding in the continuing 
resolution to now move forward.
    So, we expect to have all of the documents done, and open 
for business, essentially, May of this year.

              NIST deg.SAFETY OF NANO-TECHNOLOGY

    Senator Mikulski. Well, that sounds good. One last question 
about nano-tech.
    One of the issues that is raised is, that--is nano-tech 
safe? Because they're such mini-, micro-particles, I don't even 
have--they're nano-particles, which means they're sub-mini-
micro-particles. But there's a lot of question, as you know, 
about the safety of them. Is part of your ongoing research and 
standards is, the flashing yellow lights around the impact of 
health, the part of the NIST effort?
    Dr. Jeffrey. Excellent question, Senator.
    NIST is taking very seriously the issues of safety in nano-
technology. And we're working with other agencies to make sure 
that we have good answers for the general public, because the 
worst thing that can happen is, either an actual 
environmental----
    Senator Mikulski. But are you doing it?
    Dr. Jeffrey. The role that NIST plays is on the 
measurements and characterization of the nano-technology that 
gets, that one can then determine the health impacts.
    I'll give you an example, a concrete example. Carbon nano-
tubes, which are one of the essential building blocks of nano-
technology--we received a sample of carbon nano-tubes from 
industry to characterize it. We found that 60 percent--six-zero 
percent--of the atoms were not carbon, they were heavy metals.
    Senator Mikulski. Oh, gosh.
    Dr. Jeffrey. There were catalysts that were used, thereby 
contaminating the sample. So, when one, then goes to NIH or 
others to look at the toxicity, are you measuring the toxicity 
of the carbon nano-tube? Or the toxicity of the heavy metals?
    So, NIST is working very closely to characterize materials, 
to purify the materials, to ensure that we've got the 
measurements that we can then apply, working closely, and we 
are working closely and collaboratively with NIH, with FDA and 
with others, to have that collusive approach. We provide the 
measurements characterizations, they supply the medical 
implications.
    Senator Mikulski. That's fantastic.
    We also are very heartened by the fact that you are one of 
the lead agencies in dealing with the climate crisis, when 
measurements and standards for climate change science, as well 
as the practical things like the national earthquake hazard 
reduction program.

 NIST deg.EFFECTIVENESS OF MANUFACTURING EXTENSION PARTNERSHIP

    We won't go into that now, but here's the question--you 
hear our colleagues here raising questions about manufacturing 
extension. And then you've also heard on the floor, challenges 
to ATP, is it corporate welfare, whose time has come and gone. 
What are your comments about ATP and MEP? We're going to be on 
pressure from one group of Senators who want to save ATP and 
another group of Senators who want to tank it. And then, of 
course, there's enthusiastic support for MEP. And, I think, 
well-warranted--the support is not, again, it's not about pork, 
but in their community it's been, it's brought the beef.
    Dr. Jeffrey. Thank you. Let me take the last part first, on 
MEP, as the Secretary testified to, the administration 
recognizes the effectiveness of MEP, it is an effective 
program, it's been measured and rated by OMB as an effective 
program. The issue is one of prioritizations in the tight 
budget climate. Our core competencies and concentration is on 
the measurements and standards that impact entire industries, 
and opposed to individual companies one at a time. And, in a 
tough budget climate, those prioritizations had to be made.
    On ATP, there is a lot of disagreement as to where the 
appropriate role is for the Federal Government to be investing. 
One thing, I think, is fairly clear, though, is that there is 
friction between the basic scientific discoveries, and when it 
ends up in the marketplace.
    And, there are a number of different ways that one can look 
at trying to minimize that friction, and make it easier to 
increase the efficiency by which a scientific discovery is able 
to get commercialized. And I think we need to be open in 
looking at all sorts of different models and policy options to 
try to help and make that the most efficient. Because, the 
faster we can get those discoveries to market, the better the 
advantage we will have in the global economy.
    Senator Mikulski. Well, that's exactly right, and you're 
working to develop those standards and so on, and that's the 
heart and soul of a patent process--not only what is it and 
what does it do, but how do you kind of measure it, or certain 
metrics, not only measurement, to identify it, et cetera.
    Well, our time is really up.
    Senator Shelby. I just wanted to----
    Senator Mikulski. Yes, we could go on all day, and I hope 
one day to visit you, and of course, visit you, Dr. Jeffrey, 
and perhaps we could go together, but Senator Shelby?
    Senator Shelby. I would like to go sometime, and I don't 
know if I'd understand everything they were doing, but I'd be 
fascinated.
    Senator Mikulski. Me too.

  NIST deg.NATIONAL INSTITUTE OF STANDARDS AND TECHNOLOGY'S 
                      COLLABORATION WITH INDUSTRY

    Senator Shelby. Dr. Jeffrey, in your testimony, you 
mentioned the recent advancements, I'm picking up on Senator--
in nano-technology, and how your agency is developing a method 
for testing the quality of nano-tube material.
    Besides testing the tubes, what other ways does NIST plan 
to interact with the industry? Particularly, with the 
manufacturing of more efficient fuel cells, and creating 
baseline standards for the use of nano-particles within the 
medical industry.
    Dr. Jeffrey. Thank you very much. There's a number of 
different areas where we've been reaching out to industry. One 
of the beauties of NIST, which is almost unique among the 
Federal Science and Technology Enterprise, is the close 
collaboration that we have with industry. Where they are not 
just customers, they are partners.
    I believe Secretary Gutierrez made a reference that we have 
about 1,500 technical Government employees, but we have about 
2,800 technical private sector people from industry and 
academia, literally coming to the NIST campus and working side 
by side, so it's a very close collaboration.
    In terms of some of the specifics, I'll give this as an 
example. We actually just completed a study, it's called An 
Assessment of the U.S. Measurement System, where we actually 
looked at----
    Senator Shelby. What are the results of the study?
    Dr. Jeffrey. Well, the results are that we're trying to 
identify measurement barriers to innovation. This is to help us 
in our strategic planning process, as well as to reach out to 
other parts of the Federal Government, where they have 
measurement needs. We identified 723 measurement barriers to 
innovation that were in 11 different industry sectors--
including ones that you described. One of the things that we're 
now doing, now that we have--this is the first cut--it's 
fascinating reading, sir, we'll be glad to provide copies. But 
one of the things that we're now doing is, essentially, a deep 
dive into this, and looking at--as opposed to 723 separate 
measurement needs, are there systemic issues that we can attack 
that would be the highest priority that we can then, really 
make the biggest difference on.
    And, so we're working very closely with the universities 
and I'm very proud to say we hosted a set of universities from 
Alabama up on the NIST campus, specifically looking at some of 
the health impacts on the new technology, and looking broadly 
at reaching out and forming partnerships. I was very impressed 
with what I saw.
    Senator Shelby. This is very promising. It's a different 
field from anybody could imagine other than the lab 25 years 
ago, is that right?
    Dr. Jeffrey. Absolutely. This is an entirely new area. One 
of the things to put this into perspective, when we talk about 
nano-technology, and mini-micro and going all the way down. We 
have a beautiful picture that we captured of a carbon nano-
tube, again, it's sort of a basic building block--on the hair 
of the leg of an ant.
    Senator Shelby. It's so small, it's hard for us to imagine, 
isn't it?
    Dr. Jeffrey. Yeah, absolutely.
    Senator Shelby. We talked about miniaturization of 
everything, but then, this has gone a quantum leap, has it not?
    Dr. Jeffrey. Absolutely. We are literally talking about a 
few atoms. It's really where the action is occurring.
    Senator Shelby. Thank you, Madam Chairman.
    Senator Mikulski. Well, thank you. And, we want to thank 
our panelists, and I think this has been a very, a very robust 
hearing. And we've gotten the subcommittee off to a good start, 
we thank you for your service, and we look forward to working 
with you now, as we go through the appropriation process.

                     ADDITIONAL COMMITTEE QUESTIONS

    If there are no further questions, Senators may submit 
additional questions for the subcommittee's official record. We 
request the Department's responses in 30 days.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
           Questions Submitted by Senator Barbara A. Mikulski
                  departmental management wcf and a&r
    Question. Please provide the WCF bill breakout (including the A&R) 
by bureaus for fiscal year 2001-2007. Also provide the estimated WCF 
bill (including A&R) for each of the bureaus in the fiscal year 2008 
request.
    Answer. The requested information follows.

                                               ATTACHMENT 1.--ADVANCES & REIMBURSEMENTS SUMMARY BY BUREAU
                                                                [In thousands of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                       Fiscal year--
                                                                 ---------------------------------------------------------------------------------------
                             Bureau                                                                                                    2007       2008
                                                                     2001       2002       2003       2004       2005       2006     estimate   estimate
--------------------------------------------------------------------------------------------------------------------------------------------------------
OFFICE OF THE SECRETARY--SALARIES & EXPENSES....................      4,201      4,333      3,873      2,690      5,094      4,306      4,820      4,931
INTERNATIONAL TRADE ADMINISTRATION..............................     15,351     15,202     15,454     12,901     13,910     12,510     13,319     13,622
ECONOMIC DEVELOPMENT ADMINISTRATION.............................      1,376      1,411      1,370      1,230      1,298      1,372      1,613      1,647
NATIONAL TELECOMMUNICATIONS AND INFO ADMIN......................      2,608      2,650      2,579      2,027      2,431      2,387      2,582      2,641
NATIONAL TECHNICAL INFORMATION SERVICE..........................        282         32         76        211         85        129        143        145
BUREAU OF THE CENSUS............................................      1,703      2,261      1,367      1,540      1,503      3,210      4,873      4,956
ECONOMIC AND STATISTICAL ANALYSIS...............................      1,109      1,135      1,128        901      1,195        882      1,058      1,081
NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION.................      4,805      4,047      3,810      4,062      3,938      5,420      7,155      7,290
NATIONAL INSTITUTE OF STANDARDS AND TECHNOLOGY..................      1,042        825        778        988        910      1,002      1,451      1,476
MINORITY BUSINESS DEVELOPMENT AGENCY............................        786        797        849        602        709        703        777        795
BUREAU OF INDUSTRY AND SECURITY.................................      3,643      3,735      3,662      3,061      3,487      3,243      3,550      3,630
TECHNOLOGY ADMINISTRATION.......................................        929        937        932        775        660        423        277        283
OFFICE OF INSPECTOR GENERAL.....................................      1,350      1,373      1,126        999      1,163      1,130      1,142      1,169
OFFICE OF COMPUTER SERVICES.....................................        419        425        309        266        269        268        276        282
OFFICE OF THE SECRETARY--WORKING CAPITAL FUND...................      6,813      7,076      6,813      5,338      6,066      5,661      5,918      6,057
                                                                 ---------------------------------------------------------------------------------------
      SUBTOTAL BY BUREAU........................................     46,417     46,239     44,126     37,591     42,718     42,646     48,954     50,005
                                                                 =======================================================================================
PATENT AND TRADEMARK OFFICE.....................................      1,248      1,107        825      1,133      1,135      2,517      2,610      2,655
                                                                 =======================================================================================
      TOTAL A&R.................................................     47,665     47,346     44,951     38,724     43,853     45,163     51,564     52,660
--------------------------------------------------------------------------------------------------------------------------------------------------------
NOTE: Fiscal years 2001-2002 represents the operating plan for the year.


                                             ATTACHMENT 1A.--WORKING CAPITAL FUND BILLINGS SUMMARY BY BUREAU
                                                                [In thousands of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                       Fiscal year--
                                                                 ---------------------------------------------------------------------------------------
                             Bureau                                                                                                    2007
                                                                     2001       2002       2003       2004       2005       2006    operating     2008
                                                                   actuals    actuals    actuals    actuals    actuals    actuals      plan     estimate
--------------------------------------------------------------------------------------------------------------------------------------------------------
OFFICE OF THE SECRETARY.........................................      6,810      6,419      6,873      7,966      8,906      8,551     10,142     10,923
INTERNATIONAL TRADE ADMINISTRATION..............................     16,997     18,905     20,673     24,356     26,886     27,688     29,801     31,306
ECONOMIC DEVELOPMENT ADMINISTRATION.............................      1,193      1,409      1,419      2,029      1,983      2,519      2,161      2,582
NATIONAL TELECOMMUNICATIONS AND INFO ADMIN......................      2,385      2,456      2,629      3,188      3,294      3,346      3,643      4,153
NATIONAL TECHNICAL INFORMATION SERVICE..........................        407        554        556        516        515        461        487        563
BUREAU OF THE CENSUS............................................     22,073     20,609     21,712     21,345     23,249     23,263     22,601     25,531
ECONOMIC AND STATISTICAL ANALYSIS...............................      1,779      2,140      2,127      2,215      2,542      2,608      2,564      3,058
NATIONAL OCEANIC AND ATMOSPHERIC ADMIN..........................     29,680     31,270     32,712     36,164     39,546     33,306     36,206     35,165
NATIONAL INSTITUTE OF STANDARDS AND TECHNOLOGY..................      7,482      9,317      9,858      9,798     10,527      9,616      9,339     11,496
MINORITY BUSINESS DEVELOPMENT AGENCY............................      1,213      1,203      1,439      1,468      2,024      1,866      1,928      2,384
BUREAU OF INDUSTRY AND SECURITY.................................      4,578      4,827      5,628      6,725      6,797      7,223      7,604      8,717
TECHNOLOGY ADMINISTRATION.......................................        630        665        552        900        939        724        613      1,100
OFFICE OF INSPECTOR GENERAL.....................................        967      1,057      1,054      1,359      1,531      1,621      1,700      1,874
OFFICE OF COMPUTER SERVICES.....................................        261        355        266        326        274        231        245        331
                                                                 ---------------------------------------------------------------------------------------
      SUBTOTAL BY BUREAU........................................     96,455    101,186    107,498    118,355    129,013    123,023    129,034    139,183
                                                                 =======================================================================================
PATENT AND TRADEMARK OFFICE.....................................      6,052      3,559      3,015      2,964      2,808      3,507      2,929      2,555
OTHER AGENCIES \1\..............................................      8,593      8,762      9,666      1,067        997        714        517      1,086
                                                                 =======================================================================================
      TOTAL.....................................................    111,100    113,507    120,179    122,386    132,818    127,244    132,480    142,824
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ DOC Federal Credit Union, White House Visitor Center, National Aquarium, National Indian Gaming Comm. and FAA.

    Question. Please provide a breakout of ATBs (adjustments to base) 
by bureau for WCF payments, any E-Government initiatives and for the 
Commerce Business System.
    Answer. The requested information follows.

                               ATTACHMENT 2.--DEPARTMENTAL MANAGEMENT--WORKING CAPITAL FUND FISCAL YEAR 2008 BUDGET SUBMISSION--ATBS & PROGRAM INCREASES BY BUREAU
                                                                                    [In thousands of dollars]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                   WIGS PAY
                                                     CSRS        FERS         TSP        FICA        BAND      GSA RENT    PRINTING     HEALTH      GPL ADJ    PER DIEM    COMP DAY      POSTG
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
O/S.............................................          -4           7           2           7  ..........          32           1          23          72           1          53           2
ITA.............................................          -8          13           2          13  ..........          64           1          47         177          11         105           2
EDA.............................................          -1           1  ..........           1  ..........           6  ..........           4          14  ..........          10  ..........
NTIA............................................          -1           1  ..........           1  ..........           8  ..........           4          27  ..........          11  ..........
NTIS............................................  ..........  ..........  ..........  ..........  ..........  ..........  ..........           1           3  ..........           2  ..........
CENSUS..........................................          -7          11           2          10  ..........          38           1          38         136           4          87  ..........
ESA/BEA.........................................          -1           1  ..........           1  ..........           6  ..........           4          13  ..........          10  ..........
NOAA............................................         -10          16           3          15  ..........          63           2          56         183           8         131           1
NIST............................................          -3           5           1           5  ..........          16           1          18          40           2          43  ..........
PTO.............................................  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........
MBDA............................................          -1           1  ..........           1  ..........           4  ..........           3           9  ..........           8  ..........
BIS.............................................          -2           4           1           3  ..........          18  ..........          12          34           1          29  ..........
TA..............................................  ..........  ..........  ..........  ..........  ..........           2  ..........           1           6  ..........           3  ..........
OS--IG..........................................  ..........           1  ..........           1  ..........           4  ..........           2          14  ..........           4  ..........
OCS.............................................  ..........  ..........  ..........  ..........  ..........           1  ..........           1           3  ..........           3  ..........
OTHER...........................................  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........
LESS ABSORBED...................................         -38          61          11          58  ..........         262           6         214         731          27         499           5
                                                 -----------------------------------------------------------------------------------------------------------------------------------------------
      TOTAL.....................................         -38          61          11          58  ..........         262           6         214         731          27         499           5
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


     ATTACHMENT 2.--DEPARTMENTAL MANAGEMENT--WORKING CAPITAL FUND FISCAL YEAR 2008 BUDGET SUBMISSION--ATBS & PROGRAM INCREASES BY BUREAU--CONTINUED
                                                                [In thousands of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                   SUBTOTAL
                                   EMP COMP       CBS        STEAM       PEPCO      GENERAL    2008 PAY    2007 PAY    TOTAL WCF    PROGRAM    TOTAL TO
                                               DECREASE                ELECTRIC      ATBS        RAISE       RAISE        ATB      INCREASE     BUREAUS
--------------------------------------------------------------------------------------------------------------------------------------------------------
O/S.............................  ..........          -8          41          97         326         156          39         521  ..........         521
ITA.............................  ..........         -48         138         329         846         302          75       1,223  ..........       1,223
EDA.............................  ..........          -6          13          30          72          30           7         109  ..........         109
NTIA............................  ..........          -4          27          64         138          31           8         177  ..........         177
NTIS............................  ..........          -8  ..........  ..........          -2           5           1           4  ..........           4
CENSUS..........................  ..........        -160  ..........  ..........         160         250          62         472  ..........         472
ESA/BEA.........................  ..........         -10          10          23          57          30           7          94  ..........          94
NOAA............................  ..........        -278          23          54         267         379          94         740  ..........         740
NIST............................  ..........         -70           1           2          61         123          30         214  ..........         214
PTO.............................  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........
MBDA............................  ..........          -3           7          18          47          23           6          76  ..........          76
BIS.............................  ..........          -8          37          89         218          83          21         322  ..........         322
TA..............................  ..........          -1           7          17          35           7           2          44  ..........          44
OS--IG..........................  ..........          -4          13          33          68          13           3          84  ..........          84
OCS.............................  ..........  ..........  ..........  ..........           8           7           2          17  ..........          17
OTHER...........................  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........
LESS ABSORBED...................  ..........        -608         317         756       2,301       1,439         357       4,097  ..........       4,097
                                 -----------------------------------------------------------------------------------------------------------------------
      TOTAL.....................  ..........        -608         317         756       2,301       1,439         357       4,097  ..........       4,097
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Question. Please provide a complete cost breakout for the 
development of CAMS/CBS by fiscal year since inception. Cost should 
capture: all contract costs; all Commerce staff assigned to central 
coordinating offices; all detailed staff from bureaus to central 
office; all staff costs for staff that primarily worked on CAMS/CBS.
    Answer. Attachment 3 provides a complete cost breakout for the 
development of the Commerce Administrative Management System/Commerce 
Business System (CAMS/CBS) from fiscal year 1999 to 2003. Upon full 
bureau implementation at the end of fiscal year 2003, CAMS/CBS has been 
in operational maintenance and support status.

                                                                                  ATTACHMENT 3.--CAMS/CBS COSTS
                                                                                    [In thousands of dollars]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                             Fiscal Years--
                                       ---------------------------------------------------------------------------------------------------------------------------------------------------------
                                           1999       2000       2001       2002       2003       2004       2005       2006       2007       2008       2009       2010       2011       2012
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Fiscal Year Total.....................     27,275     33,465     41,952     46,195     36,469     35,221     34,729     35,967     38,125     38,638     39,313     39,986     40,655     40,100
Labor.................................     23,195     28,620     36,000     39,731     31,123     30,030     29,480     30,393     31,335     31,385     31,980     32,557     33,048     32,341
    Government........................      9,561     11,731     12,009     12,354     12,784     12,346     12,474     12,814     13,238     16,281     17,418     17,895     18,110     18,320
    Contractor........................     13,634     16,889     23,991     27,377     18,339     17,684     17,006     17,579     18,097     15,104     14,562     14,662     14,938     14,021
Other Costs...........................      4,080      4,845      5,952      6,464      5,346      5,191      5,249      5,574      6,790      7,253      7,333      7,429      7,607      7,759
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Note: No staff were detailed from the bureaus to the central office.

    Question. Please provide any estimated out-year costs associated 
with CAMS/CBS development.
    Answer. Since fiscal year 2004, CAMS/CBS development costs have 
been for technical migrations to keep current with Oracle forms and 
database applications to ensure information technology audit 
compliancy. There have been no application functionality developments 
except in non-compliance situations when dictated by new and/or changes 
in Federal policy or regulations.
    Question. Please provide the latest FAIR Act inventory along with 
the status of any on-going or planned A-76 competitions.
    Answer. The Department of Commerce has initiated a streamlined 
competitive sourcing competition for their Office of Photographic 
Services. A decision is expected to be announced by the Department by 
April 2007. No additional competitions are planned at this stage. The 
last OMB-approved inventory (fiscal year 2005) is attachment 4. We 
expect to have our fiscal year 2006 inventory approved and released by 
OMB in the next few weeks and will notify Congress at that time. There 
has been no substantial change between the 2005 and 2006 inventories.
    The link to the website is: http://oamweb.osec.doc.gov/
CS_doc_inventories.html

                                                                                          ATTACHMENT 4
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                             Total CY                  Reim CY
 Seq. No.        Agency/Bureau                                                  Department/Agency/Bureau Title                                                 FTEs     Dir CY FTEs      FTEs
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                  Department of Agriculture:
  05060003 005-03                     Office of the Secretary..........................................................................................           87           87  ...........
  05060004 005-04                     Executive Operations.............................................................................................        3,376          390        2,986
  05060005 005-07                     Office of Civil Rights...........................................................................................          191          181           10
  05060006 005-05                     Departmental Administration......................................................................................          394          327           67
  05060007 005-06                     Office of Communications.........................................................................................           90           90  ...........
  05060008 005-08                     Office of the Inspector General..................................................................................          721          721  ...........
  05060010 005-10                     Office of the General Counsel....................................................................................          330          321            9
  05060013 005-13                     Economic Research Service........................................................................................          455          452            3
  05060015 005-15                     National Agricultural Statistics Service.........................................................................        1,366        1,260          106
  05060018 005-18                     Agricultural Research Service....................................................................................        8,794        8,598          196
  05060020 005-20                     Cooperative State Research, Education, and Extension Service.....................................................          451          442            9
  05060032 005-32                     Animal and Plant Health Inspection Service.......................................................................        6,761        5,928          833
  05060035 005-35                     Food Safety and Inspection Service...............................................................................        9,761        9,525          236
  05060037 005-37                     Grain Inspection, Packers and Stockyards Administration..........................................................          725          338          387
  05060045 005-45                     Agricultural Marketing Service...................................................................................        3,455        2,344        1,111
  05060047 005-47                     Risk Management Agency...........................................................................................          568          568  ...........
  05060049 005-49                     Farm Service Agency..............................................................................................        5,498        2,134        3,364
  05060053 005-53                     Natural Resources Conservation Service...........................................................................       13,627       12,488        1,139
  05060055 005-55                     Rural Development................................................................................................        6,872        1,686        5,186
  05060068 005-68                     Foreign Agricultural Service.....................................................................................        1,002          812          190
  05060084 005-84                     Food and Nutrition Service.......................................................................................        1,488        1,488  ...........
  05060096 005-96                     Forest Service...................................................................................................       37,298       35,414        1,884
                                                                                                                                                        ----------------------------------------
  050600ZZ                              Total, Department of Agriculture...............................................................................      103,310       85,594       17,716
                                                                                                                                                        ========================================
                                  Department of Commerce:
  05061005 006-05                     Departmental Management..........................................................................................        1,134          363          771
  05061006 006-06                     Economic Development Administration..............................................................................          247          240            7
  05061008 006-07                     Bureau of the Census.............................................................................................        9,401        6,659        2,742
  05061009 006-08                     Economic and Statistical Analysis................................................................................          552          525           27
  05061025 006-25                     International Trade Administration...............................................................................        2,602        2,553           49
  05061030 006-30                     Bureau of Industry and Security..................................................................................          418          414            4
  05061040 006-40                     Minority Business Development Agency.............................................................................          115          115  ...........
  05061048 006-48                     National Oceanic and Atmospheric Administration..................................................................       12,634       11,769          865
  05061051 006-51                     U.S. Patent and Trademark Office.................................................................................        7,198  ...........        7,198
  05061053 006-53                     Technology Administration........................................................................................           31           30            1
  05061054 006-54                     National Technical Information Service...........................................................................          200  ...........          200
  05061055 006-55                     National Institute of Standards and Technology...................................................................        3,028        2,334          694
  05061060 006-60                     National Telecommunications and Information Administration.......................................................          295          128          167
                                                                                                                                                        ----------------------------------------
  050610ZZ                              Total, Department of Commerce..................................................................................       37,855       25,130       12,725
                                                                                                                                                        ========================================
                                  Department of Defense--Military:
  05062010 007-10                     Operation and Maintenance........................................................................................      433,191      353,892       79,299
  05062020 007-20                     Research, Development, Test, and Evaluation......................................................................       26,823       14,717       12,106
  05062025 007-25                     Military Construction............................................................................................        7,893        1,962        5,931
  05062030 007-30                     Family Housing...................................................................................................        2,030        2,021            9
  05062040 007-40                     Revolving and Management Funds...................................................................................      189,952  ...........      189,952
                                                                                                                                                        ----------------------------------------
  050620ZZ                              Total, Department of Defense--Military.........................................................................      659,889      372,592      287,297
                                                                                                                                                        ========================================
                                  Department of Education:
  05072030 018-30                     Office of Vocational and Adult Education.........................................................................           20           20  ...........
  05072040 018-40                     Office of Postsecondary Education................................................................................            5            5  ...........
  05072045 018-45                     Federal Student Aid..............................................................................................        1,140        1,140  ...........
  05072050 018-50                     Institute of Education Sciences..................................................................................           16           16  ...........
  05072080 018-80                     Departmental Management..........................................................................................        3,273        3,273  ...........
                                                                                                                                                        ----------------------------------------
  050720ZZ                              Total, Department of Education.................................................................................        4,454        4,454  ...........
                                                                                                                                                        ========================================
                                  Department of Energy:
  05073005 019-05                     National Nuclear Security Administration.........................................................................        2,543        2,543  ...........
  05073010 019-10                     Environmental and Other Defense Activities.......................................................................        2,566        2,566  ...........
  05073020 019-20                     Energy Programs..................................................................................................        4,660        3,373        1,287
  05073050 019-50                     Power Marketing Administration...................................................................................        4,711        1,264        3,447
  05073060 019-60                     Departmental Administration......................................................................................        1,442        1,442  ...........
                                                                                                                                                        ----------------------------------------
  050730ZZ                              Total, Department of Energy....................................................................................       15,922       11,188        4,734
                                                                                                                                                        ========================================
                                  Department of Health and Human Services:
  05074010 009-10                     Food and Drug Administration.....................................................................................        9,696        7,957        1,739
  05074015 009-15                     Health Resources and Services Administration.....................................................................        1,590        1,445          145
  05074017 009-17                     Indian Health Services...........................................................................................       13,950        8,909        5,041
  05074020 009-20                     Centers for Disease Control and Prevention.......................................................................        7,917        6,683        1,234
  05074025 009-25                     National Institutes of Health....................................................................................       17,106       11,875        5,231
  05074030 009-30                     Substance Abuse and Mental Health Services Administration........................................................          508          466           42
  05074033 009-33                     Agency for Healthcare Research and Quality.......................................................................          286  ...........          286
  05074038 009-38                     Centers for Medicare and Medicaid Services.......................................................................        4,852        4,780           72
  05074070 009-70                     Administration for Children and Families.........................................................................        1,382        1,382  ...........
  05074075 009-75                     Administration on Aging..........................................................................................          126          119            7
  05074090 009-90                     Departmental Management..........................................................................................        1,896        1,400          496
  05074091 009-91                     Program Support Center...........................................................................................        1,491           37        1,454
  05074092 009-92                     Office of the Inspector General..................................................................................        1,506          278        1,228
                                                                                                                                                        ----------------------------------------
  050740ZZ                              Total, Department of Health and Human Services.................................................................       62,306       45,331       16,975
                                                                                                                                                        ========================================
                                  Department of Homeland Security:
  05074510 024-10                     Departmental Management..........................................................................................          905          903            2
  05074520 024-20                     Office of the Inspector General..................................................................................          502          502  ...........
  05074530 024-30                     Citizenship and Immigration Services.............................................................................       10,052       10,052  ...........
  05074540 024-40                     United States Secret Service.....................................................................................        6,516        6,516  ...........
  05074550 024-50                     Border and Transportation Security...............................................................................      112,932      105,441        7,491
  05074560 024-60                     United States Coast Guard........................................................................................        7,036        6,274          762
  05074570 024-70                     Emergency Preparedness and Response..............................................................................        4,792        4,374          418
  05074580 024-80                     Science and Technology...........................................................................................          320          320  ...........
  05074590 024-90                     Information Analysis and Infrastructure Protection...............................................................          803          803  ...........
                                                                                                                                                        ----------------------------------------
  050745ZZ                              Total, Department of Homeland Security.........................................................................      143,858      135,185        8,673
                                                                                                                                                        ========================================
  05075035 025-35                 Department of Housing and Urban Development: Management and Administration...........................................       10,028        5,372        4,656
                                                                                                                                                        ========================================
                                  Department of the Interior:
  05076004 010-04                     Bureau of Land Management........................................................................................       11,065       10,691          374
  05076006 010-06                     Minerals Management Service......................................................................................        1,763        1,632          131
  05076008 010-08                     Office of Surface Mining Reclamation and Enforcement.............................................................          580          577            3
  05076010 010-10                     Bureau of Reclamation............................................................................................        5,757        3,087        2,670
  05076011 010-11                     Central Utah Project.............................................................................................           17           17  ...........
  05076012 010-12                     United States Geological Survey..................................................................................        8,950        6,007        2,943
  05076018 010-18                     United States Fish and Wildlife Service..........................................................................        9,378        8,605          773
  05076024 010-24                     National Park Service............................................................................................       20,671       19,983          688
  05076076 010-76                     Bureau of Indian Affairs.........................................................................................        9,605        8,901          704
  05076084 010-84                     Departmental Management..........................................................................................        1,810          479        1,331
  05076085 010-85                     Insular Affairs..................................................................................................           40           40  ...........
  05076086 010-86                     Office of the Solicitor..........................................................................................          422          366           56
  05076087 010-88                     Office of Inspector General......................................................................................          270          270  ...........
  05076088 010-91                     Natural Resources Damage Assessment and Restoration..............................................................            6            6  ...........
  05076089 010-90                     Office of Special Trustee for American Indians...................................................................          581          581  ...........
  05076092 010-92                     National Indian Gaming Commission................................................................................           81           81  ...........
                                                                                                                                                        ----------------------------------------
  050760ZZ                              Total, Department of the Interior..............................................................................       70,996       61,323        9,673
                                                                                                                                                        ========================================
                                  Department of Justice:
  05077003 011-03                     General Administration...........................................................................................        3,645        2,805          840
  05077004 011-04                     United States Parole Commission..................................................................................          104          104  ...........
  05077005 011-05                     Legal Activities and U.S. Marshals...............................................................................       22,694       19,159        3,535
  05077010 011-10                     Federal Bureau of Investigation..................................................................................       31,939       29,081        2,858
  05077012 011-12                     Drug Enforcement Administration..................................................................................       10,644        9,189        1,455
  05077014 011-14                     Bureau of Alcohol, Tobacco, Firearms, and Explosives.............................................................        4,940        4,885           55
  05077020 011-20                     Federal Prison System............................................................................................       41,565       38,466        3,099
  05077021 011-21                     Office of Justice Programs.......................................................................................          964          947           17
                                                                                                                                                        ----------------------------------------
  050770ZZ                              Total, Department of Justice...................................................................................      116,495      104,636       11,859
                                                                                                                                                        ========================================
                                  Department of Labor:
  05078005 012-05                     Employment and Training Administration...........................................................................        1,209        1,206            3
  05078011 012-11                     Employee Benefits Security Administration........................................................................          887          887  ...........
  05078012 012-12                     Pension Benefit Guaranty Corporation.............................................................................          806  ...........          806
  05078015 012-15                     Employment Standards Administration..............................................................................        4,120        3,992          128
  05078018 012-18                     Occupational Safety and Health Administration....................................................................        2,208        2,203            5
  05078019 012-19                     Mine Safety and Health Administration............................................................................        2,187        2,187  ...........
  05078020 012-20                     Bureau of Labor Statistics.......................................................................................        2,475        2,445           30
  05078025 012-25                     Departmental Management..........................................................................................        2,884        2,181          703
                                                                                                                                                        ----------------------------------------
  050780ZZ                              Total, Department of Labor.....................................................................................       16,776       15,101        1,675
                                                                                                                                                        ========================================
                                  Department of State:
  05079005 014-05                     Administration of Foreign Affairs................................................................................       29,685       18,895       10,790
  05079015 014-15                     International Commissions........................................................................................          307          273           34
  05079025 014-25                     Other............................................................................................................          292          292  ...........
                                                                                                                                                        ----------------------------------------
  050790ZZ                              Total, Department of State.....................................................................................       30,284       19,460       10,824
                                                                                                                                                        ========================================
                                  Department of Transportation:
  05080004 021-04                     Office of the Secretary..........................................................................................          868          596          272
  05080012 021-12                     Federal Aviation Administration..................................................................................       47,659       46,307        1,352
  05080015 021-15                     Federal Highway Administration...................................................................................        3,133        3,104           29
  05080017 021-17                     Federal Motor Carrier Safety Administration......................................................................        1,098        1,046           52
  05080018 021-18                     National Highway Traffic Safety Administration...................................................................          673          673  ...........
  05080027 021-27                     Federal Railroad Administration..................................................................................          827          827  ...........
  05080036 021-36                     Federal Transit Administration...................................................................................          527          527  ...........
  05080040 021-40                     Saint Lawrence Seaway Development Corporation....................................................................          157  ...........          157
  05080050 021-50                     Pipeline and Hazardous Materials Safety Administration...........................................................          415          384           31
  05080053 021-53                     Research and Innovative Technology Administration................................................................          620           21          599
  05080056 021-56                     Office of Inspector General......................................................................................          430          372           58
  05080061 021-61                     Surface Transportation Board.....................................................................................          150          141            9
  05080070 021-70                     Maritime Administration..........................................................................................          827          462          365
                                                                                                                                                        ----------------------------------------
  050800ZZ                              Total, Department of Transportation............................................................................       57,384       54,460        2,924
                                                                                                                                                        ========================================
                                  Department of the Treasury:
  05081005 015-05                     Departmental Offices.............................................................................................        3,035        2,016        1,019
  05081006 015-04                     Financial Crimes Enforcement Network.............................................................................          309          309  ...........
  05081010 015-10                     Financial Management Service.....................................................................................        2,134        2,044           90
  05081013 015-13                     Alcohol and Tobacco Tax and Trade Bureau.........................................................................          559          544           15
  05081020 015-20                     Bureau of Engraving and Printing.................................................................................        2,400  ...........        2,400
  05081025 015-25                     United States Mint...............................................................................................        2,108  ...........        2,108
  05081035 015-35                     Bureau of the Public Debt........................................................................................        1,318        1,301           17
  05081045 015-45                     Internal Revenue Service.........................................................................................       97,440       96,434        1,006
  05081057 015-57                     Comptroller of the Currency......................................................................................        2,791  ...........        2,791
  05081058 015-58                     Office of Thrift Supervision.....................................................................................          920  ...........          920
                                                                                                                                                        ----------------------------------------
  050810ZZ                              Total, Department of the Treasury..............................................................................      113,014      102,648       10,366
                                                                                                                                                        ========================================
                                  Department of Veterans Affairs:
  05082015 029-15                     Medical Programs.................................................................................................      203,112      197,758        5,354
  05082025 029-25                     Benefits Programs................................................................................................       14,296       13,482          814
  05082040 029-40                     Departmental Administration......................................................................................        4,447        2,516        1,931
                                                                                                                                                        ----------------------------------------
  050820ZZ                              Total, Department of Veterans Affairs..........................................................................      221,855      213,756        8,099
                                                                                                                                                        ========================================
                                  Major Independents:
  07082500 202-00                     Corps of Engineers--Civil Works..................................................................................       23,522       22,422        1,100
                                                                                                                                                        ========================================
                                      Other Defense Civil Programs:
  07082615 200-15                         American Battle Monuments Commission.........................................................................          390          390  ...........
  07082620 200-20                         Armed Forces Retirement Home.................................................................................          485          485  ...........
  07082625 200-25                         Cemeterial Expenses..........................................................................................          100          100  ...........
  07082645 200-45                         Selective Service System.....................................................................................          154          154  ...........
                                                                                                                                                        ----------------------------------------
  070826ZZ                                  Total, Other Defense Civil Programs........................................................................        1,129        1,129  ...........
                                                                                                                                                        ========================================
  07083000 020-00                     Environmental Protection Agency..................................................................................       17,635       17,166          469
  07083200 100-00                     Executive Office of the President................................................................................        1,832        1,831            1
                                                                                                                                                        ========================================
                                      General Services Administration:
  07084005 023-05                         Real Property Activities.....................................................................................        5,759  ...........        5,759
  07084010 023-10                         Supply and Technology Activities.............................................................................        4,533           61        4,472
  07084030 023-30                         General Activities...........................................................................................        2,443          956        1,487
                                                                                                                                                        ----------------------------------------
  070840ZZ                                  Total, General Services Administration.....................................................................       12,735        1,017       11,718
                                                                                                                                                        ========================================
                                      International Assistance Programs:
  07084503 184-03                         Millennium Challenge Corporation.............................................................................          133          133  ...........
  07084515 184-15                         Agency for International Development.........................................................................        2,337        2,211          126
  07084520 184-20                         Overseas Private Investment Corporation......................................................................          225          225  ...........
  07084525 184-25                         Trade and Development Agency.................................................................................           50           50  ...........
  07084535 184-35                         Peace Corps..................................................................................................        1,171        1,168            3
  07084540 184-40                         Inter-American Foundation....................................................................................           47           47  ...........
  07084550 184-50                         African Development Foundation...............................................................................           32           32  ...........
                                                                                                                                                        ----------------------------------------
  070845ZZ                                  Total, International Assistance Programs...................................................................        3,995        3,866          129
                                                                                                                                                        ========================================
  07085000 026-00                     National Aeronautics and Space Administration....................................................................       19,440       19,271          169
  07085200 422-00                     National Science Foundation......................................................................................        1,301        1,301  ...........
  07086000 027-00                     Office of Personnel Management...................................................................................        4,097          990        3,107
  07087000 028-00                     Small Business Administration....................................................................................        4,189        4,178           11
  07090000 016-00                     Social Security Administration...................................................................................       64,205       63,405          800
                                  Other Independents:
  08106000 306-00                     Advisory Council on Historic Preservation........................................................................           45           35           10
  08109000 309-00                     Appalachian Regional Commission..................................................................................           11           11  ...........
  08110000 310-00                     Architectural and Transportation Barriers Compliance Board.......................................................           30           30  ...........
  08113000 313-00                     Barry Goldwater Scholarship and Excellence in Education Foun.....................................................            2            2  ...........
  08114500 514-00                     Broadcasting Board of Governors..................................................................................        2,341        2,341  ...........
  08116500 510-00                     Chemical Safety and Hazard Investigation Board...................................................................           42           42  ...........
  08118500 465-00                     Christopher Columbus Fellowship Foundation.......................................................................            1            1  ...........
  08123000 323-00                     Commission of Fine Arts..........................................................................................           10           10  ...........
  08126000 326-00                     Commission on Civil Rights.......................................................................................           60           60  ...........
  08137000 338-00                     Committee for Purchase from People Who Are Blind or Severely.....................................................           29           29  ...........
  08138000 339-00                     Commodity Futures Trading Commission.............................................................................          491          491  ...........
  08142000 343-00                     Consumer Product Safety Commission...............................................................................          471          471  ...........
  08142500 485-00                     Corporation for National and Community Service...................................................................          589          589  ...........
  08145000 511-00                     Court Services and Offender Supervision Agency for the Distr.....................................................        1,390        1,390  ...........
  08146000 347-00                     Defense Nuclear Facilities Safety Board..........................................................................          100          100  ...........
  08146200 517-00                     Delta Regional Authority.........................................................................................            3            3  ...........
  08146500 513-00                     Denali Commission................................................................................................           12           12  ...........
  08148500 525-00                     Election Assistance Commission...................................................................................           23           23  ...........
  08149000 350-00                     Equal Employment Opportunity Commission..........................................................................        2,441        2,421           20
  08150000 351-00                     Export-Import Bank of the United States..........................................................................          420          420  ...........
  08151000 352-00                     Farm Credit Administration.......................................................................................          294  ...........          294
  08154000 355-00                     Farm Credit System Insurance Corporation.........................................................................           10           10  ...........
  08155000 356-00                     Federal Communications Commission................................................................................        1,999           21        1,978
                                                                                                                                                        ========================================
                                      Federal Deposit Insurance Corporation:
  08156010 357-10                         Bank Insurance...............................................................................................        4,223        4,223  ...........
  08156020 357-20                         Savings Association Insurance................................................................................          619          619  ...........
  08156030 357-30                         FSLIC Resolution.............................................................................................          228          228  ...........
  08156040 357-40                         FDIC--Office of Inspector General............................................................................          160          160  ...........
                                                                                                                                                        ----------------------------------------
  081560ZZ                                  Total, Federal Deposit Insurance Corporation...............................................................        5,230        5,230  ...........
                                                                                                                                                        ========================================
  08159000 360-00                     Federal Election Commission......................................................................................          391          391  ...........
  08161000 362-00                     Federal Financial Institutions Examination Council Appraisal.....................................................            7            7  ...........
  08163000 364-00                     Federal Housing Finance Board....................................................................................          146  ...........          146
  08164000 365-00                     Federal Labor Relations Authority................................................................................          175          175  ...........
  08165000 366-00                     Federal Maritime Commission......................................................................................          133          133  ...........
  08166000 367-00                     Federal Mediation and Conciliation Service.......................................................................          285          276            9
  08167000 368-00                     Federal Mine Safety and Health Review Commission.................................................................           45           45  ...........
  08168000 369-00                     Federal Retirement Thrift Investment Board.......................................................................          101          101  ...........
  08169000 370-00                     Federal Trade Commission.........................................................................................        1,080          430          650
  08171000 372-00                     Harry S. Truman Scholarship Foundation...........................................................................            5            5  ...........
  08173500 467-00                     Intelligence Community Management Account........................................................................          318          318  ...........
  08177000 378-00                     International Trade Commission...................................................................................          380          380  ...........
  08180000 381-00                     James Madison Memorial Fellowship Foundation.....................................................................            6            6  ...........
  08181000 382-00                     Japan-United States Friendship Commission........................................................................            6            6  ...........
  08186000 387-00                     Marine Mammal Commission.........................................................................................           11           11  ...........
  08188000 389-00                     Merit Systems Protection Board...................................................................................          228          202           26
  08188500 487-00                     Morris K. Udall Scholarship and Excellence in National Envir.....................................................           29           29  ...........
  08192000 393-00                     National Archives and Records Administration.....................................................................        2,870        1,459        1,411
  08193000 394-00                     National Capital Planning Commission.............................................................................           57           57  ...........
  08199000 400-00                     National Commission on Libraries and Information Science.........................................................            6            6  ...........
  08212000 413-00                     National Council on Disability...................................................................................           14           14  ...........
  08214000 415-00                     National Credit Union Administration.............................................................................          963            2          961
  08216000 417-00                     National Endowment for the Arts..................................................................................          160          160  ...........
  08217000 418-00                     National Endowment for the Humanities............................................................................          175          170            5
  08217500 474-00                     Institute of Museum and Library Services.........................................................................           57           57  ...........
  08219000 420-00                     National Labor Relations Board...................................................................................        1,865        1,865  ...........
  08220000 421-00                     National Mediation Board.........................................................................................           52           52  ...........
  08223000 424-00                     National Transportation Safety Board.............................................................................          416          416  ...........
  08228000 429-00                     Nuclear Regulatory Commission....................................................................................        3,125        3,108           17
  08230000 431-00                     Nuclear Waste Technical Review Board.............................................................................           18           18  ...........
  08231000 432-00                     Occupational Safety and Health Review Commission.................................................................           69           69  ...........
  08233000 434-00                     Office of Government Ethics......................................................................................           80           80  ...........
  08234000 435-00                     Office of Navajo and Hopi Indian Relocation......................................................................           51           51  ...........
  08235000 436-00                     Office of Special Counsel........................................................................................          113          113  ...........
  08240000 512-00                     Presidio Trust...................................................................................................          307  ...........          307
  08245000 446-00                     Railroad Retirement Board........................................................................................        1,025          975           50
  08248000 449-00                     Securities and Exchange Commission...............................................................................        3,933        3,932            1
  08251000 452-00                     Smithsonian Institution..........................................................................................        5,577        5,577  ...........
  08254000 455-00                     Tennessee Valley Authority.......................................................................................       12,019  ...........       12,019
  08254600 345-00                     United States Court of Appeals for Veterans Claims...............................................................           98           98  ...........
  08255000 456-00                     United States Holocaust Memorial Museum..........................................................................          248          248  ...........
                                                                                                                                                        ----------------------------------------
  99999999                              Report Total...................................................................................................    1,871,194    1,427,590      443,604
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    Question. Please provide a funding estimate for the DOC portion of 
the HCHB renovation by fiscal year for the project.
    Answer. The Department is requesting $4.3 million for its portion 
of the HCHB renovation in fiscal year 2008. The total estimated cost 
for the Department is $21.6 million, through 2020.
    Question. Please provide an itemized listing of the $4.3 million 
requested for HCHB renovation.
    Answer. The itemized listing of the $4.3 million requested for HCHB 
renovation follows:

------------------------------------------------------------------------
                                                              Amount
------------------------------------------------------------------------
Relocation and Planning.................................        $156,000
DOC Construction Costs..................................       1,441,000
Equipment and Furniture.................................       2,117,000
Security................................................          56,000
IT......................................................         530,000
                                                         ---------------
      Total.............................................       4,300,000
------------------------------------------------------------------------

    Question. How much does DOC spend on maintenance of the HCHB? What 
is the source of those funds? Does GSA provide any funding to support 
HCHB maintenance?
    Answer. DOC spent approximately $12,413,000 for maintenance of the 
HCHB in fiscal year 2006. The source of funds is from the HCHB tenants 
through the Departmental Management's Working Capital Fund. GSA does 
not provide any funding to support HCHB maintenance.
                departmental management--media questions
    Question. We understand that Commerce has been revising its over 20 
year old communications policy for the last few months. What is the 
status of the policy and when can we expect it to be released and 
implemented?
    Answer. On March 29, the Department released its new public 
communication policy, following three separate rounds of internal input 
from our employees, in particular our scientists, on the draft policy. 
The policy will take effect on May 14, following a 45 day time period 
to conduct training and outreach sessions with employees.
    Question. What steps will the Department take to ensure that all 
staff are informed of and understand how to implement the policy?
    Answer. We have publicly released the policy along with 
``Frequently Asked Question'' document, and placed both on our website. 
We are providing a 45 day window of time before the policy takes effect 
in order to conduct training and outreach sessions with current 
employees. We are also considering ways to require annual ``refresher'' 
sessions as well as to require training for new employees.
    Question. Will the revised policy include language to specifically 
address recent concerns raised by scientists regarding interference 
with the dissemination of their research results?
    Answer. Yes, the new policy provides a series of clear principles 
which reiterate the Department's support for the open exchange of 
scientific ideas, information, and research. The policy also 
specifically provides for Fundamental Research Communications (a 
communications ``carve-out'' for scientific research), a series of best 
practices for public affairs employees, and provides operating units 
with the flexibility to use existing, or issue new, guidance regarding 
the implementation of the new policy (as long as it is consistent with 
the Department policy).
    Question. Specifically, will the new policy define the types of 
media contacts, press releases, presentations, or other documents that 
would be subject to the policy?
    Answer. Yes, the policy provides clear definitions of what types of 
documents are covered by the policy.
    Question. Describe situations, if any, in which prior approval is 
required for press releases and media interviews.
    Answer. Yes, the policy describes the situations, if applicable, 
which require prior approval for press releases and media interviews.
    Question. If prior approval is required, describe the specific 
process for approving press releases and media interviews.
    Answer. The Department's policy provides an overall conceptual 
framework for public communications, and set general Department-wide 
guidelines. Because the 13 agencies within the Department are so 
diverse, the new policy will provide operating units the flexibility to 
continue to set more specific procedures, which must be consistent with 
the overall Department policy.
    Question. Explicitly delegate authority to approve releases or 
interviews of a time sensitive nature or local interest to appropriate 
levels within the Commerce agencies.
    Answer. Yes, the new policy explicitly delegates authority to 
approve releases or interviews of a time sensitive or local interest to 
appropriate levels within the Commerce agencies.
    Question. Affirm that scientists can express personal views and 
share those views with the media as long as they declare them to be 
their own.
    Answer. Yes, the policy specifically includes a section explaining 
how employees may communicate their personal views with an appropriate 
disclaimer.
    Question. Define the role of the Office of Public Affairs office 
with regard to facilitating the dissemination of research.
    Answer. Yes, the new policy defines the role of the Office of 
Public Affairs with regard to facilitating the dissemination of 
research. Each operating unit will have the flexibility to continue to 
use existing or issue new guidance regarding the implementation and 
interpretation of the policy, which must comport with the overall 
Department policy.
    Question. Delineate a process to resolve disputes regarding 
dissemination of research.
    Answer. Yes, the new policy delineates a process to resolve 
disputes regarding dissemination of research.
                         special bill language
    Question. Please provide an explanation/background of each of the 
provisions within the Commerce portion of the appropriations bill. For 
example, under ITA there is the following provision, ``purchase or 
construction of temporary demountable exhibition structures for use 
abroad.'' Why is special language required? Isn't this a ``necessary'' 
expense?
Census Bureau (Account: PC&P)
    ``: Provided, That none of the funds provided in this or any other 
Act for any fiscal year may be used for the collection of Census data 
on race identification that does not include `some other race' as a 
category.''
    Census was considering eliminating the ``Some Other Race'' category 
on the questionnaire and putting the Hispanic check box at the top of 
the list. Congress opposed that option out of concern that it would 
deter Hispanics' self-identification of those who did not also fit into 
any of the standard race categories, thereby possibly under recording 
Hispanic populations.
Departmental Management (Account: S&E)
    ``For expenses necessary for the departmental management of the 
Department of Commerce provided for by law, including not to exceed 
$5,000 for official entertainment, $47,466,000: Provided, That not to 
exceed 11 full-time equivalents and $1,490,000 shall be expended for 
the legislative affairs function of the Department.''
    Appropriated funds may not be used for entertainment expenses 
except when specifically authorized by law. This provision authorizes 
the Secretary to use up to $5,000 from appropriated funds for 
entertaining foreign dignitaries and U.S. citizens who are involved in 
activities of interest to the Department.
    Congress added language imposing a ceiling on the legislative 
affairs function of the Department was included beginning in the fiscal 
year 2004 Appropriations Act.
International Trade Administration
    ``For necessary expenses for international trade activities of the 
Department of Commerce provided for by law, and for engaging in trade 
promotional activities abroad, including expenses of grants and 
cooperative agreements for the purpose of promoting exports of United 
States firms, without regard to the provisions of law set forth in 44 
U.S.C. 3702 and 3703;''
    44 U.S.C. 3702 specifies that an executive department may not 
publish or pay for advertisements without written authority from the 
head of that department.
    The nature of ITA's overseas exhibition program requires maximum 
flexibility in advertising requirements since exhibitions may be 
changed, added, or canceled. When such changes take place, 
advertisements must be placed as soon as possible to inform the local 
business community. This exception from 44 U.S.C. 3702 will provide the 
flexibility, which is required to effectively advertise for these 
exhibitions.
    44 U.S.C. 3703 stipulates that prices paid for advertising may not 
exceed the commercial rates charged to private individuals, with the 
usual discounts. Since the United States Government does not have 
sovereign status in other countries and is charged commercial rates 
without the discounts required by 44 U.S.C. 3703, this exception is 
necessary to permit contracting in a manner which conforms to the 
realities of foreign advertising markets.
    ``full medical coverage for dependent members of immediate families 
of employees stationed overseas and employees temporarily posted 
overseas;''
    This language permits the International Trade Administration to 
extend to certain of its overseas employees the same benefits afforded 
domestically employed Federal employees and employees of ITA's Foreign 
Commercial Service in equivalent positions overseas.
    ``travel and transportation of employees of the United States and 
Foreign Commercial Service between two points abroad, without regard to 
49 U.S.C. 40118;''
    49 U.S.C.  40118(d) exempts State and USAID officials from the 
requirement that government travel between two points outside the 
United States be accomplished by U.S. air carrier. This phrase 
clarifies that U.S. and Foreign Commercial Service officers are 
included in the exemption, notwithstanding a Comptroller General 
decision to the contrary. This exemption is necessary and appropriate 
in that most of the travel undertaken by U.S. and Foreign Commercial 
Service officers occurs abroad, where U.S. air carriers are generally 
not reasonably available.
    ``employment of Americans and aliens by contract for services;''
    44 CG 761, OPM guidance, and House Report 89-188 have concluded 
that Federal agencies must have specific authority to employ personnel 
by contract. In order to present its overseas exhibitions, ITA often 
requires the use of narrators, demonstrators, receptionists, clerical, 
and facilities maintenance personnel who speak the language of the host 
country; are familiar with local practices and procedures; or who only 
need to be employed for a short period of time. In addition, in some 
cases, it is more advantageous to employ U.S. citizens in the host 
country (generally members of an employee's family) because they have 
greater familiarity with American methods and, therefore, require less 
effort to train.
    ``rental of space abroad for periods not exceeding 10 years, and 
expenses of alteration, repair, or improvement;''
    Buildings, pavilions, and space in such structures must be rented 
for overseas exhibitions. However, rental terms are typically set by 
schedules established by fair authorities and are not negotiated or 
established competitively. In addition, organizers may limit the build-
out to approved contractors at scheduled prices. This phrase clarifies 
that ITA may enter into leases for real property and make such 
improvements as are necessary without limitation.
    ``purchase or construction of temporary demountable exhibition 
structures for use abroad;''
    40 U.S.C. 601 prohibits the construction of public buildings except 
by the Administrator of the General Services Administration. Authority 
to purchase or construct such demountable structures is necessary to 
allow ITA to present exhibitions overseas when permanent exhibition 
facilities are not available.
    ``payment of tort claims, in the manner authorized in the first 
paragraph of 28 U.S.C. 2672 when such claims arise in foreign 
countries;''
    28 U.S.C. 2672 provides for settlement of tort claims for monetary 
damages of $25,000 or less against the Unites States by the head of 
each federal agency for loss of property or personal injury or death 
caused by a negligent or wrongful act or omission of any employee of 
the Government while acting within the scope of his employment in 
circumstances where the United States, if a private person, would be 
liable under local law. However, 28 U.S.C. 2680 exempts the settlement 
of tort claims which arise abroad from the provisions of 28 U.S.C. 
2672. The language exempts ITA from 22 U.S.C. 2680 and covers the 
settlement of tort claims against the United States, which arise in 
connection with the ITA's trade promotion activities abroad.
    ``not to exceed $327,000 for official representation expenses 
abroad;''
    Appropriated Funds are generally not available for official 
representation, absent specific statutory authority. This gives ITA the 
authority to spend up to $327,000 on official representation abroad.
    ``purchase of passenger motor vehicles for official use abroad, not 
to exceed $45,000 per vehicle; obtaining insurance on official motor 
vehicles, and rental of tie lines;''
    Per 31 U.S.C. 1343, an appropriation may be expended to purchase 
passenger motor vehicles only as specifically authorized by law and 
places certain limitations on the total cost of such vehicles. The 
annual appropriations act sets the general limits on the total cost of 
the vehicles. This language provides ITA with the authority to exceed 
the general amount (up to $45,000) so that it can purchase vehicles 
abroad.
    ``$406,925,000, to remain available until September 30, 2007, of 
which $8,000,000 is to be derived from fees to be retained and used by 
the International Trade Administration, notwithstanding 31 U.S.C. 
3302''
    Per 31 U.S.C. 3302, agencies may not retain or use fees unless 
specifically authorized by law. This language provides ITA the 
necessary authorization to use these collections to offset its 
appropriation.
    ``That negotiations shall be conducted within the World Trade 
Organization to recognize the right of members to distribute monies 
collected from antidumping and countervailing duties:''
    This language added by Congress directed ITA to work with USTR to 
continue negotiations with the WTO regarding the ``Byrd Amendment''. In 
2003, the WTO ruled the Continued Dumping and Subsidy Offset Act of 
2000 or ``CDSOA'' (Byrd Amendment), which provides for the distribution 
of duties to the domestic parties that supported the petition under 
certain circumstance, was not in compliance.
    When the President signed the Deficit Reduction Act of 2005 on 
February 8, 2006, legislation was enacted that will bring the United 
States into compliance with the WTO Dispute Settlement Body ruling on 
the Byrd Amendment--the legislation repeals the Byrd Amendment for 
entries made on or after October 1, 2007.
    ``: Provided further, That the provisions of the first sentence of 
section 105(f) and all of section 108(c) of the Mutual Educational and 
Cultural Exchange Act of 1961 (22 U.S.C. 2455(f) and 2458(c)) shall 
apply in carrying out these activities without regard to section 5412 
of the Omnibus Trade and Competitiveness Act of 1988 (15 U.S.C. 
4912);''
    Having the references to 22 U.S.C. 2245(f) and 2458(c) in the 
annual appropriations act permits the International Trade 
Administration (ITA) to accept, retain, and expend or otherwise utilize 
contributions of funds, property, and services from foreign 
governments, international organizations and private individuals, 
firms, associations, agencies and other groups for the purposes of 
furthering ITA's mission as generally defined in the annual 
appropriations act, namely trade promotion and international trade 
activities. Among other activities, ITA relies on this authority to 
charge, retain, and expend fees for export promotion services 
benefiting individual U.S. exporters.
    15 U.S.C. 4912 states that the Secretary shall provide reasonable 
public services and access (including electronic access) to any 
information maintained as part of the National Trade Data Bank and may 
charge reasonable fees consistent with section 552 of title 5 (the 
Freedom of Information Act, which includes specific provisions 
regarding fees to be assessed under that Act). Authorizing ITA to carry 
out these activities without regard to 15 U.S.C. 4912 allows ITA to 
charge other than the public services and access fees for export 
promotion services, even when such services rely on or incorporate data 
contained in the National Trade Data Bank.
    ``and that for the purpose of this Act, contributions under the 
provisions of the Mutual Educational and Cultural Exchange Act shall 
include payment for assessments for services provided as part of these 
activities.''
    This provision was added in 1990 to clarify a question pending at 
the time with GAO concerning whether ITA's authority to accept 
contributions under MECEA was limited to voluntary gifts. This 
explicitly gives ITA the authority to accept contributions as 
assessments or fees as well as gifts.
    ``Provided further, That the International Trade Administration 
shall be exempt from the requirements of Circular A-25 (or any 
successor administrative regulation or policy) issued by the Office of 
Management and Budget:''
    This language, inserted by Congress, increases the flexibility that 
ITA has in the establishment of prices and fees for services beyond 
that allowed by OMB Circular A-25.
    ``: Provided further, That negotiations shall be conducted within 
the World Trade Organization consistent with the negotiating objectives 
contained in the Trade Act of 2002, Public Law 107-210.''
    The principle textile and apparel negotiating objectives handed to 
the U.S. government in the Trade Act of 2002 are as follows:
    (16) Textile Negotiations.--The principle negotiating objectives of 
the United States with respect to trade in textiles and apparel 
articles are to obtain competitive opportunities for United States 
exports of textiles and apparel in foreign markets substantially 
equivalent to the competitive opportunities afforded foreign exports in 
United States markets and to achieve fairer and more open conditions of 
trade in textiles and apparel.
United States Patent and Trademark Office
    ``Provided further, That not less than 657 full-time equivalents, 
690 positions and $85,017,000 shall be for the examination of trademark 
applications; and not less than 5,810 full-time equivalents, 6,241 
positions and $906,142,000 shall be for the examination and searching 
of patent applications: Provided further, That not more than 265 full-
time equivalents, 272 positions and $37,490,000 shall be for the Office 
of the General Counsel: Provided further, That not more than 82 full-
time equivalents, 83 positions and $25,393,000 shall be for the Office 
of the Administrator for External Affairs:''
    Congress wanted to ensure that the core examination functions were 
properly staffed and funded.
    ``Provided further, That any deviation from the full-time 
equivalent, position, and funding designations set forth in the 
preceding four provisos shall be subject to the procedures set forth in 
section 605 of this Act:''
    This reprogramming provision was added after fiscal year 2005 
because the floors and ceilings are statutory and Congress had to give 
us a legal way of reprogramming if we weren't going to hit our levels. 
When we tried to reprogram in fiscal year 2005, staff pointed out that 
it was the law that we hit the levels specified, neither they nor we 
had any discretion in the matter.
    ``Provided further, That from amounts provided herein, not to 
exceed $1,000 shall be made available in fiscal year 2006 for official 
reception and representation expenses: Provided further, That 
notwithstanding section 1353 of title 31, United States Code, no 
employee of the United States Patent and Trademark Office may accept 
payment or reimbursement from a non-Federal entity for travel, 
subsistence, or related expenses for the purpose of enabling an 
employee to attend and participate in a convention, conference, or 
meeting when the entity offering payment or reimbursement is a person 
or corporation subject to regulation by the Office, or represents a 
person or corporation subject to regulation by the Office, unless the 
person or corporation is an organization exempt from taxation pursuant 
to section 501(c)(3) of the Internal Revenue Code of 1986:''
    Appropriators were concerned that PTO officials had been accepting 
invitational travel, usually from non-profits but occasionally from 
other entities. This also ended the invitational examiner education 
program.
    ``: Provided further, That in fiscal year 2006, from the amounts 
made available for `Salaries and Expenses' for the United States Patent 
and Trademark Office (PTO), the amounts necessary to pay: (1) the 
difference between the percentage of basic pay contributed by the PTO 
and employees under section 8334(a) of title 5, United States Code, and 
the normal cost percentage (as defined by section 8331(17) of that 
title) of basic pay, of employees subject to subchapter III of chapter 
83 of that title; and (2) the present value of the otherwise unfunded 
accruing costs, as determined by the Office of Personnel Management, of 
post-retirement life insurance and post-retirement health benefits 
coverage for all PTO employees, shall be transferred to the Civil 
Service Retirement and Disability Fund, the Employees Life Insurance 
Fund, and the Employees Health Benefits Fund, as appropriate, and shall 
be available for the authorized purposes of those accounts.''
    OPM had been paying certain amounts on behalf of USPTO for CSRS 
retirement, health insurance, and life insurance. Because PTO is fully-
user fee funded, the Administration proposed that USPTO should pay the 
full costs of its employees' benefits.
Bureau of Industry and Security
    ``That the provisions of the first sentence of section 105(f) and 
all of section 108(c) of the Mutual Educational and Cultural Exchange 
Act of 1961 (22 U.S.C. 2455(f) and 2458(c)) shall apply in carrying out 
these activities''
    The MECEA language is intended to allow BIS to receive and retain 
the funds it receives from attendees at BIS export training programs, 
such as Update. Without this language, all money received from 
attendees would have to be deposited in Treasury.
National Telecommunications and Information Administration
    ``: Provided, That notwithstanding 31 U.S.C. 1535(d), the Secretary 
of Commerce shall charge Federal agencies for costs incurred in 
spectrum management, analysis and operations, and related services and 
such fees shall be retained and used as offsetting collections for 
costs of such spectrum services, to remain available until expended.''
    In 1996, Congress asked NTIA to investigate the feasibility of 
charging federal agencies for spectrum management services. NTIA 
proposed to Congress that each agency be charged in proportion to its 
use of the spectrum, using a simple fee-per-assignment formula. As a 
result, Congress enacted language in the fiscal year 1996 
appropriation, Public Law 104-134, which authorized the Secretary of 
Commerce to charge federal agencies for spectrum management, analysis, 
operations, and related services to cover spectrum management costs.
    Because NTIA experienced significant difficulties collecting fees 
from multiple federal agencies, Congress subsequently enacted 
additional language in the fiscal year 1997 appropriation, Public Law 
104-208, which authorized the Secretary of Commerce to charge fees, but 
also specified that the federal agencies shall pay the fees charged by 
NTIA for spectrum management costs or they would have to cease using 
the spectrum.
    Through NTIA's annual appropriation, Congress has enacted this 
authority each fiscal year. Currently, NTIA uses this authority to 
collect 80 percent of its costs for spectrum management services each 
fiscal year. The specific legislative language is necessary to permit 
NTIA to continue to collect spectrum management fees without the 
particular requirements of the Economy Act (31 U.S.C. 1535(d)) being 
imposed on the transfer of funds and to prevent the expiration of funds 
transferred from other agencies for NTIA's ongoing spectrum management 
services.
    ``: Provided further, That the Secretary of Commerce is authorized 
to retain and use as offsetting collections all funds transferred, or 
previously transferred, from other Government agencies for all costs 
incurred in telecommunications research, engineering, and related 
activities by the Institute for Telecommunication Sciences of NTIA, in 
furtherance of its assigned functions under this paragraph, and such 
funds received from other Government agencies shall remain available 
until expended.''
    NTIA's laboratory in Boulder, Colorado, the Institute of 
Telecommunication Sciences, (ITS) performs spectrum-related research 
and analysis for other federal agencies on a reimbursable basis. Due to 
the nature of this work, which involves projects that do not fit into a 
fiscal year timetable, it is necessary for NTIA to ensure that the 
funds transferred from other agencies for this reimbursable work do not 
expire at the fiscal year's end. Frequently, projects and related 
funding need to be carried over into the next fiscal year. Therefore, 
NTIA continues to need authorization to prevent the expiration of funds 
transferred from other agencies for ITS reimbursable projects. 
Currently, ITS reimbursable projects constitute about 60 percent of its 
annual budget.
Operations Research and Facilities
    ``Provided, That fees and donations received by the National Ocean 
Service for the management of national marine sanctuaries may be 
retained and used for the salaries and expenses associated with those 
activities, notwithstanding 31 U.S.C. 3302:''
    Per 31 U.S.C. 3302, fees and donations are not available to be 
retained and used by agencies without specific authority.
    ``Provided further, That in addition, $3,000,000 shall be derived 
by transfer from the fund entitled `Coastal Zone Management' and in 
addition $67,000,000 shall be derived by transfer from the fund 
entitled `Promote and Develop Fishery Products and Research Pertaining 
to American Fisheries':''
    This language transfers funds from special NOAA accounts to 
Operations, Research, and Facilities account (ORF) to partially offset 
the appropriation.
    $67 million was transferred from the Promote and Develop account to 
the ORF account. The Promote and Develop account is funded by a thirty 
percent levy on imported fish product duties and transferred from the 
Department of Agriculture to the Promote and Develop American Fishery 
Products account.
    $3 million was transferred from the Coastal Zone Management Fund. 
This fund was established by the Costal Zone Act Reauthorization 
Amendments of 1990 (CZARA). The fund consists of loan repayments from 
the former Coastal energy Impact Program. The proceeds are to be used 
to offset the Operations, Research, and Facilities account for the 
costs of implementing the Coastal Zone Management Act of 1972, as 
amended.
    ``Provided further, That no general administrative charge shall be 
applied against an assigned activity included in this Act or the report 
accompanying this Act:''
    This proviso is included to forestall NOAA from paying for general 
administration via a tax on the line offices and specific projects 
contained in the report language.
    ``Provided further, That the total amount available for the 
National Oceanic and Atmospheric Administration corporate services 
administrative support costs shall not exceed $179,036,000:''
    This proviso strengthens the previous proviso and puts a hard cap 
on NOAA administration costs.
    ``Provided further, That payments of funds made available under 
this heading to the Department of Commerce Working Capital Fund 
including Department of Commerce General Counsel legal services shall 
not exceed $34,000,000:''
    This proviso is included to limit the Department's assessment of 
NOAA for Working Capital Fund costs.
    ``Provided further, That any deviation from the amounts designated 
for specific activities in the report accompanying this Act, or any use 
of deobligated balances of funds provided under this heading in 
previous years, shall be subject to the procedures set forth in section 
605 of this Act:''
    This strengthens the force of the report language by requiring a 
notification to the Appropriations Committees if NOAA deviates from it, 
and increases oversight of spending from deobligations by requiring 
notification as well.
    ``Provided further, That grants to States pursuant to sections 306 
and 306A of the Coastal Zone Management Act of 1972, as amended, shall 
not exceed $2,000,000, unless funds provided for `Coastal Zone 
Management Grants' exceed funds provided in the previous fiscal year:''
    This language requires NOAA to divide up CZM grants fairly equally 
between the states (by formula), protecting states with small 
coastlines and preventing states with long coastlines (CA, AK, FL) from 
receiving the bulk of the grant funds.
    ``Provided further, That if funds provided for `Coastal Zone 
Management Grants' exceed funds provided in the previous fiscal year, 
then no State shall receive more than 5 percent or less than 1 percent 
of the additional funds:''
    This language was inserted to ensure that if more funds were 
available for CZM than in the prior year, all participating states 
would benefit.
    ``Provided further, That the personnel management demonstration 
project established at the National Oceanic and Atmospheric 
Administration pursuant to 5 U.S.C. 4703 may be expanded by 3,500 full-
time positions to include up to 6,925 full-time positions and may be 
extended indefinitely:''
    This language expanded the scope of the payroll demonstration 
project.
    ``Provided further, That the Administrator of the National Oceanic 
and Atmospheric Administration may engage in formal and informal 
education activities, including primary and secondary education, 
related to the agency's mission goals:''
    This provides specific authorization for NOAA to engage in 
educational activities.
    ``: Provided further, That, in accordance with the Federal Credit 
Reform Act of 1990 (2 U.S.C. 611 et seq.), within funds appropriated 
under this heading, $2,000,000 shall remain available until expended, 
for the cost of loans under section 211(e) of title II of division C of 
Public Law 105-277, such loans to have terms of up to 30 years and to 
be available for use in any of the Bering Sea and Aleutian Islands 
fisheries.''
    This language provided a $2 million subsidy to cover the costs 
associated with a $200 million loan to the Community Develop Quota 
fisheries in the Bering Sea and Aleutian Islands. These loans have 
terms of up to 30 years.
Procurement, Acquisition and Construction
    ``Provided, That of the amounts provided for the National Polar-
orbiting Operational Environmental Satellite System, funds shall only 
be made available on a dollar for dollar matching basis with funds 
provided for the same purpose by the Department of Defense:''
    This proviso was included because of concern that DOD would shift 
costs to NOAA by under funding their portion of the project.
    ``Provided further, That except to the extent expressly prohibited 
by any other law, the Department of Defense may delegate procurement 
functions related to the National Polar-orbiting Operational 
Environmental Satellite System to officials of the Department of 
Commerce pursuant to section 2311 of title 10, United States Code:''
    Air Force officials asserted that NOAA officials could not perform 
certain procurement functions because they were not authorized to do 
so. This proviso was included to satisfy the need for authorization.
    ``Provided further, That any deviation from the amounts designated 
for specific activities in the report accompanying this Act, or any use 
of deobligated balances of funds provided under this heading in 
previous years, shall be subject to the procedures set forth in section 
605 of this Act:''
    This strengthens the force of the report language by requiring a 
notification to the Appropriations Committees if NOAA deviates from it, 
and increases oversight of spending from deobligations by requiring 
notification as well.
    ``Provided further, That beginning in fiscal year 2007 and for each 
fiscal year thereafter, the Secretary of Commerce shall include in the 
budget justification materials that the Secretary submits to Congress 
in support of the Department of Commerce budget (as submitted with the 
budget of the President under section 1105(a) of title 31, United 
States Code) an estimate for each National Oceanic and Atmospheric 
Administration procurement, acquisition and construction program having 
a total multiyear program cost of more than $5,000,000 and an estimate 
of the budgetary requirements for each such program for each of the 
five subsequent fiscal years:''
    This proviso was added by Congress and requires five years of 
outyear projections for programs with total costs of $5 million or 
more.
    ``Provided further, That subject to amounts provided in advance in 
appropriations Acts, the Secretary of Commerce is authorized to enter 
into a lease with The Regents of the University of California for land 
at the San Diego Campus in La Jolla for a term not less than 55 
years:''
    NOAA is seeking to replace its Southwest Fisheries Science 
Laboratory at La Jolla, CA, because it sits at the edge of a cliff that 
is receding. Because the University of California offered suitable land 
nearby but required a long-term lease, NOAA needed specific 
authorization to enter into a lease of more than 20 years in order to 
consider the offer.
    ``: Provided further, That funds appropriated for the construction 
of the National Oceanic and Atmospheric Administration Pacific Regional 
Center are an additional increment in the incremental funding planned 
for the Center, and may be expended incrementally, through multi-year 
contracts for construction and related activities, provided that 
obligations under any such multi-year contract shall be subject to the 
availability of appropriations.''
    This provides NOAA greater flexibility in spending the funds for 
the Pacific Regional Center. Usually, NOAA would require appropriations 
in an amount that would build or buy something that would be useful 
even without further appropriation. However, even the major increments 
for this project are substantially in excess of the amounts provided to 
date. Without this authorization, NOAA would not be able to spend the 
funds appropriated, and they would expire unused.
Fisheries Finance Program Account
    ``Provided, That such costs, including the cost of modifying such 
loans, shall be as defined in the Federal Credit Reform Act of 1990:''
    Loans given out under the Fisheries Finance Program are to use 
accounting principles specified under the Federal Credit Reform Act of 
1990.
    ``Provided further, That these funds are only available to 
subsidize gross obligations for the principal amount of direct loans 
not to exceed $5,000,000 for Individual Fishing Quota loans, and not to 
exceed $59,000,000 for traditional direct loans, of which $19,000,000 
may be used for direct loans to the United States menhaden fishery:''
    Provides loan authority for two loan programs.
    Direct loan authority of $5 million was given for Individual 
Fishing Quota (IFQ). These loans provide fishery wide financing to ease 
the transition to sustainable fisheries through its fishing capacity 
reduction programs and provides financial assistance in the form of 
loans to fishermen who fish from small vessels and entry level 
fishermen to promote stability and reduce consolidation in already 
rationalized fisheries.
    Provides direct loan authority of $59 million was given for 
Traditional Direct loans. Traditional Direct Loans are available to 
U.S. citizens who otherwise qualify for financing or refinancing the 
construction, reconstruction, reconditioning, and in some cases, the 
purchasing of fishing vessels, shoreside processing, aquaculture, and 
mariculture facilities. Language was also included directing that of 
the $59 million in traditional loans, priority should be given to 
providing $19 million in direct loans to the menhaden fishery.
    ``: Provided further, That none of the funds made available under 
this heading may be used for direct loans for any new fishing vessel 
that will increase the harvesting capacity in any United States 
fishery.''
    This proviso makes it unlawful for a fisherman to use Fisheries 
Finance Program loans to modify or replace a fishing vessel such that 
it would materially increase the harvesting capacity of the fishery. 
This language prevents fisheries finance program loans from 
contributing to over-fishing.
                  economic development representative
    Question. The Economic Development Representative (EDR) that 
services Maryland has been vacant for well over a year. When will this 
vacancy be filled? If not, please explain.
    Answer. The Economic Development Administration (EDA) has initiated 
the competitive civil service recruitment process to fill the vacant 
Economic Development Representative (EDR) position in the Maryland/West 
Virginia office. This office is to be located in West Virginia but 
would have convenient access to Maryland. EDA currently has five vacant 
EDR positions nationwide. Recruitment is currently underway to fill the 
three vacancies located in Maryland/West Virginia, Minnesota, and 
Missouri. EDA anticipates the recruitment process to fill the other two 
vacancies will begin sometime in April.
                       unobligated balance levels
    Question. Please provide unobligated balance levels for the S&E 
appropriation and the Economic Development Assistance Program 
appropriation for fiscal years 2001 through 2006.
    Answer. The following unobligated balance levels are provided for 
the S&E appropriation and the Economic Development Assistance Program 
appropriation for fiscal years 2001 through 2006. The EDAP balances 
primarily consist of deobligations of prior year obligations, and were 
re-obligated against new projects in subsequent years.

                        [In thousands of dollars]
------------------------------------------------------------------------
                Fiscal year \1\                     S&E          EDAP
------------------------------------------------------------------------
2001..........................................          240       63,777
2002..........................................           42       11,902
2003..........................................          338       14,826
2004..........................................      \2\ 912       15,355
2005..........................................           20       10,965
2006..........................................       \3\ 96       10,757
------------------------------------------------------------------------
\1\ Balances were for year end for each year.
\2\ Balance due to EOY DOD reimbursable credit.
\3\ As corrected.

                economic development administration cut
    Question. What will be the consequence of an $80 million cut in EDA 
grants? How many fewer projects will be funded? How many communities 
will not receive assistance?
    Answer. We believe the President's budget balances competing 
priorities and provides sufficient resources for the agency to 
accomplish its mission. A funding level of $170 million will provide 
60-65 public works-type grants and 25 economic adjustment-type 
construction grants, which will generate 19,000 new higher-skill jobs. 
EDA will focus these resources on the Nation's most distressed 
communities. EDA fiscal year 2006 and fiscal year 2007 funding levels 
supported approximately 140 investments.
                           staffing breakout
    Question. Please provide a staffing breakout (including 
contractors) at headquarters and at each of the regional offices as of 
the end of each fiscal year (2001-2006) as well as a current breakout 
as of the latest pay period. Provide staffing levels by appointment, 
grade, and position.
    Answer. Attachment 5 lists on-board staffing, including 
contractors, at headquarters and each regional office at the end of 
each fiscal year, and the current staffing, including appointment, 
grade and position.

          ATTACHMENT 5.--ECONOMIC DEVELOPMENT ADMINISTRATION STAFFING CHART AS OF 3/20/2007--EMPLOYEES
----------------------------------------------------------------------------------------------------------------
               Office                                  Positions                       Appointment       Grade
----------------------------------------------------------------------------------------------------------------
Office of the Assistant Secretary...  Assistant Secretary........................  Political.........    ( \1\ )
Office of the Assistant Secretary...  DAS for Economic Development...............  Political.........    ( \2\ )
Office of the Assistant Secretary...  Senior Advisor to Assistant Secretary......  Political.........    ( \2\ )
Office of the Assistant Secretary...  Special Advisor............................  Political.........         11
Office of the Assistant Secretary...  Confidential Assistant.....................  Political.........         11
Office of the Assistant Secretary...  Secretary..................................  Career............         10
Office of Chief Counsel.............  Chief Counsel..............................  Career............         15
Office of Chief Counsel.............  Attorney Advisor...........................  Career............         14
Office of Chief Counsel.............  Attorney Advisor...........................  Career............         14
Office of Chief Counsel.............  Paralegal..................................  Career............         12
Office of Chief Counsel.............  Administrative Assistant...................  Career............          8
Office of Management Services.......  CFO/DAS for Management Services............  Career............    ( \2\ )
Office of Management Services.......  Secretary..................................  Career............          8
Office of Management Services.......  Program Analyst--PMF.......................  Career............         12
Office of Management Services.......  Deputy CFO/Director Administration &         Career............         15
                                       Support Svs Div.
Office of Management Services.......  Human Resources............................  Career............         15
Office of Management Services.......  Management Analyst.........................  Career............         14
Office of Management Services.......  Management Analyst.........................  Career............         13
Office of Management Services.......  Management Analyst.........................  Career............         13
Office of Management Services.......  Financial Analyst..........................  Career............         14
Office of Management Services.......  Accountant.................................  Career............         14
Office of Management Services.......  Accountant.................................  Career............         13
Office of Management Services.......  Director, Budgeting & Performance            Career............         15
                                       Evaluation Division.
Office of Management Services.......  Senior Program Analyst.....................  Career............         14
Office of Management Services.......  Program Analyst............................  Career............         13
Office of Management Services.......  Program Analyst............................  Career............         13
Office of Management Services.......  Program Analyst............................  Career............          7
Office of Management Services.......  Grant Specialist--PMF......................  Career............         11
Office of Management Services.......  Budget Analyst.............................  Career............         13
Office of Information Technology....  Chief Information Officer..................  Career............         15
Office of Information Technology....  Information Tech Specialist................  Career............         14
Office of Information Technology....  Information Tech Specialist................  Career............         13
Office of Information Technology....  Information Tech Specialist................  Career............         11
Office of Information Technology....  Information Tech Specialist................  Career............          7
Office of External Affairs and        DAS for External Affairs and Communications  Political.........    ( \2\ )
 Communications.
Office of External Affairs and        Secretary..................................  Career............          8
 Communications.
Office of External Affairs and        Director, Public Affairs...................  Political.........         15
 Communications.
Office of External Affairs and        Web Master.................................  Career............         13
 Communications.
Office of External Affairs and        Senior Public Affairs Specialist...........  Career............         13
 Communications.
Office of External Affairs and        Public Affairs Specialist..................  Career............         12
 Communications.
Office of External Affairs and        Prog Comm Specialist Team Leader...........  Career............         15
 Communications.
Office of External Affairs and        Management Analyst.........................  Career............         13
 Communications.
Office of External Affairs and        Intergovernmental Affairs Specialist.......  Career............         13
 Communications.
Office of External Affairs and        Investment Information Specialist..........  Career............         12
 Communications.
Office of External Affairs and        Comm & Cong Liaison Spec...................  Career............         12
 Communications.
Office of External Affairs and        Investment Information Specialist..........  Career............         12
 Communications.
Office of External Affairs and        Program Communications Asst................  Career............          7
 Communications.
Atlanta Regional Office.............  Regional Director..........................  Career............    ( \2\ )
Atlanta Regional Office.............  EDR/Kentucky...............................  Career............         13
Atlanta Regional Office.............  EDR/Mississippi............................  Career............         13
Atlanta Regional Office.............  Administrative Officer.....................  Career............         12
Atlanta Regional Office.............  Econ Dev Prog Spec.........................  Career............         12
Atlanta Regional Office.............  Econ Dev Prog Spec.........................  Career............         12
Atlanta Regional Office.............  Econ Dev Assistant.........................  Career............          6
Atlanta Regional Office.............  Civil Engineer.............................  Career............         14
Atlanta Regional Office.............  Civil Engineer.............................  Career............         13
Atlanta Regional Office.............  IT Specialist..............................  Career............         12
Atlanta Regional Office.............  Project Manager............................  Career............         12
Atlanta Regional Office.............  Chief, Public Works & Econ Adjust..........  Career............         14
Atlanta Regional Office.............  Program Specialist.........................  Career............         12
Atlanta Regional Office.............  Program Specialist.........................  Career............         12
Atlanta Regional Office.............  Program Specialist.........................  Career............         12
Atlanta Regional Office.............  Econ Dev Prog Spec.........................  Career............         11
Atlanta Regional Office.............  Regional Counsel...........................  Career............         15
Atlanta Regional Office.............  Econ Dev Prog Spec.........................  Career............         12
Atlanta Regional Office.............  Secretary O/A..............................  Career............          6
Austin Regional Office..............  Regional Director..........................  Career............    ( \2\ )
Austin Regional Office..............  Regional Counsel...........................  Career............         15
Austin Regional Office..............  Environmental Specialist...................  Career............         13
Austin Regional Office..............  Area Director..............................  Career............         14
Austin Regional Office..............  EDR/Louisiana..............................  Career............         13
Austin Regional Office..............  Senior Program Specialist..................  Career............         13
Austin Regional Office..............  Econ Dev Prog Specialist...................  Career............         12
Austin Regional Office..............  Mgmt Analyst...............................  Career............         12
Austin Regional Office..............  Area Director..............................  Career............         14
Austin Regional Office..............  Civil Engineer.............................  Career............         13
Austin Regional Office..............  Civil Engineer.............................  Career............         13
Austin Regional Office..............  OPCS Officer...............................  Career............         12
Austin Regional Office..............  Office Tech/Office Auto....................  Career............          5
Austin Regional Office..............  Area Director..............................  Career............         14
Austin Regional Office..............  EDR--Arkansas..............................  Career............         13
Austin Regional Office..............  Econ Dev Prog Specialist...................  Career............         12
Austin Regional Office..............  Econ Dev Prog Specialist...................  Career............         12
Austin Regional Office..............  Econ Dev Prog Specialist...................  Career............         12
Chicago Regional Office.............  Regional Director..........................  Career............    ( \2\ )
Chicago Regional Office.............  Regional Counsel...........................  Career............         15
Chicago Regional Office.............  EDR/Ohio/Indiana...........................  Career............         13
Chicago Regional Office.............  EEO Specialist.............................  Career............         13
Chicago Regional Office.............  Econ Dev Prog Specialist...................  Career............          9
Chicago Regional Office.............  Supv Program Specialist....................  Career............         14
Chicago Regional Office.............  Engineer...................................  Career............         13
Chicago Regional Office.............  EA Program Specialist......................  Career............         12
Chicago Regional Office.............  PW Program Specialist......................  Career............         12
Chicago Regional Office.............  PW Program Specialist......................  Career............         12
Chicago Regional Office.............  Supervisory Econ Dev Prog Spec.............  Career............         14
Chicago Regional Office.............  Engineer...................................  Career............         13
Chicago Regional Office.............  EA Program Specialist......................  Career............         12
Chicago Regional Office.............  OPCS Officer...............................  Career............         14
Chicago Regional Office.............  Administrative Officer.....................  Career............         12
Chicago Regional Office.............  Secretary..................................  Career............          6
Chicago Regional Office.............  Secretary..................................  Career............          6
Chicago Regional Office.............  Coordinator................................  Career............         14
Denver Regional Office..............  Regional Director..........................  Career............    ( \2\ )
Denver Regional Office..............  Regional Counsel...........................  Career............         15
Denver Regional Office..............  Civil Engineer.............................  Career............         13
Denver Regional Office..............  OPCS Officer/Computer Spec.................  Career............         12
Denver Regional Office..............  Admin Officer..............................  Career............         12
Denver Regional Office..............  Program Specialist.........................  Career............         12
Denver Regional Office..............  Program Specialist.........................  Career............         11
Denver Regional Office..............  Community Planner..........................  Career............         13
Denver Regional Office..............  East Team Leader...........................  Career............         14
Denver Regional Office..............  Program Specialist.........................  Career............         13
Denver Regional Office..............  EDR Colorado/Kansas........................  Career............         13
Denver Regional Office..............  EDR Iowa/Nebraska..........................  Career............         13
Denver Regional Office..............  EDR Montana/Utah...........................  Career............         13
Denver Regional Office..............  West Team Leader...........................  Career............         14
Denver Regional Office..............  Program Specialist.........................  Career............         13
Philadelphia Regional Office........  Regional Counsel...........................  Career............         15
Philadelphia Regional Office........  Environmental Officer......................  Career............         13
Philadelphia Regional Office........  General Attorney...........................  Career............         14
Philadelphia Regional Office........  Administrative Officer.....................  Career............         12
Philadelphia Regional Office........  Adm Support Assistant......................  Career............          5
Philadelphia Regional Office........  EDR New York/VT............................  Career............         13
Philadelphia Regional Office........  Chief, Planning Technical Asst.............  Career............         14
Philadelphia Regional Office........  Community Planner..........................  Career............         13
Philadelphia Regional Office........  Community Planner..........................  Career............         12
Philadelphia Regional Office........  Community Planner..........................  Career............         12
Philadelphia Regional Office........  Chief, Pubic Works.........................  Career............         14
Philadelphia Regional Office........  Civil Engineer.............................  Career............         13
Philadelphia Regional Office........  Sr. Program Specialist.....................  Career............         13
Philadelphia Regional Office........  Civil Engineer.............................  Career............         13
Philadelphia Regional Office........  Civil Engineer.............................  Career............         13
Philadelphia Regional Office........  Public Works Program Spec..................  Career............         12
Philadelphia Regional Office........  Econ Dev Prog Spec.........................  Career............         12
Philadelphia Regional Office........  Program Specialist.........................  Career............          9
Philadelphia Regional Office........  Chief, Economic Adjustment.................  Career............         14
Philadelphia Regional Office........  Sr.Program Specialist (Financial Analyst)..  Career............         13
Philadelphia Regional Office........  Program Specialist.........................  Career............         13
Philadelphia Regional Office........  Program Specialist.........................  Career............         12
Seattle Regional Office.............  Regional Director..........................  Career............    ( \2\ )
Seattle Regional Office.............  Regional Counsel...........................  Career............         15
Seattle Regional Office.............  EEO/Civil Rights...........................  Career............         13
Seattle Regional Office.............  Administrative Officer.....................  Career............         12
Seattle Regional Office.............  Computer Specialist........................  Career............         11
Seattle Regional Office.............  EDR Alaska.................................  Career............         13
Seattle Regional Office.............  Economic Development Specialist............  Career............         11
Seattle Regional Office.............  Chief, Economic Adjustment.................  Career............         14
Seattle Regional Office.............  Economic Adjustment Specialist.............  Career............         12
Seattle Regional Office.............  EDR/Oregon, Northern Cal...................  Career............         14
Seattle Regional Office.............  EDR Pacific Islands........................  Career............         13
Seattle Regional Office.............  EDR/Idaho and Nevada.......................  Career............         13
Seattle Regional Office.............  EDR/Central, Bay, CA.......................  Career............         13
Seattle Regional Office.............  EDR/Southern California....................  Career............         13
Seattle Regional Office.............  EDR/Arizona................................  Career............         13
Seattle Regional Office.............  Supv Community Planner.....................  Career............         14
Seattle Regional Office.............  Civil Engineer.............................  Career............         13
Seattle Regional Office.............  Civil Engineer.............................  Career............         13
Seattle Regional Office.............  Civil Engineer.............................  Career............         13
Seattle Regional Office.............  Public Works Specialist....................  Career............         12
Seattle Regional Office.............  Public Works Specialist....................  Career............         12
Seattle Regional Office.............  Public Works Specialist....................  Career............         12
                                                                                                      ----------
      Total.........................  ...........................................  ..................        161
----------------------------------------------------------------------------------------------------------------
\1\ EX.
\2\ SES.


         ATTACHMENT 5.--ECONOMIC DEVELOPMENT ADMINISTRATION STAFFING CHART AS OF 3/20/2007--CONTRACTORS
----------------------------------------------------------------------------------------------------------------
               Office                              Positions                       Funded by             Number
----------------------------------------------------------------------------------------------------------------
Office of Management Services.......  Accounting Technician.............  S&E........................          2
Office of Management Services.......  Human Resources \1\...............  S&E........................          2
Office of Information Technology....  Information Technology............  S&E........................          7
                                                                                                      ----------
      Total contractors funded by     ..................................  ...........................         11
       S&E funds.
                                                                                                      ==========
Contractors Funded by Other Sources
 of Funds:
    Seattle Regional Office.........  Community Planner.................  DOD Reimb Funds............          1
    Seattle Regional Office.........  Administrative Assistant..........  DOD Reimb Funds............          1
    Seattle Regional Office.........  Civil Engineer....................  DOD Reimb Funds............          1
    Seattle Regional Office.........  Program Specialist................  DOD Reimb Funds............          1
    Seattle Regional Office.........  Environ Protection Specialist.....  DOD Reimb Funds............          1
                                                                                                      ----------
      Total Other Fund Sources......  ..................................  ...........................          5
----------------------------------------------------------------------------------------------------------------
\1\ HR services previously provided under a cross-servicing agreement with ITA.

              esa headquarters staffing and funding levels
    Question. Please provide a staffing and funding breakout for ESA 
Headquarters for fiscal year 2005, fiscal year 2006, fiscal year 2007 
CR.
    Answer. All ESA headquarters' appropriated staffing and funding are 
identified in the Economics and Statistical Analysis budget under the 
``Policy Support'' heading.

----------------------------------------------------------------------------------------------------------------
                                                  Fiscal Year 2005      Fiscal Year 2006      Fiscal Year 2007
                                                       Actual                Actual                Enacted
               ESA Headquarters                -----------------------------------------------------------------
                                                Personnel    Amount   Personnel    Amount   Personnel    Amount
----------------------------------------------------------------------------------------------------------------
Positions/Budget Authority....................         34     $6,316         23     $3,975         23     $3,975
FTE/Obligations...............................         39      6,398         18      3,480    ( \1\ )    ( \1\ )
----------------------------------------------------------------------------------------------------------------
\1\ TBD.

                    dynamics of economic well-being
    Question. Will there be a gap in continuity between the start of 
the Dynamics of Economic Well-Being and the end of the SIPP? If so, how 
long?
    Answer. The Budget provides $15.9 million (an increase of $6.7 
million over the 2007 Budget) to continue the development of the new 
Dynamics of Economic Well-being System (DEWS). However, to ensure 
Census can focus its efforts and be successful at fielding the new 
survey in 2009, the Budget does not include funding to continue SIPP 
data collection in 2008. Therefore there will be a short ``data gap'' 
between ending the SIPP and beginning of DEWS.
    Data collection will end for SIPP in September 2007. We will have 
full data through May, partial data through August, and no data from 
September through December 2007. The first DEWS data collection will 
provide data for calendar year 2008. It should be noted that there have 
been gaps in the SIPP series before. For example, to enable the Census 
Bureau to initiate a new panel in February 2001 and process data more 
recently collected, data collected from February to September 2000 were 
never released and data from October 2000 to January 2001 were never 
collected. Based on those experiences and consultations with some of 
our Federal agency partners, we believe that a similar data gap between 
SIPP and DEWS should not hamper program evaluation or modeling.
                    improved measurement of services
    Question. Please provide the complete funding requirements for the 
``Improved Measurement of Services'' including any out-year 
requirements.
    Answer. The Improved Measurement of Services initiative request for 
fiscal year 2008 is $8,118,000. We expect that a similar amount will be 
needed in the out-years, with adjustments for inflationary cost 
increases and other technical adjustments to base, providing for the 
continued quarterly and annual collection and dissemination of service 
industry data.
                        ita export fee increase
    Question. The budget request proposes to double a fee that the 
Subcommittee has rejected the last two years. Will the fee increase be 
a disincentive for exports at the very time we are trying to encourage 
them?
    Please provide a schedule of current fees vs. those proposed under 
the request.
    Answer. In 2006, ITA was involved with over 12,000 export success 
stories. Overall, exports from the United States are up over 2005. In 
fiscal year 2006, ITA assumed that it would collect $8 million in fees. 
ITA actually collected $7.9 million. We believe these fees could be 
managed better to free-up funding for ITA activities that provide the 
greatest benefit to the nation as a whole. ITA believes its services 
are important for potential exporters and will continue to contribute 
to the export boom.
    ITA is working toward developing a fee setting strategy that will 
recover a slightly larger share of costs from companies that can afford 
it, while still encouraging SMEs to participate in the export market. 
The proposed fees will cover approximately 5 percent of the costs of 
the U.S. and Foreign Commercial Service (an increase from 3 percent in 
fiscal year 2007), and only about 3 percent of ITA's overall costs. The 
fees are targeted at services that provide benefits for specific firms, 
such as International Partner Searches, and Gold Key services. These 
services are most similar to those provided by private consulting 
firms.
    In addition, ITA is developing novel partnerships with companies 
such as FED-Ex and E-BAY, to name a couple, to expand the number of 
SMEs that export and those that export to more the one country. For 
example, FedEx is helping ITA to identify and inform U.S. exporters to 
Mexico about new business opportunities in Central America, which have 
come about as a result of recent Free Trade Agreements that the United 
States has signed with these countries. These private sector partners 
join ITA's traditional interagency partners, such as SBA, the Export-
Import Bank, the Overseas Private Investment Corporation, and state and 
local governments in an effort to educate, inform and assist companies. 
These partnerships help achieve the government's and the private 
partners' goals of expanding foreign sales.
    Below is a schedule of current fees. There are no proposed fees at 
this time.

------------------------------------------------------------------------
                                                    Current Fees
------------------------------------------------------------------------
                 Products

Business Facilitation Service.............  Variable depending on
                                             company requirements
BuyUSA.gov Business Service Provider......  International $150-$500
                                            Domestic $250
                                            Free for U.S. Companies
Commercial News USA.......................  Revenue comes from
                                             advertising
Customized Market Research................  Variable depending on
                                             company requirements
Featured US Exporters (FUSE)..............  $25-50
Gold Key--1st day.........................  $685-$770 \1\
Gold Key--each additional day.............  $320-$385 \1\
International Company Profile (ICP).......  $520-$810 \1\
International Partner Search (IPS)........  $500-$790 \1\
Platinum Key Service......................  Variable depending on
                                             company requirements

                  Events

Catalog Event/PLC.........................  $450 and $650
Certified Trade Mission...................  Variable depending on
                                             company requirements
International Buyer Program...............  $8,000
Seminar-Webinar...........................  Variable
Trade Fair................................  Variable depending on trade
                                             fair expenses and company
                                             requirements
Trade Mission.............................  Variable depending on
                                             company requirements
Trade Promotion Event.....................  Variable depending on
                                             company requirements
Single Company Promotion..................  Variable depending on
                                             company requirements
Certified Trade Fairs.....................  $1,750
------------------------------------------------------------------------
\1\ The range of user fees charged for certain services reflects
  variations in the cost of doing business in different markets.

                      ita chinese subsidy programs
    Question. Please provide a funding summary of efforts to identify 
and analyze Chinese subsidy programs.
    Answer. While ITA records maintain cost information for overall 
China enforcement efforts, it does not record separately its activities 
with respect to China subsidies for financial purposes. We can 
reasonably estimate that, between efforts in Washington, DC, and ITA's 
foreign offices in Asia, particularly Beijing, ITA devoted well over 
$1,000,000 to research, monitoring, consultation and advocacy regarding 
China subsidy issues during fiscal year 2006. During fiscal year 2007, 
we estimate that this amount could reach somewhere in the range of 
$1,500,000.
                     ita assistant secretary status
    Question. What is the status of the A/S for Manufacturing vacancy?
    Answer. We are working closely with Personnel at the White House on 
this appointment and are making good progress. We are committed to 
filling this position as quickly as possible.
                  funding for noaa education programs
    Question. Secretary Gutierrez, a few weeks ago you invited me to 
attend an event at a local Maryland high school to visit with students 
participating in the FIRST Robotics competition. From the interest you 
have shown in this program I know that you are keenly aware of the fact 
that we need to engage our young people I math and science programs.
    What is the rationale for cutting the NOAA education programs by 50 
percent?
    Does the Department of Commerce believe in the NOAA education 
mission?
    Answer. NOAA's fiscal year 2008 budget maintains NOAA's education 
spending at the fiscal year 2007 President's request level. The 
Department of Commerce strongly believes in NOAA's educational mission 
and we believe that NOAA can make considerable progress toward its goal 
of developing an ocean literate population at the requested funding 
level. In order to produce a society well versed in ocean-related 
issues, it is vital that NOAA establishes a strong foundation of 
knowledgeable students who will later move into the general population. 
The programs included in the fiscal year 2008 budget (see Table 1) all 
contribute to this goal.

  TABLE 1.--EDUCATION PROGRAMS INCLUDED IN PRESIDENT'S FISCAL YEAR 2008
                             BUDGET REQUEST
------------------------------------------------------------------------
                                                            Fiscal Year
                                                               2008
                         Program                            President's
                                                              Request
------------------------------------------------------------------------
Educational Partnership Program.........................     $14,261,000
Hollings Scholarship....................................       3,700,000
JASON...................................................       1,000,000
Nancy Foster Scholarship................................         400,000
                                                         ---------------
      Total.............................................      19,361,000
------------------------------------------------------------------------

    Examples of each of these successful NOAA programs are highlighted 
below:
    The JASON Project uses multimedia tools and cutting-edge technology 
to engage middle-school students in scientific research and expeditions 
led by leading scientists. Dr. Bob Ballard has transmitted his 
discoveries to millions of students in classrooms around the country, 
via satellite and internet broadcasts. The JASON Project also provides 
on-site and on-line teacher professional development supported by the 
National Science Teachers Association and the U.S. Department of 
Education's Star Schools Program.
    NOAA's Educational Partnership Program began in 2001 and provides 
financial assistance, on a competitive basis, to Minority Serving 
Institutions (MSIs) to increase programs and opportunities for students 
to be trained and graduate in sciences that directly support NOAA's 
mission. The program consists of four core components: Cooperative 
Science Centers, Environmental Entrepreneurship Program, Graduate 
Sciences Program and the Undergraduate Scholarship Program.
  --Five Cooperative Science Centers have been designated at MSIs with 
        graduate degree programs in NOAA-related sciences. To date, 
        NOAA has provided formal training and research opportunities 
        for 2,050 students at these centers. External teams of 
        scientists have reviewed the centers to determine the 
        effectiveness of student recruitment, training and graduation. 
        Program statistics have consistently exceeded performance 
        measures with over 383 students graduating with bachelors and 
        advanced degrees in NOAA-related sciences. Of those students, 
        33 have received Ph.D.'s and 105 students have been awarded 
        Masters Degrees. Another 94 Ph.D. candidates and 126 Masters 
        candidates are expected to receive advanced degrees within the 
        next three to five years.
  --The Environmental Entrepreneurship Program provides financial 
        assistance to increase the number of students at MSIs who are 
        proficient in both environmental studies and business 
        enterprises. The Program facilitates linkages between MSIs, 
        NOAA and the private sector.
  --The Undergraduate Scholarship Program has trained 84 students 
        majoring in NOAA-related sciences at MSIs. Of these, 69 
        students have completed the program and 15 are finishing their 
        second year of training. Twenty-eight of the students that have 
        completed the program have been accepted into graduate 
        programs.
  --The Graduate Sciences Program offers training and work experience 
        to exceptional female and minority students pursuing advanced 
        degrees in the environmental sciences. After completing the 
        program, participants commit to employment at NOAA based upon 
        the length of their training. To date, the Graduate Sciences 
        program has hired 32 graduates as NOAA scientists.
    The Dr. Nancy Foster Scholarship Program, named in honor of the 
late distinguished NOAA scientist and Assistant Administrator, 
recognizes outstanding scholarship and encourages independent graduate 
level research--particularly by female and minority students--in 
oceanography, marine biology and maritime archaeology. Congress 
authorized the Program, as described in the National Marine Sanctuaries 
Amendments Act of 2000, soon after Dr. Foster's death in June 2000, as 
a means of honoring her life's work and contribution to the Nation. To 
date, 22 students have received scholarships, 18 of whom are women.
    The Ernest F. Hollings Scholars Program recruits and prepares 
students for public service careers with NOAA and other natural 
resource and science agencies as well as for careers as teachers and 
educators in oceanic and atmospheric science. Last year, the first 
Hollings Scholars successfully participated in summer internships with 
NOAA labs and facilities. The Hollings Scholarship Program currently 
funds more than 100 students in ocean and atmospheric sciences, math, 
computer science, social science and education.
    As indicated above, the Department supports education programs at 
NOAA and is requesting over $19 million in fiscal year 2008 for 
education programs and activities.
                    united states pto patent backlog
    Question. What is the current backlog of patents?
    Answer. The backlog (cases that have not been examined) of patent 
applications at the beginning of fiscal year 2007 was 701,000. As noted 
in the 2007-2012 Strategic Plan, the rate at which patent applications 
are being filed has increased beyond the rate at which the USPTO is 
presently able to examine them. It is possible that this backlog could 
approach 1.4 million by 2012.
    We are currently employing the following strategies to address 
backlogs:
  --Enhance recruitment to hire 1,200 new patent examiners a year for 
        an extended period of time, including examiners with degrees 
        and/or experience in areas of emerging technologies.
  --Expand telework and explore establishing regional USPTO office.
  --Competitively source PCT Chapter 1 applications, freeing examiners 
        to focus on national cases.
  --Explore examination reform through the rule making process to 
        create better-focused examination and enhance information 
        exchange between applicant and examiner.
               long-term metric/goal for patent pendency
    Question. What is the agency's long-term metric/goal for patent 
pendency?
    Answer. Our long-term, strategic goal for patent pendency \1\ is 28 
months to final disposition, by 2012.
---------------------------------------------------------------------------
    \1\ Patent pendency is the amount of time a patent application is 
waiting (in queue) before a patent is issued or the application is 
abandoned.
---------------------------------------------------------------------------
    Metrics include reduction of the initial waiting time for patent 
applications in our most backlogged Technology Centers and successful 
implementation of various initiatives that ensure goal achievement by 
2012.
    The USPTO is both implementing initiatives and exploring strategies 
that will reduce the backlog of unexamined patent applications and 
improve the timeliness of a patent examination.
    An important set of options--important because they would have a 
significant, long-lasting positive effect on timeliness of patent 
examination--might require legislation. Therefore, we are grateful to 
the Subcommittee for its interest in the topic of patent pendency, as 
we believe faster processing of patent applications is crucial to 
America's Competitiveness.
                             retention rate
    Question. What is the current staff retention rate?
    Answer. The USPTO typically reports an attrition rate rather than a 
retention rate. In 2006 the USPTO's examining staff had an attrition 
rate of 10.6 percent. In contrast, the U.S. Department of Labor, Bureau 
of Labor Statistics reported a total government separation rate of 16.9 
percent for 2006.
                      increase examiner retention
    Question. Beyond recruitment and retention bonuses, how is PTO 
working to increase examiner retention?
    Answer. In addition to providing eligible examiners a market-driven 
recruitment bonus for up to four years with a condition of employment 
agreement, the USPTO has identified a number of initiatives that would 
improve retention:
  --The Office is forming teams of hiring coordinators with specialized 
        technology-specific and human resources and recruiting skills 
        to attract candidates for hard to fill examining positions, 
        particularly those most likely to stay at the USPTO.
  --Another way of attracting candidates who most likely would remain 
        at the USPTO is to use personal interaction at college and 
        regional job fairs to educate candidates about the exact nature 
        of the job.
  --The on-going Patent Hoteling Program (PHP), which was launched in 
        2006 with 500 examiners, will be expanded by 500 examiners a 
        year through fiscal year 2010.
      --PH is a voluntary program whereby participants can remotely 
            access USPTO automated system, on-line resources, and other 
            information from an alternative worksite. They also can 
            remotely reserve office space one day per week in a ``hotel 
            office suite'' located at USPTO headquarters to conduct in-
            person business activities.
  --On a more long-term basis, we hope to create, with Congressional 
        support and legislative authority, a workplace that can be 
        anywhere. In this regard, three possibilities are being 
        investigated by Patents: (1) expanding the successful Patents 
        Hoteling Program (PHP) in such a way as to create a more 
        nationwide workforce; (2) creating remote or regional offices, 
        or brick and mortar presences, in different locations across 
        the country selected upon a variety of factors such as where 
        pockets of technology may be concentrated or there is increased 
        access to a suitable workforce for hire; and (3) a storefront 
        approach which in a sense is a hybrid of the possibilities (1) 
        and (2). The storefront approach would potentially provide a 
        small-scale brick and mortar presence, or node, which could 
        then act as a support center for employees participating in an 
        expanded hoteling program.
  --The USPTO plans a multi-pronged approach to provide enhanced 
        training programs for patent employees--both new employees and 
        mid-career and senior examiners.
  --The Office also plans to develop alternatives to the current 
        performance and bonus systems, for example, the Patent Flat 
        Goal pilot program, which is designed to improve flexibility as 
        to when and where examiners perform their work.
  --Patent examiners received a 7 percent special pay rate increase in 
        November 2006.
  --In 2006, USPTO management submitted proposals to patent union 
        representatives for a new collective bargaining agreement that 
        would replace a previous agreement negotiated in 1986. 
        Proposals include enhanced patent examining monetary awards and 
        production activities, as well as a stand-alone quality award.
       timeline for achieving strategic plan goals and objectives
    Question. In December, PTO submitted its latest 5-year strategic 
plan to OMB. The plan lists four goals: Optimizing Patent Quality and 
Timeliness; Optimizing Trademark Quality and Timeliness; Improving 
Intellectual Property Protection; and Achieve Organizational 
Excellence.
    What is your timeline for achieving the goals and objectives of the 
plan?
    Answer. The 2007-2012 Strategic Plan proposes consideration of 
substantial changes for patents, trademarks, intellectual policy and 
management that will better position the USPTO and its users for future 
growth and complexity. The Plan also documents our belief that 
partnership with stakeholders is crucial to defining, in a 
collaborative manner, solutions that will benefit the entire IP system.
    The Strategic Plan specifically identifies and describes more than 
60 initiatives for achieving the goals and objectives in the Strategic 
Plan. Some of these initiatives already are under way or have specific 
timeframes, while others commit us to continue researching and 
exploring options to solve specific problems.
  --For example, one alternative that is under way is the Patent Flat 
        Goal pilot program. This pilot is designed to improve 
        flexibility as to when and where examiners perform their work.
  --Another example is the initiative to competitively source Patent 
        Cooperation Treaty (PCT) Chapter I applications. As an 
        International Searching Authority under the PCT, the USPTO is 
        obligated to perform this search function. By competitively 
        sourcing this function, the USPTO will redirect patent examiner 
        resources back to the examination of U.S. applications. Two 
        contracts were awarded last fiscal year to initiate this 
        program. In addition, the USPTO entered into agreements with IP 
        Australia to perform search and examination work on PCT 
        applications. Initially, the USPTO expects to competitively 
        source up to 15,000 Chapter I applications.
  --In addition, we have identified a broad objective to explore the 
        development of alternative approaches to patent examination in 
        collaboration with stakeholders.
  --The USPTO is planning a pilot program for peer review of patent 
        applications. Up to 250 applicants whose applications are in 
        the computer architecture, software and information security 
        technologies will be able to voluntarily place their 
        applications on a non-USPTO web site for public review by a 
        peer group of patent users, attorneys and academics. This peer 
        group will determine and submit to the USPTO what they consider 
        the best available and relevant prior art. The pilot will test 
        whether this peer review can effectively identify prior art 
        that might not otherwise be found by our examiners during the 
        typical examination process. We will also make an evaluation as 
        to whether this process results in measurable examination 
        timesaving and quality improvement.
  --We also are developing a plan to reach out to the entire patent 
        community to ensure their ideas are adequately represented and 
        considered. The Patent Public Advisory Committee (PPAC) would 
        assist in this process by gathering information and making 
        recommendations to improve the patent system to the USPTO. A 
        proposed process has been developed for gathering input and 
        proposals for improving the patent examination system by 
        bringing together the diverse external patent community to 
        identify patent examination products or services that may 
        result in the more efficient use of examination resources. The 
        process would strive to identify a wide range of ideas from 
        those needing statutory changes to those that can be 
        implemented immediately under our existing authorities.
  --The USPTO is developing and reviewing a variety of innovative 
        patent processing initiatives including a new offering for the 
        public called ``Accelerated Examination.'' Under this program, 
        which began August 26, 2006, for those applicants who need or 
        want quick turn around, the USPTO offers a complete examination 
        within 12 months. In exchange for this quick turn around, 
        applicants must file a complete application, agree to 
        interviews and accelerated response periods, must file and 
        prosecute their application electronically and must provide 
        more information about the application to the USPTO in the form 
        of an examination support document. The first application to be 
        completed under this program was filed on September 29, 2006 
        and issued on March 13, 2007 (less than 6 months from date of 
        filing).
  --We believe that to effectively address and control pendency and 
        reduce backlog, the USPTO needs to receive more and better 
        focused information from applicants themselves and from the 
        public at large. The USPTO has proposed and will propose 
        regulations and administrative changes governing submission of 
        patent applications that will enable our examiners to make more 
        efficient and informed determinations.
  --First, we have proposed limiting the number of continuing 
        applications and continued examination requests to provide an 
        incentive for applicants to focus their initial patent 
        applications on their inventive contributions.
  --Second, we have proposed to limit the number of claims that are 
        initially examined in order to provide an incentive to focus 
        the examination process.
  --The first and second proposals have optional procedures which 
        continue to provide an applicant flexibility where the 
        applicant may need additional continuing applications or 
        initially examined claims upon a showing of that need or by 
        shouldering additional responsibilities. In parallel we have 
        proposed revisions to our information disclosure requirements 
        to focus our limited examination recourses on prior art that is 
        most relevant to the examination process. Additionally we are 
        considering a new practice change to require applicants to 
        conduct a pre-examination search and provide an explanation as 
        to why they believe that they are entitled to a patent in view 
        of the information discovered during the pre-examination 
        search.
  --Our hope is to achieve examination reform that creates better-
        focused examination and enhances information exchange between 
        applicant and examiner. We look forward to working with the 
        public and Congress to develop an enhanced examination system 
        that effectively and fairly balances the needs of the Office 
        and the interests of the patent applicants, interested third 
        parties and the general public.
  --While the USPTO currently has a procedure for submission of prior 
        art after publication, which allows submission by third parties 
        within two months of publication, the procedure does not allow 
        explanations or other information about the patents or 
        publications absent express written consent of the applicant. 
        We encourage consideration of a change to the statute governing 
        this procedure to allow filing of relevant information by third 
        parties after pre-grant publication. Such a change would allow 
        those interested parties to explain why the prior art would 
        have a negative impact on the patentability of the claims. This 
        process, which would provide the examiner with information he 
        or she might not otherwise obtain, should result in a more 
        efficient examination process and a higher quality, more 
        reliable patent. Putting the best and most complete information 
        before our examiners, as early in the examination process as 
        possible, is beneficial to the legitimate interests of all 
        interested parties and stakeholders.
  --We look forward to working with Congress to develop a submission 
        procedure that effectively and fairly balances the interests of 
        the patent applicant, interested third parties and the general 
        public.
  --We are also looking to provide assistance to the open source 
        community in their development of an open source database to 
        provide examiners with potential prior art.
  --Trademarks expects to achieve 3-month first action pendency by 2008 
        and maintain it thereafter. Trademarks also expects to reduce 
        disposal pendency to 16 months by 2009 and maintain it. Our 
        challenge will be to maintain performance goals given the 
        uncertainties of filings and funding. The Strategic Plan 
        addresses improvements in the criteria used to define quality 
        as well as expanding quality assessments throughout the office.
    In conclusion, we consider the Strategic Plan to be a work in 
progress, and we will refine and update it regularly to adjust to 
changing conditions and to incorporate the best thinking of the 
intellectual property community and beyond. Our budget and performance 
plan that is submitted to the Congress each year will document key 
measurements and yearly milestones to justify full funding for the 
Office in achieving our strategic goals.
                       patent examination quality
    Question. How does the PTO measure patent examination quality?
    Answer. Quality begins with the fundamentals--a high-performing 
workforce that is properly trained and given the tools and information 
technology systems needed to accomplish the job. Furthermore, the USPTO 
monitors quality quite precisely by measuring:
  --In-process compliance with published statutory, regulatory, and 
        practice standards;
  --End-of-process compliance with these same standards.
    These parameters are measured by performing a review of 
statistically significant random samplings of examiners' work products.
    Since we put additional quality initiatives in place in 2003, our 
compliance rates have increased.
    In fiscal year 2006, we achieved a 96.5 percent patent allowance 
compliance \2\ rate the highest in 25 years, while receiving a 
historically high number of patent applications (419,760).
---------------------------------------------------------------------------
    \2\ Compliance rate is the percentage of applications allowed by 
patent examiners with no errors after being reviewed by the Office of 
Patent Quality Assurance.
---------------------------------------------------------------------------
              work with user community to evaluate quality
    Question. Is the PTO working with the user community to evaluate 
whether the right measures are being used to evaluate quality?
    Answer. As part of the 2007-2012 Strategic Plan, we will continue 
to work with all interested parties to find new ways to improve and 
measure quality even more effectively.
    The USPTO plans to keep developing appropriate measures of patent 
quality and related performance targets given the current patent 
examination system. We will engage the patent community about 
developing objective review criteria that can be applied in all review 
processes. By doing this, we will create more consistent and credible 
measurements of quality.
      technology administration staffing and unobligated balances
    Question. Please provide the current on-board staffing levels for 
TA.
    Answer. As of March 14, 2007, the on-board staffing levels for TA 
are 7 consisting of 6 full-time permanent employees and 1 excepted 
service employee.
    Question. Please provide the fiscal year 2006 end-of-year 
unobligated balance for TA.
    Answer. The fiscal year 2006 end-of-year unobligated balance for TA 
was $443,000.
                           mep funding levels
    Question. Please provide the analysis behind the $46.3 million 
funding level request for the MEP?
    Answer. We believe that the proposed budget would achieve these 
specific Federal objectives:
  --Ensure that MEP continues to develop and provide all the centers 
        up-to-date skills and techniques;
  --Ensure standards of quality are met and maintained at every center 
        receiving Federal funding; and
  --Ensure that centers focus on offering services to the small 
        manufacturers in their areas, rather than large firms.
    In a tight budget environment, we need to ensure that we are 
funding the highest priority programs. The President's request for the 
National Institute of Standards and Technology (NIST) will ensure that 
funding goes to basic research--especially in the areas of physical 
sciences, engineering, computing, and nanotechnology--that is vital to 
the Nation's innovation enterprise and manufacturing. NIST meets these 
priorities by focusing on high impact research and investing in the 
capacity of NIST's user facilities and labs. This emphasis is validated 
by the high rate of return to the Nation that the NIST labs already 
have demonstrated. Nineteen retrospective studies of economic impact 
show that, on average, NIST labs generated a benefit-to-cost ratio of 
44:1 to the U.S. economy. The high rate of return results from the fact 
that new measurements or standards benefit entire industries or sectors 
of the economy--as opposed to individual companies. The MEP program is 
just one method by which NIST supports small manufacturers. NIST 
laboratory activities are geared to enhancing the Nation's 
manufacturing base, provide more of a true public good, and are a 
better use of scarce Federal funding.
    The fiscal year 2008 budget request would encourage MEP Centers to 
be more efficient by reducing their overhead costs, including marketing 
costs. Given the benefits reported by MEP clients, centers could also 
ask MEP clients to cover more of the cost of the services through 
increased fees.
    Question. How would NIST implement the program at $46.3 million?
    Answer. The MEP Director will work with the centers to develop 
options that consider each center's customer base, constraints, and 
opportunities. Actions taken by any center or group of centers will be 
assessed against their ability to maintain support to the small 
manufacturers. MEP will work with the centers to examine alternatives 
and optimize the best plan for operating at the $46.3 million level 
that ensures the maximum benefit to small manufacturers.
                     ntia's appropriation language
    Question. Please provide a brief summary of the status of each of 
the mandatory spending programs funded through the Digital Television 
Transition and Public Safety Fund.
    Answer. The Deficit Reduction Act of 2005, Public Law 109-171, 
(Act) provides borrowing authority for four programs that are the 
current focus of the Department of Commerce's National 
Telecommunications and Information Administration (NTIA).
Digital-to-Analog Converter Box Program (Sec. 3005 of the Act)
    Congress directed NTIA to implement and administer a program 
through which eligible U.S. households may obtain up to two coupons of 
$40 each to be applied towards the purchase of digital-to-analog 
television converters. NTIA issued its Final Rule to implement the 
Coupon Program on March 9, 2007. The rule, which is available on NTIA's 
website at www.ntia.doc.gov, describes how consumers may obtain and use 
coupons, outlines retailer participation, and provides detailed 
specifications for manufacturers who wish to produce converters to be 
eligible for purchase with coupons.
    NTIA held a public meeting on March 19 to review the Final Rule in 
detail and to answer any questions. The meeting was the first of 
several periodic meetings NTIA will hold to communicate with the public 
and leverage a wide range of private sector, nonprofit, and 
governmental partners in disseminating information about the Coupon 
Program and the digital transition.
    NTIA intends to enter into a contract for services to administer 
the Coupon Program through a separate program acquisition. On July 31, 
2006, NTIA issued a Request for Information to initiate market research 
for the contract. Interested vendors attended an Industry Day on August 
11, 2006, and submitted information to NTIA on September 15, 2006. NTIA 
released the Request for Proposals (``RFP'') on March 13, 2007. NTIA 
held a Bidder's Conference on March 26, 2007. Offerors will respond to 
this RFP by April 30, 2007. The procurement schedule anticipates that a 
contract will be awarded by August/September 2007 and the period of 
performance will start some months later.
    The voluntary participation of consumer electronics retailers and 
manufacturers is crucial to the success of the Coupon Program. Business 
considerations, however, will ultimately guide the retailers and 
manufacturers in deciding whether they will produce and market 
converter boxes through the Coupon Program. NTIA, through its rules and 
administration of the program, is making every effort to encourage 
participation and support from these industries.
    NTIA has taken suggestions from manufacturers and broadcasters to 
establish technical specifications for converters that will ensure the 
availability of low-cost, reliable converters based on today's state of 
the art technology. NTIA set minimum specifications and features for 
converters that are ``required'' but also identified features and 
specifications that are ``permitted.'' Pursuant to the statute, NTIA's 
Final Rule also provides examples of ``disqualifying'' features such as 
built-in DVD capability.
    NTIA has addressed retailers' concerns about a range of topics such 
as the timing of payments to reimburse them for coupon redemption, 
requirements for stocking and managing converter inventory, training 
requirements, and promotion and marketing of converters. NTIA's 
retailer certification program will minimize incidents of waste, fraud 
and abuse. Retailers will be part of the Federal Government's Central 
Contractor Registry (www.ccr.gov) and will agree to have electronic 
systems in place to track coupon redemption activity. NTIA will provide 
training materials for retailers and maintain lists of certified 
retailers.
    NTIA's consumer education efforts will succeed only with the help 
of the broadcasters, consumer electronics manufacturers and retailers, 
and several key consumer and public outreach organizations. NTIA is a 
key participant in the Digital Television Transition Coalition 
(www.dtvtransition.org) which was recently launched to ensure that no 
consumer is left without broadcast television due to a lack of 
information about the transition. NTIA will work with intermediary 
groups representing vulnerable populations--rural residents, 
economically disadvantaged, minorities and seniors--to get the word out 
through broadcast stations, newspapers, advertisements, the Internet 
and other outlets that serve these communities. NTIA will also work 
with other agencies, such as Food Stamps, SSI, and Veterans Affairs--as 
well as state, county and local associations--to reach consumers 
directly through mail stuffers alerting households to the Coupon 
Program.
Public Safety Interoperable Communications Grant Program (Sec. 3006 of 
        the Act)
    The Act establishes a $1 billion grant program to assist public 
safety agencies in the acquisition of, deployment of, or training for 
the use of interoperable communications systems that utilize, or enable 
interoperability with communications systems that can utilize, 
reallocated pubic safety spectrum in the 700 MHz band for radio 
communications. NTIA does not view this language to limit the grant 
funds only to 700 MHz systems investments. Rather, NTIA is committed to 
exploring the use of all available technologies to advance overall 
public safety interoperability, as long as those technologies will 
enable first responders to interoperate with the 700 MHz bands in the 
future. The Call Home Act of 2006 directs NTIA, in consultation with 
DHS, to award the grants no later than September 30, 2007.
    On February 16, 2007, the Department of Homeland Security (DHS) 
Office of Grants and Training and NTIA signed a Memorandum of 
Understanding (MOU) through which DHS will provide NTIA with grants 
administrative services to assist in the administration of the Public 
Safety Interoperability Communications (PSIC) Grant Program. The 
program schedule has been developed to meet the statutory requirements 
and deadlines as well as to create an effective PSIC Grant Program.
    The Program will make grants to eligible public safety agencies 
through the State Administrative Agencies in the 56 States and 
Territories. In mid-July 2007, PSIC grant awards will be made and 
jointly announced by NTIA and DHS, and the grant guidance, application 
kits, and eligibility requirements will be released. PSIC funds will be 
allocated using a modified version of the DHS risk methodology.
    Up to five percent of the total grant for each State and Territory 
will be disbursed to ensure that their Statewide Interoperable 
Communications Plans (Statewide Plans) include consideration of PSIC 
requirements. No later than November 2007, States and Territories will 
submit their final Statewide Plans and an investment justification 
outlining how the PSIC funds will be used to meet the PSIC requirements 
consistent with their Statewide Plans. Once the Statewide Plans, 
applications and investment justifications are reviewed and approved, 
the PSIC funds will be disbursed to States and Territories to pass 
through to eligible public safety agencies. Projects must be completed 
by September 30, 2010.
    The PSIC Grant Program will be designed to complement funds that 
have been awarded through other grant programs--such as the Homeland 
Security Grant Program and the Infrastructure Protection Program--that 
include interoperable communications funds. The program guidance and 
application process will emphasize leveraging grants, contracts or 
state/local budgets to build and sustain intrastate and interstate 
regional capabilities and identified needs.
New York City 911 Digital Transition (Sec. 3007of the Act)
    The Act directs NTIA to reimburse the Metropolitan Television 
Alliance (MTVA) up to $30 million for costs associated with the digital 
television transition. MTVA, a consortium of New York City area 
television stations, formed when the television stations' digital and 
analog transmission facilities were destroyed in the collapse of the 
North Tower of the World Trade Center. This funding will assist MTVA in 
the design and deployment of a temporary digital television broadcast 
system to ensure that, until a permanent facility atop the Freedom 
Tower is constructed, the stations can provide digital television 
service to the New York City area.
    NTIA has been working with MTVA since June 2006 in the preparation 
of an application for this funding and to ensure that MTVA will be able 
to comply with federal funding requirements. The application process 
has been completed and the grant was announced on March 21 2007. NTIA 
is awarding $7,855,000 for fiscal year 2007 to MTVA for the first phase 
of the project that will design and test the technology for a 
distributed transmission system at three of five sites in the New York 
City metropolitan area. Based on the results of these test sites, MTVA 
anticipates requesting $21,645,000 for reimbursement in fiscal year 
2008 to complete the full 20-site system in the New York City 
metropolitan area. This will ensure operation prior to the digital 
television transition deadline of February 17, 2009.
Low-Power Television and Translator Digital-to-Analog Conversion (Sec. 
        3008 of the Act)
    The Act establishes a $10 million program to compensate each low-
power television station for the purchase of digital-to-analog 
conversion equipment to enable the conversion of an incoming digital 
signal from its corresponding full-power television station to analog 
format for transmission on the low-power station's analog channel. 
Funds are to be made available to these organizations in fiscal year 
2008. Approximately 10,000 facilities are eligible for this support.
    NTIA plans to work closely with the low-power television and 
translator communities to ensure that this $10 million program 
effectively assists these communities as the February 2009 deadline 
approaches. NTIA is currently reviewing technical issues necessary to 
draft program guidance and application guidelines, which it expects to 
issue later this year.
                                 ______
                                 
            Questions Submitted by Senator Patrick J. Leahy
                ita western hemisphere travel initiative
    Question. I have serious reservations with the manner in which the 
Departments of Homeland Security (DHS) and State (State) have pushed 
forward with implementation of the Western Hemisphere Travel Initiative 
(WHTI) before the necessary technology installation, infrastructure 
upgrades, and training takes place at our border stations. If these 
critical features of the deployment are not in place, I am afraid we 
will see severe delays at our border and law-abiding citizens from the 
United States, Canada, and Mexico will have great difficulty moving 
between our countries. Most importantly, a hasty implementation without 
assurances that the technology to be used is truly effective will 
result in a less secure border.
    Since Canada is such an important trading partner and friendly 
neighbor to the United States, it clearly is in the best interest of 
both of our countries to keep those relations as positive and 
productive as possible. To that end, we all know that there is a 
dynamic relationship between commerce and security, and we constantly 
need to balance the two.
    Has your agency conducted or been asked to conduct any economic 
impact analysis for how WHTI is going to affect communities along our 
Northern Border?
    If not, could you please provide for the Subcommittee your best 
estimate as to the economic impact that the WHTI would have on (a) the 
states along the Northern Border, and (b) the U.S. economy?
    Answer. While Commerce has not conducted, nor has it been asked to 
conduct, an analysis of WHTI's regional or national economic impact, 
the following data is provided for consideration.
    Currently, Canadian and Mexican travel to the USA has a dramatic 
impact on the country. In 2006, Canada became the second largest market 
for U.S. travel exports ($13.5 billion). Canada is still the largest 
generator of arrivals to the United States, with 16 million visitors 
staying one night or longer.
    Mexico is the fourth largest travel export market for the United 
States ($9.2 billion), and the second largest visitor market for the 
USA, setting records for arrivals and travel exports in 2004-2006. 
Since 2000, Canada and Mexico have been the only countries to post 
increases in arrivals among the top six arrival markets for the 
country.
    Commerce is working with the Departments of Homeland Security and 
State and with the industry to try to minimize any negative impact WHTI 
may have in travel and tourism. For example, discussions have taken 
place on developing a pass card between the USA and Canada; the 
passport requirement was changed to exempt children under 16; and a 
communication effort was implemented by industry and DHS to inform 
travelers of the WHTI changes.
    As the U.S. Government moves into the second wave of implementation 
(land border and cruise), Commerce will work closely with the 
Department of Homeland Security to ensure clear communications with 
potential travelers. Travel flows between the countries will continue 
to be reported on a monthly basis by Commerce's Office of Travel and 
Tourism Industries.
                  western hemisphere travel initiative
    Question. I was troubled to learn that the DHS may have prematurely 
endorsed one PASS Card technology over another without first securing 
the required National Institute of Standards and Technology (NIST) 
certification of the card architecture and then notifying Congress. The 
law clearly states that the NIST must certify, prior to implementation, 
``that the Departments of Homeland Security and State have selected a 
card architecture that meets or exceeds International Organization for 
Standardization security standards and meets or exceeds best available 
practices for protection of personal identification documents.'' By 
unilaterally moving forward with vicinity-read technology, the DHS 
would be choosing an insecure technology that has not been proven 
effective at ensuring privacy protection, and it would be necessitating 
the installation of new technological infrastructure at every U.S. land 
and sea port of entry.
    Has NIST begun its analysis into the WHTI-related technology 
issues, as called for in the fiscal year 2007 Homeland Security 
Appropriations Bill?
    Answer. After passage of the statute (Public Law 109-295), NIST 
immediately began to work with the Departments of State and Homeland 
Security in order to identify appropriate standards and best available 
practices that relate to the security aspects of the card architecture, 
for the technology chosen jointly by State and DHS. NIST has engaged in 
extensive discussions with the technical staff of those departments, 
and has provided a set of requirements for certifying the security of 
the PASS Card architecture.
    Question. If so, when do you estimate the NIST will complete its 
analysis?
    Answer. NIST has advised State and DHS that certification would be 
done within four weeks of receiving the draft Request for Proposal 
(RFP) from State, and prior to the release of the final RFP. This is to 
ensure that the RFP accurately reflects the set of requirements 
identified by NIST so that the selected card architecture meets or 
exceeds International Organization for Standardization (ISO) security 
standards and meets or exceeds best available practices for protection 
of personal identification documents. This commitment presumes that 
State and DHS continue to work with NIST in their drafting of the RFP. 
That has been the case to date.
    Question. Once complete, how does your agency plan to release and 
certify the results?
    Answer. Certification by NIST would be by a letter from the NIST 
Director to the appropriate individual(s) at State and/or DHS noting 
that the test protocols in the RFP verify that the card architecture 
meets or exceeds ISO security standards and meets or exceeds best 
available practices for protection of personal identification documents 
for the chosen technology.
    Question. Do you see a difference between NIST certifying the 
procurement of the technology and certifying the feasibility of the 
technology? If so, please explain.
    Answer. NIST will be neither certifying the procurement of the 
technology nor the feasibility of the technology. Our certification 
will be focused on the specification of the statute: that NIST certify 
that DHS and State ``have selected a card architecture that meets of 
exceeds International Organization for Standardization (ISO) security 
standards and meets or exceeds best available practices for protection 
of personal identification documents.'' We will be conducting this 
certification via ensuring that the set of requirements identified by 
NIST in compliance with the statute are embodied in the Request for 
Proposals that define the compliance requirements for industry.
    Question. Have you or employees in your agency been under any 
pressure to reach a preordained conclusion or hurried certification in 
this matter?
    Answer. NIST has not been under any pressure to reach a pre-
ordained conclusion or hurried certification.
                              mep program
    Question. I understand that the National Institute of Standards and 
Technology (NIST) recently announced its intention to re-compete the 
MEP system beginning in April 2007, and then quickly drew back that 
proposal. I strongly disagree with any re-competition proposal because 
of the disruption it would cause to the national MEP infrastructure and 
the good work accomplished daily by the Vermont Manufacturing Extension 
Center. On top of that, the President's request of $46.3 million is not 
an appropriate level of funding for this valuable program dedicated to 
serving our nation's smaller manufacturers.
    For the past six years, a bipartisan majority of the Congress has 
fully supported the MEP program despite the annual ritual of deep cuts 
proposed by the President. This support stems from the successful 
performance demonstrated by centers nationwide in ensuring the 
sustainability of our domestic small manufacturing industry and its 
high-quality jobs.
    With the fiscal year 2008 congressional budget and appropriations 
processes just beginning, I believe it would be inappropriate for the 
Bush administration to disrupt, re-compete, or restructure the MEP 
program based on its own proposed budget proposal for the coming year. 
On top of that, any such actions during fiscal year 2007 would be 
inconsistent with Congress' intention for those funds.
    In light of the recent announcement by the NIST that it will not 
re-compete the program in April, I ask the following questions of 
Secretary Gutierrez and Director Jeffrey:
    What factors, considerations, or conversations made you change your 
mind in the eleven days that passed between your February 15 re-
competition announcement and your February 26 announcement that the re-
competition would cease?
    Answer. The proposed re-competition was intended as a contingency 
to ensure the strongest network possible regardless of final 
appropriations. To conduct such a competition would take approximately 
5-6 months, which is why we initially looked towards late spring of 
2007 to initiate the process. This would provide us the necessary data 
to make informed decisions at the beginning of fiscal year 2008--once 
the fiscal year 2008 enacted budget was known. Based upon inputs from 
the MEP Center Directors, Congressional Members and Staff, and others 
it became clear that the process of the re-competition would be 
disruptive to current Center operations. We, therefore, decided not to 
hold this re-competition.
    Question. This is not the first time you have tried to re-compete 
the MEP program, as you attempted to mount a re-competition less than 
three years ago.
    Now that you have changed course again, can you assure us that you 
will not attempt a re-competition for a third time in 2008? If you 
cannot make this affirmation, under what circumstances, and with what 
policy objectives, can you envision proceeding down the re-competition 
path again?
    Answer. We cannot make that definitive affirmation. The goal of MEP 
is to support the Nation's small manufacturers. The MEP program will 
therefore examine all possible alternatives to most effectively achieve 
that goal given any enacted budget level.
    Question. In your written testimony, you state, ``The reduction of 
Federal funds to the local centers may have to be compensated through a 
combination of increased fees derived from the benefits accrued by 
individual companies and cost-savings in the operations of the 
centers.''
    Please explain what data or reports you have to support that 
increased fees from the benefits accrued by companies and cost savings 
in the operation of the centers are possible.
    Answer. The annual reported benefits by manufacturing clients of 
the MEP Centers conducted through an independent survey demonstrates a 
significant level of cost savings and efficiency improvements for the 
MEP clients. For example, the latest MEP client survey results 
(released January 2007 and reflecting fiscal year 2005 benefits) 
demonstrate that MEP helped 16,448 clients create and retain 53,000 
jobs; increase and retain sales of nearly $6.3 billion; and generated 
cost savings of just over $1.3 billion (both recurring and non-
recurring). These impacts resulting in reduced costs and potentially 
increased profits for the client could be used to support increased 
fees for future services. With increased revenues streams from client 
fees, MEP centers may offset, in whole or in part, the reduction in 
Federal funds.
    Question. I understand that you may be considering the creation of 
regional innovation centers across the country.
    Are you considering this idea? If so, how do you envision the 
constitution of these centers? What role would the MEP play in this 
plan?
    Answer. MEP has no plans to develop regional innovation centers.
    Question. Has the NIST consulted with its state partners to ensure 
that state governments, which provide cost share to these programs, are 
comfortable with their state resources being used across state 
boundaries? If so, please describe the reaction of these state 
partners.
    Answer. MEP has no plans to develop regional innovation centers. 
MEP routinely consults with its state partners on programs priorities 
and alignment with state initiatives.
    Question. The MEP system is an effective, economic development 
program that has generated results, created and retained jobs, and 
leveraged local partnerships. In fiscal year 2005 alone, as a direct 
result of MEP services, clients reported more than $6.25 billion in new 
and retained sales, $1.304 billion in cost savings, $2.248 billion in 
client investment in modernization, 17,453 jobs created, and 35,766 
jobs retained. Thus, it appears that MEP returns far exceed the initial 
investment.
    What is your plan for building on this proven resource to produce 
even greater results for American manufacturers and workers?
    Answer. MEP will build upon our foundation of process improvements 
with clients to develop innovation and growth services that will 
position U.S. manufacturers to meet the increasing demands of the 
global marketplace. A key focus will be providing manufacturers with 
access to the technologies needed for the development of new processes 
and innovative products.
    We also will focus on supplier development since small 
manufacturers are such a crucial part of the supply chain.
    Question. It is no secret that one of the biggest challenges facing 
small American manufacturers is competition from low-cost overseas 
producers. As large Original Equipment Manufacturers seek the best, 
fastest, and cheapest suppliers, they are increasingly looking 
overseas. Even our major defense contractors are purchasing more from 
overseas suppliers, putting our Nation in the position of depending on 
parts from other countries to equip our troops.
    Have you contemplated using the MEP system to strengthen our 
domestic suppliers so that we can preserve jobs in the United States 
and keep more defense suppliers in this country? If not, would you 
consider undertaking that evaluation?
    Answer. MEP has already been working with domestic defense 
suppliers and manufacturers by providing technical assistance and 
training to improve productivity, reduce costs, and develop a highly-
skilled workforce. The small manufacturers that MEP Centers have worked 
with are crucial to a robust defense supply chain. The strengthening of 
this supply chain should help keep critical defense supply and 
manufacturing jobs in the United States.
    Specific projects within the aerospace and ship building industries 
have resulted in connecting small machining companies with Defense 
acquisition opportunities and creating groups of engineering and 
manufacturing companies that work collaboratively to supply critical 
defense equipment and parts.
                                 ______
                                 
                Questions Submitted by Senator Herb Kohl
                         mep defense suppliers
    Question. It is no secret that the biggest challenge facing small 
American manufacturers is competition from low-cost overseas 
manufacturers. As large manufacturers seek the best, fastest, and 
cheapest suppliers, they are increasingly looking overseas. With great 
success, the Wisconsin MEP center has worked with large manufacturers 
like Oshkosh Truck, Harley Davidson and John Deere on a supplier 
development model to keep jobs at home.
    So far, the Wisconsin MEP has trained MEP centers in sixteen 
states, proving there is a strong need for this training nationally.
    Mr. Jeffrey, can you develop a plan based on the Wisconsin model 
for using the MEP system to strengthen our domestic suppliers so that 
we can preserve jobs in the United States and keep more suppliers in 
this country?
    Answer. The Wisconsin MEP Supplier Development model addresses 
several components of the supply chain issues faced by manufacturers. 
The Wisconsin model and the positive impacts realized by manufacturers 
have been presented at several MEP quarterly meetings making more 
centers aware of the approach. Within the past year, fifteen other MEP 
Centers have participated in or employed the model assisting 123 small 
and medium-sized suppliers in states, such as Illinois, Indiana, Iowa, 
Missouri, Minnesota, Ohio, Pennsylvania, and Texas.
                          mep and energy costs
    Question. When I talk to manufacturers in Wisconsin, they tell me 
the same thing I am sure you are hearing across the Nation: energy 
costs are killing them. In the 2005 Energy bill, I inserted language 
into the Energy bill that directs the Small Business Administration to 
work with you and the MEP program to improve energy efficiency for 
small businesses, including manufacturers.
    Can you update me on what is going on with this program?
    Answer. Building upon existing relationships and contacts with 
other Federal agencies, NIST MEP has offered the assistance of the 
national network to educate manufacturers and better implement energy 
management approaches as described in the Energy Policy Act of 2005.
    NIST MEP has coordinated with the Small Business Administration 
(SBA) Small Business Development Center, the Department of Energy (DOE) 
Industrial Technologies Program and the Environmental Protection Agency 
(EPA) Partnership Programs on the HVAC Maintenance Consumer Education 
Program.
    NIST MEP is also developing a comprehensive energy awareness and 
implementation program with manufacturers that will result in increased 
energy efficiency, reduced business and operations costs, waste 
reduction, and new technology adoption.
    MEP has also teamed with the EPA through the Green Supplier 
Network--a collaborative venture among industry, the EPA, and MEP--to 
help suppliers learn ways to save money, optimize resource use, and 
eliminate waste through on-site technical reviews. This will help 
reduce the negative impact that manufacturing suppliers have on the 
environment.
    DOE's Industrial Assessment Centers (IAC) are sharing their energy 
assessment expertise and tools with MEP, which in turn help small 
manufacturers on the HVAC Maintenance Consumer Education Program and 
other similar energy conservation related efforts.
    MEP and SBA have developed a joint-teaming delivery system that 
provides small businesses with access to Lean implementation tools to 
improve business operations and reduce operating costs contributing to 
energy conservation.
    In a broader context, MEP has taken the lead in organizing the 
Interagency Network of Enterprise Assistance Providers (INEAP)--a 
network of Federal government agencies and programs including EPA, SBA 
and DOE's IACs--that addresses issues that facilitate the success of 
small businesses and smaller manufacturers.
                                 ______
                                 
                Questions Submitted by Senator Jack Reed
               survey of income and program participation
    Question. The President's budget for last year proposed eliminating 
the Survey of Income and Program Participation (the SIPP) but according 
to many experts it failed to provide an adequate plan for maintaining 
the kind of longitudinal data that CBO and others have used to analyze 
income volatility. What is being done to make sure that we continue to 
collect data that allows us to examine the impact of a wide variety of 
government programs over time?
    Answer. Census is continuously consulting with major SIPP 
stakeholders to assure that the new Dynamics of Well-being System 
(DEWS) will continue to supply the data needed to meet the goals of the 
current SIPP as well as the goals of monitoring a changing economy. The 
overall goal of the DEWS is to reengineer the current SIPP to construct 
a streamlined system that can provide similar information at a reduced 
cost, with improved data quality, improved timeliness, and improved 
data accessibility. While the lag between data collection and release 
decreases over time within a SIPP Panel, at the beginning of a panel 
the lag between data collection and release can be as long as three 
years. By contrast, we anticipate being able to release data from DEWS 
within one year of their collection.
    The system will be able to generate data that can be used, in part, 
as SIPP data have been used, to provide accurate and comprehensive 
information about the income and program participation of individuals 
and households in the United States. The DEWS will provide a nationally 
representative sample that can be used to evaluate the annual and sub-
annual dynamics of income, the movements into and out of government 
transfer programs, the effect on family and social context of 
individuals and households, and the interaction among these items. The 
longitudinal nature of SIPP will be retained in DEWS as a critical 
aspect of its value to many major stakeholders. The three year panel 
length planned for the first Panel of DEWS is the minimum length of 
time major stakeholders, including CBO, felt necessary for their 
longitudinal analysis.
    Question. Is there sufficient funding in the budget to prevent a 
``data gap'' between ending the SIPP and the new Dynamics of Economic 
Well-being System (DEWS)? Will we be able to compare data historically 
between the two surveys?
    Answer. The Budget provides $15.9 million (an increase of $6.7 
million over the 2007 Budget) to continue the development of the new 
Dynamics of Economic Well-being System (DEWS). However, to ensure 
Census can focus its efforts and be successful at fielding the new 
survey in 2009, the Budget does not include funding to continue SIPP 
data collection in 2008. Therefore, there will be a short ``data gap'' 
between ending the SIPP and beginning of DEWS.
    Data collection will end for SIPP in September 2007. We will have 
full data through May, partial data through August, and no data from 
September through December 2007. The first DEWS data collection will 
provide data for calendar year 2008. It should be noted that there have 
been gaps in the SIPP series before. For example to enable the Census 
Bureau to initiate a new panel in February 2001 and process data more 
recently collected, data collected from February to September 2000 were 
never released and data from October 2000 to January 2001 were never 
collected. Based on those experiences and consultations with our 
Federal agency partners, we believe that a similar data gap between 
SIPP and DEWS will not hamper program evaluation or modeling. Unless 
the two surveys are conducted for the same time period, a complete 
evaluation of the impact of any differences in the two surveys on the 
same estimates will not be possible.
    Question. Has Census done any kind of systematic analysis of 
whether we are producing and maintaining the data we need to understand 
the important changes that have been taking place in the economy so 
that we can adequately answer the kinds of questions that keep coming 
up about the extent of income volatility or the impact of outsourcing 
or globalization on the quality of jobs?
    Answer. Census is continuously consulting with major SIPP 
stakeholders to assure that the new Dynamics of Well-being System 
(DEWS) will continue to supply the data needed to meet the goals of the 
current SIPP as well as the goals of monitoring a changing economy. The 
DEWS will provide a nationally representative sample that can be used 
to evaluate the annual and sub-annual dynamics of income, the movements 
into and out of government transfer programs, the effect on family and 
social context of individuals and households, and the interaction among 
these items. Labor force participation is integral to measuring these 
concepts, and in evaluating and modeling the effects of programs on 
these estimates. DEWS will continue to provide the same general labor 
force information historically provided by SIPP. As far as we know, 
however, SIPP has never been used to specifically evaluate the impact 
of outsourcing or globalization on the quality of jobs.
                                 ______
                                 
             Questions Submitted by Senator Robert C. Byrd
                           ita trade act 2002
    Question. The Trade Act of 2002 requires that the Bush 
Administration reserve the U.S. trade laws. I understand that, in prior 
appearances before the Congress, namely before the Senate Finance 
Committee, you advised Senator Rockefeller that you would ``vigorously 
defend and enforce our existing trade remedy laws, and implement those 
laws as intended to stop dumped or subsidized goods from injuring U.S. 
industries.''
    While the United States has made some submissions in the Rules 
negotiations in the past two years, with the exception of papers on 
causation, expanding prohibited subsidies, and the proposal on 
perishable and seasonal agricultural products, most proposals either 
simply seek to codify existing U.S. practice, or improve transparency 
and processes abroad.
    Consequently, would you please identify for the Committee (1) each 
WTO dispute over the past five years in which U.S. trade remedy laws 
have been challenged and in which the WTO has issued a determination 
adverse to the United States; and (2) what specific proposals to 
correct those erroneous determinations have been submitted by the 
United States in the Rules negotiations in either 2005 or 2006. If no 
specific proposals have been submitted by the United States in the last 
two years, please identify when such proposals will be submitted, 
consistent with the Congressional mandate contained in the Trade Act of 
2002.
    Answer. There have been numerous WTO disputes over the last 5 years 
in which the U.S. trade remedy decisions have been challenged. In 
response, we have pursued an aggressive strategy in the WTO Rules 
Negotiations of defending our trade remedy regime, targeting the unfair 
trade practices of others, and improving transparency and due process 
in trade remedy proceedings so that U.S. producers and exporters are 
fairly treated. We continue to follow the basic principles that we laid 
out early in the Rules negotiations, namely to seek to: (1) maintain 
the strength and effectiveness of the trade laws; (2) enhance 
transparency and due process requirements; (3) enhance disciplines on 
trade distorting practices that lead to unfair trade; and (4) ensure 
that dispute settlement panels and the Appellate Body do not impose 
obligations that are not clearly contained in the Agreements.
    As of July 2006, when the formal negotiations were suspended, the 
U.S. negotiating team advanced proposals to address many of the Rules 
issues that are negotiating ``priorities'' for our domestic industry 
and Congress. These include such areas as facts available, causation, 
and the all-others rate, where we are seeking to correct the 
substantive results of certain disputes that we think were incorrectly 
decided by WTO panels. Some of the other proposals advanced include 
circumvention, new shippers, and perishable seasonal agriculture, all 
of which are priorities identified by the domestic industry and 
Congress.
    This Administration is committed to strong enforcement of our trade 
laws, and fulfilling our TPA obligations. The Administration will 
continue to consult closely with the Congress as the negotiations 
proceed.
              continued dumping subsidy offset act of 2000
    Question. The Administration previously recognized that the WTO 
decision on the Continued Dumping and Subsidy Offset Act of 2000 or 
``CDSOA,'' also known as the Byrd Amendment trade law, incorrectly 
imposed obligations on the United States by prohibiting the 
distribution of monies collected as antidumping and countervailing 
duties on unfairly traded U.S. imports. Congress repeatedly called for 
negotiations in the Doha Round to address this issue, not only in 
letters sent to the Administration, but also in legislation signed into 
law. Further, report language accompanying a series of Consolidated 
Appropriations Acts directed the Administration to report to the 
Appropriations Committee every 60 days on the status of those 
negotiations. I understand that Commerce Department officials have a 
very important role in such negotiations, as do USTR negotiators. By 
law, the Administration has been directed to negotiate a solution to 
this trade dispute.
    In April 2004, the United States did submit a proposal in the Rules 
negotiations to recognize ``the right of Members to distribute monies 
collected from antidumping and countervailing duties.'' And, while 
undergoing your confirmation process, you explained that the Department 
of Commerce and the Office of the U.S. Trade Representative were 
consulting to ensure proper implementation of the requirements of U.S. 
law regarding negotiations over CDSOA distributions. You indicated that 
the agencies would complete those consultations as soon as possible. 
You also agreed to continue to work to advance congressional objectives 
in the Doha Round negotiations, including reversal of not only the 
adverse CDSOA decision, but also other WTO decisions where WTO 
Panelists and the Appellate Body have overreached and created 
obligations never agreed to by U.S. negotiators.
    Since committing to ``pursue changes to those Agreements that will 
reverse specific adverse findings, including those regarding the 
Continued Dumping and Subsidy Offset Act,'' the United States has not 
submitted any further proposals recognizing the right of WTO Members to 
distribute monies collected from antidumping and countervailing duties.
    Can you please explain how the Administration intends to obtain an 
acceptable and expeditious solution to the CDSOA and other WTO 
disputes, where the WTO has inappropriately breached its authority in 
decisions adversely affecting the trade laws of the United States?
    Answer. We have been concerned with the possibility of the WTO 
dispute settlement system, in your words, ``inappropriately breach[ing] 
its authority.'' The USTR has noted our disagreement with certain 
dispute settlement reports and the reasons for those disagreements in 
appropriate circumstances. In addition, Commerce has raised WTO panel 
decisions on such topics as zeroing in the ongoing Rules negotiations. 
As you know, Congress repealed the CDSOA to comply with the adverse WTO 
ruling. We evaluate each decision on its own and work in conjunction 
with Congress to find an appropriate response. Where we believe 
revision of the agreement is necessary, we work with other members of 
the WTO toward accomplishing those changes.
                              wto disputes
    Question. From 1995 to 2006, over 40 percent of all decisions 
adopted by the WTO Dispute Settlement Body addressed trade remedy 
disputes involving the WTO Antidumping (AD), Subsidies and 
Countervailing Measures (SCM) and Safeguards Agreements. And, I 
understand that, in 2005 and 2006, an even higher percentage--over 60 
percent--of WTO disputes initiated were trade remedy disputes. The 
United States, which actively helped shape the trade remedy rules and 
has a highly transparent system providing significant due process of 
law, is the primary target of those WTO trade remedy disputes. In fact, 
I have been advised that the United States has been the defending party 
in roughly 60 percent of the trade remedy decisions adopted by the WTO 
Dispute Settlement Body from 1995 to 2006. More specifically, the 
United States was the defending party in almost 50 percent of requests 
for consultations filed since 1995 concerning the WTO Antidumping 
Agreement in particular. Yet, the United States imposed only 12.6 
percent of all antidumping measures imposed by all WTO Members from 
1995 to June 2006. In the trade remedy area, the WTO has, often 
wrongly, found one or more violations by the United States in nearly 90 
percent of disputes, imposing on the United States obligations that our 
Nation never agreed to in trade talks. In fact, the United States 
actively opposed ``zeroing'' during negotiations. Thus, it is clear 
that the WTO dispute settlement system is being used unfairly, 
threatening U.S. sovereignty and eroding the effectiveness of our 
country's trade remedy laws. Despite this, the United States has 
submitted only a handful of publicly available proposals in the Rules 
negotiations suggesting textual modifications to correct instances of 
``overreaching'' by the Appellate Body.
    When and how do you intend to collaborate with USTR to correct this 
continuing imbalance? What is your strategy to rapidly generate textual 
proposals that will better protect existing U.S. trade laws?
    Answer. We are fully aware of the frequency in which the United 
States has had to defend its trade remedy laws before the WTO Dispute 
Settlement Body and have collaborated with USTR to address this issue 
since the inception of the Doha Round. In the context of the Dispute 
Settlement Understanding negotiations, we have raised proposals 
addressing the problem of the Appellate Body creating rights and 
obligations that are not contained in the underlying agreements. 
Additionally, in the Rules negotiations, the United States continues to 
emphasize the importance of clearly written rules so that the dispute 
settlement process will involve less interpretation to the extent that 
the intent of the Members is clearer. As the negotiations progress, in 
close coordination with USTR, we plan to intensify our efforts to 
advance the proposals already tabled that will protect U.S. trade laws 
and direct the WTO Dispute Settlement Body toward a balanced decision 
making process.
                  doha dispute settlement negotiations
    Question. Specifically concerning the issue of the Doha Dispute 
Settlement negotiations, during your confirmation process, you offered 
a general strategy of: (1) increasing Member nations' control over the 
dispute settlement process; (2) increasing transparency; (3) pursuing 
changes to the Rules Agreements to ensure that panels and the Appellate 
Body adhere to the appropriate standards of review; and (4) pursuing 
changes to the Rules Agreements that ``will reverse specific adverse 
findings, including those regarding the Continued Dumping and Subsidy 
Offset Act, `zeroing,' and injury determinations.''
    Can you please provide the status of U.S. efforts to advance 
negotiations concerning items (1), (2), and (3), above, and advise the 
Committee when specific proposals will be submitted by the United 
States addressing the fourth item, namely reversing the WTO's findings 
with respect to CDSOA, zeroing, and injury determinations?
    Answer. In the context of the Dispute Settlement Body negotiations, 
USTR, collaborating with Commerce, has introduced two sets of 
proposals--including proposed text. The first set of proposals would 
expand transparency and public access to dispute settlement proceedings 
by opening panel hearings to the public, requiring public versions of 
written submissions, providing for early public release of panel 
reports, and setting guidelines for amicus curiae submissions. The 
second set of proposals, submitted jointly with Chile, contains 
provisions aimed at giving parties to a dispute more control over the 
process and greater flexibility to settle disputes. These proposals 
address such concepts, among others, as ensuring that panel members 
have appropriate expertise to appreciate the issues presented in a 
dispute and providing additional guidance to WTO adjudicative bodies 
concerning the nature and scope of the issues and rules of 
interpretation of the WTO agreements. These proposals are still on the 
table, and as the negotiations progress, we will intensify our 
collaboration with USTR to advance the key concepts encompassed by the 
proposals.
    We agree that the Appellate Body's findings raise concerns; 
however, we also place significant importance on respecting the dispute 
settlement system and addressing the findings, whether we agree with 
them or not, through the appropriate mechanisms. First, we are 
developing our thoughts and options with respect to implementation and 
are committed to consulting closely with Congress as to the appropriate 
way to move forward in response to the Japan zeroing report. Second, we 
will continue to use the Rules negotiations as a forum to educate other 
Members on the troubling implications of the Appellate Body reports, 
particularly with respect to their own antidumping systems. We firmly 
believe that the zeroing issue is one that must be addressed through 
negotiation and we are in close consultation with USTR regarding how to 
move forward.
    Likewise, injury is part of our affirmative agenda in the Rules 
negotiations, and we have submitted proposals to address specifically 
the problem created by the WTO decision related to this issue. As the 
Negotiations progress, we will continue to advance these proposals and 
address our injury concerns as an integral part of the U.S. negotiating 
strategy.
    Regarding CDSOA, we have been concerned with the possibility of the 
WTO dispute settlement system, in your words, ``inappropriately 
breach[ing] its authority.'' The USTR has noted our disagreement with 
certain dispute settlement reports and the reasons for those 
disagreements in appropriate circumstances. However, in light of the 
importance we attach to respecting the dispute settlement system, noted 
above, and the potential consequences of a failure to abide by 
Appellate Body decisions, we evaluate each decision on its own and work 
in conjunction with Congress to find an appropriate response. Where we 
believe revision of the agreement is necessary, we work with other 
members of the WTO toward accomplishing those changes.
                           wto appellate body
    Question. As described in prior questions, it is unfortunate that 
the WTO Appellate Body for several years now has been engaged in 
improperly expanding its mandate by making a series of decisions that 
undermine our Nation's trade remedy laws. One of the most egregious of 
these decisions has been issued against the U.S. antidumping duty 
practice called ``zeroing.
    On one level, the Bush Administration should be commended for 
combating these zeroing decisions, which would force the United States 
to collect less than 100 percent of dumping duties owed. For example, 
in recent statements before the WTO Dispute Settlement Body, the 
Administration has called Appellate Body reports against zeroing 
``deeply flawed,'' and ``devoid of legal merit.''
    Yet, on February 22, 2007, the Commerce Department nonetheless 
implemented the findings of the Appellate Body with respect to 
``zeroing'' in investigations, and, two days earlier, the 
Administration told the WTO that it would comply with its WTO 
obligations with respect to ``zeroing'' in other phases of antidumping 
proceedings.
    Why would the United States implement Appellate Body reports that 
it admits are ``deeply flawed'' and ``devoid of legal merit''? Couldn't 
the United States simply refuse to implement these ``deeply flawed'' 
WTO decisions and, instead, seek a negotiated solution through the WTO 
Doha Round negotiations? This would be consistent with our Nation's 
statements on the Appellate Body's report before the Dispute Settlement 
Body (DSB), which consisted of the following:

    ``Were this a municipal court result, such an illogical outcome 
would be a prime candidate for reconsideration by the legislative 
branch. That is no less the case here, and the United States submits 
that Members take up this issue, which affects the antidumping systems 
of a number of Members, in the Rules negotiations.''

    When will the United States submit a proposal in the Rules 
negotiations addressing this issue?
    Answer. We agree that the Appellate Body's recent findings on 
zeroing in reviews are very troubling, however, we also place 
significant importance on respecting the dispute settlement system and 
addressing the findings, whether we agree with them or not, through the 
appropriate mechanisms. To that end, we are thinking about this issue 
along two tracks. First, we are developing our thoughts and options 
with respect to implementation and are committed to consulting closely 
with Congress as to the appropriate way to move forward in response to 
the Japan zeroing report. Second, we will continue to use the Rules 
negotiations as a forum to educate other Members on the troubling 
implications of the Appellate Body reports, particularly with respect 
to their own antidumping systems. We firmly believe that this zeroing 
issue is one that must be addressed through negotiation and we are in 
close consultation with USTR regarding how to move forward.
                           cafta--sock trade
    Question. In July 2005, during the CAFTA debate before the U.S. 
House of Representatives, you and U.S. Trade Representative Portman 
wrote a letter in which you advised that the United States would 
initiate a special CAFTA textile safeguard re-imposing U.S. tariffs on 
imported socks for three years, if imports ``cause or threaten to cause 
serious damage to the domestic industry.'' You stated that you wished 
to be ``pro-active in initiating a sock safeguard if the situation were 
to warrant it.''
    I have been apprised that, since CAFTA came into effect 11 months 
ago, sock imports from Honduras have increased by roughly 40 percent. 
Domestic production is falling, and over 20 U.S. sock mills have 
closed. Because it appears that the situation today may warrant the 
initiation of a safeguard on imported socks, is the Administration 
prepared to seek such a safeguard? Does the Administration intend to 
honor its prior commitment to the Congress in this regard, even as it 
seeks additional free trade agreements? Is there some reason that 
CAFTA's negotiators failed to anticipate and address the possibility of 
such an un-level playing field in trade in socks?
    Answer. As you noted, on July 27, 2005, USTR Rob Portman and I 
promised Congressman Aderholt that the Administration would (1) include 
socks in any textile agreement with China, (2) ensure that, if the 
existing China sock safeguard was renewed, it would be in place for the 
maximum possible time period at the minimum possible safeguard level, 
(3) seek to amend CAFTA-DR to alter the rules of origin or to lengthen 
the tariff phase-out for socks, and (4) to proactively utilize the 
CAFTA-DR textile safeguard for socks, if warranted. The Administration 
subsequently, as promised, included socks in the China textile 
agreement, concluded a special China sock quota agreement while the 
China textile talks were ongoing, and has pursued a sock amendment to 
the CAFTA-DR. We also are carefully monitoring CAFTA-DR sock import 
data and, as promised, will proactively utilize the CAFTA-DR safeguard, 
if warranted by the facts. To assess whether safeguard action may be 
warranted, the Department of Commerce carefully monitors imports of 
socks from CAFTA-DR signatories and other relevant data, including 
domestic production data, to assess whether imports of socks from these 
countries are causing, or threatening to cause, serious damage to the 
domestic industry as a result of the elimination of duties under the 
Agreement, which went into effect for Honduras on April 1, 2006. 
Notably, imports of socks from Honduras fell in each of the last three 
months of 2006 to levels lower than before CAFTA went into effect. 
Nevertheless, we are closely tracking the data and will act should data 
warrant a safeguard, but it is worth noting that domestic production 
was down by only 1.1 percent in 2006 from 2005 levels.
                                 ______
                                 
            Question Submitted by Senator Richard C. Shelby
                      bea's r&d budget initiative
    Question. The BEA has a proposal for $2.1 million to measure the 
impact of research and development on the economy. Can you tell us more 
about this initiative and how it will impact future GDP calculations?
    Answer. While most economists believe that R&D and other 
investments in intangibles are among the most important sources of 
growth in GDP and productivity--with some estimates ranging as high as 
40 percent of growth--there are no hard official estimates on their 
impact. This project will provide the Nation with a much clearer 
picture of the impact of investments in R&D and other intangibles on 
trend growth in GDP and productivity, as well as their impact over the 
course of the business cycle. The BEA project will provide aggregate 
data, as well as data on the effects across industries, across regions 
of the country, and its impact on our international trade and balance 
of payments. These data will prove useful in a broad variety of 
contexts ranging from monetary policy and budget projections to tax 
policy and the funding of investments in R&D.
    BEA is in the early stages of developing estimates for R&D as 
investment, and these estimates will not be fully incorporated into the 
National Income and Product Accounts until 2013. However, this 
preparatory work, in the form of satellite accounts, can provide 
valuable information on the effect of investment in R&D on U.S. 
economic growth. The preliminary R&D satellite accounts released in 
September 2006 showed R&D investment accounted for 6.5 percent of 
growth in real GDP between 1995 and 2002 and 4.5 percent of growth 
between 1959 and 2002. In comparison, businesses' investment in 
commercial and all other types of buildings accounted for just over 2 
percent of real GDP growth between 1959 and 2002.
                noaa joci and the ocean policy scorecard
    Question. Although NOAA's 2008 budget request boasts a $123 million 
increase for ocean-related activities, it represents a fraction of the 
true budgetary needs for the marine community. For the past few years, 
the Joint Ocean Commission, which formed the inception of the 
President's U.S. Ocean Action Plan, has clearly and objectively laid 
out the budgetary requirements to better support ocean-related science 
research and education. I am extremely concerned that Congress 
continually receives a budget request from the Administration that 
downplays these critical activities. I wonder at what level your 
department endorses marine science, because frankly, Mr. Secretary, the 
Senate is weary of being the only federal entity that champions this 
funding disparity.
    Are you familiar with the Joint Ocean Commission Initiative, and 
the contents of its recent publications, namely the U.S. Ocean Policy 
Report Card for 2006? And are you aware that the category for ``New 
funding for ocean policy and programs'' received the grade of ``F''? 
What are your thoughts on this grade?
    Answer. Yes, I am familiar with both the Joint Ocean Commission 
Initiative and the recent Ocean Policy Score Card. We are pleased to 
note that we have had grade improvements for 2006 in five out of the 
six subject areas. We were also pleased with the overall scores for 
Ocean Governance and Fisheries Management Reform. With respect to the 
grade for ``new funding for ocean policy and programs,'' the scorecard 
was issued prior to the release of the fiscal year 2008 President's 
Budget. The fiscal year 2008 Budget includes significant new increases 
in support of implementing the Ocean Action Plan, addressing many of 
the concerns noted by the Report Card.
     ntia public safety interoperable communications grant program
    Question. Mr. Secretary, your department has entered into a 
memorandum of understanding with the Department of Homeland Security to 
assist in the development of policies, procedures and regulations 
governing the Public Safety Interoperable Communications (PSIC) grant 
program.
    What role will your department play in developing the grant 
guidance package and eligibility requirements for this $1 billion 
program?
    Answer. The Department of Commerce's National Telecommunications 
and Information Administration (NTIA) is working very closely with the 
Department of Homeland Security (DHS) in the development of grant 
guidance and requirements for the program. Consistent with the 
requirements of the Deficit Reduction Act of 2005 and the Call Home Act 
of 2006, NTIA retains final approval authority for policies, procedures 
and regulations that govern the PSIC Grant Program.
    Question. The Department of Homeland Security has been grappling 
with the issue of interoperable communications for years. I sit on the 
appropriations subcommittee for that department as well. These funds 
are intended to focus on the purchase of equipment to address 
interoperability.
    Mr. Secretary, tell me how your involvement will ensure this 
funding will be put to the best use by the localities in Alabama and 
throughout the United States to achieve true interoperability across 
county and state lines?
    Answer. NTIA intends to use its expertise to explore and encourage 
all technology solutions that are available to first responders to 
advance overall interoperability. With the Statewide Interoperability 
Communications Plans and the PSIC investment justifications, NTIA and 
DHS will be able to approve projects that clearly identify 
interoperability gaps and provide the greatest benefit toward improved 
interoperability.
    Question. Will Commerce work to ensure that the choice for a 
workable solution to interoperability will rest in the hands of locals 
and will not be dictated from the federal level?
    Answer. NTIA understands that interoperability is a complex issue 
and no one federal solution exists. Local governments have collectively 
spent billions of dollars on communication infrastructure. The program 
guidance and application process for the PSIC Grant Program will be 
designed to leverage existing investments to build and sustain 
intrastate and interstate regional capabilities and identified needs. 
NTIA is working with DHS to develop the grant guidance that ensures 
that funding will be passed through to eligible public safety agencies.
                    2010 census--cost effectiveness
    Question. The President's budget request includes increased funding 
for the Census Bureau in anticipation of conducting the decennial 
census. These increases are quite significant and will continue to grow 
over the next several years. While this effort is constitutionally 
mandated, there are also other activities that the Census is involved 
in, including surveys of state and local governments, as well as 
economic indicators.
    Mr. Secretary, what efforts are being made to ensure that the 2010 
Census is as cost effective and accurate as possible while maintaining 
the other capabilities the Bureau provides?
    Answer. All the factors that have led to higher costs for each 
decennial census since 1970 will continue--besides inflation and 
increased workload, these include the increased difficulty of ensuring 
coverage accuracy (both overall and for each population group and 
jurisdiction); increased public resistance to answering surveys; and 
increased diversity that make it more difficult to reach everyone. No 
matter what design is chosen, the 2010 Census will be costly.
    For the 2010 Decennial Program, compared to the cost of the 
previous census (2000), the percentage increase in estimated life cycle 
costs will be the lowest in the last four decades. This pattern also 
holds when comparing unit costs. Thus, while achieving the significant 
benefits to our Nation from the annual release of long-form data by the 
new American Community Survey, and improvements to our MAF/TIGER 
(geographic) databases, the Reengineered 2010 Census of Population and 
Housing also will be significantly less costly than historical trends 
would project.
  --Cost containment is one of the four key goals for the reengineered 
        2010 Decennial Census program. When this effort was launched in 
        2001, we estimated it would save over $400 million compared to 
        repeating the Census 2000 approach. And, we now estimate that 
        reverting in fiscal year 2008 to the Census 2000 approach would 
        cost over $1 billion more than continuing with our reengineered 
        approach.
  --Significant savings and accuracy improvements will result from:
    --Not having to collect long-form data in the 2010 Census (because 
            it now is being collected by the American Community 
            Survey),
    --Restructuring our field data collection process to use GPS-
            equipped Handheld Computers (that will benefit from the 
            improvements to our MAF/TIGER databases), and
    --Reducing non-response follow-up workloads by sending a targeted 
            second mailing of questionnaires to households who do not 
            respond to initial mail-out, and being able to 
            electronically remove late mail returns from the non-
            response follow-up assignments on the Handheld Computers.
 security of personally identifiable information on laptops and other 
                            portable devices
    Question. Last year the Department of Commerce reported the loss of 
hundreds of laptop computers, thumb drives and data disks used in 
collecting data for many of its surveys, including data associated with 
the American Community Survey. The Census Bureau is now acquiring 
hundreds of handheld devices to be used by temporary employees as part 
of the 2010 Census.
    Do all portable devices in the Bureau containing sensitive personal 
information have the necessary encryption to protect the data if the 
computer or handheld is lost or stolen?
    Answer. Yes. All data files on the laptops currently being used for 
data collection in census survey and census operations are encrypted 
(FIPS 140-2 compliant). Full disk encryption for the laptops is under 
development and will be implemented later this year. For the 2010 
Census, we plan to use handheld computers for collection of Title 13 
data for three major operations (Address Canvassing, Non-response 
Follow-up and Coverage Measurement Person Interviews), with all others 
still being done on paper. All sensitive data collected during the 2008 
Dress Rehearsal and 2010 Census using the handheld computers will be 
stored on removable secure digital (SD) cards using FIPS 140-2 
compliant encryption software.
    Question. How can we ensure we protect the privacy of our citizens 
if handhelds are lost?
    Answer. In addition to the file encryption described above, census 
enumerators will access their handheld computers through biometric 
technology (fingerprint reader) as well as a response to a question for 
which only they would know the answer. All sensitive data are encrypted 
while stored on the enumerator's handheld computer's secure digital 
(SD) card, as well as during transmission over a secure private network 
to the secure data center. Upon successful transmission, all sensitive 
data on the enumerator's Handheld Computer that are no longer required 
to conduct the census operation will be automatically deleted.
    Question. What procedures have been instituted to track devices 
that contain sensitive personal information within the Bureau?
    Answer. All laptops that currently contain sensitive personal 
information are managed through the Census Bureau's automated property 
management system (APMS). The APMS assigns a unique identifier to each 
device and associates it with the individual that is using it. In 
addition, we are implementing new procedures that will require our 
census field representatives to enter their laptops' unique identifiers 
into an automated questionnaire. This information will be automatically 
retrieved by our control systems and matched against the information in 
the APMS to ensure that all devices are accounted for on a regular 
basis. This procedure should be in place later this Spring.
    With respect to the hand-held computes (HHCs), Secure Digital (SD) 
Cards (SD), laptop computers, and air cards used in the 2008 Dress 
Rehearsal (DR) and 2010 Census, we track who possesses them via a paper 
and an automated tracking system. We track all hand-offs of equipment 
via a paper process. All staff that deliver or are assigned equipment 
sign a paper form acknowledging receipt of that equipment. We also key 
the data from the paper forms into Harris' asset management system. 
Every time a piece of equipment is replaced, the user signs a paper 
form to return the defective device. Staff also sign another paper form 
to acknowledge receipt of the replacement device. All paper forms are 
stored in computer control files in the Local Census Offices.
    Harris provided laptops are used by Field Operations Supervisors. 
These laptops are not used for data collection, but do have PII on 
them, such as payroll data and staff rosters. These laptops will have 
full disk encryption. They will require a user ID and password for 
access during 2008 DR Address Canvassing. We plan to add biometric 
technology (fingerprint reader) in time for DR Non-Response Follow-Up.
    Question. Once the sensitive data is collected on the laptop or 
handheld computer and transmitted to the Census Bureau, how do you 
ensure that the data is scrubbed from these computers?
    Answer. For the laptops currently being used by census field 
representatives, the Regional Office survey manager initiates a process 
to delete data from the laptops based on the interview period. This 
process does not require the census field representative to execute a 
routine; it happens automatically as part of the transmission 
processing. A date is stored in the survey control database indicating 
when this deletion routine was initiated, which allows us to ensure 
that it is happening on a regular basis.
    With respect to the hand held computers that will be used in the 
2008 Census Dress Rehearsal and the 2010 Census, upon successful 
transmission, all sensitive data that are no longer required to conduct 
the census operation will be automatically deleted. In addition, we 
plan to destroy the SD cards following the completion of each operation 
to further ensure data protection. Procedures will be fully developed 
and tested prior to use in the field.
                   reauthorization of the noaa corps
    Question. The Committee understands that the size of NOAA's fleet 
is expanding, yet the NOAA Corps authorization, which regulates the 
size of the NOAA Commissioned Officer Corps, expired in 2005. The 
Committee supports NOAA Corps officers and the valuable expertise they 
lend to NOAA's field operations and homeland security activities.
    When can Congress expect to receive the legislative package 
reauthorizing the NOAA Corps, and may I receive a copy personally?
    Answer. We are interested in reauthorizing the NOAA Corps and we 
look forward to working with the Committee on this important 
legislation. We will ensure that you receive a personal copy of any 
legislation the Administration submits to reauthorize the NOAA Corps 
when it is delivered.
   federal consistency standards and the czma for florida and alabama
    Question. Recently, an issue has come up during my meetings with 
constituents involving interstate coastal zone management activities, 
namely between Florida and Alabama. I am concerned about the potential 
situation arising where one state can influence, or even impede, 
another state's development projects. I am watching this situation 
closely as it unfolds, especially with how it may impact Alabama's 
businesses and economic development.
    What level of assurances can I receive from you that my office will 
be informed of any interstate coastal zone management issues affecting 
Alabama?
    Answer. We understand that this is an issue of high priority and 
importance for Alabama. You have my full assurance that NOAA will 
continue to keep you informed as this process unfolds. At this time, 
there has not been a formal submission by Florida of a request for 
approval to review activities in other states, but, as you know, 
Florida has initiated the state and federal agency consultation process 
to list activities for interstate consistency review. On March 7, NOAA 
staff with the Office of Ocean and Coastal Resource Management 
facilitated a meeting between the coastal program managers for the 
States of Florida, Alabama and Georgia to develop a better 
understanding of Florida' intentions, the concerns of neighboring 
States, and the expectations that NOAA will place on Florida in 
justifying their request for NOAA's approval. In addition to ensuring 
that any change to the Florida Coastal Management program is fully 
consistent with the requirements of the Coastal Zone Management Act and 
NOAA's Interstate Consistency regulations, NOAA will be fully engaged 
in a dialog with all of the states and affected federal agencies in 
addressing whatever concerns may arise from Florida's proposed 
extension of its review authority.
             funding levels for severe weather forecasting
    Question. Severe weather always threatens the Gulf Coast. Although 
last year's hurricane season was relatively light, I still encourage my 
constituents to remain vigilant as flooding, tornadoes and severe 
thunderstorms are a constant danger.
    Are we providing sufficient resources to meet the challenges of 
predicting and protecting our citizens from severe weather events?
    Answer. NOAA's fiscal year 2008 President's budget request fully 
supports its forecast and warning operations. Specifically, NOAA's 
fiscal year 2008 budget requests additional funding to improve its 
hurricane forecasting program: $3 million for hurricane data buoy O&M, 
$1 million for Hurricane Weather-Research Forecast (HWRF) model O&M and 
$2 million to accelerate research to improve hurricane intensity 
forecasts. NOAA is committed to improving operational effectiveness and 
services, particularly for high-impact weather events, by taking full 
advantage of emerging science and technological improvements. We are 
committed to evolving services to best meet the changing and growing 
need for environmental forecasts and services. NOAA's fiscal year 2008 
budget request supports efforts to upgrade the NEXRAD Radar network by 
implementing dual polarimetric radar. It also supports other efforts 
including: improved numerical modeling, data assimilation, education 
and outreach, training, forecaster workstation (AWIPS) upgrades, as 
well as efforts for future technological advances, such as phased array 
radar (PAR). We believe the President's fiscal year 2008 budget request 
positions us to make those technical and service improvements.
                patent allowance versus patent rejection
    Question. I'm aware that you set production goals for PTO 
examiners. Those production goals should of course promote quality 
examination. The last thing we want is for production goals to be based 
solely on patent allowance so that examiner's are motivated to allow a 
patent even if the application doesn't warrant such allowance, 
resulting in poorer quality patents.
    Do you consider patent allowance versus patent rejection when 
setting production goals?
    Answer. Examiner production goals are set so that an examiner 
receives the same amount of credit for an application that is allowed 
or becomes abandoned.
    Question. The Bureau of the Census has initiated a large IT program 
to automate the process of conducting the 2010 Decennial Census, such 
as using wireless GPS-enabled handheld computers to directly capture 
information collected during interviews. This process is expected to 
reduce the need for paper-based processing while increasing operational 
efficiency, improving accuracy and reducing costs.
    Mr. Secretary, former Census Director Kincannon testified before 
Congress last year that capital investment in an automated system to 
replace the traditional paper count will save taxpayers approximately 
$1 billion to conduct the 2010 Census. Is that estimate still accurate?
    Answer. Yes--we still estimate that reverting to paper-based 
operations would add more than $1 billion to the total cost of the 
program. Thanks in large part to the support of Congress in the 
continuing resolution for fiscal year 2007, we have been able to 
continue our efforts for the automation components of the reengineered 
census.
    Last summer, when those funds were in jeopardy, the Census Bureau 
was forced to consider reverting back to paper-based operations that 
would have added over $1 billion to the overall cost of the 2010 
Census. That estimate is based on the savings we expect to achieve 
through the use of handheld computers and other aspects of our 
reengineering efforts. If we have to revert to a paper-based census:
  --The Census Bureau would have to expand space and office staff in 
        over 450 temporary Local Census Offices by 50 percent to 
        conduct 2010 Census operations. The additional space and office 
        staff would be needed to store, track, and process the 
        additional paper forms that will be needed if we do not use 
        handheld computers for data collection.
  --Non-response follow-up and other field operations would be less 
        efficient, requiring significantly more field enumerators.
  --We would have to spend significantly more money visiting households 
        that have already responded to the Census. This is because, 
        without the handheld computers, we would have no ability to 
        remove late mail returns (those households that return their 
        census forms after the date we begin preparing non-response 
        follow-up assignments) from the assignment lists on those 
        devices.
  --Other cost increases would be inevitable, including increased cost 
        for paper and other supplies, mileage, and salaries to conduct 
        a census without automation.
    These additional costs would be offset only partially by reductions 
in automation costs that would not be incurred (under a paper-based 
census) related to the handheld computer equipment.
                    2010 census--handheld computers
    Question. What is the status of the development of the handheld 
computer that is critical to the success of this program?
    Answer. Thanks in large part to the support of Congress in the 
continuing resolution for fiscal year 2007, we have been able to 
continue our efforts for the automation components of the reengineered 
census. For the 2008 Dress Rehearsal and the 2010 Decennial Census, the 
Census Bureau plans to use handheld computers and supporting services 
to directly capture information collected during personal interviews 
and eliminate the need for paper maps and address lists for the two 
largest field data collection operations (Address Canvassing and Non-
response Follow-up) and for the Census Coverage Measurement Personal 
Interview process. The development of handheld computers for these 
operations in the Dress Rehearsal is on-track.
                          dvd piracy in mexico
    Question. The Department of Commerce is part of the 
Administration's effort to combat global piracy. I understand U.S. 
businesses are concerned about DVD piracy in Mexico.
    Can you comment on the implications of the recent DVD and CD raid 
in Mexico City and what this might mean for United States-Mexican 
cooperation to combat piracy?
    What is Commerce's role on this issue?
    Answer. The Department of Commerce is encouraged by the Mexican 
Government's efforts to combat piracy and counterfeiting over the past 
year. Recent raids by Mexican enforcement officials during February and 
March reflect the new Calderon Administration's commitment to the rule 
of law and economic competitiveness. However, greater enforcement 
efforts and stronger prosecution are still needed in Mexico. According 
to the 2007 Special 301 Submission by the International Intellectual 
Property Alliance, trade losses due to copyright piracy in Mexico are 
estimated to have exceeded $1 billion in 2006. Accordingly, Commerce 
continues to monitor Mexico's progress on intellectual property rights 
(IPR) issues through the combined efforts of an interagency IPR team. 
Additionally, Commerce and the U.S. Trade Representative (USTR) are 
working with the Governments of Mexico and Canada on the Security and 
Prosperity Partnership of North America Intellectual Property Action 
Strategy, a trilateral initiative to combat piracy and counterfeiting 
in North America.
    Finally, the USPTO conducts several programs for government 
officials in order to improve the level of expertise on intellectual 
property enforcement in Latin America. In August of 2006 and February 
2007, the USPTO invited Latin American government officials to its 
Global Intellectual Property Academy. The Academy provided practical 
intellectual property rights enforcement education and capacity-
building to Latin American judges, prosecutors, customs officials, law 
enforcement officers and others who are involved in the civil, 
administrative or criminal enforcement of intellectual property rights. 
Mexican government officials participated in the Academy.
    Also, in December of 2006, the USPTO held a Seminar for the 
Judiciary on Intellectual Property Enforcement. The program was 
attended by both Mexican and Central American judges.
                           ita cafta nations
    Question. Since the enactment of CAFTA, the domestic sock industry 
has continued to close plants. The CAFTA nations, particularly 
Honduras, have increased their production and importation of socks to 
the United States by significant amounts to the detriment of our 
domestic industries. Why has the Department of Commerce not granted 
their promise to extend the period for tariffs on socks produced in 
CAFTA nations?
    Answer. As you know, on July 27, 2005, USTR Rob Portman and 
Secretary Gutierrez promised Congressman Aderholt that the 
Administration would (1) include socks in any textile agreement with 
China, (2) ensure that, if the existing China sock safeguard was 
renewed, it would be in place for the maximum possible time period at 
the minimum possible safeguard level, (3) seek to amend CAFTA-DR to 
alter the rules of origin or to lengthen the tariff phase-out for 
socks, and (4) to proactively utilize the CAFTA-DR textile safeguard 
for socks, if warranted. The Administration subsequently, as promised, 
included socks in the China textile agreement, concluded a special 
China sock quota agreement while the China textile talks were ongoing, 
and has pursued a sock amendment to the CAFTA-DR. We also are carefully 
monitoring CAFTA-DR sock import data and, as promised, will proactively 
utilize the CAFTA-DR safeguard, if warranted by the facts. To assess 
whether safeguard action may be warranted, the Department of Commerce 
carefully monitors imports of socks from CAFTA-DR signatories and other 
relevant data, including domestic production data, to assess whether 
imports of socks from these countries are causing, or threatening to 
cause, serious damage to the domestic industry as a result of the 
elimination of duties under the Agreement, which went into effect for 
Honduras on April 1, 2006. Notably, imports of socks from Honduras fell 
in each of the last three months of 2006 to levels lower than before 
CAFTA went into effect. Nevertheless, we are closely tracking the data 
and will act should data warrant a safeguard, but it is worth noting 
that domestic production was down by only 1.1 percent in 2006.

                          SUBCOMMITTEE RECESS

    Senator Mikulski. We're going to stand in recess until next 
Thursday, March 8, continuing our innovation oversight 
hearings. We will be getting testimony from the National 
Oceanic and Atmospheric Administration, and the Director of the 
National Science Foundation.
    This subcommittee stands in recess until March 8.
    [Whereupon, at 11:50 a.m., Thursday, March 1, the 
subcommittee was recessed, to reconvene at 10 a.m., Thursday, 
March 8.]




















  COMMERCE, JUSTICE, SCIENCE, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2008

                              ----------                              


                        THURSDAY, MARCH 8, 2007

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:05 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Barbara A. Mikulski (chairman) 
presiding.
    Present: Senators Mikulski, Inouye, Reed, Stevens, Shelby, 
and Hutchison.

                         DEPARTMENT OF COMMERCE

            National Oceanic and Atmospheric Administration

STATEMENT OF VICE ADMIRAL CONRAD LAUTENBACHER, JR., 
            ADMINISTRATOR

                STATEMENT OF SENATOR BARBARA A. MIKULSKI

    Senator Mikulski. Good morning and welcome to the second 
hearing of the Commerce, Justice, Science Subcommittee. As I 
said in the first hearing, the themes of the subcommittee will 
be innovation, security, and accountability. Today's hearing 
will focus on two of the premiere agencies that promote 
innovation in our society and using the principles of the 
gathering storm, which is that innovation rests on research, 
discovery as well as on education. We are looking forward to 
hearing from the National Science Foundation (NSF) as well as 
the National Oceanic and Atmospheric Administration (NOAA).
    Just a brief announcement before I go more deeply into my 
statement and listen to our ranking member. On March 25, the 
subcommittee will conduct a classified hearing on the Federal 
Bureau of Investigation (FBI), which will deal with their role 
in counterterrorism. We remember that after 9/11, we chose not 
to create--but an agency within the agency. There are aspects 
of the agency's law enforcement responsibilities that are 
deeply involved in the global war against terrorism. We will be 
holding traditional public hearings but we will also be holding 
classified hearings. So we want to alert the members of the 
very important meeting with the FBI.
    But today, we're examining the budgets for the National 
Science Foundation and NOAA, focusing on innovation, education, 
and accountability. This isn't about line items in the budget. 
It's about our country and how we're going to compete in the 
global economy. It's about science. It's about the climate 
crisis. It's about educating our young people to come into the 
fields of science, technology, and engineering. We're holding 
this hearing in the midst of an awakening in this country about 
these particular issues. We all know that the issue just of 
climate--the climate crisis has resulted in a former colleague 
winning an Oscar and who knows, maybe a Nobel Prize.
    The CJS Subcommittee is the innovation subcommittee in the 
United States Senate appropriation process.
    NSF and NOAA are two key innovation agencies relating to 
discovery that have power to save lives, protect our 
communities, protect the planet, and create prosperity for our 
country. I'm pleased that the NSF is in the President's 
innovation agenda but I'm sorry that NOAA isn't as well.
    As we look at today's hearing, we will be looking at broad 
topics but I want to assure everyone that one of the areas of 
focus will be on the climate crisis. The CJS Subcommittee is 
going to look a little green while we look at the blue planet.
    What do I mean by that? I believe that every public policy 
should be based on sound science. In that way, we can build the 
coalitions necessary to create the positive and constructive 
solutions while minimizing at the same time, any economic 
increase or dislocation.
    As we look at the budget requests for NSF and NOAA, we're 
going to follow the roadmaps given to us by the National 
Academy of Sciences and the blueprint given to us by the Joint 
Ocean Commission initiative.
    Seventy percent of the Earth is covered by oceans. When you 
look at us from space, we are big blue. Our Nation's economy 
depends on the oceans, contributing over $120 billion to our 
Nation's economy, supporting 2 million jobs. The Senator from 
Alabama as well as myself, are coastal Senators. We know how 
important our oceans and our estuaries are. We also know how 
oceans influence the weather and we know that the focus also of 
this subcommittee will be a very good weather prediction.
    Alabama was hit very hard by Katrina and they worry about 
every hurricane season. Maryland was hit so hard most recently 
by Isabel. We need the National Weather Service but we need 
also those scientists and so on, that can give us early 
predictions and early warnings but also those kinds of things 
that mitigate against what is changing in our climate that then 
could be exacerbating these weather disruptions that we are 
seeing, from wild fires to hurricanes.
    At the same time, we want to know about education, how 
we're going to be able to attract the best and the brightest 
into science, engineering, and technology. What are the 
financial supports that we need to provide to be able to do 
that? Because that is where our future lies.
    At the same time, we'll be focusing on the accountability 
from the NOAA satellites to the NSF research stations and 
observatories. We know they are critical tools but we have 
faced cost overruns and schedule slippages.
    So we're here--we're here to really promote innovation. So 
it is not about agencies. It's not about line items, though it 
is about that. But it is about our Nation's future. I want to 
make sure we continue to be a superpower but that our 
superpower rests on our intellectual capital and the values 
that we stand for in the world.
    Having said that, I turn to my ranking member, Senator 
Shelby, for anything he has to say.

                 STATEMENT OF SENATOR RICHARD C. SHELBY

    Senator Shelby. Thank you, Madam Chairman and thank you, 
Admiral Lautenbacher and Dr. Bement for joining us today.
    This is an important hearing, as the chairman has pointed 
out because it gives me the opportunity to talk about the 
critical roles the National Oceanic and Atmospheric 
Administration we know as NOAA and the National Science 
Foundation, the NSF, play in the economic, scientific, and 
technology drive the engine of our country's economic future, 
as the chairman mentioned.
    Cutting edge technology creates a better quality of life 
for all of us. The strategic Federal investment in scientific 
research, particularly the funding supporting NSF has led to 
innovative problem solving and technological developments that 
have dramatically increased the country's economic growth.
    NOAA's budget request for the year 2008 is $3.8 billion. 
This is a decrease of $100 million from the funding level 
provided in the joint resolution of 2007.
    In stark contrast to the budget for NOAA, the budget 
request for NSF is $6.4 billion, an increase of $513 million 
over the 2007 joint resolution level.
    Our Nation as a whole seems to do more to protect--needs to 
do more to protect our citizens, not just with storm prediction 
but also with disaster response and community preparedness. We 
must improve short-term forecasting and gain a better 
understanding of long-term climate change. The National Weather 
Service, which is an important part of NOAA, is key to this 
understanding. After forecasting, we must explore what can be 
done in advance communications so that warnings can reach 
communities quicker. We must find better ways to respond. 
Emergency coordination after a severe storm is a critical but 
often overlooked function in saving lives.
    Last Friday, as a lot of you know, my home State of Alabama 
was devastated by a storm system that spawned killer 
tornadoes--I believe it was Thursday that claimed the lives of 
10 people and destroyed hundreds of homes and a school and 
severely damaged another school. In southeast Alabama's Coffee 
County, a tornado slammed into Enterprise High School. Not far 
from the school in Enterprise, an elderly woman was killed by 
flying storm debris. In west Alabama's Wilcox County, the storm 
claimed the life of a Miller's Fairy father who was crushed in 
his home.
    While we will never recover from the loss of life, I'm 
certain that the people of Alabama will work to rebuild even 
stronger communities and I will continue to do everything in my 
power to get them the resources that they need to do so. It 
will take time and resources for the damaged communities to 
begin to heal and erase the scars of this destruction and 
death.
    The people of Alabama--my State--are resilient and have 
already begun cleaning up and planning to rebuild. I saw this 
firsthand when I toured some of the damaged areas this past 
Saturday.
    But how can we ensure that they rebuild safer homes and 
schools to withstand the next storm? I don't have to be a NOAA 
weather forecaster to predict that another devastating storm 
will hit my State again and other States. It's just a matter of 
time.
    Will our citizens be any safer? Hurricanes Ivan, Katrina, 
and Rita showed us how vulnerable we are to natural disasters. 
Last week, we were grimly reminded that we still have a long 
way to go in finding answers to the lessons taught us by those 
hurricanes. Science, technology, and research hold many of 
these answers.
    Today, Admiral, I will be asking for your support and 
guidance on how we can better respond to these natural storms, 
be they hurricanes, tornadoes or what. Last week's storms 
claimed 20 lives from Alabama, Georgia, and Missouri. We cannot 
eliminate severe storms--we know that. But we should envision a 
day when we can live with them more safely.
    Overall, I'm concerned about the health of NOAA's science 
budget. Congress continually receives a budget request from the 
administration that downplays critical science activities when 
compared to the previous year's funding levels. The NOAA 2008 
request is less than what the agency received in 2007, 2006 and 
Madam Chairman, even 2005.
    In past years, the Joint Ocean Commission has clearly and 
objectively laid out the budgetary requirements to better 
support ocean-related science research and education. NOAA's 
budget request boasts a $123 million increase for ocean-related 
activities while the National Science Foundation requests to 
study marine ecosystems and associated human impacts, contains 
only a $17 million increase. These mighty figures represent 
only a fraction of the true budgetary needs for the marine 
community.
    I'm pleased to see that the American competitiveness 
initiative, ACI, has continued to receive support from the 
administration through the National Science Foundation's budget 
request. The ACI will keep the competitive edge that our Nation 
expects in the world economy through research and innovation by 
focusing on the ingenuity of our people and tying our 
capabilities to policies that will keep us at the forefront of 
scientific and technical advancement for generations to come. 
The ACI provides a tremendous opportunity to maintain our 
national technological advantage in a more competitive world.
    I think--I do not think that it goes far enough to take 
advantage of our existing Federal investments, however. The 
funding of ACI includes an increase of $366 million in the 
research and related activities account in NSF. While this 
benefits current research, I'm concerned about what we're doing 
to encourage the next generation of researchers. The long-term 
vision, Madam Chairman, I believe must include increasing 
opportunities for colleges and universities across the country 
to participate in innovation. Many of the funds provided to NSF 
as part of the ACI will go to traditional research schools that 
have historically fared well in retaining its research grants.
    We should find ways to raise the bar of competitiveness, to 
reach out to universities that have not traditionally been 
taken into consideration. We also need to provide the funds to 
increase the level of science education through better 
curriculum and inspiring K through 12 science teachers. NSF is 
the ideal place to begin such a long-term investment for this 
country.
    I'm also concerned about the number of American students 
enrolling in science and engineering fields of study. The most 
recent report from the Council on Competitiveness states that 
foreign students account for most of the growth in Ph.D.s in 
science and engineering, despite the progress being made by 
females and minorities in this area. Our lack of new scientists 
and engineers will eventually become a crisis. We're not 
attracting enough young students into these disciplines and are 
relying too heavily on foreign students. These same students 
return to their homeland where competitive jobs are becoming 
increasingly available.
    To remain at the cutting edge of innovation, I believe we 
need to act now in cultivating our next generation of engineers 
and scientists. There is much untapped potential within our own 
borders. We must make this a priority. The Office of Science 
and Technology Policy states that the goal of the ACI's goal is 
not to introduce entirely new Government programs but to 
increase fundamental research capacity and while there is 
significant Federal investment in research and innovation, 
there should be a much broader vision to include agencies 
beyond those already included in the ACI while not diluting 
current efforts.
    Along those lines, it is discouraging to see that the 
administration wants to see the Nation at the forefront of 
innovation yet chooses to exclude NOAA from the initiative. 
This is perplexing.
    NOAA stands out as an international leader in marine and 
atmospheric science and is a cornerstone of our Nation's 
research community. NOAA's education and outreach activities 
appear to fall directly in line with the ACI's educational 
goals. As I stated here in last week's Department of Commerce 
hearing, I'm concerned why this agency is not recognized as a 
candidate for the ACI program.
    At this point, I want to thank Chairman Mikulski for having 
this hearing today and I look forward to the testimony.
    Senator Mikulski. Thank you very much, Senator Shelby and 
as usual, I'm going to associate myself with your remarks. 
There are two key agencies that have, I believe, been left out 
of the ACI. Certainly NOAA, our flagship agency and on oceans, 
fisheries, and weather as well NASA. The fact that NASA was 
left out of ACI is absolutely stunning. There are two 
colleagues. I'd like to go right to the testimony rather than 
opening statements and you make them then when you get to the 
questions and answers. That way, we can move right along. Does 
that sound good?
    Therefore, let's go right to those who are ready to 
testify. Why don't we start with, Admiral Lautenbacher and go 
to the National Science Foundation?

       SUMMARY STATEMENT OF VICE ADMIRAL CONRAD LAUTENBACHER, JR.

    Admiral Lautenbacher. Madam Chair, Ranking Member Shelby, 
Senator Hutchison, Senator Reed, distinguished staff members, 
thank you very much for this opportunity to testify on behalf 
of the President's fiscal year 2008 budget request for NOAA and 
also thank you for your extremely important leadership in the 
areas that are under NOAA's responsibility. The support of this 
subcommittee has been extremely important to our ability to 
carry out the mission that is required for our country, so 
thank you very much for your continued support of our programs.
    Our programs and services impact one-third of U.S. gross 
domestic product. Our environmental information is vital to the 
competitiveness of our country in the world marketplace and to 
the security and safety of our people here at home. Our 
investments in research and technology contribute to our 
Nation's innovative culture and our work to conserve and manage 
coastal and marine resources ensures economic vitality and 
enhances U.S. trade.
    NOAA has had many notable accomplishments in 2006, some of 
which are mentioned in my written statement. I would like to 
take a moment to just highlight a couple of those before I move 
into the fiscal year 2008 budget request.
    Thanks to the funding from Congress, NOAA was able to 
provide a NOAA weather all-hazards radio to every public school 
in America. That's 97,000 radios. These radios provide 
automatic alerts for severe weather, manmade disasters such as 
chemical spills and terrorist threats as well as Amber Alerts 
for missing children. While tragedies will still occur as they 
did last week with the tornado mentioned by Senator Shelby, 
officials there did receive our warnings on their weather radio 
and actions were taken. Unfortunately, lives were still lost 
but many fewer were lost as a result of the warning and the 
radios and the procedures that were in effect.
    In June, the President designated the northwestern Hawaiian 
Islands as a marine national monument, the largest single act 
of marine conservation in history. Encompassing nearly 140,000 
square miles, the monument includes 4,500 square miles of 
relatively undisturbed coral reef habitat, home to more than 
7,000 species. For the first time, NOAA will play a leading 
role in managing a national monument. This is an exciting and 
important opportunity for NOAA.
    In December, NOAA achieved initial operating capability for 
the expanded U.S. tsunami warning system. This means that the 
most dangerous tsunami generation areas are covered by tsunami 
deepwater buoy stations and last April, the Nation's two 
tsunami warning centers became operational 24 by 7. This 
combination of buoys and around-the-clock warning capability 
has greatly increased the security of the Nation's people 
living along Pacific coastlines.
    Before I highlight the fiscal year 2008 budget request, I 
want to draw your attention to the fact that this year, NOAA is 
celebrating 200 years of science, service, and stewardship. In 
1807, President Thomas Jefferson founded the Survey of the 
Coast to provide nautical charts to the marine community. Safe 
passage of vessels to American ports and along our coastlines 
was critical to increasing trade and building the U.S. economy, 
just as it is today. The Survey of the Coast, along with the 
Weather Bureau founded in 1870, the U.S. Commission on Fish and 
Fisheries in 1871, were brought together in 1970 with the 
establishment of NOAA. We're very proud to be celebrating this 
200-year legacy with Americans across the Nation at events 
throughout the year.
    My written testimony presents the details of the budget as 
it aligns with five priority areas. First of all, sustaining 
critical operations, supporting the U.S. ocean action plan, 
improving weather warnings and forecasts, climate monitoring 
and research, and critical facilities investments. I will just 
highlight a couple of those.

           NOAA deg.FISCAL YEAR 2008 BUDGET REQUEST

    The fiscal year 2008 request, as already stated, is $3.8 
billion. That does represent a $131 million or 3.4 percent 
increase over the President's request from fiscal year 2007 but 
it does represent a $96 million decrease from the fiscal year 
2006 enacted level.
    The budget is able to provide modest new investments in our 
priority areas while maintaining critical services. In critical 
operations, we are providing an increase of $10.1 million for 
operations and maintenance of NOAA vessels and aircraft. NOAA 
is also driving innovation in research and monitoring by 
requesting $3 million in funding to support the further use of 
unmanned aircraft systems or UAS. With this funding, NOAA will 
evaluate the benefits and potential of using UAS to collect 
data crucial for such missions as fishery enforcement, coastal 
zone studies, and hurricane forecasting.
    Continued implementation of the President's ocean action 
plan remains a priority. The fiscal year 2008 budget requests 
$123 million in increase to support the plan, including $60 
million to advance ocean science and research, $38 million to 
protect and restore marine and coastal areas, and $25 million 
to ensure sustainable use of ocean resources.
    Specifically, the request includes $16.4 million for the 
integrated ocean observing system or IOOS for development of 
regional systems and improved data management and 
communications. It also includes $8 million for enforcement and 
management activities in the newly designated Northwestern 
Hawaiian Islands Marine National Monument.
    Funding of $10 million is requested to restore nearly 1,000 
miles of habitat for endangered Atlantic salmon and other fish 
species in New England's largest watershed. Increased funding 
of $3 million will support Klamath River salmon recovery 
projects.
    The fiscal year 2008 budget also provides $20 million in 
increases to support better management of fish harvests. This 
includes $6.5 million in increases to implement the new and 
expanded requirements of the Magnuson-Stevens Fishery 
Conservation and Management Reauthorization Act, passed last 
season. It provides $3 million to establish the regulatory 
framework to facilitate environmentally sustainable commercial 
aquaculture. Our Nation currently has an $8 billion trade 
deficit in seafood. Providing regulatory certainty will foster 
private sector investment in offshore aquaculture, increasing 
the Nation's competitiveness in the world seafood market and 
decreasing our reliance on imported seafood.
    To improve weather warnings and forecasts, we are 
requesting a $5 million increase for the support of operation 
and maintenance of hurricane data buoys and research on 
hurricane intensity that will ultimately save lives. More than 
$23 million is requested to continue strengthening the U.S. 
tsunami warning program, including an increase of $1.7 million 
to deploy additional deep ocean buoy stations.
    Climate monitoring and research includes a $9.4 million 
increase to support the development of an integrated drought 
early warning and forecast system that will also enhance the 
Nation's food security by providing earlier and more accurate 
drought forecasts. More than one-half of this increase will be 
used to research the link between ocean currents and abrupt 
climate change.
    Finally, critical facilities investments include an 
increase of $20 million for the Pacific Regional Center in 
Hawaii, which will bring NOAA's Pacific Island programs 
together in one facility to improve operations and strengthen 
our performance.
    Let me conclude briefly by talking about two oversight 
issues important to the subcommittee and extremely important to 
NOAA. There have been many challenges with our satellite 
programs and the national polar-orbiting operational 
environmental satellite system (NPOESS) in particular. Let me 
assure the subcommittee that I and my staff are doing 
everything we can do to ensure that this program stays on 
track. We have made numerous personnel and organizational 
changes. We are implementing every recommendation from the 
Government Accountability Office (GAO) and Department of 
Commerce inspector general and I meet with the Under Secretary 
of the Air Force and NASA Administrator once a quarter at 
least, to review the program in detail, along with the 
presidents of the companies who have signed the contract to 
develop those satellites. Satellites are complex and risky 
tools but they are vital to all aspects of NOAA's mission. I 
also want to assure the subcommittee that the Department of 
Commerce is in the final stages of updating its communication 
policy, which will ensure for generations into the future that 
our scientists are able to freely and openly communicate their 
science to the media and the public. I have been on the record 
with my scientists numerous times supporting their ability to 
communicate freely their science activities to the public.

                           PREPARED STATEMENT

    Again, I appreciate the opportunity to testify and I am 
happy to answer any of your questions. Thank you.
    [The statement follows:]
      Prepared Statement of Vice Admiral Conrad Lautenbacher, Jr.
    Madam Chairwoman and members of the subcommittee, before I begin my 
testimony I would like to thank you for your leadership and the 
generous support you have shown the National Oceanic and Atmospheric 
Administration (NOAA). Your continued support for our programs is 
appreciated as we work to improve our products and services for the 
American people. Thank you for the opportunity to testify on the 
President's fiscal year 2008 budget request for NOAA.
    The fiscal year 2008 President's budget supports NOAA's priority to 
advance mission-critical services. The fiscal year 2008 request is 
$3.815 billion, which represents a $131 million or 3.4 percent increase 
over the fiscal year 2007 request. This request includes the level of 
resources necessary to carry out NOAA's mission, which is to understand 
and predict changes in the Earth's environment, and conserve and manage 
coastal and marine resources to meet our Nation's economic, social and 
environmental needs. At NOAA we work to protect the lives and 
livelihoods of Americans, and provide products and services that 
benefit the economy, environment, and public safety of the Nation. 
Before I discuss the details of our fiscal year 2008 budget request, I 
would like to briefly highlight some of NOAA's notable successes from 
the past fiscal year (2006).
                    fiscal year 2006 accomplishments
President Designates Largest Fully-Protected Marine Area on Earth
    Recognizing the continuing need for resource protection, President 
Bush designated the Northwestern Hawaiian Islands as a marine national 
monument on June 15, 2006. Encompassing nearly 140,000 square miles, 
the monument covers an area larger than all of our national parks put 
together, including 4,500 square miles of relatively undisturbed coral 
reef habitat that is home to more than 7,000 species. The creation of 
the largest fully-protected marine area in the world is an exciting 
achievement and recognizes the value of marine resources to our Nation.
Successful Launch of NOAA Satellite GOES-13 and New Satellite 
        Operations Facility Ensure Continuity of Improved Data 
        Collection
    On May 24, 2006, officials from NOAA and the National Aeronautics 
and Space Administration (NASA) confirmed that a new geostationary 
operational environmental satellite, designed to track hurricanes and 
other severe weather impacting the Nation, successfully reached orbit. 
Upon reaching final orbit, the satellite was renamed GOES-13. This is 
the first in a new series of satellites featuring a more stable 
platform enabling improved instrument performance. NOAA instruments 
were also launched on the European MetOp-A polar-orbiting satellite in 
October 2006. Combined with NOAA and Department of Defense (DOD) 
operational satellites, MetOp-A will help provide global data for 
improving forecasts of severe weather, disaster mitigation, and 
monitoring of the environment. This launch ushered in a new era of 
U.S.-European cooperation in environmental observing.
    In 2006, NOAA satellite operations and data processing groups began 
moving into the new NOAA Satellite Operations Facility (NSOF). The NSOF 
will house the NOAA satellite command and control functions and data 
and distribution activities that are central to NOAA's mission. The 
NSOF will also house the U.S. Mission Control Center for the Search and 
Rescue Satellite-Aided Tracking (SARSAT) program and the National Ice 
Center (NIC), a joint NOAA/DOD mission to track ice floes and issue 
warnings to the Nation's maritime force. The NSOF will become fully 
operational in Spring 2007.
Enhancements to NOAA's Fleet of Ships and Aircraft
    Significant progress is being made in modernizing NOAA's fleet. 
NOAA took delivery of the Fisheries Survey Vessel (FSV) Henry B. 
Bigelow, the second of 4 new FSV, on July 25, 2006. The Bigelow has 
high-tech capabilities that make it one of the world's most advanced 
fisheries research ships. These ships will be able to perform hydro-
acoustic fish surveys and conduct bottom and mid-water trawls while 
running physical and biological oceanographic sampling during a single 
deployment--a combined capability unavailable in the private sector 
that will enable research and assessment to be carried out with greater 
accuracy and cost efficiency. NOAA also took delivery from the Navy of 
a ``retired'' P-3 aircraft in response to the hurricane supplemental 
bill attached to the fiscal year 2006 Defense appropriations 
legislation. Rehabilitation of the P-3 is expected to be completed by 
the start of the 2008 hurricane season.
Magnuson-Stevens Fishery Conservation and Management Act Reauthorized
    Congress reauthorized the Magnuson-Stevens Fishery Conservation and 
Management Act (MSA) in December, 2006, and it was signed into law by 
President Bush on January 12, 2007. The MSA is the guiding legislation 
that authorizes fishery management activities in federal waters. 
Enactment of this bill was one of the top priorities of the U.S. Ocean 
Action Plan. The reauthorized MSA strengthens NOAA's ability to end 
overfishing, rebuild fish stocks, and work collaboratively on 
conservation.
U.S. Tsunami Warning System Improved
    NOAA designed easy to deploy Deep-ocean Assessment and Reporting of 
Tsunamis (DART)-II technology, which provides two-way communication 
between the buoys and NOAA facilities. This technology allows engineers 
to troubleshoot these systems from the lab and repair the systems 
remotely when possible. This functionality can minimize system downtime 
and save money by not requiring a ship be deployed to make minor 
repairs. The U.S. Tsunami Warning Program also created tsunami impact 
forecast models for nine major coastal communities, providing 
information for inundation maps. With the December 11, 2006 deployment 
of DART #23 in the Western Pacific Ocean, NOAA achieved initial 
operating capability (IOC) of the planned expanded U.S. Tsunami Warning 
Program. NOAA also achieved full 24/7 operations of the Nation's two 
Tsunami Warning Centers. Plans call for the U.S. Tsunami Warning 
Network to total 39 DART-II buoy stations by mid-summer 2008 (32 in the 
Pacific, 7 in the Atlantic).
    NOAA also continued to monitor sea height through a network of 
buoys and tide gauges, collecting information critical to understanding 
the time of arrival and the height of tsunami waves. In 2006, NOAA 
completed the installation of eight new National Water Level 
Observation Network (NWLON) stations to fill gaps in the detection 
network, bringing the 2-year total to 15. The 15 stations were 
installed in California, Oregon, Washington, Alaska, Puerto Rico, and 
the Virgin Islands. These and other new stations brought the NWLON to 
200 stations by the end of calendar year 2006. In addition, NOAA 
continued to upgrade the entire NWLON to real-time status by replacing 
over 50 data collection platforms.
Red Tide Monitoring Protects Human Health and Coastal Economics in New 
        England
    In the wake of the 2005 New England red tide crisis that forced the 
closure of most shellfisheries in the region, NOAA provided additional 
emergency funding in 2006 to provide timely and critical information to 
State managers to build upon long-term research supported by the 
Ecology and Oceanography of Harmful Algal Bloom, and Monitoring and 
Event Response for Harmful Algal Bloom programs at the Woods Hole 
Oceanographic Institution, as well as other partner institutions. In 
the spring of 2006, NOAA-sponsored monitoring detected rapid 
escalations of the bloom, which subsequently closed shellfisheries in 
Massachusetts, New Hampshire and Maine. Additional NOAA efforts allowed 
New England managers to make more strategic sampling and shellfish bed 
closures/openings to protect human health and minimize the economic 
impacts of harmful algal blooms.
National Estuarine Research Reserve System Adds 27th Reserve
    On May 6, 2006, commerce and congressional officials dedicated the 
newest site in the National Estuarine Research Reserve System in Port 
Aransas, Texas, bring the total to 27 reserves. This new reserve 
introduces a new biogeographic area type into the system, and adds 
185,708 acres of public and private land and water. The reserves are 
Federal-State partnerships, where NOAA provides national program 
guidance and operational funding. These reserves serve as living 
laboratories for scientists and provide science-based educational 
programs for students and the public.
Wide Application Potential of Unmanned Aircraft Systems Demonstrated
    In 2006, NOAA worked with federal and private sector partners to 
successfully demonstrate Unmanned Aircraft Systems (UAS) technology. 
NOAA is interested in UAS as a tool to explore and gather data to help 
us reach new heights in our ability to understand and predict the world 
in which we live. Use of UAS could help NOAA achieve our mission goals 
and provide cost-effective means to: enforce regulations over NOAA's 
National Marine Sanctuaries, conduct long endurance flights for 
weather, conduct research over areas that pose significant risks to 
pilots, validate satellite measurements, provide counts of marine 
mammal populations, monitor atmospheric composition and climate, and 
hover above hurricanes and gather critical data for input into 
hurricane models. NOAA will continue to examine how UAS can assist in 
the collection of environmental data.
Protecting Habitat Essential to Fish
    In 2006, over 500,000 square miles of U.S. Pacific Ocean habitats 
were protected from damage by fishing practices, particularly bottom-
trawling. Combined, these areas are more than three times the size of 
all U.S. national parks. The historic protections, implemented by NOAA 
with the support and advice of the regional fishery management 
councils, fishing industry, and environmental groups, made the 
protection of essential fish habitat and deep coral and sponge 
assemblages a significant part of management efforts to conserve 
fisheries in the Pacific Ocean.
NOAA Continues Efforts to Assist with Gulf Coast Recovery Following 
        2005 Hurricanes Katrina and Rita
    In addition to providing the forecasts and immediate response 
assistance in 2005, following Hurricanes Katrina and Rita, NOAA has 
continued to assist with Gulf Coast recovery efforts in fiscal year 
2006.
    NOAA ships and aircraft provided critical response and recovery 
capabilities in the aftermath of Hurricanes Katrina and Rita. NOAA Ship 
Thomas Jefferson completed obstruction surveys in the Gulf of Mexico so 
that busy ports and shipping lanes could be re-opened to traffic. 
NOAA's citation aircraft flew post-storm damage assessment surveys 
along the coasts of the Gulf States. This imagery was downloaded on the 
NOAA website, enabling emergency managers, local officials and average 
citizens to inventory damage and prioritize recovery efforts.
    NOAA mounted a multi-pronged effort to address fishery-related 
impacts in the Gulf of Mexico in fiscal year 2006. In August, 2006, 
NOAA awarded $128 million to the Gulf States Marine Fisheries 
Commission to reseed and restore oyster beds and conduct fisheries 
monitoring in the Gulf. In addition, NOAA Ship Nancy Foster conducted a 
seafood contamination survey for NOAA Fisheries near the Mississippi 
Delta to spot potential safety issues. This research monitored the 
seafood coming in from the Gulf to ensure it was safe for public 
consumption (free of PCBs, pesticides, and fossil fuels).
Collaboration Enables a NOAA Weather Radio to be Placed In Every Public 
        School in America
    NOAA and the Departments of Homeland Security and Education worked 
to get 97,000 NOAA weather radios placed in every public school in 
America to aid in protecting our children from hazards, both natural 
and man-made. In many cases, local weather forecast office staff 
provided expertise in programming the radios to select specific hazards 
and geographic areas for which the school wanted to be alerted. This 
multi-month effort required close collaboration between the Departments 
of Homeland Security, Education, and Commerce (NOAA). This effort 
enabled schools to connect to part of the Nation's Emergency Alert 
System and greatly increases environmental situational awareness and 
public safety.
World Ocean Database 2005
    NOAA's National Oceanographic Data Center (NODC) released a major 
upgrade to its World Ocean Database product. World Ocean Database 2005 
(WOD05) is the largest collection of quality-controlled ocean profile 
data available internationally without restriction. All data are 
available on-line for public use. Data are available for 29 ocean 
variables, including plankton data. The database includes an additional 
900,000 temperature profiles not available in its predecessor. The 
database provides the ocean and climate science communities with 
research-quality ocean profile data sets that will be useful in 
describing physical, chemical and biological parameters in the ocean, 
over both time and space. This database is a crucial part of the 
Integrated Ocean Observing System and the Global Earth Observation 
System of Systems.
New Arctic Observatory Established for Long-Term Climate Measurements
    NOAA's Earth System Research Laboratory in Boulder, Colorado, in 
conjunction with our Canadian counterparts, established a research site 
located on Ellesmere Island to make long-term climate measurements of 
Arctic clouds and aerosols. This observatory supports NOAA's activities 
for the 2007-2008 International Polar Year.
NOAA Scientists Identify Carbon Dioxide Threats to Marine Life
    A report co-authored by NOAA research scientists documents how 
carbon dioxide is dramatically altering ocean chemistry and threatening 
the health of marine organisms. The research also uncovered new 
evidence of ocean acidification in the North Pacific. The report 
resulted from a workshop sponsored by NOAA, the National Science 
Foundation, and the U.S. Geological Survey.
First Operational Satellite Products for Ocean Biology
    In June, 2006, NOAA began to process and distribute ocean biology 
products for U.S. coastal waters, using satellite observations. This 
activity represents a successful transition of NASA research to NOAA 
operations. These products (e.g. chlorophyll concentration) represent 
the first satellite-derived biological products generated by NOAA for 
coastal and open ocean waters. These products are useful in detecting 
and monitoring harmful algal blooms, assessing regional water quality, 
and locating suitable habitat for fish and other important marine 
species. Development of these products prepares NOAA for generating and 
distributing ocean biology products in the global ocean after 2010.
               fiscal year 2008 budget request highlights
Supporting the U.S. Ocean Action Plan
    Coastal and marine waters help support over 28 million jobs, and 
the value of the ocean economy to the United States is over $115 
billion. The commercial and recreational fishing industries alone add 
over $48 billion to the national economy each year. The fiscal year 
2008 President's budget requests $123 million in increases for NOAA to 
support the President's U.S. Ocean Action Plan. This oceans initiative 
includes $38 million to protect and restore marine and coastal areas, 
$25 million to ensure sustainable use of ocean resources, and $60 
million to advance ocean science and research.
    New investments in ocean science are aimed at monitoring and better 
understanding marine ecosystems. Increased funding of $16 million is 
included for the Integrated Ocean Observing System to enhance models 
and information products through development of regional systems and 
improved data management and communications. A total increase of $20 
million is provided for NOAA research on four near-term priorities 
established through the national Ocean Research Priorities Plan. An 
additional $8 million will support exploring and defining areas of the 
continental shelf that are adjacent to, but currently outside of, U.S. 
jurisdiction. This work will enable a U.S. claim to these areas and the 
potential $1.2 trillion worth of resources they are estimated to 
contain.
    The fiscal year 2008 President's budget builds on NOAA's strong 
record of investing in projects that embody the spirit of cooperative 
conservation. Projects to protect and restore valuable marine and 
coastal areas include funding of $8 million for enforcement and 
management activities in the recently designated Northwestern Hawaiian 
Islands Marine National Monument, and $10 million for a project to 
restore nearly 1,000 stream miles of habitat for endangered Atlantic 
salmon and other fish species. A total of $15 million is provided for 
the Coastal and Estuarine Land Conservation Program, to assist State 
and local partners in the purchase of high priority coastal or 
estuarine lands or conservation easements. Increased funding of $3 
million is also included to support Klamath River salmon recovery 
projects. Finally, an increase of $5 million will support competitive 
grant programs focused on the Gulf of Mexico Alliance coastal resource 
priorities, as identified in the Governors' Action Plan for Healthy and 
Resilient Coasts.
    Finally, the fiscal year 2008 NOAA budget provides support to 
ensure sustainable access to seafood through development of offshore 
aquaculture and better management of fish harvests. The administration 
will propose legislation to establish clear regulatory authority and 
permitting processes for offshore aquaculture. An increase of $3 
million is included to establish the regulatory framework to encourage 
and facilitate development of environmentally sustainable commercial 
opportunities. In addition, $20 million in increases are provided to 
improve management of fish harvests, including $6.5 million in 
increases to implement the new and expanded requirements of the 
Magnuson-Stevens Fishery Conservation and Management Reauthorization 
Act of 2006, $3 million for observer programs, and $6 million for 
market-based approaches to fisheries management. Market-based 
approaches--such as Limited Access Privilege Programs (LAPPs) that 
provide exclusive privileges to harvest a quantity of fish--move 
fisheries management away from cumbersome and inefficient regulatory 
practices and have been shown to lead to lengthened fishing seasons, 
improved product quality, and safer conditions for fishermen. The 
administration has set a goal of doubling the number of LAPPs in use by 
the year 2010, and the increased funding of $6 million for LAPPs in 
this request supports that goal. Finally, an additional $2 million in 
funding is provided to meet the management challenges of assessing and 
mitigating the impacts of sound from human activities, such as national 
defense readiness and energy exploration and development, on marine 
mammals.
Sustaining Critical Operations
    As always, I support NOAA's employees by requesting adequate 
funding for our people, infrastructure, and facilities. NOAA's core 
values are science, service, and stewardship, as well as people, 
ingenuity, integrity, excellence, and teamwork. Our ability to serve 
the Nation and accomplish the missions outlined below is determined by 
the quality of our people and the tools they employ. Our facilities, 
ships, aircraft, environmental satellites, data-processing systems, 
computing and communications systems, and our approach to management 
provide the foundation of support for all of our programs. 
Approximately $54.6 million in net increases will support our workforce 
inflation factors, including $44.9 million for salaries and benefits 
and $6.6 million for non-labor related adjustments such as fuel costs.
    This year, we focus on the operations and maintenance of NOAA 
vessels and necessary enhancements to marine safety, facility repair, 
and modernization. A funding increase of $8.3 million will be used to 
support marine operations and equipment, including $5.6 million for new 
vessel operations and maintenance and $1.7 million to implement a more 
effective maritime staff rotation and safety enhancements. This funding 
will support the operations maintenance for the Okeanos Explorer, 
NOAA's first dedicated ocean exploration vessel. Increased funding of 
$5.5 million will support operations and maintenance for NOAA's third 
P-3 aircraft. NOAA is also moving forward this year with increases in 
funding for unmanned vehicles, with $0.7 million in support of 
Autonomous Underwater Vehicles (AUV) and an increase of $3 million in 
funding to support the further use of Unmanned Aircraft Systems (UAS). 
With this increase, NOAA will evaluate the benefits and potential of 
using UAS to collect data crucial for climate models, weather research, 
fisheries enforcement, and coastal zone studies.
    The backbone of the NOAA infrastructure is our integrated Earth 
observation effort. NOAA, NASA and the Office of Science and Technology 
Policy (OSTP) serve as the lead agencies for the Federal Government in 
developing our U.S. integrated Earth observing strategy. In addition, I 
serve as one of four intergovernmental co-chairs of the effort to 
develop the Global Earth Observation System of Systems. Building and 
maintaining state of the art satellite programs is an important 
component of NOAA's integrated observation efforts. An increase of $25 
million in the Polar Operational Environmental Satellite (POES) program 
continues support for development and acquisition of polar-orbiting 
weather satellites to improve weather forecasting and our understanding 
of the climate. This increase will allow NOAA to complete acquisition 
of this series of polar satellites and install and maintain instruments 
important to U.S. Government interests on the European MetOp partner 
satellite. Following the completion of the POES program, it will be 
replaced by the tri-agency National Polar-orbiting Operational 
Environmental Satellite System (NPOESS). This transition is expected in 
2013. We will continue to partner with the Europeans on their MetOp 
satellite as NPOESS replaces our current POES satellites.
Improving Weather Warnings and Forecasts
    Severe weather events cause $11 billion in damages and 
approximately 7,000 weather-related fatalities yearly in the United 
States. Nearly one-third of the economy is sensitive to weather and 
climate. Realizing this, NOAA seeks to provide decisionmakers with key 
observations, analyses, predictions, and warnings for a variety of 
weather and water conditions to help protect the health, lives, and 
property of the United States and enhance its economy. Increased 
funding of $2 million will accelerate research to improve hurricane 
intensity forecasts through targeted research for new models and 
observations. Another $3 million will support the operations and 
maintenance of 15 hurricane data buoys in the Caribbean, Gulf of 
Mexico, and the Atlantic Ocean. Finally, NOAA continues to strengthen 
the U.S. Tsunami Warning Program with an increase of $1.7 million to 
deploy additional deep ocean buoy (DART) stations. Strengthening the 
U.S. Tsunami Warning Program provides effective, community-based 
tsunami hazard mitigation actions including required inundation flood 
mapping, modeling, forecasting efforts and evacuation mapping, and 
community-based public education/awareness/preparedness for all U.S. 
communities at risk.
Climate Monitoring and Research
    Society exists in a highly variable climate system, and major 
climatic events can impose serious consequences on society. The fiscal 
year 2008 budget request contains investments in several programs aimed 
at increasing our predictive capability, enabling NOAA to provide our 
customers (farmers, utilities, land managers, weather risk industry, 
fisheries resource managers and decisionmakers) with assessments of 
current and future impacts of climate events such as droughts, floods, 
and trends in extreme climate events. NOAA is building a suite of 
information, products and services to enable society to understand, 
predict, and respond to changing climate conditions. These activities 
are part of the U.S. Climate Change Science Program and are being 
conducted in collaboration and coordination with our important 
interagency partners including NASA, NSF, and the Department of Energy. 
We will continue to expand and improve access to global oceanic and 
atmospheric data sets for improved climate prediction and development 
of climate change indicators. NOAA will support the critical National 
Integrated Drought Information System with increases of $4.4 million to 
develop an integrated drought early warning and forecast system to 
provide earlier and more accurate forecasts of drought conditions. This 
request also supports the administration's efforts to create a U.S. 
Integrated Earth Observation System. With an increase of $0.9 million, 
we will support research on water vapor to refine climate models. In 
support of the Ocean Research Priorities Plan, NOAA will enhance our 
understanding of the link between ocean currents and rapid climate 
change with an increase of $5 million in support of research on this 
topic. Finally, an additional $1 million in funding will provide 
additional computational support for assessing abrupt climate change.
Critical Facilities Investments
    The fiscal year 2008 President's budget request also includes 
important increases for critical facilities, necessary to provide a 
safe and effective working environment for NOAA's employees.
    Of particular importance this year is the $3 million funding 
increase to begin design of a replacement facility at the La Jolla 
Southwest Fisheries Science Center. NOAA is also requesting $20.3 
million for continued construction of the new Pacific Region Center on 
Ford Island in Honolulu, Hawaii. This increase in funding will allow 
NOAA to complete the exterior renovation of one of the Ford Island 
buildings, a crucial next step in the construction process.
                               conclusion
    NOAA's fiscal year 2008 budget request provides essential new 
investments in our priority areas while maintaining critical services, 
reflecting NOAA's vision, mission, and core values. The work NOAA 
accomplished in 2006 impacted every U.S. citizen. We will build on our 
successes from last year, and stand ready to meet the challenges that 
will surface in fiscal year 2008 and beyond. NOAA is dedicated to 
enhancing economic security and national safety through research and 
accurate prediction of weather and climate-related events, and to 
providing environmental stewardship of our Nation's coastal and marine 
resources. That concludes my statement, Madam Chairwoman. Thank you for 
the opportunity to present NOAA's fiscal year 2008 budget request. I am 
happy to respond to any questions the committee may have.

                      NATIONAL SCIENCE FOUNDATION

STATEMENT OF DR. ARDEN BEMENT, JR., DIRECTOR
    Senator Mikulski. Dr. Bement.
    Dr. Bement. Yes, thank you, Chairman Mikulski, Senator 
Shelby, Senator Hutchison, and Senator Reed. I am pleased to 
present the National Science Foundation's (NSF) budget for the 
next fiscal year. Before I begin, however, I must express my 
heartfelt appreciation for your support of NSF's research 
budget in the fiscal year 2007 continuing resolution.
    The President's request for NSF is $6.43 billion for fiscal 
year 2008. This represents a $513 million or 8.7 percent 
increase over the continuing resolution. Funding at this level 
will keep NSF on a course set by the President's American 
competitiveness initiative to drive innovation and sharpen 
America's competitive edge.
    Let me just quickly highlight some of the activities we are 
emphasizing in the new budget. As the lead agency supporting 
polar research, NSF will invest $59 million for international 
polar year (IPY) activities. Climate change research and 
environmental observations will be a major focus of 
investigation. The outlines of environmental change from sea 
ice extent and retreating glaciers to shifting patterns in 
flora and fauna are already visible in the polar regions, with 
implications for the rest of the globe. Another research effort 
will be to explore how life adapts to and survives in the polar 
extremes. Other major thrusts during IPY will be education and 
outreach activities.
    The budget includes an important new NSF-wide investment of 
$52 million to develop a next generation of computationally 
based discovery concepts and tools to deal with complex, data 
rich, and interacting systems. Cyber-enabled discovery and 
innovation aims to explore radically new concepts, approaches 
and tools at the intersection of computational and physical or 
biological worlds to address such challenges.
    Understanding how human activity interacts with the oceans 
can help ensure that the world's oceans remain clean, healthy, 
productive, and stable. NSF will invest $17 million in four 
research areas identified in the ocean research priorities plan 
as critical near-term priorities, the complex dynamics that 
control and regulate marine ecosystem processes, variability of 
Atlantic Ocean currents, the response of coastal ecosystems to 
a variety of natural events and human influence processes and 
the development of new sensors for marine ecosystems.
    Our request also includes $390 million for nano-technology 
research. NSF's investment in the interagency national nano-
technology initiative will increase by nearly $17 million. We 
will increase our multidisciplinary and interagency regulatory 
support efforts that address the environmental health and 
safety impacts of nano materials by exploring how nano 
particles and materials interact with the living world at all 
scales.
    NSF will increase support by $8 million for the 
experimental program to stimulate competitive research 
(EPSCoR). EPSCoR investments provide strategic programs and 
opportunities for participants in States that have historically 
received less Federal R&D funding to make sustainable 
improvements in research capacity and national research 
competitiveness.
    We moved EPSCoR to the Office of the Director in order to 
focus on the research potential and capacity of these States 
and to integrate this activity across NSF.
    Creating a strong science and engineering workforce for the 
future is vital to maintaining the Nation's competitive edge. 
NSF will continue to fund a broad portfolio of successful 
programs that contribute to this goal: CAREER, aimed at junior 
faculty, advanced technological education aimed at 2 year 
colleges, Noyce Scholarships for promoting the development of a 
world-class math and science teaching corp and programs which 
aim to broaden participation of underrepresented groups and 
engage a broader spectrum of institutions such as the STEM 
Talent Expansion Program and Centers for Research Excellence in 
Science and Technology.
    We will fund an additional 200 graduate research 
fellowships, increasing the total number of students supported 
to nearly 3,000.
    In coordination with the Department of Education, NSF will 
continue funding for the highly successful Math and Science 
Partnership Program aimed at improving K to 12 science and math 
education and teaching. In addition to supporting ongoing 
awards, approximately $30 million will be available for new 
awards in fiscal year 2008.
    Scientists, engineers, and students need world-class 
instruments with the best capabilities, the farthest reach, and 
the finest accuracy. NSF proposes an investment of $32.75 
million to initiate advanced LIGO, a gravitational wave 
observatory that will improve detection rates by a factor of 
1,000 over current Earth-based facilities. Observations made 
with this instrument could revolutionize our understanding of 
the universe.
    The development of a petascale computing capability and 
world-class cyber-infrastructure will continue to be a high 
priority. These investments will significantly augment 
computational and networking capabilities available to 
scientists and engineers in all disciplines.
    The Foundation strategy for research and education must be 
to keep all fields and disciplines of science and engineering 
healthy and strong. At the same time, we must be constantly 
alert to research that has the potential to transform the 
world. This is the kind of research that can overturn accepted 
paradigms and open entirely new fields for exploration.
    The National Science Foundation looks to the future with 
these important considerations in mind and we have crafted our 
fiscal year 2008 budget to address them.

                           PREPARED STATEMENT

    Madam Chairman, thank you for the opportunity to present a 
brief overview of our request and I look forward to any 
questions you may have.
    [The statement follows:]
             Prepared Statement of Dr. Arden L. Bement, Jr.
    Chairman Mikulski, Senator Shelby, and members of the committee, I 
am pleased to present the National Science Foundation's budget for the 
next fiscal year. Before I begin, I must express my heartfelt 
appreciation for your support of NSF's research budget in the Fiscal 
Year 2007 Continuing Resolution.
    The President's request for NSF is $6.43 billion for fiscal year 
2008. This represents a $513 million or 8.7 percent increase over the 
continuing resolution. Funding at this level will keep NSF on the 
course set by the President's American Competitiveness Initiative to 
drive innovation and sharpen America's competitive edge.
    Let me just quickly highlight some of the activities we are 
emphasizing in the new budget. As the lead agency supporting polar 
research, NSF will invest $59 million for International Polar Year 
activities. Climate change research and environmental observations will 
be a major focus of investigation. The outlines of environmental 
change, from sea ice extent and retreating glaciers, to shifting 
patterns in flora and fauna, are already visible in the polar regions, 
with implications for the rest of the globe. Another research effort 
will be to explore how life adapts to and survives in the polar 
extremes. Other major thrusts during IPY will be in education and 
outreach activities.
    The budget includes an important new NSF-wide investment of $52 
million to develop a new generation of computationally based discovery 
concepts and tools to deal with complex, data-rich, and interacting 
systems. Cyber-enabled Discovery and Innovation aims to explore 
radically new concepts, approaches, and tools at the intersection of 
computational and physical or biological worlds to address such 
challenges.
    Understanding how human activity interacts with the oceans can help 
ensure that the world's oceans remain clean, healthy, productive, and 
stable. NSF will invest $17 million in four research areas identified 
in the Ocean Research Priorities Plan as critical near-term priorities: 
the complex dynamics that control and regulate marine ecosystem 
processes; variability of Atlantic Ocean currents; the response of 
coastal ecosystems to a variety of natural events and human influenced 
processes; and the development of new sensors for marine ecosystems.
    Our request also includes $390 million for nanotechnology research. 
NSF's investment in the interagency National Nanotechnology Initiative 
will increase by nearly $17 million. We will increase our 
multidisciplinary and interagency regulatory support efforts that 
address the environmental, health, and safety impacts of nanomaterials 
by exploring how nano particles and materials interact with the living 
world at all scales.
    NSF will increase support by $8 million for the Experimental 
Program to Stimulate Competitive Research (EPSCoR). EPSCoR investments 
provide strategic programs and opportunities for participants--
jurisdictions and States that have historically received less Federal 
R&D funding--to make sustainable improvements in research capacity and 
national research competitiveness. We moved EPSCoR to the Office of the 
Director in order to focus on the research potential and capacity of 
these States and to integrate this activity across NSF.
    Creating a strong science and engineering workforce for the future 
is vital to maintaining the Nation's competitive edge. NSF will 
continue to fund a broad portfolio of successful programs that 
contribute to this goal: CAREER, aimed at junior faculty; Advanced 
Technological Education, aimed at 2-year colleges; Noyce Scholarships, 
for promoting the development of a world-class math and science 
teaching corps; and programs which aim to broaden participation of 
underrepresented groups and engage a broader spectrum of institutions, 
such as the STEM Talent Expansion Program and Centers for Research 
Excellence in Science and Technology. We will fund an additional 200 
Graduate Research Fellowships, increasing the total number of students 
supported to nearly 3,000.
    In coordination with the Department of Education, NSF will continue 
funding for the highly successful Math and Science Partnership program, 
aimed at improving K-12 science and math education and teaching. In 
addition to supporting ongoing awards, approximately $30 million will 
be available for new awards in fiscal year 2008.
    Scientists, engineers, and students need world-class instruments 
with the best capabilities, the farthest reach, and the finest 
accuracy. NSF proposes an investment of $32.75 million to initiate 
Advanced LIGO, a gravitational wave observatory that will improve 
detection rates by a factor of 1,000 over current earth-based 
facilities. Observations made with this instrument could revolutionize 
our understanding of the universe.
    The development of a petascale computing capability and world-class 
cyber-infrastructure will continue to be a high priority. These 
investments will significantly augment computational and networking 
capabilities available to scientists and engineers in all disciplines.
    The foundation's strategy for research and education must be to 
keep all fields and disciplines of science and engineering healthy and 
strong. At the same time, we must be constantly alert to research that 
has the potential to transform the world. This is the kind of research 
that can overturn accepted paradigms and open entirely new fields for 
exploration. The National Science Foundation looks to the future with 
these important considerations in mind, and we have crafted our fiscal 
year 2008 budget to address them.
    Madam Chairman, thank you for the opportunity to present a brief 
overview of our request. I look forward any questions you might have.

   NOAA deg.NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION 
                        TSUNAMI WARNING PROGRAM

    Senator Mikulski. Thank you very much for your excellent 
testimony. I'm going to get right to a couple of the questions 
that I know are pressing in my mind and one is the whole idea--
I know of the--kind of the mantra, if you will, of NOAA, saving 
lives and saving livelihoods. I just want to note the early 
part of your testimony about early warning for weather. The 
school alerts. Admiral, I think this is an example of what NOAA 
develops, works with the private sector then with the larger 
public sector, truly that develops products, creates jobs, and 
saves lives and saves livelihoods.
    My question then to you is, I'd like to go right to weather 
warning systems. In this year's budget, you have a set of 
requests for ensuring the tsunami warning system. We all note 
when the terrible tsunami hit Indonesia and other parts of the 
Pacific, the world was alarmed and wondered what it would mean 
to Hawaii, to other places in the Pacific rim. Could you tell 
us the status of where you are on the tsunami warning and could 
you also tell us where we are in terms of having enough 
resources to implement that because this Pacific is pretty big 
and what about, also the east coast?

                NOAA deg.TSUNAMI WARNING SYSTEM

    Admiral Lautenbacher. Yes, thank you. I'd be happy to. 
First of all, it's a result of the request that we turned in, 
the strong support of Congress to provide the money and the 
authorization for us to do this work. We have right now in 
place 25 deep-water buoys that are spaced around the Pacific 
and into the South Pacific as well as the Atlantic and the 
Caribbean area to provide warnings for the gulf coast and east 
coast.
    So that represents an increase from 6 to 25. We had six 
experimental buoys in the water at the time of the Indonesian 
earthquake, buoys off of Alaska and off of the Aleutian Islands 
and off of the west coast. We now have 25 of these deepwater 
buoys to protect us from all directions. Thanks to funding from 
Congress, we also have 24 by 7 coverage, so we have people on 
duty at the warning centers around the clock that provide those 
warnings. We are equipped today to provide the warnings to the 
Atlantic, to the Pacific and Pacific rim and we now have, from 
our international efforts, a buoy in the Indian Ocean and we 
are working to provide the coverage for the Indian Ocean for a 
worldwide system. We're also building more interest, I think, 
from communities to become tsunami ready. We've had 10 to 20 
new communities join that program.
    Senator Mikulski. Do you have enough? In looking at this 
year's appropriations to keep the tsunami program on track?
    Admiral Lautenbacher. We do. If we are allowed the increase 
of the $1.7 million, that will provide us the ability to 
complete the program and to maintain the continuity of it into 
the future.

         NOAA deg.SUSQUEHANNA BASIN MONITORING SYSTEM

    Senator Mikulski. Something that is very important to us in 
the Northeast, is the Susquehanna River Basin, which stretches 
from upstate New York, goes through Pennsylvania, touches a bit 
on Delaware but mostly New York and Pennsylvania and comes into 
Maryland and converges at a place at Port Depost, that without 
this Susquehanna warning system, could have tremendous loss of 
lives and an inability to manage it. I understand that the 
Susquehanna Basin monitoring system needs upgrading but it is 
never included in the budget. Can you tell me where we are on 
that and we do know it needs to be modernized. It was 
originally put into play in the 1960s and technology has 
changed and the weather has gotten more severe.
    Admiral Lautenbacher. It does need to be modernized. We 
work with the United States Geological Survey (USGS) to try to 
ensure that there is funding in those areas. Many of our 
systems need improvement for monitoring of streams. We have 
some programs to improve the technological capability of these 
monitoring stations. Our AHPS Program, which is the advanced 
hydrological prediction system, makes use of these gauges so 
we've made some increases but more remains to be done in that 
regard.
    Senator Mikulski. I would really like, as part of the 
excellent work that you're already doing, to include funding 
for this. We're talking about maybe $2 or $3 million that 
impact four States and billions of dollars of private property 
and impacting also on Aberdeen Proving Ground. And I would 
really like you to take a look at that as we move through this 
and look ahead.

NOAA deg.NATIONAL ACADEMY OF SCIENCES REPORT ON CLIMATE CHANGE

    Let me get then to the whole issue of climate change, 
studying our planet and also the oceans. The National Academy 
of Sciences has issued a report encouraging that NASA and NOAA 
sign a memorandum of agreement and follow about 17 different 
projects to really coordinate and have a synergistic leveraging 
effect on Earth science and encourage this. Have you had a 
chance to review this document? Your reaction to this document? 
Where is this heading with Dr. Griffin and where would this be 
in this budget because again, following the reports of a 
National Academy, which means it has been peer reviewed 
recommendations. It's not what anyone of us wants but it seems 
like it would really leverage what we need to know and play a 
major role in climate change.
    Admiral Lautenbacher. It's a very important study and it 
was one that was chartered and supported, obviously, by NASA 
and NOAA. I have read the report. I agree with the thrust of 
the report. Right now, both within NOAA and NASA, we are going 
through the detailed recommendations and looking at ways that 
we can bring them into effect. It's an important study for us, 
for both agencies. I have talked with Dr. Griffin about it and 
we take it very seriously. It did not come out in time to 
affect the fiscal year 2008 budget but it is going to be an 
important factor as we go through this year developing it.
    Senator Mikulski. Well, NASA itself is under tremendous 
stress, as my colleagues here at the table would attest to, 
from exploration, completing the space station as well as 
science and we work very closely together but in order to 
leverage every nickel from every agency, to accomplish a 
science budget, I think it's really important that NOAA and 
NASA will get at how they can literally leverage each other, 
particularly in the science area, while we look at completing 
the very important responsibilities for this station and a crew 
return vehicle. So we've got a lot here that we're juggling, 
including my time.
    I have other questions. We haven't forgotten the NSF. It 
shows you how important this hearing is. Senator Shelby, I'll 
turn to you.

         NOAA deg.AMERICAN COMPETITIVENESS INITIATIVE

    Senator Shelby. Thank you, Madam Chairman. As I mentioned 
in my opening statement, Admiral, I'm concerned that NOAA was 
noticeably excluded from the American competitive initiative, 
the ACI program. NOAA stands out as an international leader in 
marine and atmospheric science. We all know that and it's in 
line with other advanced science agencies that are part of ACI. 
Admiral, from what you know of ACI and I think it's a lot, what 
aspects of NOAA do you feel have the potential to be part of 
this innovative program?
    Admiral Lautenbacher. I thank you, Senator Shelby. I think 
that we are part of the American competitiveness initiative. 
Obviously, not in the funding arena as most people know----
    Senator Shelby. Well, you are and you're not but go ahead.
    Admiral Lautenbacher. We are and we're not and the issue 
was to talk about basic research. NOAA doesn't have a 
definition of basic research so there is an issue with that. 
But we do have a substantial and very important R&D budget of 
around $500 million, depending on what categories you use and 
we are absolutely essential for the competitiveness of our 
economy. As I pointed out, one-third of our GDP depends on the 
kinds of environmental information that make our country 
competitive in a variety of industries.
    We have looked very carefully at things like aquaculture. 
Here's an area where we need to be innovative. We are, in fact, 
going to try to partner with the National Institute of 
Standards and Technology (NIST), to leverage some of the money 
that is in that budget because an $8 billion trade deficit is 
an important area of our economy so we are looking to try to 
provide more innovation in building the kinds of tools for 
sustainable aquaculture, for doing it in an environmentally 
sensitive way. We're looking at trying to be innovative, given 
the importance of the satellites.
    We have taken the newest instruments that NASA has 
developed and have figured out how to assimilate them into our 
weather models and our climate models so we're getting right on 
the front edge of research to ensure that it provides benefit 
for the country. We are asking this year to experiment and use 
unmanned aircraft to help us gain more information. The Arctic 
is a region that would be very useful for us to work in with 
these kinds of instruments and certainly, severe weather. 
Hurricanes, storms at sea and that sort of thing. Phased array 
radar--as we talked about trying to increase the warning times. 
Remember that in 1985, our warning time for tornadoes was 
negative. It was minus 2 minutes to warn people about 
tornadoes. Today, it's an average of 13 minutes or so and the 
Enterprise, Alabama tornado was a warning time of about 18 
minutes. That's because of the technology innovation that has 
been created from our research.
    We're looking now towards dual polarization radar systems 
that will help improve that warning time and in the future, we 
have a program for phased array radars. These are the radars 
that the Navy has on their ships at sea, which could double for 
Federal Aviation Administration (FAA) types of radars as well 
as allow us to gain significant advantage in the warning time 
that may save more lives. So those are a few of the things that 
we're working on and there are many others, Senator. Thank you 
for the question.

 NSF deg.NATIONAL SCIENCE FOUNDATION'S EDUCATION PROGRAMS AND 
                  AMERICAN COMPETITIVENESS INITIATIVE

    Senator Shelby. Dr. Bement, as I mentioned in my opening 
statement, the ACI provides substantial dollars on the research 
side of the National Science Foundation (NSF), yet hardly 
touches the education efforts at NSF. One of the goals of the 
ACI as well as the Augustine report, is to develop a sustained 
pipeline of highly trained U.S. students in scientific fields. 
You're very aware of this. I'm disappointed that the potential 
for educating our students to be the scientists and engineers 
of the future has not been a highlight of NSF's portion of the 
ACI. Can you take this opportunity here today to talk about the 
program, such as the math and science partnerships, HBCU and 
other K through 12 programs where NSF can achieve the goals our 
country needs to stay on the cutting edge and remain 
competitive?
    Dr. Bement. Thank you for that question, Senator Shelby. 
Obviously I feel very strongly about education because 
educating the workforce of the 21st century is a major goal of 
the ACI.
    Senator Shelby. It's the key to our survival economically 
and our standard of living, isn't it?
    Dr. Bement. Absolutely. And you know, throughout all of our 
programs, even our research programs, we include education 
components, because those who do the research are graduate 
students who eventually move into the private sector or 
academia and become the leaders of our innovation system. So 
it's critically important and we try to keep our program in 
balance at all levels, K to 12, undergraduate and graduate 
education. The 2008 request was structured at the time that the 
Academic Competitiveness Council was formed in response to the 
Deficit Reduction Act of 2005 and the sense of that legislation 
was that programs should be increased on the basis of rigorous 
evaluation and evidence that they were meeting their goals.
    All of our programs are evaluated. Some were evaluated at 
the time the budget was formulated. Some are scheduled for 
evaluation this year and next year. You'll note in our budget 
that the programs that had been shown effective were plus-ed up 
significantly by 10 percent or more. There were some that were 
flat funded, pending evaluation this year and next and 
hopefully those budgets will increase after they are shown to 
be effective.

   NOAA deg.NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION 
                       DISASTER RESPONSE CENTERS

    Senator Shelby. In recent years, NOAA has greatly improved, 
as we know, the timeliness of severe weather warnings. You just 
mentioned this and I think you will continue to make progress 
there. It saves lives. Yet despite this warning, many lives are 
still lost as we know this last week. Effectively safeguarding 
our citizens from natural disasters involves more than just 
improving warning times. It requires better education, better 
planning, better infrastructure, and better emergency response. 
Does it not? I will--you said yes, didn't you?
    Admiral Lautenbacher. Yes, absolutely.
    Senator Shelby. Last year, NOAA explored the viability of 
having a Disaster Response Center on the gulf coast, a NOAA 
center that can effectively respond to weather and marine 
disasters as well as serve as a focal point for innovative 
research that prevents future storms from inflicting such 
deadly results in the gulf. I think it is necessary. In your 
opinion, what would such a gulf center need to effectively meet 
the full spectrum needs of mitigating disaster response before, 
during, and after these weather events? Because they will 
occur.
    Admiral Lautenbacher. Yes, sir. They will occur. And we 
found out that we didn't have a really coordinated response 
effort to Katrina. I'm very proud of what we did in the gulf in 
restoring and providing our services down there but the object 
of having a node that is in the area that has a trained staff, 
that has the kind of the facilities that are available in an 
area that is close enough to bring them together.
    Senator Shelby. Does that make a lot of sense?
    Admiral Lautenbacher. It makes a lot of sense and we are 
working on regional types of initiatives within NOAA and this 
region would be obviously very critical to us.
    Senator Shelby. Thank you.
    Senator Mikulski. Excellent point. Senator Reed, from an 
ocean State?

              NOAA deg.REGIONAL FISHERIES COUNCIL

    Senator Reed. Thank you very much, Madam Chairman and let 
me first thank Admiral Lautenbacher for the decision by NOAA to 
evaluate Rhode Island for the home port for the Okeanos 
Explorer, which is a ship that will be, I think, very, very 
useful in terms of your mission and also for the proposed 
increase in funding for ocean exploration in this budget. Thank 
you very much.
    Let me turn, Admiral, to a question about the Regional 
Fisheries Council. Since 1977, the budgets for these councils 
increased about 25 percent whereas the National Marine 
Fisheries Service (NMFS) budget went up about 225 percent. 
We're asking the councils to do more and more with the Magnuson 
Act reauthorization. Could you tell if there is going to be a 
funding increase in this budget for regional fisheries 
councils?
    Admiral Lautenbacher. There is an increase and it is a 
modest increase based on the increment that I was able to get 
for the Magnuson-Stevens reauthorization, so part of the 
funding that we've talked about there is going to improve the 
science, and the support that each of these fishery management 
councils must use to meet the requirements of this bill. It's 
important to us to maintain fishery councils that are capable 
of doing the work.
    Senator Reed. It seems that they have more responsibilities 
but the resources aren't concomitant with that responsibility, 
is that fair?
    Admiral Lautenbacher. I would say that it has been 
difficult over the years, to keep pace with the increasing 
administrative and scientific requirements. I'm very sensitive 
to it and would like to do more in that area.

 NOAA deg.NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION SEA 
                             GRANT PROGRAM

    Senator Reed. Thank you. The NOAA Sea Grant Program, for 
years, has been the mainstay of a great deal of research. In 
fact, I think at the University of Rhode Island is one of your 
largest programs and the program took a significant cut in 
fiscal year 2006 and the President's budget this year is simply 
a repeat, about $55 million. With increased discussion of ocean 
research, hurricane effects, tidal issues, all these things, 
why can't we do more with respect to sea grant funding?
    Admiral Lautenbacher. Well, quite frankly, I would like to 
see a larger sea grant budget. We were very sensitive to the 
congressional compromise, I guess, at the level that we have 
today so I'd like to keep working on trying to build the sea 
grant budget but looking at the lay of the land and the 
priorities and what would be supported at levels we have today, 
continuing the congressional appropriated level was felt to be 
the best approach, given the resources that we have.
    Senator Reed. Now, one following question--I understand 
National Marine Fisheries Service put out a request for funding 
proposals for research and those proposals were presented--at 
least offered to sea grant programs but I understand they are 
being offered to consulting firms instead of the sea grant 
programs. Is there a reason why the sea grant program wasn't 
used?
    Admiral Lautenbacher. NOAA offers numerous funding 
opportunities that directly relate to our core mission, 
including grants for cooperative research. In June and December 
2006, NOAA published in the Federal Register Omnibus notices of 
consolidated sources of program and application information 
related to its competitive grant and cooperative agreement 
award offerings for fiscal year 2007. In addition, in February 
2007 NOAA augmented the Omnibus notices by publishing in the 
Federal Register a Broad Area Announcement (BAA) to request 
proposals for special projects and programs associated with the 
agency's strategic plan and mission goals as a mechanism to 
encourage research, technical projects, or sponsorships that 
are not normally funded through our competitive discretionary 
programs. While each grants program has specific guidelines 
regarding eligibility, in general, researchers at Sea Grant 
colleges are free to compete for NOAA funding.

NSF deg.EXPERIMENTAL PROGRAM TO STIMULATE COMPETITIVE RESEARCH

    Senator Reed. Thank you, sir. Dr. Bement, thank you for 
your testimony and for your leadership and you mentioned 
EPSCoR--that's to us a very important program. We fought hard 
to get EPSCoR into Rhode Island and the thought was and I think 
the theory is that EPSCoR would allow a much more active 
participation in the national research funds of NSF.
    It seems, however, that the NSF distribution of research 
funds has changed little over 25 years, that there are States 
that continue to have a lion's share and then many other States 
are still at 10 percent or less. In fact, one-half the States 
are 10 percent or less of the funding and my sense was when 
EPSCoR was rolled out, it was to give you a big footprint all 
across the country and not just to particular areas of 
research. So are you evaluating ways in which every State can 
participate more aggressively in the NSF funding through 
EPSCoR?
    Dr. Bement. Yes, we are, Senator Reed. I should point out 
that I felt that EPSCoR could be more strategic, more 
effective, so we moved the EPSCoR office into the Office of the 
Director and the reason that EPSCoR serves and interacts with 
all the divisions and all the research offices in the 
Foundation. So it provides much closer coordination through the 
NSF senior management team, not just rely on the base funding 
for EPSCoR, which is largely through the research 
infrastructure improvement program, but to use those 
improvements to be more effective in addressing the rest of our 
research budget, which is the $4.8 billion part.
    We will be looking at the strategic initiatives to do that 
and we did have a workshop just last year where we brought the 
leadership from EPSCoR to the Foundation and they developed 
their report for ``EPSCoR 2020''. So that report is informing 
us on some of the initiatives, but we'll go beyond that report 
as well.
    Senator Reed. Thank you very much, Doctor and it's an 
important program and I encourage you to keep looking at in 
strategic dimensions. Thank you, Madam Chairman.
    Senator Mikulski. Senator Hutchison.

            NOAA deg.WEATHER MODIFICATION RESEARCH

    Senator Hutchison. Well, thank you, Madam Chairwoman. I 
think we have discussed a lot in the area of hurricane 
notification and certainly better timing of notification of 
hurricanes and violent storms; but in the last Congress, I 
tried very hard to work with NOAA on weather modification 
research and NOAA, frankly, blew me off, honestly--didn't care 
about it, didn't want it. They suggested that we go to the 
Office of Science and Technology Policy (OSTP) in the White 
House. OSTP didn't really want it either. My question is, am I 
missing something? Why wouldn't we want, in addition to knowing 
in a timely manner, how we protect against these violent 
weather storms, tornadoes, and hurricanes, why wouldn't we 
study if there are ways to modify these types of occurrences 
and do the research on weather modification in how one area 
affects another area, either for the better or the worse?
    Admiral Lautenbacher. Certainly it's an important topic. If 
you ask our meteorologists and our folks that look at the kinds 
of things that we do--that we are charged to do in our 
authorization bills and appropriation bills, obviously the 
warning and the observation of current storms needs to take top 
precedence because we can't neglect our ability to be able to 
warn citizens and save lives today.
    Senator Hutchison. Of course, of course.
    Admiral Lautenbacher. And then the next point is that you 
start looking at the maturity of weather modification as a 
science and it's really in a basic phase of science. I don't 
want to force it off on my colleague here, who does basic 
science----
    Dr. Bement. I'm glad you did.
    Admiral Lautenbacher. But in all seriousness, NOAA doesn't 
engage in the giving of grants that are in the experimental, 
very grade level of asking fundamental questions. Those kinds 
of things are done by the basic research agencies and what we 
felt was that OSTP, as the head of the science enterprise for 
the U.S. Government, would be in a better position to allocate, 
to decide how to deal with the issue. I think it is an 
important issue and certainly we did not try to blow it off at 
all. I think we need to worry about it and think about it. 
Other countries do and we should do it as well.
    Senator Hutchison. Well, where should it go, and where will 
it get thorough attention? OSTP didn't pick it up. We 
couldn't--actually, they stopped the bill, to be honest. So 
where should it go? Should it go to the National Science 
Foundation? Is that something that would fit there? It seems to 
me that it would more likely fit in NOAA but putting it in the 
White House where they have so many other areas of need, didn't 
seem to work either. Can either of you, Dr. Bement, can you 
suggest if there is something----
    Dr. Bement. Senator, there are many ways in which NSF and 
NOAA collaborate closely and especially in the area of 
understanding extreme weather formation, hurricanes, and 
cyclonic events, and also research on climate change. We are 
very much interested in how best to model the intensification 
of hurricanes, and we do that very well, but also to deal with 
other cyclonic behavior like tornadoes, to understand how they 
form and how they propagate. It is that type of basic research 
and the cyber-infrastructure that goes with modeling and 
simulation that will inform us on how to mitigate these very 
extreme weather events and if modification is the only means of 
mitigation.
    Senator Hutchison. Do you think that we could work to bring 
our bill back and is there a way to bring in NSF and NOAA, 
together, where I think there is more collaboration--the White 
House, OSTP, doesn't really--they don't have grantmaking. 
They're not on the ground studying the research and looking at 
ways to better notify residents of coming storms and floods. Is 
there a potential that we could work together to carve an area 
where we not only look at notification, which is absolutely the 
first thing, I understand, but also whether research holds 
potential that we would lessen the impact of a hurricane 
forming 1,000 miles out in the ocean?
    Dr. Bement. Well certainly, Senator, speaking for the 
National Science Foundation, we would continue to encourage 
grants from the universities and colleges to do research on 
that topic. We would certainly make that information available 
in the open literature.
    Senator Hutchison. My question is, could I work with you, 
then, Dr. Bement, to try to set something up that might create 
a focus there at the NSF?
    Dr. Bement. I'd be delighted to work with you.
    Admiral Lautenbacher. If you'd allow us, we'll work with 
the Office of Science--we can work together, too, if you can 
provide for----
    Senator Hutchison. I think that would be helpful since you 
have so much in that area.
    Admiral Lautenbacher. We can continue this further than I 
thought it had been.

              NOAA deg.RENEWABLE ENERGY RESEARCH

    Senator Hutchison. Okay. Let's work on that. The other area 
I want to quickly just ask about is, I am working on a bill now 
that would establish a council on renewable energy, which would 
again bring together a focus on research on renewable energy, 
including wave technology and wind technology, wind energy 
created in the oceans or the gulf. Do you think that we could 
do something by bringing all of those entities together? My 
bill actually puts in either the National Science Foundation or 
the Federal Lab Consortium for Technology Transfer but do you 
think that there is a potential and maybe you're already doing 
it and I would like to know, on wave technology for creation of 
energy and wind energy in the water as opposed to wind on land?
    Admiral Lautenbacher. Yes, we are the definer of the 
resource, so to speak. We have models, wave models and we have 
the National Oceanographic Data Center that produces reams of 
data of interest. We don't do the actual research on the energy 
devices themselves but we're a part of what needs to come 
together.
    Senator Hutchison. But you could provide the data on what 
kind of power would be in the different parts of the----
    Admiral Lautenbacher. We could tell people where--what 
sorts of energies are available in different parts of our 
coasts at what times of the day, et cetera, how things change. 
We also do that for wind, so if you want to place a wind farm 
somewhere, you can come to NOAA and see where there are winds 
and what the potential capability from them is. The same thing 
works for waves but the actual research on the instruments 
themselves that you would use to harness the energy would be 
done by the Energy Department or by some other outfits in the 
academic or private sector.
    Senator Hutchison. Okay. We're going to be working with the 
National Science Foundation on that as well. Thank you, Madam 
Chairman.

    NSF deg.INTERNATIONAL POLAR YEAR AND THE ALASKA REGION 
                            RESEARCH VESSEL

    Senator Stevens. Thank you, Madam Chairman. I have noticed 
that there is a $59 million request for the IPY activities in 
the budget. I'm sure that you both know that great, desirable 
Alaska and the Alaska Delegation that this money be used in a 
way to try to bring about some understanding of the climatic 
activities in Alaska and really, also the social challenges 
that we face because of those changes.
    We had a hearing last year on this matter and we had hopes 
that these monies would be spent in that way. I don't know what 
the plans are and I'd be happy to learn them.
    I do hope that you will acknowledge the role that Alaska 
must play in the IPY activities. I also note the President now 
has a request for NSF for $42 million for the construction of a 
new Alaska region research vessel. This will replace the Alpha 
Helix, which is a ship that has been dedicated to science. The 
replacement will literally be a floating laboratory focusing on 
chemistry, biology, physics, oceanography, geology. The 
President had $56 million in the 2007 budget. This year there 
is $42 million. Had the first been available--this $42 million 
would have completed construction on that vessel. Unfortunately 
some people around here think that that is an earmark for 
Alaska. It's part of the budget and I'm very disturbed at the 
way it's been viewed by some people.
    I also want to note that we have great hopes that NOAA will 
really use some of these funds available in the President's 
budget. You've got a 3.4 percent increase. I know, however, 
that it is still below the enacted level for 2006 and 2007 but 
we have some enormous changes taking place. One-half the fish 
that we provide from domestic sources are harvested off the 
North Pacific of my State and we are very fearful that the NOAA 
programs that have been ongoing, including the monitoring of 
sea life and research--we now have a petition to declare the 
beluga whales endangered in the Cook Inlet. They are there when 
the fish are there. They follow the salmon. But now we've got 
lawsuits about that, too. I do think that--you mentioned the 
Magnuson-Stevens Act--money--I do think that we have to 
continue our protection against overfishing those areas but I 
do hope that--my question for that introduction is, what are 
you going to be doing about IPY and what's the situation with 
regards to the ship?
    Dr. Bement. Thank you very much, Senator Stevens. IPY is a 
2-year activity but we hope to put in legacy systems that will 
continue research over the next 50 years on some of these 
global issues, including sustainability. With regard to the 
State of Alaska, I have been working, and so has our Office of 
Polar Programs, with the University of Alaska at Fairbanks. 
We've been trying to get a closer partnership with the Barrow 
Climate Change Research Facility. So some of the infrastructure 
elements that we'll be investing in under the International 
Polar Year will be first of all, an Arctic observing network 
that will be linked in with other countries involved in IPY, 
and this Arctic observing network will be part of what we call 
SEARCH, which is the study of environmental Arctic change, and 
hopefully, will eventually be part of GEOSS, the global Earth 
observing system of systems. That is a platform to build upon.
    Second, we need to be able to measure climate change on a 
year-round basis, not just in the summertime. At Toolik Lake, 
we want to make that a year-round facility and we'll be making 
investments to provide the energy and the heating requirements 
to make it a year-round facility.
    Third, working with NOAA on the Barrow Climate Change 
Research Facility, that facility will be completed and will be 
operational next year, in time for the International Polar 
Year. As a result of a workshop we had approximately 1 year ago 
with the University of Alaska and the Barrow Arctic Science 
Consortium, we've identified a number of opportunities for 
those two entities to work closely together during IPY and that 
will require instrumentation of the research facility and also 
connectivity to broadband communications and to the Internet. 
That will give researchers at Barrow access to the University 
of Alaska computing facilities as well as their technical and 
scientific library capabilities. Those are a few examples of 
what we have in our plan for Alaska during the IPY.
    With regard to the Arctic region research vessel, that 
program is going well. We had our solicitation. The proposal 
that was selected turned out to be a sole proposal, from the 
University of Alaska at Fairbanks. We intend the Arctic region 
research vessel to be a national asset, more than just an asset 
for the State of Alaska. There were some issues with the 
proposal but we will work with the University of Alaska to 
broaden the scope and improve the plans for managing the 
project.
    We hope to be able to start that project this fiscal year 
and we will be requesting permission to do so in our 2007 plan.

          NOAA deg.INTERNATIONAL POLAR YEAR PROJECTS

    Admiral Lautenbacher. Well, as you're aware, the bulk of 
the new IPY funding or additional funding is not within NOAA. 
We are partnering with the agencies as I am with NSF to 
leverage the basic research funding that is going into it. We 
have $15 million associated directly with the IPY projects, 
which is an increase of $1 million for new projects.
    The bulk of that is in observations. We need to create, as 
I know you well know, a better long-term observing system for 
the Arctic. We've partnered with the Canadians to start a new 
Arctic Observation Station on Ellesmere Island. We have 
research crews into the Arctic with the Russians, where we are 
leveraging some of their money.
    We are going to continue looking at the stratosphere of 
ozone measurements. We have put some money in for looking at 
improved weather, sea ice, and ocean wave forecasting in the 
Arctic. That's a special part of the world, as you are well 
aware. That will be an important part of refining the new 
information that comes out of it and using it, hopefully, to 
help improve our weather and climate forecasting. We are 
looking at predictions on improving arctic environment 
forecasts from seasonal to centennial. So we want to get into 
the climate prediction area for that part of the world.
    A very important part of the data gathering is the $3.3 
million we have for UAS systems, unmanned aircraft systems, a 
perfect place to test and experiment with those kinds of 
systems for continuous observing, is the Arctic. We plan to 
look for a strong way of doing that during this IPY. Thank you, 
sir.

           NOAA deg.INTERNATIONAL WHALING COMMISSION

    Senator Stevens. I'd be remiss if I didn't mention that the 
meeting in Anchorage of the International Whaling Commission, 
for almost 25 years, through the great efforts of Sylvia Earl, 
who is one of your predecessors. We've had the opportunity for 
Alaska Eskimos to harvest a number of whales that they use to 
consume. It's not a commercial operation. Japan now, is using 
surrogates from Pacific and Caribbean Islands to try to 
threaten that program unless we all support the restoration of 
their commercial whaling activities, which we oppose, totally 
oppose.
    I hope that you use all the efforts that you can to 
convince the Japanese that as far as I'm concerned, if they 
insist on destroying the Eskimos ability to continue their 
cultural activities and have that meat available for their 
personal use because of the world's desire not to support their 
commercial activities, I think this--I will lead the charge and 
get some severe reaction against the nation of Japan. They're 
wrong and that's a small group within their country. They 
should not be doing this politically. They should not be doing 
it with their Embassy group and I'm really very disturbed with 
Japan to think that they believe that those 15 to 18 whales 
that our people consume should be offset by commercial whaling 
off their country, we've now restored the populations. They are 
balanced and protected so I hope you will all help us emphasize 
to Japan, this is not their day to bargain commercial whaling 
against Eskimos right to survive.
    Admiral Lautenbacher. Yes, sir. We're working very strongly 
to support your position. Thank you, sir.
    Senator Inouye. Thank you very much, Madam Chair. I'd like 
to say that the Senator from Alaska is absolutely correct.
    Madam Chair, the two agencies represented here are the 
guardian angels of the State of Hawaii. Hawaii, as we all know, 
is rather unique, isolated. For example, we have 85 percent of 
all the coral reefs in the United States. We just opened up a 
140,000 square mile marine sanctuary. That's more than all the 
national parks combined.
    And we're counting upon NSF to save us because of the 
climate change studies. You may not know this, Doctor, but as a 
result of your work, real estate people are beginning to look 
at whether coastal properties are just as good as mountain 
properties.
    Senator Inouye. The coastal properties used to be the prime 
ones but now with the sea level getting up there, people are 
beginning to take a second look. So what do you do? Hawaii is 
very important and we're working at this moment, Madam Chair, 
with the NSF on the feasibility and possibility of establishing 
a major solar telescope on Mount Hale/Akala and we're pleased 
with the work that NOAA does for us. For example, without NOAA 
I don't think Hawaii or the rest of the world can get such fast 
advance notice on tsunamis. I don't have any questions. I just 
want to thank them and I thank you.
    Admiral Lautenbacher. Thank you very much, Senator.
    Dr. Bement. Thank you very much, Senator.
    Senator Mikulski. Well, the Senator was absolutely right in 
describing his own State. Before he arrived, we asked about the 
status, particularly of the tsunami early warning system, which 
I knew that you've been a real leader in establishing and 
advocating with this subcommittee, regardless who was Chair. 
Yes, sir?
    Senator Inouye. I have one question for the National 
Science Foundation. This is my third meeting this morning and I 
had to attend all three. Can you devise some system for the 
United States Senate where we can attend several meetings at 
the same time? I go to one for 10 minutes, another one for 15 
minutes and here I am and I didn't hear your testimony. I 
wanted to be here in the morning, Madam Chair but----
    Senator Mikulski. Well, you're here. We're very well 
mindful of this.
    Senator Inouye. Can you get the NSF to do this for us?
    Senator Mikulski. We can put that in with Senator 
Hutchison's Weather Modification Program.
    Senator Inouye. I move to increase----
    Senator Mikulski. We'll get a College Senate Venture 
Capitol Fund.
    Dr. Bement. I think, Senator, perhaps in the next 50 years, 
we might be able to discover how to clone you physiologically 
but I don't think we'll ever be able to clone you mentally.
    Senator Mikulski. Senator Shelby.
    Senator Shelby. Thank you, I think.
    Senator Mikulski. A wrap-up here.

     NOAA deg.FUNDING INCREASES FOR NATIONAL OCEANIC AND 
              ATMOSPHERIC ADMINISTRATION SATELLITE PROGRAM

    Senator Shelby. The Senator is absolutely on point, though. 
We do have to be at a lot of places at the same time and we 
can't do this but we appreciate your appearance here today. 
NOAA--the NOAA 2008 budget shows a decrease in overall 
satellite costs. However, it is my understanding that Congress 
can expect future increased budget requests for our NPOESS.
    At some point, NOAA needs to make up for the $4.1 billion 
gap between the program's original cost and its projected 
expenses. NOAA's satellite program dwarfs the funding levels of 
NOAA's other research and operation programs. Admiral, what 
assurances, if any, can you provide the subcommittee today, 
that any increased funding for NOAA's satellite programs, which 
are important, will not infringe on the budget request for 
NOAA's other research and operation programs, especially for 
ocean-related activities?
    Admiral Lautenbacher. Yes, sir. That's a very important 
question. We have tried to work on, since I've arrived, a 
longer range budget forecasting and programming system. One of 
the results of that is that we have delivered to you, through 
the chain of command, a budget that goes out 5 years. So you 
can look--we can look and see what's there.
    Senator Shelby. We know. And you're deeply challenged here. 
I know this, as we are.
    Admiral Lautenbacher. Yes, yes we are. But I think there is 
a realization, certainly through much of my chain of command in 
the administration that you have to look at these longer term 
plans and if you commit to a certain year, you are committing 
to a budget estimate that must be accounted for. I assure you 
that I will continue to push to have that capitalization budget 
held separately from the operating budget. Can I guarantee what 
will happen as you have future difficult budget decisions to 
make? That's a very difficult thing for me to make projections 
and commit to today. But I think there is more interest in 
dealing with the capitalization budget on a rational basis and 
looking at the operational budget.
    Senator Shelby. Absolutely. And I think this is going to be 
one of our challenges here, too.
    Admiral Lautenbacher. Yes, sir.

           NSF deg.NATIONAL SCIENCE FOUNDATION DAYS

    Senator Shelby. The National Science Foundation. Raising 
the awareness of opportunities available through research 
grants for the National Science Foundation, we know will 
benefit the Nation and also bring researchers with great ideas 
to an agency that funds the best of the best research. One such 
way to do this is through the National Science Foundation days 
where Foundation staff go to schools and explain the grant 
application process and how to improve proposals submitted to 
the National Science Foundation because we're interested in the 
best of the best, aren't we, Doctor?
    Dr. Bement. That's correct.
    Senator Shelby. Could you give us briefly, some examples of 
how high past NSF Days have had an impact on improving grant 
approval rates at locations where the National Science 
Foundation has conducted some of these meetings?
    Dr. Bement. Yes, sir. As you know, NSF has conducted three 
NSF days in the State of Alabama over the last 5 years, the 
last one being at Tuskegee just last March. What we normally 
discover is that it is an opportunity for all of those who 
attend these NSF Days. Collectively, for all three of these 
events, we interacted with 400 principal investigators (PIs) in 
the State of Alabama. Those who attend the days have an 
opportunity to talk with program officers and they have an 
opportunity to talk with other PIs on how best to submit 
proposals to the Foundation and especially how to submit a 
successful proposal. The proposal volume does go up shortly 
after the NSF Days, in fact, sometimes it's a blizzard. That is 
not the end of the story. Beyond that, it is a matter of our 
program officers working closely with the PIs after they may 
have been declined the first time to improve their proposals so 
that their chances of being accepted the second or third time 
can go up.
    We generally find that that's probably the best way to 
succeed in getting a grant. It's seldom the case that a grant 
is approved the first time but usually the second or third 
time. So the role of the program officer is really very 
critical.
    I should tell you, however, that workload on our program 
officers has become very enormous, primarily because what was 
the salaries and expenses account, which we now call the agency 
operation and award management account, keeps getting 
truncated, one way or another.
    The opportunity to improve success rate depends very much 
on the ability of the program officers to work with the PIs in 
improving their proposals.

                NSF deg.EPSCOR PROGRAM ENHANCED

    Senator Shelby. How will the elevation of the EPSCoR 
program into the Office of the Director enhance its position 
and benefit states in making them more competitive?
    Dr. Bement. It will get the senior management team more 
directly involved. We will be working more closely at that 
level, with the leadership in EPSCoR, to see what more we can 
do to re-invigorate the program and perhaps take a more 
strategic approach in improving the leverage of the EPSCoR 
investment. Those are the directions we'll be taking.
    Senator Shelby. Madam Chairman, I have a number of 
questions that I'd like to submit for the record, in the 
interest of time, if you would.

                   NOAA deg.POLAR SATELLITES

    Senator Mikulski. Certainly, Senator Shelby. We'll welcome 
those questions and before you might have to depart because I 
know we're--several appropriations hearings are going on 
simultaneously. I'd like to pick up on the issue of polar 
satellites and yesterday, Admiral Lautenbacher, you talked 
about it because it's accountability and I've got two big 
issues. You, with this satellite system and where we're heading 
this way also, with the research facilities that I think are 
getting overruns at the National Science Foundation.
    You outline for me and I'd like you to outline and repeat 
for Senator Shelby, how you intend to stand sentry over this 
bill, to bring about the necessary management reforms and 
oversight that have been triggered by Nunn-McCurdy that I think 
we can expect a better stewardship of this because this is a 
program that has overruns. We're worried about spending more 
money to get less science.
    This is one of the most crucial observatory tools that 
we're going to have, particularly for the climate crisis. But 
could you share, for the record which you shared with me and 
I'd like very much if Senator Shelby heard it because every 
time they hear about overruns, it's just one more excuse to not 
get support for what we need to do for the agency. Would you 
agree, Senator?
    Senator Shelby. Yes.
    Admiral Lautenbacher. Thank you, Madam Chair. I would be 
very happy to do that. This obviously is a very critical issue 
to me personally and to the agency.
    The entire NOAA team is energized to work on this problem. 
My Deputy for Satellites, Assistant Deputies, the Deputy Under 
Secretary. We have set a program management team. We have 
basically overhauled the management team inside of NOAA from 
top to bottom. We've made personnel changes where necessary in 
our chain of command and personnel changes within the program 
office and set up, basically an inspector general (IG)--
internal IG to make sure that there is continual oversight. We 
have also ensured that we'll work collaboratively with the 
Department of Defense and NASA, the other two agencies involved 
and I meet quarterly with the heads of acquisition for the 
Department of Defense (DOD) and Space, which is the Under 
Secretary of the Air Force and Administrator Mike Griffin from 
NASA. So we are definitely, personally involved and we have 
gotten the personal attention of the presidents of and chief 
executive officers (CEOs) of Northrop Grumman and Raytheon, who 
sit in those meetings, too.
    We have program monitoring from the Government down to very 
fine details inside the program. We are getting independent 
cost estimates frequently. We have independent review teams 
looking at it from outside to make sure we have independent 
advice to make sure people are on track. We track schedules and 
dollars on an earned value management system down four or five 
levels into the program and that information is reported daily 
and weekly, internal to the program.
    We are changing the contract to set up the right 
incentives. That was another criticism and we will reward 
performance versus just hanging in there. We've also revamped 
the program so that it is less risky. We have reduced the 
amount of difficult technical milestones that contractors had 
trouble meeting, to a level we believe they can be met. I am 
confident that the schedule that we put in place with the new 
funding profile is going to achieve success, and I assure you 
that everyone at NOAA, from top to bottom, is committed to 
making that happen, Madam Chair. Thank you.
    Senator Mikulski. Senator Shelby, does that give you a 
little bit more assurance on this matter?
    Senator Shelby. It does. I like what they're doing and 
you're trying to do. I think you just need some more funds.

     NSF deg.NATIONAL SCIENCE FOUNDATION FACILITY FUNDING

    Senator Mikulski. Let's go though, to also another area of 
accountability, is with the National Science Foundation. We're 
very concerned about the research facilities and also certain 
tools for research. The Alaska region research vehicle that 
Senator Stevens spoke about is really important. So we don't in 
any way minimize the need to have this vessel. And it's a 
research vessel, as I understand it, Director Bement, that has 
to operate in ice under very rugged conditions. But at the same 
time, it's running $25 million over the original estimate.
    Now, this ship could run aground here, with cost overruns 
and as Senator Stevens said, he's being treated like it's an 
earmark when essentially it's an integral part of Arctic 
research. And when the overruns come, it sounds like we're 
picking and porking out here in some Alaska toy when it's not. 
It is a very important research tool but we're very concerned 
about this $25 million cost overrun. Now why are there overruns 
and what are you going to do about it?
    Dr. Bement. Yes, Senator, thank you. This vessel was scoped 
a long time ago. The design was completed in 2004. The original 
baseline budget was set at that time. It is now being re-
evaluated. Since that time, there have been changes in 
regulations, some having to do with environmental operations, 
some having to do with safety and operating in the Arctic 
region. And as you know, this ship will operate in ice up to 2 
to 3 feet thick so it will be a great advancement over the 
Alpha Helix.
    In addition to that, commodity costs, especially the cost 
of steel has skyrocketed because of global demand, especially 
from China. Furthermore, shipyards are now value pricing their 
operations, primarily because they're overloaded with building 
ships for the oil industry. So it's very difficult to get a 
shipyard scheduled, and furthermore, the cost of construction 
in a shipyard these days has also escalated. As we move into 
the coming year, we're going to have to revisit the budget. I 
can assure you it will be higher than it is now. This is just 
the way things are turning out, but the sooner we get a start 
on that project, and that's one of the reasons we want to start 
it in 2007, the more I think we can mitigate these cost 
increases over the next year or two.
    Senator Mikulski. Do we know how much this is going to 
cost?
    Dr. Bement. I'm sorry?
    Senator Mikulski. Do we--you know, it's a pattern here that 
I've now experienced in other subcommittees and we're seeing it 
here, that there was a project. It was 2004. Then we're 
operating on data that is several years old and then we don't 
know what the cost is. But when we get into these things and 
they get started, it has congressional support because of the 
scientific necessity and then there we are. Now, do we know 
what this is actually going to cost?
    Dr. Bement. Madam Chair, we will very shortly revisit the 
design of this ship, based on current regulations. The redesign 
will take place over the next 4 months or so, and we then will 
re-baseline the cost. We will be able to report to you at that 
time what we think the real cost will be for this ship.
    Senator Mikulski. But at the same time that you're doing 
that, are you also going to be rebasing these costs?
    Dr. Bement. Oh, we do that on a continuing basis, not only 
internal to the Foundation but also with the grantees that have 
the responsibility for this ship.
    Senator Mikulski. Well, just know, we believe that this 
vessel is important, just like the satellites are important. 
And the world is mesmerized by Arctic research and now we're 
also looking at how to have more collaborative work with 
Greenland. We could elaborate on that. But when these things go 
$25 million, we also know that the ALMA telescope is $16 
million over. Now why is the ALMA telescope $16 million over?
    Dr. Bement. The ALMA telescope is pretty much the same 
story. The reflectors on the telescope are made out of a very 
expensive nickel-based alloy in order to prevent any thermal 
expansion, because it's a very precise instrument. The cost of 
those alloys have gone up enormously, again because of world 
pressure on commodity costs, which was the biggest contributor 
to the cost of the instrument. There are other factors that 
also contributed to increased project costs: construction costs 
in Chile and some upper management costs that escalated because 
it is a 50/50 joint venture between the United States and the 
European Southern Observatory that has been a very difficult 
teaming relationship to put together and to operate.
    Senator Mikulski. But then my question is--so what? Where 
do we go from here? And what again are the fiscal disciplines 
coupled with making sure that the fiscal discipline is so 
severe we lose the point of the project?
    Dr. Bement. Madam Chairman, we have re-scoped the project. 
We've reduced the number of telescopes from 24 to 50 in order 
to absorb some of the cost increases yet still retain the 
transformational capability for this facility. We have put in 
cost tracking methods and other management techniques and it 
has undergone a high level senior review of all elements and 
costs associated with the project. The project has been re-
baselined. We have re-established a contingency. We have better 
management tools in place and I think based on the reports that 
I get, are confident that we'll be able to stay within the 
current budget.
    Senator Mikulski. Well, you have a big responsibility here 
in this agency but I can tell you that as you look at how all 
of your research endeavors add up, if they begin to have 
overruns, there will have to then be a moratorium on new 
projects. I mean, the scientific community needs to know that. 
That is, once that goes up, there is not just unlimited--I'm 
not threatening. I'm not saying it. We would not do arbitrarily 
or capriciously. But every time we turn around, there is some 
big ticket being added then somebody else comes in and wants to 
do something new and we have inherited what are now becoming 
legacy projects and just these two alone come to $41 million in 
cost overruns. We know that instruments are expensive. We know 
about the global pressures on commodities, et cetera. At the 
same time, we are where we are. And, therefore, there needs to 
be both within the agencies themselves, all within our 
portfolio, NASA, NSF, NOAA--all--the FBI with their info-tech 
boondoggle that they are now getting back on track.
    The subcommittee is going to be very stern on 
accountability because it's the only way, particularly in these 
off austere budget times, that we must get value for the 
mission and I'm very--I want everyone in the Commerce, Justice, 
Science to understand it's not being prickly but we just face a 
real reality.
    Dr. Bement. Well, Madam Chairman, I accept that. As a 
matter of fact, I appreciate it because I stake my personal 
accountability on these projects.
    Senator Mikulski. And I know you do--we know each other 
from the National Institute of Standards and Technology.
    Dr. Bement. And between myself and the Deputy Director and 
our senior management team, we are spending much more time on 
this. We are having more frequent reviews and I can assure that 
going forward, we are going to watch these costs like a hawk.

            NOAA deg.ADDITIONAL COMMITTEE QUESTIONS

    Senator Mikulski. What we want to say very loud and very 
clearly to both the agency directors, to the scientific 
community and then to the private sector with whom we have to 
have contracts with, we've got to really--we've got to really 
exercise every modern fiscal discipline technique at our 
disposal and the Congress loves science and technology. So do 
the American people. But we can't rubber stamp. So that's kind 
of what we wanted to talk about. We also want to encourage 
ongoing cooperation in ocean research. That's something we'd 
like to talk about more in another day, also really encouraging 
our young people in science. I think Senator Shelby raised 
this. I don't want the subcommittee to end on a downer. It's 
because Senator Shelby and I are so committed to the fact of 
really rising above the gathering storm. But we have to also 
rise against what we fear is a gathering fiscal morass.
    [The following questions were not asked at the hearing, but 
were submitted to the administration for response subsequent to 
the hearing:]
      Questions Submitted to Vice Admiral Conrad Lautenbacher, Jr.
           Question Submitted by Senator Barbara A. Mikulski
                 progress on the u.s. ocean action plan
    Question. In response to the U.S. Ocean Commission, the 
Administration developed the ``U.S. Ocean Action Plan''. To date what 
progress has been made regarding implementation of this plan? To what 
extent does the ``U.S. Ocean Action Plan'' coincide with the 
recommendations of the Joint Ocean Commission?
    Answer. In January 2007, the Committee on Ocean Policy released the 
``U.S. Ocean Action Plan Implementation Updates.'' Seventy-three of the 
88 actions have been completed. The remaining actions are progressing 
on schedule.
    The U.S. Ocean Action Plan (OAP) was a required response under the 
Oceans Act of 2000 to the U.S. Commission on Ocean Policy. Therefore, 
it is difficult to directly map the OAP to the recommendations of the 
combined Commissions, represented by the Joint Ocean Commission 
Initiative. In broad terms, both Commissions outlined the need for: 
enhancing ocean leadership and coordination, developing the 
institutional capacity to coordinate across jurisdictional boundaries, 
and strengthening the agency structure in phases in order to enhance 
the goals of addressing management needs through an ecosystem-based 
approach.
                          ``counterfeit'' fish
    Question. A recent article in the Washington Post cited an example 
of counterfeit fish being sold to restaurants and consumers in Florida. 
The article reported how undercover agents ordered grouper at 24 
Florida restaurants, but the alleged grouper at 17 of 24 restaurants 
sampled by investigators was actually another, less desirable species, 
according to DNA analysis conducted. NOAA reported that, in many 
instances the ``grouper'' was actually farm-raised Asian catfish from 
Vietnam or other species that swim with grouper, and the filets have 
shown signs of salmonella and traces of illegal carcinogenic 
fungicides.
    How rampant of a problem is imported counterfeit fish?
    Answer. Mislabeled seafood products are a significant problem in 
the marketplace worldwide. While no definitive statistics exist about 
the rates at which fish is mislabeled, the NOAA Seafood Inspection 
Program (SIP) encounters several types of mislabeling that affect the 
economic integrity of seafood products. Examples of mislabeling 
include, substituting a lower cost species for a higher cost species, 
such as the grouper example in your question, short weighing, and 
altering the country of origin or fraudulently identifying the area 
fished and port of landing.
    A recent example of the problem is provided by a 2005 case where 
NOAA SIP rejected over nine million pounds of seafood that was destined 
for a large retail supermarket chain. Another recently completed 
investigation disclosed the importation of approximately 3 million 
pounds of falsely labeled fish product over a three year period. During 
this investigation NOAA seized approximately 300,000 pounds of this 
illegal fish which contained malachite green--a known carcinogen banned 
by the FDA. NOAA SIP works with many retailers to ensure that the 
seafood they buy meets their quality levels and these scenarios are not 
untypical.
    Question. Does NOAA have enough resources to adequately address 
this problem?
    Answer. Currently, NOAA has approximately 150 special agents and 20 
enforcement officers dispersed nationwide. Incidents of mislabeling are 
an international problem which provides substantial financial profits 
to those who participate in this illegal activity. Although NOAA's 
enforcement resources are primarily focused on importers and exporters, 
this illegal activity extends well beyond these operations to included 
distributors, wholesalers, retailers and restaurants. Investigations 
can take years to complete, are labor intensive, demand extensive 
financial and document analysis, and in many instances requires the 
cooperation of other countries. NOAA leverages its investigative 
resources by concentrating on the primary businesses (importers, 
exporters or large distributors) which have the greatest impact on this 
illegal activity.
    Question. What is being done to prevent this problem from 
escalating?
    Answer. Continued investigations and subsequent successful 
prosecutions of those found violating our laws is the best deterrent. 
Our investigations have resulted in the seizure and ultimate forfeiture 
of hundreds of thousands of pounds of mislabeled product worth millions 
of dollars on the market. Additionally, the imposition of fines and 
penalties in the millions of dollars and, in some cases, incarceration 
has a significant impact. In one recent case, two businesses were 
forfeited and we have observed the dissolution of business entities 
involved in illegal activities as a result of our enforcement 
activities. We continue to focus on the most blatant violators in an 
effort to have the largest impact on this illegal activity. Publication 
of our investigations and education of the public through various media 
sources is extremely helpful.
                              aquaculture
    Question. The NOAA budget for fiscal year 2008 requests an increase 
of $3 million to develop a regulatory program for marine aquaculture. 
What is the state of the U.S. marine aquaculture industry? What 
investment are our international competitors doing in regard to marine 
aquaculture? Are there technological barriers to more marine 
aquaculture? What is being done to reduce those technological barriers?
    Answer. The U.S. marine aquaculture industry is relatively small 
compared with overall U.S. and world aquaculture production. U.S. 
aquaculture production totals about $1 billion annually, compared to 
world aquaculture production of about $70 billion. Only about 20 
percent of U.S. aquaculture production is marine species.
    The largest single sector of the U.S. marine aquaculture industry 
is molluscan shellfish culture (oysters, clams, mussels), which 
accounts for about two-thirds of total U.S. marine aquaculture 
production, followed by salmon (about 25 percent) and shrimp (about 10 
percent). Current production takes place mainly on land, in ponds, and 
in coastal waters under state jurisdiction. Recent advances in offshore 
aquaculture technology have resulted in several commercial finfish and 
shellfish operations in more exposed, open-ocean locations in state 
waters in Hawaii, New Hampshire, and Puerto Rico.
    Marine aquaculture includes the production of hatchery fish and 
shellfish which are released into the wild to support commercial and 
recreational fisheries as well as to enhance or rebuild wild stock 
populations. Marine aquaculture also includes the production of 
ornamental fish for the aquarium trade and plant species used in a 
range of food, pharmaceutical, nutritional, and biotechnology products. 
There are also related industries--such as equipment production, feed, 
and nutrition companies and aquaculture consulting service firms--that 
provide support to the global aquaculture industry.
    According to the United Nations Food and Agriculture Organization, 
the United States ranked 10th in total aquaculture production in 2004, 
behind China, India, Vietnam, Thailand, Indonesia, Bangladesh, Japan, 
Chile, and Norway. The United States imports significant volumes of 
marine aquaculture products from these and other countries, resulting 
in an annual seafood trade deficit of about $8 billion.
    There is significant potential to increase aquaculture production 
in the United States using today's technology. Preliminary production 
estimates by NOAA indicate that domestic aquaculture production of all 
species could increase from about 0.5 million tons annually to 1.5 
million tons per year by 2025. The additional production could include 
760,000 tons from finfish aquaculture, 47,000 tons from crustacean 
production, and 245,000 tons from mollusk production. Of the 760,000 
tons of finfish aquaculture, 590,000 tons could come from marine 
finfish aquaculture.
    The major barriers to marine aquaculture are finding suitable sites 
in coastal areas (where aquaculture must compete with many other 
coastal uses), clarifying the regulatory and environmental requirements 
for existing as well as new marine aquaculture operations (including 
offshore), and developing technologies and best management practices to 
ensure that various types of production systems are compatible with 
marine ecosystems. There is also a need to develop hatchery operations 
to provide fingerlings for finfish production systems.
    Business needs regulatory certainty to make sound investment 
decisions and obtain financing. There is currently no way to obtain a 
permit for aquaculture in federal waters under existing laws and 
regulations. Thus, in response to the U.S. Commission on Ocean Policy 
and the U.S. Ocean Action Plan, the National Oceanic and Atmospheric 
Administration (NOAA) and the Department of Commerce drafted and sent 
to Congress the National Offshore Aquaculture Act of 2007. The Act 
would provide the necessary authority to establish a regulatory 
framework and authorize research for all types of marine aquaculture.
    Those concerned about the impacts of offshore aquaculture need to 
know the industry will be held to strict environmental standards by the 
proposed legislation. One way to address these needs at the same time 
as those of the marine aquaculture industry is through demonstration 
projects with research partners so that technologies and practices can 
be tested, their impacts evaluated, and systems improved. Another is to 
support research projects to develop alternatives to use of fish oil 
and fish meal in aquaculture feeds, develop culture methods for new 
species of value to commercial production as well as stock enhancement, 
and study the impacts (including cumulative impacts) of marine 
aquaculture on marine ecosystems.
    Since 1998, the National Oceanic and Atmospheric Administration 
(NOAA) has funded a total of $15 million through the National Marine 
Aquaculture Initiative (NMAI) to support research to boost the 
production of commercially and recreationally valuable marine shellfish 
and finfish species in the United States. Projects have responded to 
key scientific, engineering, environmental, and economic questions for 
aquaculture. For example, NMAI has funded studies of candidate species, 
health and nutrition, best management practices, ecosystems monitoring 
and management, engineered production systems, and legal and 
operational frameworks.
    In September 2006, NOAA awarded $3.6 million in competitive grants 
to 11 sustainable marine aquaculture demonstration and research 
projects under NMAI. The initiative is managed by the NOAA Aquaculture 
Program and administered by NOAA Sea Grant. The 2006 NMAI funding 
supports projects to assess the commercial potential of marine 
aquaculture, the feasibility of stock enhancement, the environmental 
impacts of aquaculture in various environments, as well as research on 
key aquatic animal nutrition and health issues.
    Another way in which NOAA is working to address technological 
barriers is through a planning process with the Department of 
Agriculture and the Department of Interior to develop a national 
aquatic animal health plan. This plan, which has been in development 
for four years and has included stakeholders from industry and state 
agencies, will provide protection for the nation's cultured and wild 
aquatic resources, facilitate safe commerce of live products, and 
improve the availability of diagnostic laboratories for aquaculture. 
This plan will be completed by summer of 2007.
    NOAA also has marine aquaculture research capabilities at NOAA 
laboratories within the National Marine Fisheries Service and the 
National Ocean Service, and research and extension capabilities through 
state Sea Grant Programs. Congressionally mandated research--such as an 
open ocean aquaculture demonstration project at the University of New 
Hampshire and research around the country on oysters, shrimp, crab, and 
other species--has also helped to advance the state of marine 
aquaculture technology. Other federal agencies and research 
institutions are also investing in research to address technological 
challenges. For example, the Advanced Technology Program within the 
National Institute for Standards and Technology has supported a number 
of advanced research and technology projects. In addition, aquaculture 
companies have received support for the development of commercial 
products and services through the Small Business Innovation Program 
(SBIR) at NOAA and the U.S. Department of Agriculture and, in the past, 
through the Saltonstall-Kennedy Program.
        noaa's center for weather and climate prediction project
    Question. The Committee was recently informed that the planned 
Center for Weather and Climate Prediction in College Park is behind 
schedule and cost estimates have increased for NOAA ``above standard'' 
improvements.
    What are the consequences to NOAA's budget request due to the 
delayed construction schedule?
    Is NOAA reexamining the ``above standard'' improvements in order to 
lessen any budgetary impacts?
    Answer. The NOAA Center for Weather and Climate Prediction (NCWCP) 
project is a build and lease-back project under which a private 
developer is responsible for building a facility, in this case on 
property owned by the University of Maryland. The developer will own 
the building once built, and NOAA will lease back the building. The 
developer is only responsible, under the development lease with the 
General Services Administration (GSA) who is managing the project for 
the government, to build general office building space. Tenant specific 
requirements--such as enhanced heating, ventilation, air conditioning, 
electrical, and lighting capabilities--required to support specialized 
(above office-standard) NOAA operations such as weather and climate 
modeling, laboratory operations, analysis of global environmental 
satellite data, and protecting the reliable flow of critical weather 
warning, forecast, and data products to the Public must be paid for by 
NOAA as part of the initial construction costs of the building.
    NOAA has been apprised by GSA that, due to delays in the 
construction schedule and general increases in construction costs 
(labor and materials) at rates higher than those projected by GSA when 
the initial cost estimate for the project was developed in 2002, NOAA 
should expect increases in the cost of above-standard construction 
work. NOAA has not yet received final pricing of above-standard 
construction work from the developer. Once we have received this 
pricing information, we will assess the impact on fiscal year 2008. 
Failure by the government to timely fund these costs could further 
delay the construction schedule; and expose the government to claims 
from the developer for government-caused delays and associated 
financial damages.
    We are continuing to re-examine areas where we can take reductions 
in above-standard requirements without compromising the mission 
conducted at the facility, so as to mitigate budgetary impacts.
                   npoess and goes-r funding request
    Question. Please provide a detailed breakout of the NPOESS and 
GOES-R program funding requests for fiscal year 2008 for each of the 
major aspects of the programs.
    Answer. The fiscal year 2008 request for the Geostationary 
Operational Environmental Satellite Series R (GOES-R) Series is $279 
million. The breakout of the budget request, in millions of dollars, is 
as follows:

                        [In millions of dollars]
------------------------------------------------------------------------
                  Development Activity                        Request
------------------------------------------------------------------------
System Acquisition and Operations.......................              45
Spacecraft..............................................              14
Instruments:
    Advanced Baseline Imager (ABI) to meet the                        54
     production schedule for launch and provide real-
     time environmental data and uninterruptible
     observations.......................................
    Solar Imaging Suite (SIS) preliminary design........              55
    Space Environmental In Situ Suite (SEISS)                         21
     preliminary design.................................
    Geostationary Lightning Mapper (GLM) continuation of              17
     the acquisition and operations phase...............
Government Program Office Operations....................              73
                                                         ---------------
      TOTAL GOES-R Fiscal Year 2008 Request.............             279
------------------------------------------------------------------------

    The combined fiscal year 2008 request for the National Polar-
orbiting Operational Environmental Satellite System (NPOESS) is $666 
million. Of that amount, NOAA's portion is $331 million, with the 
remaining funding coming from the U.S. Air Force. The breakout of the 
fiscal year 2008 budget request, in millions of dollars, is as follows:

                        [In millions of dollars]
------------------------------------------------------------------------
                  Development Activity                        Request
------------------------------------------------------------------------
Program Acquisition--NPOESS Prime Contract:
    Ground Systems......................................              98
    Spacecraft and Instruments..........................             340
    System Engineering/Program Management...............             142
Government Program Office Operations....................              86
                                                         ---------------
      TOTAL NPOESS Fiscal Year 2008 Request.............             666
------------------------------------------------------------------------

                        goes-r program trl level
    Question. The NOAA budget justification states that the GOES-R 
satellite launch date is now ``no earlier than 2014'' and that this 
provides ``additional opportunities to mitigate identified risks in 
GOES-R development.''
    Using the NASA defined Technical Readiness Scale (TRL), what level 
is the GOES-R program currently in? What TRL level will GOES-R be in at 
the end of fiscal year 2008?
    Answer. Technology Readiness Levels (TRL) for GOES-R are:

------------------------------------------------------------------------
                                            Current TRL    Projected TRL
               Instrument                   (September      (September
                                               2006)           2008)
------------------------------------------------------------------------
Advanced Baseline Imager (ABI)..........               5               6
Solar Imaging Suite (SIS)...............               6               6
Space Environmental In-Situ Suite                      5               6
 (SEISS)................................
Geostationary Lightning Mapper (GLM)....               4               5
Spacecraft contract.....................         ( \1\ )             5-6
------------------------------------------------------------------------
\1\ Not awarded.

                    goes satellite construction time
    Question. Please provide a summary of how long it took to build 
each GOES satellite starting with GOES-11 through GOES-P.
    Answer.
GOES I-M Series
    Contract award for the Geostationary Operational Environmental 
Satellites (GOES) I-M Series was made on 1985. The first in the series, 
GOES-I, was launched in April 1994.

------------------------------------------------------------------------
                                     Contract Award
            Satellite                     Date          Satellite Launch
------------------------------------------------------------------------
GOES-L (GOES-11).................  1985..............  May 2000
GOES-M (GOES-12).................  1985..............  July 2001
------------------------------------------------------------------------

GOES N-Series
    GOES N-Series used the same primary instruments as the GOES I-M 
Series but a different spacecraft.

------------------------------------------------------------------------
                                     Contract Award
            Satellite                     Date          Satellite Launch
------------------------------------------------------------------------
GOES-N (GOES-13).................  1998..............  May 2006
GOES-O...........................  1998..............  Spring 2008
GOES-P...........................  1998..............  Spring 2009
------------------------------------------------------------------------

    For both the GOES I-M Series and GOES N-P Series, it took longest 
to build and launch the first satellite in the Series. The second and 
subsequent satellites in the Series are the same design as the first 
satellite.
                 probability of goes-r operational gap
    Question. What is the estimated probability of an operational gap 
if GOES-R launches in 2013? 2014? 2015?
    Answer. In order to minimize the probability of an operational gap, 
NOAA maintains two operational spacecraft, Geostationary Operational 
Environmental Satellite (GOES)-East and GOES-West, and an on-orbit 
spare at all times. The on-orbit spare can be activated to operational 
status in a short period of time in the event either GOES-East or GOES-
West satellites fail.
    NOAA constantly assesses the health of the spacecraft and 
instruments and uses sophisticated statistical techniques to calculate 
when satellites are needed to avoid an operational gap. Based on these 
analyses, NOAA has determined that the GOES-R satellite needs to launch 
in December 2014 to serve as the on-orbit spare. Two years later it 
will replace GOES-O as an operational satellite.
    Launching GOES-R in December 2014 results in a 78 percent 
probability of two spacecraft availability.
    Launching GOES-R in 2013 increases the probability to 86 percent of 
two operational spacecraft.
    Launching GOES-R later in 2015, decreases the two-operational 
spacecraft availability to 62 percent.
    Question. If an operational gap were to occur in GOES-R--what 
backup plan exists (e.g., utilizing other systems (allied or 
domestic))?
    Answer. A single catastrophic failure of GOES-R would not 
compromise our ability to provide coverage. Should GOES-R sustain a 
catastrophic failure, GOES-S is planned to be launched (April 2016) in 
sufficient time to support the planned GOES-R activation in 2017. If 
the GOES constellation were to sustain multiple catastrophic failures, 
then NOAA would continue to rely on potentially degraded support using 
existing satellites from the GOES-N Series, or a degraded single 
satellite constellation located over the central United States.
    Further, NOAA would supplement data needs from all available NOAA 
and non-NOAA polar-orbiting environmental satellites. NOAA also has on-
going international agreements to provide mutual geostationary 
environmental satellite back-up with the European Organisation for the 
Exploitation of Meteorological Satellites (EUMETSAT) and the Japanese 
Meteorological Agency (JMA) in the event of premature system or launch 
failure. This arrangement is based on previous experience of NOAA 
providing backup to JMA, and EUMETSAT providing backup support to NOAA. 
Under the single satellite constellation, NOAA would lose the ability 
to detect and track storms at the edges of the Atlantic and Pacific 
Oceans. This could lead to degraded hurricane forecasting in the 
Caribbean and Atlantic coasts, and Hawaii, respectively.
    Question. If an operational gap were to occur in GOES-R--what 
backup plan exists (e.g., utilizing other systems (allied or 
domestic))?
    Answer. A single catastrophic failure of GOES-R would not 
compromise our ability to provide coverage. Should GOES-R sustain a 
catastrophic failure, GOES-S is planned to be launched (April 2016) in 
sufficient time to support the planned GOES-R activation in 2017. If 
the GOES constellation were to sustain multiple catastrophic failures, 
then NOAA would continue to rely on potentially degraded support using 
existing satellites from the GOES-N Series.
    Further, NOAA would supplement data needs from all available NOAA 
and non-NOAA polar-orbiting environmental satellites. NOAA also has on-
going international agreements to provide mutual geostationary 
environmental satellite back-up with the European Organisation for the 
Exploitation of Meteorological Satellites (EUMETSAT) and the Japanese 
Meteorological Agency (JMA) in the event of premature system or launch 
failure. This arrangement is based on previous experience of NOAA 
providing backup to JMA, and EUMETSAT providing backup support to NOAA.
    Question. If an operational gap does occur--what is the impact to 
short-term forecasting ability?
    Answer. In the event there was a gap in coverage from the 
Geostationary Operational Environmental Satellite (GOES), the most 
immediate impact would be loss in the quality of short term weather 
forecasts and timeliness of data refresh from every 30 minutes with 
GOES to every 6 hours with polar-orbiting satellite data.
    Without GOES, forecasters would be blind to short-term variations 
in hazard weather events such as hurricanes, thunderstorms, flash 
floods, low clouds and fog.
                                 ______
                                 
            Questions Submitted by Senator Dianne Feinstein
                      coastal non-point pollution
    Question. The Coastal Zone Management Act gives authority to 
coastal states to implement a coastal nonpoint polluted runoff control 
program and both the Pew and U.S. Ocean Commissions found that polluted 
runoff is the single greatest source of ocean pollution. How can you 
assure us that coastal states will get adequate funding to carry out 
these coastal water quality programs in the 2007 budget? And because 
the President's 2008 budget provides zero funding for this program, 
what will you do to restore funding for this vital program?
    Answer. Although NOAA was not able to fund the non-point grants 
within the fiscal year 2007 plan, NOAA has funded the Coastal Zone 
Management Grants at $65.7 million. States can reallocate resources 
within their programs to address their highest priorities, including 
the coastal water quality programs. In addition, states benefit from 
NOAA's development and dissemination of management tools and scientific 
research on nonpoint source pollution problems and responses.
    NOAA continues to support state Coastal Nonpoint Source (NPS) 
Management Programs by fostering program integration, and by helping 
coastal states focus on managing the cumulative and secondary impacts 
of development to prevent NPS pollution. NOAA is also investing in 
monitoring, research, and modeling to support NPS management, such as 
through the development, testing and transfer of innovative 
technologies and best management practices to control polluted runoff. 
We are actively pursuing efforts to link coastal growth and development 
management with water quality protection by fostering a greater 
emphasis on community development and planning efforts to address 
growth issues in a sustainable manner.
    The Non Point Implementation Grants have not been included in the 
President's Request for NOAA for a number of years, as significant 
funding for this issue is requested through other Federal Agencies.
    NOAA and the Coastal States Organization (CSO) have undertaken a 
project to engage coastal managers and stakeholders to envision the 
future of coastal management. The goal of this visioning process is to 
gather feedback on priority issues and innovative ideas for improving 
the CZMA and the National Coastal Management Program. State coastal 
managers have identified decreasing water quality as one of the highest 
priority threats to the coastal resources of their states. Workshops 
will be held for stakeholders, coastal management experts and other 
Federal agencies to generate innovative techniques and solutions, 
explore their feasibility, and assess their potential impacts and 
degree of support among constituents.
                     coastal zone management grants
    Question. Funding for California's core coastal management program 
has been capped at $2 million for the past 14 years while population 
growth now finds 1 in 10 Americans living along the California coast. 
Given that funding for coastal management nationally has increased 
during the same period by more than $20 million, are you going to 
allocate funds in the 2007 budget to the large coastal states 
proportionate to their population and length of coastline as mandated 
by the Coastal Zone Management Act?
    Answer. We greatly appreciate the multitude of issues that 
California's coastal management agencies face in managing the 
activities which affect your State's coastal resources. We also 
recognize the effectiveness of the California's coastal management 
efforts which have been consistently documented in our Section 312 
evaluations of your programs.
    As mandated by the CZMA, Section 306 funding is awarded pursuant to 
a formula based on the shoreline mileage and coastal population of each 
state. The fiscal year 2007 funds have been allocated pursuant to this 
formula.
    A $2 million cap on individual state allocations has been put in 
place by Congress for the past 14 years through the appropriations 
process. NOAA has followed this Congressional direction.
               nrdc vs. rodgers settlement implementation
    Question. The National Marine Fisheries Service (NMFS) is a Party 
to the Settlement in NRDC v. Rodgers (concerning restoration of flows 
below Friant Dam in the Central Valley Project) and NMFS has an 
important role to play to ensure the success of the restoration effort 
required by the Settlement, especially the reintroduction of Chinook 
salmon. Could you please tell me what NOAA and NMFS are currently doing 
to support the Settlement implementation effort, what actions are 
proposed in fiscal year 2008 by NOAA and NMFS to further implement the 
Settlement, and what actions are needed, if any, to ensure that the 
Department of Commerce has the necessary staff and resources to fulfill 
its future roles and responsibilities under this major Settlement?
    Answer. NMFS Southwest Regional Office has been actively involved 
in the Settlement since October 23, 2006. NMFS has been working closely 
with the Bureau of Reclamation, Fish and Wildlife Service, parties to 
the Settlement, and third parties on actions required to implement the 
Settlement. We have already provided staff to: (1) brief technical 
working groups and the public on fisheries, fish habitat, and 
Endangered Species Act compliance issues; (2) engage in all 
implementation-related technical and management meetings; (3) answer 
Congressional questions and review draft legislation; (4) provide 
expertise and technical support for the development of implementation-
related documents; and (5) provide management and policy-level guidance 
to the overall Settlement and implementation processes. NMFS is working 
closely with the Bureau of Reclamation's Sacramento Office to secure 
reimbursable funding to support staff to fully implement all of our 
roles under the Settlement. Depending on the availability of funding 
for this Settlement, NMFS will continue working on the 26 items listed 
below in a coordinated and collaborative manner.
    1. Review plans and designs for 14 major structural projects
    2. Analyses, review and provide recommendations on over 500 varying 
flows regimes
    3. Develop and review MOUs including associated budgets
    4. Review numerous contracts
    5. Review several Friant Dam maintenance and operational plans
    6. Review several water right options
    7. Develop and review recirculation, recapture, reuse, exchange or 
transfer of water plans and proposed modifications including monitoring
    8. Review draft development and implementation water plans
    9. Coordinate with 6 State agencies, 5 Federal agencies, tribes, 
and numerous NGOs
    10. Develop and review design, engineering, and monitoring studies
    11. Review potential land acquisitions and easements
    12. Develop and review environmental and permitting documents
    13. Undertake ESA Section 7 consultations and reinitiate 
consultations
    14. Undertake ESA Section 10 consultations and reinitiate 
consultations
    15. Develop and review procedural documents
    16. Analyze, review, and make recommendations on: water year data; 
water flows data and models; riparian corridors habitat models; Chinook 
fall-run and spring-run and steelhead populations
    17. Analyses, review, and make recommendations on: Restoration 
Administrator proposed actions: Technical Advisory Committee proposed 
activities; BOR and FWS proposed actions; CA DWR and DFG proposed 
actions; Secretary of the Interior proposed actions
    18. Participation in numerous technical committees
    19. Provide assistance to Federal and State agencies staffs
    20. Review legal and procedural documents
    21. Provide technical expertise and assist in the development of 
the restoration plans
    22. Develop and execute budgets and financial plans
    23. Make recommendations to Secretary of Commerce
    24. Make recommendations to Secretary of the Interior
    25. Develop and execute monitoring plans
    26. Documentation of all activities for any future court actions
               funding levels for severe weather research
    Question. The overall NOAA budget request for 2008 is less than 2 
percent greater than that for 2006, including reductions in funding of 
$82 million for Oceanic and Atmospheric Research and reductions of $4 
million for the National Weather Service. Given the large impacts of 
severe weather events on our nation's economy and the central role of 
climate change research in preparing our nation to adapt to the 
economic and ecologic impacts of climate change, can NOAA fulfill its 
mission at the funding levels requested in the President's budget? If 
not, what level of additional support is needed to properly address 
these challenges?
    Answer. The President's fiscal year 2008 budget for NOAA requests a 
total of $3.8 billion, an increase of $131 million or 3.4 percent over 
the fiscal year 2007 President's budget. NOAA believes that the fiscal 
year 2008 budget request will allow NOAA to fulfill its obligations. 
The budget request advances mission-critical services, including work 
to expand meteorological prediction and extend our knowledge of 
climatic change.
    The Office of Oceanic and Atmospheric Research (OAR) requests a 
total of $368.8 million in fiscal year 2008, reflecting a net increase 
of $20.1 million from the fiscal year 2007 President's budget and a 
decrease of $10.9 million from the fiscal year 2006 appropriation. The 
decrease from the fiscal year 2006 enacted level is due primarily to 
the large number of un-requested projects in 2006. Even in a tight 
budget year, the fiscal year 2008 budget request supports some new, 
cutting-edge science efforts by OAR's research programs.
    The National Weather Service (NWS) requests $903.5 million in 
fiscal year 2008, reflecting a net increase of $21.6 million over the 
fiscal year 2007 President's budget as well as an increase of $55.2 
million from the fiscal year 2006 enacted level. This budget request 
continues NWS on a path to produce and deliver forecasts that are 
trusted, employ cutting-edge technologies, provide services in a cost-
effective manner, strive to eliminate weather-related fatalities, and 
improve the economic value of weather, water, and climate information. 
The request fully supports NWS forecast and warning operations. NOAA/
NWS is committed to improving operational effectiveness and services, 
particularly for high-impact weather events, by taking full advantage 
of emerging science and technological improvements. We are committed to 
evolving services to best meet the changing and growing need for 
environmental forecasts and services. The NWS's fiscal year 2008 budget 
request supports efforts to upgrade the NEXRAD Radar network by 
implementing dual polarimetric radar. It also supports other efforts 
including: improved numerical modeling, data assimilation, education 
and outreach, training, forecaster workstation (AWIPS) upgrades, as 
well as efforts for future technological advances, such as phased array 
radar (PAR). We believe the President's fiscal year 2008 budget Request 
positions us to make those technical and service improvements.
                                 ______
                                 
            Questions Submitted by Senator Richard C. Shelby
                        ocean initiative funding
    Question. I am pleased to see that NOAA's 2008 budget request 
includes an increase of $123 million for the President's Ocean Action 
Plan, which is in part, related to the Joint Ocean Commission's recent 
reports. As you know, the Senate has been working with the Commission 
to receive specific, real-world guidance on how to improve ocean 
research and education. NOAA's increase is a step in the right 
direction, but based on the Commission's recommendations, the Nation 
still have a long way to go. Admiral, I know you are well aware of the 
Joint Ocean Commission's recent reports, and I know you strive to 
better our nation's ocean research activities. How can the Senate help 
you to ensure that this trend on funding increases and program 
advancements continues?
    Answer. As you are aware, the fiscal year 2008 President's budget 
request includes $123 million in direct support of the President's 
Ocean Action Plan. To continue this positive trend in NOAA's ocean 
programs, please support the President's budget; specifically those 
items that support the Ocean Action Plan. We thank you and your 
colleagues for your continued support of NOAA's ocean programs, and ask 
that you continue to be leaders on ocean and coastal issues on a 
national level.
                       noaa corps reauthorization
    Question. Admiral, the Committee supports NOAA Commissioned Officer 
Corps and the valuable expertise they lend to NOAA's field operations 
and homeland security activities. The Committee understands that the 
NOAA Corps authorization, which regulates the size of the Corps, has 
expired. When can Congress expect the NOAA Corps legislation package to 
be cleared by NOAA?
    Answer. NOAA is interested in reauthorizing the NOAA Corps and we 
look forward to working with the Committee on this important 
legislation. Efforts to consider and possible develop a NOAA Corps 
legislation package are currently underway.

                          SUBCOMMITTEE RECESS

    Senator Mikulski. If there is nothing further, the 
subcommittee will stand in recess.
    [Whereupon, at 11:41 p.m., Thursday, March 8, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]






















  COMMERCE, JUSTICE, SCIENCE, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2008

                              ----------                              


                        THURSDAY, MARCH 15, 2007

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:04 p.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Barbara A. Mikulski (chairman) 
presiding.
    Present: Senators Mikulski, Shelby, Stevens, and Alexander.

             NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

STATEMENT OF HON. MICHAEL D. GRIFFIN, Ph.D., 
            ADMINISTRATOR

                STATEMENT OF SENATOR BARBARA A. MIKULSKI

    Senator Mikulski. Good afternoon, everybody, and welcome to 
the subcommittee hearing of Commerce, State, Justice. The topic 
today will be the appropriations for the National Aeronautics 
and Space Administration (NASA). As we have said earlier, the 
subcommittee was focusing on innovation, security, and 
accountability. Once again, we feel that NASA is the premier 
innovation agency within the United States Government.
    We know that more inventions, technology, and patents have 
come out of NASA than I think is ever fully grasped or fully 
appreciated by the American people, and certainly at times by 
people who wear green eyeshades.
    Today we are going to hear from the NASA Administrator, Dr. 
Mike Griffin, about the agency budget and priorities. Since our 
hearing last year, a NASA civil servant, Dr. John Mather, a 
civil servant at Goddard, won the Nobel Prize, the New Horizons 
Mission has given us new spectacular pictures of Jupiter on its 
way to Pluto. Cassini continues to send its images from Saturn, 
and good old Hubble keeps plugging away, continuing 
extraordinary contributions to science even though it is 
running a little low these days. We have successfully and 
safely returned the Space Shuttle to flight and laid the 
foundation to return to the Moon and eventually to go to Mars.
    For 2008, the President's budget funds NASA at $17.3 
billion, a 6.8-percent increase over the continuing resolution 
level. But when we look at the President's budget over the 2007 
request, it is a 3-percent increase over last year. To put 
NASA's budget in perspective, a $17.3 billion budget represents 
seven-tenths of 1 percent of the entire Federal budget.
    As we looked at science funding we see inside the budget 
request, $5.5 billion, a $300 million increase over the 
continuing resolution, or a $50 million increase when compared 
to the 2007 budget, the budget for science includes funding for 
Hubble servicing, the continuing development of the Webb 
telescope, and other missions. We are very, very pleased that 
these two will be in 2008.
    I do see a significant problem with future science budgets 
because from 2008 to 2011 it only goes up by 1 percent, and we 
will be talking about that with the Administrator.
    For Earth science, the budget shows a cut in funding 
starting next year, and by 2012 the budget for Earth science 
will be $200 million less than in 2008.
    Now, the exciting news is the National Academy of Sciences 
recently released its report on the future of Earth science, 
calling for new Earth science missions by NASA over the next 
decade, 14 of them, and also others to be done by the National 
Oceanic and Atmospheric Administration (NOAA) and one in 
conjunction. Though this year's NASA budget does not 
accommodate any of these new missions, we would like to discuss 
these with the Administrator, get his reaction, and try to find 
a way forward.
    In 1988 the aeronautics budget at NASA was $1.5 billion. 
Today it is $554 million. Every commercial aircraft on-line 
today uses technology developed by NASA and we need to talk 
about our aeronautics program because, after all, when we look 
at its name, it is the national aeronautics, as well as the 
national space program.
    The Space Shuttle budget is $4 billion, the same as 2007 
funding. The administration's budget calls for 14 additional 
flights to space, one to fix the Hubble. We just wonder how the 
Shuttle is doing. We know you have been hit by, was it, ice, 
hail? But our Space Shuttle returned to flight and the safety 
of our astronauts remains our number one priority. So we will 
be asking, how long can we keep the Shuttle going. And of 
course, like the Administrator, we do not want to be in the 
dark on the landing pad with a Shuttle return and not a way 
forward.
    When we talk about exploration, it is a $500 million 
increase over the continuing resolution funding and, quite 
frankly, we are disturbed about the continuing resolution 
funding. If Shelby-Mikulski had passed from the way we did the 
bill, we would have been in a better spot. But you know, we are 
where we are. We know that NASA estimates that it is going to 
cost $16 billion to build Ares and Orion by 2012. We are 
concerned that there will be a 4-year delay between the 
retirement of the Space Shuttle and the launch of Orion and 
Ares. And look at it. The delay is not caused by Congress. As I 
understand, the President's plan also reflects this. But we do 
not want to delay any more than we can.
    The Space Station will receive $2.2 billion, an increase of 
over $300 million, and we know we need to also have a way of 
resupplying it. So as we look ahead, there is no real growth in 
NASA's budget and there is no margin for error or overruns, and 
there is a lot of pressure on the NASA budget and on the 
Administrator on how to coordinate all the pieces that often 
need to move forward in what we hope is a balanced space 
program.
    Senator Hutchison and I will work to increase the top line 
by $1 billion and to repay NASA for the cost of Columbia. We 
also want to salute both Hutchison and Nelson, who are putting 
NASA in the President's authorizing legislation, putting NASA 
in the President's competitiveness agenda, and I will say more 
about that in my questions and answers.
    But no matter how we look at it, we just think that we have 
too many good things for too little money and we are concerned 
about that.
    We intend to, as always, pledge our bipartisan support to 
work with Senator Shelby, with the space Senators, to help 
balance the space program. But I remember over a decade ago 
President Bush's dad and then Vice President Quayle when they 
were contemplating the Space Station and some other 
breakthroughs on a very important Apollo anniversary invited us 
to the White House for a space summit, to kind of get a 
navigational chart on where we wanted to go in space and then 
what would be the revenue stream that we would talk about over 
multiple years.
    I think it is time for another space summit so that we can 
talk over both the President's agenda, the need to continue our 
effort in space science and aeronautics and to make sure that 
our country is number one in innovation, always ahead in 
competition on new ideas and new technology, knowing that we 
have got to get to the Moon, know that China is looming out 
there, and at the same time continue the bold, bodacious space 
exploration that is characteristic of our program.
    So having said that, it is just a direction to suggest and 
discuss, and as always I turn with real warmth and collegiality 
to my ranking member, Senator Shelby.

                 STATEMENT OF SENATOR RICHARD C. SHELBY

    Senator Shelby. Thank you, Madam Chair.
    Dr. Griffin, thank you for joining us here today. This is 
an important hearing because it gives us on the subcommittee an 
opportunity to discuss the significant role of the National 
Aeronautics and Space Administration and its budget proposal. 
NASA's proposed budget for 2008 is $17.3 billion. This is a $1 
billion increase to NASA's base programs or 6.5 percent over 
2007 joint resolution funding level.
    This is by some yardsticks a sizable sum, considering the 
funding constraints that the Federal Government faces in the 
coming fiscal year. But it is not too much money, Dr. Griffin, 
for what we want to do. The requested increase can be 
attributed to $522 million for funding exploration systems 
which will enable NASA to return to the Moon, an additional 
$652 million for the exploration capabilities account, which 
will allow for further construction of the International Space 
Station and other space operations.
    While these are significant increases, the proposed budget 
also contains a reduction of $336 million to aeronautics. Dr. 
Griffin, I think it is important to note that, while this 
budget reflects the President's implementation of the 
exploration vision, it is also grounded in NASA's 2007 request 
rather than the actual funding level provided in the 2007 
funding resolution. This poses many difficulties for this 
subcommittee in developing its proposal for NASA funding in 
2008.
    There are many complex elements required to achieve the 
goal of returning to the Moon. No one knows this better than 
you, Dr. Griffin. First there are the preparatory missions, 
such as the Lunar Reconnaissance Orbiter and Lunar Crater 
Observation and Sensing Satellite, which will launch, I 
understand, in October 2008. The follow-on mission, which is 
expected to launch around 2010 or 2011, has been selected since 
December 2005. Yet the 2008 budget continues to be vague 
regarding a time line for beginning the development work.
    Delaying such preparation missions will only further delay 
man's return to the Moon. I understand that the preparatory 
lunar missions are moving forward and that the crew launch and 
crew exploration vehicles are well into their design and 
development work. Over the past year NASA has refined the Ares 
vehicle to be a five-segment solid rocket booster and selected 
the J-2X engine for its upper stage. This selection will make 
it possible for the Orion capsule to reach the Space Station 
and also be ready for a rendezvous with other vehicles for the 
trip to the lunar surface.
    These are but a few examples of the ongoing work needed to 
make NASA's goals a reality. It is my hope, Dr. Griffin, that 
the implementation of the President's vision can be 
accomplished while maintaining the capabilities that NASA has 
developed in other mission areas. I do not believe that we 
should sacrifice missions and capabilities that will be vital 
to the future of exploration while trying to obtain this goal. 
I believe that we can and should find a balance here.
    Much like last year's hearing, we are reminded today that 
the proposed plan for returning to the Moon is contingent on 
several factors. We are all keenly aware that any unexpected 
bump along the path could pose significant challenges to NASA's 
long-term plans. We can point to the sizable funding 
requirements of flying the Space Shuttle until it retires in 
2010 and the ongoing construction of the International Space 
Station's heavy fiscal burdens on NASA's ability to continue 
down the path laid out in the vision for exploration.
    The continual strains on NASA's budget require that we all 
work together as partners to ensure NASA can meet its many 
objectives.
    Dr. Griffin, I am very interested in you discussing how 
NASA today will preserve its ongoing programs and how it will 
modernize its ongoing programs and how it will modernize its 
institutions and facilities which are critical to NASA's 
success in the coming years. I expect that we will have an 
ongoing dialogue over the course of the year about NASA's 
ability to achieve the Vision for Space Exploration.
    I am also excited by the opportunities that lay ahead 
regarding the exploration vision at NASA. But I must point out 
the fiscal realities that you face every day that have and will 
continue to affect some of these efforts. NASA must show the 
same resourcefulness in operating within fiscal reality on the 
ground as it does in its innovation and can-do spirit for 
exploring space.
    Dr. Griffin, I believe that the subcommittee has made every 
effort to work with you and we will continue to provide NASA 
with the appropriate level of funding to ensure that roles and 
missions are protected and preserved. When such significant 
funds are provided, it is NASA's responsibility to have the 
systems in place to ensure that these funds are spent 
responsibly.
    I am concerned that for the fourth year in a row NASA's 
financial systems have earned the worst rating possible from 
the administration. We were assured in our hearing last year 
that efforts were underway to fix these problems. Yet, 
according to the administration there has been little progress 
since we last met. In addition, the Government Accountability 
Office (GAO) has released its annual high risk report that 
focuses on programs with the greatest vulnerability to fraud, 
waste, and mismanagement. NASA has the unfortunate distinction, 
Dr. Griffin, of having been included in the 1990 inaugural 
edition for its contract management and remains on the high 
risk list to this day.
    Finally, the annual audit of NASA's financial statement by 
an independent auditing firm does not bring me any comfort. 
NASA's finances were disclaimed in both 2005 and 2006 due to an 
inability to provide auditable financial statements as well as 
material weaknesses in its financial systems regarding the 
management of property and equipment. With such assessments of 
NASA's accounting, the agency's $17.3 billion request should be 
backed up, I believe, by solid budget practices, not shoddy, 
unclear bookkeeping. I believe that NASA should be as committed 
to fiscal responsibility to this subcommittee, the 
Appropriations Committee, and the taxpayer as it is to your 
exploration mission, which we commend you for.
    I think, Dr. Griffin, NASA must be better as far as what is 
going on with its books. I look forward, Dr. Griffin, to 
discussing how we may find a solution that keeps all of NASA's 
activities moving forward. It will be a difficult task, given 
the demands for funding across all of the agencies in this 
bill. The administration did not leave many crumbs on the table 
after making severe cuts to, among other things, NOAA and the 
proposed over $1.5 billion in reductions to State and local law 
enforcement. But we are willing to work with you and the 
chairman to ensure that NASA receives the funds necessary to 
achieve the Nation's goals. We look forward to your testimony.
    Senator Mikulski. Thank you.
    Now I would like to turn to Dr. Griffin, but I also want to 
acknowledge--Senator, can you stay for the hearing then? I know 
you have a lot of pressures with Defense.
    Senator Stevens. We have a Defense hearing at 2:30. I will 
have to leave soon, but I would like to hear Dr. Griffin if 
possible.
    Senator Mikulski. As soon as Dr. Griffin finishes, to 
accommodate you, Senator, shall we turn to you then for 
questions? Okay.
    Dr. Griffin. Senator, in deference to your time constraints 
today, I will keep my opening remarks short, but would like to 
enter my opening statement in the record along with my other 
formal statement.
    Senator Mikulski. We also want to note this is the third 
day that you are testifying on NASA budget, two in the House 
yesterday, the authorizers and the appropriators, and this is 
the third.

                ADMINISTRATOR GRIFFIN'S OPENING REMARKS

    Dr. Griffin. Thank you.
    Chairman Mikulski, Senator Shelby, members of the 
subcommittee: I thank you for inviting me here today to discuss 
our $17.3 billion fiscal year 2008 request. I am here today to 
seek your support for that request. The fiscal year 2008 budget 
request is 3.1 percent higher than that requested by the 
President for fiscal year 2007 and demonstrates his commitment 
to maintaining our Nation's leadership role in space 
exploration, scientific discovery, and aeronautics research.
    But it supports many diverse priorities in these 
disciplines and so we need to allocate our resources carefully. 
In this we are guided by the NASA Authorization Act, our annual 
appropriations legislation, Presidential policy, and the 
decadal surveys of the national academies. But even so, we 
cannot afford everything that our many constituencies would 
like us to do. You will not find major strategic changes in the 
fiscal year 2008 budget request as compared to that for last 
year, but you will see some slight course corrections. Overall 
I think we are heading in the right direction and I think we 
have made great strides in the past year and we are on track 
and making progress in carrying out our tasks.
    We have aligned NASA's aeronautics program with the first 
ever presidential policy on aeronautics research and 
development (R&D). The goal of this policy is to ensure that 
NASA and other agencies advance U.S. technological leadership 
in aeronautics.
    We currently operate an armada of over 50 Earth and space 
science satellites and payloads today in orbit around the 
Earth, our Sun, and other planets. The fiscal year 2008 budget 
request provides the resources to launch 10 new science 
missions in that year, most of which involve international 
partners or other U.S. Government agencies. Our $5.5 billion 
portfolio of Earth and space science accounts for almost 32 
percent of the budget.
    It is interesting to develop some perspective on this. 
During the 1960s, the decade of Apollo, science was 17 percent 
of the NASA portfolio. By the early 1990s, it had grown to 24 
percent and today, as I said, it is 32 percent. In contrast, 
NASA's human space flight account during the Apollo years was 
63 percent of the budget and is 62 percent today. So science is 
doing very well at NASA.
    Now, our greatest challenge over the next few years is to 
fly the Space Shuttle safely while using it to finish the 
International Space Station and to do one final Hubble Space 
Telescope mission, and then transitioning to our new systems, 
the Orion crew exploration vehicle and the Ares 1 immediately 
thereafter.
    Human space flight is a strategic capability for this 
Nation. We are now, as you know, facing about 4, 4\1/2\ year 
gap following Space Shuttle retirement when the United States 
will not have its own human space flight capability. Some in 
the Earth and space science community have called for further 
delays in NASA's human space flight efforts in order to allow 
more money to be set aside for science missions. I do not agree 
with this and, in fact, I often wonder what the community of 
scientists would say if they and not the human space flight 
community were facing a 4\1/2\ desert of opportunity.
    If Orion is further delayed, we will be viewed by many as 
ceding our Nation's leadership in human space flight at a time 
when Russia and China have such capabilities and India has 
declared its intention to develop them.
    In 1963 President Kennedy visited Redstone Arsenal in 
Huntsville and posed the following question: ``I know there are 
lots of people now who say, why go any further in space. When 
Columbus was halfway through his voyage the same people said, 
why go on any further? What will we possibly find? What good 
will it be? They want to stop now. I believe the United States 
of America is committed to be first in space, and the only way 
we are going to be first in space is to work as hard as we can 
here and all across the country.''
    I love that quote for its endorsement of the necessity to 
stay the course.
    So when you consider our fiscal year 2008 funding request, 
I ask you to consider our Nation's interests above the 
interests of any individual product, program, or constituency. 
The United States is a recognized leader in space because 
several successive Presidents and Congresses have worked 
together in the past to make the right strategic decisions, but 
this leadership is something we cannot take for granted.

                           PREPARED STATEMENT

    I believe that our budget request today provides you with a 
carefully considered, balanced set of programs for our Nation's 
civil space effort, with world-class Earth and space science, 
strategic capabilities in human space flight, and U.S. 
technical leadership in aeronautics. We need the help of the 
Congress to provide the resources to maintain that leadership.
    Thank you.
    [The statement follows:]
                Prepared Statement of Michael D. Griffin
    Chairman Mikulski and members of the subcommittee, thank you for 
the opportunity to appear today to discuss the President's Fiscal Year 
2008 Budget request for NASA. The President's Fiscal Year 2008 Budget 
request for NASA is $17.3 billion. This represents a 3.1 percent 
increase over the fiscal year 2007 request for the agency, but not the 
enacted fiscal year 2007 appropriation. The fiscal year 2008 budget 
request for NASA demonstrates the President's continued commitment to 
our Nation's leadership in space and aeronautics research, especially 
during a time when there are other competing demands for our Nation's 
resources. The fiscal year 2008 budget request reflects a stable plan 
to continue investments begun in prior years, with some slight course 
corrections. Overall, I believe that we are heading in the right 
direction. We have made great strides this past year, and NASA is on 
track and making progress in carrying out the tasks before us.
    Before I outline the fiscal year 2008 budget request, I would like 
to address the status of NASA's plans for the use of fiscal year 2007 
funding. On February 15, 2007, the President signed into law a joint 
resolution stipulating fiscal year 2007 funding levels for NASA and 
other Federal agencies. This appropriation represents a funding level 
that is $545 million below the President's fiscal year 2007 request. 
The fiscal year 2008 budget request could not possibly factor the 
impact of this reduced level from the fiscal year 2007 request for 
NASA's carefully-considered multi-year programs, and thus, several 
programs in the fiscal year 2008 budget request will be impacted. The 
fiscal year 2007 appropriation further specifies funding levels in 
human spaceflight of that are $677 million below the request--$577 
million of that from exploration systems. This reduction from the 
requested level may significantly impact our ability to safely and 
effectively transition from the shuttle to the Orion Crew Exploration 
Vehicle and Ares I Crew Launch Vehicle. It will have serious effects on 
many people, projects, and programs this year, and for the longer term. 
As I noted during last year's congressional hearings on NASA's fiscal 
year 2007 budget request, we have a carefully balanced set of 
priorities to execute on behalf of our Nation. So as a result of these 
funding levels that are less than the fiscal year 2007 request, NASA is 
carefully assessing the implications to overall exploration priorities 
and milestones, and will present detailed impacts after a full analysis 
is complete. The initial NASA operating plan for fiscal year 2007, 
which, we are endeavoring to finalize as soon as practicable, will 
reflect the impacts of less funding than planned and the requisite 
decisions. As always, we are here to carry out our Nation's civil space 
and aeronautics programs with the resources made available by the 
Congress. All of our programs proceed in a ``go-as-we-can-afford-to-
pay'' manner; so if we receive less funding than requested, we will 
adjust our pace. Our stakeholders have my commitment to continue to 
keep them informed as to what I believe is the best approach to 
carrying out NASA's space and aeronautics research missions with the 
resources provided. In this determination, I will be guided by the NASA 
authorization acts, annual appropriations acts, presidential policy, 
and the decadal survey priorities of the National Academy of Sciences. 
If we determine that there is an agency objective that we will be 
unable to meet, I will inform our agency's stakeholders, including this 
subcommittee.
Highlights of the NASA Fiscal Year 2008 Budget Request
    The fiscal year 2008 budget request for NASA is a carefully 
considered and balanced request formulated over many months with the 
White House. Unfortunately, the Congress had not completed action on 
the fiscal year 2007 budget at the time the fiscal year 2008 budget was 
being finalized, so the impact of the final fiscal year 2007 
appropriation outcome is not accounted for in NASA's fiscal year 2008 
budget request. The fiscal year 2008 budget request weaves together the 
Nation's priorities in space exploration, scientific discovery, and 
aeronautics research that will help fuel this Nation's future, creating 
new opportunities for scientific benefit, economic growth, national 
security, and international cooperation.
    The greatest challenge NASA faces is safely flying the Space 
Shuttle to assemble the International Space Station (ISS) prior to 
retiring the shuttle in 2010, while also bringing new U.S. human 
spaceflight capabilities on-line soon thereafter. We must understand 
that, given proper goals, human spaceflight is a strategic capability 
for this Nation, and we must not allow it to slip away. In January, we 
remembered those whom we have lost in the exploration of space. In the 
aftermath of the Columbia tragedy, President Bush addressed the NASA 
workforce, saying, ``In your grief, you are responding as your friends 
would have wished--with focus, professionalism, and unbroken faith in 
the mission of this agency.'' We must commit ourselves to the focus of 
professionalism and unbroken faith every day in order to carry out the 
tasks before us.
    In analyzing not only the root causes, but also the systemic 
reasons behind the Columbia accident, the Columbia Accident 
Investigation Board (CAIB) made critical observations that guided the 
formulation of our present civil space policy. I fear that with the 
passage of time and the press of other concerns, we may be losing sight 
of some of these principles, so let me reiterate some of them here 
today. First, the CAIB noted that, ``The U.S. civilian space effort has 
moved forward for more than 30 years without a guiding vision.'' 
Second, ``because the shuttle is now an aging system but still 
developmental in character, it is in the Nation's interest to replace 
the shuttle as soon as possible as the primary means for transporting 
humans to and from Earth orbit.'' Third, ``the previous attempts to 
develop a replacement vehicle for the aging shuttle represent a failure 
of national leadership.'' And finally, the board noted that ``this 
approach can only be successful: if it is sustained over the decade; if 
by the time a decision to develop a new vehicle is made there is a 
clearer idea of how the new transportation system fits into the 
Nation's overall plans for space; and if the U.S. Government is willing 
at the time a development decision is made to commit the substantial 
resources required to implement it.''
    Since then, the President, the Congress and NASA have charted a new 
course in U.S. civil space policy that addresses all of these points, 
and the President's Fiscal Year 2008 Budget reaffirms that commitment 
with the necessary funds for the space shuttle and the ISS. NASA will 
continue forward at the best possible pace with the development of the 
Orion and Ares I crew vehicles. However, due to the cumulative effect 
of previously underestimated costs to retire/transition the space 
shuttle and support the International Space Station, the reduction from 
the fiscal year 2007 request reflected in the fiscal year 2007 
continuing resolution, and the maturing design and integrated flight 
tests baselined for the Constellation program, it is unlikely that NASA 
will be able to bring these new exploration capabilities online by 
2014. Full funding of NASA's fiscal year 2008 exploration systems 
request is critical to ensuring the gap between retirement of the space 
shuttle and the new U.S. human spaceflight capability does not grow 
longer. If the gap in our human spaceflight capability extends even 
further than already planned, I believe our Nation will be ceding 
leadership in human spaceflight at a time when China and Russia have 
their own indigenous capabilities and India is developing its own 
capabilities. If we do not quickly come to grips with this issue, 
America may have a prolonged gap between the end of the shuttle program 
and the beginning of Orion and Ares I operational capability, a gap 
similar to the one that occurred from 1975 to 1981 when our Nation 
transitioned from Apollo to the space shuttle.
    NASA has a lot of hard work ahead of it and many major milestones 
this year and next. The transition from the space shuttle to the Orion 
and Ares launch vehicles over the next several years must be carefully 
managed, and we must be focused, professional and committed to our 
mission. This is NASA's greatest challenge, and I ask the 
subcommittee's help in meeting it.
    In the important area of Earth science, we recently received the 
first-ever Decadal Survey for Earth science from the National Academy 
of Sciences, which NASA, the National Oceanic and Atmospheric 
Administration (NOAA), and the United States Geological Survey (USGS) 
requested in 2003. As the first of its kind, the survey has drawn 
considerable attention, and we will observe the programmatic priorities 
for Earth Science which it advocates. In addressing the survey's Earth 
science priorities, and consistent with ensuring that NASA maintains a 
balanced portfolio of science as directed by the NASA Authorization Act 
of 2005 (Public Law 109-155), we have added funding to the Global 
Precipitation Measurement (GPM) mission, the follow-on to the highly 
successful Tropical Rainfall Measuring Mission (TRMM), to improve our 
ability to keep this mission on schedule. Our plan is to launch the 
first core satellite for the GPM mission not later than 2013, followed 
by the second Constellation spacecraft the following year. The fiscal 
year 2008 budget request also augments funding for the Landsat Data 
Continuity Mission (LDCM) and Glory missions in order to help keep 
those projects on schedule. Within planetary sciences, funding has been 
identified for Lunar science research project beginning in fiscal year 
2008 to leverage the many opportunities for payloads on NASA and other 
nations' lunar spacecraft, such as India's Chandrayaan-1, as well as to 
analyze the science data from these missions, including NASA's Lunar 
Reconnaissance Orbiter. In 2008, we will launch a host of Heliophysics 
missions, many with international and interagency partners, to analyze 
the effects of solar flares, coronal mass ejections, and galactic 
cosmic rays. In Astrophysics, the final Hubble servicing mission is 
currently planned for a space shuttle flight in September 2008. And, as 
I advised the Congress and the science community last summer, NASA has 
reinstated the Stratospheric Observatory for Infrared Astronomy (SOFIA) 
mission. Though we know of no technical showstoppers in regard to the 
airworthiness of the aircraft or operation of the telescope, this 
program has some remaining hurdles to overcome and so remains subject 
to a management review later this spring. NASA will launch or 
participate in seven science missions in fiscal year 2007, followed by 
10 missions in fiscal year 2008, resulting in many new Earth and space 
science discoveries in the years ahead.
    The fiscal year 2008 budget request increases the budget profile 
for Aeronautics Research over the President's fiscal year 2007 request, 
aligns our aeronautics activities with the President's recently issued 
Aeronautics Research and Development Policy, and advances U.S. 
technical leadership in aeronautics. NASA has made significant progress 
in reformulating its approach to aeronautics research by collaborating 
with the broad research community including industry, academia, and 
other government agencies including the Federal Aviation Administration 
(FAA) and the Department of Defense (DOD). Through these changes, NASA 
will help ensure that America continues to lead the way in aeronautics 
research.
    NASA continues to monitor and manage our ``uncovered capacity'' 
(employees not directly assigned to specific projects and programs). A 
little over 18 months ago, nearly 3,000 of NASA's 19,000 employees were 
designated as ``uncovered capacity.'' Today, largely with the work 
defined in the Constellation program, we have greatly reduced that 
problem to manageable levels. As of February 2007, we have fewer than 
200 uncovered capacity employees in fiscal year 2007 and fiscal year 
2008. More importantly, many of our best engineers are working 
diligently on the great challenges before us. Every NASA center is now 
vested in our space exploration mission. While we are proud of the 
progress that has been made, significant human capital challenges 
remain. These include matching available skills with the important work 
to be done, managing attrition, retraining and hiring, and improving 
our workforce planning for future years in fiscal year 2009 and beyond. 
To address these challenges and any potential impacts resulting from 
the fiscal year 2007 funding reductions, we have established a new 
intra-agency Workforce Planning Technical Team.
    In addition, beginning in fiscal year 2007, the agency revised 
overhead allocations to simplify how we manage under full cost 
accounting. These changes will ensure a uniform cost rate for all NASA 
civil servants across the agency's government field centers. All 
changes are revenue-neutral to programs and projects; none of NASA's 
missions gain or lose funding as a result of this accounting change. At 
first glance, this accounting change appears to reduce the Aeronautics 
Research budget because so much of that work is done at our smaller 
research centers. However, in actuality, NASA's direct spending for 
Aeronautics Research has increased in the fiscal year 2008 budget 
runout by $205 million through fiscal year 2011 compared to the fiscal 
year 2007 budget runout.
    Beyond our budget request, NASA is beginning to transition the 
workforce, infrastructure, and equipment from the space shuttle to new 
exploration systems. Many of our most experienced people will be 
considering retirement between now and 2010. We will need the means to 
manage this attrition in a targeted manner to achieve better alignment 
of the workforce with our mission without creating unwanted losses and 
skills imbalances. One tool we may be using is the authority for the 
agency to be able to re-employ selected retirees without an offset to 
their annuity--thus giving them an incentive to see a project or 
program to completion. To assist employees with transition to the 
private sector, and to ease that upheaval, another tool would authorize 
NASA to continue their coverage under the Federal Employees Health 
Insurance for 1 year after departure.
    We will also need better tools to manage the transition of our 
facilities. The agency is proposing slight changes and expansion to 
existing authority to permit leasing of underutilized facilities and 
related equipment. The agency would retain the proceeds of those leases 
to be deposited in a NASA capital asset account and invested in 
activities to improve and sustain our facilities and infrastructure. We 
plan to discuss the details of these legislative requests with members 
of Congress in the weeks and months ahead.
    The remainder of my testimony outlines the fiscal year 2008 budget 
request for NASA in greater detail.
Science Mission Directorate
    This past year was truly remarkable for science discovery about the 
Earth, Sun, solar system, and universe. NASA was responsible for 11 
percent of Science News magazine's top stories (covering all fields of 
science) for 2006, which is an all-time record in the 34 years of 
tracking this metric. NASA's findings ranged from new observations of 
familiar phenomena like hurricanes, thunderstorms, and rainfall, to the 
identification of 16 new extra-solar planets orbiting distant stars 
near the center of our galaxy. As NASA continues to add observations 
from long-lived assets such as the Spirit and Opportunity Mars 
Exploration Rovers, it continues to successfully develop and launch the 
next generation of missions and to support a vigorous scientific 
community.
    In 2006, NASA launched four new science missions, one technology 
demonstration mission, and partnered with other Federal and 
international agencies to launch three other science and technology 
missions, as well as the GOES-O satellite, to bring the current total 
number of operational science missions to 52. In January 2006, we 
launched the New Horizons spacecraft to the planet Pluto. Scheduled to 
arrive at Pluto in 2015, the spacecraft made its closest approach to 
Jupiter in late February. With the April 2006 launch of the CloudSat 
and Cloud-Aerosol Lidar and Infrared Pathfinder Satellite Observations 
(CALIPSO) spacecraft, NASA added to the ``A-train'' of satellites 
flying in close proximity around Earth to gain a better understanding 
of key factors related to climate change. In October 2006, NASA's twin 
Solar Terrestrial Relations Observatories mission (STEREO) spacecraft 
were launched to help researchers construct the first-ever 3-
dimensional views of the Sun. Although the two spacecraft will not 
return images until later this year, initial results from STEREO have 
provided us with an unprecedented look at solar activity. On February 
17, 2007, we launched five Time History of Events and Macroscale 
Interactions during Substorms (THEMIS) microsatellites to study the 
Earth's magnetosphere, and we are on track to launch the Dawn mission 
to main belt of asteroids between Mars and Jupiter and the Phoenix Mars 
mission later this year.
    NASA's fiscal year 2008 budget requests $5.5 billion for the 
agency's science portfolio. This represents an increase of $49.3 
million (or 1 percent) over the fiscal year 2007 request and it will 
enable NASA to launch or partner on 10 new missions, operate and 
provide ground support for more than 50 spacecraft, and fund scientific 
research based on the data returned from these missions. For fiscal 
year 2008, NASA separated the Earth-Sun System theme into two themes: 
Earth Science and Heliophysics, and programmatic responsibility for 
studies of Near Earth Objects is transferred to the Exploration Systems 
Mission Directorate.
    The Earth science budget requests $1.5 billion--an increase of 
$27.7 million over the fiscal year 2007 request--to better understand 
the Earth's atmosphere, lithosphere, hydrosphere, cryosphere, and 
biosphere as a single connected system. This request includes 
additional funding for the Global Precipitation Measurement (GPM) 
mission to improve schedule assurance in response to the high priority 
placed on GPM in the Decadal Survey. As the follow-on to the highly 
successful Tropical Rainfall Measuring Mission, NASA's plans to launch 
GPM's first Core satellite no later than 2013, followed by the second 
Constellation spacecraft the following year. The Earth science budget 
also includes increased funding for the Landsat Data Continuity Mission 
and Glory in order to help keep them on their schedules, and provides 
funds for the National Polar-orbiting Operational Environmental 
Satellite System (NPOESS) Preparatory Project (NPP) to reflect 
instrument availability and launch delays. Funds are requested for 
continued development and implementation of the Ocean Surface 
Topography Mission to launch in 2008, the Aquarius mission to measure 
the ocean's surface salinity to launch in 2009, and the Orbiting Carbon 
Observatory mission planned for launch in 2008. NASA will continue to 
contribute to the President's Climate Change Research Initiative by 
collecting data sets and developing predictive capabilities that will 
enable advanced assessments of the causes and consequences of global 
climate change. Over the coming months, NASA will evaluate 
opportunities for implementing the recommendations of the National 
Research Council's Earth Science Decadal Survey and responding to 
challenges to the continuity of climate measurements resulting from the 
Nunn-McCurdy recertification of the NPOESS program.
    The Heliophysics budget request of $1.1 billion will support 14 
operational missions to understand the Sun and its effects on Earth, 
the solar system, and the space environmental conditions that will be 
experienced by astronauts, and to demonstrate technologies that can 
improve future operational systems. During fiscal year 2008, the 
Explorer Program will launch the Interstellar Boundary Explorer (IBEX) 
mission, focused on the detection of the very edge of our solar system, 
and the Coupled Ion-Neural Dynamics Investigation (CINDI) Mission of 
Opportunity conducted by the University of Texas. The Solar Dynamics 
Observatory (SDO) to study the Sun's magnetic field will complete 
launch readiness milestones in fiscal year 2008 and is presently 
scheduled for launch in August of 2008. The Geospace Radiation Belt 
Storm Probes (RBSP) mission, presently in formulation, will undergo a 
preliminary design review and a non-advocate review in fiscal year 2008 
in preparation for entering development in early fiscal year 2009. RBSP 
will improve the understanding of how solar storms interact with 
Earth's Van Allen radiation belts. While the ST-7 and ST-8 missions are 
on track for launches in 2009, the New Millennium ST-9 mission, along 
with follow-on missions, is delayed.
    The planetary science budget request of $1.4 billion will advance 
scientific knowledge of the solar system, search for evidence of 
extraterrestrial life, and prepare for human exploration. NASA will get 
an early start on Lunar science when the Discovery Program's Moon 
Mineralogy Mapper (M3) launches aboard India's Chandrayaan-1 mission in 
March 2008, along with the Mini-RF, a technology demonstration payload, 
supported by NASA's Exploration and Space Operations Mission 
Directorates and the Department of Defense, which may glean water in 
the Moon's polar regions. In addition, the budget requests $351 million 
from fiscal year 2008 to fiscal year 2012 for new Lunar science 
research, including missions of opportunity, data archiving, and 
research. The budget supports the Mars Exploration Program by providing 
for a mission every 26 months, including the Phoenix spacecraft, 
scheduled for launch in 2007, and the Mars Science Laboratory, with a 
launch scheduled for 2009. The Discovery Program's Dawn Mission is 
scheduled to launch later this year, and the Mercury Surface, Space 
Environment, Geochemistry and Ranging (MESSENGER) spacecraft is already 
on its way to Mercury. Three Discovery Mission proposals and three 
Missions of Opportunity were selected in 2006 for Phase A studies, and 
the Discovery Program will invite proposals for additional new missions 
in 2008. With the New Horizons spacecraft continuing on its way to 
Pluto, the New Frontiers Program's Juno Mission will undergo a 
preliminary design review and a non-advocate review in fiscal year 2008 
in preparation for entering development. The New Frontiers Program will 
release its third Announcement of Opportunity (AO) in late 2008.
    The Astrophysics budget requests $1.6 billion to operate NASA's 
astronomical observatories, including the Hubble Space Telescope (HST), 
Chandra X-Ray Observatory, and Spitzer Space Telescope, and to build 
more powerful instruments to peer deeper into the cosmos. HST is 
scheduled for a final servicing mission in September 2008 using the 
space shuttle Atlantis. Along with service life extension efforts, two 
new instruments will be installed during the servicing mission that are 
expected to dramatically improve performance and enable further 
discoveries, including enabling some science observations that have 
been affected by the recent failure of the Advanced Camera for Surveys. 
After the servicing mission, HST will once again have six fully 
operational instruments (including a suite of cameras and spectrographs 
that will have about 10 times the capability of older instruments) as 
well as new hardware capable of supporting at least another 5 years of 
world-class space science. The ESA Herschel and Planck missions, both 
of which include contributions from NASA, will launch in fiscal year 
2008 aboard an ESA-supplied Ariane-5. Kepler instrument and spacecraft 
integration and test will be completed in preparation for launch in 
November 2008, to determine the frequency of potentially habitable 
planets. The Gamma-ray Large Area Space Telescope (GLAST) will launch 
in fiscal year 2008 to begin a 5-year mission mapping the gamma-ray sky 
and investigating gamma-ray bursts. The James Webb Space Telescope will 
undergo preliminary design review and a non-advocate review in fiscal 
year 2008, in preparation for entering development. The SOFIA 
observatory has been reinstated. Though we know of no technical 
showstoppers in regard to the airworthiness of the aircraft or 
operation of the telescope, this program has some remaining hurdles to 
overcome and so remains subject to a management review later this 
spring chaired by the NASA associate administrator. The SOFIA program 
baseline will be finalized at that time.
Exploration Systems Mission Directorate
    The fiscal year 2008 budget request for the Exploration Systems 
Mission Directorate (ESMD) is $3.9 billion to support continued 
development of new U.S. human spaceflight capabilities and supporting 
technologies, and to enable sustained and affordable human space 
exploration after the space shuttle is retired in 2010. With this 
budget, ESMD will continue to develop our next-generation crew 
exploration vehicle, while also providing research and developing 
technologies for the longer-term development of a sustained human 
presence on the Moon. However, due to the cumulative effect of 
previously underestimated costs to retire/transition the space shuttle 
and support the International Space Station, the reduction from the 
fiscal year 2007 request reflected in the fiscal year 2007 continuing 
resolution, and the maturing design and integrated flight tests 
baselined for the Constellation program, it is unlikely that NASA will 
be able to bring these new exploration capabilities online by 2014. 
ESMD will also continue to work with other nations and the commercial 
sector to leverage its investments and identify opportunities for 
specific collaboration on lunar data and lunar surface activities. New 
human spaceflight development of this magnitude, such as the Orion Crew 
Exploration Vehicle, occurs once in a generation. The next 5 years are 
a critical period in our Nation's space flight efforts.
    The Constellation program includes the Orion Crew Exploration 
Vehicle; Ares I, a highly reliable crew launch vehicle; Commercial 
Orbital Transportation Services (COTS) demonstrations of cargo and crew 
transport to the International Space Station; Ares V, a heavy-lift 
launch vehicle; spacesuits and tools required by the flight crews and; 
associated ground and mission operations infrastructure to support 
either lunar and/or initial low-Earth orbit (LEO) missions.
    For fiscal year 2008, pending a full analysis of the fiscal year 
2007 budget impacts, ESMD is on track to maintain its commitments for 
Ares I and Orion, and to continue meeting major milestones. This year 
Constellation will continue to mature and develop overall. Formulation 
of the Constellation elements will continue, leading to the preliminary 
design review in 2008, at which time the program will be baselined. 
NASA will conduct an update for the overall Constellation Systems 
Requirements Review (SRR) in 2007 after the completion of all the 
Program Element SRRs--the Orion Project recently completed its SRR on 
March 1, 2007. ESMD released the Ares I Upper Stage Request for 
Proposals (RFP) on February 23, 2007. The RFP for the Ares I Avionics 
Ring is scheduled for release in May 2007, with selection and contract 
award scheduled for November 2007.
    Facility, equipment, and personnel transitions from space shuttle 
to Constellation will be the major emphasis of the fiscal year 2009 
budget process. NASA transition activities are focused on managing the 
evolution from current operations of the space shuttle to future 
operations of Constellation and emerging commercial services, in a 
safe, successful and smooth process. This joint effort between the 
Space Operations Mission Directorate (SOMD) and ESMD includes the 
utilization and disposition of resources, including real and personal 
property, personnel, and processes, to leverage existing shuttle and 
International Space Station assets for NASA's future exploration 
activities. Formalized transition boards are working to achieve this 
outcome. A Human Spaceflight Transition Plan was developed in 2006; 
updates are in work, and metrics for the plan are being refined and 
will be implemented in 2007.
    In August 2006, NASA signed Space Act Agreements with Space 
Exploration Technologies Corporation, of El Segundo, California, and 
Rocketplane-Kistler, of Oklahoma City, Oklahoma, to develop and 
demonstrate COTS that could open new markets and pave the way for 
commercial providers to launch and deliver crew and cargo to the ISS. 
The Space Act Agreements establish milestones and identify objective 
criteria to assess their progress throughout Phase 1 of the 
demonstrations. In the fiscal year 2008 budget, funding for the 
purchase of crew and cargo transportation services, either from 
international partners or preferably from commercial providers, is 
transferred from ESMD to SOMD. COTS demonstration funding remains in 
ESMD to better exploit potential synergies with the Constellation 
Program.
    With activities in the Advanced Capabilities program, NASA seeks to 
understand the space environment as it relates to human performance by 
addressing respective recommendations from the Exploration Systems 
Architecture Study that was conducted 2005. This included refocusing 
biomedical research and human life-support activities through new 
milestones and requirements to target the timely delivery of research 
products. Accordingly, ESMD created two new programs under Advanced 
Capabilities: the Human Research Program (HRP) to study and mitigate 
risks to astronaut health and performance and the Exploration 
Technology Development Program (ETDP) to enable future exploration 
missions and reduce cost and risk. Plans for 2008 include:
  --Testing of prototype ablative heat shield materials, low-impact 
        docking systems, and landing attenuation systems;
  --testing of advanced environmental control systems on the ISS;
  --developing a lightweight composite command module test article for 
        the Orion;
  --conducting studies to assess risks of long-term radiation exposure 
        and continuing the use of the ISS as a testbed for studying 
        human health and safety in space;
  --spacecraft integration and testing in preparation for the Lunar 
        Reconnaissance Orbiter (LRO) launch in October 2008;
  --next-generation spacesuit capable of supporting exploration; and
  --developing jointly with the U.S. Air Force the RS-68 engine that 
        will be used on the Ares V.
    Finally, the LRO and the Lunar Crater Observatory Sensing Satellite 
(LCROSS) to the Moon is planned to be launched in early fiscal year 
2008. These dual-manifested spacecraft have completed critical design 
review and are currently in development. The science yielded from these 
missions will enable future outpost site selection and new information 
about the deep craters at the lunar poles. The LRO/LCROSS missions 
represent NASA's first steps in returning to the Moon.
Aeronautics Research Mission Directorate
    In 2006, NASA's Aeronautics Research Mission Directorate (ARMD) 
conducted a significant restructuring of its aeronautics program, 
allowing NASA to pursue high-quality, innovative, and integrated 
research that will yield revolutionary tools, concepts, and 
technologies to enable a safer, more flexible, environmentally 
friendly, and efficient national air transportation system. As such, 
ARMD's research will continue to play a vital role in supporting NASA's 
human and robotic space activities. The reshaped Aeronautics Program 
content and direction is consistent with the National Aeronautics 
Research and Development Policy, signed by the President on December 
20, 2006.
    A primary goal across all of the programs in ARMD is to establish 
strong partnerships involving NASA, other government agencies, 
academia, and industry in order to enable significant advancement in 
our Nation's aeronautical expertise. Because these partnerships are so 
important, NASA has put many mechanisms in place to engage academia and 
industry, including industry working groups and technical interchange 
meetings at the program and project level, space act agreements for 
cooperative partnerships, and the NASA Research Announcement (NRA) 
process that provides for full and open competition for the best and 
most promising research ideas. During 2006, ARMD's NRA solicitation 
resulted in the selection of 138 proposals for negotiation for award 
from 72 different organizations representing 29 different States plus 
the District of Columbia. NASA's fiscal year 2008 budget request for 
aeronautics includes $51 million for NRA awards.
    In fiscal year 2008, the President's budget for NASA requests $554 
million for aeronautics research. This budget reflects full cost 
simplification, which significantly reduces the center overhead and 
infrastructure allocated to the aeronautics programs.
    NASA's Airspace Systems Program (ASP) has partnered with the Joint 
Planning and Development Office (JPDO) to help develop concepts, 
capabilities and technologies that will lead to significant 
enhancements in the capacity, efficiency and flexibility of the 
National Airspace System (NAS). Such improvements are critical to meet 
the Nation's airspace and airports requirements for decades to come. In 
fiscal year 2008, NASA's budget request would provide $98.1 million for 
ASP to conduct further research in operational concepts and human-in-
the-loop simulation modeling that supports advancements in automated 
separation assurance capabilities. In addition, ASP will pursue 
enhanced development of airport surface movement trajectory models to 
provide a basis for optimized use of super density airports, integrated 
airport clusters, and terminals where demand for runways is high. Last 
year, ASP took an important step toward this goal by completing 
development of a system-wide operational concept that provides a 
detailed description of future NAS capacity enhancements while 
assessing the benefits of such system improvements. Key to the analysis 
of the operational concepts was program-developed tools such as the 
Airspace Concepts Evaluation System and the Future Air Traffic 
Management Concepts Evaluation Tool, both of which have successfully 
transitioned from NASA to the Federal Aviation Administration and the 
JPDO.
    NASA's Fundamental Aeronautics Program (FAP) conducts research in 
the engineering and scientific disciplines that enable the design of 
vehicles that fly through any atmosphere at any speed. The fiscal year 
2008 budget request, amounting to $293.4 million, will enable 
significant advances in the hypersonics, supersonics, subsonic fixed 
wing, and subsonic rotary wing projects that make up the FAP. These 
projects focus on creating innovative solutions for the technical 
challenges of the future: increasing performance (range, speed, 
payload, fuel efficiency) while meeting stringent noise and emissions 
constraints; alleviating environmental and congestion problems of the 
Next Generation Air Transportation System (NGATS) through the use of 
new aircraft and rotorcraft concepts; and, facilitating access to space 
and re-entry into planetary atmospheres. A wide variety of cross-
cutting research topics are being pursued across the speed regimes with 
emphasis on physics-based multidisciplinary analysis and design, 
aerothermodynamics, materials and structures, propulsion, aero-servo-
elasticity, thermal protection systems, advanced control methods, and 
computational and experimental techniques. A number of key activities 
are planned for fiscal year 2007 and fiscal year 2008 including the 
launch of a suborbital rocket to conduct flight experiments in 
hypersonic boundary layer transition and re-entry shapes, the flight 
test of scale models of the X-48B Blended Wing-Body concept to assess 
this advanced unconventional airframe configuration for its potential 
to decrease aircraft noise while also improving performance, the 
evaluation of radical new concepts for variable-speed rotor 
technologies that can result in highly improved performance, and the 
evaluation of actively-controlled inlets for supersonic transports.
    The fiscal year 2008 budget request for NASA's Aviation Safety 
Program (AvSP) is $74.1 million. The four projects within the program 
(Integrated Intelligent Flight Deck, Integrated Resilient Aircraft 
Control, Aircraft Aging and Durability, and Integrated Vehicle Health 
Management) will develop cutting-edge tools, methods, and technologies 
with close coordination among them to improve the intrinsic safety 
attributes of current and future aircraft that will operate in the 
NGATS. In fiscal year 2008, the program will complete a study of human-
automation technology that will improve safety during approach and 
landing operations by allowing for active operator assistance that 
maintains appropriate levels of workload and will be conducted to 
evaluate neural networks for direct adaptive control that will maximize 
adaptation to simulated in-flight failures while minimizing adverse 
interactions. At the same time, onboard sensor technology will be 
developed and validated to achieve significant improvement in measuring 
atmospheric water content that will improve the ability to detect the 
onset of potential icing hazards. Challenges related to aircraft aging 
and durability will also be addressed by developing models capable of 
simulating the initiation and propagation of minute cracks in metallic 
materials.
    Finally, NASA's Aeronautics Test Program (ATP) will continue to 
safeguard the strategic availability of a critical suite of aeronautics 
test facilities that are deemed necessary to meet agency and national 
aeronautics needs. The fiscal year 2008 budget request for ATP is $88.4 
million, which will enable strategic utilization, operations, 
maintenance and investment decisions for major wind tunnel/ground test 
facilities at Ames Research Center, Glenn Research Center and Langley 
Research Center and for the Western Aeronautical Test Range support 
aircraft and test bed aircraft at Dryden Flight Research Center. In 
fiscal year 2006, NASA implemented procedures to ensure affordable and 
competitive pricing of its aeronautics facilities for use by other 
parties, including industry and university researchers. In fiscal year 
2008, ATP plans to continue ensuring competitive prices for ATP 
facilities, reducing a backlog of maintenance issues and investing in 
advanced technologies such as installing consistent angle of attack 
instrumentation at the research centers.
Space Operations Mission Directorate
    This was an extraordinary year for the space shuttle and 
International Space Station (ISS) programs. NASA celebrated 
Independence Day 2006 by launching space shuttle Discovery on the STS-
121 mission. The second of two test flights (the first was STS-114 in 
July/August 2005), STS-121 helped validate the improvements made to the 
space shuttle system since the loss of Columbia on February 1, 2003. 
The mission also marked the return of a complement of three crewmembers 
to the ISS. The space shuttle Atlantis (STS-115), which launched on 
September 9, marked a return to sustained space shuttle operations and 
placed NASA on track to completing assembly of the ISS by 2010. STS-115 
delivered the critical P3/P4 truss to the ISS, which will provide a 
quarter of the power services needed to operate the completed research 
facility. The last flight in December 2006, STS-116, was devoted 
primarily to deactivating the electrical power systems on the U.S. 
segment of the ISS and making a series of electrical and coolant 
connections between the P3/P4 truss segment and the rest of the 
station. To do this, flight controllers at the mission control centers 
in Houston and Moscow uplinked over 17,900 commands to the ISS during 
the mission--all without a single unplanned or command error. STS-116 
crewmember Robert Curbeam also set a record for the most spacewalks 
ever conducted by an astronaut on a single space shuttle mission, with 
four excursions totaling over 25 hours.
    Operational activities onboard the ISS have continued into 2007, 
with a series of spacewalks that reconfigured the thermal system on the 
station and prepared us for future assembly tasks. The station is now 
able to provide additional power to the space shuttle, allowing two 
extra docked days, and we have connected permanent systems in place of 
temporary ones. The sequence of three complex spacewalks within 9 days 
also demonstrated capabilities we will need later this year to fully 
install Node 2 following its delivery on STS-120.
    These mission achievements reflect the NASA team's dedication to 
safely and successfully flying out the space shuttle program and 
meeting our Nation's commitments to our international partners. The 
program's successes also led to the decision in October 2006 to move 
forward with plans for a final servicing mission to the Hubble Space 
Telescope (HST). Following an extensive review by the relevant NASA 
offices of all safety and technical issues associated with conducting 
such a mission, it became clear that an HST servicing mission could be 
carried out effectively and safely. While there is an inherent risk in 
all spaceflight activities, the desire to preserve a truly 
international asset like the HST makes doing this mission the right 
course of action.
    The space shuttle fiscal year 2008 budget request of $4.01 billion 
would provide for five shuttle flights, including four ISS assembly 
flights as well as the HST servicing mission. The ISS assembly flights 
include the launch of major research facility modules from the European 
Space Agency and Japan. The Canadian Special Purpose Dexterous 
Manipulator robotic system will also be flown in 2008. These flights 
are a major step towards fulfilling U.S. commitments to NASA's 
international partners as specified in the ISS agreements and the 
Vision for Space Exploration.
    The fiscal year 2008 budget request includes $2.24 billion for ISS 
activities. NASA has consulted with our international partners on the 
configuration of the ISS, and is working closely with them to determine 
the detailed plans for logistics required during and after assembly. 
The fiscal year 2008 budget request provides the necessary resources to 
purchase Soyuz crew transport and rescue for U.S. astronauts as well as 
progress vehicle logistics support for the ISS from the Russian Space 
Agency.
    As the shuttle approaches its retirement, the ISS Program intends 
to use alternative cargo and crew transportation services from 
commercial industry. Once a capability is demonstrated in phase 1 of 
the Commercial Orbital Transportation Services (COTS) Space Act 
Agreements, NASA plans to purchase cargo delivery services 
competitively in phase 2 and will decide whether to pursue crew 
demonstrations. In the fiscal year 2008 budget, funding for the 
purchase of crew and cargo transportation services, either from 
international partners or preferably from commercial providers, is 
transferred from the Exploration Systems Mission Directorate to the 
Space Operations Mission Directorate. One item of significance in the 
fiscal year 2008 budget runout, especially in the out-years, is that it 
allows for increases to our previously estimated costs for purchasing 
commercial cargo and crew services to support the ISS, assuming these 
commercial services are successfully demonstrated and are cost-
effective. Should costs for those services be greater than what is 
presently budgeted, NASA has accepted a management challenge to scale 
back on our space operations costs and will curtail some of our robotic 
lunar exploration or long-term exploration technology development in 
the out-years. COTS demonstration funding remains in ESMD to better 
exploit potential synergies with the Constellation Program.
    The space shuttle program's highest priority is to safely complete 
the mission manifest by the end of fiscal year 2010, using as few 
flights as possible. Working through formalized transition control 
board processes, the space shuttle program will also play a key role in 
coordinating the smooth transition of space shuttle assets and 
capabilities to the next generation of exploration systems without 
compromising the safety of ongoing flight operations. The greatest 
challenge NASA faces is safely flying the space shuttle to assemble the 
ISS prior to retiring the shuttle in 2010, while also bringing new U.S. 
human spaceflight capabilities on-line soon thereafter. There are a 
number of major transition milestones set for fiscal year 2008, 
including the transition of one of the four high bays in the vehicle 
assembly building and launch pad 39B to the Constellation Systems 
Program. Space shuttle Atlantis may also be retired in fiscal year 2008 
after the HST SM-4 mission and its systems and parts would be used to 
support the remaining space shuttle orbiters, Discovery and Endeavour, 
during the program's last 2 years of operations. The fiscal year 2008 
budget request reflects the current assessment of costs to retire the 
space shuttle. Over the next year, NASA will develop additional detail 
and refine our cost estimates for the transition.
    The fiscal year 2008 budget also provides for the procurement of 
two additional Tracking and Data Relay Satellite System (TDRSS) 
satellites to replenish the Constellation. NASA projects that the 
availability of aging TDRSS satellites to support overall user demand 
will be reduced by 2009 and depleted by 2015. In order to continue to 
support all users, NASA must begin the procurement process immediately, 
with planned launches in fiscal year 2012 and fiscal year 2013. By 
replenishing the satellites, NASA will be able to meet overall user 
demand through 2016. The Space Operations Mission Directorate has 
partnered with non-NASA users to provide a proportionate investment in 
the replacement capabilities.
Cross-Agency Support Programs
    The fiscal year 2008 budget request for activities within the 
Cross-Agency Support Programs (CASP)--education, advanced business 
systems, innovative partnerships programs, and Shared Capabilities 
Assets Program--is $498.2 million. Within this amount, $34.3 million is 
for the Shared Capability Assets Program (SCAP), which is designed to 
ensure that critical capabilities and assets (e.g. arc jets, wind 
tunnels, super computing facilities, rocket propulsion testing, etc.) 
required agency-wide are available to missions when needed. The fiscal 
year 2008 budget request for Advanced Business Systems, comprising the 
Integrated Enterprise Management Program (IEMP), is $103.1 million. 
Fiscal year 2007 and fiscal year 2008 funding will support IEMP in 
implementing capabilities that improve NASA's tracking and 
accountability of its property, plant, and equipment; integrate human 
capital information, providing employees and management with new, 
secure tools for accessing personnel data, and planning and budgeting 
NASA's workforce; and, provide more relevant and accurate financial 
information in support to NASA's programs and projects. This funding 
also supports ongoing operations and maintenance of NASA's financial 
system and other agency-wide business systems.
    For NASA's education activities, the fiscal year 2008 budget 
request totals $153.7 million and sustains our ongoing commitment to 
excellence in science, technology, engineering, and mathematics (STEM) 
to ensure that our agency is equipped with the right workforce to 
implement the Vision for Space Exploration. NASA will continue the 
tradition of investing in education and supporting educators who play a 
key role in preparing, inspiring, exciting, encouraging, and nurturing 
the youth who will manage and lead the laboratories and research 
centers of tomorrow. NASA education is committed to three primary 
objectives to help improve the state of STEM education in our country: 
strengthen the Nation's and NASA's future workforce; attract and retain 
students in the STEM discipline and; engage the American people in 
NASA's missions through partnerships and alliances.
    The Innovative Partnerships Programs (IPP) provides leveraged 
technology investments, dual-use technology-related partnerships, and 
technology solutions for NASA. The fiscal year 2008 budget request for 
IPP activities is $198.1 million. The IPP implements NASA's Small 
Business Innovative Research (SBIR) and Small Business Technology 
Transfer (STTR) programs that provide the high-technology small 
business sector with an opportunity to develop technology for NASA. 
Recently, NASA has made some changes to the management structure of 
these two programs to better enable technology infusion and to increase 
the efficiency of the operations. IPP also manages the Centennial 
Challenges Program. NASA has already benefited from the introduction of 
new sources of innovation and technology development even though the 
program is relatively new and no prizes have yet been awarded. In 
addition, ongoing and future prize challenges will continue to inspire 
brilliant young minds.
                               conclusion
    NASA has many challenges ahead of us, but we are on track and 
making progress in managing these challenges. The fiscal year 2008 
budget request demonstrates commitment to our Nation's leadership in 
space and aeronautics research, and while we may face a significant 
funding reduction for fiscal year 2007, we will carry on, though not at 
the pace we had previously hoped.
    I ask your help to ensure this Nation maintains a human spaceflight 
capability. Without stable funding as requested in this budget, we face 
the very real possibility of allowing that capability to slip away for 
the foreseeable future--even as other nations continue to develop 
similar capabilities.
    I also need your help to effectively transition key elements of our 
space shuttle workforce, infrastructure, and equipment to our Nation's 
exploration objectives. The provisions I referenced earlier, as well as 
stable funding, will help ensure we preserve a critical and unique 
industrial base capability that has allowed the United States to lead 
the world in space exploration.
    Again, thank you for the opportunity to appear before you today. I 
would be please to respond to any questions that you may have.

            NATIONAL AERONAUTICS AND SPACE ADMINISTRATION PRESIDENT'S FISCAL YEAR 2008 BUDGET REQUEST
                                     [Budget authority, dollars in millions]
----------------------------------------------------------------------------------------------------------------
                                                 Fiscal      Fiscal     Fiscal     Fiscal     Fiscal     Fiscal
            By Mission Directorate              year 2007  year 2008  year 2009  year 2010  year 2011  year 2012
----------------------------------------------------------------------------------------------------------------
Science, Aeronautics and Exploration:
    Science:
        Earth Science........................   $1,469.6    $1,497.3   $1,539.7   $1,500.7   $1,411.2   $1,353.2
        Heliophysics.........................   $1,028.1    $1,057.2   $1,034.5   $1,107.1   $1,241.2   $1,307.5
        Planetary Science....................   $1,406.1    $1,395.8   $1,676.9   $1,723.9   $1,738.3   $1,748.2
        Astrophysics.........................   $1,563.0    $1,565.8   $1,304.2   $1,268.9   $1,266.2   $1,393.8
                                              ------------------------------------------------------------------
          Subtotal, Science..................   $5,466.8    $5,516.1   $5,555.3   $5,600.6   $5,656.9   $5,802.7
                                              ==================================================================
    Exploration Systems:
        Constellation Systems................   $3,232.5    $3,068.0   $3,451.2   $3,784.9   $7,666.0   $7,993.0
        Advanced Capabilities................     $920.0      $855.8     $861.6     $973.0   $1,059.1   $1,083.9
                                              ------------------------------------------------------------------
          Subtotal, Exploration Systems......   $4,152.5    $3,923.8   $4,312.8   $4,757.8   $8,725.2   $9,076.8
                                              ==================================================================
    Aeronautics Research: Aeronautics             $529.3      $554.0     $546.7     $545.3     $549.8     $554.7
     Technology..............................
                                              ==================================================================
    Cross-Agency Support Programs:
        Education............................     $167.4      $153.7     $152.8     $152.7     $149.8     $149.6
        Advanced Business Systems............      $97.4      $103.1      $69.4      $71.6      $67.6      $67.5
        Innovative Partnerships Program......     $215.1      $198.1     $197.2     $199.8     $200.0     $200.0
        Shared Capability Assets Pro-  gram..      $22.1       $34.3      $34.2      $36.2      $37.3      $37.2
        Continuing Resolution Rate \1\.......   ($555.60)  .........  .........  .........  .........  .........
                                              ------------------------------------------------------------------
          Subtotal, Cross-Agency Support          $502.0      $489.2     $453.5     $460.4     $454.7     $454.4
           Programs..........................
                                              ==================================================================
          Total, Science, Aeronautics and      $10,650.6   $10,483.1  $10,868.4  $11,364.2  $15,386.5  $15,888.6
           Exploration.......................
                                              ==================================================================
Exploration Capabilities:
    Space Operations:
        Space Shuttle........................   $4,017.6    $4,007.5   $3,650.9   $3,634.4     $116.2  .........
        International Space Station..........   $1,762.6    $2,238.6   $2,515.1   $2,609.2   $2,547.5   $2,600.8
        Space and Flight Support.............     $328.1      $545.7     $544.3     $382.0     $372.9     $377.2
        Continuing Resolution Rate \1\.......     ($40.9)  .........  .........  .........  .........  .........
                                              ------------------------------------------------------------------
          Total, Space Operations............   $6,108.3    $6,791.7   $6,710.3   $6,625.7   $3,036.6   $2.978.0
                                              ==================================================================
Inspector General............................      $33.5       $34.6      $35.5      $36.4      $37.3      $38.3
    Continuing Resolution Rate \1\...........      ($2.0)  .........  .........  .........  .........  .........
                                              ------------------------------------------------------------------
      Total..................................  $16,792.3   $17,309.4  $17,612.2  $18,026.3  $18,460.4  $18,905.0
                                              ==================================================================
Year to Year Change \2\ (percent)............  ..........        3.1        1.8        2.3        2.4        2.4
----------------------------------------------------------------------------------------------------------------
\1\ Fiscal year 2007 column represents the 2007 President's Budget in full-cost simplification and shown in the
  new Theme structure.
\2\ Modification to fiscal year 2007 if current continuing resolution is extended for entire year, and assuming
  $126.1 million institutional mission support transfers from Exploration Capabilities to Science, Aeronautics
  and Exploration not included in totals.

Totals may not add due to rounding.

    Senator Mikulski. I have also read your written oral 
testimony particularly, and I appreciate, in the interest of 
time, pages 4, 5, and 6, which I think go to the meat of the 
issues around the continuing resolution, the way forward, 
flashing yellow lights about what will be done when, and 
workforce impact issues, which I know are of keen impact to not 
only those who are currently here, but to certainly extensive 
conversations with Senator Shelby, Senator Sessions, Senator 
Hutchison, and Senator Nelson, which goes to essentially where 
we are in this year's appropriation.
    I am going to ask you a question and if you feel 
comfortable answering it, fine. If not, I understand. But my 
question is, when we look at 2008 what did you ask for from the 
Office of Management and Budget (OMB) and therefore what did 
you get that we would also have to take into consideration, not 
only in terms of the increase that was in the President's 
budget? Because the 3 percent just kind of keeps us almost at 
inflation.
    Dr. Griffin. That is correct, ma'am. I am not able to delve 
into discussions that go on within the Executive Office of the 
President. I will say that everyone gets a full opportunity to 
air their views. I've got mine. Ultimately decisions are made 
and when the President signs his name to that budget it becomes 
his submission, and I work for him and must support that.
    Senator Mikulski. Dr. Griffin, I respect that and I respect 
that confidentiality. But that is also--see, I think the 
President has a vision of where he wanted to go and I think you 
are in alignment with that vision. But I think that there is a 
gap here with the OMB view of the vision, which is why I would 
like us all to get in the room as kind of a space summit. And I 
say that in the most friendly way. It worked so well with the 
President's father and Vice President Quayle.
    Let me move--so just know, I think we all know where we 
want to go. It is how can we get there.
    Dr. Griffin. I admire and am very grateful for the support 
that you have given to the space program on a bipartisan basis, 
regardless of who is in charge when, and I know that that will 
continue.
    Senator Mikulski. Sure.
    Dr. Griffin. Thank you.

                         HUBBLE SPACE TELESCOPE

    Senator Mikulski. Let us go to the Hubble telescope. What 
is the current launch date for the Hubble servicing mission and 
does your fiscal year 2008 budget fully fund the servicing 
mission?
    Dr. Griffin. Well, the current date is September 2008 for 
the Hubble servicing mission. The fiscal year 2008 budget, of 
course, does not support that because the fiscal year 2008 
budget was prepared and submitted by me and determined by the 
OMB before we had ascertained that we could do the Hubble 
servicing mission. You were with me. We announced----
    Senator Mikulski. I remember it.
    Dr. Griffin [continuing]. That last October. We had been 
hoping for a spring 2008 launch and what we have is a September 
2008 launch, which is 4 months different, because of the 
necessity to first of all be certain that we could get the 
servicing mission hardware to the pad in time, and April or May 
would have been very dicey. Then second of all, we wanted to 
have a launch on need capability if there were a rescue 
mission.
    Senator Mikulski. Dr. Griffin, I know we have talked about 
this.
    Dr. Griffin. Right, okay. Sorry.
    Senator Mikulski. Safety of the astronauts. What I hear is 
that you have the financial resources----
    Dr. Griffin. So I need to find $40 million in the 
astrophysics budget and I will do that.
    Senator Mikulski. But it is a $40 million price tag which 
is not now currently in the 2008 framework; am I correct in 
that?
    Dr. Griffin. That is correct, ma'am.
    Senator Mikulski. So we will have to work together on that. 
And again, we are just identifying kind of a must-do list that 
we need to go down.

                        EARTH OBSERVING SENSORS

    Now, I found interesting your commentary on the science 
budget, now 32 percent, which carries us through, of course, 
2012. But at the same time, what we are concerned about is 
these years into the future, one of which is 40 percent--now 
let us go to Earth observing. Forty percent of the Earth 
observing sensors now in orbit are going to kind of end by the 
end of the decade unless they are replaced.
    As you look ahead, is there money now in this year's 
appropriation to make a down payment on replacing these 
sensors? Do you see replacing these sensors? Where do you see 
going with that?
    Dr. Griffin. You, of course, ask a very good question.
    Senator Mikulski. That is our bread and butter, am I 
correct, apart from new ideas and new National Academy of 
Sciences recommendations?
    Dr. Griffin. We certainly have to keep in place the Earth 
sensing, climate resource programs and the data. The continuity 
of the data is crucial and we have to keep that in place. Now, 
I need to take you back for just a moment to decisions made 
some years ago that all of this climate research capability 
would be put on the national polar-orbiting operational 
environment satellite system (NPOESS) program, which is a 
Department of Defense (DOD), NOAA, and NASA program. So NASA 
climate research dollars were diverted to NPOESS.
    Now, NPOESS breached the Nunn-McCurdy and so the climate 
research sensors will not be on that. So we have asked the 
National Academy of Sciences for a study; and we are doing 
ourselves a study to determine, for OSTP, how we are going to 
recover from the loss of climate information that was to be 
provided by NPOESS and how we are going to incorporate that 
into the Earth science program.
    We will have those studies by some time this spring. We 
will be factoring that into our planning for the 2009 request 
and beyond, because we have to adapt now to a changed set of 
circumstances that we did not anticipate.
    Senator Mikulski. Well, I know my time has expired, but 
with the indulgence of my ranking member, because he and I 
thought--we had NOAA in here last week, I think, and we were 
pretty robust in our questioning around the need for 
accountability on NPOESS. We are very disappointed at the 
enormity of the overrun, the fact that we were glad that the 
McCurdy stepped in, but now we asked Admiral Lautenbacher, what 
are you going to do about this and how are you going to 
implement the recommendations.
    But as you know, it was a three-headed thing. It was NOAA, 
NASA, and the Air Force. I do not think we would ever go for 
that kind of thing again. But where do you see yourselves 
coming in, not only with the loss of Earth science capability, 
but then also for the fiscal stewardship necessary for both 
your role that when NPOESS flies you are still going to be 
involved, ``you'' meaning NASA, is still going to be involved 
with NPOESS.
    So where do you see your fiscal stewardship? And then when 
this happens in May, we do want to talk to you about climate 
change, the climate crisis, because I think we all agree this 
is where the American people want us to be working as well.
    Can you help us out here?
    Dr. Griffin. Well, we absolutely intend to discuss with you 
the recommendations that come out of these two studies in 
connection with how we will continue our climate research.
    Senator Mikulski. That is how we are going to continue the 
research. But you know, it was not only NOAA that dropped the 
ball on the NPOESS. The Air Force played a big role in this and 
so did NASA.
    Dr. Griffin. NASA does not have money in the NPOESS 
program.
    Senator Mikulski. But you were all part of developing the 
NPOESS and they, as they look at some of the issues here, feel 
that it was also NASA that played a role, as did the Air Force, 
in part of these overruns. Are you with me?
    Dr. Griffin. I hear what you say and I understand you, but 
I do not think that NASA had any role in the NPOESS overruns 
and shortfalls.
    Senator Mikulski. Well, I do not want to use my time going 
down this path, but when we talked with Admiral Lautenbacher 
last week, and we talked with him both publicly and I had a 
conversation with him about it, because this is really a big 
ticket item, as you know, about what was our way forward. He 
seemed to also feel that there was a NASA role. So we need to 
be able to talk about this and talk about it, so it is not only 
about the climate change.
    But I am going to turn to Senator Shelby and Senator 
Alexander. I will come back with some more of this.

                     MANNED FLIGHT OF ORION VEHICLE

    Senator Shelby. Thank you, Madam Chairman.
    Dr. Griffin, you have indicated that unless there are 
additional funds provided in the next few fiscal years to NASA 
that the first manned flight of Orion will not be until 2015 
perhaps, instead of 2014 as called for in the recent NASA 
authorization bill. The additional funds beyond those already 
in the budget that would be required to have an operable 
replacement for the Shuttle I understand would be $350 million 
in 2009 and an additional $400 million in 2010.
    In response to the funding levels provided by NASA for 
2007, does NASA anticipate making any supplemental requests or 
sending a budget amendment to the subcommittee in the months 
ahead to try to make up this shortfall?
    Dr. Griffin. We are discussing within the administration 
what the way forward is, but I cannot say at this time. I 
simply do not know whether we would be making an amended 
request or change plans going forward.

                PRECURSOR PROGRAM FOR LUNAR EXPLORATION

    Senator Shelby. Senator Mikulski and a number of us that 
support NASA believe you need more money for what you are 
called upon to do. Lunar precursor missions. In 2005 the NASA 
authorization act directed NASA to institute a robust precursor 
program for lunar exploration. In December 2005, NASA awarded a 
follow-on mission, the RLEP as it was called then, to a team 
from the Marshall and Goddard Space Flight Centers, with 
Marshall as the lead.
    Last year before the subcommittee you stated that this 
mission would be done in a timely way as a precursor mission, 
but would not start until 2007. In your hearing with the House 
Appropriations Committee early this week, it was my 
understanding that you mentioned that all the information NASA 
will need for a return to the Moon can be obtained from orbit. 
This seems to indicate that the precursor mission will never 
happen. If I am wrong, can you correct me on that?
    Can you explain if the requirements have changed between 
2005 and today and align that position with the direction of 
NASA's authorization language for having a robust precursor 
program? In other words, what is the current status of this?
    Dr. Griffin. The information that we feel that we need--and 
this conclusion has been reached in discussion with our NASA 
advisory councils, science groups, as well as internally--the 
conclusions we have reached are that the information we need 
before putting people back on the Moon can be obtained with 
lunar reconnaissance orbiter. The surface science and 
technology that we would like to do is something we would like 
to do, but it is not essential.
    Because funding is very tight, we have a choice between 
doing lunar surface science and technology with robotic 
precursors early on. If we do that, we will delay the 
development of the Ares launch vehicle and the Orion crew 
vehicle by another 6 months. So if I undertake that work, I 
will delay Orion and Ares even further. That is work not yet 
started, and so when budgets are tight my normal first choice 
is to delay work not yet started rather than to cancel work, 
and my normal choice is to delay work which is nice to have but 
not essential, and that is what we will be doing here.

                  PROPULSION RESEARCH AND DEVELOPMENT

    Senator Shelby. In the area of propulsion, we talked about 
this before. The Vision for Space Exploration will require many 
new technologies and systems to be developed in order to 
maximize our investment on returning to the Moon. One of these 
areas will require ongoing research and development in this 
area of propulsion. Marshall Space Flight Center has expertise 
in this area and has continued working on propulsion systems 
from the time of the last missions to the Moon to the present.
    As the work continues on the research and development on 
Vision-related vehicles and systems, what do you anticipate 
will be the need for propulsion research and development this 
year and in the future?
    Dr. Griffin. I do not need propulsion research to get back 
to the Moon. I need propulsion systems development, if you 
will, and that is going on at the Marshall Space Flight Center 
and through its contractors, and they are doing, frankly, a 
very good job. I am quite pleased with them. They will be busy 
with the redevelopment of the Nation's space propulsion 
capabilities for an upper stage and rocket capabilities for the 
foreseeable future.
    So Marshall is fully occupied helping us first replace the 
Shuttle and then after that return to the Moon. I would like to 
say, believe me, I would very much like to be doing advanced 
research in propulsion. But as with other things in the budget, 
there is a difference between must have and nice to have, and 
right now what I must have is working propulsion systems, and 
what would be nice to have is advanced propulsion research.

   AGING NATIONAL AERONAUTICS AND SPACE ADMINISTRATION INFRASTRUCTURE

    Senator Shelby. Dr. Griffin, a lot of the NASA facilities 
have aged and deteriorated, as you well know. A lot of us 
believe there is significant need for infrastructure. Do you 
have any plan for that? What can we do to help you? I know we 
are the money Committee to appropriate money. We have those 
challenges at Marshall. You have them at Goddard, you have them 
at Kennedy Center, you have them in Florida.
    Dr. Griffin. Sure. Sir, most of the NASA infrastructure, as 
you know, is 40 some years old and more. Even at that, it is 
not as old as many other Government facilities, but that is as 
it is. We are working on an agency-wide facilities plan right 
now. It will be done shortly. We are working with the Office of 
Management and Budget to finalize that, and it will cover the 
detailed data for the fiscal year 2008 construction of 
facilities, including repair, rehabilitation, renovation, 
replacement on existing systems, as well as any new things that 
we need.
    It will describe about a little more than a $6 million 
strategic initiative to address our facilities repairs and 
upgrades that are needed. Now, with regard to returning to the 
Moon, we are going to make every effort to use existing 
facilities. We would only propose building a new facility if 
something that the U.S. Government already owns just does not 
make the grade. But we will discuss that, the strategic plan, 
with you just as soon as we have it.
    Senator Shelby. Thank you very much.
    Senator Mikulski. Senator Alexander.

                           EDUCATION PROGRAM

    Senator Alexander. Thank you, Madam Chairman.
    Mr. Griffin, I want to ask you about a $153 million item in 
the budget that is labeled ``Education.'' I see that NASA's 
education themes are: one, to contribute to the development of 
science, technology, engineering, and math workforce in 
disciplines needed to achieve NASA's strategic goals; and two, 
to attract students and retain them in those disciplines. So it 
is teachers, workers, students--and students, I guess is what 
we are talking about.
    Two years ago a group of us, including the chairman of this 
subcommittee, asked the National Academy of Sciences and the 
National Academy of Engineering, of which you are a member----
    Dr. Griffin. Yes, sir.
    Senator Alexander [continuing]. To tell us what are the top 
things we need to do in priority order to keep our brainpower 
advantage in this country. They assembled a distinguished group 
and gave us 20 specific items in priority order. And items A-1 
and A-2 were the same things as your themes. In other words, 
one, is annually recruit 10,000 science and math teachers by 
awarding scholarships, et cetera; and two, is strengthening the 
skills of 250,000 existing teachers through training and 
education programs. So what I want to ask you is, in order to 
keep our jobs in this country, keep growing them, if we wanted 
quickly to recruit more math teachers and strengthen the skills 
of existing math teachers and inspire students in math and 
science, your $150 million is already at work toward that 
objective. How effective are you at that? And specifically, how 
many teachers, how many students, do you touch each year? And 
do you have any measures of how much they learn or what 
progress, how effective the programs are toward these goals? 
And have you invited your Academy of Engineering or scientists 
or other outside groups to look at this $150 million and say, 
in light of these goals, which are now being incorporated into 
legislation that has been introduced and is likely to pass here 
by big bipartisan numbers, are we getting the biggest bang for 
our buck on this $150 million in terms of new math and science 
teachers and outstanding teachers, especially with summer 
institutes and academies, which were highly recommended here as 
some of the most effective programs for training math and 
science teachers and aspiring students?
    Dr. Griffin. I do not know that we are. I have a new 
Assistant Administrator for Education. She has taken on the 
task of trying to link our spending to measurable goals and 
outcomes. When I rejoined NASA as Administrator, I too was 
unhappy with the indefinite nature of our education program. We 
are spending, as you see there, in round numbers around $150 
million or so every year on direct education, and we are 
spending another very substantial sum, in the low hundreds of 
millions, on education and public outreach as a part of our 
normal missions. So from all sources, NASA is spending 
literally hundreds of millions on education, and it would be 
nice to have it strategically oriented. I do not know that it 
is right now, but we are working on it and I would be more than 
pleased to provide an answer to you for the record on exactly 
what we are doing or a briefing to you or your staff.
    [The information follows:]
        Science, Technology, Engineering and Mathematics (STEM)
    NASA is continually looking for ways to support science, 
technology, engineering and mathematics (STEM) education to compete 
effectively for the imaginations and career ambitions of America's 
young people. NASA also provides teachers with supplemental curricular 
materials for the learning environment in communities.
    NASA has developed a number of innovative programs that use NASA's 
unique content, people and facilities to support educators in science, 
technology, engineering, and mathematics fields, and to inspire the 
next generation of explorers and innovators through the Vision for 
Space Exploration. Specific examples include:
Attracting students to the teaching profession
    The NASA Educator Astronaut project uses the visibility and 
educational opportunities created by the activities of the Educator 
Astronauts to inspire greater K-12 STEM achievement, promote STEM 
careers, and elevate public esteem for the teaching profession. In 
selecting our Educator Astronauts, we identified hundreds of our 
country's top educators. We have captured their energy through the 
Network of Educator Astronaut Teachers (NEAT). Approximately 180 NEAT 
members are now in communities all across America conducting workshops 
(three annually) reaching about 90 educators per session. These efforts 
result in strengthening STEM skills of approximately 10,000 teachers 
annually. Additionally, professional development training engaging 
educators, their schools and communities in NASA education activities 
and informing them of NASA resources has taken place in 280 NASA 
Explorer Schools (NES) 17 Science, Engineering, Mathematics, Aerospace 
Academies (SEMAA), and 31 Aerospace Education Laboratories (AEL).
Providing pre- and in-service teacher training
    NES provide intensive teacher training, the Aerospace Education 
Support Project (AESP) provides on site professional development to 
teachers in classrooms across the country. NES assist middle schools 
with improving teaching and learning in STEM education through 
significant structural (professional development, stipends, grants) and 
curricular support based on NASA resources. In 2006, 5,339 teachers 
received intensive training as part of the NES project. Additionally 
the AESP conducted sessions across the Nation, reaching 13,938 
educators.
  --Research Academy provides leading-edge research opportunities for 
        faculty and students from Minority Institutions (MI) that 
        compliment NASA's research programs and make original 
        contributions to NASA in astrobiology, biotechnology, 
        information technology, and nanotechnology. Faculty and 
        students from MI collaborate with the scientists at NASA's Ames 
        Research Center, industry, academia and nonprofit organizations 
        on research that helps prepare the next generation of explorers 
        for NASA missions.
  --In addition to in-service workshops based on our missions, NASA is 
        committed to the pre-service training of our future educators. 
        Through the National Pre-Service Teacher Conference, Pre-
        Service Teacher Institutes and Online Professional Development, 
        NASA recruits STEM teachers to develop the confidence and 
        skills to effectively teach mathematics and science using 
        cutting-edge technology and educational materials. Such efforts 
        have led to 200 STEM-enhanced teachers instructing an average 
        of 25 students per classroom times 3 years, impacting a 
        projected total of 15,000 students.
  --NASA's Digital Learning Network (DLN) fosters the effective use of 
        interactive instructional technologies through the delivery of 
        NASA educational content for the benefit of its students and 
        educators. It also contributes to the professional development 
        of internal and external educators through the delivery of 
        face-to-face and distance learning-based events. Over 74,000 
        students, teachers and other participants were engaged in a DLN 
        event last year.
Developing and distributing curricular support materials
    Curriculum Improvement Partnership Award, a three-year 
undergraduate curriculum improvement program for minority institutions 
(MI), including Historically Black Colleges and Universities, Hispanic 
Serving Institutions, Tribal Colleges and Universities, and other MI, 
emphasizes improvements that are directly related to the NASA mission 
by infusing innovative learning experiences in STEM into the 
curriculum. NASA's Educator Resource Centers (ERC) conducted educator 
Resource Center Network 362 workshops in fiscal year 2006, helping 
23,819 teachers learn about and use NASA's educational resources. 
Personnel at ERCs located throughout the United States work with 
teachers to find out what they need and to share NASA's expertise. The 
ERCs provide educators with demonstrations of educational technologies 
such as NASA educational Web sites and NASA Television. ERCs provide 
in-service and pre-service training utilizing NASA instructional 
products. Educators also have the opportunity to preview, copy and 
receive NASA instructional products.
    Through an innovative partnership, NASA is collaborating with 
OfficeMax to provide educators with a convenient way to access NASA 
materials in the most economical, productive and efficient way. If 
educators require a document or material that is large quantity (number 
of pages), and doesn't have the resources to print them, OfficeMax will 
print materials and make them available at any of their nearly 1,000 
stores across the country, including Puerto Rico and the Virgin 
Islands.
Supporting informal learning
    The Museum Alliance provides near real-time access to NASA 
information from missions such as Cassini, Hubble and Mars, as well as 
Earth science resources, for use in museums and science centers across 
the country.
    In collaboration with the American Museum of Natural History, 
dozens of activities and curricular support materials and lessons were 
adapted for use by the after school community.
    Other examples of the unique innovative projects that NASA makes 
available to support students across our Nation and to inspire more 
students to pursue higher levels of study in STEM courses include:
  --The Science Engineering Mathematics and Aerospace Academy Program 
        (SEMAA) reaches K-12 minority students that are traditionally 
        underrepresented in careers involving STEM. Students meet 
        during school, after school or on Saturday mornings and during 
        the summer to engage in hands-on, interactive learning sessions 
        that are specifically designed for each grade level.
      Between the International Space Station, the space shuttle, 
        sounding rockets and high altitude balloons, NASA's Education 
        Flight Projects provide hands-on experiences to inspire and 
        motivate students to pursue studies and careers in STEM through 
        participation in NASA research applications. NASA is using its 
        unique assets like the C-9 to allow students to study 
        microgravity; we are launching student experiments more than 25 
        miles above the Earth on sounding rockets; and our astronauts 
        make phone calls from 240 miles above Earth's atmosphere to 
        students to involve them in current research aboard the 
        International Space Station. All these opportunities take 
        advantage of our flight hardware projects provide real, hands-
        on experiences to inspire the minds, imaginations, and career 
        ambitions of America's young people.
  --Teacher training for Worlds Beyond Our Own captures the excitement 
        and discovery surrounding planetary exploration. NASA and the 
        Johns Hopkins Applied Physics Laboratory developed workshops 
        and materials to assist educators in capturing the excitement 
        surrounding NASA's New Horizons mission to Pluto that launched 
        in January 2006. New Horizons is the fastest spacecraft ever 
        launched from Earth, on board one of America's most powerful 
        rockets, and will be traveling the farthest distance of any 
        NASA spacecraft to begin its primary mission. Students will 
        grow up with this project. Today's elementary school students 
        will be in college when this spacecraft encounters Pluto.
  --Museums and Science Centers are developing activities and materials 
        to inspire, educate, and engage students, educators and the 
        general public. They are also hosting professional development 
        opportunities for formal and informal education professionals 
        across the Nation. For example, in 2005 NASA and the Children's 
        Museum of History, Natural History, Science and Technology in 
        Utica, NY unveiled two new exhibits at the museum. The exhibits 
        ``Why We Explore'' and ``Space Station Imagination'' provided 
        an overview of the history and future of space exploration. 
        Astronaut Ed Lu, a veteran Space Station astronaut, who spent 
        six months aboard the International Space Station, hosted the 
        unveiling.
  --NASA's Great Moonbuggy Competition allows high school and college 
        students' to race into the future and cross the surface of the 
        moon without leaving the Earth. Teams from the United States 
        and Puerto Rico design human-powered vehicles to compete in 
        NASA's annual Great Moonbuggy Race. The race was inspired by 
        the lunar rover vehicles astronauts drove on the moon during 
        three Apollo missions. This year's event, opened to the media 
        and public, was held April 13-14 at the U.S. Space & Rocket 
        Center in Huntsville, Alabama.
    In fiscal year 2005, through a variety of venues (distance 
learning, videoconferencing, events, competitions, face-to-face, Space 
Shuttle and ISS downlinks, workshops, and other activities NASA has 
reached more than 2.9 million students, (776,000 K-12; 50,000 higher 
education; 2,151,380 distance learning students) and 855,000 teachers. 
(Please note: the number of teachers represents not a number of the 
individuals that participated but a number of participation 
opportunities that were taken, many of which were taken multiple times 
by the same individuals.)
    Educators who participated in NASA workshops and events provided 
feedback via the NASA Education Evaluation Information System (NEEIS) 
regarding the effectiveness and relevance of our efforts. With a 5.0 
Liken scale in which ``5'' is the highest value, the average of the 
teacher participant ratings of NASA's workshops and resources was 4.67.
    NASA's resources (teacher training programs, supplemental 
curricular materials, etc.) are aligned to national standards and 
complement other agencies efforts. Interagency forums, e.g. the 
National Science and Technology Council enable all STEM education 
focused agencies and departments to share information and best 
practices to promote complementary activities.
    Additionally, NASA uses objective and verifiable performance 
metrics, regular management insight and review processes, and defined 
tools to assess its performance at all levels--portfolio, outcome, and 
the individual program/project/product/activity.
    The Agency is working with other agencies, e.g., National Science 
Foundation to examine their evaluation techniques to determine 
applicability and best practices for assessing NASA's education 
portfolio, strategic outcomes, and projects.
    In fiscal year 2006, the National Research Council (NRC) Board on 
Science Education began work under a contract with NASA to conduct an 
evaluation of NASA's precollege education program. An expert panel was 
convened and the first committee meeting was held Nov. 15-17, 2006. A 
second meeting held on January 18-19, 2007. Three additional committee 
meetings will be held prior to the submission of the NRC's report, 
scheduled for November 2007. The NRC does not release preliminary 
results prior to submission of their report.
    In addition to the NRC evaluation, other independent assessments, 
evaluations and program reviews of projects such as NES, AESP, 
EarthKam, and SEMAA are conducted annually by Paragon Tec Inc. (NES), 
Western Michigan University (AESP), Education Development Center for 
Child and Technology (EarthKam), and Benson Penick and Associates 
(SEMAA).

    Senator Alexander. Well, no, I would be--you can provide it 
to me, because I am very interested in it and would like to 
work with you. My son went to the space camp in Huntsville and 
that's an attractive way to inspire students. But if I may 
suggest, one outside group that may be useful to your assistant 
and to you as you measure the $150 million might be the 
Augustine Group in the National Academies, because they spent a 
summer looking over a great many programs, looking at their 
effectiveness. That would be one source of input.
    For example, the legislation that we have would increase 
the number of summer institutes at national labs. Well, I can 
think of no more inspiring place for math and science teachers 
in Tennessee to go for a 2-week session than an academy in 
Huntsville, to learn new techniques for teaching math and 
science and to inspire them to do a better job.
    You have so many degrees that you have enough degrees for 
the whole room here, so I know I am preaching to the choir. But 
just as an example, we are talking about very measurable 
numbers here. Governor Hunt of North Carolina, former Governor, 
told us that the University of North Carolina College of 
Education graduated three physics teachers last year for the 
entire State of North Carolina. I am sure the number in 
Tennessee is not much more. But just in our own region with 
that one activity in Huntsville, we could probably quadruple or 
double or even by a factor of more the number of teachers 
through summer institutes, academies, a variety of ways.
    So I would look forward to working with you on that and 
following it over time, and I am delighted that you are there 
and that it is a priority of yours.
    Dr. Griffin. I would be interested in working with you on 
it and I am certain that if legislation is passed increasing 
the number of summer academies and institutes that we would be 
happy to be part of that. We would be thrilled.

                     MATH AND SCIENCE INSTITUTIONS

    Senator Alexander. Madam Chairman, and I am also suggesting 
that since they have recommended this as the single most 
important thing we could do to keep our competitive edge, ahead 
of research, ahead of the R&D tax credit, ahead of everything 
else, we might take some of that $150 million you have now got 
and have some summer institutes for math and science teachers 
and students.
    Dr. Griffin. Well, much of the money that we are spending 
today is set aside for member preferences on how the education 
dollars are to be spent, and if it could be spent more 
strategically I would be, for one, I would be much in support 
of that.
    Senator Mikulski. Dr. Griffin, now you know why Senator 
Shelby and I were so excited that Senator Alexander joined the 
subcommittee. We worked with he and Senator Domenici and 
Senator Bingaman last year to literally put into a legislative 
framework the rising above the gathering storm, and he came on 
this particular subcommittee because of his passion really to 
implement the triad of increased research, increased 
opportunities in education to get people excited about science, 
and number three, a more innovation-friendly government.
    Who is your new assistant for education?
    Dr. Griffin. Her name escapes me right now.
    Senator Mikulski. Mary, do you want to?
    Dr. Griffin. Oh, thanks. Dr. Joyce Winterton. I am sorry. 
She just recently came on board and I met her only once.
    Senator Mikulski. No, I know you've got a lot on your mind. 
This is like sitting for your oral exams for your doctorate. We 
go from one topic--no, we understand.
    Dr. Griffin. No, that was easy. This is much tougher.
    Senator Mikulski. What we would like to suggest is that the 
new Administrator meet with Senator Alexander, because you are 
right, in previous years education has been gushy and where 
there is a vacuum members step in. So now I think we would like 
to make wise and prudent use of that $150 million and we can 
see the benefits. Certainly the NASA relationship with the 
Maryland Science Center has been a cornucopia of running 
opportunities both for teachers and for students.
    But we would like to really make good use of this because, 
again, NASA is where it is at. It is--what I said to the 
President about being in the innovation-competition agenda, 
competitiveness agenda. It is NASA through its technology, 
through Hubble, to its space exploration program, that really 
excites people about science. And we have got all these young 
little geniuses out there who want to participate in October 
Sky, while we, of course, do our appropriations.

                        SPACE SHUTTLE RETIREMENT

    So moving on, though, to like some nuts and bolts again, 
Shuttle retirement. What I am concerned about is what happens 
if the Space Station is not finished by 2010 and you are ready 
to retire the Shuttle? Do we anticipate that the Shuttle really 
will be done by--excuse me, the Space Station, that the Space 
Station will be done by 2010? And do you really believe that it 
will, but do you have a contingency plan? What is the 
consequences of the contingency plan?
    Dr. Griffin. We have dealt with that in a couple of ways. 
First of all, I do believe that the assembly schedule 
accommodates ample margin to finish the assembly of the Space 
Station with the Space Shuttle by 2010. It was planned that 
way. When I came back to NASA, we did not have a plan that 
accommodated a reasonable schedule reserve to finish the Space 
Station by 2010, nor did we have the budget for it. So we 
tightened our belt on the human space flight side of the house 
and we deferred, as many have regretted and as I regret, we 
deferred some of the utilization of the Space Station in the 
next few years in order to focus on assembling it.
    So our average flight rate over the years, including time 
out for two losses due to accidents, has been 4\1/2\ flights 
per year. We are on that pace now again. We are doing well, and 
if we continue that pace we will finish with ample margin. So I 
do believe we can do that.
    Now, the consequences----
    Senator Mikulski. Do you envision any scenario that would 
keep the Shuttle going after 2010?
    Dr. Griffin. I do not. In fact, at some point years ahead 
of your last flight you have to buy your last tank, your last 
solid rocket boosters. We've done that. So we do not envision a 
scenario in which we would continue to fly past 2010. Now, the 
last couple of flights have been arranged so that they are the 
least crucial flights, and so if it were necessary to drop a 
flight or two we would still have the assembly complete. Some 
of our logistics would not be delivered and we would have to 
find some other means of commercial transport to put those up. 
In fact, that is what we plan to rely on between 2010 and when 
the crew exploration vehicle (CEV) comes along, is commercial 
transportation to the Space Station to deliver our supplies and 
other cargo.

             ORION CREW RETURN VEHICLE/ARES LAUNCH VEHICLE

    Senator Mikulski. We could have a robust conversation just 
on that. But I would like to give you the opportunity, because 
I know Senator Shelby as our other colleagues are very keenly 
interested in, of course, the Orion crew return vehicle and the 
Ares launch vehicle. That is the bread and butter. I mean, that 
is the--without that, space exploration will really just 
sputter.
    The Orion of course, the safety of our astronauts, the crew 
return vehicle, and of course the launch vehicle. In your fall 
testimony, which was the part that I was reading, you talk 
about how, based on everything I know, due to the cumulative 
effect of reductions in the exploration system to pay for the 
Space Shuttle return, previously underestimated costs to fly 
the Shuttle until 2010, and the reduction in fiscal year 2007, 
you were concerned about, number one, the schedule that you now 
had, and number two, you also comment that you are not sure 
about what will be the workforce implications of all of this.
    What I would like to do today with Senator Shelby and I 
here, do you want to elaborate on that, so we just kind of get 
it all out into the air? Right now we have just identified 
Hubble costs $40 million. That is a chunk of money. Let us 
really talk about what it is going to take and what you would 
like to see in order that we meet--we understand, we do want 
Orion. We do want Ares, and we want it in as well-paced a way 
as you would, and I think the mission calls for.
    So do you want to elaborate on your testimony, because I 
think this is the nuts and bolts of what colleagues are asking 
and what we are asking. So tell us how you see this and for you 
to elaborate on your testimony, and particularly also the work 
force implications, because some of our colleagues are 
apprehensive.
    Dr. Griffin. Yes, Madam Chairman. Would you like me to sort 
of walk you through how we got where we got?
    Senator Mikulski. No, we know how we got where we are.
    Dr. Griffin. You know how we got there, okay. So you want 
to know what we need to go forward.
    Senator Mikulski. Yes. We know how--it is kind of that 
same, we are where we are. So we know where we got, but we have 
got to get going. So let us talk about the got to get going.
    Dr. Griffin. Yes, Madam Chairman. I just wanted to make 
sure I understood what you wanted me to talk about. Accepting 
the intent of the Congress on the fiscal year 2007 continuing 
resolution, Senator Nelson and Senator Hutchison asked me what 
it would take to get back into 2014 with the CEV and the Ares 
and Orion. I said, after we studied it carefully, to replace 
the money that was not appropriated in 2007 would require $350 
million in fiscal year 2009 and $400 million in fiscal year 
2010, as close as we can estimate it. That would get us back to 
September 2014. I was also asked what it would take to get back 
into 2013 and, considering that again as carefully as we can, 
we believe that it is about $100 million a month. So that 
should just be the way that you should think about it. Every 
month that you want to pull the schedule in is $100 million.
    The best we could do at this point would be to bring it 
back to June 2013. So June 2013 is where we are on a technical 
schedule.
    Senator Mikulski. Technical. But as it stands now, based on 
the 2014, knowing earlier is always nice to hear, but we would 
be concerned about two things. Number one, what now as we look 
at 2008 in order to meet responsibilities, meet our 
responsibilities in 2008, and also what you need to do in terms 
of the fiscal mechanisms, not to be sure that we do not get 
into the overrun problem.
    Dr. Griffin. Of course, now----
    Senator Mikulski. What do you need in 2008 to, say, meet a 
2014?
    Dr. Griffin. I do not need anything additional in 2008.
    Senator Mikulski. But for us to stay the course?
    Dr. Griffin. For us to stay the course. If you wished to 
pull the schedule in and stay the course and be in 2014, we 
would need money in 2009 and 2010. Of course, you know better 
than anyone that fiscal year 2009 preparation starts next 
month. So fiscal year 2009 is already upon us. But I do not 
need additional funds in fiscal year 2008. But I would need to 
know that funding would be coming along in fiscal years 2009 
and 2010.
    Senator Mikulski. But your point, though, is that in 2008, 
that if there is any shrinkage in 2008--and, of course, we are 
looking forward to what our allocation is going to be. This is 
why we are looking--you know, we are so glad the budget is 
going to be on the floor, that we know what our allocation is, 
because we presume that some time in May we will need 
additional conversations. We will know what our allocation is, 
we will know the direction.
    But to be clear, if we stay the course in 2008 as 
recommended here, you will be moving while you are looking at 
2009. And that is also if something unforeseen does not happen.
    Dr. Griffin. That is exactly correct, Senator. If I get the 
President's budget in 2008 and if the funding I mentioned in 
2009 and 2010 were to be supplied, if you chose to do that, 
then we would be back on track. I will say for the record, our 
technical planning on these systems is very conservative. We 
are budgeting with new levels of conservatism. I have spoken of 
65 percent confidence level budgeting. Paul has heard me and 
Art has heard me on this. So I strongly believe, that we can 
avoid future technical surprises in this. We are not developing 
new technology here. We are striving to restore lost 
capability. So this is not the time to develop new technology.

               INDEPENDENT PROGRAM ANALYSIS ORGANIZATION

    Senator Mikulski. Well, first of all, I know that many are 
talking about even if we could accelerate it another year. I 
want to be sure that there are mechanisms in place to make sure 
that Orion and Ares are properly managed. And I know you share 
that.
    Do you have an independent oversight mechanism to verify 
cost, design, and technical feasibility?
    Dr. Griffin. Yes, we do. We have an entire independent 
program analysis organization that, in fact, does just such 
cost analyses, that is independent of the programs.
    Senator Mikulski. I am sorry; who does that?
    Dr. Griffin. Again, it is our independent program analysis 
organization.
    Senator Mikulski. So you have an internal red team?
    Dr. Griffin. Yes, Madam Chair.
    Senator Mikulski. Is that kind of that in a nutshell?
    Dr. Griffin. We do. They are located at Langley or they are 
headquartered at Langley. They are independent of the programs 
and their estimates in fact have been quite reliable. It was 
they who brought to me the correct information regarding the 
underfunding of the James Webb Space Telescope a couple of 
years ago. So I have found them to be very good.
    Senator Mikulski. We just needed to know what it was.
    I just--I do not know if Senator Shelby has more questions, 
but when Shelby--when Senator Shelby moved the bill last year, 
I think, Senator, you had $3.7 billion in there for this, which 
of course is very close to the President's budget. Had we been 
able to move our bill, I think we would be in good shape.
    I know with the continuing resolution--and it has given 
heartburn to many of us, even the idea that we had to do one--
there was $400 million, so it was not a total loss. But it was 
enough of a loss for you to lose time, but you do not want to 
lose ground; is this right? And if we get back to where we are, 
I think we will have a way forward.
    Dr. Griffin. That is correct, Madam Chairman. I would again 
emphasize we will soon be making decisions with our contractor 
based on what money we can expect when. So if it is your 
intention----
    Senator Mikulski. You know, when you talk about 2009 and 
2010, I do not dispute this. I am glad to hear. Also there is 
the red teaming, which means--but we are not the only ones that 
need to hear this. And I know you are starting next month. This 
is why I would like for us to be in the room and say, we have 
got to talk about a couple of years here, how we can retire the 
Shuttle with honor and say goodbye, not be sitting on the 
launch pad for a prolonged period of time, but do it in a well-
paced way, as well as to meet important scientific objectives 
that have been identified by both your team and the national 
academies.

                  AMERICAN COMPETITIVENESS INITIATIVE

    Senator Shelby. Thank you. Madam Chairman, I think we do 
need some type of summit with Dr. Griffin and others where we 
can just talk about what we really need, where you really want 
to go, and so forth, and see how we can help.
    Dr. Griffin, ACI. I was surprised to see that NASA was not 
included as part of the American competitiveness initiative, 
ACI. The goals for the education component of NASA's budget are 
to strengthen the Nation's future workforce, attract and retain 
students in science and engineering, and to engage Americans in 
NASA's mission. Coupled with the high public visibility and 
recognition that you enjoy, it seems that NASA would be a 
natural fit for such an initiative.
    It is troubling why NASA was not included in this 
initiative. It seems like it is a pretty good fit.
    Dr. Griffin. Well, yes, sir. In fact, much of what we do 
fits very naturally within the goals of the ACI. There may be 
some semantics involved here, but I think in a way that is a 
reason why NASA was not specifically included. We are already 
doing many of those things.
    The ACI was also intended to provide additional budget for 
agencies which had not been receiving it, and from the 
administration's point of view NASA is already above the 
average level for domestic non-defense discretionary agencies.
    Senator Shelby. You have got a lot of brainpower, I think, 
that we could use.
    Dr. Griffin. Well, I hope we do.
    Senator Mikulski. I would agree.
    Dr. Griffin. Well, we support your view that we at NASA do 
many things that are closely related to the goals of the ACI 
and we intend to keep doing those things.

                           CHINESE ASAT TEST

    Senator Shelby. China. I know that last summer you were in 
China to talk about their space program and so forth.
    Dr. Griffin. Yes, sir.
    Senator Shelby. As we are all aware, China recently 
conducted a test that destroyed a weather satellite in an orbit 
about 500 miles above the Earth. This test had to have created 
some space debris that eventually will fall or could fall to 
the Earth. But it would first have to pass through space 
occupied by the International Space Station and other valuable 
NASA assets. That is what I have been told.
    I do not want you to touch on any classified information 
here, but what risk to NASA's assets was created by this test 
and could you relate that here, or would you rather defer that?
    Dr. Griffin. No, I can discuss that here, Senator. For the 
first few weeks after the Chinese ASAT test, the risk to the 
Space Station approximately doubled. Now, I would state 
correctly for the record that the average daily risk to the 
Space Shuttle from orbital debris is about 1 in 100,000. So the 
risk doubled from about 1 in 100,000 to 1 in 50,000.
    After a few weeks, the debris had spread out and retreated 
into what the analysts refer to as the background. So after a 
few weeks that debris posed no measurable additional risk over 
the existing background that was already there. Nonetheless, of 
course, we deplore such tests because we now understand in a 
way that we did not some decades ago how dangerous that debris 
can be, and in fact China is part of international coordinating 
bodies whose goal is to mitigate such debris. So we do regret 
that test, but at this point it does not pose an additional 
threat to any space assets that we have.

                  STATUS OF THE EXPLORATION ACTIVITIES

    Senator Shelby. Dr. Griffin, for the record, could you give 
us a status of the exploration activities such as the 
Constellation program are progressing, would you specifically 
focus on crew exploration vehicle, the crew launch vehicle, and 
the launch operation aspects of the program? Could you do that?
    Dr. Griffin. Yes, Senator. The crew exploration vehicle--
when I sat here with you a year ago we were in the middle of 
source selection. We said that we would select a winning 
contractor by Labor Day of that year, and we did. That winning 
contractor is Lockheed. We have spent the last few months 
working with them to scrub the design and definitize the 
requirements. That has gone quite well. They are on track and 
they are on target.
    We with Senator Mikulski already discussed the impact of 
various delays, including the need to find additional money for 
the Space Shuttle last year and the continuing resolution this 
year. The accumulated effect of delays is to put us into 2015, 
which none of us want to be in, and both of you have expressed 
your desire to help with that and I appreciate it.
    But the technical work on the CEV is on target. The Ares 
launch vehicle, which, as I think you know, is being developed 
under the leadership of a team at the Marshall Space Flight 
Center, is equally on target. They are doing just a great job. 
They have released the RFP, the request for proposals. Industry 
is now bidding on the upper stage development work for that 
vehicle. The first stage uses an existing development, the 
Shuttle solid rocket booster, which the project office for that 
exists at Marshall Space Flight Center. So we will be combining 
a second stage with an old first stage, and that will be the 
new crew vehicle.
    The instrument unit for that will be procured in an RFP 
this October. So by the time the new fiscal year starts, we 
will have all the elements of Shuttle replacement under 
contract and in work. I am very pleased. We have teams at 
Marshall Space Flight Center and Johnson Space Center on that. 
I am very pleased.
    Launch pad work has already started on Complex 39B to 
transition that from a Shuttle pad to a new Orion and Ares pad. 
Now, Senator Mikulski, as you and I have discussed, we will 
preserve the launch on need capability during the Hubble Space 
Telescope servicing mission. So we will not make modifications 
to Complex 39B which would interfere with the Shuttle launch, 
but we have started those modifications in non-interfering 
ways.
    The team is excited. They are energized. This is affecting 
our educational posture because I spent 13 years as an adjunct 
professor. If I ever again have a life to call my own, I will 
go back to doing it. But my academic friends are telling me 
that their college students are excited and they are energized 
because they see a space program being reborn out there that 
they can join when they graduate from college, and they look 
ahead and they say, well, when I am 45 we will be going to 
Mars, and that is true. If we keep going with what we are 
doing, that is true. So work is going very well.
    Senator Shelby. Dr. Griffin, I do not believe you will be 
an adjunct professor unless you want to by choice. You will be 
a chaired professor somewhere.
    Madam Chairman, thank you.

          NATIONAL ACADEMY OF SCIENCES REPORT ON EARTH SCIENCE

    Senator Mikulski. Thank you, Mister--thank you, Senator 
Shelby.
    I just have one last question before we go. I know there 
are votes. I want those college kids when they are 45 knowing 
that we are on Mars, but I do not want them sitting at a kayak 
at Goddard because the bay has risen that far because of global 
warming.
    Which takes us to the National Academy of Sciences report 
on Earth science. Dr. Griffin, as you know, they have 
recommended a robust agenda of 17 different projects to study 
climate and atmospheric and oceans issues along with NOAA, to 
really also focus on those things that would have societal 
benefit.
    Do you want to tell us your reaction to this and how you 
would see--I know it is not in 2008, but how you would see 
incorporating this? And also, one of the things it calls for is 
a memorandum of agreement with NOAA to really maximize and 
leverage the respective work that both agencies are doing. Do 
you want to comment on that?
    Dr. Griffin. Yes, Madam Chairman, I would like to. I think 
the NASA-NOAA relationship is as good or better than it has 
ever been. Admiral Lautenbacher and I and our staffs talk 
frequently. We, as I said in an answer to one of your earlier 
questions, we recognize the need to replan our Earth science 
and observation and climatology work together, given the 
restructuring of NPOESS, and we will be doing that over this 
summer and we will be keeping you and your staffs informed as 
to how that is going.
    We have a National Research Council study which is due to 
us to help with this issue, as well as a study that we are 
preparing for OSTP. We will factor in the results of the new 
decadal, which I would remind you, we asked for that decadal. 
So we now have their priorities for the work which should be 
done within Earth science, and in fact we used the midterm 
report on that to increase money to the global precipitation 
measurement mission, the GPM, which we will be doing in 
conjunction with the Japanese. So we are paying attention.
    Senator Mikulski. I want to be very clear that the 
recommendations of the National Academy on Earth science for 
the climate crisis does not mean in any way to imply that you, 
meaning NASA and the Earth sciences have not already been 
looking at it.
    Dr. Griffin. Right.
    Senator Mikulski. This is the look ahead. That is why they 
call it the decadal. That is like we are in the decathlon.
    Dr. Griffin. So we will be restructuring our Earth science 
portfolio, or we will be making certain that our Earth sciences 
portfolio over the budget planning horizon starting with the 
fiscal year 2009 budget does reflect the input of the decadal, 
and we will share that with you.
    Senator Mikulski. Well, I am really excited to hear about 
that and, as both Senator Shelby and I have said, we have got a 
long road ahead. I think we are very clear that in 2008--
ordinarily phrases like ``stay the course'' do not usually mean 
something, but we understand how--what we need to be doing in 
2008. But we also want to look ahead to the longer issue, the 
NASA trend lines, as well as ensuring that we do have a 
reliable space transportation system as promptly as the Nation 
can afford to do it, as well as keeping other important 
projects.
    I think we have really gone through quite a bit of our 
questions. Senator Shelby, do you have a last one?

                 RANKING MEMBER SHELBY CLOSING REMARKS

    Senator Shelby. I just have one brief comment since we have 
Dr. Griffin here again.
    Dr. Griffin, we want to work with you, both of us. I work 
now as the ranking Republican, former chairman. Senator 
Mikulski was the former ranking Democrat, now chairman. But I 
do not believe that NASA has two bigger supporters than the two 
of us here on this subcommittee. We are going to continue to 
work with you to make NASA what it wants to be.
    Dr. Griffin. Thank you, Senator. I know that you have been 
my biggest supporters and I very much appreciate it.

                          SUBCOMMITTEE RECESS

    Senator Mikulski. This subcommittee is recessed. We will 
return on April 12, when we will take testimony from the 
Attorney General.
    [Whereupon, at 3:18 p.m., Thursday, March 15, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]























  COMMERCE, JUSTICE, SCIENCE, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2008

                              ----------                              


                        THURSDAY, APRIL 19, 2007

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Barbara A. Mikulski (chairman) 
presiding.
    Present: Senators Mikulski, Lautenberg, Shelby, Stevens, 
and Domenici.

                         DEPARTMENT OF JUSTICE

          Bureau of Alcohol, Tobacco, Firearms and Explosives

STATEMENT OF MICHAEL J. SULLIVAN, ACTING DIRECTOR

                STATEMENT OF SENATOR BARBARA A. MIKULSKI

    Senator Mikulski. Good morning. The Subcommittee on 
Commerce, Justice, Science, and Related Agencies will come to 
order. Today we will be taking the testimony of the Bureau of 
Alcohol, Tobacco, Firearms, and Explosives (ATF), the Drug 
Enforcement Administration (DEA) and the United States Marshals 
Service.
    We want to extend a warm welcome to our witnesses today and 
let our witnesses know how important we think their job and 
their mission is to this country.
    When we planned this hearing a few months ago, it was to 
examine the budget of these very dedicated law enforcement 
agencies and to discuss how the Commerce, Justice, Science 
Subcommittee could work with them to make sure they had the 
tools they needed to protect our national security and keep our 
communities safe.
    Yet, this week, a very grim and very melancholy event 
occurred on the campus of one of our universities. On Monday we 
watched in shock and horror as Virginia Tech came under fire 
with over 32 dead and many more injured. The terrible tragedy 
highlights how important it is for our Federal law enforcement 
agencies to be able to work together with our local law 
enforcement at a time of great tragedy.
    What we know is that ATF was immediately on the scene 
sending 12 ATF experts to Virginia to secure the crime scene, 
and make sure that the integrity of the evidence at the crime 
scene was not compromised. In fact, Maryland is home to a very 
unique ATF forensic lab. I know the subcommittee will be 
interested to hear about this facility because it is where ATF 
identified the ballistics evidence to determine if there was a 
single killer or multiple killers. But at the same time we know 
that DEA and the Marshals Service also answered the call.
    In the briefing that you've provided me before this hearing 
it was clear there was an outstanding effort by Federal 
agencies in supporting and augmenting the local community so 
they knew they were not alone. While they were making the best 
of a terrible situation, you were doing your best, which was 
making sure needs were met. We will be asking you today 
questions along these lines.
    We also want to then focus on each of your very unique 
missions. We know that the DEA is an integral part of fighting 
the global war against terrorism. Terrorism, whether it's been 
growing poppies in Afghanistan to fund the Taliban or to what 
is happening in our own community with the cyber distribution 
of highly addictive substances or to working with State and 
local law enforcement to shut down and clean up toxic meth 
labs. We want to know more about what you're doing and what we 
can do to help you do it.
    Also for our Marshals Service, the Marshals Service plays a 
unique role. Right this minute on the Senate floor we're 
debating court security. We ask the Marshals Service to provide 
court protection to both witnesses and to our judges. We also 
ask them to guard fugitives. We also ask them to provide unique 
and special protection in high profile trials where there is a 
drug kingpin or a terrorist. At the same time we want them to 
enforce the Adam Walsh Act and make sure they apprehend the 
sexual predators who refuse to register while making sure you 
catch them before they commit another repugnant act.
    So we want to listen to all of you today. Our ATF, whose 
unique job is to enforce laws related to alcohol, tobacco, and 
firearms. This is not the old days of breaking up stills. There 
is nothing still about ATF in terms of its modern mission. 
They're on the scene investigating arsons, illegal trafficking 
of guns both internationally and nationally while providing 
unique forensic capability that often local communities cannot 
afford particularly those in rural America.
    Threats have changed since your agencies were created. 
Technology is in demand and at the same time the very people 
that work in these agencies need to have even better and unique 
training. So the job today is to listen to what you are doing 
and to tell us what resources you need to be able to do it 
better, to make sure that we're protecting our national 
security and our community security.
    With that I would like to then yield to my ranking member, 
Senator Shelby.

                 STATEMENT OF SENATOR RICHARD C. SHELBY

    Senator Shelby. Thank you, Chairman Mikulski. I want to 
thank all of the participants for joining us to discuss the 
2008 budget for the Bureau of Alcohol, Tobacco, Firearms and 
Explosives, the Drug Enforcement Administration, and U.S. 
Marshals Service.
    The total Department of Justice request for 2008 is a 
little over $20 billion. This is a $771 million decrease below 
the 2007 joint resolution funding level. The Department faces a 
$500 million shortfall in the 2008 budget. Just as I said last 
year, the budget constraints placed upon us by the war on 
terror and the recent hurricane seasons will once again force 
us to make tough decisions.
    I would be remiss though if I didn't, as Senator Mikulski 
has already done, mention the tragedy that took place on the 
Virginia Tech campus Monday morning. My heartfelt thoughts go 
out to everyone that was affected by this horrible event.
    The ATF has been one of the lead investigative agencies in 
this horrible disaster and it has done an outstanding job. ATF 
agents quickly identified ballistic evidence linking a weapon 
used in the first shooting to the second shooting. Acting 
Director Sullivan, I commend your personnel in the labs and on 
the ground for their quick and professional response. This 
somber day will be one mourned and remembered by all of us for 
years and years to come.
    I also once again want to commend the ATF for its 
contributions to the quick capture and conviction of the 
Alabama church fire arsonist that was sentenced to prison last 
week, remember that horrible situation there, where they were 
burning churches.
    The ATF's 2008 request is a little over $1 billion. The 
request is $29.8 million over the 2007 joint resolution total 
and you'll need it. The ATF as we all know is the premier 
agency for gun crimes, gang activity, arson, and explosive 
related crimes. I'm committed, as the chairman is, to ensure 
that you have the tools and training facilities to fulfill your 
explosives mission.
    The National Center for Explosives Research will be a 
world-class addition to the Redstone Arsenal in Huntsville, 
Alabama, which is already home of the Federal Bureau of 
Investigation's (FBI) hazardous devices school.
    I'm working collaboratively here to expand the Federal 
Government's explosive infrastructure and expertise there. This 
will assist in our number one priority of terrorism prevention 
and ensuring a safe homeland.
    Redstone Arsenal should and will be the law enforcement 
capital of explosives research and training. We have the 
personnel. You have them there.
    Director Sullivan, I would like to offer you 
congratulations again on your nomination to be the permanent 
Director of ATF. We believe you will sail through. We all want 
to help you. You bring a lot of experience as a former U.S. 
attorney in Massachusetts and I believe that you will serve the 
ATF and the Nation well in this regard.
    Administrator Tandy, thank you for coming today. The Drug 
Enforcement Administration's budget request for 2008 is $1.8 
billion, a little over a $57 million increase over the 2007 
joint resolution total.
    The role of the DEA has shifted from being solely focused 
on narcotics to include an intelligence mission and a position 
on the front line on the war on terror. As former chairman on 
the Select Committee on Intelligence, I know all too well the 
link between global drug trafficking and terrorism.
    I understand the detrimental impact that a hiring freeze 
has on your ability to carry out your mission. Senator Mikulski 
and I will be working with you on the 2008 process to see that 
you, the DEA, have the manpower that you need to carry out your 
mission. I think it's critical.
    By the same token, while we're addressing the budget 
shortfalls and hiring freeze, I received this disturbing letter 
from the Department of Justice on March 6, stating that the 
cost of the clandestine laboratory training facility has 
doubled from $8 million to $16 million.
    This letter combined with the disastrous cost escalations, 
poor estimations, and project management of the DEA's 
information technology center that jumped from $7.1 million to 
$38 million show a disturbing and, I think, unacceptable trend 
that we'll have to put our hands on in this subcommittee.
    I will reserve any further judgment because we don't know 
all the facts until we hear from the recommendations of the 
inspector general and the Government Accountability Office 
(GAO).
    Meth, as the chairman has mentioned, use continues to 
poison our Nation, knowing no boundaries of age, gender, class 
or race. The majority of this drug is shipped into our country 
from Mexico and I want to commend the DEA and the Department of 
Justice in their recent success of Operation Imperial Emperor, 
where more than 400 individuals were arrested and $45 million 
in U.S. currency and 18 tons of illegal drugs were seized from 
a Mexican drug cartel. That's progress.
    Violent Mexican drug cartels have turned our Southwest 
border into a battle zone where our DEA agents put their lives 
on the line everyday. These cartels have their own advanced 
telecommunications towers and encrypted radios making their 
communications system virtually impenetrable with our current 
surveillance quota.
    I hope, Senator Mikulski, that we will be able to help fund 
with the modern technology that the DEA needs here to have the 
right technology in the hands of our agents so that they can 
fight this battle.
    Director Clark, the U.S. Marshals Service budget request is 
$899.8 million. This is an $80 million increase over the 2007 
joint resolution total. The core responsibilities of the 
Marshals Service include providing judicial and courthouse 
security, safeguarding witnesses, transporting prisoners for 
court proceedings, seizing forfeited property and apprehending 
fugitives. That's a lot.
    The National Center for Missing and Exploited Children 
estimates that over 600,000 sex offenders in the United States, 
more than 100,000 of them have failed to register. With the 
enactment of the Adam Walsh Act, marshals are tasked with 
removing those unregistered offenders from our streets which is 
a daunting task.
    Last year the U.S. Customs and Border Protection Agency 
received funding to hire an additional 2,000 border patrol 
agents. Marshals bare the primary burden of transporting 
illegal alien prisoners taken into custody by these border 
patrol agents meaning there will be fewer marshals removing 
unregistered sexual offenders from our neighborhoods and 
streets. This is a problem, I think, Madam Chairman, we've got 
to address.
    The Presidential Threat Protection Act of 2000 authorized 
the permanent creation of fugitive apprehension task forces 
which are comprised of Federal, State, and local law 
enforcement authorities in designated regions. Through this 
act, the gulf coast regional fugitive task force, headquartered 
in Birmingham, Alabama, was created last May.
    At approximately 8 a.m., a young female lawyer was 
kidnapped at gunpoint in the parking lot just a few blocks from 
my office in downtown Birmingham. Some of you might remember 
seeing video of this as it was captured on a security camera 
and shown on network news channels all over the Nation.
    Through the efforts of the gulf coast regional fugitive 
task force, the kidnapper was captured and the woman returned 
to her family without serious bodily harm. That is good, good 
work. This is just one example of what you're doing and how 
you're doing it.
    Last, the reprehensible working conditions and inadequate 
security resources that our marshals endure in the District of 
Columbia Superior Court building have recently been brought to 
my attention. Stale ventilation, flooding hallways, poor 
plumbing, malfunctioning lights that are needed to illuminate 
prisoner traffic areas monitored by security cameras and 
archaic prisoner tracking system and antiquated prisoner 
scanning devices are conditions that are not acceptable, that 
you need better funds for better equipment.
    Director Clark, I understand you visited this facility last 
week and I look forward to hearing from your visit and what we 
can do, this subcommittee, to resolve this very, very serious 
matter and I want to thank you for the job you do and I want to 
thank the men and women who work at the Department of Justice 
for what they do everyday. Thank you.
    Senator Mikulski. Thank you very much, Senator Shelby. The 
way the subcommittee is going to proceed is we're now going to 
turn to our witnesses and then for those who colleagues who 
also had opening statements, you can incorporate that in your 
question and we'll add some additional moment or two so there 
would be no penalty.
    Our colleague Senator Domenici, I know, has to go to 
another hearing and we're going to work to accommodate him 
after the testimony of our three people.
    Does that meet your needs, Senator Domenici?
    Senator Domenici. I have an entire delegation in my office 
now in 5 minutes so I will hope that I'll be finished in time 
to come back. I'll try my best.
    Senator Mikulski. Well, Senator, we'll certainly reserve 
the time for you and I can assure you along with Senator Shelby 
if you have questions for the record or if your staff would 
even want us to be sure we cover any ground this morning.
    Senator Domenici. We have had a very important set of 
activities regarding meth in New Mexico and I wanted to follow 
up on them and I hope I get back in time to do that.
    Senator Mikulski. And any way we can support you in doing 
that, fine.
    Why don't we then turn to, excuse me, turn to our panel to 
present their testimony. What I'd like to suggest is Mr. 
Sullivan, we start with the Bureau of Alcohol, Tobacco, 
Firearms and Explosives then go to Ms. Tandy and our very able 
Marshals Service will be the wrap up.

                SUMMARY STATEMENT OF MICHAEL J. SULLIVAN

    Mr. Sullivan. Good morning Chairman Mikulski, Ranking 
Member Shelby, and distinguished members of the subcommittee. I 
have submitted a detailed statement that I'm asking to be made 
part of the record so I only have a few brief remarks.
    This is my second time testifying before a congressional 
Appropriations Committee and my first time before the Senate 
and I'm very pleased to be here to speak on the President's 
fiscal year 2008 budget request for ATF.
    I want to thank you Chairwoman Mikulski and Ranking Member 
Shelby for your recognition of ATF. It has been my personal and 
professional honor to lead this agency for the past 7 months.
    I'm also pleased to be sitting here with Administrator 
Tandy and Director Clark, two individuals I have tremendous 
respect for.
    ATF has a long and successful history of working closely 
with DEA and the U.S. Marshals Service as well as our other 
Federal law enforcement partners including the FBI and the 
Bureau of Prisons. Such partnerships are vital to accomplishing 
our mission and serving the interests of our fellow citizens.
    As the United States attorney in Massachusetts and a former 
local prosecutor, I came through the door at ATF with a 
tremendous respect for the work that our people do, day in and 
day out, to fight violent crime, combat gang violence, and 
improve the quality of life in the neighborhoods throughout our 
country.
    I must admit however, that I was unaware of the full depth 
and breadth of the agency's mission, responsibilities and 
contributions to the safety and security of our country. I very 
much appreciate the subcommittee's support of our agency, in 
particular the interest you have taken in our mission and our 
programs.
    Thanks to the leadership of this subcommittee and the 
dedication and diligence of the men and women of ATF, our 
efforts are producing real results that make our neighborhoods, 
our country, and our world safer for everyone.
    Finally before we proceed, like many others, I would like 
to take a moment to offer my condolences to the victims, their 
families, and the university community at Virginia Tech. This 
truly was a national tragedy.
    I have three college-aged children. As a parent and as a 
citizen of the greatest country in the world, it horrifies me 
that one of our Nation's top universities could serve as the 
setting for such a horrendous and unthinkable crime of 
violence. As you know and as you have pointed out, Chairwoman 
Mikulski, State and local law enforcement authorities in 
Virginia worked around the clock to investigate the matter and 
find answers for the victims and their families.
    ATF, along with our Federal partners, FBI, DEA, and the 
U.S. Marshals Service, has been lending support to those State 
and local agencies as requested and will continue to provide 
any and all assistance that is asked of us.

                           PREPARED STATEMENT

    Chairwoman Mikulski, I look forward to working with this 
subcommittee and with you and will be pleased to answer any 
questions you might have in the course of this hearing. Thank 
you.
    Senator Mikulski. Thank you Mr. Sullivan.
    [The statement follows:]
               Prepared Statement of Michael J. Sullivan
    Madam Chairman, Senator Shelby, and distinguished Members of the 
Subcommittee, I am pleased to appear before you for the first time to 
discuss the President's fiscal year 2008 budget request for the Bureau 
of Alcohol, Tobacco, Firearms and Explosives (ATF). I very much 
appreciate the Subcommittee's support of ATF and the interest you have 
taken in our mission and programs. Thanks to the leadership of this 
Subcommittee, and the dedication and diligence of the men and women of 
ATF, our efforts are producing real results that make our neighborhoods 
and country safer.
                             atf's mission
    As you know, ATF is a principal law enforcement agency within the 
Department of Justice dedicated to reducing violent crime, preventing 
terrorism and protecting our Nation. The men and women of ATF perform 
the dual responsibilities of enforcing Federal criminal laws and 
regulating the firearms and explosives industries. The combined efforts 
of special agents and industry operations investigators allow ATF to 
effectively identify, investigate, and recommend for prosecution 
violators of Federal firearms and explosives laws; additionally, their 
teamwork enables ATF to ensure that licensees are operating within 
established laws and regulations. We are committed to pursuing our 
mission by working both independently and through partnerships with 
industry and other Federal, State, local and international law 
enforcement agencies.
                            accomplishments
    Over the past fiscal year, ATF has initiated criminal 
investigations in the following areas: 29,166 firearms cases; 4,060 
arson and explosives cases; 2,023 gang-related cases; 135 alcohol and 
tobacco diversion cases; and 47 explosives thefts, which included 3,977 
pounds of explosives, 3,627 detonators and 25,107 feet of detonator 
cord.
    In addition, in fiscal year 2006, ATF conducted 12,148 inspections 
of Federal Firearms Licensees (FFL) and 6,392 inspections of Federal 
Explosives Licensees (FEL). We also processed: 401,792 National 
Firearms Act (NFA) weapons registrations; 284,443 firearms trace 
requests; 37,390 FFL applications and renewals; 5,524 FEL applications 
and renewals; and 11,001 import permit applications.
    ATF also provided important training not only for our own 
personnel, but for our local, State, Federal and international law 
enforcement partners. For instance, in fiscal year 2006, we provided 
training for 816 members of the international law enforcement 
community. We provided Project Safe Neighborhoods (PSN) training for 
5,816 Assistant U.S. Attorneys, State and local prosecutors, State and 
local police officers and sheriffs, and ATF Special Agents. We also 
trained:
  --Over 1,100 personnel, including 500 State and local investigators 
        and bomb squad personnel, in explosives-related courses, 
        including post-blast investigations;
  --Over 700 explosives detection canine teams on peroxide-based 
        explosives;
  --450 U.S. Marshal Court Security Officers on improvised explosive 
        device (IED) familiarization and security; and
  --402 personnel in arson-related courses.
                    fiscal year 2008 budget request
    For fiscal year 2008, ATF requests $1,013,980,000 and 5,032 
positions, of which, 2,468 are agents. This request includes 
$995,023,000 and 4,984 positions for current services and $18,957,000 
and 48 positions for program improvements.
    The program improvements include $8.9 million in increased funding 
for the successful PSN initiative, ATF's firearms trafficking 
enforcement teams, and participation in the National Gang Targeting, 
Enforcement, and Coordination Center (GangTECC). These programmatic 
increases would be an important investment in the pursuit of violent 
offenders and the reclamation of communities from the scourge of gangs, 
gun crime, and local, national and international gun trafficking 
organizations.
    An additional $10 million is being requested for continuation of 
our current explosives programs which will further fulfill our 
responsibilities under the Safe Explosives Act. These funds will ensure 
that explosives industry members continue to receive their licenses in 
a timely manner and will allow ATF to provide appropriate oversight 
concerning the safe and secure storage of explosives.
            project safe neighborhoods and anti-gang efforts
    The fiscal year 2008 budget request for ATF includes six additional 
FTE (12 positions) and $2.2 million to enhance the Bureau's gang and 
firearms enforcement efforts supporting PSN nationwide. ATF will apply 
these resources to locations that have experienced an increase in 
firearms violence and will focus them on multi-defendant conspiracies 
and criminal organizations in an effort to take violent criminals off 
the street.
    ATF has been the lead Federal law enforcement agency for PSN since 
its inception in May 2001, focusing on a wide range of firearms cases--
those involving Racketeer Influenced Corrupt Organization (RICO) 
violations, firearms trafficking and the criminal possession of 
firearms by convicted felons and other prohibited persons. As the only 
Federal agency that focuses primarily on violent crime and the 
regulation of commerce in firearms and explosives, ATF exercises unique 
statutory authority over the ``tools of the trade'' that make gangs a 
threat to public safety.
    Nearly 2,000 of ATF's special agents are exclusively dedicated to 
investigating violent crime and gangs. These agents work closely with 
State and local law enforcement to investigate the most egregious 
violent criminals and violent criminal organizations. This strategy is 
employed effectively through ATF-led Violent Crime Impact Teams (VCIT), 
which are currently deployed in 25 cities across the nation. During 
fiscal year 2007, this number will expand by 5 additional cities 
bringing the total number to 30. In addition, ATF participates with 
State and local police and other Federal agencies on 110 anti-gang task 
forces.
    This past year ATF aggressively investigated and made significant 
strides in combating violent gangs. In fiscal year 2006: 2,023 gang-
related cases were initiated by ATF--an increase of 157 percent from 
2002, the first full year of PSN; 1,680 defendants referred by ATF in 
gang-related cases were convicted--an increase of 289 percent from 
2002; and 779 defendants in gang-related cases were sentenced, with an 
average sentence of 107 months.
    An outstanding example of our anti-gang efforts is Operation Mano 
Dura, an investigation of the MS-13 gang conducted by our Baltimore 
Field Division. Those indictments included charges of various RICO 
predicate acts, including seven homicides and numerous other shootings, 
beatings and other violent crimes in aid of racketeering. To date, 15 
of the defendants have been convicted and 12 are awaiting trial. Nine 
of these defendants are eligible for the death penalty.
    Another noteworthy example is the arrest and indictment of 13 
members of the MS-13 street gang in January following a year-long joint 
investigation by ATF and the Nashville Metropolitan Police Department. 
During the investigation, information was developed linking Nashville-
based MS-13 members and associates with seven shootings, three alleged 
murders, several planned murders, threats, intimidation and many other 
significant violent crimes, all of which occurred in 2006. The 
defendants were indicted on RICO charges. Several of these defendants 
also are eligible for death sentences.
    The President has identified violent street gangs as a national 
problem and has instructed the Department to institute strategies to 
address this problem. ATF has been successful in targeting high crime 
areas and dedicating investigative, inspection, analytical and 
technological resources to reduce violent crime. Through these 
strategies, ATF and the Department are acting decisively to demonstrate 
to the American public that Federal law enforcement agencies are 
working strategically to investigate, reduce and prevent violent crime. 
The additional PSN funds we are requesting will build upon proven, 
successful tactics: integrating regulatory enforcement, aggressive 
investigation techniques and the utilization of technology to impact 
violent crime.
    ATF also is requesting two positions, two agents, and $373,000 to 
dedicate to GangTECC. Established by the Attorney General, this new 
national anti-gang force serves as a coordinating center for multi-
jurisdictional gang investigations involving Federal law enforcement 
agencies. It also provides a clearinghouse for gang-related 
intelligence data, assists in developing a refined understanding of the 
national gang problem, proposes appropriate countermeasure strategies, 
and supports the National Gang Intelligence Center. Currently, three 
ATF special agents are supporting GangTECC. These agents are 
facilitating the coordination of overlapping racketeering 
investigations and ensuring that tactical and strategic intelligence is 
shared between law enforcement agencies. Moreover, an ATF agent is 
currently serving as the initial Deputy Director of GangTECC. GangTECC 
provided important assistance in the aforementioned arrests and 
indictments of the Nashville-based MS-13 gang members. Specifically, it 
facilitated communications among the various law enforcement agencies 
involved in the case, arranged for other Federal agents to support the 
investigation as needed, and arranged an urgent translation and 
transcription of communications that were garnered through undercover 
operations.
                          firearms trafficking
    Street gangs are often involved in firearms trafficking in order to 
supply guns to gang members and criminals in furtherance of drug 
trafficking and in the commission of other violent firearms-related 
crimes. To successfully fight violent crime, it is essential to prevent 
the illegal flow of firearms to criminals. ATF's firearms trafficking 
interdiction efforts advance this goal by identifying and arresting 
those persons who illegally supply firearms to gang members and 
prohibited persons such as felons and juveniles.
    ATF is requesting 34 positions, of which all are agents, and $6.3 
million to expand its domestic firearms trafficking enforcement efforts 
along the Southwest Border and nationwide to target efforts on certain 
gun trafficking corridors. With this funding, ATF will establish 
investigative teams that will be devoted to firearms trafficking 
interdiction efforts in areas of the country with the highest levels of 
out-of-State guns recovered in crimes.
    ATF will use its analytical resources to strategically deploy these 
teams. To date, ATF has determined that the following routes are 
significant regional, national and international trafficking corridors: 
The Southwest Border; the I-95 corridor between Miami and Boston; 
Northern rural Mississippi to Chicago; Northern Indiana to Chicago; the 
triangle between Los Angeles, Las Vegas and Phoenix; and Birmingham to 
Chicago.
    Several of these trafficking routes impact not only local and 
regional crime patterns, but also have international significance, 
affecting our neighbors in Canada and Mexico, as well as other Central 
and South American nations.
    In fiscal year 2006, 1,526 ATF-referred defendants in firearms 
trafficking cases were convicted. This represents an increase of 166 
percent from 2002, the first full year of PSN.
    A noteworthy example of a firearms trafficking case is Operation 
Flea Collar, a complex, 2-year undercover investigation during which 
ATF learned that two suspected traffickers were purchasing firearms at 
an FFL in Alabama and then selling them at flea markets and gun shows 
in northern Alabama. Further investigation identified unlicensed 
firearms dealers at those flea markets. It also revealed a recurring 
scheme whereby gang members or their designees were routinely 
dispatched to the Alabama flea markets and gun shows to purchase 
firearms in bulk for use by various street gangs. Ultimately, ATF 
agents estimated that the various suspects had sold thousands of 
firearms over the last several decades. At least 12 of the trafficked 
firearms have been associated with homicide investigations, including 
one linked to the attempted murder of a Chicago police officer. Many of 
the trafficked firearms also have been linked to robberies, assaults, 
drug crimes and sex crimes throughout the United States. The firearms 
have been recovered in numerous States, including Alabama, California, 
Georgia, Illinois, Maryland, Michigan, New York, South Carolina, 
Tennessee, Texas and Washington, DC. Operation Flea Collar concluded 
with the seizure of 556 firearms and the arrest of 18 individuals on 
charges stemming from the illegal sale of firearms without a license 
and the illegal sale of firearms to convicted felons and out-of-state 
residents. All 18 suspects have been convicted and sentenced, and the 
investigation is ongoing.
    Another example of a significant trafficking case involved guns and 
drugs moving between West Virginia and New York City. In 2004, our 
Wheeling Field Office opened a firearms trafficking investigation of 
two corrupt pawn dealers located in Fairmont, West Virginia. During the 
course of these investigations, special agents uncovered an interstate 
conspiracy to traffic crack cocaine in Fairmont and illegally traffic 
firearms to New York City. This investigation resulted in the Federal 
conviction of three individuals for conspiracy and three other persons 
for Federal firearms and narcotics charges.
    One final noteworthy example of a firearms trafficking case 
involved members of the ``Bloods'' street gang in New Jersey arranging 
for students at Wilberforce University in Ohio to conduct straw 
purchases of firearms in Ohio and transport them to New Jersey. The 
gang members who received the firearms used them for an assortment of 
violent crimes in New Jersey, including a drive-by shooting, armed 
robbery, crack cocaine distribution and an attempted home invasion. 
This 2-year investigation resulted in the conviction of 12 defendants 
for Federal firearms violations for trafficking 146 firearms.
    ATF is attempting to balance the resources it devotes to fighting 
violent crime and addressing the supply of firearms to criminals. 
Successfully tackling the problem of firearms trafficking requires a 
comprehensive effort and a multifaceted approach utilizing court-
authorized electronic surveillance, undercover operations, source 
development and cooperation with other law enforcement entities in 
order to be truly effective in shutting down illegal firearms markets.
                     other programs and activities
    In addition to PSN and firearms trafficking enforcement, ATF has 
other significant operations that are essential to carrying out our 
mission. Our law enforcement and regulatory responsibilities require 
ATF to maintain a host of efficient and effective activities, programs 
and facilities. I would like to take this opportunity to highlight a 
few important initiatives.
Firearms Enforcement and Investigation
    In response to firearms trafficking and related violence on both 
sides of the border with Mexico, ATF has developed a Southwest Border 
Initiative. This initiative coordinates the resources of ATF's Dallas, 
Houston, Los Angeles and Phoenix Field Divisions, as well as Violent 
Crime Impact Teams (VCIT) in Laredo, Houston, Albuquerque and Tucson. 
The initiative focuses regional and cross-border violence and firearms 
trafficking by employing geographic targeting, partnerships, technology 
and training. In addition to working with local law enforcement, ATF 
also is collaborating closely with Immigration and Customs Enforcement 
(ICE) and Mexican officials. In fact, ATF meets regularly with its U.S. 
and Mexican law enforcement partners to discuss strategies, share 
intelligence, and initiate cooperative efforts to combat crime along 
the southwest border. One important effort we are undertaking through 
partnership with the Mexican government is ensuring that U.S.-sourced 
firearms recovered in Mexico are properly identified, documented and 
submitted to ATF for tracing. ATF uses the trace results to identify 
and investigate firearms traffickers who illegally divert firearms to 
drug traffickers. To this end, we will deploy across Mexico our eTrace 
system, an Internet-based system for submitting firearms trace 
requests.
    In order to reduce violent crime, ATF has and will continue to 
develop technology to assist law enforcement at all levels. Through our 
National Integrated Ballistic Information Network (NIBIN), ATF deploys 
automated ballistics comparison equipment to participating Federal, 
State, and local law enforcement forensics laboratories--230 sites in 
total--which provides the ability to identify ballistic links between 
crimes that might not otherwise be connected. As of December 2006, 
NIBIN had nearly 1.25 million images of casings and bullets in its 
database with nearly 19,000 ``hits.'' NIBIN has many success stories, 
including a recent one from Buffalo, New York. In this case, the 
ballistics evidence gathered at eleven separate shooting scenes between 
June 2003 and October 2006 was linked to a single .45 caliber handgun 
using the NIBIN ballistic imaging system at the Erie County Forensic 
Laboratory. On November 13, 2006, the Buffalo Police Department 
executed a narcotics search warrant and recovered narcotics, firearms 
and ammunition. A recovered firearm was processed by the Erie County 
Laboratory and identified as the handgun used in the eleven shootings.
Explosives and Arson
    ATF's arson and explosives National Response Teams (NRT) provide 
expert assistance at the scenes of significant fire or explosives 
incidents. The NRT is comprised of veteran special agents with 
expertise in conducting post-blast investigations and determining the 
origin and cause of fires. In addition, the NRT is supported by all of 
ATF's arson and explosives assets, such as the Fire Research Laboratory 
(FRL), accelerant detection canines and audit services. In 2006, the 
NRT was deployed 17 times. For example, in February 2006, it was 
deployed to assist in the investigation of nine fires that occurred in 
churches in western Alabama. After a month of intense investigation, 
three suspects were arrested for the church fires.
    ATF's technical expertise is also evidenced by our three state-of-
the-art forensic laboratories and one-of-a-kind FRL. In fiscal year 
2006, our National Laboratory Center in Ammendale, Maryland, added DNA 
analysis capability to its already impressive collection of forensic 
tools. The FRL, also located at our National Laboratory Center, has the 
capability of simulating fire scenarios approaching a quarter-acre in 
size, under controlled conditions, allowing for detailed analysis. It 
is the only such facility in the United States dedicated to providing 
case support in fire investigations using forensic fire science.
    The U.S. Bomb Data Center (USBDC) is the Department's comprehensive 
repository of data pertaining to arson and explosives incidents. The 
information within the USBDC is accessible to our law enforcement 
partners and can be analyzed to determine trends, patterns, criminal 
methodologies, and, in some cases, suspects. The USBDC contains more 
than 140,000 records. Law enforcement officials can query the 
characteristics of an explosive device and match it to others with 
similar characteristics. USBDC houses several databases, including the 
Bomb and Arson Tracking System (BATS), which facilitates and promotes 
the collection and dissemination of data among local law enforcement on 
arson and explosives incidents, and DFuze, which allows international 
law enforcement agencies to compare and exchange information on 
incidents within their jurisdictions. The USBDC has adopted a new 
``Concept of Operations'' to guide it into the future. Under this plan, 
USBDC will become a Center of Excellence, hosting not only law 
enforcement officials, but also members of the intelligence community 
as well as representatives from academia and industry. USBDC will 
continue to consolidate all explosives incidents information and 
databases in an effort to be the ``one-stop shop'' for explosives 
incident information.
    Our regulatory responsibilities include enforcement of the Safe 
Explosives Act of 2002, which mandates a field inspection on all 
original and renewal applications for explosives licensees or 
permitees. Because most licenses and permits expire every 3 years, ATF 
is mandated to perform one inspection per licensee/permit user every 3 
years. Over 5 billion pounds of explosives are manufactured, imported 
and sold annually in the United States. ATF uses existing resources to 
ensure that all violations noted in such inspections are appropriately 
resolved. ATF also will continue to investigate all reported explosives 
thefts, respond to and investigate bombings and other explosives 
incidents, and assist local, State and other Federal agencies with 
explosives related issues.
Sharing Our Expertise through Partnerships and Training
    We are committed to pursuing our mission by working both 
independently and through partnerships with industry and other Federal, 
State, local and international law enforcement agencies. For instance, 
our ``Don't Lie for the Other Guy'' program is a partnership with the 
National Shooting Sports Foundation which helps educate FFLs on how to 
identify and prevent straw purchases of firearms. We also have 
partnered with The Fertilizer Institute to launch voluntary campaigns 
to raise awareness of the sale, security, storage, and transportation 
of ammonium nitrate, the substance that was mixed with fuel oil in the 
Oklahoma City bombing. In addition, ATF has maintained outstanding 
relationships with a number of influential professional organizations 
including the International Association of Chiefs of Police, the 
International Association of Bomb Technicians and Investigators, the 
National Sheriffs' Association, Major Cities Chiefs Association, and 
the National Bomb Squad Commanders. ATF also has collaborative research 
partnerships with the U.S. Army Engineer Research and Development 
Center; Oak Ridge and Lawrence Livermore National Laboratories; the 
University of Missouri, Rolla; and the University of Massachusetts, 
Lowell. Moreover, ATF closely and regularly collaborates with the 
Departments of State, Defense and Homeland Security; and other 
components of the Department of Justice. We also work with INTERPOL and 
EUROPOL; and representatives of foreign governments, including the 
United Kingdom, Mexico, Colombia, Israel and Canada.
    At ATF's Canine Training Center in Front Royal, Virginia, ATF 
trains explosives detection and accelerant detection canines for use by 
Federal, State, international and local law enforcement and public 
safety officials. ATF is committed to ensuring that DOJ's canines 
conform to applicable ATF standards. In order to keep canine 
capabilities able to meet current threats, ATF has initiated a program 
to offer advanced training in the detection of organic peroxide-based 
explosives to law enforcement canine teams. At the request of the 
National Bomb Squad Commanders Advisory Board, ATF developed National 
Odor Recognition Testing to verify that explosives detection canines 
meet a national standard. During fiscal year 2006, the project 
certified approximately 150 non-DOJ canine teams, and has already 
certified 124 canine teams in fiscal year 2007. In addition, ATF has 
trained more than 350 explosives detection canines in 16 countries.
    With respect to training, the National Center for Explosives 
Training and Research (NCETR) offers numerous advanced courses related 
to explosives disposal and post-blast investigation techniques. NCETR 
provides training for State, local and international law enforcement, 
the U.S. Department of State and all branches of the Armed Forces. It 
also provides training for Army explosives units prior to their 
deployment in Iraq. NCETR has trained almost 6,000 bomb technicians and 
investigators in explosives disposal and investigative techniques. Each 
year, requests for explosives-related training have increased, and 
present demand exceeds our capability. The fiscal year 2006 Conference 
Agreement (Public Law 109-108) directed ATF to plan for the 
construction of a permanent facility co-located with other law 
enforcement and Federal government entities that provide similar 
training and research. Subsequently, we have selected a site at 
Redstone Arsenal in Alabama. To date, ATF has received a letter of 
intent memo from Redstone Arsenal for a commitment of resources, such 
as ranges, classrooms, explosives storage bunkers, land to build an 
administration/classrooms building and housing billets. ATF also has an 
interagency agreement with the Army Corps of Engineers (COE) for design 
and planning of the NCETR. This planned permanent facility for NCETR 
will promote efficiency by consolidating other Department of Justice 
and Department of Defense explosives training and research in one 
location. These collective resources will provide a unique opportunity 
to leverage assets, knowledge and expertise in the field, providing 
Federal, State, local and international law enforcement explosives 
expertise in one location.
Alcohol and Tobacco Diversion
    ATF also combats the illegal diversion of alcohol and tobacco 
products by criminal gangs, organized crime, and terrorist groups. The 
illicit sale of these commodities causes a substantial loss of excise 
tax revenue to both the Federal and State governments. Moreover, there 
have been instances in which terrorist groups are using proceeds from 
tobacco trafficking to finance their organizations and activities. By 
utilizing the Contraband Cigarette Trafficking Act, RICO, wire fraud, 
mail fraud, and money laundering statutes, ATF has built complex cases 
against individuals who have used proceeds from the illegal trafficking 
of cigarettes to fund organized crime and terrorism. ATF's 
investigations into illicit trafficking of tobacco products and 
enforcement of existing statutes continue to become more refined. In 
fiscal year 2002, 18 defendants were convicted on tobacco diversion-
related charges. Every year since, there has been an increase in the 
number of defendants convicted of these crimes as a result of ATF's 
efforts. In fiscal year 2006, 108 defendants were convicted of tobacco 
diversion-related offenses as a result of ATF's work--that is a 600 
percent increase in defendants convicted over a 5-year period. ATF will 
continue to fight the illicit trafficking of both alcohol and tobacco 
products, whether the means of illicit trafficking are more traditional 
in nature or contemporary such as Internet sales.
International Programs
    In addition to the training NCETR provides to Army explosives units 
prior to their deployment to Iraq, ATF is lending its expertise to U.S. 
efforts in Iraq in a variety of ways. Since March 2005, ATF has 
deployed Special Agent Certified Explosives Specialists and Explosives 
Enforcement Officers to support the Iraq Combined Exploitation Cells 
(CEXC) within the U.S. Military Central Command. ATF explosives experts 
provide onsite investigative assistance in processing post-blast 
incidents directed at United States and allied forces and we also 
provide post-blast training for the Iraqi National Police. In addition, 
ATF employs explosives detection canine teams in Iraq and throughout 
the Middle East--these teams often are directly responsible for 
locating hidden explosives and weapons in enforcement actions conducted 
by host governments against terrorist groups. Moreover, ATF has special 
agents assigned to the Regional Crimes Liaison Office and the Major 
Crimes Task Force in Iraq to assist in the investigation and 
prosecution of war crimes and other criminal activity. ATF will 
establish a temporary duty presence of four ATF agents at the new U.S. 
Embassy in Baghdad later this year.
    Finally, ATF is a managing partner in the Terrorist Explosive 
Device Analytical Center (TEDAC). This joint DOJ-DOD program is housed 
at the FBI Laboratory in Quantico, Virginia, with an ATF special agent 
serving as the Deputy Director. At the TEDAC, ATF and other partners 
analyze IEDs from Iraq and Afghanistan in an effort to identify bombers 
and prevent further attacks. TEDAC's evaluation of terrorist IED 
components to identify similarities and its collection of latent prints 
and DNA from those devices helps identify bombing suspects and provides 
vital intelligence to military and law enforcement officials.
                                closing
    Chairman Mikulski, Senator Shelby, distinguished Members of the 
Subcommittee, on behalf of the men and women of ATF, I thank you and 
your staff for your support of our crucial work. While the list of ATF 
programs and facilities I have noted today is far from comprehensive, 
it is intended to provide the Subcommittee with a sampling of the depth 
and breadth of our activities.
    ATF is protecting the American public from the threats of violent 
crime and terrorism. As noted previously, we initiated over 2,000 gang-
related cases in fiscal year 2006. That is an increase of over 157 
percent from 2002, the first full year of PSN. We will continue to 
enforce the Safe Explosives Act and provide the education and 
regulatory oversight to an industry that manufactures, imports, and 
sells over 5 billion pounds of explosives every year. ATF will continue 
to investigate incidents involving nearly 4,000 pounds of stolen 
explosives, and we will continue to inspect approximately 12,000 
Federal Explosives Licensees and Permitees. We also will continue to 
share our expertise with our partners and provide invaluable training 
in a number of areas, including courses on post-blast investigative 
techniques and courses for explosives detection canine teams.
    With the backing of your Subcommittee, ATF can continue to build on 
these accomplishments, making our nation even more secure. The $2.2 
million we have requested to expand PSN and the $6.3 million to 
establish firearms trafficking teams are two important investments in 
this cause. We look forward to working with you in pursuit of our 
shared goals.
                                 ______
                                 
               Biographical Sketch of Michael J. Sullivan
    Michael J. Sullivan was designated the Acting Director of the 
Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) in August 
2006 by President George W. Bush. In this position, Sullivan oversees 
nearly 5,000 ATF employees and an annual budget of close to $1 billion. 
He ensures that ATF fulfills its mission of preventing terrorism, 
reducing violent crime, and protecting our Nation.
    As United States Attorney for the District of Massachusetts since 
September 2001, Sullivan has worked aggressively to combat terrorism. 
He established a counterterrorism unit in his office; formed an Anti-
Terrorism Task Force comprised of federal, state and local law 
enforcement to prevent future terrorist attacks; and prosecuted the so-
called ``shoe bomber'' Richard Reid.
    In addition to combating terrorism, Sullivan has focused on 
protecting youth and safeguarding communities from the threat of 
violence. As U.S. Attorney, Sullivan followed through on the 
President's Project Safe Neighborhoods Initiative to safeguard our 
communities by developing a Community Prosecution and Crime Reduction 
Unit to enforce the federal gun laws and develop highly targeted gun 
crime reduction strategies. Through his innovative efforts, Sullivan 
has elicited unprecedented cooperation among federal, State and local 
law enforcement agencies to target gun crime in Boston and across the 
State. From fiscal year 2000-2005, Sullivan increased federal gun 
prosecutions under existing laws by 114 percent in Massachusetts.
    Sullivan also created a unit within his office to target computer 
hacking and high technology crimes, including identity theft, Internet 
auction and credit card fraud, economic espionage, copyright and 
trademark violations. Under his leadership, the U.S. Attorney's Office 
in the District of Massachusetts has recovered more than $3 billion for 
the federal government. Sullivan serves on the Attorney General's 
Advisory Committee and chairs the Health Care Fraud Subcommittee.
    Before serving as U.S. Attorney, Sullivan was appointed District 
Attorney of Plymouth County by Massachusetts Governor William F. Weld 
in May 1995. He was elected to the position in November 1996 and again 
in 1998. One of Sullivan's top priorities during his tenure as District 
Attorney was to address the issue of unsolved homicides in the county. 
This initiative resulted in the resolution of a significant number of 
murders. In addition, he became known as a leader in the fight against 
child abuse, domestic violence and elder abuse.
    Sullivan began his public service in 1990 when he was elected to 
the Massachusetts State House of Representatives, where he served for 
three terms. As a legislator, Sullivan was a strong proponent of 
criminal justice reform.
    Prior to his public service, Sullivan worked at the Gillette 
Company for 16 years. He started as a stock clerk at the age of 18 and 
rose to positions in human resource management and quality operations 
before becoming assistant to the president. While employed at Gillette, 
Sullivan graduated from Boston College cum laude and Suffolk University 
Law School cum laude.

                    Drug Enforcement Administration

STATEMENT OF HON. KAREN P. TANDY, ADMINISTRATOR
    Senator Mikulski. Ms. Tandy.
    Ms. Tandy. Madam Chairman and members of the subcommittee 
and Ranking Member Senator Shelby, it is my pleasure to discuss 
the President's 2008 budget request for the Drug Enforcement 
Administration.
    I want to thank this subcommittee for its support of DEA as 
we lead the Nation's fight against drugs and Senator Mikulski, 
we are particularly grateful to you for including the $25 
million in the supplemental spending bill that would lift our 
hiring freeze at DEA and fund our counterterrorism initiatives.
    In unprecedented numbers, DEA has been toppling cartel 
kingpins and stripping their drug trafficking organizations, 
not only of massive amounts of drugs, but also their illicit 
revenues. By 2009, our goal is to take $3 billion each year 
from these international drug trafficking networks that are 
operating in this country.
    In the last 2 years combined, we stripped drug trafficking 
organizations of $3.5 billion in revenue through the seizure of 
assets and drugs and already, just halfway through this fiscal 
year of 2007, we have seized an astounding $1.1 billion. This 
figure includes $90 million in cash and gold that DEA and our 
Colombian partners stripped from the North Valley cartel in 
January. For 60 days thereafter this was the world record for 
cash seizures until our Mexican partners, with whom we have 
been working more closely than ever over the past year, made 
the single largest cash seizure that the world has ever seen 
stripping methamphetamine chemical traffickers of $207 million 
in cash. That is the cash that's reflected here in this poster 
before the subcommittee.
    Two days later DEA information resulted in another record 
setting seizure. This time instead of cash it was drugs, 21 
tons of cocaine off of the coast of Panama that was worth more 
than $300 million wholesale which is the photo on the two 
posters to my left.
    Senator Mikulski. So it's one that, trifocals, always there 
where you don't need them but is that like a container ship? 
Where the cargo was literally drugs?
    Ms. Tandy. That is correct. It was a container ship off of 
Panama. The actual 21 tons of cocaine was brazenly on top of 
the deck of the container ship without concealment.
    With these unrelated operations, DEA dealt Mexican 
traffickers a one, two punch. They're down more than $500 
million in blood money in simply 48 hours. Other enforcement 
actions have impacted these traffickers as well.
    In January, DEA agents took custody of 10 major drug 
traffickers on U.S. soil in an unprecedented extradition from 
Mexico. These extraditions included violent kingpins and 
leaders from all four of Mexico's major drug cartels and with 
us, as we took custody, were the United States Marshals to whom 
we turned these traffickers over.
    Less than 2 months ago, DEA dismantled the United States 
infrastructure of a powerful Mexican drug cartel that Senator 
Shelby referenced in his opening statement. As the Senator 
noted, that included the arrest of more than 400 members of 
this organization throughout the United States, the seizure of 
$46 million in cash as well as 18 tons of marijuana, cocaine, 
meth, and heroin and thanks to Federal legislation that was 
passed by Congress, as well as State legislation and toughened 
enforcement efforts over the last 5 years, we've slashed the 
number of small toxic meth labs in this country by 61 percent 
and super lab seizures are down in the United States, 
plummeting 94 percent.
    All of these efforts by DEA and our partners are affecting 
drug organizations financially and operationally. According to 
recent intelligence, some trafficking organizations are now 
having difficulty finding transportation groups to move cocaine 
from Mexico to the United States. That in turn has led to a 
significant surcharge to the price of a kilogram of cocaine and 
in addition to that are some U.S. based meth traffickers that 
are having difficulty acquiring meth from some sources of 
supply in Mexico.
    I believe I'm taking the hint here that I am.
    Senator Mikulski. First of all what you've just told us is 
a phenomenal set of accomplishments. They're breathtaking and 
you go ahead and you finish your testimony, don't worry about 
some little huchipoo red light going off.
    You've got the green light after what you're telling us to 
do anything you want to do here today.
    Ms. Tandy. You are very generous, Senator. Thank you so 
much.
    These DEA victories in reducing the drug supply have also 
contributed to the 23 percent drop in our Nation's drug use 
over the past 5 years because as this subcommittee well knows, 
if drugs are plentiful, the demand reduction education efforts 
will not take root and drug treatment won't succeed.
    Despite these achievements though, DEA does face challenges 
fighting an evolving drug trade. First, we no longer just fight 
traditional drugs of abuse. In just 5 years the number of 
Americans abusing prescription drugs rose more than two-thirds, 
from 3.8 million abusers to 6.4 million and fueling this 
increase is the proliferation of illicit Internet web sites 
that make it possible with one simple click to purchase 
controlled substances. With additional funds DEA can do more of 
these online diversion investigations.
    Second, we need to increase our enforcement along the 
Southwest border where approximately 85 percent of the drugs 
are smuggled into this country. Additional funds will allow us 
to step up our fight there with improvements to our aviation, 
surveillance, and communication systems.
    A third challenge is our limited intelligence 
infrastructure. For example, if a multi-ton load of cocaine is 
seized off the African coast and DEA received classified 
intelligence about it, we need to pass that classified 
intelligence and work that information via our classified 
backbone which is known as our Merlin System.
    The problem is that we do not have the Merlin System in 
computer terminals anywhere in Africa or the Middle East. These 
computers are in limited places in South America and Europe. 
The ones we do have in the United States are aging and in dire 
need of upgrades and without an enhancement DEA cannot readily 
share and investigate the kind of information that's necessary 
to take down the drug trafficking cartels or to fulfill our 
responsibilities in the intelligence community.
    Finally, intercepting traffickers' communications has been 
DEA's most valuable weapon and traffickers now have the 
Internet and encrypted communications technology at their 
disposal. Consequently we are seeking an enhancement to expand 
our Internet capabilities so that we can get a trafficker's 
encrypted communications in the same way as we now get the 
trafficker's land line and cell phone conversations through a 
court order.

                           PREPARED STATEMENT

    These budget enhancements would allow DEA to fight the drug 
trade across our Nation, the globe and cyberspace and it will 
also help put the DEA back on a solid financial footing that's 
necessary to carry out these responsibilities and on behalf of 
the almost 11,000 men and women of the Drug Enforcement 
Administration, I thank this subcommittee for all of your 
support throughout the years that we have been undertaking 
these challenges. Thank you.
    Senator Mikulski. Thank you very much, Miss Tandy. I think 
it shows how important this hearing is and Mr. Clark why don't 
you tell us how the marshals ride a different kind of posse but 
still come in to save Miss Kitty and a lot of other people in 
the community.
    [The statement follows:]
               Prepared Statement of Hon. Karen P. Tandy
    Madam Chairman and Members of the Subcommittee: Good morning, and 
thank you for inviting me to testify on behalf of the President's 
fiscal year 2008 budget request for the Drug Enforcement Administration 
(DEA). I have had the pleasure of working closely with some of you over 
the last four years. To those Members who are new to this panel, I 
welcome the opportunity to share the DEA story and to express my 
appreciation to you in advance for supporting the courageous men and 
women of the DEA.
    I am privileged to lead a worldwide drug law enforcement 
organization of more than 10,000 people, including over 700 people 
stationed in 62 countries. DEA employs a time-tested, multi-front 
strategy to fight global drug traffickers that are motivated solely by 
the desire for profit--profits that are generated by human misery. We 
must battle these well-organized, highly sophisticated organizations at 
every juncture: from the cultivation or manufacturing stage, through 
the transit zones to final distribution in our nation's communities; 
and, finally, we must be there when they launder the proceeds of their 
operations.
    The criminals we investigate are located throughout the world and 
we search them out wherever they are: in both hemispheres and 
increasingly in the ever-expanding realm of the Internet. We attack the 
economic basis of the drug trade and reduce the diversion of licit 
drugs. We support counterterrorism activities, assist our state and 
local law enforcement partners, and serve as an information resource 
for state and local communities to help them reduce the demand for 
illicit drugs.
    The support that this Committee provides allows us to work toward 
making America's neighborhoods safe and drug-free, and for that, we at 
DEA are very grateful.
    I would like to begin my testimony by sharing two pieces of good 
news with the Committee: First, teenage drug use is down; and second, 
DEA is hitting the world's drug traffickers harder than ever before.
                        teenage drug use is down
    In 2002, the President set ambitious goals to reduce drug use: a 10 
percent reduction over two years and a 25 percent reduction over five 
years. We have exceeded the first goal: drug use by young people is 
down 11 percent. And the second goal has nearly been reached: since 
2001, overall illicit drug use among teens has declined by 23 percent. 
This data, released in December 2006 by the National Institute on Drug 
Abuse (NIDA) means that 840,000 fewer teenagers have been damaged by 
the corrosive effect of drugs.
    Some specifics from the Substance Abuse and Mental Health Services 
Administration (SAMHSA) report include: marijuana use among teenagers 
has dropped by 25 percent since 2001; methamphetamine use by teenagers 
is down by 50 percent since 2001; ecstasy use by 8th graders decreased 
by 61 percent and dropped by 54 percent for 10th and 12th graders since 
2001; cocaine use among high school seniors declined by 55 percent 
between 1986 and 2006; steroid use by teenagers decreased by 20 
percent; LSD use fell by 60 percent for 8th graders, by 53 percent 
among 10th graders, and by 74 percent among high school seniors.
    Madam Chairman and Members of the Subcommittee, DEA works 24/7 to 
enforce our country's federal drug laws. Aggressive enforcement not 
only limits supply and increases the price of drugs, it provides a 
deterrent effect that may contribute to the decline in drug use. We who 
fight very hard to keep the poisonous chemicals from reaching young 
people see the statistics I just cited as a very positive trend. We 
hope it represents a fundamental and lasting downward shift in illicit 
drug use among young Americans.
             enforcement successes over the last 12 months
    I would also like to share with you some of DEA's most significant 
accomplishments during the past year. For example, just one month ago, 
our partners in Mexico, with whom we have been working over the last 
year on a pseudoephedrine investigation, made the single largest 
worldwide cash seizure--$207 million in U.S. currency. Forty-eight 
hours later, as a result of joint DEA and Panama law enforcement 
intelligence, the U.S. Coast Guard made the largest maritime seizure on 
record--21 metric tons of cocaine bound for Mexico. The seizure denied 
Mexican drug lords $300 million in drug revenue and severely disrupted 
their transportation network.
    In the information that follows, I will highlight some individual 
cases and discuss the underlying strategies that led to such successful 
operations. An attachment to my statement provides an overview of the 
leading drug threats facing the United States and some additional 
examples of DEA's work against each of these threats.
Attacking the Economic Basis of the Drug Trade
    Successes include:
  --Indicting 50 leaders of a designated Colombian foreign terrorist 
        organization on charges of importing more than $25 billion 
        worth of cocaine into the United States. This represents more 
        than 60 percent of the cocaine entering the country.
  --Dismantling the Cali Cartel of Colombia, which is responsible for 
        the export of multi-ton maritime shipments of cocaine to the 
        United States. High ranking cartel members were sentenced in 
        2006, with resulting forfeitures of more than $300 million. 
        During the 1990s, the cartel was one of the world's most 
        powerful criminal organizations, estimated at one time to be 
        responsible for up to 80 percent of the cocaine smuggled into 
        the United States.
  --Arresting more than 400 individuals nationwide, following a 20-
        month, DEA-led investigation into a Mexican drug syndicate and 
        its U.S.-based distribution cells. The investigation has 
        resulted in the seizure of approximately $45.2 million in U.S. 
        currency, 27,229 pounds of marijuana, 9,512 pounds of cocaine, 
        705 pounds of methamphetamine, 227 pounds of pure 
        methamphetamine or ``ice'', 11 pounds of heroin, $6.1 million 
        in property and assets, and 100 weapons and 94 vehicles.
  --Arresting a Canadian international money manager who, subsequently, 
        was indicted for conspiracy to launder $1 billion in proceeds 
        from narcotics trafficking and securities and bank fraud.
  --Dismantling a Brazilian Consolidated Priority Organization Target 
        (CPOT)--the world's ``Most Wanted'' drug trafficking and money 
        laundering organizations that was responsible for smuggling 
        into the United States more than 15 tons of cocaine each month 
        from Colombia. The dismantlement resulted in 100 arrests and 
        the seizure of 52 tons of cocaine and nearly $70 million in 
        assets, including three islands off the coast of Panama.
  --Extraditing a Colombian drug kingpin to the United States who had 
        been indicted for importing cocaine and heroin worth an 
        estimated $100 million.
  --Dismantling a Canadian-based trafficking organization that smuggled 
        more than $5 million worth of ecstasy from Canada into the 
        United States.
  --Arresting 26 members of a Colombian organization that laundered 
        millions of Colombian dollars through the Black Market Peso 
        Exchange. As part of the operation, more than $10 million in 
        drug proceeds and $6.5 million in cocaine, heroin, and 
        marijuana were seized.
  --Arresting three Colombian traffickers who laundered $3 million in 
        proceeds that were derived from cocaine distribution rings that 
        operated internationally in Colombia, Mexico, and Europe.
Reducing the Diversion of Licit Drugs
    Successes include:
  --Immediately suspending the DEA registrations of 13 pharmacies that 
        used their DEA registrations to fill controlled substances 
        orders for rogue Internet pharmacies. Eight of the 13 
        suspensions were issued in February 2007. The pharmacies 
        suspended were responsible for distributing more than 75 
        million dosage units of controlled substances in 2006, the vast 
        majority of which was distributed based on invalid 
        prescriptions originating with rogue Internet pharmacy 
        websites. Ten of the pharmacies together purchased 45 million 
        dosage units of hydrocodone, which is 64 times the amount ten 
        average pharmacies would annually dispense.
  --Overseeing the largest steroid enforcement operation in U.S. 
        history. On December 14, 2005, Operation Gear Grinder resulted 
        in the arrest of five individuals who were responsible for 
        importing anabolic steroids into the United States. This 
        international investigation targeted the eight largest anabolic 
        steroid manufacturing companies in Mexico, including three of 
        the world's largest that conducted their sales via the 
        Internet. Nearly 82 percent of the steroids seized and analyzed 
        in 2003 are of Mexican origin and the majority of this 82 
        percent originated from the eight companies charged in 
        Operation Gear Grinder.
  --Arresting four individuals in Miami, Florida, who have been charged 
        with the nationwide Internet distribution of large quantities 
        of Schedule III and Schedule IV controlled substances. Sales 
        exceeded $200 million over a three-year period. The 
        investigation included the seizure of $817,000 in cash, $4.2 
        million worth of property, two automobiles, and one marine 
        vessel.
  --Indicting 11 individuals and an Atlanta-based company on charges of 
        mail fraud, distribution of controlled substances, and the 
        introduction of adulterated and misbranded drugs. The 
        defendants allegedly manufactured millions of pills--
        approximately 24 different drugs--that were marketed through 
        Internet ``spam'' advertisements. In addition to the forfeiture 
        of numerous properties, automobiles and bank accounts, the 
        indictment is seeking a monetary judgment of not less than 
        $19.8 million.
  --Arresting five individuals in the Chicago, Illinois area, as part 
        of an operation involving the illegal Internet distribution of 
        prescription drugs and anabolic steroids. The diversion scheme 
        included the wire transfers of thousands of dollars, and the 
        Internet distribution of thousands of dosage units of 
        controlled substances lacking valid prescriptions.
Working With State and Local Law Enforcement Organizations
    Successes include:
  --Dismantling the largest marijuana-laced candy manufacturing 
        organization in the western United States. The five-month 
        investigation resulted in the arrest of the organization's 
        leader, and the seizure of more than 4,000 marijuana plants, 
        $100,000 in U.S. currency, three firearms, and hundreds of 
        marijuana-laced food products. The marijuana-laced products, 
        packaged to mimic legitimate food products, included labels 
        such as ``Buddafingers,'' ``Munchy Way,'' and ``Pot Tarts.'' 
        The items were packaged in large boxes for distribution to 
        cannabis clubs throughout the West Coast and over the Internet.
  --Working with the St. Paul, Minnesota Police Department on an 
        operation that resulted in the arrest of 26 individuals 
        associated with the Latin Kings street gang. The arrests, one 
        of the largest drug takedowns in Minnesota history, were based 
        on narcotics and firearms conspiracy violations and the 
        possession and distribution of methamphetamine, cocaine, and 
        marijuana.
  --Working with the New York City Police Department on an operation 
        that resulted in the arrest of 20 individuals involved in a 
        Panama/U.S. heroin drug smuggling operation. The smuggling was 
        carried out by dozens of ``swallowers'' who were paid a fee 
        plus reimbursements for airfare and hotel expenses. Over three 
        kilograms of heroin were seized in the New York City area, and 
        $300,000 in wire transfer receipts was recovered.
  --Working with Seattle, Washington area law enforcement agencies on 
        an operation that targeted violent methamphetamine traffickers, 
        resulted in the arrests of 38 individuals. The investigation 
        netted the seizure of methamphetamine, marijuana, cocaine, 
        crack cocaine, oxycodone, eight weapons, and 10 vehicles.
  --Working with St. Louis, Missouri area law enforcement agencies on 
        an operation that resulted in the indictment of 30 individuals 
        on charges of distributing approximately 50 kilograms of 
        cocaine with a street value of $1 million.
    The accomplishments just listed are impressive on their own. But, 
they are the result of a carefully planned strategy that guides DEA 
operations around the world.
    Attacking the Drug Syndicates.--Significantly reducing the supply 
of illicit drugs is attainable if we disrupt or dismantle the drug 
trafficking and money laundering organizations that are primarily 
responsible for supplying them. At DEA, we refer to this approach as 
priority targeting. By using intelligence that we meticulously gather 
to identify the syndicates and coordinating our investigations against 
all levels of the drug and money supply chain, we are able to focus on 
the most important links in the supply chain.
    We are proud of our successes. In fiscal year 2006, 85 percent (39 
of 46) of the leaders of the most wanted international drug 
organizations (CPOTs) were indicted and 37 percent (17) were arrested. 
Terrorist-linked Priority Target Organization (PTO) investigations 
increased by 16 percent, comparing fiscal year 2005 investigations (82) 
to fiscal year 2006 investigations (95). Furthermore, between fiscal 
years 2003 and 2006, 13 drug organizations with terrorist links were 
disrupted and 20 were dismantled.
    Attacking the Economic Basis of the Drug Trade.--As a federal 
prosecutor, I saw firsthand the importance and value of stripping drug 
traffickers of their revenue. It works. I brought that experience with 
me when I came to DEA and shortly thereafter developed a five-year 
revenue denial plan. In the first two years, DEA has denied more than 
$3.5 billion through the seizures of both assets and drugs. This total 
amount exceeds the goal for the first two years of the plan by $1 
billion. The $1.6 billion denied in fiscal year 2006, includes $1.1 
billion in total assets and cash seized. With regard to high-value cash 
seizures (those over $1 million), 63 were made in fiscal year 2006, 
which represents a 44 percent increase since fiscal year 2004. DEA's 
Money Trail Initiative, launched in 2005, is a financial crime strategy 
that focuses on identifying and disrupting the flow of money back to 
the sources of drug supply, thereby crippling the ability of criminals 
to operate. In 2006, Money Trail operations resulted in more than 400 
arrests and the seizure of approximately 10,000 kilograms of cocaine, 
60,000 kilograms of marijuana, 9 kilograms of heroin, approximately 300 
pounds of methamphetamine, more than 60 dosage units of MDMA, 250 
vehicles, approximately 80 weapons, $65 million U.S. currency, and 
$14.6 million in other assets. Our fiscal year 2006 financial 
investigations of PTOs increased by 28 percent over fiscal year 2005 
(117 active cases in fiscal year 2005; 150 active cases in fiscal year 
2006). The number of financial investigation cases in fiscal year 2006 
that led to the disruption of a PTO increased by 100 percent over 
fiscal year 2005 (9 cases in fiscal year 2005; 18 cases in fiscal year 
2006). The number of financial investigation cases in fiscal year 2006 
that led to the dismantlement of a PTO increased by 138 percent over 
fiscal year 2005 (8 cases in fiscal year 2005; 19 cases in fiscal year 
2006).
    Forging International Partnerships--Mexico.--Experience has shown 
that strong international partnerships are vital in the drug law 
enforcement arena. A robust U.S./Mexico partnership, for example, is 
key if we are to reduce significantly the flow of drugs to the United 
States from Mexico, and halt the smuggling of the millions of pounds of 
bulk cash into Mexico that were generated from the sale of billions of 
dollars worth of illicit drugs in the United States. The 2007 National 
Drug Threat Assessment, which is prepared by the Justice's National 
Drug Intelligence Center, states that ``The Southwest Border remains a 
serious area of concern for U.S. drug money laundering.'' Furthermore, 
the assessment states that ``Mexican and Colombian Drug Trafficking 
Organizations (DTOs) together generate, remove, and launder between 
$8.3 billion and $24.9 billion in wholesale distribution proceeds from 
Mexico-produced marijuana, methamphetamine, and heroin and South 
American cocaine and heroin annually.'' Working with the Mexican and 
Colombian governments will help address this major problem. In May 
2006, the Attorney General unveiled a strategy to combat 
methamphetamine that calls for joint DEA/Mexico initiatives including: 
establishing specialized methamphetamine enforcement teams on either 
side of the border; developing a list for targeting the Most Wanted 
chemical and drug trafficking organizations; donating refurbished DEA 
clandestine laboratory enforcement trucks to Mexico for specialized 
enforcement teams' use. Since the launch of the strategy, over 2,100 
Mexican police officers have been trained to improve their 
methamphetamine trafficking investigative and enforcement skills.
    The U.S./Mexico partnership has already begun paying dividends. In 
August 2006, Mexican authorities seized a large-scale clandestine 
methamphetamine laboratory. The seizure netted 100 kilograms of 
finished methamphetamine, 3,000 liters of various solvents and 
chemicals, and four barrels of iodine. Due to its size and production 
capability, the laboratory is classified as a ``super lab''. More 
recently, a DEA-trained unit of Mexican police officers discovered an 
operational super methamphetamine laboratory in December 2006, that, 
based on the amount of equipment, chemicals and resources discovered, 
is likely the largest laboratory to be found in Mexico to date.
    With regard to major arrests, a DEA-led Organized Crime Drug 
Enforcement Task Force (OCDETF) investigation led to the August 2006 
apprehension of the leader of a Mexican narcotics trafficking 
organization that, over the past decade, has flooded our country with 
hundreds of tons of cocaine and marijuana, as well as very large 
quantities of methamphetamine and heroin. The leader, Francisco Javier 
Arellano-Felix, and one of his lieutenants, Manuel Arturo Villarrel-
Heredia, have been charged with racketeering, drug trafficking, and 
money laundering offenses, and if convicted will be eligible for the 
death penalty.
    The January 2007 extradition of 15 violent Mexican criminals, 
including the leaders from all four of Mexico's major drug cartels, was 
a watershed event in the annals of U.S./Mexico relations. The 
extraditions mark the reversal of a long-standing Mexican government 
policy of not extraditing jailed citizens until the sentences handed 
down by Mexican courts had been served. One of the extradited kingpins 
commanded a drug cartel considered to be among the most brutal and 
powerful in the world. He directed the smuggling of between four and 
six tons of cocaine per month over the U.S. border. It is a drug law 
enforcement development of enormous significance, and we view it as 
major progress on more than one front.
    Forging International Partnerships--Afghanistan.--Combating the 
world-wide threat posed by heroin production in Afghanistan is a major 
challenge. A flourishing narcotics trade further weakens an already 
fragile country, and it must be attacked aggressively. For our part, 
DEA and the government of Afghanistan have formed a partnership with 
the goal of developing and expanding the capabilities of its law 
enforcement community. Our five Foreign-deployed Advisory and Support 
Teams advise, train, and mentor their Afghan counterparts in the 
National Interdiction Unit of the Counter Narcotics Police--
Afghanistan. This program supplements our Kabul Country Office as well 
as ``Operation Containment'', a successful DEA initiative that was 
launched post September 11, 2001. It emphasizes coordination and 
information-sharing among 18 countries. Its aim is to choke the flow of 
drugs, precursor chemicals, and money into and out of Afghanistan. 
Madam Chairman and Members of the Subcommittee, we are seeing results 
from taking a regional, multi-national enforcement approach to a threat 
with worldwide implications. Over the last two years, Operation 
Containment has resulted in the seizure of approximately 17 metric tons 
of heroin, more than 170 metric tons of marijuana, and nearly 300 
opium-to-heroin conversion laboratories. Additionally, more than 900 
suspects have been arrested, and of those arrests, four of the six Most 
Wanted Operation Containment targets are now incarcerated. Moreover, 
intelligence developed by DEA in conjunction with other agencies has 
helped to thwart rocket and Improvised Explosive Device attacks on 
Afghan and coalition forces in Afghanistan. The 2006 convictions and 
sentencing of three major Afghan traffickers are yet another important 
byproduct of the DEA/Afghanistan partnership.
    As I conclude the discussion of international partnerships, I want 
to add a few words about the International Drug Enforcement Conference 
(IDEC). As you may know, this global forum was established in 1983, to 
bring together high-level drug law enforcement officials from 
throughout the Western Hemisphere. Its purpose is to share drug-related 
information and to develop a coordinated approach to law enforcement 
efforts against international drug organizations. As the DEA 
Administrator, I am the Co-President of the IDEC. In May 2006, I had 
the pleasure of addressing the conference's 24th gathering, which has 
grown to include representatives from 76 countries located in both 
hemispheres. Seven countries became new members in 2006: Afghanistan, 
Indonesia, Malaysia, New Zealand, Poland, South Africa, and the United 
Kingdom. The 2006 IDEC was a great opportunity to discuss our 
respective challenges and frustrations and to talk about how we could 
build on our accomplishments through even stronger multi-lateral 
partnerships that are beneficial to all parties.
    Fighting Methamphetamine--A Drug of Special Concern.--Before I 
begin a discussion of our fiscal year 2008 budget request, I would like 
to take a minute to talk about a drug of special concern to many 
Members of Congress: methamphetamine.
    As I mentioned in my opening comments, a 50 percent decline in 
methamphetamine use by teenagers since 2001, as reported by the 
National Institute on Drug Abuse (NIDA) in December 2006, is a dramatic 
and much-welcomed development. At the same time, this deadly drug 
remains a problem. DEA takes a comprehensive approach to fighting the 
drug--domestic and international enforcement and precursor chemical 
control, the identification and cleanup of large and small toxic 
laboratories, and an aggressive attack on the money flow. In fiscal 
year 2006, DEA spent an estimated $217 million for methamphetamine-
related activities. This included approximately $196 million for 
methamphetamine investigations and $21 million for clean-up, safety, 
and training programs. DEA also provided clandestine laboratory 
training to more than 1,000 state and local law enforcement officers 
during fiscal year 2006.
    Implementing The Combat Methamphetamine Epidemic Act of 2005.--The 
provisions of the law aimed at the domestic and international 
regulation of precursor chemicals make it possible to place reasonable, 
common sense limitations on the availability of the products used in 
the manufacturing of methamphetamine. Sales at the retail level are 
controlled through such measures as keeping products stored in locked 
containers, requiring face-to-face sales and photograph identification, 
establishing additional record-keeping requirements for mail-order 
sales, and requiring producers of Scheduled Listed Chemical Products to 
make annual estimates of the quantities of the products needed for 
legitimate use. These domestic regulatory requirements, coupled with 
the enforcement actions being taken by states should lead to a decline 
in the number of domestic operational clandestine laboratories. 
Limiting sales at the wholesale level is another important part of the 
equation. Under the law, foreign distributors are required to disclose 
all known information to the importer on the chain of distribution of 
such chemicals from the manufacturer to the importer. Furthermore, the 
State Department is required to identify annually the five largest 
exporting and importing countries of Scheduled Listed Chemical 
Products, and DEA is given the authority to issue importation 
prohibition orders. Taken together, these actions are expected to help 
greatly on the international regulatory side. Effective methamphetamine 
enforcement calls for a balanced approach that addresses the drug law 
enforcement issues, while ensuring the availability of an adequate 
supply of controlled substances to meet consumers' legitimate medical 
needs.
           despite the accomplishments, the challenges remain
    Madam Chairman, DEA carefully manages the resources Congress 
provides to ensure we wring every penny out of every dollar you give 
us. And while we are proud of our many accomplishments, we never lose 
sight of the fact that drug abuse remains a very serious problem facing 
our country. The most recent data available from the federal Centers 
for Disease Control and Prevention sadly reveals that in 2004, 30,711 
Americans died from drug abuse. This is almost 2,000 more deaths than 
occurred in 2003.
    Compounding the loss of lives is the damage from increased crime 
and violence, the powerful grip of addiction, lower productivity in the 
workforce, child abuse and neglect, environmental danger, and the grief 
of lost promise. Taken together, the effect of these human tragedies 
eclipses even the very tragic impact of terrorism. And so, while we 
realize our country faces tight budget times, we are here today to ask 
you to give us a few more tools, a few more resources, so we can do a 
little more to drive illegal drugs from our shores.
                    fiscal year 2008 budget request
    For fiscal year 2008, DEA is requesting $2.4 billion ($1.8 billion 
under the Salary and Expenses Account, $239 million under the Diversion 
Control Fee Account, and $389 million for OCDETF activities and other 
reimbursable agreements). A total of 10,239 positions, of which 4,811 
are Special Agent positions, are requested from these funding sources. 
This request represents an increase of $110 million over the fiscal 
year 2007 President's budget, and was developed with the goal of 
advancing DEA's enforcement strategy in the most efficient and 
effective manner. It was developed through a planning process of 
several months duration, calling upon the knowledge, talent, and skills 
of many DEA professionals with years of experience in drug law 
enforcement. Under the Salary and Expenses Account, the fiscal year 
2008 request would provide funding for three initiatives. Fee Account 
collections would fund companion initiatives in the diversion control 
program.
                     salaries and expenses account
    DEA is requesting $39.3 million to expand activities in three key 
areas:
Southwest Border and Methamphetamine Enforcement Initiative ($29.2 
        million and 8 positions)
    DEA is an active participant in the Southwest Border Initiative, a 
cooperative effort launched in 1994 by federal law enforcement agencies 
to combat the threat posed by Mexico-based trafficking groups operating 
along the Southwest border. The Southwest Border and Methamphetamine 
Enforcement Initiative that DEA is proposing would complement the 1994 
initiative in an area of the country recognized as the principal 
arrival zone for most illicit drugs smuggled into the United States, as 
well as the predominant staging area for the subsequent distribution of 
these drugs throughout the country. With regard to methamphetamine 
alone, current drug and lab seizure data suggests that approximately 80 
percent of the methamphetamine used in the United States originates 
from larger laboratories operated by Mexican-based organizations on 
both sides of the border. The data also suggests that the remaining 
approximately 20 percent consumed is produced in small toxic labs. 
DEA's Southwest Border and Methamphetamine Enforcement Initiative would 
help DEA step up the fight on both sides of the border through 
increases in our aviation assets, and improvements in our surveillance 
and communications systems and data collection and analysis 
capabilities.
    Some specifics.--$15.4 million would be used to purchase, among 
other things, three helicopters, each equipped with a High Definition 
camera for complex aerial surveillance activities in support of our 
major investigations. An additional $3.4 million would fund operational 
expenses and equipment purchases needed for providing communications 
coverage of remote areas along the border. Also requested is $3.4 
million and two positions to design, develop and implement an advanced 
digital imagery program for capturing and storing facial and other 
identifiable images for drug trafficking organizations investigations. 
To purchase advanced satellite telephone and maritime tracking devices, 
and sensor and audio/video surveillance equipment, which often act as a 
force multiplier, DEA is requesting a total of $5.1 million. The El 
Paso Intelligence Center (EPIC) developed Operation Gatekeeper to 
research, analyze, and report information on the Mexican drug 
trafficking organizations that control entry corridors along the 
border. To expand this important operation, DEA is requesting $612,000 
and six positions. And to expand its information sharing capabilities, 
EPIC is requesting $3.4 million to develop the capacity to share 
digital images with its Federal, State and local law enforcement 
partners.
Counterterrorism and Intelligence Sharing Initiative ($7.1 million and 
        7 positions)
    In 2006, after a 25-year hiatus, DEA's Office of National Security 
Intelligence (NN) was designated a member of the Intelligence Community 
(IC). While the designation does not grant new authorities to DEA, it 
does formalize the long-standing relationship between DEA and the IC 
and allows DEA and other IC members to work on issues of national 
security interest in an integrated fashion. With over 33 years of 
operational experience in the foreign arena and the largest U.S. law 
enforcement presence abroad, DEA has made and will continue to make 
many unique contributions, not only in drug law enforcement, but also 
in the interest of national security. For example, with over 5,000 
confidential sources, DEA possesses substantial human intelligence 
capabilities. Additionally, DEA conducts 67 percent of all federal 
domestic law enforcement wire taps.
    An Overview Of The United States Intelligence Community--2007, 
which was prepared by the Office of the Director of National 
Intelligence, states that ``DEA/NN's membership in the Community helps 
optimize the overall U.S. government counter narcotics interdiction and 
security effort and furthers creative collaboration between the many 
organizations involved in countering the threats from narcotics 
trafficking, human smuggling/trafficking, immigration crimes, and 
global terrorism.'' Furthermore, based on available intelligence, there 
is clear evidence that drug profits are being used to facilitate acts 
of terrorism and violence. These acts undermine democratic governance 
and respect for the rule of law, as well as destabilize regional 
security in countries such as Afghanistan, Colombia, Mexico, Venezuela, 
and the tri-border area.
    The DEA and the IC have a long history of collaborating for 
purposes of identifying and disrupting illegal drug trafficking. The 
Counterterrorism and Intelligence Sharing Initiative would bolster 
those collaborations, allow DEA to enhance its classified information 
technology (IT) infrastructure, provide start-up funding and positions 
for studying and analyzing emerging as well as established coca and 
opium poppy growing regions, and provide resources for DEA to continue 
its participation in Justice's anti-gang activities.
    Some specifics.--$6 million would ensure that DEA's classified IT 
backbone, MERLIN, would be upgraded in every DEA office every four 
years. Regularly scheduled upgrades would make certain that DEA's IC 
component has the secure communications infrastructure that is critical 
to communicating classified IC requests to both domestic and foreign 
DEA field offices. Presently, DEA is in a precarious situation as it 
relates to the continued viability of MERLIN. In previous years, 
requests for operations and maintenance enhancement funding have been 
denied; with the result that much of our MERLIN equipment is five or 
six years old and in danger of serious failure. If we are to meet our 
IC commitments and exploit our intelligence capabilities against 
transnational threats, DEA must have an infrastructure that makes that 
possible. Six positions and $950,000 are requested to study regions of 
the world where coca and poppy are grown to determine the amount of 
finished cocaine and heroin that can be produced from a given quantity 
of plant material. Finally, one position and $204,000 is requested so 
DEA may assign one Special Agent to the Department's National Gang 
Targeting, Enforcement, and Coordination Center, which takes part in 
and coordinates investigations and prosecutions, and develops 
enforcement and prevention strategies to combat gang violence in this 
country.
Online Investigations Initiative ($3 million)
    Drug traffickers are increasingly turning to the Internet to widen 
their reach and strengthen their criminal enterprises. State-of-the-art 
Internet investigative technologies are an essential tool if DEA is to 
attack the command and control communications of organizations, 
particularly those that operate across jurisdictional boundaries at the 
regional, national, and international levels. To achieve our 
objectives, DEA must acquire tailored Internet intercept solutions, 
arrange for permanent Internet connectivity between DEA's field 
divisions and the major Internet Service Providers, and purchase needed 
hardware for computer forensics purposes. With these purchases, DEA 
could greatly improve the quality, effectiveness, and timeliness of our 
investigations of these traffickers.
    Some specifics.--$1 million would be used to develop intercept 
solutions to counter traffickers who use Yahoo, Hotmail and other 
electronic mail accounts, as well as advanced Internet communications, 
wireless handheld devices, instant messaging services, and encrypted 
electronic mail. $1.5 million is requested to connect DEA field 
divisions to major Internet Service Providers by means of a secure, 
dedicated network. The total cost for these connections is $3 million, 
half of which is requested under the Salaries and Expenses Account and 
half would be covered by Diversion Control Fee Account to step up our 
investigations of illegal online pharmacies. Finally, DEA is requesting 
$520,000 to purchase computer hardware that is designed to aid forensic 
professionals with recovering and examining data more quickly and from 
numerous electronic devices.
Diversion and Control Fee Account (DCFA)
    DEA's fiscal year 2008 request includes $239 million under the 
DCFA, a $27.1 million increase over fiscal year 2007.
    Prescription drugs are diverted for abuse through doctors, 
pharmacies, thefts and robberies from manufacturers and distributors, 
and illegal Internet distributors. Throughout the United States, the 
non-medical use of prescription drugs continues at alarming rates. The 
2005 National Survey on Drug Use and Health, released in September 2006 
by SAMHSA, reports that an estimated 6.4 million Americans abuse 
prescription drugs, compared to 3.8 million in 2000--a 68 percent 
increase over five years. Furthermore, they are the second most abused 
type of drugs--behind only marijuana. Particularly troubling is the 
data showing that nearly one out of every ten high school seniors 
abuses dangerous painkillers. Fueling this increase is the 
proliferation of illicit websites that make it possible, with one 
simple click, to purchase controlled substances. Furthermore, buying a 
medicinal product through an illegal Internet pharmacy exposes 
individuals who make these purchases to serious health risks.
    DEA is actively pursuing those who divert pharmaceutical controlled 
substances. On the Internet and non-Internet sides combined, DEA 
initiated 1,840 criminal, complaint, and regulatory pharmaceutical 
investigations in fiscal year 2006. 857 of those investigations 
targeted Schedule III-V pharmaceutical controlled substances, and 237 
investigations targeted Schedule II pharmaceuticals. Between fiscal 
year 2004 and fiscal year 2006, DEA seized $55 million in cash, bank 
accounts, property, and computers in the course of its investigations, 
compared to $2.5 million in fiscal year 2003. While we are pleased with 
our progress, it is imperative that DEA enhance its enforcement work in 
an area that poses such an immediate public safety threat.
    Some specifics of our DCFA request.--DEA is requesting $766,000 and 
seven positions to provide much-needed investigative support for our 
computer forensics teams. We estimate that online diversion cases will 
increase the workload of DEA attorneys assigned to these cases by 75 
percent for the foreseeable future, and to prepare for this, DEA 
requests $495,000 and five attorney positions. DEA is requesting 
$337,000 and two positions (one Special Agent and one Diversion 
Investigator) to work with the Customs and Border Patrol in Long Beach, 
California to identify shipments of precursor chemicals from source 
countries that are destined for Mexico. Additionally, we are requesting 
$474,000 and one position (Foreign Diversion Investigator) to support 
existing DEA investigations in Panama City, Panama involving the 
smuggling of precursors moving through Panama. Finally, DEA has 
proposed that a new hybrid job series be established which contains the 
specialized diversion investigator requirements as well as full law 
enforcement authorities. The proposal, with an associated cost of $11.5 
million, is now under review by the Office of Personnel Management 
(OPM). Current employees who are interested and eligible may apply. 
Those who do not apply will continue to perform compliance functions. 
Through attrition, we will arrive at the appropriate number of 
diversion investigators to sustain the compliance function. With OPM 
approval of the proposal, DEA will begin the conversion in fiscal year 
2007.
Program Offsets
    Included in the President's budget is one funding offset proposal: 
the elimination of the MET program (Mobile Enforcement Teams). This 
offset would achieve savings of $20.6 million in fiscal year 2008.
    Over the years, DEA has valued each and every opportunity to 
support state and local law enforcement organizations as they combat 
drug-related violent crimes in our nation's cities and towns. 
Furthermore, as many of you know from experience in your own 
communities, our partnerships have yielded positive, and I hope, 
lasting results. At the same time, greater overall results are achieved 
when our focus is on targeting the drug trafficking organizations whose 
activities have the most significant impact on the drug problem in the 
United States as a whole.
    While DEA's field divisions will no longer deploy MET teams to 
local jurisdictions when we receive a deployment request, we will 
continue to provide law enforcement assistance to them whenever 
possible, including our vigorous training programs for state and local 
law enforcement officers. In fiscal year 2006, DEA trained more than 
41,000 officers. Also, during fiscal year 2006, DEA led over 200 State 
and Local Task Forces, with an on board strength of 1,600 Special 
Agents and 2,100 Task Force Officers.
                               conclusion
    In closing, let me reiterate that DEA works very hard to manage its 
resources and finances wisely and efficiently. Nevertheless, as our 
base budget has gradually eroded over time due to pay raise 
absorptions, rescissions and program reductions, we have been unable to 
maintain adequately our infrastructure or agent and support staffing at 
their previous levels. This has put us at an enforcement disadvantage. 
We must regain our financial footing. We must have the ability to 
sharpen and expand the enforcement tools and techniques that have 
helped us establish our drug enforcement leadership role. The budget 
before you today sets us on the path to regain that footing.
    Madam Chairman and Members of the Subcommittee let me assure you 
that although we are experiencing fiscal challenges, we at DEA never 
waver in our firm commitment to public service and public safety.
    This concludes my remarks. I would now be happy to answer any 
questions you or the other Members of the Committee may have.
    attachment--drug threats and enforcement challenges--april 2007
                   drug threats to the united states
Methamphetamine
    Methamphetamine is the most widely abused and most frequently 
clandestinely produced synthetic drug \1\ in the United States. 
Methamphetamine appeals to people across all genders, ages, and socio-
economic levels. Methamphetamine has a high rate of addiction, a low 
rate of sustained recovery, and is cheap to manufacture. It devastates 
users, their families, and local communities. According to the 2005 
National Survey on Drug Use and Health (NSDUH), 512,000 persons 12 and 
older used methamphetamine during the past 30 days (an eighteen percent 
decrease from 2003) and 1.3 million have used it in the past year, 
virtually the same number as in 2003. The estimated number of past year 
methamphetamine users is nearly three and one-half times the number of 
estimated past year heroin users. In fiscal year 2006, DEA domestic 
seizures of methamphetamine totaled 2.1 metric tons. Super lab seizures 
in the United States were reduced by 86 percent through increased 
enforcement efforts, from 244 in calendar year (CY) 2001 to 35 in CY 
2005. The total number of clandestine methamphetamine laboratories 
seized nationally also decreased, from 10,212 in CY 2003 (the highest 
total from 2001 to 2005) to 5,840 in CY 2005 (43 percent). Of the 2,134 
clandestine methamphetamine laboratories seized nationally so far in CY 
2006, only 17 are classified as ``super labs.'' Seizures of 
methamphetamine along the Southwest Border of the United States and 
Mexico have increased 129 percent, from 1,170 kilograms in CY 2001 to 
2,679 kilograms in CY 2005.
---------------------------------------------------------------------------
    \1\ The term ``synthetic drugs'' refers to controlled substances 
such as methamphetamine, MDMA ``ecstasy'' (and its analogues), GHB (and 
its analogues), ketamine, and other substances, which are not of 
primarily organic origin and are usually associated with clandestine 
manufacture.
---------------------------------------------------------------------------
    By effectively targeting and arresting the main suppliers of bulk 
precursor chemicals, DEA has successfully reduced the number of super 
labs \2\ in the United States. As a consequence, operators of super 
labs have shifted their production to Mexico. Current drug and lab 
seizure data suggests that approximately 80 percent of the 
methamphetamine used in the United States originates from larger 
laboratories operated by Mexican-based syndicates on both sides of the 
border, and that approximately 20 percent of the methamphetamine 
consumed comes from small toxic labs (STLs) in the United States. STLs 
generally are unaffiliated with major drug trafficking organizations, 
but nevertheless present enormous environmental challenges. In recent 
years, the proliferation of STLs has been fueled by the ready 
availability of pseudoephedrine, the key ingredient in methamphetamine 
and by the fact that the manufacturing process is simple, inexpensive, 
and recipes can be found easily on the Internet. Super lab seizures in 
the United States declined by 86 percent through increased enforcement 
efforts, from 244 in calendar year (CY) 2001 to 35 in CY 2005. The 
total number of clandestine methamphetamine laboratories seized 
nationally also decreased, from 10,212 in CY 2003 (the highest total 
from 2001 to 2005) to 5,840 in CY 2005 (43 percent). Of the 2,134 
clandestine methamphetamine laboratories seized nationally so far in CY 
2006, only 17 are classified as ``super labs.''
---------------------------------------------------------------------------
    \2\ ``Super labs'' are those labs that are capable of producing at 
least 10 pounds of methamphetamine per cycle.
---------------------------------------------------------------------------
    The most promising means of eliminating STLs is to cut off their 
supply of ephedrine and pseudoephedrine. DEA has removed a number of 
distributors of grey market drug products (those that can be purchased 
at truck stops, party/liquor stores, etc.) from the marketplace. 
Following DEA's success with removing grey market distributors, STLs 
have become heavily reliant on obtaining precursor chemicals from cold 
and asthma drug products (usually packaged in blister packs) from 
traditional retail outlets, such as chain drug stores. Based on 
clandestine lab seizure statistics, those states restricting the 
availability of methamphetamine precursor chemicals, like 
pseudoephedrine, have seen a dramatic decrease in the number of STLs. 
Implementing the Combat Methamphetamine Epidemic Act of 2005 will 
further help reduce the number of STLs as it makes pseudoephedrine and 
ephedrine more difficult to obtain.
    DEA Operational Highlight--August 2006.--DEA arrested 28 members of 
two separate cocaine trafficking organizations which were 
simultaneously distributing methamphetamine in Henderson and Caldwell 
Counties, North Carolina. The arrests concluded ten-month and 15-month 
Organized Crime and Drug Enforcement Task Force (OCDETF) investigations 
that resulted in the dismantlement of the Juan LOPEZ and the Lewis 
CASAS methamphetamine trafficking organizations. The two organizations 
were responsible for the distribution of five kilograms of 
methamphetamine per month in the western part of North Carolina. To 
date, these two OCDETF investigations have resulted in 47 arrests, 
including LOPEZ and CASAS, 37 repeat offenders, and the seizure of more 
than one kilogram of methamphetamine, approximately $50,000 U.S. 
currency, and six weapons.
    DEA Operational Highlight--May 2006.--DEA and the FBI arrested 27 
individuals, resulting in the dismantlement of two crystal 
methamphetamine trafficking organizations. During the past ten years, 
the Rafael RAMIREZ organization was responsible for the distribution of 
approximately 100 pounds of crystal methamphetamine on a monthly basis 
from Mexico to the San Francisco area. The RAMIREZ organization 
supplied methamphetamine to the Kasi POHAHAU organization which, during 
the past ten years, was responsible for the distribution of more than 
50 pounds of crystal methamphetamine from San Francisco to Hawaii. This 
three-year OCDETF investigation has resulted in the arrest of 37 
individuals, including RAMIREZ and POHAHAU, and the seizure of 42 
pounds of crystal methamphetamine, 52 kilograms of cocaine, and $1.4 
million in U.S. currency.
Non-medical use of prescription drugs
    Non-medical use of addictive prescription drugs has been increasing 
throughout the United States at alarming rates. In CY 2005, an 
estimated 6.4 million \3\ Americans age 12 and older reported past 
month use of prescription drugs for non-medical purposes compared to 
3.8 million in CY 2000 \4\--a 68 percent increase in 5 years. 
Nationally, the misuse of prescription drugs was second only to 
marijuana in CY 2005.
---------------------------------------------------------------------------
    \3\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. (2006). Results from the 
2005 National Survey on Drug Use and Health.
    \4\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. (2002). National Household 
Survey on Drug Abuse: Vol 1. Summary of National Findings.
---------------------------------------------------------------------------
    Individual users can easily acquire prescription drugs through a 
variety of means, generally dependent on the type of drug. DEA and 
other data sources reveal that OxyContin and other Schedule II drugs 
are most commonly obtained illegally through ``doctor shopping'' or are 
sold illegally by registrants (e.g., doctors/pharmacists). On the other 
hand, Schedule III and Schedule IV drugs (e.g., anti-anxiety 
medications, hydrocodone, and anabolic steroids) are often purchased 
through the Internet. Many of these pharmacies are foreign-based and 
expose the purchaser to potentially counterfeit, contaminated, or 
adulterated products.
    DEA targets its investigations on domestic Internet pharmacies 
using data from available data bases, such as the Automated Reporting 
of Completed Orders System (ARCOS), to determine which retail 
pharmacies are most likely involved in distribution of large quantities 
of controlled substances over the Internet. In fiscal year 2006, 14.7 
percent of investigative work hours dedicated to open diversion cases 
were Internet cases. This is an increase of 27.9 percent from fiscal 
year 2005 when Internet cases represented 11.3 percent of the 
investigative work hours dedicated to open diversion cases, and an 
increase of 50 percent from fiscal year 2004 when 8.8 percent of case 
work hours were for Internet cases.
    During fiscal year 2006, DEA has initiated over 218 investigations 
of online sales of controlled pharmaceuticals without a prescription. 
As a result of Internet investigations, DEA seized approximately $4.9 
million in cash, bank accounts, property, and computers during fiscal 
year 2006.
    In fiscal year 2004, DEA established a specialized section within 
its Special Operations Division (SOD) to coordinate multi-
jurisdictional Title III investigations involving the diversion of 
pharmaceuticals and chemicals over the Internet. During fiscal year 
2006, DEA has coordinated over 90 Internet investigations, resulting in 
the arrest of approximately 128 individuals and the seizure of 
approximately 14 million dosage units of controlled substances and 
approximately $52.6 million in U.S. currency.
    In 2006, DEA continued to enhance the Online Investigations Project 
(OIP), which improves DEA's ability to systematically identify, 
investigate, and prosecute the owners and operators of rogue pharmacies 
using the Internet to divert controlled substances. During fiscal year 
2006, the OIP Configuration Control Board authorized the release of 71 
change request items. These improvements made significant changes to 
the functionality of the OIP system, which enabled Diversion Staff 
Coordinators assigned to Intelligence to provide effective, ongoing 
support of significant Internet investigations. The system has also 
been utilized to provide pertinent Internet data in furtherance of 
ongoing Internet investigations in the field, as well as to provide new 
tips and leads. Since the inception of the OIP Web-Check process in 
March 2005, Web-Checks were performed on 2,425 web sites and e-mail 
addresses as a result of 455 requests.
    DEA Operational Highlight--January 2007.--DEA arrested four 
individuals, resulting in the dismantlement of the Andrew RUSSO 
internet pharmaceutical drug trafficking organization. The RUSSO 
organization used illicit internet websites to sell controlled 
substances directly to consumers without a physician's medical 
evaluation. From July to December 2005, the RUSSO organization 
distributed over one million tablets of alprazolam, and six million 
tablets of phentermine through its two internet pharmacies, United Care 
Pharmacy and Kwic-Fill. In addition to the arrests, this 20-month 
Priority Target Organization (PTO) investigation has resulted in the 
seizure of $2,000,415 in U.S. currency, 11 vehicles valued at $700,000, 
and the possible forfeiture of real estate valued at $1.5 million.
    DEA Operational Highlight--December 2006.--DEA arrested seven 
individuals, resulting in the dismantlement of the Antonio QUINONES 
internet pharmaceutical drug trafficking organization. The QUINONES 
organization used illicit internet websites to sell controlled 
substances directly to consumers without a physician's medical 
evaluation. During the past two years, the QUINONES organization 
shipped more than one million dosage units of Vicodin and amphetamines 
per month from Miami, Florida, to locations throughout the United 
States. In addition to the arrests, this one-year OCDETF investigation 
has resulted in the seizure of $935,000 in U.S. currency, real estate 
valued at $4.2 million, two vehicles valued at $350,000, a watercraft 
valued at $650,000, and two firearms. The DEA conducted this 
investigation with the Internal Revenue Service and the U.S. Marshals 
Service.
            Cocaine
    Cocaine remains a major illegal drug of concern throughout the 
United States based upon abuse indicators, violence associated with the 
trade, and trafficking volume. After marijuana, cocaine continues to be 
the most widely used illicit drug among all age categories. The 2005 
National Survey on Drug Use and Health (NSDUH) found that 2.4 million 
Americans used cocaine within the past 30 days and that over 5.5 
million Americans used it within the past year. According to the 2004 
Drug Abuse Warning Network (DAWN) report, cocaine is the most 
frequently reported illegal drug in hospital emergency room visits, 
accounting for 1 in 5 (19 percent) drug related emergency room visits 
in CY 2004.\5\
---------------------------------------------------------------------------
    \5\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. Detailed Emergency 
Department Tables from DAWN: 2004. April 2006.
---------------------------------------------------------------------------
    Although Colombia is the principal source of cocaine distributed in 
the United States, most of the wholesale cocaine distribution in the 
United States is controlled by Mexican drug trafficking organizations 
and criminal enterprises. Even in areas dominated by Colombian and 
Dominican drug trafficking organizations, such as the Northeast and 
Caribbean regions, the influence of Mexican drug trafficking 
organizations is increasing.
    DEA Operational Highlight--September 2006.--Consolidated Priority 
Organization Targets (CPOTs) Miguel and Gilberto RODRIGUEZ-OREJUELA 
pled guilty in U.S. District Court for the Southern District of Florida 
to conspiracy to import cocaine, and agreed to plead guilty in the 
Southern District of New York to conspiracy to commit money laundering. 
Each brother was sentenced to thirty years in prison. The brothers also 
agreed to the entry of a $2.1 billion judgment of forfeiture, and the 
forfeiture of 287 properties. Twenty-eight family members have also 
agreed to these forfeitures. The RODRIGUEZ-OREJUELA brothers ran the 
Cali Cartel in Colombia, and since 1990 imported and distributed more 
than 200,000 kilograms of cocaine from Colombia to the United States.
    DEA Operational Highlight--May 2006.--The Brazilian Federal Police 
arrested CPOT Pablo RAYO Montano in Sao Paulo, Brazil, and in an 
operation coordinated by DEA, law enforcement teams in four U.S. cities 
and five foreign countries arrested 52 individuals, resulting in the 
dismantlement of the RAYO Montano cocaine trafficking organization. 
RAYO Montano started in the narcotics business as a transporter in 
Buenaventura, Colombia approximately 20 years ago. In the last four 
years alone, the RAYO Montano organization has been responsible for the 
transportation of 15 tons of cocaine per month from South America to 
the United States and Europe. RAYO Montano has been linked to the 
notorious Norte del Valle Cartel, the Autodefensas Unidas de Colombia 
(AUC) paramilitary organization, the Fuerzas Armadas Revolucionarias de 
Colombia (FARC) terrorist organization, and corrupt high-level 
officials in the Colombian government. On February 22 and March 3, 
2006, federal grand juries in the District of Columbia and the Southern 
District of Florida, respectively, indicted RAYO Montano on money 
laundering and cocaine trafficking charges. The indictments were the 
result of Operation Twin Oceans, a three-year OCDETF investigation 
supported by the DEA Special Operations Division. Operation Twin Oceans 
has resulted in 138 arrests and the seizure of 47,550 kilograms of 
cocaine, 700 pounds of marijuana, ten kilograms of heroin, $1.6 million 
in U.S. currency, and other assets with a total estimated value of $47 
million, including three islands near the coast of Panama.
            Heroin
    The overall demand for heroin in the United States is lower than 
for other major drugs of abuse such as cocaine, marijuana, and 
methamphetamine.\6\ However, one cause for concern is the recent 
increase in heroin usage. According to the 2005 NSDUH, 379,000 people 
aged 12 and older reported using heroin during the past 30 days in CY 
2005; a slight decrease from 398,000 in CY 2004.\7\ Heroin remains 
readily available in major metropolitan areas and is the third most 
frequently mentioned illegal drug reported to DAWN by participating 
emergency departments after cocaine and marijuana, accounting for 
162,137 mentions in CY 2004.\8\
---------------------------------------------------------------------------
    \6\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. (2006). Results from the 
2005 National Survey on Drug Use and Health.
    \7\ Ibid.
    \8\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. Detailed Emergency 
Department Tables from DAWN: 2004. April 2006.
---------------------------------------------------------------------------
    Most of the heroin entering the United States is produced in South 
America and Mexico. Although heroin production in these areas has 
decreased in recent years, the production capacity remains sufficient 
to meet U.S. demand for the drug.\9\ In 2004, Afghanistan produced more 
than 90 percent of the world's heroin supply.\10\ However, Afghanistan 
is not currently a major heroin supplier to the United States; only 
about eight percent of the U.S. supply comes from that country. The 
majority of the heroin entering the United States is produced in 
Colombia and Mexico.
---------------------------------------------------------------------------
    \9\ U.S. Department of Justice, National Drug Intelligence Center. 
(2006). 2006 National Drug Threat Assessment.
    \10\ Ibid.
---------------------------------------------------------------------------
    DEA Operational Highlight--November 2006.--DEA arrested seven 
individuals, resulting in the dismantlement of the Shakur MUHAMMAD 
heroin trafficking organization. This organization distributed 
fentanyl-laced heroin, brand named ``Get High or Die Trying'' and 
``Burn Out,'' which was directly responsible for six deaths and 27 
overdoses. During the past two years, the MUHAMMAD organization 
distributed over three kilograms of heroin per month in the Pittsburgh, 
Pennsylvania area. This six-month OCDETF investigation has resulted in 
the arrest of nine individuals, including MUHAMMAD, and the seizure of 
one kilogram of heroin and two firearms.
    DEA Operational Highlight--June 2006.--DEA arrested 12 individuals 
in Las Vegas, Nevada, Palm Springs, California, Caguas, Puerto Rico, 
and New York City, resulting in the dismantlement of the Javier MONROY 
heroin trafficking organization. Since 2004, the MONROY organization 
has been responsible for importing more than 200 kilograms of heroin 
into the United States. MONROY is a former Bogota, Colombia police 
officer. The MONROY organization used couriers to smuggle heroin from 
several foreign countries, including Ecuador, Venezuela, Trinidad and 
Tobago, Colombia, Brazil, and Mexico, to New York for distribution. The 
organization employed more than a dozen drug couriers, many of whom 
made multiple drug trips and most of whom were based in the Las Vegas 
area. Typically, the drug couriers smuggled between three to five 
kilograms of heroin per trip concealed within the lining of clothes. To 
date, this ten-month OCDETF investigation has resulted in the arrest of 
22 individuals, including MONROY, and the seizure of 28 kilograms of 
heroin and $220,000 in U.S. currency.
            Marijuana
    Marijuana continues to be a significant threat. The 2005 NSDUH 
found that marijuana was the most commonly used illicit drug with 14.6 
million users (6.1 percent of the population 12 and older) during the 
past month in CY 2004--the same as in CY 2003.\11\ More teens seek 
treatment for marijuana dependency than for all other drugs combined 
including alcohol, and marijuana was involved in 215,665 emergency 
department visits \12\ in CY 2004, second only to cocaine among drug-
related visits.\13\
---------------------------------------------------------------------------
    \11\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. (2006). Results from the 
2005 National Survey on Drug Use and Health.
    \12\ A visit to the emergency room is referred to as an episode, 
and every time a drug is involved in an episode it is counted as a 
mention.
    \13\ U.S. Department of Health and Human Services, Substance Abuse 
and Mental Health Services Administration. Detailed Emergency 
Department Tables from DAWN: 2004. April 2006.
---------------------------------------------------------------------------
    Marijuana trafficking is prevalent across the nation, with both 
domestic and foreign sources of supply. The most recent supply 
availability estimates indicate that between 10,000 and 24,000 pure 
metric tons of marijuana are available in the United States,\14\ and 
that Americans spend more than $10.4 billion every year on 
marijuana.\15\ Since the demand for marijuana far exceeds that for any 
other illegal drug and the profit potential is so high, some cocaine 
and heroin drug trafficking organizations traffic marijuana to help 
finance their other drug operations.
---------------------------------------------------------------------------
    \14\ Drug Availability Steering Committee, Drug Availability 
Estimates in the United States, December 2002.
    \15\ Executive Office of the President, Office of National Drug 
Control Policy. What Americans Spend on Illegal Drugs 1988-1998. 
December 2000.
---------------------------------------------------------------------------
    Mexican drug trafficking organizations dominate the transportation 
and wholesale distribution of the majority of foreign-based marijuana 
available in the United States and cultivate marijuana on U.S. public 
lands throughout California. High grade marijuana from Canada, commonly 
referred to as ``BC Bud,'' is also available in every region of the 
United States.
    DEA Operational Highlight--December 2006.--DEA arrested two 
individuals, resulting in the dismantlement of the Shon SQUIRE 
marijuana trafficking organization. During the past 18 months, the 
SQUIRE organization distributed 300 pounds of marijuana per month 
through its store, the Local Patient Cooperative, which was granted a 
permit to operate as a medical dispensary by the city of Hayward, 
California. The store serviced 200 customers per day, purchasing 
marijuana at $4,000 per pound and selling it at $6,500 per pound, in 
various products and quantities, for a gross profit of $750,000 per 
month. In addition to the arrests, this one-year investigation resulted 
in the seizure of 725 marijuana plants, $2 million in U.S. currency, 
five luxury vehicles and five firearms.
    DEA Operational Highlight--September 2006.--DEA arrested 30 
individuals, resulting in the dismantlement of the Manuel CARO 
marijuana trafficking organization. During the past 18 months, the CARO 
organization distributed 1,000 pounds of marijuana per month in 
Florida, New Jersey and New York. To date, this six-month OCDETF 
investigation has resulted in the arrest of 60 individuals, including 
CARO, and the seizure of 4,000 pounds of marijuana, $170,000 in U.S. 
currency, and a large amount of sophisticated indoor hydroponic grow 
equipment. Additionally, sixty residential properties are being 
reviewed for possible forfeiture action.
Enforcement Challenges
            Transit Zones
    The Southwest Border area is the principal arrival zone for most 
illicit drugs smuggled into the United States. From that area, the 
smuggled drugs are distributed throughout the country.
    Most cocaine is transported from South America, particularly 
Colombia, through the Mexico-Central America Corridor via the Eastern 
Pacific transit zone (50 percent) and the Western Caribbean zone (40 
percent). Most of the cocaine transiting these two areas is ultimately 
smuggled into the country via the Southwest Border. The remaining 10 
percent of cocaine transported from South America mostly transits the 
Caribbean zones to Florida and the Gulf Coast.
    According to the 2006 National Drug Threat Assessment, 
methamphetamine seizures increased from 1.12 metric tons in CY 2002, to 
1.73 metric tons in CY 2003, to 1.98 metric tons in CY 2004. Most of 
the foreign-produced marijuana available in the United States is 
smuggled into the country from Mexico via the Southwest Border by 
Mexican drug trafficking organizations and criminal groups, as 
evidenced by CY 2004 seizures of 1,103 metric tons on the Southwest 
Border versus 9.2 metric tons on the Northern Border.
    In CY 2004, seizures for Southwest Border points of entry included 
22.4 metric tons of cocaine, 388 kilograms of heroin, 1,070 metric tons 
of marijuana, and 2.3 metric tons of methamphetamine. By comparison, 
seizures in the Florida/Caribbean arrival zone for the same time period 
included 10.5 metric tons of cocaine, 481 kilograms of heroin, 4.9 
metric tons of marijuana and no methamphetamine.
    DEA Operational Highlight--August 2005 through October 2005.--DEA 
oversaw Operation All Inclusive (OAI) 2005-1, the first initiative 
under the DEA-developed, multi-agency International Drug Flow 
Prevention Strategy. This strategy is designed to cause major 
disruption to the flow of drugs, money, and chemicals between source 
zones and the United States through the execution of joint enforcement 
operations that attack the main arteries and support infrastructure 
nodes of the drug trade. OAI 2005-1 focused on a predictive 
intelligence-based attack of the maritime, land, financial, and air 
smuggling vulnerabilities of drug trafficking organizations operating 
within the Mexico/Central America corridor. OAI 2005-1's success 
included nearly 47 metric tons of cocaine seized, which equates to 5 to 
10 percent of the estimated quantity of cocaine that was transported 
through the transit zones to the United States during all of 2005. 
Additionally, during the 65-day period of the operation, total cocaine 
seizures in the Mexico/Central American and Caribbean Corridors 
increased 119 percent compared to the 65-day period preceding the 
operation, from 36 metric tons to 79 metric tons. At the same time, 
cocaine seizures by DEA domestic offices decreased 29 percent compared 
to the 65-day period prior to the operation, from 31,789 kilograms to 
22,669 kilograms. Further, as a result of the operation, drug 
trafficking organizations were forced to delay or suspend their drug 
operations, divert their routes, change their modes of transportation, 
and jettison loads. Other results include 346 arrests and additional 
seizures of 88.56 kilograms of heroin, 26.28 metric tons of marijuana, 
990,200 tablets of pseudoephedrine, $16 million in currency, and 104 
weapons.
    DEA Operational Highlight--March 2006 through April 2006.--Building 
upon some of the lessons learned from OAI 2005-1, the second initiative 
under the highly effective International Drug Flow Prevention Strategy, 
OAI 2006-1, was conducted. OAI 2006-1 was comprised of a combination of 
staggered and simultaneous land, air, maritime, and financial attacks 
involving synchronized interagency counter drug operations designed to 
influence illicit trafficking patterns and increase disruptions of drug 
trafficking organizations. Some of the successes for OAI 2006-1 include 
over 130 arrests and the seizure of 43.77 metric tons of cocaine; 19.65 
metric tons of marijuana; 83.6 kilograms of heroin; 92.6 metric tons of 
precursor chemicals; and $4,079,894 U.S. currency. During the course of 
both OAI initiatives, DEA was able to determine through intelligence 
sources that traffickers postponed or canceled their operations, 
modified their methods of conveyance, varied smuggling routes, and 
jettisoned loads as a result of enforcement efforts.
            Gangs
    Gangs have become an increasing and pervasive threat to our 
nation's security and the safety of our communities. Seventy-five 
percent of the United States Attorneys report that parts of their 
districts currently have a moderate or significant gang problem. Gangs 
commonly use drug trafficking as a means to finance their criminal 
activities. Furthermore, many have evolved from turf-oriented entities 
to profit-driven, organized criminal enterprises whose activities 
include not only retail drug distribution but also other aspects of the 
trade, including smuggling, transportation and wholesale distribution.
    Criminal street gangs, outlaw motorcycle gangs, and prison gangs 
are the primary retail distributors of illegal drugs on the streets of 
the United States and the threat of these gangs is magnified by the 
high level of violence associated with their attempts to control and 
expand drug distribution operations. Gangs primarily transport and 
distribute cocaine, heroin, marijuana, and methamphetamine. Authorities 
throughout the country report that gangs are responsible for most of 
the serious violent crime in the major cities of the United States.
    DEA is committed to combating the gang problem within the United 
States. The agency targets gang drug trafficking activity through 
participation in a number of anti-gang initiatives with other law 
enforcement components, such as Violent Crime Impact Teams, Project 
Safe Neighborhoods, Weed and Seed Program, Safe Streets and Safe Trails 
Task Forces and the Attorney General's Anti-Gang Coordination 
Committee. In 2006, DEA targeted violent drug gangs, such as the Hell's 
Angels, Latin Kings, Bloods, Gangster Disciples, and Crips. Through 
state and local partnerships, DEA is able to target violent drug 
trafficking organizations in areas where state, local, and tribal law 
enforcement is challenged. In fiscal year 2006, DEA initiated 31 
deployments to state and local jurisdictions. Of these, nine (29 
percent) were gang related. Additionally, 6 percent (117) of DEA's 
total active PTO investigations (2,113) were gang-involved. There was a 
36 percent increase in active PTO cases involving gangs (from 86 in 
fiscal year 2005 to 117 in fiscal year 2006); 57 percent increase in 
cases initiated (from 56 in fiscal year 2005 to 88 in fiscal year 
2006); 120 percent increase in PTOs disrupted (from 10 in fiscal year 
2005 to 22 in fiscal year 2006); and 57 percent increase in PTOs 
dismantled (from 23 in fiscal year 2005 to 36 in fiscal year 2006).
    DEA Operational Highlight--February 2007.--DEA arrested 47 
individuals, resulting in the disruption of the Laton Spurgeon crack 
cocaine and heroin trafficking organization. Since August 2005, the 
Spurgeon organization distributed one kilogram of crack cocaine and six 
ounces of heroin per month at the Hamel Housing Projects, a New York 
City Housing Authority complex in Queens, New York. Sixteen of the 
defendants were charged with at least one count of selling drugs within 
a drug-free school zone. In addition to the arrests, this four-month 
PTO investigation resulted in the seizure of two firearms.
    DEA Operational Highlight--May 2006.--DEA arrested 23 individuals, 
resulting in the dismantlement of the Winfred Lorenzo HUNT and Carlton 
POTTS crack cocaine trafficking organization. During the past three 
years, the HUNT/POTTS organization was responsible for the distribution 
of 8-12 kilograms of cocaine per month in Palm Beach County, Florida. 
HUNT has been arrested 27 times previously and charged with several 
violent crimes, including attempted murder. POTTS' record includes 30 
prior arrests on charges such as battery on a police officer, 
aggravated assault, and attempted murder. Among those arrested was an 
employee of the Palm Beach State Attorney's Office who utilized her 
position to provide law enforcement information to the HUNT/POTTS 
organization. To date, this 15-month OCDETF investigation has resulted 
in the arrest of 53 individuals, including HUNT and POTTS, and the 
seizure of more than one kilogram of crack cocaine and two kilograms of 
powder cocaine, $172,000 in U.S. currency, and eight handguns.

                     United States Marshals Service

STATEMENT OF JOHN F. CLARK, DIRECTOR
    Mr. Clark. Thank you Madam Chairman, Ranking Member Shelby, 
and members of the subcommittee. As a career deputy U.S. 
marshal, I consider it a privilege and an honor to serve as the 
ninth Director of America's oldest law enforcement agency.
    We appreciate your support of the Marshals Service and our 
programs and, thanks to the funding you have provided over the 
years together with the work of the dedicated men and women of 
the Marshals Service, we have made a significant impact on 
reducing violent crime, protecting the judiciary, and securing 
thousands of prisoners who are in our custody.
    Our fiscal year 2008 budget request addresses the Marshals 
Services' highest priority needs. In total, we are requesting 
140 additional positions and just over $25 million. These 
resources will be used to maintain the security of our judicial 
system, to handle the increased court and prisoner workload in 
the Southwest border region, and to make our streets safer for 
children.
    Protection of the judicial process remains the primary 
mission of the United States Marshals Service and deputy 
marshals protect over 2,000 Federal judges, over 5,000 U.S. and 
assistant U.S. attorneys, and many Federal employees who work 
within our courthouses. Last year, the Marshals Service safely 
handled over 200 personal protection details for Federal judges 
and Supreme Court justices and investigated more than 1,100 
judicial threats.
    However, in recent times, we have seen very violent acts 
committed against the judiciary, some resulting in death. Just 
last month a suspect pled guilty to mailing an actual explosive 
device to the courthouse in Richmond, Virginia. It was court 
security officers who discovered and dealt with both the 
explosive device and its contents, a powdery substance labeled 
as anthrax.
    Also last month, a Houston man began making numerous 
telephone calls to the chambers of a Federal judge. The man 
would not accept that his case had been dismissed and became 
angry and threatening toward the judge. After fully 
investigating the situation, deputy U.S. marshals and local 
police determined the man was a danger to himself and others. 
He was brought before a magistrate judge and, through 
psychiatric evaluation, was ordered help.
    In the last 10 years, the number of reported threats has 
increased 553 percent. To strengthen our ability to analyze and 
investigate threats against the judiciary and to adequately 
provide judicial and courtroom security, we're requesting 16 
positions and $5.3 million. The Marshals Service must maintain 
a secure courtroom environment especially when trials involve 
high profile and high threat defendants.
    Right now, there are 20 high threat trials going on in 
courtrooms throughout the country, involving defendants such as 
the Aryan Brotherhood, the Russian mafia, and the MS-13 gang. 
Last year, the Marshals Service provided security for over 130 
high threat trials. In order to continue to provide security at 
the increased number of high threat trials, the Marshals 
Service requests 17 positions and $5.1 million.
    Every day, our Southwest border districts try to determine 
how to best use our limited number of deputy marshals to 
successfully protect the Federal judiciary and safely transport 
the detainees. The average daily prisoner population at 
districts along the Southwest border has increased 78 percent 
from fiscal year 2000 to fiscal year 2006. To address this 
prisoner increase, the Marshals Service requests 53 positions 
and $7.5 million for our Southwest border district offices.
    The Marshals Service workload has also increased due to our 
newest enforcement mission. Last July, the President signed 
into law the Adam Walsh Child Protection and Safety Act which 
places the Marshals Service as the lead Federal law enforcement 
agency responsible for investigating sex offender registration 
violations. There are more than 500,000 registered sex 
offenders in the United States and estimates indicate that 
there are at least 100,000 unregistered or noncompliant sex 
offenders.
    We are requesting 54 positions and $7.8 million to more 
aggressively investigate violations of the Adam Walsh Act. With 
the requested resources, we'll also be able to partner with the 
National Center for Missing and Exploited Children at their 
national sex offender targeting center.

                           PREPARED STATEMENT

    Madam Chairman, Senator Shelby, and members of the 
subcommittee, I look forward to working with your subcommittee 
throughout the appropriation process and on behalf of the men 
and women of the United States Marshals Service, I thank you 
for your ongoing support and I'd be happy to answer any 
questions you have now. Thank you.
    [The statement follows:]
                Prepared Statement of Hon. John F. Clark
    Madam Chairman, Senator Shelby, and Members of the Subcommittee, I 
appreciate the opportunity to appear before you today to discuss the 
President's fiscal year 2008 budget request for the United States 
Marshals Service (USMS). As a career Deputy U.S. Marshal, and the 
former United States Marshal for the Eastern District of Virginia, it 
is a very great honor to represent the Marshals Service as its 
Director.
    I appreciate this Subcommittee's support for the Marshals Service 
and our programs. Thanks to the funding that you have provided over the 
years, and with the good work of the dedicated men and women who wear 
``America's Star,'' we are performing our missions with excellent 
results.
           the mission of the united states marshals service
    As you know, the primary mission of the Marshals Service is the 
protection of the federal judicial process. The nation relies on us to 
provide physical security to federal judges and U.S. courthouses; to 
protect witnesses, jurors, and members of the public; to safely and 
humanely transport and detain federal prisoners; and to catch violent 
fugitives. Our missions are diverse, and the challenges we face are 
significant. Our accomplishments are many, and I welcome the 
opportunity to share some of those accomplishments with you today.
              summary of fiscal year 2006 accomplishments
    In fiscal year 2006, the Marshals Service:
  --Investigated more than 1,100 threats and inappropriate 
        communications to the federal judiciary and others for whom the 
        USMS has protective responsibility;
  --Provided more than 230 Personal Protection Details for federal 
        judges and prosecutors under threat, as well as security for 
        nearly 200 federal judicial conferences around the country, all 
        without incident;
  --Completed home intrusion alarm surveys and pre-installation plans 
        for more than 1,600 federal judges who requested an alarm 
        system, with more than 90 percent of those installations now 
        complete;
  --Cleared more than 39,000 federal felony fugitive cases and more 
        than 55,000 state and local fugitive cases;
  --Established and began operating our sixth Regional Fugitive Task 
        Force (RFTF), located in the Gulf Coast states of Alabama and 
        Mississippi; since its inception in July 2006, the Gulf Coast 
        RFTF has made more than 2,140 arrests;
  --Conducted two successful Fugitive Safe Surrender operations, 
        resulting in the surrender of more than 2,150 individuals 
        wanted on outstanding warrants;
  --Established the Sex Offender Apprehension Program and Sex Offender 
        Investigations Branch to manage the implementation of the Adam 
        Walsh Child Protection and Safety Act and support the Attorney 
        General's ``Project Safe Childhood'' initiative;
  --Completed 685 international extraditions from a record 67 foreign 
        countries;
  --Safely handled security operations for 135 high-threat trials 
        nationwide, including the trial of convicted terrorist Zacarias 
        Moussaoui;
  --Received more than 263,000 prisoners into our custody, with a daily 
        average prisoner population of nearly 56,000;
  --Safely and securely produced an average of 3,000 prisoners every 
        day for court appearances;
  --Moved an average of 1,200 prisoners each day through the Justice 
        Prisoner and Alien Transportation System (JPATS);
  --Protected more than 17,000 witnesses and their families through the 
        Witness Security Program;
  --Hosted the first International Witness Security Symposium, with 17 
        countries participating;
  --Assigned Special Operations Group (SOG) Deputies to Iraq to secure 
        the Saddam Hussein trial, assist in other high-threat trials, 
        and provide court security training;
  --Deployed SOG Deputies to Kabul, Afghanistan, providing Judicial and 
        Witness Security training for the Counter-Narcotics Police of 
        Afghanistan, supporting the international effort to combat drug 
        trafficking, narcoterrorism, and related crimes;
  --Managed more than $1.3 billion worth of seized assets through the 
        Asset Forfeiture Program;
  --Disbursed more than $300 million worth of assets with state and 
        local law enforcement agencies through the USMS Equitable 
        Sharing program; and
  --Received and disposed of more than 17,000 seized assets.
                    fiscal year 2008 budget request
    For fiscal year 2008, the Marshals Service requests a total of 
4,486 positions, including 3,299 Deputy Marshals, and $899.875 million 
to fulfill its missions. Of this amount, 140 positions and $25.7 
million are program enhancements to address critical needs related to 
judicial threat intelligence and investigations; high-threat trial 
security; enforcement of the Adam Walsh Child Protection and Safety 
Act; and handling the increased workload in our Southwest Border 
district offices.
            judicial threat intelligence and investigations
    Protection of the judicial process--with a heavy emphasis on 
judicial security--remains the primary mission of the USMS. 
Regrettably, the attitude of a small segment of American citizens 
toward the judicial process has changed, as is evidenced by an 
increasing number of threats to federal judges throughout the country. 
As a result, the workload associated with both judicial and courthouse 
security has significantly increased in the last six years. This is 
due, in part, to the judicial families' heightened awareness of 
potential threats, which has resulted in an increase in reporting of 
such incidents to the USMS. We cannot forget what happened in March 
2005, when the mother and husband of U.S. District Judge Joan Humphrey 
Lefkow were brutally murdered in retaliation for her rulings. The 
tragic loss clearly illustrates why there is a real and continuing need 
to monitor and enhance security for all involved in the judicial 
process.
    Just last month, a Houston man began making numerous telephone 
calls to the chambers of a federal judge. The man would not accept that 
his case had been dismissed, and became angry and threatening towards 
the judge. After fully investigating the incident, Deputy U.S. Marshals 
and local police determined that the man was a danger to himself and 
others. He was brought before a magistrate judge on charges of 
threatening the federal judge and a thorough psychiatric evaluation was 
ordered.
    Potential threats against judicial participants are not always 
obvious. Because of this, Deputy Marshals must be constantly vigilant. 
Threats come not only from detainees in custody, but also from 
litigants in civil matters, members of the general public attending 
trials, and individuals related to or associated with litigants or 
trial participants. In the last ten years, the number of reported 
threats has increased 553 percent. In fiscal year 2006, the number of 
threat investigations undertaken by our Judicial Security Division 
increased 17 percent over 2005. As a result, we are making adjustments 
to our threat assessment capability to respond to this new reality.
    To strengthen our ability to analyze and investigate threats 
against the judiciary and to adequately provide judicial and courtroom 
security, we are requesting 16 positions and $5.3 million. The 
requested resources will allow the Marshals Service to hire 10 
additional Deputy Marshals to serve as District Threat Investigators, 
and five Deputy Marshals and one analyst to be assigned to the 
Technical Operations Group (TOG) to support judicial security. The 
requested funding also will allow for enhancements to our secure voice 
and data communications abilities.
    I am steadfast in my commitment to fulfill our primary mission: 
protecting the federal judiciary. I am pleased to report the Marshals 
Service has taken aggressive steps to further protect courthouses and 
secure courtrooms in order to increase our threat intelligence and 
analysis capabilities. In 2004, we established the Office of Protective 
Intelligence (OPI) to facilitate the day-to-day sharing of threat 
intelligence information with federal, state, and local law enforcement 
agencies. As a result of funds provided by Congress in the fiscal year 
2005 Emergency Supplemental Appropriations Act for Defense, the Global 
War on Terror, and Tsunami Relief, we hired 10 new Deputy Marshals and 
three intelligence research specialists to provide 24-hours-a-day/7-
days-a-week threat response capability and to analyze and investigate 
all threats to the federal judiciary and others we protect. We 
appreciate the continuing support the Subcommittee provides us in 
fulfilling this crucial mission.
    In fiscal year 2006, the Marshals Service investigated more than 
1,100 judicial threats, staffed more than 230 Personal Protection 
Details, and provided security for nearly 200 judicial conferences. The 
year ended without a single violent incident.
    Deputy Marshals protect more than 2,000 federal judges, but we also 
protect Supreme Court Justices when they travel outside of the 
Washington, DC area. Highly-publicized confirmation hearings and 
controversial decisions have increased the visibility of these 
justices, and staged protests at both private and public functions have 
increased the demand for USMS protective details. We experienced an 80 
percent increase in the number of Supreme Court Justice Protective 
Details in fiscal year 2006 over the previous year. The Marshals 
Service is in the final stages of constructing our Threat Management 
Center, which will function as the nerve center for threats and 
inappropriate communications against judicial officials and other 
Marshals Service protectees. In addition, during fiscal year 2007, we 
plan to establish the National Center for Judicial Security (NCJS). The 
NCJS will provide a wide range of services and support to federal, 
state, local, and international jurisdictions as they seek advice and 
assistance on questions of judicial security. The Center will initiate 
programs and activities directly related to threat assessment, 
training, information sharing, and technology review.
    Outside of the courtroom, the Marshals Service has made tremendous 
progress in achieving the offsite security initiative funded through 
the fiscal year 2005 Emergency Supplemental Appropriations Act for 
Defense, the Global War on Terror, and Tsunami Relief. We are grateful 
for the support provided by Congress. Through the end of 2006, 1,616 
federal judges had requested or expressed interest in having a home 
intrusion alarm system installed in their residence. Working in 
conjunction with the Administrative Office of the U.S. Courts (AOUSC), 
the Marshals Service has scheduled or completed Pre-Installation Plan 
surveys for all of those residences. Installation has been completed in 
over 90 percent of these locations. The ongoing cost of these systems 
has been funded through the enacted fiscal year 2007 Joint Resolution.
    We have stepped up our training efforts. In fiscal year 2006, the 
Marshals Service conducted training in behavioral methodologies of 
investigation for 190 Deputy Marshals and Judicial Security Inspectors 
(JSIs) at the Federal Law Enforcement Training Center (FLETC) at 
Glynco, Georgia. A Judicial Protective Training Conference for 210 
Deputy Marshals and JSIs also was held in Baltimore, Maryland. These 
training seminars were led by experts from within the Marshals Service, 
as well as the United States Secret Service; the United States 
Attorneys' Office; the Diplomatic Security Service; the Bureau of 
Alcohol, Tobacco, Firearms and Explosives; and the Federal Bureau of 
Investigation.
    I am pleased to say that we are also taking a more aggressive 
approach to training Court Security Officers (CSOs) and exploring new 
screening technologies that CSOs can use in their efforts to secure 
federal courthouses. The CSO Orientation Curriculum has been completely 
updated, and training which formerly occurred on an annual basis is now 
being conducted quarterly at FLETC. Hands-on training is being 
conducted on new and current screening equipment, with added emphasis 
on detecting disguised weapons and explosives, and on response plans 
for dealing with weapons of mass destruction. Additionally, selected 
judicial districts are being asked to test next generation 
technologies, and the data obtained from these tests will assist the 
Marshals Service to select and procure the best possible screening 
equipment to support our judicial protection mission.
                       high-threat trial security
    The Marshals Service also has an obligation to ensure that the 
highest level of security is provided at U.S. courthouses during trials 
involving high-profile and high-threat defendants. High-threat trials 
generally involve international or domestic terrorists, drug kingpins, 
violent gang members, organized crime figures, or defendants in civil 
matters with a high degree of notoriety. An increasing number of these 
trials require enhanced security efforts to secure trial participants 
from internal and external threats, such as additional personnel, use 
of armored vehicles, and establishment of security perimeters around 
courthouses.
    Due to the potential for additional terrorist attacks, threats from 
extremist groups, intense media attention, the general public's 
concerns, and global interest in these proceedings, high-security, 
high-profile events require extensive operational planning and support 
from specially-trained and equipped personnel. The complexity of the 
operations and threat levels associated with these cases require 
additional Deputy Marshals for all aspects of USMS work. In order to 
continue providing the best security for the number of high-threat 
trials that we must handle, the Marshals Service requests 17 positions, 
including 15 Deputy Marshals, and $5.1 million for cellblock security 
enhancements, Supreme Court Protective Details, and our nationwide 
security maintenance contract.
    As the former U.S. Marshal in the Eastern District of Virginia, I 
can speak firsthand about the planning and resource requirements 
necessary to prepare for a high-threat trial. In fiscal year 2006, the 
extended legal proceedings involving terrorist Zacarias Moussaoui came 
to a close. The USMS provided security for this high-profile trial from 
2002 to 2006. Assisted by our Special Operations Group, we were 
successful in producing the defendant safely and securing the judicial 
proceedings without incident. In May 2006, Moussaoui was sentenced to 
life in prison, and on May 13, 2006, the Marshals Service transported 
him to Florence, Colorado, to begin serving his sentence at the United 
States Penitentiary Florence Administrative Maximum Facility.
    While Moussaoui is perhaps the most visible terrorist to be tried 
on U.S. soil, he will not be the last. The trial of terrorist suspect 
Jose Padilla in Miami, Florida, is just another case that will test the 
resources and resolve of the USMS. Preparations include evaluating 
logistical requirements such as: increasing perimeter security, setting 
up additional barricades, coordinating with local authorities to close 
street traffic, arranging armored motorcades for prisoner transport, 
upgrading surveillance cameras, and providing additional personnel 
through several rotations of specially-trained Deputy Marshals.
    The increase in gang-related trials also presents many challenges 
for the Marshals Service. For example, in Santa Ana, California, we 
have been securing the largest capital murder case in U.S. history. 
Forty defendants affiliated with the Aryan Brotherhood have been 
charged with a variety of violent crimes, including conspiracy to 
commit murder and drug trafficking. Not only were the defendants part 
of this gang, but so were many of the witnesses and trial observers in 
the public area of the courtroom. In July 2006, the jury convicted two 
Aryan Brotherhood leaders on a host of racketeering and murder charges. 
Both leaders were sentenced to life in prison without parole. Although 
federal prosecutors continue to achieve record convictions, out of the 
40 defendants, 14 are still pending trial and remain in our custody.
    Additional gang-related trials are currently taking place in 
Greenbelt, Maryland, where several very significant prosecutions that 
involve multi-defendant, high-threat trials of members of the notorious 
MS-13 gang are underway. The defendants were charged with a variety of 
offenses, including conspiracy, RICO, murder, carjacking, kidnapping, 
firearms violations and weapon charges. Many of the defendants also 
have been charged by U.S. Immigration and Customs Enforcement (ICE) for 
being in the United States illegally. These defendants are more violent 
than our average prisoner and require extra security when transporting 
and producing them for trial and various hearings. One trial involving 
seven defendants has already been completed and the second trial is 
currently in progress. The trials are scheduled to continue throughout 
2008, and additional arrests are expected as the investigations 
continue.
    Aside from the potential threats within the courtrooms when high-
threat trials are underway, the increase in gang-related prosecutions 
and the growing number of gang members in federal detention place 
additional burdens on the Marshals Service. In many instances, we must 
not only separate co-defendants from one another, but we must also 
segregate prisoners within the courthouse cellblock due to their 
history of violence, potential violence with other detainees, or risk 
of escape. Support for the President's budget request in this area will 
assist in our ability to meet these additional responsibilities.
    High-threat trials provide special challenges for the Marshals 
Service. However, our Deputy Marshals are hard at work every day in 
every judicial district handling prisoners for court appearances. 
Agency-wide in fiscal year 2006, our personnel produced prisoners for 
642,000 court proceedings. I am proud to say that these productions 
were completed without any injury to a judge, witness, or prosecutor.
               adam walsh child protection and safety act
    I am personally honored that last July, Congress named the Marshals 
Service as the lead agency to investigate sex offender registration 
violations. This important new enforcement role, outlined in the Adam 
Walsh Child Protection and Safety Act, grants us the authority to 
protect the most innocent among us--young children. Signed into law on 
July 27, 2006, the Adam Walsh Act is landmark legislation that will not 
only change the face of our communities by making them safer for 
vulnerable women and children, but it will also, in many respects, 
change the face of the Marshals Service.
    The Marshals Service has three distinct missions pursuant to the 
Adam Walsh Act: to assist state, local, and tribal jurisdictions in the 
location and apprehension of noncompliant sex-offenders; to investigate 
violations of non-compliance; and to assist in the identification and 
location of sex offenders relocated as a result of a major disaster.
    To carry out these new missions, we established the Sex Offender 
Apprehension Program and designated a program management office (the 
Sex Offender Investigations Branch) to direct and coordinate the 
implementation of the Act within the agency. The Marshals Service also 
designated sex offender investigations coordinators in each district 
office and Regional Fugitive Task Force to establish and maintain 
effective contacts with sex offender registration authorities, 
corrections officials, and other law enforcement agencies throughout 
the country. Last month, we trained 52 of these coordinators at the 
National Center for Missing and Exploited Children (NCMEC). There are 
three additional courses scheduled for this fiscal year, which will 
bring the total number of Deputy Marshals specially trained in sex 
offender investigations to approximately 200. To date the Marshals 
Service has opened 149 cases on convicted sex offenders for violations 
of the Act and we are participating in the Attorney General's ``Project 
Safe Childhood'' initiative.
    I am proud to say that the Marshals Service has a long-standing and 
mutually supportive relationship with NCMEC, which has been enhanced by 
the enactment of the Adam Walsh Act. One Deputy Marshal has been 
assigned full-time to NCMEC as a liaison to our Investigative Services 
Division, and this year we will be assisting NCMEC with their media 
campaign to encourage compliance with sex offender registration laws. 
In fiscal year 2008, pending the availability of resources, NCMEC and 
the USMS also will establish a National Sex Offender Targeting Center 
(NSOTC) to assist in identifying and prioritizing non-compliant sex 
offenders and to provide analytical support to federal, state, and 
local law enforcement agencies.
    Full implementation and enforcement of all provisions contained 
within the Act will require additional resources. Therefore, the 
Marshals Service requests 54 positions, including 43 Deputy Marshals, 
and $7.8 million to begin staffing areas of the country having large 
numbers of non-compliant sex offenders and to staff the NSOTC in 
partnership with NCMEC.
    It is estimated that there are nearly 600,000 registered sex 
offenders in the nation and as many as 100,000 non-compliant sex 
offenders. The requested resources will allow the Marshals Service to 
identify and apprehend non-compliant sex offenders--especially those 
who commit offenses against children--and to provide analytical support 
to federal, state, and local law enforcement agencies.
                      southwest border enforcement
    With the recent investment of resources to increase illegal 
immigrant apprehension along the Southwest Border, the Marshals Service 
is facing the daily challenge of utilizing our limited number of 
personnel to successfully protect and secure judicial personnel and 
federal detainees, and to safely transport those detainees. To 
alleviate this problem, the Marshals Service requests 53 positions, 
including 40 Deputy Marshals, and $7.5 million for Southwest Border 
(SWB) district offices.
    The prisoner population levels along the United States' Southwest 
Border have been an area of particular concern to the USMS since 1994, 
the start of intensified immigration initiatives in that region. The 
addition of thousands of agents from both ICE and U.S. Customs and 
Border Protection (CBP), together with increased enforcement of 
immigration laws by federal prosecutors, has caused another significant 
increase in the number of illegal immigrants captured and detained 
along the Southwest Border, further contributing to increases in the 
prisoner population. The average daily prisoner population in Southwest 
Border districts has increased by 78 percent from 2000 to 2006 and 
there are no signs of this upward trend abating. For example, the Del 
Rio office in the Western District of Texas is now handling an average 
of 400 prisoners a day.
    The CBP's fiscal year 2008 budget request includes funding to hire 
an additional 3,000 agents which, if approved by Congress, will 
drastically increase the Marshals Service workload. Without the 
resources requested in the President's budget, the USMS will have 
difficulty managing this increased prisoner population and the prisoner 
productions that will be required. When additional Border Patrol agents 
or border enforcement resources are added, the potential exists for 
creating massive criminal prosecutions in Southwest Border judicial 
districts. Additional Marshals Service resources, including Deputy 
Marshals and administrative positions to handle the resulting criminal 
workload, will be required to meet the growing burden.
    Statistics from the Drug Enforcement Administration demonstrate 
that drug-trafficking and drug-related gang activity along the 
Southwest Border is increasing, which also affects the USMS workload. 
The Marshals Service is handling prisoner productions for high-profile 
prosecutions such as trials involving the Arrellano-Felix drug cartel 
and the ``Mexican Mafia'' in Southern California. As a result of 
stepped-up enforcement and greater cooperation from the Mexican 
government in returning these individuals for prosecution in the United 
States, the USMS will continue to play a large role in these 
proceedings.
                        fugitive investigations
    The United States Marshals Service is the federal government's 
primary agency for conducting fugitive investigations. In fiscal year 
2006, more than 39,000 federal fugitive felons were apprehended through 
USMS-led task forces and warrant squads. Working with authorities at 
the state and local levels, USMS-led fugitive task forces also arrested 
more than 55,000 state and local fugitives. The ``force-multiplier'' 
effect of the Marshals Service's network of six regional and 85 
district-based task forces provides results that are unmatched in law 
enforcement. In all, more than 135,000 federal, state, and local 
fugitives were apprehended by the USMS and its law enforcement partners 
during fiscal year 2006.
    The Marshals Service has responded to requests from the State 
Department and the Department of Justice to provide specialized 
fugitive investigative training to foreign law enforcement agencies. In 
fiscal year 2006, the USMS conducted seven training missions involving 
170 foreign police officials from ten countries. These training 
missions included courses that ranged in content from basic prisoner 
handling to advanced electronic and financial surveillance techniques. 
Since fiscal year 1999, the USMS has trained more than 400 foreign 
officers from 22 countries in fugitive investigation.
    The Marshals Service continues to improve strategies used to 
apprehend fugitives. In October 2006, we teamed with our state, local, 
and federal colleagues in the largest national round-up focused on 
violent sex offenders and gang members. Operation FALCON III (Federal 
and Local Cops Organized Nationally) resulted in the apprehension of 
more than 10,700 fugitives, including 1,629 sex offenders and 364 
documented gang members. Teamwork was the key during this seven-day 
initiative. More than 1,060 agencies participated, with an average of 
3,000 law enforcement officers working each day in Marshals Service 
districts primarily east of the Mississippi River. By removing some of 
the country's most dangerous sex offenders and gang members from the 
streets, Operation FALCON III made America's communities safer and 
contributed to the Attorney General's ``Project Safe Childhood'' 
initiative. The operation also resulted in the safe recovery of a 
missing child, the arrest of a convicted sex offender who was 
babysitting three young children at the time of his arrest, and the 
seizure of child pornography.
    This success followed an earlier initiative, Operation FALCON II, 
which occurred in April 2006 in districts in the western half of the 
United States. More than 9,000 fugitives were arrested and more than 
10,400 warrants were cleared during Operation FALCON II. Since April 
2005, the three FALCON operations have resulted in the arrests of 
30,110 fugitives and the clearance of 37,603 warrants. Of those 
arrested, 3,314 were sex offenders and 681 were gang members. These 
results are a clear demonstration of what can be accomplished when law 
enforcement agencies pool their human resources and investigative 
assets to achieve a common goal.
    The success of these fugitive initiatives has been recognized by 
the Department of Justice, which will soon announce a series of mini-
FALCONs designed to focus on violent gang members in high priority 
cities. The first of these initiatives occurred the week of February 
25, 2007, in Baltimore, Maryland. Coordinated by the USMS Capital Area 
Regional Fugitive Task Force, we worked with our state and local law 
enforcement partners to arrest 195 felons in just five days. Of this 
number, 24 were documented gang members and another 20 were suspected 
gang members. Task Force officers arrested four individuals who had 
been listed as among the City of Baltimore's Most Wanted fugitives.
    The Marshals Service also is fully engaged in the battle against 
violent crime perpetrated by gang members. We have assigned a 
supervisory criminal investigator and a criminal analyst to the 
National Gang Intelligence Center, and we are a full participant in the 
newly-formed Gang Targeting, Enforcement and Coordination Center 
(GangTECC), whose primary goal is to establish national coordination, 
intelligence, and enforcement mechanisms to disrupt and dismantle the 
most significant, violent, national and regional gangs.
    The Marshals Service's activities with regard to gangs are not 
limited to enforcement, however. I have directed our district offices 
to explore creative avenues to address prevention and have encouraged 
participation in initiatives such as the G.R.E.A.T. (Gang Resistance, 
Education, and Training) program, which focuses on providing life 
skills to students to help them avoid using delinquent behavior and 
violence to solve their problems.
    The Marshals Service intends to expand its Fugitive Safe Surrender 
program in fiscal year 2007 and fiscal year 2008. Authorized under the 
Adam Walsh Act, Fugitive Safe Surrender is a creative, non-violent, and 
highly-successful, approach to fugitive apprehension. The goal of 
Fugitive Safe Surrender is to reduce the risk to law enforcement 
officers who pursue fugitives, to the neighborhoods in which they hide, 
and to the fugitives themselves. It encourages persons wanted for non-
violent felony or misdemeanor crimes to voluntarily surrender to the 
law in a faith-based or other neutral setting. Partnering with state 
and local law enforcement, the judiciary, and the religious community, 
the Marshals Service has undertaken two successful Fugitive Safe 
Surrender operations in Cleveland, Ohio, and Phoenix, Arizona, which 
resulted in the surrender of more than 2,150 individuals wanted on 
outstanding warrants.
    The next Fugitive Safe Surrender operation will take place in 
Indianapolis, Indiana beginning on April 25, 2007. Additional cities 
looking to host the program include Milwaukee, Wisconsin; Camden, New 
Jersey; Louisville, Kentucky; Nashville, Tennessee; Dallas, Texas; 
Albuquerque, New Mexico; Montgomery, Alabama; Jackson, Mississippi; 
Richmond, Virginia; and Washington, DC.
                        witness security program
    One of the most critical, and least known, responsibilities of the 
United States Marshals Service is the administration of the federal 
government's Witness Security Program. This Program provides for the 
security, health, and safety of government witnesses and their 
immediate dependents whose lives are in danger as a result of their 
testimony against drug traffickers, organized crime members, and 
terrorists. After the events of September 11, 2001, the Witness 
Security Program has assisted in the production and relocation of 
witnesses testifying in terrorism-related cases nationwide and abroad.
    Since the inception of the Program in 1970, more than 7,900 
witnesses and over 9,700 family members have entered the program and 
have been protected, relocated and given new identities by the U.S. 
Marshals Service. The successful operation of this program is widely 
recognized as providing a unique and valuable tool to the government's 
war against major criminal conspirators and organized crime, and I 
appreciate the Subcommittee's continuing support for this critical 
mission. I am pleased to report that no program participant who has 
followed the security guidelines of the program has been harmed while 
under the active protection of the U.S. Marshals Service.
    The fundamental principle of the Witness Security Program is the 
lifelong involvement with the witnesses and their families. As the 
program has evolved, the services provided to program participants 
continue to become more complex. For example, approximately 70 percent 
of new case participants are foreign-born. Relocating foreign nationals 
and ensuring their assimilation in a new community presents a host of 
difficult issues to overcome, including language and cultural barriers.
    In addition to its primary mission related to the nationwide 
protection and relocation of witnesses, the Witness Security Program is 
currently involved in many other foreign initiatives in conjunction 
with the Department of Justice, the Department of State, and the United 
Nations. As the recognized experts in this field, during the last three 
years, personnel assigned to the Witness Security Program have assisted 
countries such as Austria, Bahamas, Bosnia-Herzegovina, Chile, 
Colombia, Guatemala, Kosovo, Mexico, Panama, Russia, Serbia, and 
Thailand in the establishment and training of witness security units.
    In July of 2006, the U.S. Marshals Service sponsored the First 
International Witness Protection Symposium in Washington, DC. 
Participants included heads of witness security units and Senior Police 
Officials representing more than 17 countries across three continents. 
Additionally, the Marshals Service, in coordination with the Department 
of Justice, has posted a team of witness security specialists at the 
United States Embassy in Bogota, Colombia, to facilitate and provide 
consultation to the Colombian witness security program.
                 2007 global war on terror supplemental
    I would like to thank the Subcommittee for your continued support 
of our law enforcement and training efforts in Iraq and Afghanistan and 
for the Senate's recent passage of our request in the Global War on 
Terror Supplemental. The funds you have approved will be used to 
enhance security for two terrorist trials, the Jose Padilla trial in 
the Southern District of Florida, and the upcoming Babar Ahmed trial in 
the District of Connecticut.
    Last year, Congress provided $1 million directly to the Marshals 
Service as part of the Emergency Supplemental to fund our activities in 
Iraq. Other funding comes to us from the Department of State. Since 
2004, we have deployed Deputy Marshals from our Special Operations 
Group (SOG) to provide expertise in five key areas: security for 
judges, security for court facilities, security for witnesses, 
investigations tied to the Regime Crimes Liaison Office and the Major 
Crimes Task Force, and police training. To date, approximately 70 of 
our 98 Special Operations personnel have served on deployments of at 
least six months to Iraq.
    When enacted, the additional funding provided in the fiscal year 
2007 GWOT supplemental will be used to continue our operations in Iraq, 
and expand the Marshals Service's role in Afghanistan, where the 
Department of Justice has a significant role in combating organized 
crime and drug cartels. Funding will be used for logistical support and 
equipment to deploy Deputy Marshals to Afghanistan to establish a 
Judicial and Witness Security Protection Unit within the Counter-
Narcotics Police of Afghanistan. The Unit will enable narcotics 
trafficking cases to be successfully prosecuted under the Afghan 
Counter-Narcotics law. Until a safe environment is created, Afghan 
judges may continue to resist holding trials because of the threats 
made against their lives. Currently, our Special Operations Group has 
four personnel assigned to Kabul for a six-month rotation.
                               conclusion
    Madam Chairman, Senator Shelby, and Members of the Subcommittee, on 
behalf of the men and women of the United States Marshals Service, 
thank you for your ongoing support of our programs. In the last year, 
we have made significant progress in addressing the legitimate concerns 
expressed to us by Members of Congress concerning judicial security, 
and we have built upon our successful track record of reducing the 
number of violent felons in our communities. We also have achieved 
positive results in our less visible program areas, such as training of 
Deputy Marshals, criminal investigators, threat investigators, and 
administrative employees.
    However, I know that there is still much to do. I am committed to 
ensuring that we are efficient stewards of the resources you have 
entrusted to us, and I look forward to working with you to improve our 
performance in areas that are critical to domestic security and to 
build upon the successes we have already achieved. I would be happy to 
answer any questions you may have at this time.
                                 ______
                                 
                  Biographical Sketch of John F. Clark
    John F. Clark was appointed Director of the United States Marshals 
Service on March 17, 2006.
    Prior to his role as Director of the Marshals Service, Mr. Clark 
was appointed by President George W. Bush on November 12, 2002 to serve 
as the United States Marshal for the Eastern District of Virginia, 
which includes the Alexandria, Richmond, and Norfolk, Virginia offices. 
Prior to his appointment as U.S. Marshal, he was the Acting Marshal and 
Chief Deputy for the Eastern District of Virginia.
    Mr. Clark is a veteran of the Marshals Service, with over 20 years 
of experience. He began his career as a Deputy United States Marshal in 
the San Francisco, California office and later served in the San Jose, 
California; Richmond, Virginia; and Alexandria, Virginia offices. In 
addition to his field experience, Mr. Clark served in the Special 
Operations Group for seven years. During his tenure with the Marshals 
Service, Mr. Clark has held numerous senior management positions within 
the Headquarters organization, including Chief of the Internal Affairs 
Division and Chief of the International Fugitive Investigations 
Division. Prior to his employment with the Marshals Service, Mr. Clark 
was employed by the United States Capitol Police and the United States 
Border Patrol.
    Mr. Clark holds a Bachelor of Science degree from Syracuse 
University and an Associates degree from Hudson Valley Community 
College. He has completed the Executive Leadership programs at the 
Center for Creative Leadership and the Aspen Institute. He is married 
and lives in Virginia.

    Senator Mikulski. Well thank you very much, each and every 
one of your testimonies is much appreciated.
    Ordinarily we focus on numbers and the financial aspects of 
your agencies, but today I think is a little bit different and 
one of the things about each and every one of your testimonies 
talks about partnership, partnership, partnership. That your 
agencies stand sentry at a variety of threats facing the 
American people.
    The marshals from threats to our judges to pedophiles 
threatening their children on playgrounds, DEA at our borders 
and outside of our borders, working in world communities and of 
course, ATF, fighting gun crime, the trafficking of illegal 
guns, the trafficking of illegal bullets, and their whole 
effort to contribute to violent crime impact teams.
    Let me go to my question because we often talk about how do 
we connect the dots and how do we connect the people? How do we 
work together to amplify Federal resources at the local level?

                ATF deg.VIRGINIA TECH SITUATION

    So I'm going to ask you if you could, tell me what you did 
in terms of the Virginia Tech situation. People would say what 
would the marshals be doing there? What about ATF, DEA? I'd 
like you to tell your story because I think it shows how you 
work and how you maximize your resources.
    Mr. Sullivan, why don't we start with you and just go down 
the line and then I'll have an additional question or two and 
then we'll come back to you on the issues related to innovation 
and staffing.
    Mr. Sullivan. Thank you, Madam Chairman, and I certainly 
don't want to understate the role of the State and local law 
enforcement in an event like that.
    Senator Mikulski. No, this is where we want to talk. People 
don't think of you as first responders and also the augmenting 
and appropriate role where there is no Federalization of the 
situation so we understand, we acknowledge a campus police 
force overwhelmed by an event of staggering magnitude, a local 
sheriff's department, et cetera.
    It's a series of circles that went out.
    Mr. Sullivan. Thank you for the question. ATF was notified 
shortly after the second event occurred and we responded 
immediately with 12 special agents from the Roanoke field 
office. They did a range of things that would typically happen 
in an event like this, from trying to restore some order in an 
environment where there was a lot of panic, a lot of fear, and 
a lot of chaos, partnering up with State and local partners, 
and identifying exactly where crime scenes were.
    You can imagine an event that took place over a several 
hour period with victims, both victims that were killed and 
surviving victims, had a crime scene that was extremely large. 
We tried to identify where the crime scenes are, what evidence 
might be available at those crime scenes to help in the 
investigation, and participated in interviews.
    So from a general perspective, we did everything that a 
general law enforcement response would be expected to do and 
then we focused in on some very specialized skills that ATF has 
to support State and local law enforcement in the area of gun 
tracing. We had identified at the scene two weapons that were 
believed to be used.
    The questions during the early stages of the investigation 
was whether these two crime scenes were linked, the earlier 
crime scene that happened in the dormitory and the crime scene 
that unfolded in the classrooms. So it becomes critically 
important if there is a connection between the two that you can 
make those connections with the weapons and also the ballistics 
evidence.
    So the early stages of the investigation were spent looking 
at the weapons and our ability to trace those weapons in terms 
of where they were purchased from, who purchased them, and when 
they were purchased. We also tied in the ballistics evidence, 
using representative samplings of the ballistics evidence that 
were secured during the early stages. We had an investigative 
lead based on evidence that was secured at the crime scene, a 
receipt in a backpack, that sent us to a FFL in Virginia.
    Senator Mikulski. What is an FFL?
    Mr. Sullivan. It's a Federal firearms licensed dealer.
    Senator Mikulski. Ok, just wanted to be sure.
    Mr. Sullivan. We had that investigative lead that we 
explored by going out and interviewing the FFL to determine 
whether or not there was some additional information that could 
be helpful. Beyond that, we had the two weapons and as it was 
reported in the media, the serial numbers on the weapons were 
obliterated, making it more difficult in the early stages to 
identify where those weapons were originally shipped to for the 
purpose of private sale.
    The weapons and the ballistics evidence were sent to the 
laboratory in Ammendale, Maryland, for the purposes of raising 
the serial number, and to do test firings of the weapons to 
compare ballistics evidence and establish that the two scenes 
and the two weapons were, in fact, connected.
    Senator Mikulski. Well, that's a stunning set of resources 
and I'm going to come back before our colleagues just to be 
clear that what ATF provided was people and expertise. They 
discovered there were multiple guns used in the crime. This was 
a human tragedy; the scene of human tragedy was also a crime 
scene.
    Now what was the Marshals Service doing there? Why would 
the marshals be involved in this and what were they doing?
    Mr. Clark. Thank you, Senator.
    Yes, we did have the opportunity to send several of our 
deputy marshals there. Six deputies from our Blue Ridge 
fugitive task force responded right after the shooting began 
and before the full knowledge of the single shooter became 
apparent. They were sent to help secure the crime scene, to 
support the State and local investigators that were also 
responding, and to offer our expertise in the event that this 
individual had fled the scene, before they realized that he had 
killed himself.
    We had several of our deputy marshals who responded to 
Virginia Tech. We also offered the assistance of our national 
headquarters using these additional resources to locate 
individuals, in case there was a second shooter on the loose. 
We immediately supplied some of our investigators to help. I 
would also note that they were very instrumental, during and 
shortly after the shooting ended, in helping to secure the 
crime scene, supporting the local officers, and getting injured 
victims to the hospital.
    Senator Mikulski. Well, I'm sure they thank you for it. Ms. 
Tandy, tell us about DEA.
    Ms. Tandy. DEA's work through all of our enforcement 
operations is done in conjunction with State and local law 
enforcement so as soon as the shootings occurred, DEA contacted 
the local police department as well as the State police to 
determine what kind of assistance they needed from us.
    We were told that they specifically needed us to assist the 
SWAT team in providing perimeter security as well as in 
conducting searches of the buildings and enforcement sweeps of 
the various campus buildings. DEA's entire Roanoke field office 
responded to the campus to conduct those two responsibilities. 
It's actually a small office for us in the Washington division.
    Senator Mikulski. How many were there?
    Ms. Tandy. Ten agents responded and stayed throughout the 
course until everything was secure.
    Senator Mikulski. Well, I wanted you to tell your story. 
I'm really proud of you because this was a terrible thing that 
happened and just imagine a small campus police force, a local 
community with a sheriff police force and rural communities who 
are never overstaffed. They had a tragedy unfolding of enormous 
proportion and needed outside help.
    They had to protect the students. They had to deal with the 
crime scene. They didn't know if there were multiple killers 
and they had to deal with the panic that was occurring. The 
fact that you all work together on a day-to-day basis on other 
issues, whether it's meth, drugs or other areas related to 
violent crime. You all knew how to react in mutual response. Is 
that right?
    So when you all came in they weren't suspicious of you. 
They knew you and were eager to have you.
    Well, I think what this shows though is several things, 
number one, really the job that you do. This is one of the 
reasons I wanted to have this hearing. I think you're 
undervalued and often overlooked in the Federal budget.
    I'm going to come back, others have questions that will go 
then to your budget because we need to support you so you can 
do your national mission and play such a unique role to local 
communities in terms of our community safety. Whether it's the 
brilliant forensics that's going on right in Maryland to 
identify the guns, the bullets and so on with their unique 
tracing to the staffing that provided and at the end of the day 
you could go back to your other jobs while this community is in 
the process of recovery and healing.
    I do have specific budget questions but I wanted you to be 
able to tell your story and with that I'm going to turn to 
Senator Shelby.
    Senator Shelby. Thank you Senator Mikulski. Director Clark, 
I understand that a former marshal's daughter was wounded in 
the shootings in Virginia Tech last Monday and that also her 
efforts saved the lives of some of her classmates. I believe 
the marshal was Jim Carney, former marshal. Tell us that story; 
tell us what happened from what you know.
    Mr. Clark. It's a remarkable and a scary story. I had a 
chance to talk to Jim Carney, the retired deputy marshal. His 
daughter was among the individuals who were in the classroom, a 
German class, where most of the individuals, regrettably were 
killed.
    His daughter was one of only four who survived in that 
particular room. She was struck in the hand and one bullet 
grazed her head. I'm told that she is due to be released from 
the hospital today so, thankfully, she is making a quick and 
steady recovery. She also is credited with the other three who 
survived by helping to block the doorway to the gunman who had 
returned and was intent on finishing them off. They were able 
to hold the door back and to stave off his attempts to get back 
into the classroom.
    When I heard the story and I talked to Mr. Carney 
personally, I just could not believe the story and, of course, 
was glad that his daughter was going to recover. He was quite 
broken up by the whole event so my heart went out to him and 
the many victims of who were caught in that terrible event.

 ATF deg.NATIONAL CENTER FOR EXPLOSIVES TRAINING AND RESEARCH

    Senator Shelby. Director Sullivan, the National Center for 
Explosives Training and Research, what's the status of this 
project at the moment? I believe that we had gotten $10 million 
and you need $40 million, is that correct?
    Mr. Sullivan. I think we've estimated that the total cost 
for the project is somewhere between $40 to $45 million and the 
2006 budget, thanks to your leadership, had $5 million set 
aside specifically to do some early stages of site selection 
and development. We're extremely excited. We think this is 
really visionary.
    Senator Shelby. What will it add to ATF's ability to work 
in this area?
    Mr. Sullivan. I think when you're looking at the potential 
future threat of explosives, we have to do everything we can, 
within our ability, to protect the American public and we have 
to do it on multiple fronts.
    Obviously, in the whole area of explosives, detection is 
critically important, as are research, regulation, and post 
blast investigation. The post blast investigation reflects 
failures of the regulatory piece that protects the explosives 
material and the detection piece. The NLETR project brings a 
wealth of expertise to one location that we can use for 
research and development and sophisticated training, not only 
for Federal law enforcement agencies but for all of our State 
and local partners. There's a huge demand for training in these 
areas.
    Senator Shelby. Absolutely.
    Mr. Sullivan. Because locals recognize the vulnerabilities 
concerning explosives, I think once this center is up and 
operational, it's going to draw our resources together from all 
around the country, specialized resources that we can share 
with others that require this training. Even though this is 
very preliminary, we haven't even done groundbreaking at this 
stage of the game, we already have 11 agencies that are 
committed to sharing their expertise as part of this model. So 
it's visionary. It's something I hope will be a legacy of mine.
    Senator Shelby. Sure.
    Mr. Sullivan. Thanks to your leadership, we would hope to 
have this facility fully funded at some point in time to go 
forward.
    We have done site selection, as you know. We think the 
location at Redstone is the most appropriate location because 
of all the other expertise that's there. We have sufficient 
funding at this point in time to do some work at a range to 
allow us to use a range facility on site, to construct, not 
sophisticated classroom space, but a modified building where we 
could do some classroom training, and we have some money 
available to do some parking facilities but certainly we don't 
have sufficient funding at this point in time to do everything 
that you say that you'd want the site to have.
    Senator Shelby. Absolutely. This would carry you to another 
dimension at ATF as far as explosives, detection and everything 
else is concerned. Is that correct?
    Mr. Sullivan. Absolutely. It recognizes the expertise that 
the ATF has developed in this area over the last number of 
decades, focusing on explosives detection because of the 
threats posed by domestic and international terrorism. The 
NLETR project would bring us to that next significant level in 
terms of continuing to develop that expertise, staying several 
steps ahead of those folks that have an interest in posing a 
threat to us and to our country and capitalizing and sharing 
our resources and expertise with our partners at the State, 
local, and Federal levels.
    Senator Shelby. And also you have synergy with the Army 
there and the FBI. Is that correct?
    Mr. Sullivan. Absolutely and both have been extremely 
supportive with regards to the concept, the location and 
willingness to be part of a joint effort in the area of 
developing and sharing that expertise.
    Senator Shelby. Thank you. Madam Chairman.
    Senator Mikulski. Thank you, Senator Shelby and Senator 
Lautenberg thank you. I was concerned that, I know that you 
have to get to the Holocaust Memorial service.
    Senator Lautenberg. I did want to, Madam Chairman, if I 
can.
    Senator Mikulski. Yes.
    Senator Lautenberg. If I can take a quick couple of 
minutes?
    Senator Mikulski. Yes, yes.
    Senator Lautenberg. Is that acceptable to Senator Stevens?
    Senator Mikulski. Yes.

                     ATF deg.VIRGINIA TECH

    Senator Lautenberg. Thank you very much. I look at what 
we're witnessing here Madam Chairman and in these days of gloom 
and shock pervades our country. There can't be anyplace on our 
soil that doesn't share a feeling of personal mourning as we 
look at this incredible tragedy, almost impossible to imagine. 
Friends, when I look at the departments that each of you is 
responsible for, I salute you and the people who work in those 
departments.
    We have this acceleration of crime in all phases whether 
it's from drugs or guns and I look at the budget and the 
request for all of the Departments of Justice within Justice 
and we have about a 1\1/2\-percent increase. The request is 
$21.8 billion for 2008 and the war in Iraq costs us $3 billion 
a week, a week, so we've got 7 weeks of that cost devoted to 
all of our internal law enforcement projects that you folks are 
responsible for. We've cut out the COPS program essentially 
that's down from a level of $432 million down to nothing. Madam 
Chairman, you know how valuable that COPS program has been.
    We have to examine the terrible events at Virginia Tech and 
it needs to be done perhaps in a more sober moment entirely 
devoting our energy at that hearing to that. What did we learn 
from that? We learned that mad people, insane people, deranged 
people can do such damage. I don't understand why we continue 
to require data derived from gun purchases to be destroyed in 
24 hours. Why it is that we have 3 days to approve or deny a 
gun sale when perhaps there is more time needed.
    These aren't criminals. I'm not saying that everybody that 
buys a gun is a criminal, heavens no. And I'm not saying that 
we should wipe out the ownership of guns. I'm saying that it 
should be responsibly done and we shouldn't be trying to hide 
information, for what purpose?
    I wrote a law in 1996 that said that any spousal abuser 
should not be permitted to own a gun. It was a tough fight and 
Senator Mikulski, Senator Shelby know that I put that into a 
budget to a supplemental bill so it was must-pass legislation. 
Fought like the devil to find a way to get it through.
    We have kept 150,000 guns out of the hands of bullies. Can 
you imagine anybody who can get into that kind of a rage that 
they want to beat up their wife or beat their kids or abuse 
them in any other way, if they had been able to get their hands 
on a gun conveniently? What might have happened?
    America, wake up, wake up. We've had 11,000 deaths, 
homicides in a single year of measurement and what we found is 
that four countries, Great Britain, Germany, Japan, and Canada 
had 650 deaths and what I did was took a group that population 
is approximately ours and they had 650 deaths from handguns, 
weapons. We had 11,000 in the same year, 11,000. Why? Why did 
more than 10,000 of our citizens perish because we have these 
rules.

                   ATF deg.CRIME GUN TRACES

    I ask you Mr. Sullivan, and I'm grateful to my colleagues 
for allowing me this time. I wrote to your agency last year 
requesting the number of crime gun traces of the five-seven 
pistol. We know what a terrible weapon that is, can penetrate 
body armor; a number of those guns were recovered in New 
Jersey.
    The answer I received was, ``ATF has determined that the 
requested information cannot be disclosed to you.'' Mr. 
Sullivan, do you agree with the policy of restricting gun trace 
information this way and are you concerned that this policy 
will limit efforts to fight illegal gun trafficking.
    Mr. Sullivan. Senator, thank you for the question, is it 
specifically to the information that you were requesting and 
limiting the information to you as a Member of Congress?
    Senator Lautenberg. The number of crime gun traces of the 
five-seven pistol, weapon that's out there and can penetrate 
body armor.
    Mr. Sullivan. I'm of the opinion that that information 
could be shared with you and with this subcommittee. I think 
you have a legitimate interest in learning that information.
    In terms of restricting gun tracing information, from my 
experience as a prosecutor, a State prosecutor, and more 
recently as a U.S. attorney, I think gun tracing information 
should be considered law enforcement sensitive information and 
should only be shared with law enforcement agencies that have a 
need to know that information. That's been my approach in 
dealing with law enforcement sensitive information generally 
and it's my approach in terms of dealing specifically with gun 
tracing information.
    Now, having said that, I don't see anything, in my 
understanding or interpretation of statutory language, that 
prohibits me from sharing the gun tracing information with law 
enforcement agencies that have ongoing investigations as it 
relates to gun trafficking, patterns within their jurisdiction 
or specifically as it relates to gun tracing data based on 
weapons that they've asked ATF to trace.
    So I would hope and I'm not aware that we aren't doing 
this, but I would hope that ATF is sharing as much gun tracing 
information with law enforcement agencies that are requesting 
that information to enhance their ability to protect the people 
within their jurisdiction.
    Senator Lautenberg. And not to be shared with the Congress 
of the United States?
    Mr. Sullivan. I'm sorry?
    Senator Lautenberg. And not to be shared with Senators or 
Representatives in our Government?
    Mr. Sullivan. No, I think I said earlier, Senator, the 
information.
    Senator Lautenberg. I heard what you said, Mr. Sullivan and 
then I heard you kind of make sure that that information 
continued to be restricted.
    Mr. Sullivan. As I understand the other question you asked 
Senator, and I apologize because I did not.
    Senator Lautenberg. That's alright.
    Mr. Sullivan. Because I did not study the letter you sent. 
I did have the opportunity to read it and the response that was 
provided by ATF. I think that's more general information as 
opposed to specific law enforcement trace information. That 
type of general information, if you and this subcommittee had 
an interest in learning about what's happening generally with 
regard to types of weapons that are being traced, unless I'm 
told otherwise, could be shared with you and the members of 
this subcommittee.
    [The information follows:]
                 ATF deg.Trace Data Disclosure
    As it is ATF's policy that aggregated firearms trace data may be 
shared with members of congressional committees with jurisdictional 
authority over the Bureau, a policy consistent with current law, ATF 
will be providing the information the Senator has requested.

    Senator Lautenberg. Madam Chairman, forgive me and I have 
such respect for Mr. Sullivan, his record and law enforcement 
but the reason that this information is not available is 
because a Congressman decided that every year he would put that 
into a bill, to an appropriations bill and there is no earthly 
reason in my view that that single person should be able to 
restrict this information.
    We want to find out everything we can about this instance, 
but this is only one of many, it's just the largest of them 
all. We start with Columbine High School and go through 
shocking events in our history and we've got to find out ways 
to stop this. Thank you very much and thank you also.
    Senator Mikulski. Mr. Sullivan, of course our colleague is 
referring to the Tiahrt legislation and one suggestion is if 
you can take the Lautenberg letter and look at it in terms of 
the consequences of implementing the Tiahrt. We'll talk about 
the Tiahrt later.
    The Senator raises questions not about, what he wants to 
know, about an individual case. Rather he wants to have the 
epidemiology of information, data.
    We're now going to move on though, our two other colleagues 
have been waiting, Senator Stevens and then Senator Domenici. 
And Senator Domenici, I'll stay here as long as you need us to 
stay.
    Senator Stevens. Senator Domenici doesn't have a timeframe, 
I do.
    Senator Mikulski. Okay.
    Senator Stevens. I do want to join in congratulating you. I 
think there's been a really upbeat feeling about law 
enforcement recently because of the successes you've had.
    It's unfortunate and we all mourn the situation down in 
Virginia but from the point of view of what was going on, I 
think that your people have all been doing a much better job in 
really trying to get to the bottom of many of the problems we 
face.

            DEA deg.METHAMPHETAMINE LABS IN ALASKA

    However, I am, Ms. Tandy, a little disturbed that the 
statistics show there are fewer meth labs in my State, our 
State, Alaska, now but there's a higher level of meth in the 
State. I talked to some of your people in Anchorage. I found 
that they feel that a great deal of that is coming in now from 
the islands of the Pacific and people aren't using labs anymore 
because it's cheaper just to bring the stuff in from some 
enormous lab that's really not even looked at as far as the 
Pacific Islands are concerned. Do you have people who check 
places like Samoa and other places that we believe a lot of 
this meth is coming from? Are you attentive to the problems of 
the west being now inundated by imported meth?
    Ms. Tandy. I share your concerns about the shift in local 
domestic production of methamphetamine, which has dropped 
through the basement, which is a great thing in terms of the 
environmental risks and social child services issues, to the 
shift to the production of methamphetamine elsewhere outside of 
this country and the smuggling into this country from outside.
    Most of that is being produced in Mexico and elsewhere. The 
production in the Pacific and the areas outside of China, 
Malaysia, Indonesia, the Philippines are all matters that DEA 
is focused on. We have the largest law enforcement presence of 
any U.S. law enforcement agency outside of this country. We 
have focused our resources on the foreign side in the very 
areas that you've talked about as well as in the western 
hemisphere and beyond.
    The production of methamphetamine by foreign trafficking 
organizations has been fueled by the fact that the precursor 
chemicals for the most part come from China and are then 
diverted and used to fuel those labs in the areas that you've 
mentioned as well as in Mexico and elsewhere.
    We conduct our investigations.
    Senator Stevens. I thought we were entitled to 7 minutes? 
The set there seems to be running awfully fast.
    Senator Mikulski. You can take your time.
    Senator Stevens. I don't want to interrupt you, but I am 
limited and I do have the problem about the number of people in 
the State like mine.
    We're one-fifth the size of the United States, have the 
largest cargo landing airport now in the country and we feel a 
lot of the meth is coming in by cargo and somehow or other 
getting off of those planes that come through our Anchorage 
airport.
    I would urge you to take a look at that because I think 
with the decrease in the number of meth labs your people 
generally felt happy about it and reduce some of the effort in 
our State but the good news was as you say the fewer labs but 
the bad news is there's an overwhelming amount of meth.
    Ms. Tandy it's in small villages of 20 and 40 families. 
It's finding its way all the way through the 240 small native 
villages in my State and it is the number one problem that we 
face. I would urge that somehow you take a look at the concept 
of how many agents you have left. You only have 11 agents left 
in the whole State now.
    Ms. Tandy. I understand Senator and this has been part of 
DEA's problem. We are in a hiring freeze and are unable to 
expand our agent presence. To the contrary we are having to 
reduce our number of agents in order to meet our budget. The 
agents in Alaska, to the extent that, actually beyond Alaska, 
everywhere in the United States, those agents that were focused 
on domestic labs have shifted their focus to assisting in these 
investigations for the smuggling of finished meth into Alaska 
and elsewhere in the United States but I appreciate the point 
that you're making. It has been a concern to all of us.
    Senator Stevens. Well, I would hope that you would take a 
look at the concept of working out some cooperation with the 
various local people. This meth has to be getting out to these 
small villages through the post office. The only thing that 
goes into those villages is what we call bypass mail. Now 
somewhere someone is putting together packages that contain 
meth and we're subsidizing the transportation of that package 
into every village in the State.
    I do think it's a matter of investigation and believe me 
those villages are primarily supported by the Federal 
Government. They're native people, unemployment is about 85 
percent. How they're getting this stuff is driving us nuts and 
those kids get on this meth and they start coming into town. 
They will come to the nearest town and then they'll try to find 
their way to Anchorage or Fairbanks and they're committing 
horrendous crimes. We've got drive by shootings that we've 
never had before. We have enormous, just enormous theft and 
burglary and attacks on the person and it's coming, we believe 
because of this just overwhelming presence of meth.
    I know the rest of the country has the same problem but 
it's accentuated in our State. They must be giving it away in 
those villages in order to get them on to this habit and they 
come to town to steal and commit crimes to get money to 
continue it. So I urge you to do something about finding a way 
to work out a cooperative program to get to the bottom of this 
thing. It's taken off in the last year to the point where it is 
really crisis stage.
    I think you probably add up all the crimes that these young 
people have done, committed in our State in the last year and 
it would equal the number of deaths that took place in 
Virginia. I'm serious. It's a very serious situation in Alaska 
and we end up with 11 agents. We end up with 15 marshals and 
eight ATF officers in an area one-fifth the size of the United 
States. They can barely take care of Anchorage alone.
    I understand what you're saying and we're going to do 
something about that freeze. I don't like that freeze at all.
    Senator Mikulski. Well, if I might just comment to the 
Senator. First of all, just know that we're sympathetic to your 
situation.

                     DEA deg.HIRING FREEZE

    The second thing is in the supplemental, we lift the hiring 
freeze. Working with the administration and DEA we lifted the 
hiring freeze and have provided DEA with an additional $25 
million. So that's just as a point of reference to you Senator, 
but second, we would encourage Ms. Tandy meet with the 
Senator's very able staff because he really raises something 
that's rising to a, I think, a crisis situation.
    So know we're working with that and then anything that we 
can be doing because we don't think you should have a hiring 
freeze.
    Ms. Tandy. Thank you.
    Senator Mikulski. And we'll come back to that even to talk 
about it in a more substantial form.
    Senator Stevens. Added to that is the problem of increased 
illegal immigration into our State. We've never had that 
before, but all of a sudden now we are just inundated with 
illegals following this meth. I think meth is the key so I 
appreciate your comments.
    Senator Mikulski. Senator, any way we work with you, we're 
happy to do it because I think it's also a story that's 
happening around the country. You bet, you bet.
    Senator Stevens. Those planes come right down to this, 70 
percent of the air cargo that's coming through from the Pacific 
is coming through Anchorage now. It's coming into the rest of 
the country. This is the place to shut it off. Thank you very 
much.
    Senator Mikulski. You are welcome, sir. Senator Domenici, 
we're glad to have you back.
    Senator Domenici. Thank you very much, Madam Chairman. I'm 
delighted to be back and I don't frequent this subcommittee as 
you know while I serve on it for quite some time, but meth 
brings me running over here because New Mexico as a border 
State is having an absolute.
    There's a rage occurring in reference to meth and New 
Mexico and I think most of you who are participants in anything 
to do with meth you know that our Congressman Pearce has a done 
a pretty good job at bringing that meth problem to the surface 
in New Mexico and it is not, there's not the same problem of 
marijuana.

   DEA deg.SOUTHWEST BORDER AND METH ENFORCEMENT INITIATIVE

    Marijuana may be bigger in numbers and the like and alcohol 
might be but this one is one of the worst we've ever seen. You 
know that. It's going after all kinds of people including many 
women and they're not young women. They're women with children 
whose children have been taken away because they can't maintain 
them and so you see women truly in terrible shape, who've had 
their children removed, who are living in isolated places and 
we just have to move with a little more resources and a little 
more knowledge to try to do something about it and I understand 
that the DEA is requesting $29 million for the Southwest border 
and meth enforcement initiative. Is that correct?
    Ms. Tandy. Thank you Senator. It is correct and that 
consists of aircraft as well as technology as well as 
surveillance enhancements, intelligence sharing, pieces also 
form part of that budget request that are specifically directed 
to methamphetamine and the trafficking, production, and 
transportation of that into the United States.
    Just to put into context, Senator, there have been a number 
of improvements along the way with this shift that has really, 
it's a recent shift of the production of methamphetamine 
outside the country and even with that we have seized two 
metric tons of methamphetamine just over the past year. That is 
an increase of 129 percent in seizures of meth along the 
Southwest border.
    In addition to that we have a partnership now with Mexico 
that frankly we have not enjoyed at this level at any time 
previously, where we are conducting joint operations, as well 
as targeting meth organizations. DEA has sent to Mexico eight 
clan lab trucks to assist in the meth production operations 
against these organizations, along with some of the other 
enforcement operations that have already been addressed at this 
hearing.
    Senator Domenici. Well, I'm very much appreciative of all 
of the effort that's taking place and I congratulate all of you 
for the extra effort that meth has added to your very strong 
and difficult task.
    I'm also concerned about the Native Americans. I think that 
we're just beginning to move into those areas where our Native 
Americans live and finding, it should not have been a surprise, 
but it was to many of us that meth has entered the Native 
communities in abundance and it's because it is cheap and 
quick. If they're looking for a fix, it's quick. If they're 
looking for the results, it's not very quick. It's everlasting 
it seems like, very hard to cure, but I want to thank you for 
that and I know.
    Mr. Sullivan, I don't know you, but I have gathered that 
congratulatory remarks are in order and I would feel remiss if 
I didn't join in saying the best of luck to you.
    Madam Chairman and my good friend from Alabama, let me 
choose to give you an observation and a prediction. I shouldn't 
do this but, starting 5 years ago because of my work with the 
mentally ill and we have accomplished a great number of things. 
We're waiting now for the last bill to get passed on parity.
    I've been privileged to work with some of the smartest 
people in the United States on what's going wrong with the 
mentally ill and the commission of serious crimes such as 
murder by those who are mentally ill and have been committed to 
the institutions for care and maintenance and I will predict 
for you that the final result of this investigation will be 
twofold.
    The United States of America does not have enough centers 
for taking care of people who are mentally ill who are assigned 
to inpatient clinics by judges. We have a total lack of 
facilities across this land because when we decided to go from 
the places where we held the mentally ill we did have; no new 
facilities were built as contemplated by then President 
Kennedy.
    Congress baulked and we built none essentially. We're 
living in a kind of hand to foot creation of facilities. We got 
policemen who house more mentally ill than do any facilities. 
You know that as of this morning, more of the serious mentally 
ill are in police stations and being assigned to police cells 
than anyplace else in any other facilities.
    So number one the report is going to say what's wrong with 
America. We better build inpatient facilities on some kind of a 
partnership with our States so we have a place to take care of 
the mentally ill.
    The second thing that's going to come out unequivocally is 
that the States have not worked together to find a simple 
approach to how you get people committed and how you keep them 
committed until they get well. Right now they get out very 
quickly. When they get out is that period of time that things 
like this happen.
    We're going to have to work on it and we won't escape it. 
The States will be criticized heavily and this State in which 
it happened will be looked at very much to see what they did 
and didn't do, but eventually we're going to have to have a big 
program to build facilities in conjunction with the States and 
we're going to have to have some uniformity of in-house 
commitment where people with serious mental illnesses will stay 
in facilities rather than be released so quickly and so easily 
because we don't want to exercise jurisdiction over sick people 
but that's going to have to happen.
    I regret this day as if it was 5 years ago when I started 
reviewing the best article ever written was by the New York 
Times where they reviewed some hundred plus cases of the type 
I'm telling you about and they found that's what precisely was 
happening that most of these murders were being done by sick 
people who were released too early under the most grotesque of 
facts.
    The neighbors knew they were doing things crazy, wild, all 
kinds of things to their relatives and nonetheless nobody could 
do anything about it because they could not get the kind of 
cooperation between law and those who wanted to help put them 
away and that's going to change within the next 1\1/2\ or 2 
years in my opinion big time and we'll be in the middle of it 
because we can't leave it up solely to the States.
    I look forward to presenting some more issues to talk about 
to this subcommittee as we move ahead. Thank you very much.
    Senator Mikulski. Senator we'd welcome that. First of all 
we want to salute you because you have been a long time 
advocate for mental health services. We note with affection 
your special relationship you had with our lately departed 
colleague, Senator Wellstone, on this issue. You continue to 
carry the torch. You're exactly right. We need to be looking at 
that, the whole Congress, in a variety of our subcommittees.
    The second thing is that at this time, this is not the time 
for finger pointing. This is the time for pin pointing what 
happened here and how we can make sure that it never happens 
again.
    Each and every man and woman in this room has made a 
difference but you know, and they make a difference every 
single day in terms of protecting our country from again, 
community security or national security, which you know if we 
all worked together. You've made a difference, Senator Shelby, 
all of us in this room. You know when we all work together we 
can make change and that's why we wanted to hear you today.
    We could talk so much again about your individual missions 
of the agency, the particular budget needs that have been 
raised by my colleagues and myself but know that we're on your 
side. We want to help you be you, and we know you have a tough 
job. You come in after everything goes wrong and whether it's 
people trying to kill our troops in Afghanistan and Mr. 
Sullivan, we know that you're there and in Iraq, where Ms. 
Tandy, fighting drugs, we know you're there. You U.S. marshals 
have to guard terrorists and give them the rights that they 
wouldn't give anybody and so we're ready to work with you.
    We also have discussed among ourselves, Ms. Tandy, that 
there's certain elements of your testimony we think would be 
better addressed in a closed or classified situation. We'll 
notify you of that because we would like to pursue some of 
these issues related to the international dealing of drugs as 
well as what this means to our borders.
    There's many questions we could ask today and they can go 
to everything from gun control to border control to self 
control, but I think we've covered our topics today unless the 
panel has anything else. We will recess until next week with 
the FBI.
    Senator Shelby. Madam Chairman.
    Senator Mikulski. Senator Shelby.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Shelby. Madam Chairman, I have a number of 
questions for the panel that I'd like to submit for the record 
and I would also, Madam Chairman, think it might be in order at 
the proper time sometime to have Director Sullivan in a 
classified hearing and that might cover some of the ground that 
Senator Lautenberg had raised because what you're talking about 
is very sensitive stuff in that area, are you not, Mr. 
Sullivan? Thank you, Madam Chairman.
    Senator Mikulski. My colleague raises a new point. In terms 
of the Tiahrt, would that be better in a round table or would 
it be better if, because there are classified things to talk 
about.
    Why don't you talk with us afterward about what is the best 
mechanism because what we want to do is, we want to have the 
right policies and we want to have those policies rightly 
restored?
    That's why we want to lift these freezing caps and get you 
the people you need, you need new technologies because the bad 
guys have new technologies and you've got to be, we've got to 
help you be as fit for duty as you can.
    Did you want to?
    Senator Domenici. Yes, I just want to say I hope my 
observations were not construed to be pin pointing.
    Senator Mikulski. No, please, Senator, that's what I was 
saying. No, you were pin pointing, you weren't finger pointing. 
You were saying we got to get real about providing a continuing 
of service for mental health.
    As you know sir, my professional background is that of a 
social worker and also my involvement whether it's been in 
preventing domestic violence to worrying about our police 
officers, I've got a well known and beloved police officer in 
Maryland 3 weeks before retirement, a guy shot through the door 
and killed him because he didn't take his meds.
    So, I mean, no, no, your points were well taken. They were 
right on the mark and we think that not only this subcommittee 
but the entire Senate.
    Senator Domenici. Oh, yes.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
               Questions Submitted to Michael J. Sullivan
           Questions Submitted by Senator Barbara A. Mikulski
                            tiahrt amendment
    Question. Since 2004, the CJS Bill has included language known as 
the Tiahrt Amendment, which restricts the sharing of ATF gun trace 
information. The President's budget continues this language with a 
modification.
    Please explain the Tiahrt language.
    Answer. Since 2003, ATF's annual appropriation has contained a 
nondisclosure provision applicable to firearms trace data which is 
referred to as the ``Tiahrt Amendment.'' This language prohibits ATF 
from expending funds to disclose any of the contents of the Firearms 
Tracing System (FTS) or any required Gun Control Act (GCA) information 
to anyone other than a law enforcement agency or a prosecutor solely in 
connection with and for use in a bona fide criminal investigation or 
prosecution, and then only such information pertaining to their 
geographic jurisdiction.
    As originally drafted, the Tiahrt Amendment codified ATF's 
longstanding policy to provide access to firearms trace results to the 
law enforcement agency that has jurisdiction over the trace request 
while safeguarding those results from third parties. This policy, which 
is supported by law enforcement organizations such as the Fraternal 
Order of Police, recognizes ATF's interest in deciding how to utilize 
and whether to disseminate its sensitive law enforcement information, 
since premature and indiscriminate disclosure of firearms trace results 
could compromise criminal investigations and potentially jeopardize the 
safety of witnesses, informants, and law enforcement personnel. 
Moreover, once law enforcement agencies receive trace data from ATF, 
they remain free to share their firearms trace data with other law 
enforcement entities, since such sharing is consistent with this 
policy.
    Question. How does the President's budget request modify the 
language?
    Answer. The revised language first clarifies and confirms that 
firearms trace data may be shared with tribal and foreign law 
enforcement agencies. This corrects an unintentional drafting error and 
is wholly consistent with ATF's law enforcement mission and the express 
purpose of the Gun Control Act.
    The revised language also clarifies and confirms that firearms 
trace data may be shared with Federal agencies for national security 
purposes. In the Department's view, Congress never intended to prohibit 
intelligence or security agencies from requesting firearms traces in 
the course of anti-terrorist or homeland security investigations. 
Sharing of information pursuant to such requests is wholly consistent 
with the Department of Justice mission.
    The revised language also removes the ``geographic jurisdiction'' 
limitation. The current appropriations restriction allows ATF to share 
information ``as it pertains to the geographic jurisdiction of the law 
enforcement agency requesting the information.'' This requirement was 
removed to make clear that state and local law enforcement agencies 
that receive trace information may lawfully disclose that information 
to other law enforcement agencies within their investigative 
discretion. Despite the removal of the ``geographic jurisdiction'' 
limitation in the President's fiscal year 2008 budget language, ATF 
will continue its longstanding policy of disclosing firearms trace 
results only to the law enforcement agency that requested ATF to trace 
the firearm. This policy prevents any indiscriminate disclosure of 
trace information that could jeopardize pending investigations and the 
safety of witnesses, informants, and law enforcement personnel.
    Finally, the revised language requires that law enforcement 
agencies or personnel ``certify'' that the trace information is being 
sought in connection with a bona fide criminal investigation or 
prosecution. The Department of Justice's position is that this 
requirement to ``certify'' does not impose any new responsibilities on 
law enforcement. Under the Gun Control Act, ATF can only require that 
federal firearms licensees respond to ATF with records for determining 
the disposition of firearms (i.e. ``trace information'') when ATF's 
request is connected to a legitimate law enforcement investigation. As 
a result, there has always been a requirement that local law 
enforcement trace requests to ATF also be connected to a legitimate law 
enforcement investigation. The current trace request form, which 
requires the requesting agency to enter an NCIC crime code, is already 
a form of certification that satisfies the requirement in the fiscal 
year 2008 budget request. If a law enforcement officer presently 
falsifies information on the trace data request form, he could be 
subject to prosecution under 18 U.S.C. 1001 in the same manner as 
others who violate the statute by lying on a federal form. That is true 
independent of the appropriations language.
    Question. As I understand the President's proposal--it is very 
detailed permanent authorizing language including--is that correct?
    Answer. The proposal does contain ``language of futurity'' which 
applies to the fiscal year in question and thereafter. Such language of 
futurity has also appeared in previous iterations of the Tiahrt 
Amendment.
    Question. Is the Administration working with the authorizing 
committees on this language?
    Answer. The Department of Justice is not currently, but would be 
pleased to work with the authorizing committees on this language.
                       federal firearms licensees
    Question. What are the tools available to put corrupt gun dealers 
out of business?
    Answer. Under 18 U.S.C. 923(e), ATF has the authority to revoke a 
Federal firearms license if a dealer commits a willful violation of the 
Gun Control Act of 1968 (GCA). ATF conducts FFL inspections to verify 
that FFLs are complying with the provisions of the GCA and its 
implementing regulations, and to detect and prevent the diversion of 
firearms from legal to illegal commerce. ATF also investigates any 
substantive information regarding illegal activity by a Federal 
firearms licensee (FFL), and may recommend criminal prosecution for 
willful violations of the GCA.
    Question. Isn't suing them an effective way of shutting them down?
    Answer. Suing an FFL is not an option available to ATF nor do we 
think it would be an effective tool for overseeing and regulating the 
firearms industry. ATF meets its statutory and regulatory obligations 
through criminal investigation of FFLs that commit illegal acts and 
through its regulatory inspection program. Therefore, an FFL that is 
not meeting its statutory and regulatory obligations could be ``shut 
down'' through criminal investigation and subsequent prosecution and 
through an administrative remedy, such as license revocation.
    Question. What is ATF doing to put these gun dealers who sell 
illegal guns out of business?
    Answer. ATF is committed to enforcing the Federal firearms laws as 
enacted by Congress. As allowed under the GCA, ATF revokes Federal 
firearms licenses for willful violations of the Act. Over the past 
several years, there has been an increase in license revocations, 
partially due to additional training for field managers, improved 
guidelines for conducting inspections, and better utilization of 
information to identify which licensees should be inspected. ATF 
typically revokes licenses where the FFL has willfully and repeatedly 
failed to account for firearms or to ensure buyer eligibility. In 
addition to these administrative actions, under certain circumstances, 
ATF may investigate firearms dealers for criminal violations of the 
GCA.
    ATF works on a daily basis to assist FFLs in their compliance 
obligations. The vast majority of inspections in which licensees are 
cited for violations do not result in revocation. In fact, the 
inspection process usually results in greater compliance and fewer 
violations during subsequent inspections. Overall, ATF revokes only a 
small percentage of FFLs where violations are found. In 2006, ATF 
revoked 115 licenses out of 7,000 inspected (1.4 percent) and a 
licensee population of approximately 108,000. The Department is 
currently developing a legislative proposal, the Violent Crime and 
Anti-terrorism bill, which proposes graduated sanctions for use against 
FFLs that are in violation of certain GCA provisions, but which do not 
rise to the level of license revocation. ATF believes that this will 
also promote greater FFL accountability and compliance.
    A review of the most current data in our case management systems 
indicates that the following number of criminal charges were brought 
against FFLs since fiscal year 2000:

------------------------------------------------------------------------
                                                                 Number
------------------------------------------------------------------------
Fiscal year:
    2000.....................................................         14
    2001.....................................................         17
    2002.....................................................         20
    2003.....................................................         33
    2004.....................................................         42
    2005.....................................................         31
    2006.....................................................         32
------------------------------------------------------------------------

    Citations: 18 U.S.C. 1001; 18 U.S.C. (2); 18 U.S.C. 47; 18 U.S.C. 
111; 18 U.S.C. 371; 18 U.S.C. 844(h)(1); 18 U.S.C. 844(i); 18 U.S.C. 
922(a)(1)(A); 18 U.S.C. 922(a)(2); 18 U.S.C. 922(a)(5); 18 U.S.C. 
922(a)(6); 18 U.S.C. 922(b)(2); 18 U.S.C. 922(b)(3); 18 U.S.C. 
922(d)(1); 18 U.S.C. 922(d)(3); 18 U.S.C. 922(d)(5)(B); 18 U.S.C. 
922(d)(9); 18 U.S.C. 922(g)(1); 18 U.S.C. 922(g)(3); 18 U.S.C. 
922(g)(8); 18 U.S.C. 922(j); 18 U.S.C. 922(k); 18 U.S.C. 922(l); 18 
U.S.C. 922(m); 18 U.S.C. 922(o); 18 U.S.C. 922(s); 18 U.S.C. 922(v)(1); 
18 U.S.C. 922(w)(1); 18 U.S.C. 924 (a)(1)(A); 18 U.S.C. 924(c); 18 
U.S.C. 1341; 18 U.S.C. 1343; 18 U.S.C. 1503; 18 U.S.C. 1956(a)(1); 21 
U.S.C. 841(a)(1); 26 U.S.C. 5861(d); 26 U.S.C. 5861(e); 26 U.S.C. 
5861(f); 26 U.S.C. 5861(g); 26 U.S.C. 7206;
    Question. Does ATF have all the resources it needs to go after 
these corrupt gun dealers?
    Answer. After the implementation of the Safe Explosives Act in 
2002, ATF increased its total number of field IOIs from 420 to 650 
(fiscal year 2004-2005), and currently ATF has 594 IOIs on board. The 
Safe Explosives Act requires that ATF inspect each explosives industry 
member at least once every three years. This requirement places a 
significant demand on ATF's inspection force and it requires ATF to use 
flexibility in adjusting the total number of inspector hours dedicated 
to the firearms industry. ATF regularly reviews its programs and 
results to reduce inefficiency and increase effectiveness. This process 
includes the evaluation of all of our inspection procedures. In this 
way, ineffective procedures can be identified, and ATF's inspection 
efficiency is maximized.
    Recall inspections of FFLs have shown a resulting increase in 
compliance for those licensees who have previously been inspected. The 
increased compliance has resulted in fewer violations and license 
revocations. Fiscal year 2006 recall inspections resulted in an 
increased compliance rate of 91 percent for inventory discrepancies and 
an increased compliance rate for 64 percent for total violations.
    Question. What are the statistics on the number of rogue dealers 
selling illegal guns to criminals?
    Answer. A review of current data in our case management systems 
indicates that in fiscal year 2006, 32 gun dealers had criminal charges 
brought against them for violating Federal gun laws. In addition, 115 
licensees had their FFL revoked through the regulatory inspection 
process. It is important to note that the revocation of a FFL is not 
indicative of criminal activity. The graduated sanctions for FFLs 
proposed in the Department's draft ``Crime bill'' will help address 
this issue and revocations will continue to be reserved for the worst 
licensee violations. Below is a chart that shows the number of 
revocations for the past several years.

------------------------------------------------------------------------
                                                           FFLs Revoked
                          Year                               National
                                                              Totals
------------------------------------------------------------------------
2004....................................................              54
2005....................................................             104
2006....................................................             115
------------------------------------------------------------------------

                                 ______
                                 
            Questions Submitted by Senator Richard C. Shelby
                           funding shortfall
    Question. Your fiscal year 2008 budget requests were developed long 
before passage of the Joint Resolution.
    Can each of you tell this Committee if the 2008 budget request will 
meet your current operating needs? If not, can you tell the Committee 
if the Department has begun to engage in any cost savings to mitigate 
any negative impacts from 2007 to 2008?
    Answer. ATF supports the fiscal year 2008 President's budget 
request that is currently pending approval with Congress. The 
President's request was the result of an extensive deliberative process 
and strongly supports ATF's and the Department of Justice's mission to 
reduce violence and protect our citizens.
    Question. Do you expect to submit a budget amendment to ensure that 
your critical law enforcement operations are not negatively affected by 
any funding shortfall in your 2008 request?
    Answer. No.
                       gangs and gun trafficking
    Question. Mr. Sullivan, in 2006 the ATF referred more gang related 
defendants for prosecution than any other Federal law enforcement 
agency.
    Can you tell us more about ATF's success in going after gangs?
    Answer. ATF has approximately 2,000 special agents dedicated 
exclusively to investigating violent crime and gangs. In fiscal year 
2006, ATF initiated 2,023 gang related cases. This represents an 
increase of 157 percent from 2002. Additionally in fiscal year 2006, 
1,680 defendants in gang related cases initiated by ATF were convicted, 
an increase of 289 percent from fiscal year 2002. In total, ATF has 
referred more than 10,000 gang members for prosecution between fiscal 
year 2003 and fiscal year 2006.
    ATF has long been involved in investigations of groups such as the 
Mara Salvatrucha (MS-13), organized criminal Asian gangs, violent white 
supremacists, and outlaw motorcycle organizations such as the Hell's 
Angels and the Banditos. For example, an ATF-Baltimore investigation 
led to Racketeer Influenced and Corrupt Organization Act (RICO) charges 
in a MS-13 gang case against 23 subjects who have been arrested and 
indicted. The April 2006 indictment charged numerous RICO predicate 
acts including seven homicides and numerous shootings, beatings, and 
other violent crimes in aid of racketeering. ATF coordinates efforts of 
Federal, State and local law enforcement working through the Regional 
Anti-Gang Enforcement Task Force to combat violent Latino gangs in 
Maryland's Prince George and Montgomery Counties. Twenty-three MS-13 
gang members have been charged in a 36 count federal indictment 
including numerous shootings and other assaults, kidnapping, seven 
homicides, kidnapping, witness intimidation and other violent crimes.
    In January 2007, 13 members of the MS-13 street gang were arrested 
and indicted following a year-long joint investigation conducted by ATF 
and the Nashville Metropolitan Police Department. During the 
investigation, information was developed linking Nashville-based MS-13 
members and associates with seven shootings, three alleged murders, 
several planned murders, threats and intimidation, and other violent 
crimes that occurred in 2006. The defendants were indicted on 
racketeering conspiracy charges. If convicted, the defendants face a 
maximum penalty of life in prison on the RICO conspiracy charges.
    Question. What type of operational intelligence does ATF use to go 
after these criminals?
    Answer. ATF partners with other Federal law enforcement agencies 
and State and local law enforcement to investigate the most egregious 
violent criminals and violent criminal organizations. ATF special 
agents work with local police to try and identify the ``worst of the 
worst'' gang members and target these violent offenders first--using 
undercover operations, surveillance, wiretaps, and the controlled 
purchase of drugs, guns, explosives, and other contraband to identify 
and attack the gang's hierarchy. For example, in Chicago, ATF has used 
Title III wire taps in numerous gang investigations and recently 
completed a RICO case against the Aurora Insane Deuce gang. This case 
has been described by personnel at the U.S. Attorneys Office in Chicago 
as the template for future RICO gang investigations.
    ATF is also an active participant in the National Gang Targeting, 
Enforcement and Coordination Center (GangTECC), which is a DOJ-led task 
force with a mission to disrupt and dismantle the most violent gangs in 
the United States in the interest of national security, border 
protection, and public safety. Three ATF special agents, including one 
who is serving as the first Deputy Director, are supporting GangTECC 
activities. GangTECC serves as a central coordinating center for multi-
jurisdictional gang investigations involving Federal law enforcement 
agencies.
    ATF's 23 Field Intelligence Groups (FIGs) provide intelligence 
services and support to ATF field offices throughout the United States. 
These Field Intelligence Groups are comprised of Special Agents, 
Intelligence Research Specialists, and Investigative Analysts who 
provide specialized support by producing crucial tactical and strategic 
intelligence products and other analytical services. FIGs provide 
investigative leads using gun trace data, multiple firearms sales, and 
firearms theft reports. Field Intelligence Groups also compare and 
share Tactical Intelligence collected in support of investigations with 
OSII IRS and National Gang Intelligence Center staff to help build on 
Strategic Intelligence that benefits gang investigations across the 
United States. They also serve as the conduit of information between 
field personnel assigned to the local Joint Terrorism Task Force (JTTF) 
and ATF.
     national center for explosives training and research--redstone
    Question. ATF now has $10 million of the more than $40 million 
necessary to build a permanent site for the National Center for 
Explosives Training and Research NCETR (pronounced N-seed-R).
    Can you tell us the status of this project?
    Answer. ATF has been working closely with the Redstone Department 
of Public Works and the Army Corp of Engineers on this project. An 
Exhibit 300 (Capital Asset Plan and Business Case Summary) for the 
NCETR project has been completed and submitted via the electronic 
Capital Planning and Investment Control (e-CPIC) system. ATF is 
finalizing the design for the National Center for Explosives Training 
and Research (NCETR) with the Army Corps of Engineers and is 
anticipating a final product in early July. Additionally, ATF is 
awaiting an environmental assessment to be completed by Redstone 
Arsenal. Once the environmental assessment is complete, ATF will begin 
construction of an explosives range on the south end of the base, as 
plans for the range have been completed. Upon completion, ATF will 
begin explosives training courses at Redstone.
    Question. Once completed what will this training center provide to 
the ATF that does not exist today?
    Answer. ATF is tasked with being the lead Federal agency on 
explosives incidents and has developed expertise and fostered a strong 
reputation on such matters. The demands placed upon ATF for Federal, 
State, local, international and military training and research are 
many. NCETR will ensure that we meet those demands.
    NCETR will provide a physical infrastructure for the experts in the 
explosives field to conduct advanced research, exploit intelligence 
related to explosives and improvised explosives devices, and train in 
the most advanced techniques to deter and prevent the criminal misuse 
of explosives. The number and types of classrooms and the range space 
at NCETR will allow ATF to substantially increase its training 
capacity. For instance, at our current facility we are generally 
limited to detonating explosives of 50 pounds or less. However, the 
future facility at Redstone will allow us to detonate a 500 pound 
explosive, which is equivalent to a vehicle bomb. This would give us 
the ability to train for real world applications. In addition, NCETR 
will provide a location to leverage our partnerships on a full time 
basis for training and research opportunities.
    Furthermore, this facility will provide the explosives community in 
law enforcement and DOD something that does not exist today. Current 
Federal resources primarily address render safe capabilities and only 
cover approximately 20 percent of the explosives field. NCETR will 
provide the venue and capacity to impact the other 80 percent of the 
explosives field, including advanced training, research, intelligence 
and investigations. ATF is uniquely positioned, as a result of its 
broad explosives related expertise, to manage and deliver comprehensive 
and progressive training programs with offerings of introductory, 
advanced, and specialized fire and explosives training programs to a 
diverse audience of domestic, military and international students. 
These students comprise a broad spectrum of learners, from first 
responders to prosecutors. The NCETR facility will be the first of its 
kind in size and scope related to explosives training.
    Question. Do you believe this center will add to ATF's operational 
expertise?
    Answer. Yes. As stated above, this facility will provide ATF with 
the opportunity to advance our explosives expertise through research 
partnerships, and share the results of that research with our law 
enforcement and military partners.
    NCETR, through collaboration, will further our understanding of 
explosives scenes to train crime scene personnel to identify, collect 
and process evidence necessary for a conviction of a suspected 
terrorist or other crime suspect. The ATF United States Bomb Data 
Center (USBDC), a nationwide and international database at the 
forefront of data collection and dissemination, also will be located at 
Huntsville. Finally, through our regulatory authorities, ATF will share 
its expertise with State and local entities to ensure consistency in 
reporting and gathering data.
                               explosives
    Question. Director Sullivan your agency's fiscal year 2008 budget 
request includes $10 million to support ATF's arson and explosives 
programs.
    Answer. The $10 million in the fiscal year 2008 President's budget 
for the Explosives User Fee Offset is an increase that targets ATF's 
highest priorities which include Explosives Enforcement Activity, 
Explosive Industry Operations, Canine Enforcement Activity and Safe 
Explosives Act implementation.
    Question. Can you tell us more about ATF's role in enforcing 
Federal laws as they relate to destructive devices, explosives and 
arson and how this request will assist your agency in its critical 
mission requirements?
    Answer. ATF is the primary Federal agency responsible for 
administering and enforcing the regulatory and criminal provisions of 
the Federal laws pertaining to explosives, bombs and other destructive 
devices, and arson. ATF's mission includes deterring and investigating 
violations relating to destructive devices, explosives and arson. ATF 
is in a unique position to not only investigate arson and explosives 
related crimes and regulate commerce in explosives but also to provide 
intelligence and training to other law enforcement partners on these 
critical matters.
    Since 1978, ATF has investigated more than 28,000 incidents 
involving explosives. Since 1978, ATF has investigated 79,161 arson and 
explosives incidents. In fiscal year 2006, ATF initiated 4,060 arson 
and explosives investigations, of which 2,222 were explosives cases. 
These cases involved the investigation of over 13,000 bombings and 
15,000 incidents involving recovered explosives, including homemade 
explosives and improvised explosives devices. ATF initiated over 3,500 
investigations concerning thefts of explosives and explosives materials 
and has conducted thousands of regulatory inspections of licensed 
explosives dealers and manufactures. ATF personnel have also been 
involved in virtually every bombing incident in the United States 
including the 1993 World Trade Center Bombing; the UNABOMB 
investigation; the Oklahoma City Alfred P. Murrah Federal Building 
bombing; and the Centennial Park Bombing.
    Our Fire Research Laboratory (FRL) provides state-of-the-art 
forensic fire science expertise to aid fire investigations. The FRL has 
the capability of simulating fire scenarios approaching a quarter-acre 
in size, to scale, under controlled conditions, which allows for 
detailed analysis. It is the only such facility in the United States 
dedicated to providing case support in fire investigations using 
forensic fire science.
    All arson and explosives incident databases within the Department 
of Justice have been consolidated by ATF into the Bomb Arson Tracking 
System (BATS) which now has over 42,000 records from over 700 agencies 
and is accessible to Federal, State and local law enforcement agencies. 
In addition to its use as an incident database, BATS serves as a case 
management system by arson and explosives incident investigators at all 
levels of government.
    This budget request will ensure that the most advanced training 
opportunities will continue to be offered to all military and law 
enforcement agencies in the United States. Currently, several Federal 
entities, including the Hazardous Devices School (HDS) operated by the 
United States Army on behalf of the FBI, offer explosives related 
courses. However, these training facilities offer curricula that are 
narrowly focused along specific occupational requirements. For example, 
the HDS trains bomb technicians exclusively on basic electronics and 
how to render safe an explosive device. The NCETR training model will 
compliment these existing facilities through the delivery of training 
programs not available elsewhere and through applied research projects 
that will enhance the programs offered at other existing facilities.
    ATF provides specialized resources to train and assist other 
Federal, State, local and foreign law enforcement agencies in fire and 
explosives investigation, as well as explosives disposal. These 
training programs address all aspects of fire and explosives 
investigations including statutory and regulatory requirements, first 
responders, bomb technicians, post-blast reconstruction and 
investigation, forensic analysis, improvised explosives mixtures, IED 
electronics, explosives disposal, chemistry, and courtroom techniques.
    ATF has also partnered with DOD's Joint IED Defeat Organization to 
produce the Military Post Blast Investigation course provided to 
military EOD personnel preparing for deployment to combat. Currently, 
DOD funds ATF's detailee stationed at JIEDDO in Fort Irwin, California. 
DOD provides housing and per diem and finances all travel expenses 
related to JIEDDO training. ATF currently has one Special Agent 
Certified Explosives Specialist (SACES) on a not to exceed 1 year 
detail to Fort Irwin. Subsequent to the 1 year assignment, ATF will 
either PCS or detail another SACES to Fort Irwin. It is anticipated 
that DOD JIEDDO will fund any PCS costs, per the DOD/ATF MOU.
    ATF inspects the explosives industry to ensure compliance with 
storage, safety and security related requirements of federal law. ATF's 
relationship with the explosives industry also provides unique 
investigatory and technology resources to the Agency. ATF investigators 
are ideally positioned to thwart criminal activity at every level from 
the theft or illegal purchase of explosives to the interdiction and 
neutralization of these explosives.
    With this budget request, ATF will continue to utilize its 
expertise to help the explosives industry comply with federal law, 
prevent the unlawful acquisition of explosives, and promote industry 
and law enforcement partnerships to reduce public safety risks. ATF 
will also continue to draw upon its expertise in fire and explosives 
investigations to assist other Federal, State, local and foreign law 
enforcement agencies with training and investigations.
    Question. ATF trains canines to not only detect explosives but also 
to assist in the detection of accelerants used to start fires. Can you 
tell us more about the arson and explosives canine program?
    Answer. ATF trains accelerant detection canines for State and local 
fire departments, police departments, and State fire marshal's offices. 
Currently, there are 85 active accelerant detection teams in the United 
States. These canine teams are utilized in fire investigations to help 
identify potential points of origin started by ignitable liquids. Each 
year in the United States, deaths, injuries, and millions of dollars of 
property damage are caused by intentionally set fires. ATF-certified 
accelerant canines are an essential tool in detecting minute traces of 
substances which have been used to start fires. Accelerant detection 
canines also serve as a critical part of ATF's National Response Teams. 
These highly-trained canines serve side by side with trained fire 
investigators and forensic chemists to help solve some of the nation's 
costliest and deadliest arsons.
    ATF's canine programs produce extremely reliable, mobile, accurate, 
and durable explosives and accelerant detection tools, capable of 
assisting law enforcement and fire investigators with the escalating 
threat faced by communities worldwide. ATF has trained 519 explosives 
detection canines and 113 accelerant detection canines.
    In 1997, ATF began training explosives detection canine teams for 
State, local, and other Federal agencies. As of April 30, 2007, there 
are 120 active ATF-certified explosives detection canine teams working 
throughout the United States. Thirty-four of these teams include ATF 
special agent canine handlers, and 86 are explosives detection canine 
teams for other federal, State, and local agencies. ATF also trains and 
provides explosives detection canines for foreign countries, in 
conjunction with the U.S. Department of State, Office of Anti-Terrorism 
Assistance, to protect U.S. citizens and interests abroad. To date, ATF 
has trained 339 explosives detection canines for the following 17 
countries: Israel, Italy, Argentina, Cyprus, Greece, Chili, Egypt, 
Jordan, Malaysia, Australia, The Czech Republic, Poland, South Africa, 
Thailand, Bahrain, Qatar, and Mexico.
                                 ______
                                 
                 Questions Submitted to Karen P. Tandy
            Questions Submitted by Senator Patrick J. Leahy
                     dea state and local assistance
    Question. The Justice Department's Edward Byrne Memorial State and 
Local Law Enforcement Assistance Formula Grant Program (``Byrne 
grants'') helps state and local governments address the law enforcement 
needs in their own communities. Historically, a large share of this 
grant funding has targeted investigating and prosecuting major drug 
dealers, as well as fostering multi-state operations to support 
national efforts to reduce drug crimes.
    Since fiscal year 2002, funding for justice assistance programs in 
the Justice Department has fallen dramatically from $2.2 billion to 
$800 million--a cut of more than 63 percent. While reductions in crime 
and drug use rates over the past 10 years have been significant, they 
have leveled off in the past several years and, in some instances, have 
even begun to creep higher. The majority of the reductions occurred 
when state and local law enforcement assistance accounts were funded at 
high levels.
    State and local law enforcement have always been the lynchpins of 
community safety. Are you concerned that reducing federal involvement 
in Byrne assistance grants to state and local entities will lead to 
less effective law enforcement?
    Answer. Despite the reduction, we will continue to work side-by-
side with State and local law enforcement through our domestic offices 
and task forces. We will also continue to share intelligence with and 
provide training to our State and local partners.
    There are two narcotics task forces in the State of Vermont--the 
Vermont State Police Task Force and the DEA Task Force. The Vermont 
State Police Task Force is made up of three squads--Southern, 
Northeast, and Northwest. It is staffed as follows:
  --2 State Trooper positions funded by the State of Vermont;
  --6 State Trooper positions funded by the federal Meth Grant;
  --3 State Trooper positions funded by the Byrne Grant;
  --4 local Police positions funded by the Byrne Grant;
  --2 local Police positions funded by the federal Meth Grant; and
  --3 local Police positions funded by the State of Vermont.
    The DEA Task Force is located in the Northwest part of Vermont. It 
includes two HIDTA positions and is staffed as follows:
  --6 DEA Special Agents;
  --1 Burlington Police Detective;
  --1 State Trooper (included in the above 20 positions);
  --1 Essex County Sheriff's Deputy;
  --1 Lamoille County Sheriff's Deputy; and
  --1 Border Patrol Agent.
    Although more difficult, DEA will seek to maintain the necessary 
coverage throughout the State and service the needs of the communities 
as drug cases expand. In a state such as Vermont, DEA relies heavily on 
State and local counterparts for assistance, therefore a reduction in 
the Byrne Grant positions will likely impact State and local 
participation. However, DEA has a strong partnership with State and 
local law enforcement and these relationships will work to service the 
communities of Vermont with or without the positions. State and local 
law enforcement organizations have always demonstrated a commitment to 
working with DEA, and this will not change.
    DEA will continue work with its task force and the remaining 
Vermont State Police Task Force positions. Currently, the Southern 
Vermont State Police Task Force conducts narcotic investigations in the 
Southern part of the state. The work of this task force has been 
extremely helpful to DEA because drug trafficking organizations come 
from Massachusetts or New York, conduct business in Southern Vermont, 
and then return to their originating states. Once these individuals 
have been identified, the U.S. Attorney's office becomes involved, 
along with DEA, and the investigation continues back into the source 
States resulting in the indictments of these individuals and groups 
impacting Vermont.
    The Northeast Vermont State Police Task Force conducts 
investigations along the I-91 corridor and they also coordinate with 
the U.S. Attorney's office and with DEA on apprehending the cross state 
and cross Canadian border drug traffickers. The Northwest State Police 
Task Force conducts investigations within the same immediate area as 
the DEA Task Force. When investigations overlap the two task forces are 
adept at coordinating, however they seldom cross paths, demonstrating 
the amount of work to be done in the area.
    Question. In Vermont, state and local entities have long 
collaborated with the national government in fighting drugs. How can 
state and local anti-drug entities partner with DEA to curb drug 
trafficking when your fiscal year 2008 budget request reduces federal 
assistance to states in this area?
    Answer. Despite the elimination of the MET program in fiscal year 
2008, DEA will continue to work side-by-side with our State and local 
law enforcement partners by sharing intelligence, providing training, 
and participating in task forces. DEA assists State and local law 
enforcement in many ways, for example:
  --DEA's EPIC Open Connectivity Project provides web-based access to 
        approximately 1,800 Federal, State, and local partners on an 
        annual basis. Users can query and access law enforcement data 
        maintained by EPIC.
  --In fiscal year 2006, DEA shared $274 million in State and local 
        proceeds with State and local law enforcement, a 25 percent 
        increase over the $219 million shared in fiscal year 2005, 
        including a 40 percent increase in the funds shared with 
        Sheriffs. This level of sharing is expected to continue.
  --In fiscal year 2006, DEA trained over 41,000 S&L officers, 
        including over 1,000 in meth lab clean up and training.
  --By the end of 2008, DEA plans to complete a clandestine laboratory 
        training facility to better train more State and local 
        officers.
    DEA will also continue to support State and local law enforcement 
through our domestic offices and task forces. DEA leads over 200 State 
and local task forces, including over 1,600 DEA Special Agents and over 
2,100 State and local task force officers, all of whom are dedicated 
full time to address drug trafficking, including trafficking in our 
local communities.
                        prescription drug abuse
    Question. In December 2006, the University of Michigan released a 
national survey, called ``Monitoring the Future''--the largest and most 
in-depth survey of youth drug use in the nation measuring drug, alcohol 
and cigarette use and related attitudes among teenagers. The study 
revealed, among other things, that there was a thirty percent increase 
in the use of the prescription drug OxyContin last year. I understand 
that in April of 2001 the DEA implemented a comprehensive National 
Action Plan to reduce the diversion and abuse of OxyContin.
    How many DEA investigations and arrests have led to successful 
prosecutions in OxyContin cases since 2001?
    From April 2001, when the OxyContin National Action Plan was 
implemented, to the end of fiscal year 2006, DEA initiated 970 
OxyContin (both brand name and generic) investigations and made 912 
OxyContin-related arrests. Though DEA databases do not comprehensively 
track prosecutions, the majority of DEA arrests result in successful 
prosecutions. The following are two examples:
  --On July 10, 2006, Thomas Merrill, MD was sentenced in the Northern 
        District of Florida in Pensacola, to life imprisonment on six 
        counts of over-prescribing OxyContin and other controlled 
        pharmaceuticals resulting in the deaths of five individuals. He 
        was also sentenced to concurrent twenty, ten, and five year 
        terms of imprisonment on an additional 92 counts including wire 
        fraud and defrauding health care benefits programs.
  --On September 1, 2004, Fred J. Williams, MD was sentenced in the 
        Northern District of Florida to life imprisonment following 
        conviction on 94 counts of drug offenses arising out of his 
        illegal dispensing of OxyContin. Williams was writing 
        prescriptions for known drug abusers using several variations 
        of a patient's name in an apparent attempt to avoid attracting 
        attention at local pharmacies. Williams wrote over 600 
        prescriptions to 150 people, none of whom were identified as 
        patients. At the time of sentencing, the judge admonished Dr. 
        Williams for wreaking havoc on the community and destroying 
        lives.
    Question. In 2002, the Justice Department Inspector General found 
that despite the widespread problem of controlled pharmaceutical 
diversion and abuse, ``the DEA had been slow to commit resources to 
address this problem.'' In a July 2006 follow up review, the Inspector 
General found that ``from fiscal year 2002 to fiscal year 2005, the DEA 
increased the percentage of time that diversion investigators spent 
investigating Internet diversion from 3 percent to 11 percent.''
    What percentage of time has DEA diversion investigators spent 
investigating Internet diversion from fiscal year 2005 to the present?
    Answer. Since the 2002 OIG report, DEA has worked diligently to 
address the growing problem of pharmaceutical drug abuse in the United 
States. DEA attempts to leverage all of its resources to address this 
serious problem. In addition to having Diversion Investigators conduct 
Internet and other types of diversion cases, Special Agents, 
Intelligence Analysts, and Task Force Officers routinely work on these 
types of investigations. DEA also prides itself in working shoulder-to-
shoulder with our state and local counterparts on all investigations 
including diversion investigations.
    In fiscal year 2005, 11.4 percent of Diversion Investigator (DI) 
work hours were spent on Internet cases. During the first half of 
fiscal year 2007, 16.8 percent of DI work hours were spent on Internet 
cases, an increase of 47 percent over fiscal year 2005.
    In addition to investigative work, DEA has devoted significant 
resources to targeting efforts using ARCOS and SearchPoint, taking 
administrative action, such as Immediate Suspensions and Show Cause 
Orders, on pharmaceutical wholesalers and distributors found to be 
supplying Internet pharmacies. Further, DEA is also working closely 
with legitimate Internet-related businesses, such as credit card 
companies, express parcel carriers, and Internet Service Providers, to 
solicit their cooperation in shutting down illegal Internet pharmacies.
    Question. In its 2006 report, the Inspector General examined 
several investigative tools that are part of DEA's overall operational 
strategy, including the Online Investigations Project (OIP), telephone 
and online hotlines, undercover equipment, and training in conducting 
Internet diversion investigations. The Inspector General found that 
although the OIP has become a valuable investigative tool, ``it cannot 
automatically identify web sites with the highest volume of suspect 
pharmaceutical sales as originally intended.''
    Are you concerned that, contrary to the original intent of OIP, DEA 
may not possess the resources or capacity to identify rogue online 
pharmacies with the highest volume of suspect sales?
    Answer. Although the OIP has not provided DEA the originally 
intended capabilities to proactively search the Internet and identify 
major violators, it is used daily to provide background information on 
suspect websites. In addition, DEA analysts and diversion investigators 
have demonstrated a limited capability to produce more detailed link 
analyses of groups of related websites.
    DEA has recognized and acted upon the continuing requirement to 
proactively and efficiently search the Internet and identify illicit 
online pharmacies that are selling the greatest amounts of controlled 
pharmaceuticals. To this end, DEA in March of this year initiated a 
contract with an Internet search and analysis company to provide this 
capability. Although the identity of this company cannot be included in 
this response for reasons of investigative confidentiality, the company 
has over the past two years developed an excellent reputation providing 
Internet search and analysis services to leading credit card companies, 
Internet companies, and major banks for the purpose of enforcing 
company due diligence responsibilities in the field of Internet 
pharmaceutical sales, as well as several other areas of illegal 
commerce over the Internet. In particular, the company has been the 
leading provider of Internet search and analysis services to a 
coalition of financial companies working closely with the National 
Center for Missing and Exploited Children to identify and refer for law 
enforcement investigation Internet purveyors of child pornography--a 
more difficult Internet investigative challenge but also one that 
shares significant common traits with illicit Internet sales of 
controlled pharmaceuticals.
    This contract for Internet search and analysis services includes a 
four-month initial performance period with options for an additional 
eight months as well as a subsequent year. The contractor recently 
provided DEA an initial list of six prospective website targets along 
with an initial list of affiliated websites. These targets have already 
been evaluated by our Special Operations Division and forwarded to 
several DEA Field Divisions. Significantly, this contract requires, and 
the contractor has expressed confidence in its ability to deliver, 
identification of the leading Internet controlled pharmaceutical 
trafficking networks. This includes all associated payment websites, 
affiliate or portal websites, registration, web hosting, and server 
identifications, as well as key financial links including payment 
processors and merchant banks that provide website operators access to 
major credit card networks. If successful, this contract by March of 
2008 will have conclusively identified and mapped out the Internet 
``footprint'' of the largest Internet controlled pharmaceutical 
trafficking organizations and DEA will have initiated investigations 
against those same organizations.
    Question. Do you believe that a DEA or a nongovernmental 
organization should regularly search the Internet to identify these 
websites and other locations that offer to sell controlled substances 
without a prescription?
    It is vital that the DEA and relevant private sector companies work 
together to proactively search the Internet to identify websites that 
are illegally selling controlled pharmaceuticals. Because the Internet 
is constantly changing, the search for illicit websites is inherently 
complex and must be undertaken on a proactive basis, not reactive.
    Question. Since 2002, the DEA has established telephone and online 
hotlines for reporting suspicious Internet pharmacies. The Inspector 
General's 2006 report found that ``these hotlines have yielded few 
leads that resulted in diversion investigations.'' Equally troubling, 
the Inspector General found that while the DEA has started to provide 
undercover equipment to its diversion groups, ``as of May 2006 most 
diversion groups still did not have this equipment.''
    Are you concerned that DEA lacks the resources to ensure that its 
intelligence, technological, and investigative tools operate 
effectively?
    Answer. DEA is working hard to integrate and optimize its 
intelligence, technology, and investigative resources for Internet 
pharmaceutical investigations. The technological and analytical 
challenges posed by Internet pharmaceutical investigations are many and 
complex, and have required DEA to reach out to the private sector for 
Internet expertise for search, analysis, and training support. 
Moreover, much of the available intelligence for identifying and 
targeting violators resides in the private sector among key industry 
groups whose services are used by online traffickers of controlled 
pharmaceuticals. This has placed a premium on fostering effective 
working relationships with leading Internet, financial, and parcel 
delivery companies. In this time of constrained budgets, both manpower 
and funding limitations directly impact Internet investigations, which 
require unusually large commitments of these resources.
    DEA has provided all field divisions with undercover credit card 
accounts in order to make online purchases of controlled 
pharmaceuticals for use as evidence in Internet investigations. DEA has 
also deployed undercover Internet workstations to all domestic field 
divisions.
    Question. What percentage of diversion investigators receive 
specialized training that can prove useful for conducting Internet 
investigations?
    Answer. As of March 1, 2007, 369 of the 520 (71 percent) on-board 
Diversion Investigators have completed Internet training conducted by 
DEA's Special Operations Division (SOD). Additional training classes 
have been scheduled during the remainder of fiscal year 2007. DEA is 
also developing an Advanced Internet Investigations course that is 
scheduled to begin in August of 2007. DEA has also added two Financial 
Techniques courses into the fiscal year 2007 training schedule that is 
designed to provide employees with the skills and knowledge to enhance 
their investigative skills to conduct financial investigations. DEA 
will also provide Diversion Investigators with courses on Complex 
Conspiracy Investigations.
    Question. I am concerned that curbing Internet prescription drug 
abuse may take collaboration between law enforcement and private sector 
companies (i.e., credit card companies, payment systems, Internet 
Service Providers, common carriers, etc.)
    What current methods of collaboration with private sector entities 
does DEA use to combat rogue online pharmacies?
    Answer. For the past two years, DEA has actively developed 
relationships with leading financial, Internet, and express parcel 
delivery companies whose services are used by Internet controlled 
pharmaceutical trafficking organizations. The purpose of this outreach 
has been threefold: (1) to raise awareness of the growing problem of 
pharmaceutical diversion via the Internet; (2) to elicit voluntary 
efforts to restrict legitimate business services from being used by 
illicit Internet controlled pharmaceutical traffickers; and (3) to 
identify potential sources of data maintained by businesses that may 
aid in targeting enforcement efforts against the largest illicit 
Internet drug trafficking organizations.
    These relationships provide an opportunity for government and the 
private sector to reach a better understanding of relevant federal laws 
and explore areas of cooperation and voluntary industry action to curb 
the expanding illicit sale of controlled pharmaceuticals over the 
Internet. The level of cooperation enjoyed by DEA with the various 
industries involved with Internet pharmacies is excellent. They 
understand the gravity of the problem and have been extremely 
cooperative with DEA's inquiries. These relationships are maturing even 
further around a systematic industry-based Internet search and analysis 
effort that will incorporate selected data inputs from key Internet, 
financial, and parcel carrier companies to proactively identify and 
target the largest Internet controlled pharmaceutical trafficking 
organizations. A coalition of leading financial companies is 
spearheading this effort.
    Question. Information sharing between private sector entities and 
the DEA may be critical to preventing online prescription drug abuse. 
While the number of occasions may be limited, the willingness for 
private sector entities to share information with DEA about locations 
to sell pharmaceuticals illegally and to act upon them may be 
diminished by the threat of law suits.
    Do you think that the private sector can play an important role in 
assisting DEA reduce online drug abuse?
    Answer. Yes. Private sector involvement is critical for two 
reasons. First, the private sector--most especially the Internet, 
financial, and express parcel delivery companies whose services are 
used by Internet traffickers of controlled pharmaceuticals--must 
establish rigorous business practices to preclude this illicit use of 
their services and then rigorously enforce those standards through 
internal fraud prevention efforts. Second, these same companies, which 
all rely intensively upon the Internet for their business, possess 
invaluable data needed to proactively identify, target, and investigate 
violators.
    Question. Do you support immunity from civil or criminal action for 
private sector entities that mistakenly identify websites in good 
faith? And do you support immunity from civil or criminal actions for 
private sector entities that refuse to do business with any 
organization mistakenly identified in good faith as offering to 
illegally sell a controlled substance?
    Answer. Yes, DEA would support legislation that furthers the 
ability of private sector companies to deny services to other companies 
involved in suspect activities, while minimizing liability for any 
mistaken actions made in good faith. It is vital that relevant 
Internet, financial, and parcel delivery companies aggressively police 
their own operations in this area of illegal commerce. This support 
from the private sector strengthens DEA's overall enforcement strategy. 
Private sector entities are acutely aware of their legal liability for 
denying services to suspect websites whose operators have not been 
legally convicted. For example, MasterCard has in the past two years 
denied services to several hundred suspect pharmaceutical website 
operators working through the merchant banks that issued the credit 
card retail accounts. FedEx suspended truck deliveries of suspect 
packages containing pharmaceuticals within portions of eastern Kentucky 
when it became apparent that illicit Internet sales of controlled 
pharmaceuticals had reached epidemic proportions in that part of the 
state. In general, businesses have the legal authority to suspend their 
services to clients that violate internal business practices codified 
in their contracts with clients.
                                cocaine
    Question. The U.S. Sentencing Commission has expressed concerns 
about the amount of low-level drug offenders being dealt with 
excessively, particularly in the area of crack cocaine. In May 2002, 
the Commission found that in fiscal year 2000, 73 percent of all 
federal crack convictions were brought against low-level offenders, and 
only 6.1 percent of all federal crack convictions were brought against 
high-level dealers in crack cocaine cases.
    For powder cocaine, a similar disparity exists. The Commission's 
May 2002 report found that only 6.7 percent of powder cocaine cases 
were brought against high level offenders, while 68 percent of powder 
cocaine cases were brought against the lowest-level offenders.
    Are you concerned that the federal crack powder laws target ``small 
fish'' instead of drug kingpins of organized drug cartels?
    Answer. Federal statutes do not target ``small fish'' instead of 
large scale traffickers and organized cartels. Federal statutes carry 
strong penalties for trafficking in meaningful amounts of cocaine 
powder and cocaine base. Individuals who are first time offenders and 
are not leaders or managers of a drug organization are eligible for 
more lenient treatment pursuant to the ``safety valve'' provisions of 
18 U.S.C. 3553(f). Individuals who deal in large amounts of cocaine 
powder or cocaine base are subject to appropriately long sentences. An 
individual who deals in at least five kilograms or more of cocaine 
powder is subject to a mandatory minimum sentence of ten years, as is 
an individual who deals in at least 50 grams of cocaine base (crack). 
In addition, leaders and organizers of drug organizations are subject 
to the severe penalties of 21 U.S.C. 848, the Continuing Criminal 
Enterprise Statute, which carries penalties of from 20 years to life 
imprisonment.
    Question. Does the DEA focus its drug interdiction efforts on high-
level traffickers? Please explain.
    Answer. DEA is committed to bringing those organizations involved 
in the illicit growing, manufacturing, diversion, laundering of 
proceeds, or distribution of controlled substances to the criminal and 
civil justice system of the United States, or any other competent 
jurisdiction. The DEA focuses a significant amount of its resources on 
attacking Priority Target Organizations (PTOs), which are major drug 
supply and money laundering organizations operating at the 
international, national, regional, and local levels having a 
significant impact upon drug availability.
    In addition, DEA works closely with key drug enforcement programs 
such as the Organized Crime Drug Enforcement Task Force (OCDETF) 
program to accomplish its mission. The OCDETF member agencies 
identified international command and control organizations representing 
the most significant international drug trafficking organizations 
threatening the United States. These targets are referred to as 
Consolidated Priority Organization Targets (CPOTs). Efforts to disrupt 
and dismantle CPOT and PTO organizations are primarily accomplished 
through multi-agency investigations mostly directed by DEA. In fiscal 
year 2006, DEA participated in approximately 90 percent of all OCDETF 
cases, and had the lead or co-lead in approximately 80 percent of 
OCDETF investigations.
    DEA also participates in enforcement-related programs such as 
specialized training for state and local law enforcement designed to 
improve their abilities to enforce state drug laws and target and 
dismantle street lead drug trafficking organizations and demand 
reduction programs designed to educate citizens concerning the dangers 
of drugs and emerging drug trends. These programs are aimed at reducing 
the availability of and demand for illicit controlled substances.
    Question. At the November 14, 2006 hearing before the Sentencing 
Commission, DEA Deputy Assistant Administrator for the Office of 
Diversion Control, Joseph T. Rannazzisi, testified that cocaine enters 
the United States in the form of powder cocaine, and powder cocaine is 
converted into crack cocaine once the powder cocaine reaches the street 
level. According to Mr. Rannazzisi, crack cocaine is usually trafficked 
at the street level.
    I understand that the DEA believes it is targeting street level 
crack or powder dealers to work up the chain to higher level dealers. 
What are the largest amounts of crack cocaine that the DEA has 
confiscated during a single drug arrest in the last five years?
    Answer. DEA's database does not distinguish between ``crack'' 
cocaine and cocaine base because ``crack'' is a form of cocaine base. 
However, DEA does target street level drug dealers with the goal of 
working up the chain to the higher level trafficking organizations. DEA 
focuses on attacking the organizations which are the major drug supply 
and money laundering organizations operating at the international, 
national, regional, and local levels having a significant impact upon 
drug availability.
    For example, in May of 2006, the Seattle Field Division completed 
an eight-month investigation focused on decreasing the growing problem 
of ``open-air'' drug markets in the East and West precincts of Seattle. 
Over the course of this deployment, many individuals were arrested for 
selling small quantities of drugs to undercover officers. The Seattle 
Filed Division's Special Agent in Charge, Rodney Benson, stated that 
``those street-level cases have resulted in a significant number of 
major, long-term investigations that we're working on right now,'' 
which focus primarily on those individuals high-up on the drug 
distribution food chain. This investigation resulted in the disruption 
of two drug trafficking organizations; 311 arrests; and the seizure of 
approximately .41 pounds of powder cocaine, 3.46 pounds of crack 
cocaine, .02 pounds of methamphetamine, 3.56 pounds of heroin, .21 
pounds of marijuana, .46 pounds of steroids, .14 pounds of ecstasy, and 
.21 pounds of miscellaneous prescription pills, and over $150,000 in 
assets.
    Question. What are the largest amounts of powder cocaine that the 
DEA has confiscated during a single drug arrest in the last five years?
    Answer. The largest amount of powder cocaine that DEA has seized 
during the last five years was on November 5, 2004 in Key West, Florida 
for 11.9 metric tons of cocaine. DEA's database does not tell us if 
this occurred during a single drug arrest though, so potentially there 
could have been multiple arrests in this case that resulted in this 
amount of seized cocaine.
    Even larger seizures have been made by agencies that work with DEA. 
On March 17, 2007, the U.S. Coast Guard, acting on information provided 
by DEA and Panamanian law enforcement, seized approximately 22 metric 
tons of cocaine aboard a Panamanian flagged motor vessel off the coast 
of Panama. This record-breaking seizure was the result of actionable 
intelligence provided by Panamanian law enforcement officials and close 
collaboration through DEA's multi-agency cocaine interdiction program, 
Operation Panama Express.
    Previously, the largest cocaine seizures by the Coast Guard were: 
13.6 metric tons from the stateless-vessel Lina Maria, on Sept. 17, 
2004; and 11.9 metric tons from the Cambodian-flagged vessel Svesda 
Maru on May 1, 2001.
    Question. Crack is the only drug for which the first offense of 
simple possession can trigger a federal mandatory minimum sentence. 
Under 21 U.S.C.  844, possession of 5 grams of crack will trigger a 5 
year mandatory minimum sentence.
    Would reforming  844 allow the DEA's anti-drug efforts more 
effective by focusing its resources on preventing drug trafficking by 
drug cartels instead of wasting precious time and resources on low-
level street dealers?
    Answer. As stated in the answer to the question above, DEA already 
focuses its resources ``on preventing drug trafficking by drug 
cartels.'' Increasing the amount of crack that will trigger a five-year 
mandatory minimum sentence would not augment DEA's ability to dismantle 
drug cartels. The value of mandatory minimum sentences such as the 
five-year mandatory minimum for crack cocaine is that they facilitate 
DEA's ability to gain cooperation. A recent example is an important 
investigation of a DEA Atlanta Division crack cocaine trafficking 
organization that was built upon purchasing just a few ounces of crack 
cocaine from several mid-level members of the organization. Some of the 
original cooperating sources were working to lessen their sentences for 
selling user amounts of crack cocaine and other drugs. The 
investigation resulted in the arrest of more than 15 violators and the 
seizure of cash, securities and property in excess of one million 
dollars. The leader of the organization entered a plea of guilty and 
received 20 years in jail. The guilty plea was obtained due to the high 
minimum mandatory sentences that his subordinates were facing for the 
sales of ounce quantities of crack cocaine; they were motivated to 
cooperate and potentially testify against their boss.
    Please note that while DEA believes that mandatory minimum 
sentences are a valuable tool in gaining cooperation and incapacitating 
dangerous drug traffickers and organizations, we do not agree that 
Federal law enforcement officers or prosecutors are devoting any 
measurable amount of resources to investigating or prosecuting cases of 
possession under 21 U.S.C.  844. The fiscal year 2005 statistics from 
the United States Sentencing Commission show that only 0.8 percent of 
powder cocaine cases were for simple possession, and only 1.1 percent 
of crack cases involved a simple possession charge. The percentages of 
actual drug trafficking charges in 2005 for powder and crack cocaine 
were 98.4 and 95.3, respectively.
                       international drug issues
    Question. Last year, the United Nations Office on Drugs and Crime 
(``UNODC'') reported that there has been a surge in opium cultivation 
in Afghanistan that is fueling the insurgency in that country. 
According to the report, opium production in Afghanistan has increased 
59 percent over last year, and in the southern region where Taliban 
insurgents have intensified their attacks on Afghan government and U.S. 
forces, opium cultivation has increased by 162 percent.
    What steps is the DEA taking to address the growing opium trade in 
Afghanistan?
    Answer. DEA is working to help the Government of Afghanistan 
establish the drug enforcement institutions and capabilities they must 
have to enforce the rule of law. This means successfully identifying, 
disrupting, and dismantling major drug trafficking organizations that 
fuel and profit from the narco-economy.
    Out of the six major Drug Trafficking Organizations (DTO) heads 
targeted by Operation Containment, four have been arrested to include 
Haji Bashir Noorzai and Haji Baz Mohammad who are being prosecuted in 
the United States. The operation has also led to significant seizures 
of narcotics and precursor chemicals and the dismantlement and 
disruption of organizations involved in the Southwest Asian drug trade.
    The four other major DTO heads targeted by Operation Containment 
are Shabaz Khan, who was arrested in the United Arab Emirates and is 
currently on trial, Urifi Cetinkaya, who is serving a prison sentence 
in Turkey, Cumhur Yakut, who has been indicted, and Haji Juma Khan, who 
has not yet been indicted.
    In October 2005, Haji Baz Mohammad--Drug Kingpin and CPOT--was 
extradited to the United States. This marked the first-ever extradition 
between the United States and Afghanistan.
    DEA's Foreign-deployed Advisory Support Teams (FAST) advise, train, 
and mentor their Afghan counterparts in the National Interdiction Unit 
(NIU) of the Counter Narcotics Police--Afghanistan (CNP-A), and 
directly augment the Kabul Country Office in conducting bilateral 
investigations to identify, target, and dismantle transnational drug 
trafficking operations in the region. The five FAST each consist of a 
Group Supervisor, four Special Agents, and one Intelligence Research 
Specialist.
    DEA has trained the NIU's 126 law enforcement officers in the 
conduct of drug enforcement operations.
    Question. Does DEA have the resources to be effective in curbing 
the Afghan opium trade? If yes, how are those resources being allocated 
and utilized? If not, where are increased resources needed?
    Answer. DEA's base funding for FAST program is $8.3 million, which 
is sufficient to fund continuing deployments to Afghanistan and refresh 
equipment.
    The following support for DEA's operations in Afghanistan is 
provided by DOD:
  --DOD is providing basing support at Bagram Air Base for DEA FAST 
        members and facilities for the FAST teams remaining in the 
        Continental United States (CONUS) at the Marine Corps Base at 
        Quantico, Virginia; a hangar and fuel to support the DEA King 
        Air 350 twin-engine turboprop aircraft currently in 
        Afghanistan; two DEA King Air maintenance personnel in Kabul; 
        and facilities to protect, house, feed, and operate at the 
        National Interdiction Unit (NIU) site in Kabul, Afghanistan.
  --DOD is providing transportation support for the NIU, which is the 
        Afghan counterpart to DEA and the Afghan unit with whom the 
        FAST conducts counternarcotics operations. The NIU received its 
        basic training from DOD and currently has more than 100 
        personnel. DOD provides transportation for DEA FAST personnel 
        and supporting equipment from CONUS to Afghanistan and back.
  --DOD is acquiring thirteen (13) MI-17 helicopters for the Afghan 
        Ministry of Interior to support the Counter Narcotics Police--
        Afghanistan (CNP-A), NIU, and DEA Special Agents.
  --DOD is providing operational and logistical support and assistance 
        through the U.S. Central Command (CENTCOM) and elements of the 
        North Atlantic Treaty Organization (NATO) International 
        Security Assistance Force (ISAF).
  --DOD is providing investigational support by providing Ring Flights 
        to DEA Special Agents. Since February 2005, DOD has provided 26 
        Ring Flights to DEA. These ring flights allow us to gather 
        counter-narcotics intelligence, interview confidential sources 
        and other sources of information in the outlying provinces, 
        meet Afghan law enforcement counterparts to plan and coordinate 
        investigations, meet local and provincial Afghan officials, and 
        travel to Forward Operating Bases (FOBs) to meet Afghan 
        counterparts and U.S. Military personnel.
  --DOD is constructing significant infrastructure for the NIU, 
        including facilities to protect, house, feed, train, and 
        operate. Facilities are also under construction for the 
        Counter-narcotics Judicial Center, which will provide a secure 
        location to detain and prosecute narcotics traffickers. DOD 
        also provided weapons, night vision devices, and other 
        equipment to the NIU.
  --DOD provides DEA FAST training at military installations in the 
        United States prior to deployment.
  --DOD has provided communications equipment for FAST command and 
        control in Afghanistan. Additional communications equipment is 
        being provided to the NIU.
  --DOD has been actively working with the DEA, Department of State, 
        U.S. Embassy Kabul, and Afghan Ministry of Interior officials 
        to fund the expansion of the CNP-A.
  --DOD has provided 4.5 million rounds ammunition for FAST and the 
        NIU.
  --DOD has provided contract medical, communications, logistical, and 
        intelligence support to DEA and the NIU on a daily basis.
    DEA could not maintain its presence in Afghanistan without the 
support it receives from DOD. Unfortunately, DEA operations have been 
severely limited due to lack of air mobility and security.
    As a new and non-standard aircraft acquisition program, the MI-17 
Helicopter Program has suffered setbacks and benefited from product 
improvements as they have been fielded. As a result the program is 
behind its estimated operational target of CY 2005. As of May 2007, 
none of the 6 MI-17 helicopters have flown law enforcement operations 
with CNP-A/NIU officers or DEA Special Agents.
    Three Afghan pilots' classes have graduated from DOD training 
provided at Fort Bliss, Texas however aircraft delays have made it 
impossible for the Afghan pilots to keep their flight skills current. 
They are currently being checked by instructor pilots, prior to being 
qualified to fly pilots in command. Until that time, all crews will be 
mixed U.S./Afghan crews.
    Finding permanent space for DEA's Afghanistan based King Air 350 
and a second King Air, currently being modified for aerial 
surveillance, has proven to be a challenge. DEA and DOD are currently 
working to secure permanent space at the Bagram Airfield. If 
unsuccessful, the removal of the King Airs would significantly 
undermine DEA enforcement efforts.
    Question. I am concerned whether the price and availability of 
cocaine has changed significantly as a result of DEA's international 
eradication efforts. Our country has given $5.4 billion in aid to 
support Plan Colombia. Yet, if you compare the price and availability 
of cocaine now to the price and availability of cocaine in 2001--at the 
start of Plan Colombia--there has been no significant change in either 
the availability or the price of cocaine on America's streets. In fact, 
according to ``Connecting the Dots: ONDCP's (Reluctant) Update on 
Cocaine Price and Purity,'' an April 2007 report by the Drug Policy 
Program of the Washington Office on Latin America, preliminary U.S. 
government data indicates that cocaine's price per pure gram on U.S. 
streets fell in 2006, while its purity increased.
    These latest estimates, continuing a 25-year trend, suggest that 
cocaine supplies are stable or even increasing. Congress was told that 
Plan Colombia would cut cocaine production by half, but it obviously 
has failed to do that. Do you believe it is now time for DEA to rethink 
its international eradication strategy?
    Answer. DEA does not have an international eradication strategy for 
Colombia. The U.S. Department of State's Narcotics Affairs Section 
(NAS) is responsible for the aerial eradication program in Colombia. 
The mission of DEA's Bogota Country Office and Cartegena Resident 
Office is to conduct bilateral investigations and enforcement 
operations to reduce the drug supply by targeting, disrupting or 
dismantling the most wanted international drug trafficking 
organizations impacting the United States. Thus, DEA's operations in 
Colombia are concerned with interdiction rather than eradication.
    Question. President Uribe has extradited about 400 people indicted 
for drug crimes in the United States, which I commend. However, none of 
them are top paramilitary leaders nor, with a couple of exceptions, are 
any of them FARC leaders. As you indicated at the last budget hearing 
in April 2006, it is one matter to indict someone and another to 
extradite and convict them.
    Do you support the suspension of extradition of paramilitary 
leaders who have been responsible for the shipment of tons of cocaine 
to the United States?
    Answer. If Autodefensas Unidades de Colombia (AUC) members 
currently involved in the peace process continue to traffic drugs and/
or commit other crimes, DEA and the Department of State believe they 
should be extradited. Although suspension of extraditions is not 
consistent with the U.S. government's goal of bringing violent, 
transnational criminals to justice, such a peace plan would further our 
interests of attaining political stability throughout the region and 
strengthening the democratic institutions of Colombia. The Government 
of Colombia has indicated to DEA that if an AUC member is indicted in 
the United States for drug trafficking since the time they surrendered 
to the Justice and Peace process, then that member is subject to 
extradition.
    Although the Uribe Administration continues to support extradition 
requests by the United States for paramilitary AUC members, there is a 
concern that it may be difficult for the Administration to follow 
through with the extradition of some key AUC leaders, particularly 
those who are critical to the peace and demobilization process. While 
engaged in the peace and demobilization process, the Colombian 
Government has suspended their extradition warrants. DEA anticipates 
that if these individuals comply with the Justice and Peace Law, they 
will receive a sentence of between 5-8 years and the extradition 
warrants will continue to be suspended. Under Colombian Law 975, known 
as the Justice and Peace Law, the demobilized members of the AUC who 
have committed massacres, drug trafficking, and other crimes are 
eligible for reduced sentences if they comply with the requirements of 
confessing to their crimes and making restitution to their victims. 
However, the Uribe administration has assured the U.S. Embassy that if 
there is evidence that an individual is continuing to engage in drug 
trafficking and other illegal activities after the July 25, 2005 
signing date, they will be removed from the process and their 
extradition warrant will again become active.
    Question. Has the DEA or the State Department told the Colombian 
Government that the United States agrees with these suspensions? Has 
the DEA or State Department told the Colombian Government that the 
United States disagrees?
    Answer. Please see DEA's response to question above.
    Question. What are the total numbers of FARC indictees that have 
been actually extradited?
    Answer. Since the amendment to the Colombian Constitution on 
December 17, 1997, the Colombian Government has extradited 539 
fugitives to the United States. Of that number, 7 were FARC members and 
8 were AUC members.
    Of the 50 FARC indictments unsealed on March 22, 2006, three have 
been captured and are awaiting extradition. To date, none have been 
extradited.
                            methamphetamine
    Question. According to a November 2006 report by the U.S. National 
Drug Intelligence Center, cartel labs in Mexico and California now 
produce about 80 percent of the methamphetamine in the United States.
    What steps has DEA taken to decrease the amount of methamphetamine 
produced in Mexico?
    Answer. DEA is working hard with the Government of Mexico to target 
the criminal organizations involved in the diversion of precursor 
chemicals and the producing and trafficking of methamphetamine. Mexico 
has imposed import quotas tied to estimates of national needs. The 
Mexican Government limited pseudoephedrine, ephedrine, and combination 
product importation permits to 70 tons during 2006; this is a reduction 
of 53 percent from the 2005 level of imports (150 tons). This quota has 
made it more difficult for traffickers to obtain precursor chemicals. 
Prices have increased and traffickers have been forced to resort to 
traditional diversion methods, including smuggling and the use of third 
countries to procure their chemicals. In addition, intelligence 
indicates that traffickers have also turned to alternate production 
methods for methamphetamine and the apparent use of substitute 
chemicals as the traditional precursors are becoming more difficult to 
obtain. Mexico has discussed revising their quota downward even further 
in 2007.
    In May 2006, at the National Methamphetamine and Chemicals 
Initiative (NMCI) Strategy Conference in Dallas, Attorney General 
Gonzales announced important new anti-methamphetamine domestic 
initiatives, as well as new partnerships between the United States and 
Mexico in fighting methamphetamine trafficking. These initiatives will 
improve enforcement and information sharing, increase law enforcement 
training, and increase public awareness both domestically and 
internationally. Since this announcement, methamphetamine enforcement 
teams have been formed on both sides of the border and DEA, with the 
assistance of the U.S. Department of State, has donated eight 
refurbished clan lab trucks to Mexico.
    Additionally, DEA and the Department of State, Bureau of 
International Narcotics and Law Enforcement Affairs trained over 2,000 
Mexican officials in fiscal year 2006 on a variety of investigative, 
enforcement, and regulatory methods related to methamphetamine 
trafficking and manufacturing. This training included instruction on 
clandestine laboratory investigations, precursor chemical 
investigation, and drug identification. As a result of this training, 
Mexican law enforcement officials have had significant success in 
identifying labs.
    In fiscal year 2006, DEA also trained over 41,000 State and local 
law enforcement officers, including over 1,000 in how to conduct 
investigations and dismantle seized methamphetamine labs. By the end of 
2008, DEA also plans to complete a clandestine laboratory training 
facility to better train more state and local officers.
    DEA has expanded the role of its Clan Lab Enforcement Teams to 
target Mexican methamphetamine trafficking organizations. These teams 
use their lab expertise to trace chemicals, finished methamphetamine, 
and drug proceeds to drug trafficking organizations in the United 
States and Mexico. These teams also work to identify and dismantle 
U.S.-based methamphetamine transportation and distribution cells.
    DEA has also developed an intelligence collection program, 
Operation White Fang, to assist in the identification and targeting of 
organizations responsible for producing and trafficking methamphetamine 
across the entire Southwest Border. The operation focuses particularly 
on the groups responsible for the drug related violence facilitated by 
the major Mexican cartels operating along the U.S./Mexico border. In 
the fiscal year 2008 President's budget, DEA requests $325,000 for this 
operation.
    Question. Recent reports show an increase in drug gang activity in 
the area of methamphetamine and over-the-counter medicines. I am 
concerned that this may be leading to an increase in violence in some 
communities.
    Has DEA taken any steps to address this situation?
    Answer. Recently, DEA has seen an increase in cases involving 
violent organized gangs, such as MS-13 and La Familia. Many of these 
gangs are typically, poly-drug and poly-criminal opportunists. Some of 
them are involved in trafficking various quantities of methamphetamine 
and precursor chemicals in states such as California. Historically, 
domestic motorcycle gangs, such as the Hell's Angels, have been the 
primary gangs involved in the manufacturing and trafficking of 
methamphetamine. As part of its mission, DEA targets violent gangs 
involved in drug trafficking activity, such as the Hell's Angels, Latin 
Kings, Bloods, Crips, Mexican Mafia, and Gangster Disciples.
    To handle this problem DEA participates in a number of anti-gang 
initiatives with other law enforcement components, including the 
National Gang Intelligence Center, ATF's Violent Crime Impact Teams 
(VCIT) and Project Safe Neighborhoods, FBI's Safe Streets and Safe 
Trails Task Forces, DOJ's Weed and Seed Program, and the Attorney 
General's Anti-Gang Coordination Committee \1\ (GangTECC) which 
oversees all of the above listed programs.
---------------------------------------------------------------------------
    \1\ In the fiscal year 2008 President's budget, DEA is requesting 1 
Special Agent position in support of Gang TECC.
---------------------------------------------------------------------------
    Question. According to a March 25, 2007, article in the USA Today, 
``reports of candy-flavored methamphetamine are emerging around the 
nation stirring concern among police and abuse prevention experts that 
drug dealers are marketing the drug to younger people.'' The article 
reports that among the new flavors are strawberry, known as 
``strawberry quick,'' chocolate, cola, and other sodas. And, the 
article reports, that a DEA agent reported a red meth that has been 
marketed as a powdered form of energy drink.
    Given these recent reports, how widespread has flavored crystal 
meth products become?
    Answer. With the continual stream of negative press regarding 
methamphetamine, drug traffickers are trying to lure new customers by 
making meth seem less dangerous. Since the early 1980s there have been 
regional occurrences of different colors and better tasting 
methamphetamine. ``Strawberry Quick'' and other flavors are just the 
latest of the trends in the marketing of methamphetamine. According to 
intelligence, the flavored crystals are available in California, 
Nevada, Washington, Idaho, Texas, New Mexico, Missouri and Minnesota. 
Normally, methamphetamine is white or brownish and bitter-tasting. 
Strawberry Quick may be popular among new users who snort 
methamphetamine because the flavoring can cut down the taste. 
Traffickers are savvy marketers, and they continue to create new ways 
to market their drug of choice, especially to young people.
    Question. According to the National Survey on Drug Use and Health 
by the Substance Abuse and Mental Health Services Administration, the 
number of people 12 and older who used meth for the first time in the 
previous year decreased from 318,000 people in 2004 to 192,000 people 
in 2005.
    Are you concerned that drug traffickers are trying to lure in new 
customers, particularly young people, by making meth seem less 
dangerous? If so, what steps is DEA taking to address this issue?
    Answer. While the primary function of DEA is to enforce the 
nation's federal drug laws, we understand that law enforcement alone 
cannot solve America's drug problems. DEA works with the youth 
concerning the abuse and awareness of drugs including the serious 
hazards of methamphetamine. Through DEA's Demand Reduction program, DEA 
shares drug law enforcement expertise and intelligence on the nature 
and extent of the national, regional and local drug threat and on 
emerging drug enforcement priorities. In conjunction with its 
prevention partners, DEA engages in aggressive public messaging 
campaigns to illustrate the consequences of drug use, particularly for 
non-users who suffer collateral damage as a result of the illegal drug 
trade. For example, in August of 2005, DEA launched a new website for 
teens, justthinktwice.com. Since its inception the justthinktwice.com 
website has averaged over 200,000 hits per month. This website provides 
teens with straightforward information on the consequences of drugs to 
users and non-users and gives teens the tools they need to make sound 
decisions about drugs. Included in the site is information on 
methamphetamine, prescription drugs, drugged driving, drug endangered 
children, marijuana, drug legalization, and the federal penalties for 
drug trafficking and manufacturing. Justthinktwice.com also dispels 
many of the myths that teens have about drugs by giving them the facts 
about drug legalization, ``medical'' marijuana, and other topics.
    Question. Last year, the Combat Methamphetamine Epidemic Act became 
law as Title VII of the USA PATRIOT Improvement and Reauthorization Act 
of 2005 (Public Law 109-177), and which was designed to retail over-
the-counter sales of certain precursors that are common ingredients in 
cold medicines. Under this law, consumers purchasing cold medicines 
containing ephedrine, pseudoephedrine and phenylpropanolamine must show 
identification and sign a log book at pharmacies. DEA, along with state 
and local law enforcement entities, are responsible for monitoring 
these log books in order to identify if any one person has purchased 
more than 9 grams within a month's time.
    Do you believe the log book is working as hoped to support 
investigations?
    Answer. As a result of state and CMEA legislation, which was 
implemented in September 2006, the downward trend in seizures of 
clandestine laboratories is unmistakable. In 2005 there were a total of 
12,619 reported incidents involving clan labs. Calendar year 2006 saw a 
decrease of 43 percent, or a total of 7,180 incidents. Through April 
25, 2007, only 720 incidents involving clan labs have been reported.

----------------------------------------------------------------------------------------------------------------
                                                                        All                  Super    California
                                Year                                 Incidents  Labs Only     Labs    Super Labs
----------------------------------------------------------------------------------------------------------------
2005...............................................................     12,619      5,879         34          28
2006...............................................................      7,180      3,346         13          10
2007...............................................................        720        361          1           1
----------------------------------------------------------------------------------------------------------------

    Question. Could federal enforcement efforts be more effective if 
the log book was electronic?
    Answer. Logbooks in and of themselves serve are an effective 
enforcement tool because they deter illegal purchases of products 
containing ephedrine, pseudoephedrine, and phenylpropanolamine. Persons 
who might be considering the purchase of these products for diversion 
to the illicit production of methamphetamine are deterred by the 
requirement to provide personal information (name and address) and 
their signature. Logbooks could be more effective as an enforcement 
tool if the data was collected electronically. If the data was 
collected electronically, aggregation of the data across retail 
locations and between states would be easier and potentially more 
effective.
    Question. What enforcement resources has DEA dedicated to this 
area?
    Answer. Investigative authority to enforce CMEA rests with a 
general workforce of approximately 500 Diversion Investigators and 
5,000 Special Agents agency-wide. DEA also leads over 200 state and 
local task forces with over 2,100 state and local task force officers. 
DEA will investigate violations of not only the CMEA, but any violation 
of the Controlled Substance Act as necessary.
    Question. The Combat Meth Act required DEA to establish production 
quotas and import quotas for ephedrine, pseudoephedrine, and 
phenylpropanolamine. This effort was done in order to prevent the 
illicit use of these three chemicals in the clandestine manufacture of 
methamphetamine.
    Do you believe the system for establishing import quotas is working 
smoothly?
    Answer. Although the quota regulations for the CMEA have not yet 
been fully implemented, DEA's 30+ years experience establishing quota 
for other pharmaceutical will ensure smooth administration of the 
import quota applications.
    Question. Can you give us your assurance that the quotas 
established are adequate for medical use?
    Answer. DEA's experience with the schedule I and II controlled 
substances quotas provides a solid foundation for the application and 
implementation of quotas to the list I chemicals: pseudoephedrine, 
ephedrine and phenylpropanolamine as outlined in the CMEA. DEA's 
diligent oversight of the quota applications and process will ensure an 
uninterruptible supply of medicine is available in the United States 
once this law is fully implemented.
    In accordance with 21 U.S.C. 826, DEA is required to establish 
limits on the production of Schedules I and II controlled substances. 
The total quantity for each basic class of controlled substance in 
Schedules I and II is required to be determined on an annual basis. The 
quotas for controlled substances are established each calendar year to 
provide sufficient material for the estimated legitimate medical, 
scientific, research and industrial needs of the United States, for 
lawful export requirements and for the establishment and maintenance of 
reserve stocks. In addition, quotas are intended to limit the 
availability of legitimately manufactured controlled substances which 
can be diverted into the illegitimate market.
    There are three types of quotas that are established pursuant to 21 
CFR Part 1303: Aggregate production quotas, manufacturing quotas and 
procurement quotas. Procurement quotas are issued to DEA registered 
manufacturers who purchase Schedule I or Schedule II material and use 
that material to formulate finished dosage forms i.e. legitimate 
medicine. Manufacturing quotas are issued to DEA registered bulk 
manufacturers. A manufacturing quota is the amount of substance a 
company may produce in a calendar year. Aggregate production quotas 
(APQ) reflect the maximum amount of each controlled substance in 
Schedule I and II which may be produced in a given calendar year. The 
APQ is historically established once and revised mid-year, but the 
administrator has the authority to adjust individual APQ at any time. 
Similarly, the DEA establishes manufacturer's individual manufacturing 
and procurement quotas after careful consideration of the registrant's 
application, legitimate needs and prior year's year end inventory.
    The DEA utilizes two types of information when establishing quotas: 
evidence of legitimate need and evidence of diversion abuse and illicit 
trafficking. The evidence of legitimate need is provided primarily by 
industry and the Food and Drug Administration (FDA) and actual 
pharmaceutical sales trend data supplied by an independent unbiased 
source. Companies submit yearly applications and data to DEA that 
includes actual sales, exports, actual production, customers, product 
development (FDA requirements), batch size, losses, retains and 
inventories of their controlled substances.
    DEA must take into consideration the total net disposal (sales and 
national trends), inventories, projected demands and other factors 
affecting medical, scientific, research and industrial needs in the 
United States and lawful export requirements before adjustment are made 
to individual procurement and manufacturing quotas. Due to changing 
needs of industry, a registrant may request an increase in their 
established quotas at any time. There has never been an occasion in 
which this process has led to a disruption in a patient's access to 
necessary medications.
    Specifically regarding the three substances controlled under the 
CMEA, the DEA developed proposed estimates of the medical need of the 
United States for ephedrine, pseudoephedrine and phenylpropanolamine. 
The methodology used was developed with the assistance of an 
independent contractor that utilized three parallel data sets.
    In establishing the 2007 estimates, DEA also considered exports, 
known industrial uses of these substances, and inventory requirements. 
The establishment of quotas is published as a Notice of Proposed 
Rulemaking in the Federal Register with an opportunity for public 
comment.
    In addition, FDA and the Pharmaceutical Industry are working to 
develop new and reformulated products to insure that there has been no 
interruption of the supply of OTC products containing a nasal 
decongestant, because drug companies have reformulated some of their 
OTC products by replacing pseudoephedrine with phenylephrine, a nasal 
decongestant. FDA has determined that products which contain 
phenylephrine are safe and effective and have effects similar to 
pseudoephedrine.
                                drug use
    Question. At the last April 5, 2006, budget hearing, I asked you 
whether the price and availability of cocaine has changed significantly 
as a result of DEA's efforts. In response, you stated that there have 
been ``statistically significant'' changes in certain areas, and ``It's 
measurable.''
    Since 2001, have the arrests and cocaine seizures by DEA had a 
sustained impact on the availability of cocaine?
    Answer. DEA's large-scale Drug Flow Attack enforcement operations 
have had a major impact on the domestic drug markets. From the first 
quarter of 2007 through the second quarter of 2007, the average price 
per pure gram of all domestic cocaine purchases increased 24 percent. 
DEA's Operation All Inclusive, the centerpiece of DEA's Drug Flow 
Attack Strategy, has caused major disruption in the flow of cocaine, 
money, and chemicals between source zone areas and the U.S. Operation 
All Inclusive 2007 resulted in the seizure of 115 metric tons of 
cocaine which is 12 to 28 percent of the estimated quantity of cocaine 
transported through the transit zones to the United States during 2006. 
Also, in comparing the three month periods before and after Operation 
All Inclusive 2005, the average price per pure gram of cocaine 
increased 43 percent.
    Furthermore, DEA in conjunction with ONDCP, commissioned a 16-month 
study by the CNA Corporation (CNAC) to determine the impact of law 
enforcement activities on cocaine availability in Atlanta, Chicago, and 
Dallas for the period 1999 through 2003.\2\ The study, which was 
completed in April, 2006, sought to (1) to develop a model to identify 
and quantify the relationship between law enforcement activities 
(primarily DEA) and cocaine availability, and (2) to determine whether 
a common model was appropriate for all three cities. The study 
concluded that it is the cumulative or sustained impact of law 
enforcement activities that seem to best explain price and purity 
changes.
---------------------------------------------------------------------------
    \2\ Impact of Law Enforcement Activities on Cocaine Availability: 
Atlanta, Chicago, and Dallas, The CNA Corporation for ONDCP and DEA 
with Department of Health and Human Services, IPR 11781, April 2006.
---------------------------------------------------------------------------
    The study confirmed that DEA's priority targeting system did have 
some temporary impact on availability as observed by price and purity 
proxy measures in the selected cities. A sustained increase in arrests, 
arrests per case, and cocaine seizures are each associated with a 
statistically significant increase in cocaine price and decrease in 
cocaine purity. However, if increased levels of these law enforcement 
measures are not maintained, price and purity will return to their 
previous levels. Moreover, while prices were not higher in 2003 than in 
1999, CNAC inferred that the prices would have been lower and the drug 
problem worse in the absence of law enforcement activities.
    CNAC researchers concluded further that it is impossible to create 
a single model to assess availability at the national level, or even 
between the selected cities. Not only are there simply no accurate 
measures of the quantity of cocaine available locally, regionally, or 
nationally, but there are too many variables that can have a 
significant effect on availability.
Selected key findings
    Arrests, arrests per case, and cocaine seizures have an impact on 
price and purity, and, by inference, on cocaine availability, although 
the impact may not materialize for several months. In addition to the 
quantity of arrests, the concentration of arrests (i.e., targeting 
specific organizations) in a specific case had an impact on price and 
purity. Ten arrests in 1 case, rather than 1 arrest in 10 cases, caused 
bigger disruption or dismantlement than arrests spread across several 
cases.
    The CNAC study concluded that it is the cumulative or sustained 
impact of law enforcement activities that seem to best explain price 
and purity changes: ``Another way to think about this is that price and 
purity were at about the same level in 2003 as in 1999. All of the law 
enforcement activities in those five years did not drive price to a new 
permanent high or purity to a new permanent low. What we observed were 
often substantial, but temporary, price and purity changes following 
short-lived increases in arrests or cocaine seizures. For example, 
prices were relatively high and purity relatively low in Chicago and 
Atlanta in 2000 following a substantial increase in the number of 
arrests in those cities.'' In Chicago, for example, a sustained 20-
percent increase in arrests was associated with an 8 percent ($13.00) 
increase in the price per pure gram for powder cocaine and a 4 percent 
($6.00) per gram increase for crack cocaine. To the degree that powder 
prices are more indicative of the wholesale market and crack the retail 
market, DEA arrests impacted the wholesale market more than the retail 
market.
    Question. At that same hearing, I asked you whether you agreed, 
that in Washington, D.C., the prices of crack cocaine have not 
increased and the availability of cocaine is about the same as it was 
three years ago. In response, you stated that you would get back to me. 
A year later, we still have not received a response.
    Does the evidence show that the price and availability of cocaine 
in Washington, D.C. has changed significantly as a result of DEA's 
efforts?
    Answer. The following is a brief overview of the cocaine pricing 
and availability situation in Washington, D.C.
Cocaine Prices
    DEA's Washington Division reports that cocaine prices in 
Washington, D.C. have remained stable over the past six years, as have 
cocaine availability and abuse patterns. Cocaine price data for the 
period January through March 2006 indicate that cocaine hydrochloride 
sold for $1,100 per ounce in the Washington, D.C. metropolitan area 
compared to a price range of $900-$1,250 in 2001. Kilogram and gram 
powder cocaine prices and crack cocaine prices were not reported for 
2006.
    Prices are derived from undercover buys, Confidential Source (CS) 
information, and defendant information. Price data is not a completely 
accurate indicator of supply and demand. Much of this information is 
anecdotal, and prices cannot be validated through any scientific 
methodology. The greater the quantity, the more anecdotal the 
information, since DEA does not often purchase kilogram quantities.
    The following chart provides the latest data available on cocaine 
prices for Washington, D.C. The national price range is provided for 
comparison.

                                                     WASHINGTON, D.C. COCAINE PRICE RANGES 2001-2006
                                                     [National Price Range Provided for Comparison]
--------------------------------------------------------------------------------------------------------------------------------------------------------
               Quantity                        2001               2002               2003               2004               2005               2006
--------------------------------------------------------------------------------------------------------------------------------------------------------
Powder Cocaine (cocaine HCl):
    Kilo--DC..........................      16,500-35,000      17,500-35,000      17,000-35,000      24,000-25,000      23,000-27,000      19,000-26,000
    Kilo--National....................      13,000-35,000      10,000-35,000      10,000-35,000      10,000-35,000       7,000-34,000       9,000-52,000
    Ounce--DC.........................          900-1,250          600-2,000          825-1,300          900-1,100          650-1,250              1,100
    Ounce--National...................          400-1,600          400-3,500          375-1,800          350-1,800          300-1,600          300-2,000
    Gram--DC..........................             50-100              30-80             50-100                100            ( \1\ )            ( \1\ )
    Gram--National....................             20-200             24-150             25-100              9-200             20-200             13-350
Crack Cocaine (cocaine base):
    Kilo--DC..........................      28,000-34,000             30,000      28,000-34,000      28,000-34,000      28,000-34,000            ( \1\ )
    Kilo--National....................      13,000-50,000      13,000-35,000       7,500-35,000       8,000-38,000      14,000-34,000      13,000-32,000
    Ounce--DC.........................          900-1,300          900-1,750        1,000-1,300        1,000-1,200          550-1,250          900-1,200
    Ounce National....................          300-2,800          325-2,800          325-2,000          325-2,000          325-2,000          210-3,800
    Gram--DC..........................             80-100             80-100             80-100            ( \1\ )            ( \1\ )            ( \1\ )
    Gram--National....................             10-200             10-130             10-130             18-200             20-200             12-200
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ N/R.

Source: Quarterly Trends in Traffick Report--DEA Washington Division.

Changes in the Washington, D.C. Cocaine Market
    The main change in cocaine trafficking in the metropolitan area 
pertains to cocaine sources of supply. Over the past several years, 
cocaine smuggling from North Carolina and from the Southwest Border 
(especially Texas and Arizona) has increased. This mainly impacts 
Southern Virginia, but still affects Northern Virginia and Washington, 
D.C. Drug trafficking organizations in New York City, however, still 
appear to be the principal cocaine suppliers for Washington, D.C.
Cocaine Availability
    The Washington, D.C. Metropolitan Police Department (MPD) indicates 
that cocaine availability has remained stable over the past several 
years. The MPD also reports that drug-related violence remains static, 
with the exception of homicides, which have decreased over the past 
five years.
    Cocaine Hydrochloride (HCl).--Kilogram quantities of cocaine HCl 
continue to arrive in the DEA Washington Division area of 
responsibility (Washington, D.C., Maryland, Virginia, and West 
Virginia). Powder cocaine sold on the mid- to retail level remains 
widely available. The quantities of cocaine HCl available in any given 
area greatly depend on abuse patterns, the level of distribution at 
which a particular dealer conducts business, and the prevalence of 
cocaine abuse in that area. Cocaine HCl most commonly is found in gram 
and ounce quantities for resale in suburban and rural areas, but in 
larger quantities (i.e., quantities appropriate for redistribution 
after conversion to crack) in urban areas of the Division.
    Crack Cocaine.--Crack cocaine is available throughout the 
Washington Division are of responsibility in quantities ranging from 
rocks up to one kilogram. Most of the crack cocaine distributed within 
the Division is brought in as cocaine HCl and subsequently converted to 
crack. Generally, significant quantities of crack cocaine are not 
stockpiled and are manufactured according to demand.
    Question. Two months ago, Administrative Law Judge Mary Bittner 
ruled that University of Massachusetts Professor Dr. Lyle Craker could 
grow marijuana for medical research purposes. Judge Bittner found a 
``minimal risk'' that the marijuana would be diverted to the black 
market. And she found that the government's current use of one medical 
marijuana research facility insufficient to meet the needs of 
legitimate medical researchers. DEA must now review Judge Bittner's 
ruling granting Dr. Craker approval to cultivate medical marijuana.
    What procedures will DEA follow in reviewing Judge Bittner's 
ruling? Will DEA solicit the input of governmental and non-governmental 
organizations in this process?
    Answer. DEA has never denied a registration to a person seeking to 
conduct clinical research with marijuana whose research protocol has 
been deemed meritorious by the Department of Health and Human Services. 
By law, DEA must--prior to granting a registration to conduct such 
research--seek the input of the Department of Health and Human Services 
(DHHS) as to the scientific merit of the proposed research. If DHHS 
finds the proposed research to be scientifically meritorious and the 
researcher to be competent, DEA must assess whether the research will 
have in place sufficient safeguards against diversion. Provided the 
diversion controls are sufficient and the proposed research is 
otherwise in conformity with the Controlled Substances Act, DEA will 
grant the research registration. Under the Administrative Procedure Act 
and the Controlled Substances Act, the Administrative Law Judge issues 
recommendations rather than final decisions. Ultimately, the Deputy 
Administrator of DEA makes the final determination.
    The University of Massachusetts case has been submitted to the 
Deputy Administrator for a final determination. While the case remains 
pending before the agency, it would inappropriate for DEA to comment on 
it.
    Question. In May of 2006, DEA arrested five Mexican nationals 
during a raid at a heroin lab in Toluca, Mexico. The lab was suspected 
of being the principal source of fentanyl pushed into the U.S. drug 
supply of heroin and cocaine, causing deaths in eight states. U.S. Drug 
Czar John Walters estimated that there could be 1 million doses of the 
tainted drug on the streets.
    Are you concerned that drug traffickers have substantially poisoned 
the U.S. drug supply?
    Answer. DEA is deeply concerned over the illicit distribution of 
fentanyl, which has caused an unprecedented outbreak of fentanyl-
related overdoses. Between April 2005 and February 2007, at least 972 
confirmed fentanyl-related deaths, and an additional 162 suspected 
fentanyl-related deaths have occurred primarily in Delaware, Illinois, 
Maryland, Michigan, Missouri, New Jersey, and Pennsylvania. A total of 
903 confirmed fentanyl-related deaths occurred during 2006.
    DEA has responded by hosting a coordination meeting of federal, 
State, and local law enforcement officials in Chicago in June of 2006 
to address this recent fentanyl outbreak. Several DEA Field Divisions, 
including DEA's Mexico City office, the Department of Justice, and the 
Office of National Drug Control Policy (ONDCP), state chemists, and 
public health and treatment officials attended this event. DEA has 
assisted the interagency response to the fentanyl threat by 
participating in numerous teleconferences with SAMSHA (Substance Abuse 
and Mental Services Health Administration), CDC (Centers for Disease 
Control) and other agencies regarding fentanyl-related deaths.
    Question. Is there any indication that traffickers may be building 
more labs? And do you believe Congress needs to tighten controls on the 
precursors used to make fentanyl?
    Answer. Because of recent clandestine laboratory activity and the 
serious threat illicitly produced fentanyl poses to the public safety, 
DEA will regulate or control the chemical precursors used in the 
illicit manufacture of fentanyl. These precursors are 4-anilino-N-
phenethyl-4-piperidine (ANPP), (CAS# 21409-26-7) and N-phenethyl-4-
piperidone (NPP), (CAS# 39742-60-4). Both of these precursors are 
required to produce fentanyl. NPP produces ANPP which is not 
commercially available and is the direct precursor to fentanyl.
    DEA has controlled the intermediary precursor, N-phenethyl-4-
piperidone (NPP) as a List I chemical under the Controlled Substances 
Act (CSA) through an Interim Rulemaking, effective April 23, 2007. The 
new rule subjects handlers of NPP to the chemical regulatory provisions 
of the CSA. The designation of NPP as a List I chemical subjects NPP 
handlers to all of the regulatory controls and administrative, civil, 
and criminal sanctions applicable to the manufacture, distribution, 
importing, and exporting of a List I chemical. Persons potentially 
handling NPP, including regulated chemical mixtures containing NPP, are 
required to comply with the List I chemical regulations including 
registration, records and reports, import/export, security, and 
administrative inspection.
    DEA is also moving to control the precursor chemical, 4-anilino-N-
phenethyl-4-piperidine (ANPP) as a schedule II controlled substance, 
because it is an immediate precursor in the production of fentanyl and 
warrants the stricter DEA controls applicable to schedule II drugs. DEA 
is in the process of preparing a Federal Register Notice to propose 
this control. As a schedule II controlled substance, ANPP will be 
subject to the same registration, recordkeeping, security and import/
export controls as fentanyl.
                                 ______
                                 
            Questions Submitted by Senator Richard C. Shelby
                            methamphetamine
    Question. Administrator Tandy, methamphetamine use has become a 
severe and very worrisome problem in Alabama. While the number of labs 
seized in Alabama has decreased significantly the problems related to 
this drug continue to worsen.
    Can you tell the Committee how methamphetamine distribution has 
changed?
    Answer. Methamphetamine is unique from other common drugs of abuse 
in that it is a synthetic drug, and its precursor chemicals have 
historically been easy to obtain and inexpensive to purchase. These 
factors contributed to methamphetamine's rapid sweep across our nation. 
However, State legislation, the Federal Combat Methamphetamine Epidemic 
Act, and law enforcement efforts have all contributed to a significant 
decline in methamphetamine labs inside the United States. The number of 
methamphetamine laboratory incidents reported in the United States has 
decreased from 17,857 in 2004 to 7,385 in 2006, a 59 percent 
decrease.\3\ The number of ``super labs'' seized in the United States 
dropped from 144 in 2002 to 20 in 2006, a decrease of 86 percent.
---------------------------------------------------------------------------
    \3\ Methamphetamine laboratory incident data is current as of 
August 28, 2007.
---------------------------------------------------------------------------
    Current drug and lab seizure data suggests that roughly 80 percent 
of the methamphetamine used in the United States now comes from larger 
laboratories run by Mexico-based trafficking organizations operating on 
both sides of the border. The proliferation of methamphetamine across 
the United States, and its spread to states such as Texas, Georgia, and 
Alabama, has required our offices, in concert with their State and 
local counterparts, to gear the majority of their methamphetamine 
enforcement efforts towards the targeting of poly-drug trafficking 
organizations, rather than small lab operators. These drug trafficking 
organizations have distribution networks throughout the United States, 
as well as access to drug transportation routes to smuggle the 
methamphetamine from Mexico into the United States.
    Question. How are you attacking this problem?
    Answer. DEA is working hard with the Government of Mexico to target 
the criminal organizations involved in the diversion of precursor 
chemicals and the producing and trafficking of methamphetamine. 
Relations between Mexican authorities and DEA are at an all time high 
in terms of chemical control. Mexico has imposed import quotas tied to 
estimates of legitimate national needs. The Mexican Government limited 
pseudoephedrine, ephedrine, and combination product importation permits 
to 70 tons during 2006; this is a reduction of 53 percent from the 2005 
level of imports (150 tons). Mexico has discussed revising their quota 
downward even further in 2007.
    In May 2006, at the National Methamphetamine and Chemicals 
Initiative (NMCI) Strategy Conference in Dallas, Attorney General 
Gonzales announced important new anti-methamphetamine domestic 
initiatives, as well as new partnerships between the United States and 
Mexico in fighting methamphetamine trafficking. These initiatives will 
improve enforcement and information sharing, increase law enforcement 
training, and increase public awareness both domestically and 
internationally. Since this announcement, methamphetamine enforcement 
teams have been formed on both sides of the border and DEA has donated 
eight refurbished clan lab trucks to Mexico.
    Additionally, DEA and the Department of State, Bureau of 
International Narcotics and Law Enforcement Affairs trained over 2,000 
Mexican officials in fiscal year 2006 on a variety of investigative, 
enforcement, and regulatory methods related to methamphetamine 
trafficking and manufacturing. This training included instruction on 
clandestine laboratory investigations, precursor chemical 
investigation, and drug identification. As a result of this training, 
Mexican law enforcement officials have had significant success in 
identifying labs.
    In fiscal year 2006, DEA also trained over 41,000 State and local 
law enforcement officers, including over 1,000 in how to conduct 
investigations and dismantle seized methamphetamine labs. By the end of 
2008, DEA also plans to complete a clandestine laboratory training 
facility in Quantico, Virginia to better train more State and local 
officers.
    DEA has expanded the role of its Clan Lab Enforcement Teams to 
target Mexican methamphetamine trafficking organizations. These teams 
use their lab expertise to trace chemicals, finished methamphetamine, 
and drug proceeds to drug trafficking organizations in the United 
States and Mexico. These teams also work to identify and dismantle 
U.S.-based methamphetamine transportation and distribution cells.
    DEA has also developed an intelligence collection program, 
Operation White Fang, to assist in the identification and targeting of 
organizations responsible for producing and trafficking methamphetamine 
across the entire Southwest Border. The operation focuses particularly 
on the groups responsible for the drug related violence facilitated by 
the major Mexican cartels operating along the U.S./Mexico border. In 
the fiscal year 2008 President's budget, DEA requests $325,000 to 
expand this operation.
    Question. How has the DEA adjusted its enforcement activities to 
meet this threat?
    Answer. In addition to the efforts mentioned above, DEA has used a 
multi-tiered approach over the last several years to enhance its attack 
on the diversion of bulk quantities of key precursors needed to 
manufacture methamphetamine, ephedrine, and pseudoephedrine. On the bi-
lateral front, through our offices based in the United States and 
overseas, we are making headway by actively targeting, through joint 
investigations and initiatives, the diversion of precursor chemicals 
and the organizations involved in this activity. On the multi-lateral 
front, we are working with relevant international organizations and 
engaging both source and transit countries through international forums 
to target the diversion of these substances and to promote and 
promulgate good practices to prevent their diversion in the future.
    In March 2006, the United States successfully sponsored a 
resolution at the United Nations Commission on Narcotic Drugs (CND) 
that requests countries to provide and share voluntary information 
relating to their annual requirements for key methamphetamine 
precursors and urges countries to provide information to the 
International Narcotics Control Board (INCB) on shipments of these 
precursors in both bulk and tablet forms. This data will serve to allow 
the international community to observe where potential areas for 
diversion of these precursor chemicals are occurring. At present, some 
80 nations have provided estimates of their annual licit requirements 
for bulk ephedrine and pseudoephedrine to the INCB who in turn will 
publish this information on a yearly basis in their annual precursor 
report. Importantly, the resolution also requests that countries permit 
the INCB to share information regarding suspicious shipments with law 
enforcement authorities, so that appropriate measures can be taken in 
order to prevent or interdict those shipments of concern.
    During a meeting of the CND in March 2007, the United States joined 
the European Union (EU) in co-sponsoring an EU-drafted resolution which 
contained many useful and potentially important provisions regarding 
methamphetamine precursor control. Among other things, the resolution 
requests member states to voluntarily recognize the heightened threat 
of diversion of ephedra and phenylacetic acid, to exercise increased 
vigilance regarding their movement, to apply available monitoring 
measures regarding the trafficking of non-controlled derivatives and 
substitute chemicals, and to develop further national guidelines and 
training programs in consultation with industry with respect to 
precursor chemical control.
    While theses resolutions on precursor chemical control are 
important steps, they are voluntary measures which will take several 
years to be fully implemented and, as such, we do not see them as the 
sole solution to our obtaining information regarding diversion of these 
precursors from licit trade. We do see the CND resolutions as important 
steps in the sharing of information to which, heretofore, we were not 
privy.
    Question. Would you explain the toxic and environmental challenges 
that DEA agents face when they find these labs?
    Answer. Clandestine drug laboratories are a unique law enforcement 
challenge to DEA agents, our State and local law enforcement 
counterparts, and any peripheral support personnel providing assistance 
to the investigation and dismantlement of a lab. Methamphetamine's 
addictive characteristics produce devastating effects on all of its 
victims. These victims are not limited to those who choose to use this 
poison, but include others who become part of what could be considered 
the drug's ``collateral damage''. Those who suffer the ``second-hand'' 
effects of meth include the victims of methamphetamine-related crimes, 
innocent children whose homes have been turned into toxic clandestine 
lab sites, law enforcement officers who work with the hazardous 
materials found at lab sites, and the environment from the 
approximately five pounds of toxic waste produced for every pound of 
methamphetamine cooked.
    Poisons and other highly toxic materials are often used in the 
illicit manufacturing of methamphetamine. The potentially hazardous 
elements that agents face when addressing a clandestine lab may include 
corrosive chemicals in combination with flammable chemicals. The 
corrosives may be both acidic and caustic in nature and in liquid, 
solid, or gas form. Aside from the volatilization of acids and solvents 
due to the introduction of heat, other more lethal compounds may be 
created at various stages in the clandestine production process. 
Chemical reactions between these ingredients may also generate reaction 
by-products that present a significant toxic danger. Additionally, the 
fire and explosion hazards in clandestine lab environments are 
considerable as a result of the solvents used in the chemical 
processing and extraction of the methamphetamine.
    During clandestine laboratory investigations, aside from evidence 
collection, DEA and law enforcement in general only dismantle and 
remove the chemicals, glassware, and apparatus. Law enforcement 
conducts only gross contaminant remediation and virtually no site 
decontamination. Currently, no national standards for remediation and 
decontamination exist. However, the U.S. House of Representatives 
recently passed legislation to change this. The legislation charges the 
Environmental Protection Agency with the development of guidelines to 
assist State and local authorities in cleaning up former 
methamphetamine lab sites.
                        financial investigations
    Question. Administrator Tandy, when we met earlier this year we 
discussed the fact that Americans spend up to $65 billion annually on 
illegal drugs. DEA is making a renewed effort to go after the cash 
profits in the drug business. You stressed in our meeting that DEA is 
looking at the drug trade as a business and attacking the flow of drug 
proceeds with financial and money laundering initiatives.
    Can you tell the Committee more about what you are doing in these 
financial investigations?
    Answer. DEA has set a five-year plan that by fiscal year 2009 we 
will be taking $3 billion per year away from all drug trafficking 
organizations (DTOs). The cumulative targets over five years total $10 
billion. In just the first two years we have denied traffickers $3.5 
billion in revenue. We count not only the money and property seized, 
but also the value of the drugs seized--that is the amount of funds 
invested in the drugs by the owner computed at production cost levels, 
which are very conservative.
    To accomplish these goals, DEA makes use of its authority to 
conduct undercover operations, known as Attorney General Exempted 
Operations (AGEO), which employ sensitive activities delineated by the 
Department of Justice (DOJ). In order for DEA to participate in these 
undercover money laundering investigations, the operation must undergo 
review by the Sensitive Activities Review Committee (SARC) and be 
approved by both the DEA Administrator and by a Deputy Assistant 
Attorney General of DOJ's Criminal Division.
    There are two possible types of SARC approved operations. The first 
is a Shelf Account operation. This operation enjoys the authority to 
establish undercover corporations and to open related undercover bank 
accounts to assist in ongoing narcotics investigations. A DEA office 
may then conduct transactions with a cap of $1.5 million.
    The second type of SARC approved operation is a Full Exemption. 
This type of operation allows for the establishment of an undercover 
corporation and bank account, but also affords the operation the use of 
any commissions collected to offset reasonable undercover expenses and 
to enter into an undercover lease of property. These types of 
investigations allow DEA Special Agents, acting in an undercover 
capacity the ability to infiltrate drug organizations through the use 
of financial transactions.
    Both types of operations are approved for a period of six months, 
each must call DEA's Office of Financial Operations (FO) in advance of 
any undercover pickup for a FO transaction number for tracking purposes 
and to assure FO that they have received prior approval from the DEA 
Country Attache (CA) from any affected foreign office. The individual 
CA approval will also include documentation of the U.S. Ambassador and 
host counterpart's prior approval as well. All three approvals must be 
secured before any enforcement activity takes place in the foreign 
country, to include the wire transferring of funds which have been 
laundered, thus insuring compliance with DEA's Memorandums of 
Understanding with the Department of State as well as the host 
government counterparts. Each of the operations must also submit 
monthly statistical reports and undergo onsite inspections every six 
months.
    A Fully Exempted operation will have a cap of $10 million, which 
may be increased upon a written request with an appropriate 
justification to the SARC committee. Each Fully Exempted operation must 
also be target specific, precluding DEA from operating open ended 
umbrella operations. Before extensions are granted for Fully Exempted 
operations, a review of the operation's arrests, seizures, and Title 
IIIs (lawful communications intercepts) conducted during the current 
reporting period are taken into consideration.
    Question. How do drug cartels get their cash profits out of this 
country and how is the DEA dealing with this threat?
    Answer. According to current estimates from the National Drug 
Intelligence Center, between $13 billion and $47 billion per year in 
drug trafficking profits leave the United States, mostly in the form of 
bulk currency, bound for international sources of supply. The smuggling 
of large sums of cash across our borders is the primary method used to 
expatriate drug proceeds from the United States. To target this flow of 
cash, DEA has initiated the following national financial initiatives:
    The Bulk Currency Initiative, a Special Enforcement Operation, 
coordinates all U.S. highway interdiction money seizures to develop the 
evidence needed to identify, disrupt, and dismantle large-scale 
narcotic trafficking organizations. When DEA is notified of a cash 
seizure by a State or local municipality, agents respond to the scene, 
assist with debriefing the defendants, and coordinate potential 
controlled deliveries of currency. Special Agents also assist in 
follow-up investigations, seizure and forfeiture of currency, and 
provide guidance on federal prosecution. DEA's El Paso Intelligence 
Center (EPIC) conducts research and analyzes evidence and intelligence 
relating to PTOs and other types of investigations.
    The Bulk Currency Initiative is aimed at assisting in the 
development of new investigations pertaining to seizures of large 
amounts of United States currency, as well as linking these seizures to 
ongoing drug investigations. This initiative endeavors to bring 
together all of the information and intelligence from existing 
interdiction programs through cooperative and collaborative sharing of 
information between federal, State, and local initiatives, and includes 
currency seizures made on United States highways through the highly 
successful Operation Pipeline program, and currency seizures made at 
various United States commercial airports through Operation Jetway. 
Additionally, DEA relies on its extensive foreign operations apparatus 
to identify instances where bulk United States currency is introduced 
into a foreign country's local economy.
    The Bulk Currency Initiative attempts to coordinate investigations 
that will be initiated in the field and assist in obtaining evidence 
and intelligence that may be shared among the various DEA field 
divisions. The DEA has found that the transportation of large amounts 
of United States currency from within the United States to various 
border locations continues to be one of the primary methods utilized by 
large scale trafficking organizations to launder narcotics proceeds. 
After arrival at any of the numerous border crossing points throughout 
the United States, this bulk currency is easily transported into a 
foreign country where it can be placed into the financial system with 
less risk of detection or reporting to law enforcement authorities, and 
eventually be utilized for a variety of illegal purposes. This movement 
of bulk cash presents an opportunity for law enforcement entities to 
disrupt an important facet of the narcotic trafficking process.
    The Concealment Trap Initiative, a Special Enforcement Operation 
program, targets those vital service providers who build concealed trap 
compartments in conveyances and residences for DTOs. The initiative has 
a two-fold objective. The first is to identify, prosecute, and/or gain 
the cooperation of the trap builders to identify the DTOs for whom they 
have previously built concealed traps. The second is, through the use 
of these cooperators and/or DEA Special Agents who have already been 
specially trained in the art of building concealment traps, to offer to 
build traps or provide trapped out vehicles (within the legal 
framework). These traps will have installed tracking devices to enable 
law enforcement to monitor the movement of these vehicles. These 
trapped vehicles will act as pointers to identify stash houses or 
locations where drugs and money are picked up and dropped off. Once 
these locations are identified, surveillance, controlled deliveries, 
communications intercepts, and other investigative techniques will 
enable the investigators to identify and seize millions in additional 
drug proceeds. Interdiction stops of vehicles using independent 
probable cause, with no reference to DEA's current investigation, will 
also be performed whenever possible. The vehicle with a concealed 
compartment will also be used to track bulk currency shipments back to 
the source of the drugs.
    Operation Highwire, a Special Enforcement Operation program, funds 
undercover sting operations targeting money remitters and others who 
offer money laundering services. Operation Highwire focuses on 
individuals involved in laundering drug proceeds through money remitter 
companies or individuals providing remitter-like services. DEA is 
targeting the finances of drug trafficking organizations operating 
along the Southwest Border, in the transit zone, and in source 
countries. DEA is also expanding financial investigations beyond the 
Western Hemisphere. Through its presence in Afghanistan, Dubai, and the 
surrounding region, DEA is targeting the flow of drug revenue suspected 
of financing terrorist activities. For example, DEA is developing 
intelligence on Afghanistan-based Hawaladars.
    The Hawala system is the principal method through which money is 
moved from, to, and throughout Afghanistan. Hawala is an established 
and accepted facet of the licit Afghan financial services industry. 
Legitimate Hawala brokers exist in Afghanistan and throughout the 
Islamic world. Afghan legislation requires hawalas to register with and 
be regulated by the Government of Afghanistan. The underground system 
thrives particularly due to the dearth of a legitimate banking industry 
in country. Approximately eleven banks have opened in Afghanistan since 
the fall of the Taliban. To date, these banks enjoy only a small 
portion of business typically reserved for banks. In zero sum fashion, 
Hawaladars often replace existing banks as providers of financial 
services. The principal service provided by Hawaladars is the transfer 
of money from one place to another. That traditional service does not 
preclude others, such as: currency exchange, check cashing, 
safeguarding of monies (i.e. acceptance of deposits), and other 
services. Moreover, it is believed that a significant percentage of 
Hawaladars also work in the import/export field.
    By working closely with our host nation counterparts, such as the 
Counter Narcotics Police-Afghanistan, DEA enjoys the access it needs to 
learn how traditional systems like Hawala operate. This knowledge, 
combined with DEA's institutional expertise in international drug 
investigations and drug intelligence will allow DEA to demonstrate that 
the Hawala system is not invulnerable. DEA's initial objective is to 
identify illicit money remitters operating in Afghanistan, and the 
Hawaladars with whom they work worldwide.
    Specific attention will be paid to identifying linkages to the 
United States. Acquisition of Hawaladar identifying information such as 
telephone/cell phone contact information, names, and possibly addresses 
will be the first step towards homing in on those involved with drug 
money laundering and with the provision of financial services to 
terrorists. Hawala transaction data is obtained through various means. 
Some is obtained through arrests and/or the execution of search 
warrants by DEA's foreign counterparts, who share the data with us. 
Communication intercept operations also yield hawala transaction data. 
Hawaladars in the United Arab Emirates are required by the government 
to file suspicious activity reports and to make their books available 
for inspection. Afghan authorities are implementing similar measures. 
Frequently, legitimate hawaladars form guild-like organizations, 
generally referred to as Hawala Unions, which set and enforce business 
standards and guarantee customers' rights. The Afghan government has 
established liaison relationships with a number of these unions in 
furtherance of developing market watch intelligence. Upon 
identification of a hawaladar participating in illicit activity, 
operational personnel will pass communications and other identifying 
information to the DEA's Special Operations Division and OCDETF's 
Fusion Center for exploitation. Between DEA, FBI, and other U.S. 
government database checks, and SOD communications exploitation, those 
Hawaladars determined to be involved with narcotics trafficking and/or 
terrorism will become potential targets of investigation.
    The Money Trail Initiative (MTI) is a Special Operations Division 
(SOD) supported multi-jurisdictional, multi-agency, Organized Crime 
Drug Enforcement Task Force (OCDETF) initiative targeting various DTOs 
that attempt to avoid law enforcement detection by smuggling multi-
million dollar amounts of U.S. currency within and out of the United 
States to further their criminal enterprises. The MTI includes attempts 
to identify new bulk currency smuggling techniques and has already 
demonstrated a tangible impact from several operations. To date, 
$126,098,915 in cash and $22,667,016 in assets have been seized. A 
total of 14,719 kilograms of cocaine, 161,447 pounds of marijuana, 538 
kilograms of methamphetamine, 300 pounds of ice, and 35 kilograms of 
heroin have been taken off the streets under this initiative. The MTI 
involves the coordination of national bulk currency wire tap 
investigations and employs a ``Follow-The-Money'' strategy that enables 
domestic and Mexico-based DEA offices to utilize a more systematic and 
proactive approach to respond to techniques and trends in bulk currency 
operations. Through a coordinated operation, agents track the movement 
of currency forward to intended recipients and backward from the 
couriers to identify the breadth and scope of the DTOs that generate 
money. The MTI allows investigators to identify the money and drug 
transportation coordinators, couriers, and facilitators that are often 
shared between multiple DTOs.
    DEA Financial Investigative Teams focus on the flow of drug 
proceeds and how they can be identified and seized. While DEA will lead 
these efforts, they will involve cooperation with our federal, State, 
local, and foreign counterparts.
    The National Trucking Initiative, a Special Enforcement Operation 
program, is aimed at assisting in the development of relationships 
between DEA and the United States trucking industry. This will allow 
DEA access to the industry's assets and intelligence, which will assist 
DEA in disrupting the method for transporting drug proceeds via rogue 
trucking companies or transportation groups, in collaboration with 
several major truck lines.
    The License Plate Reader (LPR) Initiative combines the DEA, HIDTA, 
and U.S. Customs and Border Protection (CBP) database capabilities with 
new technology to identify, interdict, and/or develop intelligence on 
conveyances being utilized to transport drugs and bulk cash. DEA has 
implemented capabilities to exploit data collected from the LPR in 
Texas where the DEA Houston Division Office is currently operating LPRs 
in Falfurrias and Laredo. Use of the data from LPRs will be expanded 
nationally as funding becomes available. DEA exploits data collected 
from the LPR devices to tip-off DEA and other law enforcement agencies 
to suspect vehicles moving both to and from the Mexico border and 
identify conveyances being utilized to transport drugs and bulk 
currency. This is accomplished using the El Paso Intelligence Center as 
the recipient of all tactical requests. In addition, DEA has set an 
internal requirement to determine what strategic value and uses are 
being gained from the program to assure the program is best utilized. 
Once the proper network is funded, LPR data will be funneled to the 
OCDETF Fusion Center where it will be used for a comprehensive 
analytical research project.
    In the Fiscal Year 2007 Global War on Terror Supplemental, DEA 
requested and received $3,000,000 in non-personnel funding for 
Financial Investigations to support a proactive attack on the financial 
infrastructure of drug trafficking organizations operating in 
Afghanistan and within the region to help prevent Afghanistan from 
becoming a narco-terrorist state. This funding will support two 
initiatives: the first is an operation to develop a precise 
understanding of the Hawala system, and the second is to establish an 
ongoing, coordinated, regional Financial Investigation Training 
Program. The training program is being done in conjunction with the 
Department of State, the Department of Defense, and on a country by 
country basis with pertinent Operation Containment allies.
    Question. Under the Bank Secrecy Act, the Departments of Treasury 
and Homeland Security administer a number of enforcement activities and 
regulatory restrictions on money remitters. How are you collaborating 
with these Departments to jointly stop the flow of money?
    Answer. Money remitters are classified as Money Service Businesses 
(MSB) under the Bank Secrecy Act (BSA). As a MSB, money remitters fall 
under the Currency Transaction Report (CTR) filing requirements of the 
BSA. IRS is designated as the regulatory monitoring authority for MSBs 
for BSA regulatory compliance. Additionally, IRS-Criminal Investigation 
(CI) has sole jurisdiction over the enforcement of the CTR reporting 
requirements. Since both domestic and international drug trafficking 
organizations exploit the vulnerabilities of the money remitting 
industry, DEA works very closely with the IRS on both case specific and 
industry-wide programs relating to money remitters. DEA also works with 
DHS/Immigration and Customs Enforcement (ICE) on case specific matters 
involving money remitters when the facts of the case involve the cross 
border transmission of drug money. For example, a DEA group is assigned 
to the ICE-led El Dorado Money Laundering Task Force in New York.
    In addition to the flow of money through MSBs, it is likely that 
each year $8.3 billion to $24.2 billion in Mexican and Colombian 
wholesale drug proceeds generated in the United States are moved into 
Mexico via bulk cash smuggling by vehicles.\4\ To combat this illicit 
drug money transiting the Southwest Border (SWB) into Mexico, DEA field 
divisions along the border are actively working with Customs and Border 
Protection (CBP), ICE, and IRS-CI on proactive investigations and money 
flow initiatives:
---------------------------------------------------------------------------
    \4\ U.S. Department of Justice National Drug Intelligence Center 
(2006). Prepaid Stored Value Cards: A Potential Alternative to 
Traditional Money Laundering Methods. Assessment, Product No. 2006-
R0803-001, 9 pages.
---------------------------------------------------------------------------
  --DEA, ICE, and IRS-CI all participate in the Texas Department of 
        Public Safety (DPS) Post Seizure Analysis Team in Austin, 
        Texas.
  --DEA, ICE, and the Arizona DPS are working together on a large 
        multi-jurisdictional investigation targeting the DTOs utilizing 
        concealed traps to transport money throughout the United States 
        and into Mexico.
  --DEA is working very closely with the Treasury Office of Foreign 
        Assets Control (OFAC) through real-time access to sensitive 
        case related intelligence to assist OFAC in its Kingpin and 
        Tier II designation of Mexican drug traffickers and their 
        associated entities.
  --ICE and CBP are working with DEA's Houston Field Division on 
        investigations into Mexican drug trafficking organizations 
        responsible for sending thousands of kilograms of cocaine and 
        methamphetamine into the United States, and tens of millions of 
        drug dollars back to Mexico.
  --ICE is working with the DEA Phoenix Field Division and Arizona DPS 
        on initiatives aimed at interdicting the flow of bulk cash 
        across the SWB. For example, the Arizona Money Trap Initiative 
        was designed by the Phoenix Field Division to form a 
        partnership with the various federal, State, and local law 
        enforcement entities in Arizona. This partnership attacks as 
        many facets as possible of the transportation and smuggling of 
        bulk currency across the State. At the core of the initiative 
        is the concept that information from various cash seizures will 
        be shared, and acted upon by the member entities in a 
        coordinated manner The initiative has several ongoing cases.
  --EPIC, through its new National Seizure System (NSS), will act as a 
        central repository for bulk cash interdiction intelligence 
        information. ICE has tentatively agreed to place its bulk cash 
        information in the NSS.
  --ICE and IRS-CI are participating agencies at the DEA Special 
        Operations Division (SOD). SOD coordinates DEA's largest and 
        most sensitive investigations on drug money flow across the 
        SWB. As participants at SOD, both ICE and IRS-CI have access to 
        the SOD databases for deconfliction and coordination of their 
        money flow investigations with DEA's.
  --DEA and CBP are working on a number of initiatives aimed at fusing 
        intelligence to identify and interdict money flowing across the 
        SWB by and on behalf of DEA targets of investigation. DEA and 
        CBP Headquarters are working with the Fusion Center to test the 
        LPR program by combining indices from each organization. DEA 
        and CBP are also working in Texas on the Divisional use of the 
        LPR system. Additionally, DEA and CBP are working at the 
        Headquarters level in the trial stages of using CBP 
        international parcels data to target and interdict bulk 
        currency and other contraband being shipped via parcels out of 
        the United States.
  --IRS-CI is assisting the DEA Las Vegas District Office in the 
        follow-up investigation of the recent seizure of $207 million 
        in Mexico City from a supplier of precursor chemicals used in 
        the production of methamphetamine.
                                internet
    Question. Drug traffickers, like virtually every other industry, 
legal or illegal, use the internet to conduct business.
    What is the DEA doing to attack this problem?
    Answer. The Internet is the fastest growing source of diverted 
controlled pharmaceuticals. DEA is working hard to attack this problem 
on many fronts:
  --DEA has provided all field divisions with undercover credit card 
        accounts in order to make online purchases of controlled 
        pharmaceuticals for use as evidence in Internet investigations.
  --From October 2002 through December 2006, a total of 3,924 
        individuals (3,327 federal participants and 597 State and local 
        participants) have completed DEA's online investigations 
        training program. This training is provided to DEA Special 
        Agents, Diversion Investigators, and Intelligence Analysts, as 
        well as State and Local Task Force Officers.
  --DEA's Online Investigations Project is used to provide Whois 
        (registration information relative to domain names) and trace 
        route information on suspect websites that might be illegally 
        distributing controlled substances and link them to other 
        associated websites.
  --In order to identify and shut down Internet pharmacies violating 
        the Controlled Substances Act, DEA's Diversion Control Program 
        is using all regulatory tools possible, including 
        Administrative Inspection Warrants, registration suspensions, 
        and criminal/civil charges.
  --DEA is using the Automated Reports and Consolidated Order System 
        (ARCOS) to identify high volume purchasers of narcotic 
        controlled substances and to determine which retail pharmacies 
        and practitioners are most likely involved in the illicit 
        distribution of controlled substances over the Internet.
  --In August 2005, DEA began its Distributor Initiative Program. Since 
        that time DEA has been meeting with representatives of the 
        pharmaceutical industry to educate them on the issue of illegal 
        diversion via the Internet. Through this program DEA has sought 
        the cooperation of the distributors of controlled 
        pharmaceuticals to increase their due diligence in order to 
        prevent further diversion of controlled substances. As a result 
        of this program, 24 distributors working out of 129 
        distribution outlets have voluntarily stopped selling or 
        voluntarily restricted sales of controlled substances to 
        hundreds of domestic pharmacies that were attempting to make 
        suspicious orders from the distributors. Each distribution 
        outlet is registered with DEA and each can loose its 
        registration independently of the other outlets.
  --DEA has worked with Internet search engines such as Google, AOL, 
        and Yahoo to create links to DEA's Diversion Website. These 
        links are designed to appear when consumers attempt to buy 
        controlled substances online without the requisite medical 
        exams and prescriptions. In 2005 and 2006, these links appeared 
        more than 72.9 million times.
  --DEA has initiated over 218 investigations of online sales of 
        controlled substances without a prescription through the end of 
        fiscal year 2006. DEA initiated an additional 11 investigations 
        during the first quarter of fiscal year 2007.
  --As a result of Internet investigations, DEA seized approximately 
        $30 million in cash, bank accounts, property, and computers 
        during fiscal year 2006. In fiscal year 2005, Internet 
        investigations resulted in $34.5 million in seizures, a 190 
        percent increase over fiscal year 2004 ($11.9 million). 
        Internet investigations have resulted in the seizure of $13 
        million during the first quarter of fiscal year 2007.
  --DEA has developed a close working relationship with Internet 
        Service Providers (ISPs), Voice over Internet Protocol (VoIP) 
        providers, and email providers from around the world to include 
        Microsoft, Vonage, Google, Time Warner, and AT&T. These 
        providers have supplied DEA with a secure method to deliver 
        data from the provider to DEA field agents for an immediate 
        enforcement response.
  --DEA routinely meets with other members of the law enforcement 
        community from around the world. DEA has built an extensive 
        cooperative relationship with other federal agencies to include 
        FBI, Secret Service, ICE, and the U.S. Marshals Service. With 
        the cooperation of these federal counterparts, DEA is able to 
        leverage unparalleled engineering expertise for the design and 
        implementation of technical solutions that ensure law 
        enforcement's ability to lawfully intercept emerging 
        technologies.
  --DEA implemented a Technology Working Group (TWG) to address 
        technical issues associated with Internet intercepts. The TWG 
        routinely meets with members of the Internet industry and 
        becomes educated on new technologies that could affect DEA, 
        either positively or negatively. The TWG gathers and reviews 
        reports from our field offices that discuss technologies and 
        the obstacles associated with these technologies. The TWG 
        follows up with the respective field agents to become more 
        familiar with the technologies and how they effect DEA's 
        operations. If the collected intelligence needs to be 
        disseminated to additional sections within DEA or the law 
        enforcement community, the TWG is responsible for ensuring that 
        data is disseminated appropriately.
  --In 2005, DEA hosted interagency meetings with executive level 
        representatives from over two-dozen corporations in three key 
        industry groups (Internet, express parcel delivery, and 
        financial) used by Internet pharmaceutical traffickers. Since 
        those meetings, DEA has developed progressively closer working 
        relationships with the leading corporations in each industry 
        sector and has coordinated interagency outreach to these same 
        corporations. These industry relationships are intended to: (1) 
        promote information sharing within the private sector and with 
        DEA to proactively identify and target major Internet 
        controlled pharmaceutical traffickers; and (2) identify and 
        share best practices across industry groups to more effectively 
        deny the use of business services by Internet controlled 
        pharmaceutical traffickers.
    Question. Given the large number of new encrypted communication 
devices entering the market, how does DEA stay up with this evolving 
technology?
    Answer. The use of encrypted communications by drug trafficking 
organizations is becoming more prevalent. To counter this, DEA is an 
active participant in a number of technology working groups and 
routinely meets with law enforcement and intelligence agencies from 
around the world to discuss intercept solutions for emerging encryption 
devices. DEA also employs a highly specialized staff of engineers that 
test, develop, and evaluate solutions to defeat or minimize the impact 
of encrypted communications in use by criminal organizations.
    DEA's Office of Investigative Technology, is responsible for the 
design, development, and implementation of technical solutions for the 
lawful intercept of Internet-facilitated communications utilized by 
drug trafficking organizations. However, the complexity and costs of a 
single data network intercept is often overwhelming for law 
enforcement. Furthermore, traditional technologies available to law 
enforcement for data network intercepts are vulnerable to organizations 
that utilize multiple access points for data communications or encrypt 
their communications using high level encryption protocols.
    In the fiscal year 2008 President's budget, DEA requests $1,000,000 
to improve and expand its Internet investigative technologies to combat 
the evolving methods used by drug trafficking organizations. This 
funding will be used to develop and purchase intercept solutions for 
emerging Internet technologies, including data intercept solutions that 
can be placed on a targeted computer to covertly capture all 
communications authorized by a Title III court order. Since the 
intercept solution actually resides on a subject's computer, mobility 
of a target that accesses the Internet through multiple service 
providers can be overcome. Also, encrypted communications can be 
intercepted as the software is able to capture communications in their 
unencrypted state, rather than when they are in transit and secure.
    Ongoing investigations limit DEA's ability to provide specific 
details on the methods and use of this encrypted communication 
technology. However, this enhancement will provide DEA with the 
technical capacity to address certain types of communications that 
cannot be intercepted through conventional methods. The challenge 
facing DEA on these ongoing investigations is that the drug trafficking 
organizations increasingly communicate by means of encryption among 
their associates regarding transportation, distribution routes, and 
money laundering activities. To make it more difficult, some of these 
encrypted email service providers and peer-to-peer communication 
networks are foreign based companies not subject to our laws. 
Therefore, the inability of domestic law enforcement to exploit these 
encrypted communications has allowed the criminal organizations to 
operate with impunity and prohibit the intercept from realizing its 
full investigative potential.
    There are several ongoing investigations that have been adversely 
impacted by the use of encryption by the targeted organizations. For 
example, drug trafficking and money laundering organizations have 
directed members of their organization to use encrypted email service 
providers and peer-to-peer communication networks to facilitate, 
organize, and conduct criminal acts. Drug traffickers have also learned 
to converse over the Internet and on their cell phones using one or 
more encrypted methods. These methods range from sending and receiving 
calls, sending instant messages, and viewing information over an 
encrypted email service and/or peer to peer communication network. 
Additionally, the drug trafficker or money launderer has the ability to 
use a cell phone or computer device with minimal knowledge, identity, 
and cost.
    Question. In your testimony, Administrator Tandy, you identify a 
problem with online pharmacies. What are the challenges these online 
drug stores present to the DEA?
    Answer. The illicit trafficking of controlled pharmaceuticals has 
been facilitated by the wide use of the Internet and the anonymity it 
provides. The existence of readily available drugs on the Internet is a 
great concern because of the potential for abuse and the potential 
safety issues that revolve around what is largely an unregulated 
process. A July 2006 Department of Justice, Office of the Inspector 
General report states, ``The increase in the diversion of controlled 
pharmaceuticals has coincided with the emergence of the Internet as a 
significant source for diverted pharmaceuticals. Hundreds of Internet 
pharmacies have been established through which large amounts of 
pharmaceuticals can be easily purchased with a credit card and without 
a prescription.'' \5\ Much of the problem revolves around third-party 
businesses operating websites that facilitate a doctor's ability to 
write, and a pharmacy to fill, numerous prescriptions without a face-
to-face visit.
---------------------------------------------------------------------------
    \5\ Follow-Up Review of the Drug Enforcement Administration's 
Efforts to Control the Diversion of Controlled Pharmaceuticals. DOJ, 
Office of the Inspector General, July 2006.
---------------------------------------------------------------------------
    DEA investigations indicate the Internet is the fastest growing and 
one of the largest sources of diverted controlled substances. The 
volume of controlled substances being diverted by a single rogue 
pharmacy dispensing via the Internet poses a major threat. For example, 
in fiscal year 2006, DEA identified 34 known or suspected rogue 
pharmacies dispensing controlled substances via the Internet. 
Cumulatively, these pharmacies dispensed 98,566,711 dosage units of 
hydrocodone-based products in 2006. It would take 1,118 legitimate 
pharmacies to dispense the same amount of hydrocodone-based products as 
these 34 rogue Internet pharmacies did in 2006.\6\
---------------------------------------------------------------------------
    \6\ Source: ARCOS data. In 2006, the average U.S. pharmacy 
dispensed 88,178 dosage units of hydrocodone.
---------------------------------------------------------------------------
    Online investigations also require more resources than traditional 
diversion investigations because a large amount of data is retrieved 
and processed during online investigations. For example, Internet 
online pharmacy cases require a cadre of highly skilled engineers to 
develop customized intercept solutions. On average, a major online 
investigation conducted by DEA costs $1.5 million (including salaries 
and operational costs) and requires 27,800 work hours (based on five 
recent major online investigations). In comparison, a typical diversion 
investigation costs $220,000 and requires 3,800 work hours. However, 
online investigations may not require the same amount of resources as 
large non-diversion cases with extensive Title III investigations. For 
example, the recent Operation Three Hour Tour cost $2.4 million and 
required 48,000 work hours.
    One lawful intercept or Title III can reveal hundreds to thousands 
of users. Operation CyberRX was one of DEA's largest Internet 
intercepts and intercepted over 6,500 individuals purchasing 
pharmaceuticals illegally. The volume of data collected during this 
investigation required the deployment of additional resources. As a 
result, the Fort Worth Resident Office has seized over $19 million in 
cash and assets and 19 individuals were arrested.
    Finally, online pharmacies that operate outside of the United 
States and its territories pose legal and technical issues for DEA. 
Internet Service Providers (ISPs) operating within the United States 
are generally responsive to lawful orders issued by U.S. courts. 
However, DEA's regulatory authority and Administrative Subpoena 
authority does not extend to the foreign-based ISPs, companies, or 
pharmacies. Furthermore, DEA is unable to measure the exact number of 
rogue ``pharmacies'' operating outside the United States. A Google 
search may reveal thousands upon thousands of ``sites'' that offer 
controlled pharmaceuticals however many of these sites are transient 
and illusive, taking advantage of the anonymity afforded by the 
Internet. Experience has also shown that many of these are referral 
sites and are not ones that would ultimately fill an order. It is 
usually difficult, if not impossible, to trace where international 
sites are physically located. Some investigations have revealed that 
the web site may be located in one country, while the ``pharmacy'' is 
located in another, and the money is received in yet a third country. 
Often times the international ``pharmacy'' is not a pharmacy at all and 
the products that are shipped may be diluted or counterfeit substances.
    Question. Are there additional legal authorities you need to assist 
you in this war?
    Answer. The Administration is looking at a wide range of potential 
legislative measures. DEA wants to stop the illegitimate online 
pharmacies while ensuring that legitimate pharmacies and doctors are 
able to effectively use the Internet.
    Since the advent of the Internet law enforcement has encountered 
numerous obstacles and challenges. The ``Technological Revolution'' has 
opened new and evolving legal hurtles never before faced by any 
previous generation. Though designed for the benefit of society, the 
Internet has allowed criminals the ability to continue their activities 
while maneuvering through cyberspace under the cloak of anonymity. 
Traditional crimes such as child pornography, identity thefts, drug 
diversion, and fraud are able to flourish in cyberspace. Daily, law 
enforcement, attorneys, legislators, and the courts are all faced with 
new issued brought about by the Internet. Yesterday's laws are often 
inappropriate, outdated, or inadequate to deal with crimes that evolve 
so quickly. Compounding the problem is the fact that often there are 
parallel issues involving the use of the Internet for legitimate and 
well intended purposes. It is therefore vital that when laws are 
drafted to deal with matters as important as the diversion of 
controlled substances that they will withstand the test of time. The 
Drug Enforcement Administration is always willing to provide Congress 
with whatever technical assistance it can for legislators to determine 
what laws they deem appropriate and necessary.
                              surveillance
    Question. The drug cartels are spending millions to overcome your 
surveillance, even conducting counter surveillance activities on the 
DEA.
    What are the cartels doing to make surveillance more difficult?
    Answer. DEA has gathered intelligence that traffickers both in the 
United States and outside the United States have become more 
technologically advanced in an effort to divert law enforcement. 
Devices that are used everyday as a secure means of communication pose 
a threat to law enforcement and its capability to conduct lawful 
intercepts. These devices provide a secure means of viewing and sending 
data over a handheld device (such as a Blackberry) via a foreign based 
company server. This is further accomplished utilizing proprietary 
company software that has the ability to encrypt the data, sent over a 
U.S. based cellular provider's network to a recipient's communication 
device that contains the proprietary software needed to decrypt the 
data. Should U.S. law enforcement intercept this encrypted data 
anywhere between the sender and the recipient, we would not be able to 
decrypt the communications due to its high level encryption algorithms.
    Drug cells operating around the world are aware of the complexity 
in conducting intercepts, whether it is on a telephone or a computer. 
The availability of wireless ``hotspots'' and cybercafes adds to the 
complexity of conducting intercepts because a target is able to utilize 
a laptop computer or an Internet enabled device to access the Internet 
where he/she can use email, oversee financial assets, and make Voice 
over Internet Protocol (VoIP) calls using multiple Internet Service 
Providers (ISPs). Law enforcement does not have the ability to deploy 
mobile intercept equipment from ISP to ISP due to the complexity of 
these intercepts. However, if intelligence is able to determine a 
pattern on a subject's use of the Internet, we can then begin to target 
the provider in hopes of deploying an intercept.
    The use of VoIP services is becoming more common mainly because of 
the low cost of these services. Although DEA is able to intercept VoIP 
communications and routinely does so, providers are beginning to offer 
features such as encryption and peer-to-peer communications for added 
security. One of the most recognizable vendors in this area is Skype 
Communications. Skype is free software that is downloaded off of the 
Internet which allows for encrypted VoIP and instant messaging 
communications between customers that have also downloaded Skype's 
software. The communications only require Internet connectivity to 
facilitate the communications. The communications are not delivered 
through a traditional ISP server but rather each Skype user allows for 
the facilitation of communications over a peer-to-peer network. The 
data delivery of these communications takes an unpredictable route 
making it almost impossible to intercept. Furthermore, if the data was 
intercepted it would be in an encrypted format that would be almost 
impossible to crack. DEA has also observed several additional email 
providers that market their encrypted email features for little or no 
charge.
    Traffickers transiting the high seas on commercial maritime 
vehicles and the Caribbean on go-fast boats also make surveillance 
difficult by communicating by satellite telephones. While DEA has used 
satellite telephone intercepts and maritime tracking devices to 
successfully locate and seize vessels laden with drugs, satellite 
telephone intercepts are extremely costly. For example, there are 
instances where satellite telephone companies are not CALEA compliant 
and DEA must engineer an intercept solution to glean investigative 
information.
    In the fiscal year 2008 President's budget, DEA requests $3,100,000 
for improved satellite telephone and maritime tracking resources, as 
well as additional linguist funding and data collection capabilities.
    In fiscal year 2008, DEA also requests $2,000,000 for tracking, 
sensor, and audio/video surveillance equipment. Surveillance equipment 
is particularly crucial in areas such as the Southwest Border (SWB) 
because it is a major point of entry with few realistic controls. 
Cartels are also building sophisticated encrypted radio networks along 
the SWB for command and control. Surveillance equipment, such as remote 
cameras, tracking devices, and alarms, are one of the only ways to 
cover such an expansive area. DEA field divisions along the SWB employ 
a variety of sophisticated audio and video surveillance equipment 
including mobile surveillance platforms, digital equipment with 
Internet connectivity, mobile x-ray equipment, microwave automated 
repeater systems, and scanners for monitoring radio frequencies. Much 
of this equipment is a ``force multiplier'' because agents do not need 
to be physically present to monitor the surveillance, which enables 
them to be more productively used elsewhere.
    In regards to counter surveillance, it has become more commonplace 
for drug traffickers and drug trafficking organizations to use 
sophisticated countermeasures to detect electronic surveillance 
signals. The most frequently used countermeasure devices are radio 
frequency (RF) detectors, frequency counters, and scanners.
    A radio frequency detector identifies devices which transmit RF 
signals within the operating parameters of the detector. RF 
transmitters used by law enforcement agencies for surveillance purposes 
convey audio, video, and data from one location to another. RF 
detectors are commonly used by legitimate industry technicians to 
locate frequencies, identify unwanted signals, and interference which 
contribute to degradation of RF signals. These devices are also used 
for more nefarious purposes by criminals for the purpose of identifying 
electronic surveillance by law enforcement. RF detectors, from basic 
inexpensive types to expensive sophisticated models, are widely 
available through Internet vendors as well as stores commonly referred 
to as ``spy shops.''
    A frequency counter is a device that determines the frequency 
emitting from a transmitter. The are two basic types of frequency 
counters, one that will determine the exact frequency of analog 
transmissions, and one that will determine the exact frequency of 
either analog or digital transmissions. A scanner is used to identify 
radio emissions in a given area.
    RF detectors, frequency counters, and scanners are used in concert 
to complete an effective, electronic ``sweep'' of an area for RF 
signals. Criminal organizations are known to retain highly paid private 
detective firms or other vendors specializing in providing electronic 
``sweeps'' of homes, offices, vehicles, or other conveyances and 
locations to identify electronic surveillance devices.
    Question. What is DEA doing to overcome these obstacles?
    Answer. DEA employs a cadre of Engineers and Telecommunications 
Specialist to develop, test, and implement technical intercept/
surveillance solutions. The equipment that is utilized to develop these 
solutions is very complex and very costly. The skill set these 
employees possess is very unique and requires a great deal of training 
in order to evolve as quickly as technology dictates.
    DEA has also developed minimization software for data intercepts 
that enables law enforcement to view or listen to intercepted 
communications just as a target would view or listen to it. The 
software that is utilized during Internet intercepts is constantly 
being updated to conform to the Internet's constantly changing 
protocols. DEA provides this software to other federal agencies, as 
well as State and local law enforcement agencies.
    The ISPs that DEA routinely works with also advise DEA of new 
technologies prior to their release to the general public. This enables 
DEA to proactively develop solutions which will allow DEA to have 
intercept solutions in place should an investigation require them. This 
provides minimal turnaround time and allows the data to be expedited to 
the field.
    Finally, DEA continues to work with industry, the field, and other 
federal, State and local agencies to research, develop, and employ both 
active and passive surveillance countermeasures.
                              met program
    Question. Administrator Tandy, the Mobile Enforcement Team (MET) 
program has proven to be very successful in assisting State and local 
law enforcement agencies in addressing their communities' drug threats. 
The Budget proposed to eliminate the MET program.
    How will DEA respond to requests for assistance from State and 
local law enforcement without the MET program?
    Answer. MET is not the only DEA program that benefits State and 
local law enforcement. In addition to the MET program, DEA leads over 
200 State and local task forces, including over 1,600 DEA Special 
Agents and over 2,100 State and local task force officers, all of whom 
are dedicated full time to address drug trafficking, including 
trafficking in our local communities.
    Despite the elimination of the MET program, DEA will continue to 
work side-by-side with our State and local law enforcement partners by 
sharing intelligence and providing training to them. DEA assists State 
and local law enforcement in many ways, for example:
  --DEA's EPIC Open Connectivity Project provides web-based access to 
        approximately 1,800 Federal, State, and local partners on an 
        annual basis. Users can query and access law enforcement data 
        maintained by EPIC.
  --In fiscal year 2006, DEA shared $274 million in State and local 
        proceeds with State and local law enforcement, a 25 percent 
        increase over the $219 million shared in fiscal year 2005, 
        including a 40 percent increase in the funds shared with 
        Sheriffs. This level of sharing is expected to continue.
  --In fiscal year 2006, DEA trained over 41,000 S&L officers, 
        including over 1,000 in meth lab clean up and training.
  --By the end of 2008, DEA plans to complete a clandestine laboratory 
        training facility to better train more State and local 
        officers.
                   united states/mexico collaboration
    Question. Administrator Tandy, State and local law enforcement 
officers are the ``end-users'' that deal with the drugs and violence 
proliferated by Mexican drug trafficking organizations. Historically, 
the government of Mexico has not been a strong ally in addressing this 
threat.
    What is your assessment on America's current working relationship 
with the Mexican government on combating drug trafficking 
organizations?
    Answer. Under the Calderon Administration, our relationship with 
Mexico has experienced unprecedented levels of cooperation and 
solidarity in combating drug trafficking organizations. Specifically, 
DEA is working hard with the Government of Mexico to target the 
criminal organizations involved in the diversion of precursor chemicals 
and the producing and trafficking of methamphetamine. Relations between 
Mexican authorities and DEA are at an all time high in terms of 
chemical control. Mexico has imposed import quotas tied to estimates of 
national needs. The Mexican Government limited pseudoephedrine, 
ephedrine, and combination product importation permits to 70 tons 
during 2006; this is a reduction of 53 percent from the 2005 level of 
imports (150 tons). This quota has made it more difficult for 
traffickers to obtain precursor chemicals. Prices have increased and 
traffickers have been forced to resort to traditional diversion 
methods, including smuggling and the use of third countries to procure 
their chemicals. In addition, intelligence indicates that traffickers 
have also turned to alternate production methods for methamphetamine 
and the apparent use of substitute chemicals as the traditional 
precursors are becoming more difficult to obtain. Mexico has discussed 
revising their quota downward even further in 2007.
    In May 2006, at the National Methamphetamine and Chemicals 
Initiative (NMCI) Strategy Conference in Dallas, Attorney General 
Gonzales announced important new anti-methamphetamine domestic 
initiatives, as well as new partnerships between the United States and 
Mexico in fighting methamphetamine trafficking. These initiatives will 
improve enforcement and information sharing, increase law enforcement 
training, and increase public awareness both domestically and 
internationally. Since this announcement, methamphetamine enforcement 
teams have been formed on both sides of the border and DEA has donated 
8 refurbished clan lab trucks to Mexico. Additionally, DEA and DOS/INL 
trained over 2,000 Mexican officials in 2006 on a variety of 
investigative, enforcement, and regulatory methods related to 
methamphetamine trafficking and manufacturing. This training included 
instruction on clandestine laboratory investigations, precursor 
chemical investigation, and drug identification.
    DEA has also expanded the role of its Clan Lab Enforcement Teams to 
target Mexican methamphetamine trafficking organizations. These teams 
are using their lab expertise to trace chemicals, finished 
methamphetamine, and drug proceeds to drug trafficking organizations in 
the United States and Mexico. These teams are also working to identify 
and dismantle U.S.-based methamphetamine transportation and 
distribution cells.
    The United States also enjoys an excellent extradition relationship 
with Mexico, which has served both countries well in the administration 
of justice. In 2006, for the fifth consecutive year, Mexican 
authorities extradited a record number of fugitives to the United 
States. In 2006, there were 60 extraditions from Mexico to the United 
States. Twenty-six of these extraditions were for drug charges, 
including 24 Mexican nationals. In 2005, Mexico extradited 41 fugitives 
to the United States--up from 34 in 2004.
    The new administration of President Calderon has taken a strong, 
proactive stance against drug traffickers and the associated violence. 
On January 19, 2007, Mexico extradited 15 offenders to the United 
States, a significant number of which have U.S. narcotics trafficking 
and related charges. Notably, the leader of the Gulf Cartel, Osiel 
Cardenas-Guillen, two high-level members of the Tijuana Cartel, two 
mid-level members of the Juarez Cartel, and three high-level and two 
mid-level members of the Federation were extradited.
    DEA works closely with its Sensitive Investigative Unit (SIU) in 
Mexico. As of December 31, 2006, the Mexican SIU consists of nearly 300 
Federal Investigations Agency, Federal Preventive Police, and SIEDO 
(federal prosecutors). Furthermore, during 2006, under DEA direction, 
2,161 agents of the AFI and the Policia Federal Preventiva and other 
Mexican personnel were trained by DEA and State Department funded 
contractors on clandestine laboratories, officer/first responder 
safety, and chemical identification. DEA also provided training to both 
Mexican prosecutors and law enforcement as part of a month-long course 
at the DEA Training Academy in Quantico, Virginia.
    The Bilateral Intercept Program is an unparalleled initiative 
between DEA and the Government of Mexico which has developed a 
comprehensive wire intercept program by utilizing the SOD methodology 
of simultaneously targeting international drug trafficking 
organizations throughout the United States and Mexico. Early successes 
have indicated cooperation between DEA and Government of Mexico will 
only continue to expand coordinated law enforcement efforts.
    Operations All Inclusive 2005-1 and 2006-1 is another example of 
DEA and Government of Mexico cooperation. These operations ran from 
August 5, 2005 through October 8, 2005, and March 4, 2006 through April 
26, 2006, respectively, and targeted South American source regions, 
Eastern Pacific and Western Caribbean vectors of the Mexico/Central 
America transit zones, and the Mexico and Central America land mass, by 
attacking the drug trade's main arteries and support infrastructure 
with innovative, multi-faceted, and intelligence-driven operations. 
Both operations exploited the maritime, overland, commercial air, and 
private air smuggling vulnerabilities in the movement of drugs, money, 
and chemicals. DEA and other federal, State, and host nation law 
enforcement and military agencies supported both operational and 
intelligence aspects of these operations.
    Operation All Inclusive 2005-1 seizure highlights in Mexico include 
21.05 metric tons of marijuana, 108 kilograms of cocaine, 35.2 
kilograms of heroin, and nearly 1 million tablets of pseudoephedrine. 
Of particular importance were two currency seizures at the Mexico City 
Airport totaling $8.7 million. One seizure totaling $7.8 million, which 
was eventually linked to members of the Mexican ``Federation,'' is the 
largest currency seizure to date at the Mexico City International 
Airport. During this operation, over 46 metric tons of cocaine were 
interdicted and seized before they could reach Mexico, where the drugs 
are normally broken down into smaller quantities for transshipment 
north and to make them more difficult to interdict. Additionally, 3.5 
metric tons of cocaine seized from the fishing vessel Vega in the 
Eastern Pacific Ocean on August 15, 2005, was linked to Colombian PTO 
Herman Vasquez-Sanchez and an alleged Mexico City-based recipient who 
were identified through wire intercepts. Operation All Inclusive 2006-1 
highlights included the arrest of three pilots and the seizure of a DC-
9 and Dassault Falcon Jet aircraft and 5.6 tons of cocaine at the 
Ciudad de Carmen Airport, Campeche, Mexico. Also, nearly 17 metric tons 
of marijuana and 10.4 kilograms of heroin were seized. Thirty-eight 
metric tons of cocaine were interdicted and seized before they could 
reach Mexico.
    Question. What does the future hold for increasing DEA-Mexican 
cooperation?
    Answer. In addition to enforcement assistance and the development 
of new enforcement strategies, DEA will continue to offer training to 
the Government of Mexico. In fiscal year 2006, under DEA direction, 
over 2,000 agents of the AFI and the Policia Federal Preventiva and 
other Mexican personnel were trained by DEA and State Department funded 
contractors on clandestine laboratories, officer/first responder 
safety, and chemical identification.
    DEA will also continue to work with the Government of Mexico to 
obtain the extradition of high value targets such as occurred on 
January 19, 2007; when Osiel Cardenas Guillen, a CPOT and the leader of 
the notorious Gulf Cartel which is headquartered in Matamoros, Mexico; 
who was responsible for much of the ``narco-violence'' on the Southwest 
Border was turned over to the DEA by the Government of Mexico to face 
drug charges in U.S. Federal Court.
    DEA will also continue working with the Government of Mexico on 
future iterations of Operation All Inclusive. Recognizing that the 
United States cannot control its borders by merely enforcing the 
immediate border, DEA's International Drug Flow Attack Strategy 
incorporates a ``defense in depth'' component by attacking the source 
and transit zone. This model has successfully been applied 
internationally in two deployments and is in the beginning stages of a 
third operation (Operation All Inclusive 2007-1). A fourth iteration 
focuses on the Southwest Border and is called Operation Doble Via. 
Operation Doble Via is a combination of staggered and simultaneous 
U.S./Mexico enforcement operations combined with intelligence driven 
enforcement operations designed to influence illicit trafficking 
patterns and increase disruptions to violent DTOs.
    Operation All Inclusive was developed to attack an entire region in 
hopes of not simply displacing cartels but eliminating them. Operation 
All Inclusive causes major disruption to the flow of drugs, money, and 
chemicals between the source zones and the United States. To 
effectively combat drug trafficking in Central America, Mexico, and the 
transit zone, the United States must maintain a sustained, multi-agency 
approach. The DEA focuses on improving the region's counter drug 
capabilities through developing personal liaisons with host nation law 
enforcement authorities, institution building with host nation 
governments, and by attacking the command and control structures of 
major drug trafficking organizations.
                               marijuana
    Question. Administrator Tandy, marijuana abuse is one the most 
significant drug challenges currently faced by law enforcement 
agencies. The majority of domestically cultivated marijuana is being 
grown on public lands in our national parks and forests. These 
marijuana plots are being aggressively defended by armed Mexican drug 
cartels, making our national treasures unsafe for public use.
    Do you agree with this assessment?
    Answer. The Department of Agriculture, Forest Service (USDA, FS) 
and agencies of the Department of the Interior (DOI) continue to detect 
significant increases in marijuana cultivation on federal public lands 
nationwide. These findings correspond to reports of expanded domestic 
cannabis cultivation and marijuana production. Domestic cannabis 
eradication data for 2005 shows the highest level of cannabis 
eradication ever recorded. In 2005, 4.2 million plants were seized 
compared to 3.7 million in 2003, the next highest level in the years 
2000-2005.\7\
---------------------------------------------------------------------------
    \7\ National Drug Threat Assessment 2007. National Drug 
Intelligence Center, U.S. Department of Justice, October 2006.
---------------------------------------------------------------------------
    The cultivation of marijuana on public lands is dominated by 
loosely organized, poly-drug Mexican drug trafficking organizations 
(DTOs) employing illegal Mexican aliens for the production and 
distribution of marijuana and methamphetamine nationwide. The violence 
and environmental risks associated with this cultivation is growing, 
therefore DEA is striving to halt the spread of marijuana cultivation 
in the United States by focusing various federal, State, and local law 
enforcement efforts towards identifying and dismantling the DTOs 
directing and controlling this activity.
    Question. What is DEA's strategy to address this growing threat?
    Answer. To address this threat, DEA has initiated a public land 
working group comprised of affected federal land management agencies. 
DEA is examining how best to leverage the available resources of our 
federal partners through better sharing of intelligence and targeting 
of these DTOs. Critical to this strategy will be the collection and 
sharing of intelligence concerning the communications devices and 
techniques used by those growing marijuana on our public lands. Federal 
land management agencies have confirmed their commitment to sharing 
intelligence with DEA. With the intelligence gathered, DEA will 
identify and attack the Mexican organizations that direct and control 
the cultivation and distribution.
    Marijuana cultivation on public lands presents a number of 
enforcement challenges, including the need for air support and large 
numbers of law enforcement personnel to safely and successfully 
accomplish eradication missions. DEA has the mechanisms in place 
through the Special Operation Division, the Fusion Center, and the El 
Paso Intelligence Center to add value to intelligence from marijuana 
enforcement operations on public lands and to coordinate and expand 
investigations beyond simple plant eradication to attacking the 
controlling DTOs. DEA has offered this established strategy and 
available resources to the FS and DOI, as well as additional training 
and access to intelligence information.
    DEA is also working with the Park Service and Forest Service to 
cross-designate selected Park Service and Forest Service law 
enforcement officers to work on specific cases with DEA, or to serve on 
DEA task forces. Unilateral Title 21 investigations by the DOI or the 
Forest Service would lack the coordination necessary to ensure the 
safety of law enforcement personnel, and would not permit de-
confliction with other domestic and foreign investigations.
    In addition to enforcement efforts, DEA's Domestic Cannabis 
Eradication/Suppression Program (DCE-SP) works with our participating 
State and local partners to target marijuana wherever it is produced 
throughout the United States and its territories, on both public and 
private lands. The DCE/SP is an enforcement activity which provides 
funding, operational support, and training to participating State and 
local agencies. The program strives to halt the spread of marijuana 
cultivation throughout the United States and is responsible for the 
investigation and eradication of both indoor and outdoor cultivation of 
the illicit crop.
                                 ______
                                 
             Question Submitted by Senator Pete V. Domenici
                            dea nm resources
    Question. I believe that the DEA plays a critical role in law 
enforcement activities in New Mexico. State and local law enforcement 
agencies reap vast benefits while working alongside these federal 
agents. I am concerned that the smaller communities in my home state 
may not be able to take advantage of these federal partnerships. This 
is especially problematic because community population is neither a 
variable nor a predictor of drug use.
    Can you please explain what type of interaction DEA agents have 
with smaller communities and what we might be able to do to ensure that 
all our communities benefit by working with federal law enforcement 
agents?
    Answer. As with all federal agencies, the DEA concentrates the bulk 
of its offices and agents in the highest population areas in an attempt 
to maximize our efforts and effectiveness. DEA has limited manpower and 
resources, as do all other law enforcement agencies throughout the 
United States. DEA has found that the most effective method to increase 
productivity, improve our responsiveness to State and local agencies, 
and ensure that all communities benefit from a federal law enforcement 
presence is through the employment of multi-agency task forces. The 
task force concept provides several advantages to all participating 
agencies: DEA is able to draw on the expertise of State of local law 
enforcement; DEA can share resources with State and local officers, 
thereby increasing the investigative possibilities available to all; 
State and local officers can be deputized as federal drug agents, thus 
extending their jurisdiction; State and local participating agencies 
can receive an equitable share of forfeited drug proceeds; and DEA can 
pay overtime and investigative expenses for the State and local 
agencies.
    In New Mexico, DEA has two offices located in Albuquerque and Las 
Cruces. The Albuquerque District Offices (DO) is staffed with 33 
Special Agents (including four supervisory Special Agents). The Las 
Cruces Resident Office (RO) is staffed with 17 Special Agents 
(including three supervisory Special Agents). The Albuquerque DO and 
the Las Cruces RO each support two federally funded multi-agency task 
forces. The addition of ten task force officers in Albuquerque and nine 
task force officers in Las Cruces provides DEA with a more than 35 
percent increase in agent strength, which is subsequently leveraged to 
cover a vast area of responsibility. The addition of task force 
officers also prompts parent agencies to regularly interact with DEA. 
This representation of local community concerns also often promotes the 
presentation of cases for extended federal investigation and 
prosecution.
    Additionally, the State of New Mexico is currently divided into 
seven Bureau of Justice Assistance regions. Throughout New Mexico, 
State and local law enforcement agencies are provided with federal 
funds to organize and implement multi-agency task forces within each 
respective region. Again, the task forces permit State and local law 
enforcement agencies--within a specific geographic area--to pool 
resources and information that consequently maximize effort and 
effectiveness. DEA Special Agents are designated by management to 
interact with each regional task force. This practice encourages 
smaller and more isolated local agencies to interact more meaningfully 
with DEA.
    Task forces, by their very nature, are designed to facilitate the 
exchange of information at the federal, State and local levels. This 
information exchange allows for the development, coordination, and 
prosecution of targeted members and their criminal organizations. In 
order to avoid duplicative efforts, agents and task force officers 
routinely rely on the free exchange of information between our State 
and local counterparts, coupled with DEA information systems, such as 
NADDIS, to identify potential conflicts between competing 
jurisdictions. Moreover, current DEA policy mandates that communication 
devices suspected to be used by targets in DEA investigations be 
checked against DARTS prior to any enforcement operation.
    The task force concept has proven to be very successful. In fiscal 
year 2006, the New Mexico DEA offices conducted investigations from 
Raton to Las Cruces and Gallup to Portales, as well as in nearly every 
modestly populated area within proximity. The two DEA offices in New 
Mexico initiated 468 cases, effected 659 arrests, and seized over 
70,000 pounds of marijuana, 1,898 pounds of cocaine, 159 pounds of 
methamphetamine, 16 pounds of heroin, and over 4.5 million in drug 
trafficker currency and assets.
                                 ______
                                 
               Question Submitted by Senator Ted Stevens
                            methamphetamine
    Question. What is DEA doing about methamphetamine in Alaska?
    Answer. DEA's Anchorage District Office (DO) prioritizes its assets 
by targeting the highest level drug trafficking organizations (DTOs) 
which can be identified in the state of Alaska. Recognizing the 
devastation caused by methamphetamine, the Anchorage DO puts forth 
considerable effort to combat the methamphetamine problem through a 
coordinated strategy that includes a comprehensive interdiction effort, 
conducting complex investigations into organizations responsible for 
trafficking drugs into Alaska, targeting clandestine methamphetamine 
laboratories, conducting methamphetamine training and certification to 
State and local counterparts, funding and coordinating all hazardous 
waste clean-ups of clandestine methamphetamine laboratories, as well as 
keeping up a strong demand reduction program that educates youth, bush 
villages, and civic groups.
    The Anchorage DO is part of the Seattle Field Division (FD). 
Historically, Anchorage was a Resident Office (RO) with one GS-14 
supervisor and 6 Special Agents (SA), for a total of 7 SA positions. 
However, in March 2002, DEA upgraded the Anchorage RO to a DO through 
the addition of a second GS-14 supervisor and a GS-15 Assistant Special 
Agent in Charge (ASAC), for a total of 9 SA positions. Additionally, in 
September 1999, DEA opened a Post of Duty in Fairbanks, Alaska. This 
office has two Special Agent positions.
    Prior to the March 2002 upgrade, the Anchorage office operated a 
Drug Task Force with 5 Task Force Officers (TFOs). The Anchorage DO now 
has 7 TFOs. Furthermore, at any given time 10-15 additional State and 
local officers are deputized (on a case specific basis) to assist in 
major investigations. As of May 2007, 12 State and local officers are 
deputized. The Anchorage DO is co-located with the Anchorage Police 
Department (APD) Metro Narcotics Unit and the Alaska State Troopers 
(AST) Major Offenders Unit (MOU).
    DEA intelligence indicates that, in accordance with national 
trends, most of the methamphetamine found in communities throughout 
Alaska originates from the Southwest Border of the United States. DTOs 
following trafficking routes through cities such as Las Vegas, NV, 
Tucson, AZ, and Seattle, WA, where the meth is repackaged and 
distributed through parcel service to Anchorage. Methamphetamine 
wholesale prices in Seattle range from $3,000 to $4,000 per pound 
compared to wholesale prices of $18,000 to $20,000 per pound in 
Anchorage, making Alaska a lucrative destination.
    The Anchorage DO Airport Interdiction Task Force (AITF) covers the 
entire State and is supervised and staffed by DEA Special Agents, as 
well as AST Investigators, Airport Police Officers, and National Guard 
Counterdrug Support Program personnel. It prioritizes resources to stop 
drugs as they come into the state of Alaska through interdiction at all 
parcel sorting facilities (FedEx, UPS, U.S. Postal Service, etc.), the 
Port of Anchorage, and the Anchorage International Airport. The AIFT 
has supported several operations in Southeastern Alaska to include a 
joint operation with the Southeastern Alaska-Narcotics Enforcement Team 
and the U.S. Postal Service targeting the parcel shipping facilities in 
Juneau and Ketchikan. Additionally, the AITF targets outgoing flights 
to the bush in an attempt to interdict drugs before they arrive in the 
villages. The Anchorage DO coordinates these efforts very closely with 
State and local counterparts including the AST and the U.S. Postal 
Service.
    In late 2006, the AITF initiated Operation Dip Net in order to 
better coordinate the interdiction efforts of law enforcement agencies, 
and to target those facilities/routes of smuggling that result in the 
seizure of significant contraband. The identified trends allow 
management to better direct law enforcement efforts by physically 
placing interdiction officers in the prevailing illicit drug supply 
route. Since the inception of Operation Dip Net, 14 pounds of 
methamphetamine, over 32 kilograms of cocaine, a half pound of crack 
cocaine, nearly 10,000 Ecstasy tablets, and a bottle of liquid LSD have 
been seized in Alaska. Additionally, approximately $310,000 in U.S. 
currency has been seized, 20 defendants have been arrested, and 23 
firearms recovered or seized as a direct result of the interdiction 
efforts. Operation Dip Net has also put ``look outs'' on particular 
locations with cargo companies.
    Due to its highly lucrative nature, methamphetamine can make its 
way into distribution cells that distribute retail amounts to local 
gangs who further distribute to the user population. To date, there is 
no evidence of methamphetamine making its way into Samoan gang 
distribution cells from sources originating in Samoa. The Anchorage DO 
did seize and subsequently conducted a controlled delivery of four 
ounces of methamphetamine to an individual of Samoan decent, however 
the methamphetamine had been sent to Alaska from Las Vegas.
                                 ______
                                 
                  Questions Submitted to John F. Clark
            Questions Submitted by Senator Richard C. Shelby
                         gulf coast task force
    Question. Director Clark, for fiscal year 2006, the United States 
Marshals Service (USMS) was authorized by Congress to establish a 
Regional Fugitive Task Force in Alabama and Mississippi. Just last 
week, this Task Force arrested Gerald Campbell who was previously 
convicted and sentenced to life in prison for murdering his wife but 
escaped in 1978 from the Alabama Department of Corrections. The Gulf 
Coast Task Force tracked Campbell down and arrested him after 23 years 
on the run.
    Mr. Director what is the status of this task force, and can you 
tell us about some of the other good work they have accomplished?
    Answer. The Gulf Coast Regional Fugitive Task Force (GCRFTF) began 
operations on July 1, 2006. It is the sixth RFTF within the USMS. The 
GCRFTF expects to be fully operational by the end of fiscal year 2007. 
There are five office locations in Alabama: Birmingham, Huntsville, 
Montgomery, Mobile, and in the future, Dothan. The Birmingham office 
serves as task force headquarters and includes a training center 
similar to other RFTFs. There are three office locations in 
Mississippi: Oxford, Jackson, and Gulfport.
    Supporting the GCRFTF are USMS Technical Operations Group (TOG) 
facilities and personnel in Birmingham, Montgomery, and Jackson. There 
are 32 USMS positions authorized and all of these positions have been 
filled. In addition, 100 investigators from 30 law enforcement agencies 
are working in conjunction with the GCRFTF.
    Since its inception, the GCRFTF has made a tremendous impact on the 
region. Below are the statistics from July 2006 to April 2007:

------------------------------------------------------------------------
                                                                Number
------------------------------------------------------------------------
Felony Fugitives Arrested..................................        1,700
Warrants Cleared...........................................        2,246
Arrested Individuals Wanted for Homicide...................          100
Arrested Individuals Wanted for Sex Offenses...............          471
Arrested Individuals Who Were Not in Compliance with Sex             187
 Offender Registry Requirements............................
Firearms Seized............................................           84
------------------------------------------------------------------------

    In addition to arresting Gerald Raye Campbell, a convicted murderer 
who was wanted for escape from the Alabama Department of Corrections 
after 23 years on the run, the GCRFTF has made several significant 
arrests. Below are two additional notable arrests during the month of 
April 2007:
    On April 4, 2007, Jerone Bussey was arrested in Athens, Alabama, by 
members of the GCRFTF and officers from the Athens Police Department 
(APD). Authorities in Indianapolis, Indiana, wanted Bussey for murder 
after he allegedly shot and killed two people with an AK-47 assault 
rifle. One of Bussey's alleged victims was seven and one-half months 
pregnant at the time of the shooting. USMS investigators in the 
Southern District of Indiana developed information indicating that 
Bussey fled to the Athens area. The GCRFTF responded by identifying 
Bussey's probable location in Athens, and established surveillance. The 
GCRFTF, with assistance from marked APD units, conducted a felony stop 
on Bussey's vehicle and took him into custody without incident.
    On April 11, 2007, Kent Steward, a registered sex offender, was 
arrested in Ozark, Alabama, by members of the GCRFTF and officers from 
the Ozark Police Department. Authorities in Ozark wanted Stewart for 
kidnapping and rape of a minor after he allegedly abducted and sexually 
assaulted a ten year old girl. After authorities identified Stewart as 
a suspect, GCRFTF established covert surveillance outside his probable 
location. When investigators later observed a male subject matching 
Stewart's description, they moved in and safely took Stewart into 
custody. Stewart has a previous conviction for rape. If convicted, 
Stewart faces life imprisonment with no possibility of parole.
    Question. The Alabama Mississippi Task Force is the 6th such force 
created by the USMS. Does the agency have a plan to expand this concept 
into other regions of the country?
    Answer. USMS Regional Fugitive Task Forces (RFTFs) consisting of 
``Federal, State and local law enforcement authorities in designated 
regions of the United States'' were established by the Presidential 
Threat Protection Act of 2000 (Public Law 106-554) to locate and 
apprehend fugitives. RFTFs supplement the 85 district-managed, multi-
agency task forces already operating throughout the country. To date, 
six RFTFs are in operation and USMS is exploring areas of the country 
where RFTFs would have the greatest impact based on the warrant 
workload, but there are no immediate plans for additional RFTFs. The 
city in parenthesis indicates where the task force headquarters office 
is located:
  --Capital Area Region (Washington, DC)--in operation.
  --Great Lakes Region (Chicago, IL)--in operation.
  --Gulf Coast Region (Birmingham, AL)--in operation.
  --New York/New Jersey Region (New York, NY)--in operation.
  --Pacific Southwest Region (Los Angeles, CA)--in operation.
  --Southeast Region (Atlanta, GA)--in operation.
    Question. What types of fugitives do these task forces investigate?
    Answer. RFTFs target the ``worst of the worst'' fugitives who have 
a history of violence. They include murderers, gang members, drug 
traffickers, and violent sex offenders. The USMS approach in assisting 
state and local agencies with their fugitive warrants has been twofold. 
First, the USMS reviews all fugitive warrants to determine their 
ability to be executed. During the review process, many warrants are 
determined to be unserviceable because of the age of the warrant, 
witnesses have disappeared, police officers or agents have retired, 
evidence is missing, or the prosecuting attorney dismisses the warrant 
upon review. Second, the USMS prioritizes based on the severity of the 
charge. Once a warrant is pursued by an RFTF, all resources are brought 
to bear to locate and apprehend the fugitive.
                               adam walsh
    Question. The National Center for Missing and Exploited Children 
(NCMEC) estimates that there are approximately 600,000 sex offenders in 
the United States that are required to register. As many as 100,000 are 
not in compliance with their registry requirements.
    How does the passage of the Adam Walsh Act affect the USMS?
    Answer. The Adam Walsh Child Protection and Safety Act of 2006 
directs the Attorney General to use the resources of federal law 
enforcement, including the United States Marshals Service (USMS), to 
assist jurisdictions in locating and apprehending sex offenders who 
violate registration requirements. It further provides that sex 
offenders who violate registration requirements are deemed to be 
fugitives for purposes of the Marshals Service's fugitive investigation 
functions, and it provides federal penalties for sex offenders who 
violate registration requirements under circumstances supporting 
federal jurisdiction (such as interstate travel). See  142 of the Adam 
Walsh Act and 18 U.S.C. 2250. The reforms of the Sex Offender 
Registration and Notification Act--i.e., title I of the Adam Walsh 
Act--generally strengthen the minimum national standards for the sex 
offender registration and notification programs of the states and other 
covered jurisdictions, and the national database and website system 
which make sex offender information obtained under the individual 
jurisdictions' programs more widely available to law enforcement and 
the public. See generally 72 FR 30209 to 30234 (May 30, 2007) (proposed 
National Guidelines for Sex Offender Registration and Notification 
issued by the Attorney General). The Adam Walsh Act reforms increase 
the capacity of responsible officials at all levels of government to 
track sex offenders effectively following their release into the 
community through enhanced registration standards and requirements, and 
the USMS serves as the lead federal law enforcement agency in 
investigating violations of these requirements and helping to locate 
and apprehend non-compliant sex offenders.
    Question. How long would it take the Service to fully enforce this 
law, and what kind of resources would be required?
    Answer. It will take several years to fully enforce this law 
because the existing network of sex offender registries must first be 
improved and the Sex Offender Registration and Notification Act (SORNA) 
must be implemented by all jurisdictions. Most, but not all, states 
have some form of registry already in place, however, these registries 
are not well integrated with each other or with the National Sex 
Offender Registry. In the interim, the USMS has begun a two-part 
approach: enforcement and compliance.
    With regard to enforcement, the USMS has established the Sex 
Offender Investigations Unit at headquarters. A full-time liaison has 
been stationed at the National Center for Missing and Exploited 
Children (NCMEC). The USMS is working with NCMEC to develop and 
establish the ``National Sex Offender Targeting Center'' which will:
  --Identify and prioritize targets by using analytical tools;
  --Aid the USMS and other agencies with investigative leads;
  --Provide a valuable data source for state and local agencies;
  --Operate a national tip line and web site;
  --Provide analytical support to law enforcement;
  --Serve as a national point of contact for sex offender registration 
        issues; and
  --Provide a source to share other criminal leads.
    Designated Sex Offender Investigations Coordinators have been 
identified in all 94 USMS district offices and within the Regional 
Fugitive Task Forces. The first 50 coordinators have already been 
trained and an additional 150 personnel will be trained by the end of 
fiscal year 2007. The USMS is currently establishing contacts with 
state, local, tribal, and territorial sex offender registries. At the 
same time, the USMS is coordinating efforts with the Department of 
Homeland Security's ``Operation Predator'' to ensure that illegal alien 
sex offenders are referred to the Bureau of Immigration and Customs 
Enforcement for removal.
    With regard to compliance, the USMS is planning a media campaign to 
educate sex offenders about their registration requirements and the 
enhanced penalties for non-compliance, in an effort to encourage them 
to register or update their registrations.
    Question. How many additional positions are being created in the 
USMS to help you track down non-compliant sex offenders?
    Answer. The USMS has designated three positions from existing 
resources to establish the Sex Offender Investigations Unit at 
headquarters, which includes the full-time liaison at NCMEC. Until 
additional resources are provided, the USMS will rely on the six 
existing Regional Fugitive Task Forces and 85 district-managed task 
forces to aggressively pursue unregistered sex offenders and offenders 
against children. The USMS is committed to enforcing the Adam Walsh Act 
in addition to pursuing fugitives wanted for violent federal and state 
crimes.
    The fiscal year 2008 President's budget includes a request for 54 
positions (including 43 Deputy Marshals), 27 FTE, and $7,845,000 to 
begin deploying Deputy Marshals to areas of the country that have large 
numbers of non-compliant sex offenders.
                      marshals d.c. superior court
    Question. This Committee is concerned about the health, safety and 
security of the U.S. Marshal Service employees at the D.C. Superior 
Court. The cellblock and workspace there are below any acceptable 
standards and are in desperate need of renovation.
    Are you working with the D.C. Courts to fix the U.S. Marshals 
Service occupied space at the D.C. Superior Court?
    Answer. Yes, the Marshals Service is working with the D.C. Courts 
Executive Office on a memorandum of agreement (MOA) to delineate the 
responsibilities for repairing and maintaining the space provided to 
the USMS in the Moultrie Courthouse. The space provided to the USMS by 
the D.C. Courts belongs to the D.C. Government. The MOA between the 
USMS and the D.C. Courts will identify responsibilities much in the 
same way that tenant/landlord agreements are established.
    Question. Does the $10 million that the Senate provided in the 
fiscal year 2007 supplemental appropriations bill help begin to 
alleviate the Superior Court situation?
    Answer. The $10 million would provide a short-term remedial 
solution until the Executive Office of the D.C. Courts obligates the 
resources to make long-term renovation to improve the cellblock 
physical infrastructure and USMS office space. Health, safety, and 
security improvements in the cellblock and prisoner receiving areas 
would have a positive multi-agency impact as this environment is 
utilized by the USMS, Metropolitan Police Department, Department of 
Corrections, and numerous law enforcement officers who transfer 
prisoners to and from USMS custody.
    Question. Do you give this subcommittee your commitment to ensure 
that the USMS employees at Superior Court are taken care of?
    Answer. Yes, the Marshals Service will take the necessary steps to 
ensure the health, safety and security of USMS employees at Superior 
Court. The majority of administrative personnel, warrant squad, writ 
squad, and prisoner coordination section have been relocated to another 
building because adequate space was not available in the Moultrie 
Courthouse. Remaining USMS personnel who manage court support and 
cellblock operations continue to work out of the Moultrie Courthouse 
and the USMS continues to request additional space from the Executive 
Office of the D.C. Courts to ensure that USMS court operations has 
adequate and safe office space. Until additional space is obtained, the 
USMS will ensure that personal protective equipment and gear are 
supplied so that USMS personnel can operate safely.
    Question. Does this workspace meet any Federal standard for health, 
safety or security?
    Answer. The Marshals Service surveyed the Moultrie Courthouse and 
it does not meet GSA, OSHA (Occupational Safety and Health 
Administration), and USMS standards for security, safety and health. 
The USMS identified the following as problem areas: vehicle prisoner 
loading--sallyport, main detention area--cellblock, main detention 
area-fixtures and construction, detention area-processing room, main 
cellblock-interview rooms (prisoner) side, detention facilities, 
prisoner circulation from cellblock to court floors, courtroom holding 
facilities and circulation, support and special purpose space. The USMS 
is committed to working with the Executive Office of the D.C. Courts to 
ensure that all security, safety, or health issues are addressed in a 
manner that is mutually beneficial.
                           homeland build up
    Question. The Department of Homeland Security (DHS) is in the 
process of hiring up to 2,000 new border agents.
    How does this escalation in DHS personnel correspond to the 
Marshals' responsibilities to produce prisoners for trial and provide 
courtroom protection?
    Answer. As DHS increases the number of border patrol agents along 
the Southwest Border and in other areas of the country, arrests will 
increase which will in turn increase the number of detainees in USMS 
custody. The USMS average daily prisoner population continues to 
increase, particularly in the five districts that comprise the 
Southwest Border:

------------------------------------------------------------------------
                                               Fiscal year--
                                  --------------------------------------
                                       2004         2005         2006
------------------------------------------------------------------------
Ave Daily Prisoner Population--         49,400       53,000       56,000
 Total...........................
Ave Daily Prisoner Population--         16,600       17,500       18,700
 SWB Only........................
------------------------------------------------------------------------

    For example, the Del Rio suboffice in the Western District of Texas 
has an average daily prisoner population of over 2,600. In comparison, 
the District of Maryland has just over 450 per day. The three judicial 
districts in Alabama combine for just over 600 per day.
    Question. How does this hiring at DHS affect the USMS budget?
    Answer. As DHS increases its hiring, the impact on the USMS budget 
is felt approximately 18 months later. It takes about 18 months for DHS 
to recruit, train, and fill its new positions. Once on board, new 
border patrol agents begin making arrests which drives up USMS 
workload.
    Question. How will this affect court operations?
    Answer. The immediate impact to court operations is that the USMS 
must produce prisoners before magistrate judges for all criminal court 
proceedings. Even if these defendants do not reach trial, the USMS is 
required to produce them for all attorney interviews, medical trips, 
and court-related appearances. This is an enormous strain on USMS 
resources because Deputy Marshals must ensure the safety of all judges, 
attorneys, witnesses, and the public at all court hearings.
                                 gangs
    Question. The increase in gang-related trials around the nation 
creates security concerns, not only for members of the judiciary, but 
also for witnesses and trial observers. Recent examples include the MS-
13 trials in the D.C. area and the Aryan Brotherhood trials in 
California.
    How is the Marshals Service tracking violent gangs?
    Answer. The USMS uses the combined resources of its six Regional 
Fugitive Task Forces and 85 district-managed task forces to investigate 
and apprehend violent fugitives which include violent gang members. 
Investigative information gleaned from these fugitive cases is 
maintained in an automated fashion and is accessible by USMS judicial 
security inspectors who are responsible for the operational planning of 
high-threat trials. Many of these trials involve violent gangs, 
including prison gangs. This information is also used to separate 
detainees within the cellblock and on any JPATS air transportation 
movements to ensure the safety of Deputy Marshals and other prisoners.
    Question. What more could you do if you had additional resources?
    Answer. The 2008 President's budget includes a request for 17 
additional positions, including 15 Deputy U.S. Marshals, and $5.1 
million for high threat trial security. This request will provide surge 
capacity that can be deployed to high threat trials throughout the 
country. If fulfilled, USMS will have the flexibility to deploy 
additional personnel or security resources for trials related to gangs, 
terrorism, or any other purpose requiring additional security.
      former marshal's daughter heroic efforts in campus shooting
    Question. Director Clark, I understand that a former Marshal's 
daughter was wounded in the shootings on the Virginia Tech campus 
Monday morning. Her heroic efforts saved the lives of her classmates.
    Would you tell us about Jim Carney and his daughter Katie's story?
    Answer. On April 16, 2007, Katelyn Carney, the daughter of retired 
Deputy U.S. Marshal Jim Carney, was shot in the left hand and a second 
bullet grazed her head during the shooting rampage at Virginia Tech 
University. Ms. Carney and three other students blocked the doorway to 
their classroom to prevent the gunman from returning. Ms. Carney is 
expected to make a full recovery.

                          SUBCOMMITTEE RECESS

    Senator Mikulski. Yes. This subcommittee stands in recess 
until next Thursday, April 26, at which time we will take the 
Federal Bureau of Investigation. It will be followed the 
following week by the EEOC and then we will come back to the 
Justice Department.
    [Whereupon, at 11:29 a.m., Thursday, April 19, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]





















  COMMERCE, JUSTICE, SCIENCE, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2008

                              ----------                              


                        THURSDAY, APRIL 26, 2007

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:30 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Patrick J. Leahy presiding.
    Present: Senators Mikulski, Leahy, Kohl, Lautenberg, and 
Shelby.

                         DEPARTMENT OF JUSTICE

                    Federal Bureau of Investigation

STATEMENT OF HON. ROBERT S. MEULLER III, DIRECTOR

                 STATEMENT OF SENATOR PATRICK J. LEAHY

    Senator Leahy. Let me mention before we start that, I've 
often used the expression that Senators are merely 
constitutional impediments for their staffs. And, in the United 
States Senate, if it wasn't for the superb staff members of 
both Republican and Democratic Senators, we would not be able 
to exist in this subcommittee. I've served on most of my years 
in the Senate to various integrations.
    We've seen some wonderful people here, but Paul Carliner, 
who's sitting here to my left, this is his last hearing as 
clerk. He's spent 16 years in the Senate, but 8 years on this 
subcommittee. Paul is one of the reasons why the rest of us can 
do our work. He has shown the ability to reach out to Members 
on both sides of the aisle on very difficult things. Everybody 
on this subcommittee wants something, usually something 
different. And he's the one that's trying to do that. So, Paul, 
congratulations to you.
    Mr. Carliner. Thank you, Senator.
    Senator Leahy. And, Director Mueller, thank you for joining 
us today to testify before this subcommittee.
    I also want to thank the Chair of our subcommittee, Senator 
Mikulski, for allowing me to open the hearing on her behalf. 
She's going to be joining us shortly, but she's on her way back 
from the formal send off for the 1,300 Maryland National 
Guardsmen that are going to be deployed to Iraq in the next few 
months.
    Having attended too many of such events in my own State of 
Vermont, I know how hard the send off is for the guardsmen, 
their families, and friends, for Senator Mikulski, and all 
those attending. And our hearts and prayers are with those 
brave Maryland soldiers and all our brave men and women 
preparing to leave and our hearts and prayers are with their 
families. I hope they come back safely.
    Now, I know in the wake of the terrorist attacks, the 
Justice Department's focused much of its attention in the 
prevention of terrorism and the promotion of national security. 
I worry, however, that the budget proposal, if it's enacted, is 
going to divert critical resources and staffing from 
traditional law enforcement matters. We've seen a spike in 
violent crime, which is something I know concerns the Director 
very much. And, if we shift money into counterterrorism, we 
take it away from traditional criminal matters.
    The fiscal year 2008 budget requests a realignment of 100 
criminal agents, counterterrorism work. That would leave 
traditional criminal law enforcement significantly understaffed 
in the Bureau. If you realign these agents further it may 
further erode the Federal Bureau of Investigation's (FBI) 
ability to combat violent crime. It has been cited by the 
Office of Inspector General (OIG) as one of the top management 
challenges at the Justice Department.
    And, since the FBI announced the Virtual Case File 
successor, the Sentinel Program, I really have not been 
confident of the Bureau's ability to manage the status and cost 
of this project. The FBI estimates that Sentinel will 
ultimately cost the American taxpayers $425 million. A December 
2006 OIG audit questioned the reliability of the total 
estimated cost of the program. It was originally expected the 
full Sentinel system would be deployed in 2009. Recently, 
however, we hear a familiar piece of news regarding the FBI's 
computer upgrade project. Apparently there will be delays in 
the deployment of phase one of the Sentinel upgrade, which 
jeopardizes the schedule for this much-needed computer system.
    And, I worry--as one baseball great once said, it's deja vu 
all over again--we tried Trilogy, we scrapped that. We were 
told that Virtual Case File would meet the FBI's needs and 
that's been scrapped. Now that delays in Sentinel have been 
announced, is not clear at all the third time's going to be the 
charm. It's been an expensive series of lessons, costing nearly 
$423 million for these programs so far.
    Another recent report by the Office of Inspector General 
found the FBI can't account for 160 laptop computers, and an 
equal number of weapons that were lost or stolen over a 3\1/2\-
year period. And, this comes 4 years after a recommendation 
that they take steps to ensure the security of this equipment. 
And, even more troubling, in many cases, it was found the FBI 
could not even determine whether these lost or stolen computers 
contained classified or sensitive information, putting Bureau 
employees and other individuals at risk of becoming victims of 
identity theft.
    I am deeply troubled by, as I've discussed with the 
Director and I know of his concern in this, the OIG's report 
finding widespread illegal and improper use of national 
security letters. We had a hearing on this in the Judiciary 
Committee.
    So, we're at a crossroads. And, I think if we don't learn 
from the mistakes, progress won't be made.
    I'll put my full statement in the record. It's quite a bit 
longer.
    [The statement follows:]
             Prepared Statement of Senator Patrick J. Leahy
    Director Mueller, welcome and thank you for joining us today to 
testify before the Appropriations Subcommittee on Commerce, Justice and 
Science regarding the fiscal year 2008 budget request for the Federal 
Bureau of Investigation. You and I get to see each other from time-to-
time when you come before the Judiciary Committee for oversight 
hearings. Today, however, I am here wearing my appropriator's cap and I 
look forward to hearing you make the case for the budget the President 
has proposed for the FBI in the coming year.
    I also want to thank the chair of our subcommittee, Senator 
Mikulski, for allowing me to open this hearing on her behalf. She will 
be joining us shortly, but is on her way back from the formal send-off 
of the 1,300 Maryland National Guardsmen who will be deployed to Iraq 
in the next few months. Having attended several such events in my own 
home state of Vermont, I know how hard this sendoff must be for the 
Guardsmen, their families and friends, Senator Mikulski and all those 
attending. Our hearts and prayers are with those brave Maryland 
soldiers--and all of our brave men and women preparing to leave--and 
their families during this difficult time. We hope they will be 
returning home soon.
    During recent years, the FBI has confronted the daunting challenge 
of protecting our nation against international terrorism in the wake of 
the attacks of September 11, 2001, the subsequent anthrax attacks and 
other threats. Director Mueller, you deserve credit for your efforts to 
assure the safety of the American people.
    In the wake of terrorist attacks, I recognize that the Justice 
Department focused much of its attention on the prevention of terrorism 
and the promotion of national security. Its top priorities continue to 
be the prevention, investigation and prosecution of terrorist 
activities against U.S. citizens and interests, which is evident in the 
request for more than $417 million in new investments for the FBI, 
including counterintelligence activities and justice information 
systems technology.
    Nonetheless, I am concerned that this budget proposal, if enacted, 
would divert critical resources and staffing from traditional law 
enforcement matters, such as reducing the spike in violent crime, to 
support the Bureau's counterterrorism work. The fiscal year 2008 budget 
requests the realignment of one hundred criminal agents to 
counterterrorism work. This would leave traditional criminal law 
enforcement significantly understaffed at the Bureau. Realigning these 
agents may further erode the FBI's ability to combat violent crime and 
has been cited by the Office of Inspector General (OIG) as one of the 
top management challenges at the Justice Department. We must not allow 
daily responsibilities that keep our citizens safe to fall aside.
    It has been over two years since the FBI announced it would scrap 
the three-year $170 million effort to develop a modern case management 
system, known as the Virtual Case File, or VCF. I have repeatedly 
expressed to you, Director Mueller, my deep frustration over the 
millions of dollars wasted on ``lessons-learned,'' and the fact that 
more than three years have passed since the original deadline while 
these technology goals are not met.
    Since the FBI announced the VCF's successor, the Sentinel program, 
I have seen nothing to boost my confidence in the Bureau's ability to 
manage the status and cost of this project. While the FBI estimates 
that Sentinel will ultimately cost the American taxpayers $425 million, 
a December 2006 OIG audit report questioned the reliability of the 
total estimated costs for the program. It was originally expected that 
the full Sentinel system would be deployed in 2009. Just recently, 
however, we learned a familiar piece of news regarding the FBI's 
computer upgrade project. Apparently there will be delays in the 
deployment of Phase I of the Sentinel upgrade, which jeopardizes the 
schedule for this much-needed computer system.
    This latest setback is one of a string of costly delays in the 
FBI's efforts to upgrade its computers. Sentinel was launched after the 
FBI wasted five years and millions of taxpayer dollars on the failed 
Trilogy program. By my calculations, at least $253 million has been 
invested in Sentinel alone from fiscal year 2005 to fiscal year 2007 
between reprogramming dollars and Congressional appropriations. The 
President's fiscal year 2008 Budget proposes no funding for the 
project. The first of four program upgrade phases has yet to be 
completed, although we expected the entire Sentinel program to be up 
and running by 2009.
    Director Mueller, this committee has to ask: Is this deja vu all 
over again? You tried Trilogy and scrapped that. You told us that 
Virtual Case File would meet your needs and you scrapped that. Now that 
delays in Sentinel have been announced it's not clear at all that the 
third time will be the charm. This has been an expensive series of 
lessons--costing nearly $423 million for these three programs so far--
learned on the backs of American taxpayers.
    We must ensure that the FBI's technological capabilities keep pace, 
and to do so requires not only an emphasis on providing funds but also 
effective use and implementation. I hope the latter is not neglected 
and I remain seriously concerned about this project.
    The pattern of incompetence and lack of accountability within the 
Bureau is also on display with its treatment of its own equipment and 
weapons. Another recent report by the DOJ OIG found that the FBI cannot 
account for 160 laptop computers and an equal number of weapons that 
were lost or stolen over a 3\1/2\ year period. This finding comes 4 
years after the Inspector General recommended that the FBI take steps 
to ensure the security of this equipment. Even more troubling, in many 
cases it was found that the FBI could not even determine whether its 
lost or stolen computers contained classified or sensitive information, 
putting Bureau employees and other individuals at risk of becoming 
victims of identity theft and potentially compromising national 
security information
    I am deeply troubled by the DOJ OIG's report finding widespread 
illegal and improper use of National Security Letters (NSLs) to obtain 
Americans' phone and financial records. As Chairman of the Senate 
Judiciary Committee, I convened a hearing on NSL abuse several weeks 
ago. Inspector General Fine testified that his office found 22 separate 
instances where the FBI improperly abused NSLs in the review of just 77 
FBI files. Not a single one of these violations had been reported by 
the FBI. On top of that, because the FBI still lacks the information 
technology that it needs to function efficiently in the Information 
Age, OJG found that the FBI database used to track NSLs malfunctioned, 
making it impossible to keep track of these letters. I fear that the 
violations the Inspector General uncovered are probably just the tip of 
the iceberg and that there could be thousands of additional violations 
among the tens of thousands of NSLs that the FBI is now using each 
year.
    The FBI finds itself again at a crossroads. Acknowledging 
shortcomings is well and good, but the Bureau--and the Justice 
Department as a whole--must also learn from its mistakes if progress is 
to be made. The time has come for demonstrable progress by the Bureau 
on a learning curve that has gone on and on for far too long. Much work 
remains to be done and I have no doubt that the leaders and members of 
this Subcommittee will fulfill their obligation to the American people 
to carefully examine all of these issues.

                 STATEMENT OF SENATOR RICHARD C. SHELBY

    Senator Shelby. Thank you, Mr. Chairman. We appreciate you 
being here in place of Barbara Mikulski. We know Senator 
Mikulski, the Chair, is tied up, but she's very involved in 
these issues.
    Paul, I want to just say to you, we wish you well. As 
Senator Leahy said, you've served the Senate well, you've 
served this subcommittee very, very well and we wish you the 
very best in whatever your next step is. We'll miss you here. 
You have--on this side of the aisle--I know you work with the 
Democrats, but you have, when I was chairman of this 
subcommittee, you were a valuable resource to getting the job 
done here, for everybody, and we owe you a lot. And, we thank 
you for your service to the Senate and to the Nation.
    Mr. Carliner. Thank you, sir.
    Senator Shelby. Director Mueller, thank you for joining us 
today to discuss the Federal Bureau of Investigation's 2008 
budget request. One week after your arrival as the sixth 
Director of the FBI, our Nation suffered its worst terrorist 
attack ever on U.S. soil. The September 11, 2001 attack--
attacks on the World Trade Center and the Pentagon signified 
the transformation of a new FBI, focusing more on national 
security. Congress has tasked the FBI with more responsibility 
than any other Federal law enforcement agency, resulting in 
more challenges and changes than ever before.
    The FBI is the Nation's premier law enforcement 
counterterrorism and counterintelligence agency that 
investigates criminal activity and includes terrorism, foreign 
intelligence, operations, espionage, cyber-crime, public 
corruption, national criminal organizations, white-collar 
crimes, and significant violent crime. The FBI request for 2008 
is $6.4 billion. This is a $391 million increase over the 2007 
joint resolution funding level.
    It has come to my attention, Mr. Director, that the FBI has 
a $139 million shortfall in the 2008 budget request. Chairman 
Mikulski and I want to work with you to ensure that the FBI has 
sufficient resources to protect our Nation. Based on my review 
of your request, combined with the likely fiscal constraints of 
this subcommittee, we will need your assistance as we face 
tough funding decisions regarding the allocation of resources 
in your budget.
    This subcommittee and the Bureau share the difficult task 
of targeting these limited resources in a manner that 
safeguards taxpayers' dollars, while preserving public safety. 
The Department of Justice's inspector general (IG) recently 
issued a report critical of the FBI's use of national security 
letters (NSL). The IG's review found that more than 60 percent 
of the files examined, including--included violations of the 
FBI's own policies and procedures.
    The report also identified significant abuses in the use of 
exigent letters. The FBI regularly issued them when no 
emergency existed, often when there was not even a criminal 
case open. The lack of controls in the use of national security 
letters and exigent letters is very troubling, but as the 
former chairman of the Senate Select Committee on Intelligence, 
I also know that they're critical in your mission of keeping 
America safe.
    Director Mueller, in our meeting last month, you committed 
to fix the deficiencies identified in the IG report and to 
implement its 10 recommendations. The FBI must carefully 
balance the privacy protections and civil liberties of 
Americans against the need to provide its agents critical 
information that's pivotal to mission success.
    Chairman Mikulski and I have provided the FBI $10 million 
in the current war supplemental bill to carry out the IG's 
recommendations to fix these problems.
    We're extremely saddened, as you were, by the tragedy that 
took place on the Virginia Tech campus last week. I understand 
that the FBI dispatched 20 agents, four victim assistant 
specialists, and one terrorism victim specialist. I look 
forward to hearing from you, Mr. Director, about the FBI's 
role, and what these men and women are doing to assist those 
affected by this terrible event.
    While I wholeheartedly support bringing the FBI into the 
21st century and realize the importance of information 
technology in the FBI's mention--mission, I have a number of 
unanswered questions about Sentinel's phase one implementation. 
Given your Trilogy failure, I will not support unlimited and 
unchecked resources and will not tolerate broken promises for 
the results of information technology (IT) projects that are 
not fulfilled or delivered.
    I understand that things are on track and within budget, 
but I expect the questions of this subcommittee to be answered 
in a timely and complete manner. This has not occurred, but I'm 
hopeful that with your commitments here today, we'll be able to 
continue our support for this needed, important project.
    The FBI's Hazardous Device School, HDS, at Redstone 
Arsenal, is the crown jewel of the Federal Government's effort 
to provide training to Federal, State, and local bomb 
technicians. In partnership with the Army, this facility has 
trained over 20,000 bomb technicians in the past 36 years. 
That's a proven record of success.
    HDS is the only pre-blast explosive training school in the 
United States. With the continued construction of the National 
Center for Explosive Research, Redstone Arsenal will become the 
home of Federal law enforcement explosives training and 
research. I'm working collaboratively to expand the Federal 
Government's explosive infrastructure and expertise here. I 
look forward to hearing from you, Director Mueller, to ensure 
that Redstone Arsenal is, and will continue to be, the law 
enforcement capital of explosives research and training.
    There are other issues I'd like to discuss this morning, 
including the use of resources for the FBI's priority missions. 
In addition, I would like to talk about the relationship of the 
FBI Director to the new Director of National Intelligence and 
the financial and manpower implications for the FBI. I remain 
concerned that this new arrangement, while important, is 
placing additional personnel stresses on an overburdened FBI. I 
fear that some of the FBI's traditional law enforcement 
responsibilities will not be sufficiently supported by this 
budget request.
    Director Mueller, I look forward to hearing your thoughts 
on the FBI's budget request and we also look forward to working 
with you on these and other important issues facing our Nation.
    And, Madam Chairman, I just want to thank the men and women 
who work at the Federal Bureau of Investigation for what they 
do to keep this country secure.
    Thank you.
    Senator Mikulski [presiding]. Thank you very much, Senator 
Shelby, and good morning to everybody. I'm going to say just a 
few quick thanks before we go right into our hearing.
    First, thank you, Senator Leahy, for opening this hearing 
and advising everyone that I was with our Governor, Governor 
O'Malley, to see off the first phase of National Guard 
deployment from the State of Maryland, 1,400 Marylanders have 
been called up, and will all be leaving in 90 days. So, we 
wanted to be there for them this morning.
    So, Senator Leahy, thank you for that.
    And, Director Mueller, thank you for accommodating the 
delay of starting this hearing.
    I want to advise my colleagues that the Director must leave 
at noon. So we're going to go right into allowing you to 
testify, so I ask that during the questions, if you have things 
you want to incorporate from your opening statement, do.
    I also want to thank Senator Leahy for acknowledging that 
today is the last hearing--the last public appearance of Paul 
Carliner--Ace Aide who's served me for 12 years. He has served 
the Nation for 12 years in his role as my clerk on 
Appropriations. We wish Paul well. We know wherever he goes, he 
will be outstanding. But also, it's a goodbye for the FBI's 
legislative Ace Aide as well, Eleni Kalisch.
    Eleni, please stand up so people can know who you are.
    Ms. Kalisch is going to be leaving the FBI. She has been 
the Director's liaison to this subcommittee and has done an 
outstanding job. We always appreciated your candor and your 
cooperation, as you appreciated Paul's candor, we'll call it 
candor these days because we're being kind. But really, we wish 
you very well, Ms. Kalisch, in your new life. Because I think 
all of us know, we can't do our job without the worker bees and 
we thank our staff and again, reiterate how much we appreciate 
the FBI itself.
    Senator Shelby outlined the budget concerns. I'm going to, 
essentially, agree with the issues that he's raised, and ask 
unanimous consent that my full statement be in the record.
    And, note the fact that we've asked the FBI to essentially 
be two agencies, but the same agency. One agency to fight the 
global war against terrorism, to have an agency within the 
agency, our own, kind of American, uniquely American version of 
MI5, to really work in protecting our homeland, and at the same 
time to continue fighting violent crime, protecting children 
against exploitation, whether it's on the Internet or in the 
playgrounds, from despicable, heinous sexual predators. We are 
working to give them the resources to do both, which requires 
new people, requires new training, and requires us to stand 
sentry against those things that sometimes get out of our 
control.
    So, in the course of this hearing, we're going to come back 
to know if you have the real resources to fight this new 
emerging spike in organized crime. How is it working to take on 
what we're asking you to deal with, the exploitation of 
children? Cyber-crime is despicable, whether it's a hacker 
against our national lab or whether it's a cyber-stalker 
against our kids. And, at the same time, the FBI is fighting 
the global war against terrorism.
    I was recently in London and had the chance to meet with 
MI5, but while I was meeting with MI5 I was also meeting with 
the FBI office there. And I saw how the FBI and our intel 
agencies worked with a very treasured ally in disrupting that 
very ghoulish airline plot of last summer.
    So, you've got a big job, we know that your budget has 
increased, but we want to make sure we're matching resources 
with mission and also standing sentry on our accountability 
issues. So, having said that, the statement I wanted to make on 
the details of the budget, I'll put into the record.
    Why don't you go ahead and present your testimony, Director 
Mueller, and then we'll get right into the questions, which I 
think is the meat and potatoes of the hearing.
    [The statement follows:]

           Prepared Statement of Senator Barbara A. Mikulski

    This is the second in our series of hearings focusing on 
security. Unfortunately, this comes in the aftermath of two 
tragedies--the tragic events at Virginia Tech last week and the 
death of FBI Special Agent Barry Lee Bush, a 20-year veteran of 
the FBI, who was killed in the line of duty in New Jersey three 
weeks ago. In both cases, we were reminded that violent crime 
is a growing problem in this country and the FBI's own 
statistics show it is on the rise.
    The number one job of government is to keep our communities 
safe from violence. But the rise in violent crime and the 
critical ongoing fight against terrorism have placed new 
pressure on the FBI. Just look at the FBI's top priorities: 
combating terrorism, preventing the acquisition of weapons of 
mass destruction, stopping violent crime on our streets, 
stopping foreign intelligence operations, stopping the 
exploitation of children, and fixing their information 
technology infrastructure.
    The FBI is both an intelligence and a law enforcement 
agency. It is no longer just a domestic law enforcement agency. 
It is now a global intelligence and law enforcement agency 
operating in over 50 foreign countries. Unfortunately, compared 
to other intelligence agencies, the FBI share of the overall 
intelligence budget is small.
    Yet, the FBI is charged with protecting 300 million 
Americans from a terrorist attack. In January, the President 
increased the FBI's role in counterterrorism by transferring 
the Render Safe mission from the Defense Department to the FBI. 
This means the FBI is now responsible for dismantling a nuclear 
device in the United States.
    This has increased the FBI's responsibility and placed 
added pressure on its budget. I am very concerned about the 
rising rate of violent crime. Just look at the most recent 
statistics from the FBI: robbery is up by 9.7 percent, 
aggravated assault is up by 1.2 percent, murder has increased 
by 1.4 percent and for cities with populations of 500,000 to 1 
million--the murder rate has increased by 8.4 percent.
    However, since 9/11, the FBI has shifted almost 2,000 
agents from violent crime into counterterrorism. This forced 
state and local law enforcement to take up the slack, because 
of rising crime rates, state and local law enforcement are 
stretched to the limit.
    I believe we need more resources dedicated to violent 
crime. State and local law enforcement needs the FBI to help 
them fight street gangs like MS-13 and other types of organized 
crime plaguing our communities. Joint federal-state task forces 
are the most effective means to combat violent gangs, drug 
dealers and others who have a predatory intent. We should 
expand federal-state task forces to help locals fight crime on 
the streets.
    Unfortunately, the President's budget cuts $1.5 billion 
from state and local law enforcement. You cannot cut the COPS 
program when violent crime is on the rise. Our communities need 
federal resources to keep them safe.
    In addition, I am concerned about the recent disclosure of 
abuses in issuing National Security letters. The Justice 
Department Inspector General [IG] found the FBI had no tracking 
or compliance procedures. This is unacceptable.
    That's why we added $500,000 to the IG's budget in the 
Supplemental Appropriations bill to continue oversight of the 
FBI on this subject. In addition, we directed that $10 million 
of the FBI's budget be dedicated to implementing the IG 
recommendations to make sure the FBI fixes the problem.
    The FBI must not only protect us from terrorists, they have 
to protect our privacy and our civil rights. I commend Director 
Mueller for his swift response to this problem and I look 
forward to hearing his long-term plan to correct these abuses.
    This subcommittee will also maintain it's vigilance on 
Sentinel, the FBI's long-delayed IT program. After the collapse 
of Trilogy, the FBI must stay on track, and see that this 
program does not fail.
    At the Congress' request, both the GAO and the Justice 
Department IG are monitoring and overseeing this program. We 
will maintain our vigilant oversight to ensure that this 
program stays on track and that no taxpayer dollars are wasted.
    The President's proposed budget for the FBI for 2008 is 
$6.4 billion, a 5 percent increase over fiscal year 2007. The 
proposed budget for fiscal year 2008 provides funding for 
11,868 special agents and 17,500 professional support 
personnel.
    I want to point out to my colleagues that since 2001, the 
FBI's budget has increased by over 100 percent. Few other 
agencies have had a 100 percent increase to their budget in 
just six years. But given the critical mission of the FBI, even 
a 100 percent increase may not be enough to fulfill its mission 
of protecting the American public.
    In counterterrorism, the budget proposes $2.5 billion, a 
$160 million increase over last year. This increase will pay 
for 176 additional special agents and 111 additional 
intelligence analysts in the counterterrorism division. 
Counterterrorism now accounts for 40 percent of the FBI's 
budget.
    In the area of violent crime, the fiscal year 2008 budget 
proposes to spend $2.1 billion, which is a $50 million increase 
over 2007. This is just a 2.5 percent increase over 2007.
    I have two concerns with this budget. First, the FBI's most 
recent statistics show a rise in violent crime across the 
country. When you add the $1.5 billion cut to state and local 
law enforcement in the President's budget, it becomes a double 
cut. Second, a 2.5 percent increase is not enough, given the 
needs of our communities all across this country. State and 
local law enforcement want to expand their cooperation with the 
FBI.
    The budget proposes to spend $22 million to fight crimes 
against children, a 5 percent increase over last year. We must 
do more to fight sexual predators. Our neighborhoods and 
communities need to be protected from these horrible predators. 
Since many of these predators use the internet and come from 
other states, only the FBI can mount a national fight against 
these predators, in cooperation with state and local law 
enforcement.
    Given all of these important roles and responsibilities, we 
must ensure that the FBI has the resources it needs. The lives 
of 300 million Americans depend on it.

    Mr. Mueller. Thank you and good morning, Madam Chair, 
Chairman.
    And, let me also start off by thanking Paul Carliner for 
his service. Looking at it, not from either side of the aisle, 
but from this side of the bench, let me tell you that our 
relationship has been terrific. You have been tremendously 
helpful and understanding the needs of the FBI and translating 
them into pieces of legislation to give us the funds that we 
need to do our mission. And, I also want to join the others in 
thanking you for the service and tell you that there are also, 
always employment opportunities at the FBI.
    And, let me also mention with Eleni Kalisch here, who has 
been, I must say, my strong right arm in what is an 
exceptionally important position in the FBI and that is a 
liaison with Congress. She has done a remarkable job. I hate to 
see her go, but I wish her good sailing and we will miss her. 
So, thank you, also for your service.
    I appreciate the opportunity, Madam Chairman, to be here 
today to discuss our 2008 budget request. I'd also like to 
thank this subcommittee for its continued oversight and support 
of the Bureau, as we work together to keep the Nation safe, 
while preserving the privacy rights and civil liberties of all 
Americans.
    As I said, the subcommittee is aware, and has pointed out, 
the FBI has been undergoing significant restructuring, 
realignment, and transformation for the past 5\1/2\ years. All 
designed to better position the Bureau to meet the threats and 
challenges of the future. And, the men and women of the FBI 
have demonstrated the ability and the willingness to embrace 
change for a better, stronger, and more effective organization. 
In order to continue to meet the evolving challenges facing the 
Nation, our 2008 budget request totals almost 30,000 positions 
and $6.4 billion.
    I would like to briefly address the five key challenges 
that are the focus of this budget request. First is combating 
terrorism; second, preventing the acquisition of weapons of 
mass destruction; third, defeating foreign intelligence 
operations; fourth, reducing child exploitation and violent 
crimes; and five, strengthening infrastructure and information 
technology.

                          COMBATING TERRORISM

    The first challenge continues to be addressing the current 
terrorist threat environment. It is clear that the FBI's 
operational and analytical commitment to combating terrorism 
must continue to grow. And, therefore, our budget requests 231 
new positions, 126 of which are agents. These resources will 
enable the Bureau to conduct investigations to prevent, 
disrupt, and deter acts of terrorism.
    Our intelligence-driven focus in addressing terrorism, at 
this point, is taxing our physical surveillance and electronic 
surveillance intelligence-gathering capabilities. Therefore, we 
are seeking enhancement of 118 new positions, including 12 
agents, $65 million, to strengthen surveillance and technical 
collection capabilities.
    The capacity to carry out extended covert surveillance of 
subjects and targets is essential to the FBI's counterterrorism 
and counterintelligence programs. Additionally, we must be able 
to develop and deploy new operational technologies and 
techniques to counter a more technically sophisticated 
adversary and to exploit and share the information that we 
gather.

                      WEAPONS OF MASS DESTRUCTION

    The second challenge that we are facing, addressed in the 
2008 budget, is the intent of terrorists to seek the means and 
capability to use weapons of mass destruction against the 
United States.
    In July of last year, we established the Weapons of Mass 
Destruction (WMD) Directorate to better integrate and leverage 
FBI counterproliferation and WMD intelligence analysis and 
prevention programs. We must continue to build this Directorate 
and we have requested 146 new positions toward that end, as 
well as $19 million to continue to enhance our capabilities to 
prevent, prepare for, and respond to the threat of WMD.

                    FOREIGN INTELLIGENCE OPERATIONS

    The third significant challenge addressed in our 2008 
budget is, or budget request, is the foreign intelligence 
threat to the United States. Foreign powers continue their 
efforts to establish economic, military, and political 
preeminence and to position themselves to compete with the 
United States in economic and diplomatic arenas. Foreign 
adversaries are increasingly employing nontraditional 
collectors, such as students, visiting scientists, scholars, 
businessmen, as well as cyber-based tools, to target and 
penetrate U.S. institutions.
    Our budget request includes a request for 119 positions, 55 
of which are agents, and $26.5 million to address these 
activities.

                           CHILD PORNOGRAPHY

    The fourth program area included in our 2008 budget request 
is combating child pornography and obscenity, and protecting 
children from trafficking and other forms of exploitation. One 
of the most important and successful programs is the innocent 
images national initiative, which for 10 years, has targeted 
sexual predators who use the Internet to exploit children.
    We have ongoing undercover operations across the country 
with more than 240 agents who investigate cases with their 
State and local counterparts. Unfortunately, there is no 
shortage of work in this arena. Our caseload has spiked from 
just 113 cases in 1996 to more than 2,100 last year. Our budget 
request proposes 14 new positions and $2.4 million for the 
Crimes Against Children and Innocent Images Programs.
    As this subcommittee is aware and has been pointing out in 
the opening statements, the country is experiencing an uptick 
in violent crime, particularly as it relates to gang violence. 
By our own estimates, there are now over 30,000 gangs across 
America and over 800,000 gang members. The FBI has established 
131 violent gang task forces across the country, enabling FBI 
agents to work in lockstep with police on the street, sharing 
information, and conducting investigations together.
    While combating violent crime remains a priority, the shift 
in resources from our criminal programs to our national 
security programs has been significant. And, in this current 
budget process, I'm looking forward to working with the 
subcommittee to ensure that our criminal programs may be 
restored to appropriate resource levels.
    I might add that, in this context, the budget process 
started 2 years ago. And consequently, when we sat down and 
addressed our priorities 2 years ago, we did not have the 
benefit of information that may have come along afterward, such 
as the recent statistics that indicate the uptick in violent 
crime. And so, as we go through this process, we want to work 
with the subcommittee to take into account those factors that 
may have come about over the last couple of years since we 
started this budget process.
    I might also add in this context, that in addition to our 
investigative capabilities, the Bureau brings to local, State, 
and national efforts, efforts against violent crime, a number 
of proven crime fighting technologies, services, and tools that 
are used every day by law enforcement agencies throughout the 
country. Whether it be forensics, identification and 
information technologies, all are crucial for leveraging the 
capabilities of our State and local law enforcement partners in 
the fight against violent crime. This also, should be taken 
into context as we go through this budget process this year.

               INFRASTRUCTURE AND INFORMATION TECHNOLOGY

    Finally, the overall success of the FBI's mission requires 
the appropriate work environment and updated information 
technology. The 2008 budget includes $15 million to provide 
technology support, and to prevent information technology 
obsolescence. This funding will enable us to upgrade networks 
and encryption to comply with mandated intelligence community 
protocols and to begin bringing desktops, laptops, servers, 
printers, into a 3-year technology refreshment cycle.
    Our request also includes a total of $11.5 million to 
address critical space requirements, including requirements 
associated with the FBI headquarters annex and $4 million for 
the central records complex. The annex will provide additional 
space to ease existing fragmentation of headquarters, divisions 
and offices. The central records complex will consolidate most 
of our records into a single facility, moving from a system of 
paper records to digital records.
    This covers, Madam Chairman, the five key areas, including 
violent crime, that are addressed in our 2008 budget request.
    But before concluding my remarks, I would like to provide 
an update on the development of our information management 
system, known as Sentinel. As has been pointed out by Senator 
Leahy, Sentinel is being developed in four phases, and will be 
delivered in increments beginning this year. We have attempted 
to keep your staffs briefed, every 2 weeks, at this juncture, 
on the status of that project. Our contractor, Lockheed Martin, 
has completed the critical design and build of the software 
application and is presently in the testing phase. Once this 
testing is complete, we will begin piloting phase one at 
headquarters, followed by piloting in several field offices, 
during which time ourselves and Lockheed Martin will correct 
any additional issues that surface. And, shortly after we 
complete the testing in pilot offices, we will begin the 
rollout of Sentinel training and the software application 
across the organization.
    We had hoped to begin deployment this month. Currently, we 
anticipate beginning deployment next month. I will tell you 
that the schedule has shifted, as a result of some unforeseen 
technicalities, a total of 5 weeks. I will also tell you that 
we are on budget. We will continue to keep the subcommittee 
updated on our progress in the weeks ahead.
    Madam Chairman, Senator Shelby, members of the 
subcommittee, I thank you for the cooperation and the support 
you have given to the FBI in the past and I ask for your 
support in providing the resources requested, not only in the 
2008 budget, but also resources that may be necessitated by a 
change of circumstances over the last several months or years. 
Again, I appreciate the opportunity to testify this morning and 
look forward to answering your questions.
    Thank you, Madam Chairman.
    [The statement follows:]

              Prepared Statement of Robert S. Mueller III

    Good morning, Madam Chairman, Senator Shelby, and members of the 
subcommittee. I appreciate the opportunity to appear before you today 
to discuss the President's Fiscal Year 2008 Budget for the Federal 
Bureau of Investigation (FBI). I would also like to thank you for your 
continued oversight of the Bureau and your efforts to ensure our 
success as we pursue the shared goal of making America safer.
                          2008 budget request
    The fiscal year 2008 budget for the FBI totals 29,373 positions and 
$6.4 billion. The net fiscal year 2008 program increases total 714 new 
positions (231 agents, 121 intelligence analysts, and 362 professional 
support) and $313.8 million. Our fiscal year 2008 budget is focused on 
improving the FBI's capabilities in addressing five key challenges: 
combating terrorism; preventing the acquisition of weapons of mass 
destruction; defeating foreign intelligence operations; reducing child 
exploitation and violent crimes; and strengthening infrastructure and 
information technology.
    I recognize that there are many competing requirements for limited 
funding. Nonetheless, the FBI must continue the progress it has made to 
implement the President's directives and the recommendations of the 9/
11 Commission and the Weapons of Mass Destruction Commission. At the 
same time, the FBI must be resourced to discharge its critical criminal 
investigative mission that also contributes to the overall safety and 
security of the Nation. In addition, for the FBI to be a full partner 
in the intelligence community it must have the tools, capacities, and 
capabilities to work closely with other members of the community. 
Finally, the FBI must find the proper balance between expanding our 
workforce and supporting on-board employees with the technology and 
infrastructure necessary to accomplish our mission. I believe the 
fiscal year 2008 budget will go a long way toward achieving these 
goals.
                          combating terrorism
    The current terrorist threat environment shows no signs of abating 
in the near term. Consequently, the FBI's operational and analytical 
commitment to combating terrorism is not expected to decrease. The FBI 
must remain vigilant for indications of terrorist groups shifting focus 
from the insurgency in Iraq and Afghanistan to acts that could be 
carried out against United States interests outside the current theater 
of operation and/or against the United States homeland. The FBI must 
also continue its efforts to deny terrorist groups and sympathizers the 
ability to raise funds and to carry out other operational and 
logistical support from the United States.
    This budget requests 231 new positions (126 agents) and $44.4 
million to conduct intelligence-drive terrorism investigations and 
operations. Additionally, the fiscal year 2008 budget proposes the 
reallocation of 100 field special agents from criminal investigations 
to counterterrorism. These resources will enable the FBI to conduct 
investigations to prevent, disrupt, and deter acts of terrorism and 
continue to strengthen working relationships with our Federal, State, 
and local partners; enhance our capacity for analyzing and exploiting 
information from growing volumes of seized terrorist digital media and 
communications; enhance the Terrorist Screening Center operations 
center; provide support to the National Virtual Translation Center, 
which serves as a clearinghouse to facilitate timely and accurate 
translation of foreign intelligence for elements of the intelligence 
community; and address growth in the number of terrorism and 
counterintelligence-related computer intrusion cases.
    Shifting from a reactive criminal prosecution approach to a more 
prevention and intelligence-driven focus in our counterterrorism 
program is taxing the FBI's physical surveillance and electronic 
surveillance intelligence gathering capacities. The capacity to carry 
out extended covert surveillance of subjects and targets is absolutely 
critical to the FBI's counterterrorism and counterintelligence 
programs. Surveillance capacities--physical and electronic--give us 
insight and awareness of our adversaries. Insight and awareness, in 
turn, create opportunities to identify sleeper cells, disrupt support 
networks and communications, and recruit assets. We need a robust 
surveillance capacity to keep on top of known and emerging targets. 
Additionally, we must be able to develop and deploy new operational 
technologies and techniques to counter a more technically sophisticated 
adversary and to exploit and share the information we gather.
    In fiscal year 2008, we seek an enhancement of 118 new positions 
(12 agents) and $65 million to strengthen surveillance and technical 
collection capacities. These resources will enable the FBI to increase 
the number of physical surveillance teams; address growing workload for 
electronic surveillance involving broadband and other data network and 
internet communications; develop new techniques and tools to address 
emerging technologies; meet demands for new audio and data collection 
and upgrade existing and/or obsolete digital collection system 
equipment and components; address growing workload for covert entries 
and searches; and develop new techniques and tools for tactical 
operations.
    An integral part of our national security program is the 
development and operation of human intelligence. Our budget request 
includes 85 new positions (6 agents) and $22.3 million to strengthen 
human intelligence capacities. This funding will enable the FBI to 
provide staffing for field intelligence groups to comply with new human 
source validation standards and perform continuous assessments; 
continue development and deployment of Delta to support management of 
over 15,000 FBI human sources; deliver and deploy comprehensive human 
source targeting and development training; and remediate human source 
handling deficiencies. The intelligence derived from FBI human 
intelligence source collection also enables other agencies' success in 
their counterterrorism, counterintelligence, and counterproliferation 
missions.
    We are fortunate that there has not been another major terrorist 
attack within the United States since September 11, 2001. This reflects 
positively, in part, on the hard and diligent work of FBI employees and 
those individuals who work alongside them, such as prosecutors and our 
partners in law enforcement and intelligence. However, we cannot afford 
to lessen our guard against the threat from terrorism. We must continue 
to invest in the resources and capabilities to counter an ever adapting 
and agile adversary.
preventing the acquisition of weapons of mass destruction (wmd)/render 
                                  safe
    The National Counterterrorism Center WMD Threat Assessment, 2005-
2011, reaffirmed the intent of terrorist adversaries to seek the means 
and capability to use WMD against the United States at home and abroad. 
Denying these adversaries access to WMD is a top administration 
counterterrorism strategy priority. Within the U.S. Government, the FBI 
has been assigned responsibility for Render Safe operations involving 
all WMD in the National Capital Region. The responsibility to render 
safe WMD throughout the remainder of the United States belongs to the 
FBI, supported by the Department of Defense. To fulfill its critical 
responsibilities in the area of WMD, the FBI must continue to build to 
the capacities and capabilities of its WMD Directorate and the Render 
Safe Program.
    The WMD Directorate was created in July 2006 to better integrate 
and leverage FBI counterproliferation and WMD intelligence analysis and 
prevention programs. The fiscal year 2008 budget seeks 146 new 
positions (29 agents) and $19 million to continue to enhance the 
Directorate's capabilities to prevent, prepare for, and respond to the 
threat of WMD. These resources will allow the FBI to enhance strategic 
partnerships with foreign intelligence, law enforcement, security, 
public health, agricultural, chemical, and other public and private 
sector agencies and organizations that are vital to the early detection 
of a potential WMD incident.
    The fiscal year 2008 budget also includes enhancements of 9 
positions (3 agents) and $11 million to enhance the FBI's Render Safe 
Mission, which encompasses both the tactical and technical response to 
incidents involving WMD within the United States and its territories. 
The complete development of a robust render safe crisis response for 
the directed contingencies requires the FBI to develop command and 
control capabilities to support deployments and to provide the FBI and 
United States Government leaders with the information required to make 
time-critical decisions. The requested funding will allow the FBI to 
enhance its National Asset response staffing beyond current minimum 
levels and provide program personnel with adequate training, equipment, 
supplies, and services. Additionally, the requested funding will allow 
the FBI to upgrade its Render Safe technical tools so the operators 
will have the latest and most effective technology at their disposal to 
meet and dispose of this challenge.
               defeating foreign intelligence operations
    The foreign intelligence threat to the United States is increasing 
as foreign powers continue their efforts to establish economic, 
military, and political preeminence and to position themselves to 
compete with the United States in economic and diplomatic arenas. 
Foreign adversaries are increasingly employing nontraditional 
collectors--e.g., students and visiting scientists, scholars, and 
businessmen--as well as cyber-based tools to target and penetrate U.S. 
institutions. The fiscal year 2008 budget includes 119 positions (55 
agents) and $26.5 million to address these activities.
    In November 2005, the FBI launched a Domain Management Initiative 
to focus attention on whether the FBI is conducting the right 
investigations to have the greatest impact on threats to national 
security. Continued implementation of the domain initiative will 
provide FBI leaders with a comprehensive and context decision-making 
environment. It will allow field office executive management to examine 
its target and regional environment and discuss the relative priority 
and focus of different activities. In addition, resources are needed to 
transform and leverage the capacities and capabilities of the Foreign 
Terrorist Tracking Task Force (FTTTF) into a National Security Analysis 
Center that would provide expanded analytical support to all FBI 
National Security programs by leveraging data and services residing in 
both FTTTF and the Investigative Data Warehouse.
              reduce child exploitation and violent crimes
    The FBI remains committed to fighting child pornography and 
obscenity, and to protecting children from trafficking and other forms 
of exploitation.
    The fiscal year 2008 budget proposes 14 new positions and $2.4 
million for the Crimes Against Children (CAC) and Innocent Images 
National Initiative (IINI) programs. These resources will enhance 
field-based Child Abduction Rapid Deployment (CARD) Teams that provide 
onsite response and investigative and technical assistance in child 
abduction cases. The funding will also enable the IINI, which targets 
child prostitution, to enhance its capacity to disseminate intelligence 
regarding unregistered sex offenders and innocent images 
investigations.
    In addition to its investigative capabilities, the FBI brings to 
local, State, and national efforts against violent crime a number of 
proven crime-fighting technologies, services, and tools that are used 
every day by law enforcement agencies throughout the country to solve 
crimes and put criminals in jail. FBI forensic, identification, and 
information technologies and tools are critical for leveraging the 
capabilities of our State and local law enforcement partners in the 
fight against violent crime. Access to these crime-solving services and 
capabilities is even more important in a post 9/11 environment where 
the FBI may not always be able to devote the level of special agent 
resources to violent crime as it has in the past. Over the past several 
years, State and local agencies have been provided grant funding to 
improve their digital forensic, DNA, automated fingerprint 
identification, and information sharing capabilities.
    One of the consequences of these improved State and local 
capabilities is increased demand for services and access to the 
underlying and unifying FBI systems and connectivity. For fiscal year 
2008, the FBI is requesting a total of $90.5 million to improve its 
capacities and capabilities for providing forensic, identification, and 
information technologies and services for law enforcement, including 
IDENT/IAFIS Interoperability ($10.0 million); Next Generation 
Identification ($25 million); Law Enforcement Information Sharing/R-DEX 
($5 million); DNA forensic services, including Walsh Act implementation 
($14.6 million); Combined DNA Index System ($7 million); Regional 
Computer Forensic Laboratories ($6 million); and Computer Analysis 
Response Teams ($22.8 million).
        strengthening infrastructure and information technology
    Critical to the success of the FBI mission are a safe and 
appropriate work environment and information technology (IT). Over the 
past several years, the FBI has made substantial investments to upgrade 
its underlying IT architecture, including the purchase of computer 
workstations and software for employees and networks for connectivity 
both within the FBI and with our external partners. Having made these 
investments to bring IT in the FBI to near current state-of-the-art, it 
is now necessary to keep these investments current with technology.
    The fiscal year 2008 budget includes $15 million to provide 
enterprise IT support and prevent IT obsolescence. This funding will 
enable the FBI to address increased costs of software license/
maintenance agreements, upgrade networks and encryption to comply with 
mandated intelligence community protocol, and begin bringing desktops, 
laptops, servers, and printers into a 3-year technology refreshment 
cycle.
    Additionally, $7.5 million is requested to continue to build and 
strengthen the FBI's IT program management capabilities. The Inspector 
General and others have repeatedly criticized the FBI for ineffective 
program management of IT projects. Funding requested will enable the 
FBI to increase management and oversight of critical IT projects, 
ensure compliance with FBI Life Cycle Management Directives, and 
enhance FBI IT policy and planning capacities.
    The FBI requests a total of $11.5 million to address critical space 
requirements, including $7.5 million for fiscal year 2008 requirements 
associated with the FBI Headquarters (HQ) Annex and $4 million for the 
Central Records Complex (CRC). The FBIHQ Annex will provide additional 
office space to ease existing fragmentation of headquarters divisions 
and offices. This funding will support the build-out of annex space, 
including furnishings, UNet and FBINet connectivity, equipment, locks, 
alarms, and access control. The CRC will consolidate most of the FBI's 
records, which are currently dispersed in FBI locations across the 
Nation, into one single facility. The funding requested will support 
non-standard requirements associated with the construction of the 
permanent CRC facility, such as fencing, vehicle barriers, and guard 
booths. Construction of the CRC, a GSA build-to-suit/leased facility, 
is planned to begin in fiscal year 2008.
                       ``unfunded fte'' reduction
    The fiscal year 2008 budget reflects a reduction of 2,700 positions 
(576 special agent and 2,124 professional support) for the FBI. This 
reduction is part of a Department of Justice-wide effort to remove 
``unaffordable work-years'' and to recast positions and work-years 
consistent with available funding. Let me assure you that the 
``unaffordable work-years'' reduction is being targeted against vacant 
positions and that no on-board FBI employee's position will be affected 
by this action. The underlying causes for the accumulation of 
``unaffordable work-years'' are the results of both internal workforce 
management decisions by the FBI and external decisions on the Bureau's 
budget.
                               conclusion
    Madam Chairman, Senator Shelby, and members of the subcommittee, 
today's FBI is part of a vast national and international campaign 
dedicated to defeating terrorism. Working hand-in-hand with our 
partners in law enforcement, intelligence, the military, and diplomatic 
circles, the FBI's primary responsibility is to neutralize terrorist 
cells and operatives here in the United States and help dismantle 
terrorist networks worldwide. Although protecting the United States 
from terrorist attacks is our first priority, we remain committed to 
the defense of America against foreign intelligence threats as well as 
enforcing Federal criminal laws while still respecting and defending 
the Constitution.
    I recognize that the fiscal year 2008 request will require 
difficult decisions with respect to meeting the competing demands among 
the Department of Justice components as well as those of other 
agencies. At the same time, even in times of fiscal restraint, there is 
a strong public expectation that the government provides our Nation's 
safety and security. Protecting the Nation from terrorist attacks, the 
threat of WMD, foreign intelligence agents, and violence requires a 
strong and well-resourced FBI.
    I ask for your support in providing the resources requested in the 
fiscal year 2008 budget so that we can fulfill our mission to safeguard 
the American people. I look forward to working with you on this budget 
proposal and other issues.
    Once again, I thank you for your continued support of the FBI. I am 
happy to answer any questions you may have.

    Senator Mikulski. Thank you very much, Mr. Director, and 
we're going to follow very closely our time. I'm going to get 
right to my questions. I'm going to go into three areas. The 
FBI fighting crime, the FBI fighting terrorism, and then making 
sure that the FBI has an accountability system for, not only 
Sentinel, but also the national security letters, where there 
seems to have been a big problem.

                             VIOLENT CRIME

    I'd like to go right to the violent crime issue because, 
again, we'll come back to the fact that you're two agencies, 
but you're one agency. Violent crime is on the rise, we've 
heard about the data. Robbery is up 9 percent, aggravated 
assault is up. It's not just about the crime, it's also who's 
doing the crime, the new gangs, and the threat of meth.
    As I looked at your budget, 60 percent of the FBI's money 
goes to counterterrorism, counterintelligence, and the intel 
function. Thirty-four percent goes to traditional crime-
fighting responsibilities. My first question is, is that the 
right ratio? Or is it that as we scrambled to fight the global 
war against terrorism and the massive need to shift resources, 
have we kind of left fighting crime a little bit behind? What 
would you say would be the actual resources you need, or are 
they pretty well amplified in this statement?
    Mr. Mueller. First of all, let me say the percentage that 
you give in terms of dollars may be roughly accurate. I will 
tell you that in terms of agents assigned to national security 
responsibilities as opposed to the criminal responsibility, 
it's almost 50/50 on the street. I will tell you that since 
September 11, understandably I believe, we have taken 
resources--substantial resources--from the criminal side of the 
house to address the counterterrorism mission. We have tried to 
establish priorities that maximize our capabilities to augment 
State and local law enforcement and other authorities in 
particular areas.
    I have always believed that when it comes to violent crime, 
the FBI should play a substantial role, because of our 
capabilities of reaching across jurisdictions. And, we have set 
up, as I----
    Senator Mikulski. But Director, do you feel that the 
President's budget is enough for you and your agents and 
analysts, and so on, to do the job of fighting crime and having 
the important linkages to local law enforcement with the unique 
role the FBI plays?
    Mr. Mueller. I believe at this juncture, we ought to 
revisit, as will happen through the budget process--normally 
within the administration, with the Department of Justice, with 
the Office of Management and Budget (OMB), but also with the 
subcommittee, our allocation of resources, given the uptick in 
violent crime with the possibility, given the budget 
constraints, of augmenting the FBI. I absolutely believe that 
we would benefit from additional resources.
    Senator Mikulski. Once we have this information, we'll talk 
with you about that in more detail.

                               TERRORISM

    Let's go to the global war against terrorism. One of the 
things that I've noted, that in addition to the very important 
intel function that you perform, that you're also now playing a 
very important role in the issue of weapons of mass 
destruction, some of which is too sensitive for a public 
hearing.
    But again, our question is--this requires very 
sophisticated people. These are people that require enormous 
scientific and technical backgrounds often more usually found 
in the Department of Defense (DOD), and it also takes a lot of 
money to do this. Could you share with the subcommittee, that 
as you do the surveillance and things that are important 
domestically and internationally, what about this new role of 
fighting the weapons of mass destruction? Should it be with 
you? And do you have the resources that you need to do this?
    Mr. Mueller. Well, responding to an attack of weapons of 
mass destruction in the United States is a responsibility of 
the FBI. I think it is appropriately a responsibility of the 
FBI, in large part because of the extent of integration we have 
with State and local law enforcement around the country, our 
presence around the country, and the expertise that we develop 
in this arena, some of it at Redstone Arsenal, as pointed out 
by Senator Shelby. So, I do believe we should have this 
mission.
    But it is an expensive mission. It requires contributions 
from a number of different skill sets and, as the Senator is 
well aware, those who are on the intelligence side of the house 
as well as this side of the house understand that we have 
requested substantial funding in that regard and my 
understanding is we're getting substantial funding to assist in 
that. But it is an expensive proposition, but I do believe we 
appropriately have that mission.
    Senator Mikulski. Well, my time has expired and I want to 
go by the rules. I would just like the subcommittee to 
understand, the FBI has now been given a very important 
responsibility, which is to, number one, make sure that a 
weapon of mass destruction does not fall into the hands of 
people who would want to use them in the United States of 
America. This is a pretty big job, against chemical, 
biological, and nuclear, big and small.
    Mr. Mueller. That's correct.
    Senator Mikulski. That's a pretty big deal. Then, in 
addition, there is something that is in your materials and that 
is an open document, but Senators could also get a briefing on 
this, called Render Safe, which means the FBI has also the 
job--that if a nuclear weapon, big or small, is detected, their 
job is to defuse it. This is big deal and it, and again, 
requires enormous sophistication.
    And, then also, for those who would want to bring these 
despicable and horrific weapons into our country, or seize them 
within our country, the stress, and the number, and the 
scientific and technological capability, even for surveillance 
is pretty significant. So, this isn't J. Edgar Hoover's FBI any 
more. And it's not like, let's hear a hoo-hah for gumshoe. So, 
we're talking about one, fighting gangs, dealing with meth, 
partnering with local law enforcement, and then these very 
sophisticated things.
    I'm going to yield now to Senator Shelby, but I would hope, 
also, that perhaps Senator Leahy will be picking up on the 
question of those national security letters.
    Senator Leahy. We are, yeah, we are.
    Senator Mikulski. Okay, thank you. Because that was a 
question I was going to go into.
    Senator Shelby.

                       NATIONAL SECURITY LETTERS

    Senator Shelby. Director Mueller, the inspector general 
issued a report critical of the FBI's use of national security 
letters. While I understand the critical need for these tools, 
the lack of supervision in the use of the national security 
letters and exigent letters is very troubling. Can you tell us 
what steps you're taking to correct the deficiencies and when 
those steps will be completed? You've testified previously that 
you would prefer administrative subpoena authority in 
counterterrorism cases to the existing national security 
letters (NSL) authority. Why do you prefer one tool over the 
other?
    Mr. Mueller. Let me start with what steps we've taken to 
address the issues with regard to NSLs.
    One of the first immediate steps we took was to expand on 
the audit that was done by the inspector general and to go 
across the country. I had 150 special agents, inspectors, visit 
every office to look at the use of national security letters. 
They have come back with information relating to the use around 
the country. I do not believe that, in the end, as we go 
through the information, there will be any startling 
differences between what we found and what the IG found. But 
nonetheless, it enables us to look at potential problems with 
more particularity.
    We are reviewing those findings now and my expectation is 
that, in working with the IG in the next several weeks, we will 
have some conclusions from that 10 percent audit. We are going 
back and looking at the numbers reported, our software and 
databases, to determine how we can retroactively identify, with 
more precision, the numbers that may have been left out. And 
again, we are working with the IG on that.
    I would say the third, well, let me talk about the third 
area, and that's the exigent letter issue. We have undertaken a 
joint investigation with the inspector general to determine how 
this happened, who was involved, and to make recommendations as 
to what further steps must be taken as a result of our 
findings. Again, it's a joint investigation with the inspector 
general. I think that will take several weeks, if not months, 
to follow-up thoroughly on that.
    Most importantly, what we did not have in the FBI was a 
compliance system, a compliance program. Large corporations 
have compliance programs. And, we had put into place 
procedures, but we had no way of assuring, on a daily basis, 
that those procedures were being followed.
    The $10 million that you mentioned in your opening remarks, 
with regard to following up on the NSL issue, will be used to 
establish a compliance office, reporting to the highest levels 
of the FBI, and addressing--not just the issues that we found 
with NSLs--but other issues to make certain that, whether it be 
NSLs or other circumstances, where Congress has given us the 
capabilities, that we are handling them appropriately, that the 
reporting to Congress is accurate and to make certain that what 
happened with NSLs does not happen again. And, I look at this 
as not just addressing the NSL issue, but addressing other 
issues within the Bureau that we can anticipate better and 
address, before the inspector general or Congress needs to 
address them.
    The last step I would say that we're taking is 
understanding--and agreeing with--the concerns of privacy 
groups, legitimate concerns, about the use of NSLs. We have 
undertaken outreach to the privacy groups and the civil 
liberties groups, to explain what steps we're taking and to get 
input. We may not always agree and, quite obviously, there'll 
be occasions where we disagree, but we will have a dialogue as 
to how we can do better in this regard, and have elicited input 
from these privacy and civil liberties groups. Those are the 
five steps that we are taking.
    Senator Shelby. What would--you mentioned administrative 
subpoena authority in counterterrorism cases.
    Mr. Mueller. One of the issues with the national security 
letters is the authorities are spread across a number of 
statutes. The predication for it and understanding the use of a 
particular NSL may depend on the type of records requested and 
falls under separate statutes. Administrative subpoenas would, 
hopefully, put in one place this authority. It would give, as 
the latest iteration of the Privacy Act has given, the right 
for somebody to contest it, as well as us to enforce it. And, 
so my hope would be that the administrative subpoena process 
would replicate, somewhat, the NSLs, but be much simpler for us 
to operate under.

                             BUDGET REQUEST

    Senator Shelby. Mr. Director, can you tell this 
subcommittee if the 2008 budget request, in your judgment, 
would meet your current operating needs?
    Mr. Mueller. My belief is there should be further 
discussion with the Department of Justice, with OMB and also 
with this subcommittee, as to the budget, because circumstances 
have changed in the last couple of years that, in my mind, 
warrant a revisiting of the issues.
    Senator Shelby. Madam Chairman, I have a number of 
questions that I would like to--because of the interest of time 
and the Director's schedule--submit to the record, for the 
record, that I think are important.
    Senator Mikulski. Without objection.
    Senator Shelby. Thank you.
    Senator Mikulski. Thank you very much.
    Mr. Mueller. Can I add one thing? I'm sorry.
    Senator Shelby. Sure.
    Mr. Mueller. In response to Senator Shelby's last question, 
in terms of the budget formulation, one of the things we've 
been asked to do, and believe it's important to do, is have a 
strategy in the Bureau, a long-term strategy. Not a year-to-
year strategy, but a long-term strategy.
    We are looking at budget requests over a 5-year period and 
believe that, for us, we should be on a 5-year cycle of budget 
requests. And, as we have developed the strategy, we are 
putting in place the requests over a 5-year period. That also 
will help, I believe, in supporting the discussion as to the 
budget request for 2008.
    The last point I'd make, I have to correct myself, I said 
the Privacy Act, I did mean the Patriot Act, in terms of the 
changes of the abilities of persons to contests NSLs and for us 
to enforce them.
    Senator Shelby. A 5-year budget plan would help you to plan 
more readily, would it not?
    Mr. Mueller. It would.
    Senator Shelby. Thank you.
    Senator Mikulski. Well, not only a 5-year budget plan, 
which we would certainly recommend because we could then look 
at how to pace this. But also the fact, that when we look at 
the funding of the intel agencies, you have to have more 
visibility to be at the table.
    Let me turn to Senator Leahy and, subcommittee members 
we'll come back for a second round. Senator Leahy.
    Senator Leahy. Thank you, Madam Chair. I had the privilege 
of serving on the Appropriations Committee and also, as the 
Director knows, I serve on the Judiciary Committee. And, I just 
want to take this opportunity to note, the Judiciary Committee 
still has not received answers to the written questions that we 
gave in connection with your March 14 appearance, or your 
appearance last year on December 6.
    Now, I understand that your responses have been submitted 
to the Department of Justice. That's all well and good, but we 
still don't have last year's responses or this year's 
responses. I don't think you would tolerate this kind of 
response time in FBI investigations.
    Before you leave, I will give you a copy and resubmit these 
as questions from the Appropriations Committee. Maybe that will 
help you get it through the Department of Justice quicker, 
because their budget will also come before this subcommittee.
    I've also raised with the Attorney General why they take so 
long clearing your answers to get them to us. We found last 
week that we will not get answers from him, but I would like to 
at least get answers from you.

                                SENTINEL

    Now, we're a year into the Sentinel computer upgrade, the 
costs go up all time. The FBI informed the Judiciary Committee 
you'd encountered unexpected problems with the deployment of 
phase one that could delay it. What is the current status of 
Sentinel? Do you anticipate additional delays, or cost 
overruns?
    Mr. Mueller. We are on budget, in fact we're under budget 
at this juncture on the first phase of Sentinel. In terms of 
the time, as I indicated in my opening remarks, we had hoped 
that we would start deployment in April. It looks like it will 
be deployed next month.
    We are in the final stages of the approval process with the 
contractor on phase one. One of the mistakes made by me, I 
would say early on, in terms of the computers, was pushing the 
process and the schedule. I had pushed hard, but I want to make 
certain that when it is deployed--my expectation is next 
month--that it works. I meet every week with the Sentinel team. 
I monitor it.
    Senator Leahy. That's just phase one. That's phase one.
    Mr. Mueller. Phase one. That is phase one. Now phase two, 
which is the more--in some senses, is the more important 
phase--because it addresses more of our business practices. We 
have started the planning on phase two. And we will have to--
there are a number of lessons we learned in phase one that 
we'll have to implement in phase two.
    Senator Leahy. When do you think phase two, the more 
important part, will be fully deployed?
    Mr. Mueller. I cannot give you an answer now on that.
    Senator Leahy. This year?
    Mr. Mueller. I would be concerned in giving you an answer.
    Senator Leahy. But you don't see it as happening this year?
    Mr. Mueller. Not this year. The original expectation was it 
would take another year to 18 months after the deployment of 
phase one to deploy phase two. But one of the things we learned 
in the development of phase one is that some of the things we 
anticipated deploying in phases two, three, and four, could 
better be moved up and other aspects of it moved down to phase 
four. Consequently, we are reviewing the lessons learned in 
phase one and over the summer and the fall we'll be determining 
how we proceed with phase two, three, and four.
    But, at this point, we have no belief that it is over 
budget or will be over budget. We have every belief, at this 
juncture, that we can do it under budget, in the timeframe that 
was originally set out for Sentinel.
    Senator Leahy. Well, are you still using Computer Sciences 
Corporation and CACI International?
    Mr. Mueller. No. Lockheed Martin is our contractor on 
Sentinel.
    Senator Leahy. Were Computer Sciences Corporation and CACI, 
in any way, part of the Sentinel contract team?
    Mr. Mueller. There was one aspect--let me just check--there 
was one aspect that one of the corporations that was involved 
in Virtual Case File is involved with Sentinel. I believe it 
was training, but it was a separate company, not part of the 
original company handling Virtual Case File. That is the case, 
there is one business element of one of those companies, at 
this point, that has a small role in Sentinel.
    Senator Leahy. Which one?
    Mr. Mueller. I believe it's, and I'd like to get back to 
you and firm it up, but I think it's Computer Sciences 
Corporation, it was bought by DynCorp.
    Senator Leahy. Well, please fill that for the record. 
Because I think if Computer Sciences and CACI were involved in 
the failed Virtual Case File project, I would hate to see them 
involved again. I'm also going to ask questions for the record 
on the integrated wireless network, 6 years in development, 
$195 million already being spent, an anticipated overall cost 
of $5 billion, and nobody has anything that works yet.
    [The information follows:]

           Sentinel Contractors Involved in Virtual Case File

    Two vendors are common to both Trilogy and Sentinel: 
Computer Science Corporation (CSC) and CACI. The division of 
CSC that worked on Trilogy, however, was part of a separate 
company at the time and not acquired by CSC until after the 
Trilogy contract ended. Furthermore, the after-acquired 
division of CSC will not be working on Sentinel, thus we 
anticipate little or no overlap of services or personnel. We 
have contracted with CACI to provide training for Sentinel, 
which was also CACI's role in the Trilogy contract. Training 
was not an issue in the execution of the Trilogy contract.
    The FBI has strengthened its internal controls to avoid a 
repeat of problems experienced with Trilogy. Among other 
things, we have improved our contract oversight in two major 
ways. First, the Sentinel contract has clear reporting 
requirements and severable deliverables. In other words, we can 
stop work if we are not satisfied with a contractor's progress. 
Second, we have structured our contract management with clearly 
defined roles and responsibilities, so accountable personnel 
are reviewing all documentation and expenses. That process will 
be supplemented by internal audits of our financial management, 
as well as external oversight from Congress and the 
Administration.

    Mr. Mueller. Can I respond briefly, Senator, if we have 
time? The Trilogy project was, as you know, three pieces. The 
networks, the computers, and two-thirds of it was successful, 
the other third was not successful. But I will also say in the 
development of the Sentinel project, we have had the inspector 
general review us day in and day out, and the Government 
Accountability Office (GAO), and we have endeavored to keep the 
committees apprised of the status of Sentinel, offering weekly 
briefings, now giving bi-weekly briefings, too, so that there 
is no miscommunication in terms of where we are at any 
particular point in time in the development of this project.
    Senator Leahy. Thank you, Madam Chair.
    Senator Mikulski. Thank you, Senator Leahy. You know, 
what's so great is, on our subcommittee now, we have the 
chairman of the Judiciary Committee, who has oversight of the 
FBI. We welcome you and your expertise.
    Senator Leahy. You might think it's greater than some of 
the witnesses might.
    Senator Mikulski. And Senator Kohl is also a member of the 
Judiciary Committee. Senators, I think the Director would also 
be wiling to brief both you and also your Judiciary Committee 
staff about the status of Sentinel. I think you'd be heartened 
about the progress.
    Senator Leahy. He does, he does.
    Senator Mikulski. Okay, thank you.
    Senator Kohl.
    Senator Kohl. Thank you, Madam Chairman.

                             VIOLENT CRIME

    Director Mueller, violent crime, as you've said, is on the 
rise across the country. When we ask State, local, and Federal 
officials in all our communities what needs to be done to get 
this problem under better control, they all give the same 
answer. They ask for greater Federal funding for State and 
local law enforcement. This administration is not giving our 
law enforcement officials the help that they need.
    For example, in Wisconsin, our share of Byrne funding went 
from more than $9 million in fiscal year 2002, all the way down 
to less than $3 million in fiscal year 2006. As a result of 
cuts to the COPS hiring programs, support to Milwaukee's Police 
Department to put more cops on the beat, went from more than $1 
million in 2002, down to zero these past 2 years.
    It's no surprise that the rise in violent crime has come on 
the heels of reductions in this administration's financial 
assistance to State and local law enforcement.
    Mr. Director, don't you agree that more Federal support for 
local law enforcement would greatly help our local communities 
in the battle against violent crime?
    Mr. Mueller. Well, I certainly am supportive of funding for 
State and local law enforcement from a variety of sources, 
including Federal. And, I would tell you that I believe that we 
work most efficiently when we work together with our State and 
local counterparts.
    And, what I'd like to see is the funding tied into working 
in task forces. We have 131 Safe Street task forces around the 
country. It harnesses our ability to reach across jurisdictions 
to obtain evidence, to provide forensics help and the like, but 
also provides the prioritization of what needs to be addressed 
in the community and a task force concept, I think, is 
tremendously important when you address gangs and some of the 
contributing factors to violent crime.
    So, I am, I have been and will continue to be, supportive 
of enhanced funding to State and local law enforcement in hopes 
that that funding will also be tied to participation on task 
forces, so that we maximize our work together.
    Senator Kohl. Well is this an ongoing kind of a process? 
Because, as I said, the direct funding for things like Byrne 
and COPS has gone down. Has it been augmented in some other way 
to local law enforcement?
    Mr. Mueller. Again, I am supportive of funding the State 
and local law enforcement.
    Senator Kohl. Right.
    Mr. Mueller. And, I'll leave the details up to the 
Department of Justice, that is the conduit for those grants.
    Senator Kohl. But the problem is so severe out there, you 
know, that the question of where does it come from is not 
nearly as important as getting the money out there so that our 
local law enforcement people can do their job more effectively. 
Not 2 or 3 or 4 years from now, but yesterday and today. Isn't 
that true?
    Mr. Mueller. I am absolutely supportive of funding for 
State and local law enforcement and, as I said I believe, I am 
also supportive in the context of doing it so that we work 
together.
    What we find, I will tell you, is it is increasingly 
difficult for State and local law enforcement to assign 
personnel to task forces because of the reduction in personnel. 
My belief is that task forces are tremendously important, and 
we ought to focus on the funding for State and local law 
enforcement in such a way that it enhances our joint efforts to 
address violent crime or counterterrorism or other threats, 
including cyber-crime and crimes against children, in a way 
that enhances our ability to work together and serves as an 
incentive for us to work together.

                              COPS PROGRAM

    Senator Kohl. All right. Just talk about the COPS program 
and get some comment from you. The overall COPS program was 
funded just a few years ago at more than $1 billion and this 
year the President's request for $32 million really means, 
basically, the end of the program. Last year in my home town of 
Milwaukee, the police department had approximately 200 
vacancies in an ideal force of 2,000. We used to have a program 
to deal with that problem and it was called, The Cops Universal 
Hiring Program. And, that program was instrumental at reducing 
crime in the 1990s.
    Unfortunately that program has been entirely eliminated in 
this administration. So, would you agree that we need a new 
commitment to the COPS program? Especially when we're 
witnessing a surge in violent crime in our mid-size cities and 
other sized cities all across our country. Don't you agree that 
we need to increase Federal funding in order to help put more 
police on the streets?
    Mr. Mueller. Without regard to a particular program, I am 
supportive of enhanced funding for State and local law 
enforcement, particularly funding to working cooperatively 
between ourselves, the Bureau of Alcohol, Tobacco, Firearms and 
Explosives (ATF), and the Drug Enforcement Administration 
(DEA), without regard to a particular vehicle.
    I think the vehicle is less important than the fact that we 
address the threats that are out there, when it comes to the 
uptick in violent crime. I attended a meeting a couple days ago 
at the National Academy of Sciences. One of the issues 
discussed by a number of very influential and capable 
professors from around the country was why this uptick. You can 
look at the statistics across the Nation, but then every 
community is somewhat different.
    What you do not want to do is, necessarily, just throw in 
resources without understanding what the problem is, what the 
solution is, and then assign those resources to effect that 
solution.
    In my own mind, most of the threats cross jurisdictional 
borders now. The solution comes from working together, 
ourselves with State and local law enforcement. To the extent 
that local communities cannot afford the participation of State 
and local law enforcement on task forces, I believe there has 
to be a mechanism someplace, through some vehicle, so that 
there is an incentive for us to work together and that we 
address these issues, together, as opposed to addressing them 
individually. Because I think we're far more effective when we 
do it jointly.
    Senator Kohl. I thank you so much.
    And, I thank you, Madam Chairman.
    Senator Mikulski. Senator Lautenberg.
    Senator Lautenberg. Thank you, Madam Chairman.
    And, thank you, Director Mueller, for being here and for 
providing the leadership that you do for this important arm of 
our protection and safety in our society.
    Oddly enough, Senator Kohl, my friend and colleague, hit on 
the subject, COPS. And, as I was looking over my notes, the 
thought occurred to me and I found out that at one point there 
were 120,000 police on the streets, 5,000 in my State of New 
Jersey from COPS. And, then your notes, Director, in your 
comments you say access to local law enforcement partners in 
the fight against violent crime, access to these crime-solving 
services and capabilities are more important in a post-9/11 
environment. So, it's hard to understand why that program might 
be eliminated when we need all the help we can get.

                           GUNS TO TERRORISTS

    Let me get on to something that's come about. A GAO report 
that I requested in 2005 revealed that 35 known or suspected 
terrorists bought guns in a 5-month period of 2004. And, then I 
asked you to review what legislative changes might be needed, 
and you wrote me in March 2005--so, we're looking back more 
than 2 years--that Department of Justice create a working group 
to look into this.
    Yesterday, the Department of Justice sent me, Vice 
President Cheney, and House Speaker Pelosi, a proposal to give 
the Attorney General the discretion to deny guns to terrorists. 
Do you think 2 years to move on something as sensitive and as 
helpful as this could be, borders on either outright neglect or 
lack of interest in the proposal? Should known terrorists be 
allowed to buy guns at all?
    Mr. Mueller. I can't speak to the delay, Senator. I think 
before one reaches any conclusion as to the delay, one would 
want to know what kind of dialogue there has been, whether it 
be within the administration, or between the administration and 
Congress. I see it was submitted yesterday. I would ask the 
opportunity to go back to look at this and then, to the extent 
that you have further questions in terms of what this 
legislation does, I'd be happy to answer them.
    Senator Lautenberg. Okay. But, and the last part of my 
question, should one's name on a terror list be sufficient 
evidence to not allow a gun to be purchased? What do you think?
    Mr. Mueller. I think it depends on the circumstances. There 
are gradations. I do not want guns in the hands of terrorists. 
You look at what happened at Virginia Tech recently, and it 
calls for a revisiting of the legislation, not just at the 
national level, but at the State level in terms of the 
production of medical records and particular mental health 
records----
    Senator Lautenberg. Okay. Thanks.
    Mr. Mueller [continuing]. When it comes to purchasing a 
weapon.
    Senator Lautenberg. Thanks, Mr. Mueller. The one thing that 
we do know is that you're an intelligent, educated man, and I 
find it surprising that we can't get a specific answer that 
says, ``No, they're terrorists.'' If you were good enough to 
use a somewhat humorous description, to get, to make it to the 
terrorist list and you can still buy a gun in this country, I 
think that suggests that there's a weakness there someplace.

                 BACKGROUND CHECKS TO INVESTIGATE CRIME

    I want to get on to something else. Would there be any 
value, Mr. Mueller, to permit law enforcement to use background 
check records to investigate crime, perhaps even in the case of 
terrorism?
    Mr. Mueller. I'm somewhat uncertain of the question.
    Senator Lautenberg. Well, that is----
    Mr. Mueller. Because, quite obviously, we use background 
information, to investigate allegations of terrorism.
    Senator Lautenberg. All right. Let me go to the little, 
expansion of that. Do you think that destroying records that 
were used in approving a gun purchase in just 24 hours, is a 
good idea? Perhaps you can explain--well, let me get the answer 
to part a, then we'll go to part b.
    Mr. Mueller. Well, I know there's been substantial debate 
on how long records are retained. There's a substantial 
argument in my mind for retaining records for a substantial 
period of time, but this is an area where the policymakers will 
advise and then we will follow.
    Senator Lautenberg. Fair enough. I'm glad that you concur 
with my view. Okay.
    Thank you, Madam Chairman. Thanks.
    Senator Mikulski. Thank you.
    Well, Director, we are moving expeditiously to get you to 
where you need to go.
    Mr. Mueller. Thank you.
    Senator Mikulski. I have two questions, one related to 
intelligence analysts and then the other to what we need to be 
able to train them.

                         INTELLIGENCE ANALYSTS

    I am tremendously impressed with the FBI intelligence 
analysts that I've met, both overseas and here. But here goes 
to my questions. Two years ago, the IG released a report that 
nearly one-third of the intelligence analysts positions were 
unfilled because of rapid turnover and other problems and also, 
at that time morale was low, and there was a difficulty in 
retention. Can you tell us what you've been able to do over the 
last 2 years with the issues raised by that? Do you remember 
that?
    Mr. Mueller. Yes.
    Senator Mikulski. And, then what are you doing to improve 
the training and retention of the intel analysts, particularly, 
you know, you had the agents on the street, but it is the 
analyst that's supposed to help the policymakers and the 
enforcers to connect the dots.
    The so-called ``connect the dot'' problem.
    Mr. Mueller. We have tremendously talented analysts. We've 
doubled our analyst cadre since September 11, and the 
qualifications and capabilities of the analysts are superb. 
They have become an indispensable asset not just at 
headquarters, but in every office around the country.
    The inspector general recently had a further report, in 
which, it was pointed out that we had a shortfall of 400 
analysts in 2006 that we had not brought onboard. He indicated 
part of it was attributable to the length of time it took to 
get an analyst onboard. But, I will tell you, part of it, also, 
was our recalibration of our strength in what was called 
``hollow work-years'' that had developed over a period of time. 
And so, we have a shortfall, currently, of approximately 160 
analysts who we're trying to bring onboard. And, we will over 
the next months and into next year.
    The delay in bringing people onboard that the IG mentioned, 
as well, is in some part attributable to the fact that we want 
to give them training. We want them to start the job with the 
training, and without slots for the training, we're delayed 
longer than we would like. And, I will tell you also, we are 
revamping the training. We have continuously done so--
particularly in the wake of September 11, but we continue to 
revamp the training to make it more successful, I will tell 
you, more effective.
    The other thing that the IG, I think, pointed out is that 
most of the analysts we brought onboard are exceptionally happy 
working at the FBI, enjoy their job, anticipate staying, so 
we're not, we are not where we would like to be. I'm not 
certain we would ever be there. I think we've made substantial 
strides with the analytical cadre.
    Senator Mikulski. Yes, because that will go to training in 
Quantico.
    Senator Shelby, you want to jump in here?
    Senator Shelby. Director Mueller, we realize it's--it's 
difficult and tedious to train analysts and, but in the 
recruitment area, because--how are you doing there? Because 
you're recruiting in the marketplace with everybody else?
    Mr. Mueller. Very well, very well.
    Senator Shelby. And, that's very important.
    Mr. Mueller. In the training, we have structured training 
so the analysts train with the agents for much of their time at 
Quantico, so there is an understanding of the kind of 
contributing skills that make us more successful.
    The fact of the matter is, as the organization grows, the 
credibility and the capability of the analysts will impress the 
rest of the organization and bring us into more of a team than, 
perhaps, we've been in past years. And, both through the 
training, the working together, and the types of cases, whether 
they be intelligence or criminal that we're working, I think 
we're making strides there.
    Senator Shelby. Thank you.
    Thank you, Madam Chairman.

                          TRAINING AT QUANTICO

    Senator Mikulski. Which takes me to Quantico. Because all 
FBI agents and analysts, regardless of their responsibility are 
trained at Quantico, am I correct?
    Mr. Mueller. Well----
    Senator Mikulski. Well, is it prime? Is my question.
    Mr. Mueller. All agents are trained at Quantico. There are 
areas of training that we do outside of Quantico, but certainly 
all new agents and analysts go through Quantico.
    Senator Mikulski. Right. So, but, Quantico is the starting 
point?
    Mr. Mueller. It is.
    Senator Mikulski. It is the starting point. Now, from what 
I understand from staff visits to Quantico, that Quantico 
because of when it was built, its original mission, which was 
the pre-9/11 FBI, that this is pretty dated, both in terms of 
being able to handle the number of people you wish to train, 
and what is required in unique training facilities now, with 
technology, et cetera. Could you share with the subcommittee 
what you think we need to do to help you, to kind of, 
reinvigorate Quantico? So that when these talented people come 
to serve, and you have the curriculum to do it, that we're all 
helping you move in the direction we want you to move in?
    Mr. Mueller. We've had problems with the buildings at 
Quantico. It's years and years, I can't tell you exactly, but 
tens of years old. We've had problems, for instance, with 
information technology and instituting it there because it was 
not set up with the modern capabilities.
    As we look 5 years down the road to the FBI, training is 
going to have to be expanded at Quantico, but also other places 
in the country. One of the gems, the jewels of the FBI is the 
National Academy, where every year we educate somewhat more 
than 1,000 State, local and, as important if not more 
important, foreign officers who become colleagues of ours, and 
my hope is that we could expand the National Academy. Because I 
think it's a jewel and it's tremendously important to the 
United States, not just domestically to have the capacity, but 
for the intersection of ourselves and the future with our 
counterparts overseas, to have that type of, not only dialogue, 
but building of relationships.
    So, whether it be National Academy, the agents, the 
professional staff, analysts, we are going to be looking at our 
5-year plan for expanding--not just renovating at Quantico--but 
looking at opportunities elsewhere as well.
    And, we cannot continue to build a national security 
function, and continue to do what we do on the criminal side 
without enhanced facilities.
    I will make one last plea, if I could, and that is, we are 
asked to be and appropriately so, I believe, the domestic 
intelligence agency for national security.
    Senator Mikulski. That's a pretty big deal.
    Mr. Mueller. Part of the intelligence community. We have a 
single funding stream that comes through Commerce, Justice, and 
Science, as opposed to being looked, from the funding 
perspective, as part of the intelligence community. And, my 
request is that, if we have the responsibility and the role 
that I believe we should have, we should be looked at as a 
member of the intelligence community from the perspective of 
funding.
    Senator Mikulski. You mean through an intel authorization?
    Mr. Mueller. Yes.
    Senator Mikulski. Well, you know we can't get one through 
the Congress, so you actually get a better deal coming through 
us. We hear what you say.
    Mr. Mueller. Well, when I look at the various budgets, I'm 
not----
    Senator Mikulski. Well, no, we understand that it, and 
again, this is an environment we can not discuss it.
    Mr. Mueller. Right.
    Senator Mikulski. Senator Shelby chaired the Intel 
Committee and, of course, I'm a very proud member. And, 
Director, we would suggest that this is something we three 
could talk about, about what is the most effective way.
    One quick question. When is this 5-year plan going to be 
done?
    Mr. Mueller. I believe we could start briefing you on it, 
probably, in a month.
    Senator Mikulski. Well, one of which, too, will be the 
issue related to facilities because if we have to get started, 
then those things, as you know, are an extensive look ahead. 
So, we'll look forward to that.
    But, listen, we promised you you'd be on your way and we 
want to thank you today for your testimony.

                     ADDITIONAL COMMITTEE QUESTIONS

    If there are no further questions, Senators may submit 
questions for the record. We would appreciate the FBI's written 
response within 30 days. We, Mr. Director, we look forward to 
an ongoing conversation with you, once we get our allocation 
and so, we want to get you on your way.
    And, we say to Eleni and Paul, good luck as they go on 
their new ways.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
            Questions Submitted By Senator Patrick J. Leahy
                                sentinel
    Question. Now a year into the Bureau's Sentinel computer upgrade 
program, I remain concerned about the prospect of this program and its 
ballooning costs to American taxpayers. Last month, the FBI informed 
the Judiciary Committee that it had encountered unexpected problems 
with the deployment of Phase 1 of the Sentinel program that would delay 
the program. Even more troubling, the FBI could not tell Judiciary 
Committee staff how long it would take to remedy these problems, or how 
the delay would impact the overall schedule for Sentinel.
    Director Mueller, what is the current status of the Sentinel 
program and do you anticipate that there will be additional delays in 
deploying the program or costs overruns?
    Answer. The FBI has implemented Phase 1 of the Sentinel Project and 
our agents are now using it. The prime contractor, Lockheed Martin, has 
completed the design, development, and testing of the Phase 1 
functionality and the FBI administered a two-week system acceptance 
test, which was followed by user acceptance testing. The system was 
then incrementally deployed and piloted in the Baltimore, Washington, 
and Richmond Field Offices and in one Division at FBI Headquarters 
(FBIHQ). In addition to testing the system's functionality, the pilot 
also assisted in testing the load of users on the system and in 
assessing the adequacy of the training materials.
    After changing the deployment approach to allow for a pilot period, 
the system was delivered to all users. Changes in the deployment 
approach and delivery schedule were made to ensure an accurate 
measurement of performance by testing it with actual users, rather than 
through controlled testing.
    The Sentinel Program Management Office and Lockheed Martin prepared 
users for training and deployment, training nearly 250 field office and 
FBIHQ users as Sentinel Training Advisors. This group is assisting 
contract instructors in providing training and assisting users in their 
divisions when questions arise. The training curriculum and materials 
continue to be refined to incorporate system updates and trainee 
feedback.
    Question. What impact have the delays with Sentinel--and Trilogy 
before it--had on the Bureau's ability to fulfill its core mission?
    Answer. The delays in updating the FBI's computer systems have had 
very little impact on the Bureau's ability to fulfill its core mission. 
All components of the FBI's Automated Case Support (ACS) system have 
continued to be operational and this information will be migrated to 
Sentinel. Phase 1 provides Sentinel's foundational base and enhanced 
access to the information contained in ACS. Phase 2 will bring 
additional capabilities to the users, including automated workflow, 
document and record management, public-key infrastructure, digital 
signatures, and role-based access controls.
    Question. The December 2006 OIG audit report questioned the 
reliability of the total estimated costs for the program. How confident 
are you about the final cost estimate for the Sentinel program?
    Answer. The estimated costs for the Sentinel program were developed 
consistent with the Federal Acquisitions Regulations (FAR), the 
Department of Justice (DOJ) Information Technology Investment 
Management (ITIM) process, and the FBI's Life Cycle Management 
Directive (LCMD) process. The FBI anticipates total program costs of 
approximately $425 million, including costs for development, program 
management, Independent Verification and Validation, and two years of 
Operations and Maintenance (O&M) after we reach full operating 
capability. Any changes to those estimates will be vetted through the 
ITIM and LCMD boards, documented in accordance with the FAR, and 
provided to Congress.
    Question. Based on this cost estimate, how much additional funding 
or reprogrammed funds will the FBI require to complete this program? If 
reprogramming is required, what programs do you anticipate will lose 
funds?
    Answer. The FBI determined that no additional reprogramming was 
required for fiscal year 2007 Sentinel operations. The funding 
requested in the President's fiscal year 2007 budget, in combination 
with the fiscal year 2007 reprogramming for Sentinel, funded O&M for 
Phase 1 and system development, training, and program management costs 
budgeted for Phase 2. Funding for Phases 3 and 4 and for the remainder 
of O&M for all Phases will be requested in future budget submissions. 
As noted in the response to the Office of the Inspector General (OIG), 
the FBI evaluates the operational impact of any proposed reprogramming 
and takes that impact into consideration in all reprogramming 
decisions. The FBI routinely provides this impact assessment and other 
relevant information to DOJ, the Office of Management and Budget (OMB), 
and Congress.
    Question. I am troubled by reports that two of the companies that 
are part of the Sentinel contract team--Computer Sciences Corp. and 
CACI International Inc.--also played roles in the earlier failed 
Trilogy effort. How do you justify entrusting these companies with 
taxpayer funds again?
    Answer. Two vendors are common to both Trilogy and Sentinel--
Computer Science Corporation (CSC) and CACI International, Inc. The 
division of CSC that worked on Trilogy (and actually a separate firm at 
the time of its Trilogy work, acquired by CSC thereafter) will not be 
working on Sentinel, so we anticipate little or no overlap of services 
or personnel. We have contracted with CACI to provide training for 
Sentinel, which was also the purpose of the Trilogy contract.
    The FBI has strengthened its internal controls to avoid a repeat of 
the issues cited by the Trilogy auditors with respect to all vendors. 
Among other things, we have improved our contract oversight in two 
major ways. First, the Sentinel contract has clear reporting 
requirements and severable deliverables. In other words, we can stop 
work if we are not satisfied with a contractor's progress. Second, we 
have structured our contract management with clearly defined roles and 
responsibilities, so accountable personnel are reviewing all 
documentation and expenses. That process will be supplemented by 
internal audits of our financial management, as well as by oversight 
from Congress and the Administration.
                             violent crime
    Question. Recently, the Seattle Post-Intelligencer reported that 
since the terrorist attacks of September 11 the number of criminal 
investigations conducted by the FBI has declined significantly, and 
white collar investigations in particular have dropped precipitously. 
Many cases that would have been pursued in the past are simply going 
unsolved. I have asked you in the past about declining prosecutions of 
public corruption cases and this study shows that the problem is even 
broader than was previously known. While it is crucial that the FBI 
devote all necessary resources to protecting the country from 
terrorism, that effort should not be at the expense of protecting the 
country from crime.
    Americans count on the FBI to aggressively investigate crime, 
particularly those types of crime that cannot always be adequately 
addressed by the states, like corruption, fraud, civil rights offenses, 
and the most serious violent crime. The FBI's apparent retreat from 
fulfilling these core duties comes at a time of rising violent crime 
rates in the country and dwindling public confidence in the 
Department's objective handling of corruption cases.
    Is the FBI capable of handling the dual tasks of protecting the 
country from terrorism and aggressively enforcing the nation's criminal 
laws at the same time? Why have you not been getting the job done?
    What steps is the FBI taking to make sure that it does not 
sacrifice crucial criminal investigations and prosecutions as a result 
of increased emphasis on terrorism?
    Answer. The number of FBI Special Agents (SAs) assigned to criminal 
cases has decreased by 1,335, or 21 percent, since the attacks of 9/11/
01. Despite the loss of those SA positions, protecting the nation from 
traditional criminal offenses has always remained a core function of 
the FBI, and 53 percent of all FBI SAs remain assigned to these 
criminal matters.
    To address this decrease, the FBI has made difficult choices in 
determining how to most effectively use the available agents. In 2002, 
the FBI established as its criminal program priorities: public 
corruption, civil rights, transnational and national criminal 
enterprises (which include violent gangs and the MS-13 initiative), 
white collar crimes (which include corporate fraud and health care 
fraud), and violent crimes (which include crimes against children).
    Since the designation of public corruption as the top criminal 
priority, over 280 additional agents have been shifted from other 
criminal duties to address corruption cases. The FBI is singularly 
situated to conduct these difficult investigations, and our 
effectiveness is demonstrated by the conviction of more than 1,000 
corrupt government employees in the past two years.
    The FBI has also maintained a steady commitment to addressing civil 
rights matters. Pending Color of Law (excessive force) investigations 
increased 25 percent from 2001 to 2007, and Human Trafficking cases 
increased 323 percent during the same period. FBI investigations of 
Human Trafficking resulted in 29 indictments in 2001; since then there 
have been an average of 48 each year.
    The FBI has addressed violent street gang matters through the 
establishment of Violent Gang Safe Streets Task Forces (VGSSTFs) that 
leverage Federal, state, and local law enforcement resources to 
investigate violent gangs in large, medium, and small cities and towns. 
There are currently 135 VGSSTFs composed of 600 FBI SAs and 1,170 
state/local law enforcement officers.
    Although the FBI has had to reduce the number of SAs working 
Governmental fraud matters since 9/11/01, FBI agents still respond to 
serious crime problems, as demonstrated by the FBI's current 
initiatives to address hurricane-related fraud and Iraq contract fraud.
    The FBI also prioritizes investigations within its White Collar 
Crime Program, emphasizing corporate/securities fraud and health care 
fraud. The corporate fraud cases, in particular, are very labor 
intensive, but they are a priority for the FBI because so many 
represent the private industry equivalent of public corruption, where 
the dishonest actions of a few people in leadership positions cause 
tremendous monetary losses and undermine investor confidence, both of 
which can threaten economic stability.
    The FBI's priorities have resulted in less of an emphasis on 
investigating traditional drug trafficking cases and more emphasis on 
assigning SAs to established Organized Crime Drug Enforcement Task 
Force (OCDETF) strike forces and High Intensity Drug Trafficking Area 
(HIDTA) initiatives that target violent gangs whose members are 
involved in drug trafficking.
    The FBI has also shifted criminal resources to implement the child 
prostitution initiative and the Violent Crime Task Force initiative. 
The child prostitution initiative is a coordinated national effort to 
combat child prostitution through joint investigations and task forces 
that include FBI, state, and local law enforcement, along with juvenile 
probation agencies. This initiative has resulted in more than 500 child 
prostitution arrests (local and Federal combined), 101 indictments, 67 
convictions, and the identification, location, and/or recovery of 200 
children. To address violent crime, the FBI has partnered with other 
state and local law enforcement agencies to create 24 Violent Crime 
Task Forces throughout the United States. The FBI also funds and 
operates 18 Safe Trails Task Forces (STTFs) to address violent crime in 
Indian Country (IC).
    In addition to the above initiatives, the FBI has continuously 
worked to use technology, intelligence analysis, and enhanced response 
capability to leverage criminal program resources. In October 2005, the 
National Crime Information Center's fugitive database was integrated 
with the Department of State passport application system, resulting in 
automatic notification when fugitives apply for United States 
passports. In December 2005, eight Child Abduction Rapid Deployment 
Teams were established in four regions of the United States. These 
teams are available to augment field office resources during the 
crucial initial stages of a child abduction. The FBI is currently 
developing a means of integrating sex offender registries and other 
public databases to better identify sex offenders in the vicinities of 
child abductions and to ``flag'' sex offenders who have changed 
locations without satisfying registration requirements.
    Question. Congress has always been willing to support both of these 
core missions. We have up to now been given the impression that the FBI 
was getting sufficient resources to do these jobs effectively. What 
more does the FBI need to live up to its responsibilities?
    Answer. The FBI has appreciated the support of Congress in ensuring 
that we have the necessary resources to deter and respond to terrorism 
and other crimes. We will continue to work with DOJ, the Office of the 
Director of National Intelligence, OMB, and the Congress to assess what 
resources are necessary to meet our responsibilities, consistent with 
Executive Branch priorities.
                      integrated wireless network
    Question. I was interested to see the March 2006 audit report by 
the Justice Department's Office of the Inspector General regarding the 
progress of the joint Integrated Wireless Network (IWN) for the 
Departments of Justice, Homeland Security, and Treasury. The OIG found 
that despite over 6 years of development and more than $195 million 
being spent on the IWN--out of an estimated $5 billion in total 
estimated costs with a goal of supporting 81,000 federal agents by 
2021--DOJ law enforcement agents have received little in the way of 
new, secure, compliant radio equipment through IWN. The causes for the 
risk of failure include uncertain funding to complete the project, 
disparate departmental funding mechanisms, a fractured IWN partnership, 
and the lack of an effective governing structure for the project. What 
results from this partnership likely will not be the seamless, 
interoperable system that was originally envisioned and therefore the 
communication systems may not be adequate in the event of another 
terrorist attack or national disaster.
    The OIG offered four recommendations for the Justice Department in 
attempting to avoid the IWN train wreck looming on the horizon.
    Do you feel that those recommendations should be followed in order 
for the IWN to become the seamless, interoperable system originally 
envisioned? If not, why and how best do you feel the goal of a 
seamless, interoperable system would be reached?
    Answer. While a valid goal, seamless interoperability does not 
address the immediate needs of DOJ components. The nationwide trunked 
network originally envisioned by some has not been a simple or easy 
undertaking (as demonstrated by the challenges encountered in 
Washington State). A single nationwide system would put those users on 
the same network, but this would not always make the best use of the 
available spectrum. Using trunked networks within a single band (which 
are more spectrally efficient than large-scale, multi-channel 
conventional systems) would not resolve the interoperability issues 
inherent in a system in which Federal, state, and local users use 
alternate frequency bands.
    Evolutionary solutions would provide opportunities for components 
to address their own internal requirements while addressing 
interoperability needs and unnecessary redundancy among DOJ components. 
Current FBI Land Mobile Radio (LMR) systems using the Digital 
Encryption Standard (DES), which is no longer approved for use in 
Sensitive but Unclassified systems, put users at risk for potential 
compromise. These antiquated component systems must be upgraded to meet 
security requirements (such as the Advanced Encryption Standard) while 
satisfying the narrowband mandate and providing enhanced feature sets.
    Future capabilities will include not only multiband, multimode 
radios, but the ability to interoperate with state and local partners 
through multiple gateways.
    Question. What part, if any, has the FBI played in implementing 
those recommendations? How would you define the Bureau's commitment and 
funding requirements to support the network?
    Answer. The FBI has been working with others in DOJ since 1999, 
providing both technical expertise and personnel in their planning, 
design, infrastructure installation, site leasing, spectrum 
coordination, equipment testing, and decommissioning efforts, among 
others. For example, FBI personnel in both Seattle and Portland have 
played an active role in Integrated Wireless Network (IWN) 
implementation, providing expertise and support in order to help make 
the network there a functional reality.
    The FBI's current network infrastructure includes over 3,000 sites 
nationwide, and the cost of system maintenance, site leases, and 
circuit costs are directly affected by IWN's size and capabilities. 
Reduction of the FBI's maintenance costs depends on the installation of 
new equipment as part of either IWN or FBI system/network upgrades. 
Cost savings can be realized either by fully implementing IWN as 
envisioned and decommissioning FBI sites or by downsizing DOJ 
components where permitted by system sharing.
    Question. Through fiscal year 2006, approximately $772 million has 
been appropriated to fund the DOJ Narrowband Communications Account. 
However, instead of funding new technological solutions and upgrades, 
nearly two-thirds of this funding has been used to maintain DOJ's 
antiquated legacy systems. The OIG report found that the majority of 
DOJ's communications systems are obsolete because the manufacturers no 
longer support them, maintenance is difficult and spare parts are hard 
to find. As the DOJ equipment continues to age, these costs are 
expected to increase by five percent each year.
    Between a lack of money because funds that should be used for new 
technology solutions and upgrades are being poured into DOJ's antiquate 
legacy systems, and the rising cost of operating and maintaining legacy 
communications, can you tell me when you expect the IWN to be up and 
running so that the Bureau's agents can access and use the latest in 
interoperable technologies to communicate and coordinate with their 
fellow federal, state and local law enforcement partners?
    Answer. Full migration to a new, DOJ-level, trunked VHF network 
requires not only extensive planning and spectrum coordination, but 
also site preparation and circuit leasing, and these to a much greater 
extent than if the upgrade were to a single organization's system. In 
order to deploy new systems, several issues must be addressed. For 
example, we must upgrade radios in the field as necessary; address 
licensing limitations and the need for compatibility with 
manufacturers' infrastructures; either negotiate new site leases or 
modify existing leases based on new requirements; address access and 
security requirements; and realign and approve spectrum allocations 
while formulating transition schedules. In the interim, although aging 
wideband legacy LMR systems are antiquated, they can be upgraded to 
newer, narrowband, conventional equipment relatively easily, networks 
can be expanded, and capabilities enhanced.
    O&M expenses are a significant part of the cost of any large-scale 
system or network. Site repairs, security upgrades, network expansion, 
radio installations, personnel, and training are among the areas funded 
by DOJ components before the consolidation of those individual 
resources. The integration of multiple systems requires experienced 
engineers and government personnel who understand implementation needs 
to ensure proper oversight, control, and system availability. For 
example, even following integration, these networks must remain 
functional at key local levels during times of crises to ensure the 
public is protected if one agency or one part of the system is 
compromised.
    Question. What impact has the lack of a functioning IWN had on the 
FBI's ability to carryout its counterterrorism mission?
    Answer. Absent the ability to communicate securely with other 
investigative personnel, FBI personnel use other alternatives, such as 
commercial services. Commercial devices operate on commercial networks, 
which may have inadequate capacity in times of crises, may not meet 
security requirements, and may operate only in areas with adequate 
infrastructure. For example, commercial LMR peer-to-peer (device-to-
device) capabilities usually require that the infrastructure be 
operational at the time of attempted communication. In the absence of 
secure communications capabilities, outsiders (including suspects) can 
use frequency monitoring devices (scanners) to track unencrypted online 
communications. Unlike most portable devices currently used by the FBI 
in the field, newer radio models are smaller, can be used to send e-
mails and broadcast messages, provide greater voice clarity, and regain 
range that is lost to systems using DES encryption.
                   intellectual property enforcement
    Question. By some government estimates, U.S. companies suffer $250 
billion in annual losses due to intellectual property theft, which also 
causes U.S. workers to lose millions of jobs. Aggressive investigation 
and prosecution of IP crimes is clearly needed to deter such massive 
infringement. In recognition of this need, the Justice Department's IP 
Task Force, in its October 2004 Report and a subsequent June 2006 
Progress Report, recommended increasing the number of FBI agents 
investigating intellectual property crimes.
    Would you agree with the Task Force's recommendation that, to 
effectively deter rampant IP infringement, there should be an increase 
in the number of FBI agents dedicated to investigating IP crimes?
    Answer. The FBI SAs assigned to cyber crime programs in the FBI's 
field offices address intellectual property (IP) infringement matters 
in the same manner as they address other FBI violations, which is based 
upon FBI investigative priorities. IP infringement matters that pose a 
threat to national security (such as certain thefts of trade secrets) 
are the FBI's highest IP infringement priority. The number of SAs 
working IP matters has decreased since fiscal year 2005 due to the 
November 2004 re-ordering of cyber priorities, pursuant to which 
Innocent Images matters were placed in a higher priority than IP 
rights. In fiscal year 2005 there were approximately 56 SAs working IP 
investigations, while in June 2007 there were 48.
                       national security letters
    Question. Director Mueller, as you know, I am very concerned about 
the widespread abuse of National Security Letters (``NSLs'') at the 
FBI. Last month, the Justice Department's Inspector General recently 
reported on a pattern of unacceptable abuses of NSLs by the FBI, where 
time and time again the FBI did not follow the law, or even its own 
rules, in obtaining sensitive personal information about thousands of 
ordinary Americans and others. According to the Inspector General's 
report, one in every five of the NSL files reviewed contained 
violations of the law, and more than half of the NSLs reviewed did not 
even meet the FBI's own standards. During the FBI Oversight hearing 
that the Judiciary Committee held last month, you promised to promptly 
address the serious lapses with NSLs.
    Director, what are you doing to make sure that the FBI follows the 
law--and its own policies--when issuing National Security Letters going 
forward?
    Answer. As a result of the OIG report, the FBI has prepared 
comprehensive guidance concerning the use of National Security Letters 
(NSLs). Every proposed NSL must be reviewed by the Chief Division 
Counsel in each FBI field office or by an attorney in the National 
Security Law Branch (NSLB) at FBIHQ, including review of the relevance 
of the request to an authorized investigation and the predication for 
that investigation. In addition, NSLB is developing a training 
curriculum, which will be mandatory for all employees involved in the 
NSL process, to address problems created by confusion and lack of 
familiarity with the provisions and requirements of the various 
statutes authorizing NSLs. Even before the OIG report was published, 
the FBI had begun work on a database, based on the successful ``FISA 
Management System,'' that will permit the electronic transfer of NSL-
related data between databases (this transfer is currently being 
accomplished manually). Finally, the Inspection Division is 
investigating in more detail many of the problems identified in the OIG 
report. This review should identify any areas that require closer 
scrutiny. Taken together, these measures will both provide a more user-
friendly business process for FBI personnel who use NSLs as an 
investigative technique and enhance management's audit and oversight 
capabilities. This system will also enhance the accuracy of the NSL 
reports provided to Congress.
    The FBI has also recognized the need to create a compliance program 
to ensure we have appropriate policies, procedures, audit capabilities, 
and training for all our activities. The FBI's compliance program will 
be modeled after similar programs in the public and private sectors. 
While it is too early to say with certainty what the program will look 
like, it will most likely incorporate features common to most 
successful programs, such as a written compliance policy, a central 
compliance officer and office, a senior-level compliance committee, 
access to and the ability to draw upon the resources of the 
organization, and an implementing strategy that adjusts as new threats 
and programs are identified. Audits of practices, not just procedures, 
will be an essential component of the program, as will effective ``two-
way'' communication channels. In addition, OGC will continue to meet 
regularly with DOJ's National Security Division (NSD) to discuss 
appropriate policies in the national security arena. DOJ's NSD and the 
FBI's NSLB conducted 14 national security reviews of the FBI's field 
offices and one of an FBI Headquarters Division in calendar year 2007. 
There are 14 national security reviews of the FBI's field offices and 
one of an FBI Headquarters Division planned for calendar year 2008. 
Those reviews will include, but not be limited to, the use of NSLs.
    Question. One of the most disturbing findings in the Inspector 
General's Report was that the FBI improperly issued more than 700 so-
called ``exigent letters,'' seeking telephone and financial records on 
an emergency basis, which contained blatant factual misrepresentations. 
Is the FBI still using these so-called ``exigent letters,'' and if so, 
based upon what legal authority?
    Answer. The OIG identified four problems with the so-called exigent 
letters as they were used by the FBI's Communications Analysis Unit 
(CAU): (1) although the letter asserted there were exigent 
circumstances, that was not always the case; (2) the CAU maintained no 
records supporting the claimed emergency; (3) although many of the 
letters asserted that a Federal grand jury subpoena had been requested, 
in fact, in most circumstances a grand jury subpoena had not been 
requested and the intent was to provide the carrier with an NSL; and 
(4) in many cases, although subsequent legal process had been promised 
to the carrier, no process (neither a grand jury subpoena nor an NSL) 
was delivered in a timely fashion.
    It was not until the FBI received the draft OIG report that 
executive leadership became aware of the full scope of the problems 
with the use of the so-called exigent letters. Upon learning of this 
matter, the FBI worked quickly to develop policy that would address the 
shortcomings identified in the OIG report without undermining the FBI's 
ability to receive information under 18 U.S.C.  2702(c)(4), a critical 
provision allowing communications service providers to give the 
government information in certain emergency circumstances. That policy, 
which was issued on 3/1/07, discontinued the use of ``exigent letters'' 
of the sort described in the OIG report, but affirmed that the FBI may 
continue to receive information pursuant to section 2702. The new form 
2702 letter makes it very clear that: production of the records is at 
the carrier's discretion; no other legal process is promised; and, by 
policy, the emergency justifying this requirement must be documented. 
Accordingly, the FBI believes the new policy deals precisely with the 
problems identified by the OIG and appropriately balances privacy 
concerns with investigative needs in case of dire, life-threatening 
emergencies.
                          privacy/dna sampling
    Question. Pursuant to a little noticed provision in the Violence 
Against Women and Department of Justice Reauthorization Act of 2005, 
the Justice Department is developing new guidelines that would greatly 
expand the government's ability to collect DNA samples--which reveal 
the most sensitive genetic information about an individual--from most 
individuals who are arrested or detained by federal authorities. Under 
this policy, the Government will store this sensitive biological 
information in a federal data base known as the National DNA Index 
System.
    I am very concerned about the privacy implications of this new 
policy because, unlike fingerprinting--which is commonly used as a 
means of identification--DNA profiles reveal all kinds of sensitive 
biological information about a person, including the presence of a 
physical disease or mental disorder.
    Director Mueller, what privacy protections are in place under these 
new guidelines to ensure that sensitive DNA data contained in the 
National DNA Index System will not be misused or improperly disclosed 
by the Justice Department?
    Answer. While the FBI is working with others in DOJ to finalize the 
regulations on DNA sample collection relative to federal arrestees and 
detainees, there are already a number of protections in place and they 
are vigorously enforced. When arrestee and detainee DNA samples are 
collected, they are placed in the National DNA Index System (NDIS) 
offender database. The offender and crime scene databases are populated 
by profiles from Federal, state, and local law enforcement agencies. 
The profiles within the database use only genetic markers that provide 
identification; no other genetic information, such as medical status, 
can be gleaned from these markers, and NDIS, which is in essence a 
pointer system, does not contain any names or personally identifying 
information. Instead, each profile is associated with a unique 
identifier that traces back to the laboratory that developed that 
particular profile and placed it in the database. Once a ``hit'' occurs 
and is confirmed, then the two laboratories involved will exchange 
information regarding the individual involved.
    Although all states participate in NDIS, they do not have direct 
access to the national database. NDIS is searched once a week at the 
FBI and a hit report is generated. If an individual lab wants to follow 
up on a particular hit (generally the lab that contributed the forensic 
sample), it contacts the laboratory that provided the offender 
information and a confirmation process begins. During that process, the 
laboratories follow written procedures to ensure the hit is related to 
the correct offender; these procedures include re-working a portion of 
the remaining sample and re-comparing results. Under procedures 
established by the NDIS Board, no names or other personally identifying 
information may be reported until the confirmation process is complete.
    Federal law also provides privacy protections, including criminal 
penalties. By law, NDIS may only include DNA information that is:
    Maintained by Federal, State, and local criminal justice agencies 
(or the Secretary of Defense in accordance with section 1565 of Title 
10) pursuant to rules that allow disclosure of stored DNA samples and 
DNA analyses only--
  --(A) to criminal justice agencies for law enforcement identification 
        purposes;
  --(B) in judicial proceedings, if otherwise admissible pursuant to 
        applicable statutes or rules;
  --(C) for criminal defense purposes, to a defendant, who shall have 
        access to samples and analyses performed in connection with the 
        case in which such defendant is charged; or
  --(D) if personally identifiable information is removed, for a 
        population statistics database, for identification research and 
        protocol and development purposes, or for quality control 
        purposes. (42 U.S.C.  14132(b)(3).)
    These protections are further bolstered by provisions that 
reiterate these protections and provide criminal penalties for 
individuals who knowingly disclose DNA information from the database to 
a person or agency not authorized to receive it. (See, for example, 42 
U.S.C.  14133(c) and 42 U.S.C.  14135e(c).)
    Finally, we are conducting a privacy impact assessment to analyze 
how this DNA information will be handled, determine risks from 
processing this information, and identify protections to help mitigate 
any privacy risks.
    Question. Another concern that I have about this policy is that it 
will just add to the already notorious backlog at the FBI's laboratory. 
According to press reports, the FBI acknowledges that this new policy 
will result in an increase of as many as one million additional DNA 
samples a year. Is the Bureau's laboratory equipped to handle this 
additional workload?
    Answer. The FBI's Federal Convicted Offender (FCO) Program is 
responsible for collecting and processing DNA samples collected from 
those convicted of Federal felonies for the purpose of retention and 
cataloging in the FBI's National DNA Database. The FCO Program supplies 
collection kits and receives samples from over 500 collection sites 
across the country. Since the program's inception in June 2001, over 
225,000 samples have been received. The FCO Program currently receives 
7,000 to 8,000 samples monthly. To date, the FCO Program has uploaded 
over 34,000 samples into the National DNA Database, which has resulted 
in over 600 hits. The volume of sample submissions to the FCO Program 
has increased dramatically since 2001.
    While much of the DNA analysis process has been automated, a 
bottleneck continues to exist at the DNA data review stage, which is 
currently conducted manually. To alleviate this bottleneck, the FBI is 
evaluating data analysis software packages or expert systems to 
automate this part of the process. Once implemented, the resulting 
system would be able to assess 85 percent to 90 percent of the 
convicted offender data without manual intervention, reducing data 
analysis time from approximately 60 minutes (per 80 samples) to less 
than 15 minutes (a four-fold increase in efficiency).
questions submitted by senator leahy pursuant to the december 6, 2006, 
       senate judiciary committee hearing regarding fbi oversight
    The FBI's responses to the Questions for the Record (QFRs) posed by 
Senator Leahy to Director Mueller following the December 6, 2006, 
Senate Judiciary Committee hearing, and resubmitted following this 
hearing, were provided to the Senate Judiciary Committee by letter 
dated June 14, 2007, along with the rest of the QFRs posed to the FBI 
following that hearing. Please refer to the record for the responses to 
those questions.
Iraq Study Group Recommendations
    1. In its recent report about the situation in Iraq, the bipartisan 
Iraq Study Group found that the Iraqi Police Service (``IPS'') is in 
dire straits. In particular, the report states (on pages 9-10):
    The state of the Iraqi police is substantially worse than that of 
the Iraqi Army. The Iraqi Police Service currently numbers roughly 
135,000 and is responsible for local policing. It has neither the 
training nor legal authority to conduct criminal investigations, nor 
the firepower to take on organized crime, insurgents, or militias . . . 
Iraqi police cannot control crime, and they routinely engage in 
sectarian violence, including the unnecessary detention, torture, and 
targeted execution of Sunni Arab civilians. . . . There are ample 
reports of Iraqi police officers participating in training in order to 
obtain a weapon, uniform, and ammunition for use in sectarian violence. 
Some are on the payroll but don't show up for work. In the words of a 
senior American general, ``2006 was supposed to be `the year of the 
police' '' but it hasn't materialized that way.
    In recommendation #54 of the report, the Iraq Study Group advocates 
having the Justice Department direct the training mission of the IPS 
forces that remain within the Iraq Ministry of the Interior.
    (a) Please state whether you agree with this recommendation and 
explain your response.
    (b) What role has the FBI had in the training of the Iraqi police, 
thus far?
    (c) What additional steps will the FBI take to train the IPS in 
light of the Iraq Study Group's report and in particular, this 
recommendation?
    2. In recommendation #57, the Iraq Study Group recommends that the 
practice of embedding U.S. police trainers with Iraqi police units be 
expanded and that the number of civilian officers training Iraqi police 
be increased.
    (a) Please state whether you agree with this recommendation and 
explain your response.
    (b) Are there currently any FBI agents embedded with the Iraqi 
Police Service? If so, how many?
    (c) Will the FBI provide additional police trainers to participate 
in the training of the Iraqi Police Service and, if so, how many?
    3. In recommendation #58, the Iraq Study Group further recommends 
that the FBI expand its investigative and forensic training and 
facilities in Iraq, to address both terrorism and criminal activity.
    (a) Please state whether you agree with this recommendation and 
explain your response.
    (b) How many FBI agents and personnel are currently providing 
investigative and forensic training in Iraq?
    (c) How many FBI agents and personnel are currently assisting with 
counterterrorism activities in Iraq?
    (d) Will the FBI expand its role in these programs as the Iraq 
Study Group recommends and, if so, what additional resources, including 
staff, equipment and funding, will be dedicated to that effort?
    4. Public corruption is a significant problem in Iraq. According to 
the Iraq Study Group's report, one senior Iraqi official estimated that 
official corruption cost the Iraqi Government between $5 and $7 billion 
per year. To address the rampant corruption in Iraq, the Iraq Study 
Group concludes that Justice Department programs to create institutions 
and practices to fight public corruption in Iraq ``must be strongly 
supported and funded.''
    (a) What resources, including staff, equipment and funding, does 
the FBI currently have dedicated to helping to fight public corruption 
in Iraq?
    (b) Will the FBI increase the resources that it currently has in 
Iraq to further assist the Iraqi government in fighting public 
corruption?
Datamining/ATS and IDW
    5. At the hearing, I asked you about the Department of Homeland 
Security's Automated Targeting System (``ATS'') and recent revelations 
that, since 9/11, the Bush Administration has been using this program 
to secretly assign terror scores to millions of law-abiding Americans 
who travel across our borders. You were not prepared to answer my 
questions about ATS at the hearing; however, you stated that you would 
look into this matter. Please respond to the following questions:
    (a) During an unclassified briefing for Judiciary Committee staff, 
the Department of Homeland Security said that it shares the sensitive 
personal information in the ATS database with the FBI and checks the 
information in this database against the Terrorist Watchlist. Does the 
FBI receive the terror scores or assessments and the other information 
contained in the ATS database? Please describe the information that the 
FBI receives from ATS and explain how the Bureau uses this information.
    (b) Does the FBI use the information that it receives from ATS to 
assist it in investigating traditional criminal cases as well as 
counterterrorism matters?
    (c) What safeguards are in place at the FBI to ensure the accuracy 
of this information and to protect the privacy interests of the 
millions of law-abiding Americans whose sensitive personal data is 
contained in ATS?
    6. You also testified that you would check into whether the FBI's 
own Investigative Data Warehouse database (``IDW'')--which now contains 
more than 560 million FBI and other agency documents--shares 
information or data with ATS. Does the IDW database share information 
or otherwise interface with the ATS data-mining program?
    7. You further testified that the FBI has issued a privacy impact 
statement for IDW.
    (a) Has the Bureau publicly released this privacy impact statement 
for IDW and, if not when will the FBI do so?
    (b) Has the FBI filed a notice in the Federal Register regarding 
the IDW program? If not, why not, and when will the Bureau do so?
    8. What policies are in place to ensure the accuracy and security 
of the sensitive personal data contained in the IDW database?
Detainee Treatment
    9. Last year's Detainee Treatment Act and this year's Military 
Commissions Act both set standards for what types of interrogation 
techniques are and are not permissible. In each case, though, the 
standards are general and open to interpretation.
    (a) Did the Office of Legal Counsel or any other legal office at 
the Justice Department or the FBI provide guidance to the FBI regarding 
how to interpret the provisions of the Detainee Treatment Act governing 
what interrogation practices are permissible?
    (b) What form did this guidance take? Did it dictate what specific 
interrogation techniques can and cannot be used?
    (c) What was the substance of this legal guidance? Will you share 
this document with the Committee?
    10. Has the Office of Legal Counsel or any other legal office at 
the Justice Department or the FBI provided guidance to the FBI 
regarding how to interpret the provisions of the newly passed Military 
Commissions Act governing what interrogation practices are permissible?
    (a) If so, what is that guidance? Please provide a copy of any 
legal guidance provided to the FBI regarding the Military Commissions 
Act.
    (b) If not, please explain how your agents know what is permitted 
or prohibited by the broad language of the Military Commissions Act 
without legal guidance. Do you expect to receive legal guidance in the 
future?
    11. An FBI Supervisory Special Agent at Guantanamo Bay wrote a memo 
in November 2002 entitled ``Legal Analysis of Interrogation 
Techniques,'' in which he or she concluded that rendering terrorism 
suspects to ``Jordan, Egypt, or another third country to allow those 
countries to employ interrogation techniques that will enable them to 
obtain the requisite information'' would violate 18 U.S.C. Sec. 2340 
(the torture statute). Specifically, the memo states:
    In as much as the intent of this category is to utilize, outside 
the United States, interrogation techniques which would violate 18 
U.S.C. Sec. 2340 if committed in the United States, it is a per se 
violation of the U.S. Torture Statute. Discussing any plan which 
includes this category, could be seen as a conspiracy to violate 18 
U.S.C. Sec. 2340. Any person who takes any action in furtherance of 
implementing such a plan, would inculpate all persons who were involved 
in creating this plan. This technique cannot be utilized without 
violating U.S. Federal law.
    Legal Analysis of Interrogation Techniques (available online at 
http://www.humanrightsfirst.org/us_law/etn/pdf/fbi-brief-inter-
analysis-112702.pdf).
    (a) Do you agree that the ``technique'' of rendering suspects to 
third countries in order to allow those countries to use coercive 
interrogation techniques that violate U.S. law ``cannot be utilized 
without violating U.S. Federal law''?
    (b) Does the legal analysis contained in the November 2002 memo 
reflect the FBI's current thinking with respect to rendition and other 
interrogation techniques? If not, how does the FBI's current analysis 
differ from the analysis in the memo?
    12. You testified that the FBI is not investigating any of the 
allegations that have been made by German national Khalid El-Masri and 
others regarding possible violations of U.S. law in connection with the 
rendering of individuals to foreign countries. Why isn't the FBI 
investigating these allegations?
Brandon Mayfield
    13. In December, the government agreed to pay $2 million to settle 
a case that had been brought by Oregon lawyer Brandon Mayfield. Mr. 
Mayfield was jailed for two weeks in 2004 as a material witness, in 
connection with the Madrid train bombing. As part of the settlement, 
the government made a formal apology to Mr. Mayfield and his family for 
the suffering caused by his mistaken arrest. Mr. Mayfield was arrested 
and held for two weeks on a material witness warrant. Under the 
material witness law, the government is authorized to arrest a witness 
to secure his testimony in a criminal proceeding. After the 9/11 
attacks, the Justice Department began using the material witness law 
not to secure testimony from possible witnesses, but rather to lock up 
possible suspects in counter-terrorism investigations without charge 
until there is enough evidence to indict. Is it accurate to say that 
this is what happened in the Mayfield case?
    14. The Second Circuit Court of Appeals wrote in 2003 [in the 
Awadallah case] that the purpose of the material witness law is to 
secure testimony where it may become impracticable to secure the 
presence of the witness by subpoena. The Court added: ``It would be 
improper for the government to use [the material witness law] for other 
ends, such as the detention of persons suspected of criminal activity 
for which probable cause has not yet been established.'' Do you agree 
that it is improper for the government to use the material witness law 
for purposes other than securing testimony?
    15. The government noted as part of the settlement with Mr. 
Mayfield that the FBI had taken steps ``to ensure that what happened to 
Mr. Mayfield and the Mayfield family does not happen again.'' What 
steps has the FBI taken? Do they include any new guidance respecting 
the use of the material witness statute?
Sentinel
    16. You testified that there will be no cost overruns or budget 
shortfalls for the Sentinel program. However, in December 2006, the 
Department of Justice Office of Inspector General (``OIG'') released a 
report that found that the FBI will need an additional $56.7 million 
over what the President requested in his budget for next year to 
continue the Sentinel project, and that these additional costs could 
have an adverse impact on the FBI's counterterrorism and other 
programs. The OIG's report also calls the FBI's cost estimate for the 
Sentinel program into serious question.
    (a) Does the FBI need additional funds to pay for Phase II of 
Sentinel and if so, how much additional funding is needed?
    (b) You testified that the FBI has set aside $57 million to make up 
the difference between the President's $100 million budget request for 
Sentinel and the anticipated program costs for Phase II. What FBI 
programs will be cut back or eliminated in order to use these funds to 
pay for Sentinel?
    (c) Will you promptly inform Congress of Sentinel's operational 
impact on other FBI programs if reprogramming of funds is necessary to 
pay for Sentinel?
    17. Earlier this year, the Government Accountability Office 
(``GAO'') found that the FBI paid about $10.1 million in unallowable 
costs to contractors during the Trilogy program. You have said that the 
FBI would pursue these funds upon completion of a closeout audit of the 
Trilogy program by the Defense Contract Audit Agency. When will the FBI 
start to recover these taxpayer funds?
    18. Another concern raised by the GAO is the FBI's over-reliance on 
government contractors to complete Sentinel. According to the GAO, 77 
percent of the positions for Sentinel will be filled by contractors 
rather than by government personnel. Given the FBI's past experiences 
with contractors on the Trilogy program, is the Bureau overly relying 
on contractors for Sentinel?
Arabic-speaking Agents and Translators
    19. Despite progress on hiring Arabic translators, the FBI lags far 
behind when it comes to the number of agents who are proficient in 
Arabic. Recently, The Washington Post reported that only 33 FBI agents 
have at least a limited proficiency in Arabic and only 1 percent of FBI 
agents have any familiarity with the language.
    (a) How can the FBI effectively fight the war on terror when most 
of its agents lack even a basic proficiency in the Arabic language?
    (b) How has the lack of Arabic speaking agents impacted the 
Bureau's ability to develop relationships with Arabic-speaking and 
Muslim communities within the United States?
    (c) How has the lack of Arabic speaking agents impacted the 
Bureau's ability to gather critical counterterrorism intelligence?
    20. You previously testified that the FBI can translate high-
priority counterintelligence material within 24 hours. Is this still 
the case, and what are the realistic prospects for this type of 
material to be translated in something approximating real time?
Afghanistan Opium Trade
    21. Earlier this year, the United Nations Office on Drugs and Crime 
(``UNODC'') reported that there has been a surge in opium cultivation 
in Afghanistan that is fueling the insurgency in that country. 
According to the report, opium production in Afghanistan has increased 
59 percent over last year and in the southern region where Taliban 
insurgents have intensified their attacks on Afghan government and U.S. 
forces, opium cultivation has increased by 162 percent. Given that the 
Bush Administration routinely describes the international narcotics 
trade as a national security issue, and that the production of opium 
has skyrocketed since the invasion of Afghanistan and removal of the 
Taliban, what does this mean for our national security at home and for 
the safety of our troops in Afghanistan?
Terrorist Watchlist
    22. You recently disclosed that the Terrorism Screening Database 
(``TSDB'') contains 491,000 records and that the FBI's review of the 
database to ensure the accuracy of these records will take years. The 
glaring errors in the FBI's Terrorist Watchlist--including the names of 
Members of Congress, infants and even nuns--clearly make the case for 
why this review is needed. These errors also suggest that any review of 
the TSDB must also include finding out how the bad information that is 
in this database got there in the first place.
    (a) What is the FBI doing to find out how bad data got into the 
TSDB and onto the terrorist watchlist?
    (b) Is there any procedure in place that requires the FBI to 
conduct an internal investigation whenever errors are detected in the 
TSDB? Should there be?
Cyber Security
    23. During the hearing, you testified that cyber crime is one of 
the FBI's top three priorities on the national security side. In late 
November, there were unconfirmed reports of a threatened attack on U.S. 
stock market and the Banking industry websites by a radical Muslim 
group. According to press reports, the attack would be in retaliation 
for the detention of Muslim prisoners at Guantanamo Bay.
    (a) What steps did the FBI take to respond to this threat?
    (b) What resources does the FBI currently have dedicated to U.S. 
cyber security?
Public Corruption
    24. In your testimony at the hearing, you called public corruption 
the FBI's top criminal investigative priority and you asserted that 
there has been an increase in the number of agents investigating public 
corruption cases and the number of cases investigated. However, a 
September 2005 report by the Department of Justice Office of the 
Inspector General found that, from 2000 to 2004, there was an overall 
reduction in public corruption matters handled by the FBI. The report 
also found declines in resources dedicated to investigating public 
corruption, in corruption cases initiated, and in cases forwarded to 
U.S. Attorney's Offices. It further found that some field offices were 
not giving public corruption sufficient emphasis and had scaled back 
their anti-corruption efforts.
    (a) What have you done since the Inspector General's report came 
out to ensure that combating corruption gets the resources and 
attention it needs?
    (b) Would the FBI benefit from additional resources to combat 
public corruption? If so, what types of resources would be the most 
helpful?
    25. In your written testimony, you cited the Phoenix Division's 
Lively Green investigation as an example of the FBI's commitment to, 
and success in, investigating public corruption. The Arizona Republic 
reported earlier this year that FBI agents working on the Lively Green 
investigation paid for a room for informants to stay in a presidential 
suite at the MGM Grand Hotel in Las Vegas. According to a disclosure 
made by prosecutors, the informants and suspects staying in the room 
hired prostitutes and sexually abused an unconscious prostitute. Soon 
after, FBI personnel recorded conversations which included detailed 
descriptions of the incident, and agents reviewed lewd photographs from 
the incident. FBI personnel failed to report the incident to 
prosecutors, who learned of it only many months later from an 
informant, and one agent was found to have made statements apparently 
suggesting that the informants get rid of the incriminating 
photographs. Although the Lively Green prosecutions went forward 
successfully, these cases were placed in jeopardy by this conduct.
    (a) What is the FBI doing to ensure that the problems that plagued 
the Lively Green investigation and other past investigations--agents 
covering for their informants' misconduct--do not happen again?
    (b) Are you satisfied with the steps that the FBI took to 
investigate and respond to the misconduct in the course of this 
operation?
FBI Computer System Failure
    26. According to several press reports, the FBI's National Instant 
Criminal Background Check System, which is used to screen gun buyers, 
crashed several times in November 2006--potentially allowing gun buyers 
to purchase firearms without being properly screened. According to the 
FBI, this background check system receives between 30,000 and 50,000 
background check request each day, so this is not an insignificant 
matter. I have three questions:
    (a) Has the FBI determined what caused the system to crash, and has 
this problem been fixed?
    (b) Does the FBI know how many gun sales were completed without 
background checks while the system was down?
    (c) What is the FBI doing to make sure that this problem never 
happens again?
Mike German/Whistleblowers
    27. According to the Office of the Special Counsel (``OSC''), the 
average number of whistleblowers who have filed complaints with the 
government has increased by 43 percent since September 11, 2001. Yet, 
sadly, the number of whistleblowers who have filed reprisal complaints 
with the OSC because their employers have retaliated against them for 
coming forward has also increased by 21 percent during the same time 
period. For example, former FBI special agent Michael German has said 
that his reputation and career were ruined after he reported concerns 
about misconduct on the Bureau's terrorism investigations to his 
superiors. What is the Bureau doing to protect the rights of 
whistleblowers within the FBI to come forward and disclose government 
fraud, waste and abuse?
    28. Many whistleblowers in the intelligence community are 
discouraged from coming forward because intelligence agencies are 
exempted from the Whistleblower Protection Act. Would you support 
legislation to extend whistleblower protections to national security 
employees?
Anthrax Investigation
    29. The Bureau's investigation into the 2001 anthrax attacks that 
killed 5, infected 17 others and terrified millions of Americans is now 
well into its fifth year. Many believe that the investigation has gone 
very cold and no arrests have been made in the case.
    (a) What is the current status of the anthrax investigation?
    (b) Do you expect that criminal charges will be brought in the case 
and if so, when?
    (c) You testified at the hearing that the FBI currently has 17 
agents and 10 postal inspectors assigned to the anthrax investigation. 
Has the number of personnel dedicated to the investigation changed? 
Will you consider increasing the number of agents and investigators 
dedicated to this investigation?
    (d) How much money has the FBI spent on the anthrax investigation 
to date?
    30. A frequent criticism of the anthrax investigation is that the 
FBI has made a number of incorrect assumptions about the source of the 
anthrax and refused to heed outside expert advice in the case. Will the 
Bureau be open to new theories about the case and more receptive to 
outside expertise and criticism going forward?
    31. You testified that the FBI has ``periodically'' provided 
briefings for the family members of the anthrax attacks. When was the 
Bureau's last briefing to victims and their family members? How often 
does the FBI provide these briefings?
Combined DNA Index System (CODIS)
    32. A recent investigation by USA Today uncovered nearly three 
dozen cases during the past five years in which investigators failed to 
pursue potential suspects whose DNA matched evidence found at crime 
scenes. (``Many DNA Matches Aren't Acted On, Nov. 21, 2006). According 
to USA Today:
    The unpursued matches had this in common: All were recorded as 
``hits'' by the CODIS system and added to the list of CODIS-aided 
investigations that the FBI makes public. Through September, the FBI 
counted 39,291 such matches since 1990. No one is certain how many of 
those matches resulted in arrests or convictions, however. In part 
that's because no law or regulation requires crime labs, the FBI or 
local law enforcement to follow through and determine what becomes of 
DNA matches after the CODIS system reports them to the police. Crime 
lab officials believe hundreds more matches have not been pursued by 
authorities. They say those matches might become evident only after a 
perpetrator is caught for a second time.
    (a) Does the FBI keep any data on how many CODIS matches are 
pursued by investigators?
    (b) Does the FBI keep any data on how many CODIS matches have 
helped solve crimes?
    33. The leader of the FBI's CODIS unit told USA Today that tracking 
the results of DNA matches would present a ``significant task'' that 
the FBI is not geared to undertake, and that accounting for CODIS 
matches should be the responsibility of local police and prosecutors 
who are given match information. Do you agree?
    34. Do you have any recommendations for improving accountability in 
this area? How can the federal government get an accurate measure of 
CODIS's real world value in solving crimes?
Corporate Fraud
    35. You testified during the hearing that white-collar criminal 
cases were one of the FBI's top three priorities on the criminal side. 
Recently, Deputy Attorney General McNulty issued new guidelines for 
corporate fraud investigations to address growing concern about the 
Department of Justice's investigation and prosecution of corporate 
fraud cases and, in particular, criticisms of the Department's policy--
embodied until recently in the so called ``Thompson Memorandum''--to 
request that corporate defendants produce attorney-client privileged 
and/or work product information in these investigations.
    (a) Does the FBI request or demand that corporate defendants turn 
over attorney-client privileged or work product information in its 
corporate fraud investigations? If so, would you describe such requests 
as routine in white collar fraud cases?
    (b) What will the FBI do to ensure that agents investigating 
corporate fraud cases conform their conduct to fit the standards set 
out in the new McNulty Memorandum?
Gardner-quinn Murder Investigation
    36. During the hearing, you testified that the FBI agent who 
published details of the Gardner-Quinn murder investigation in a 
Vermont newspaper is under investigation. What is the status of this 
investigation and has the agent involved been disciplined by the FBI?
 questions submitted by senator leahy pursuant to the march 27, 2007, 
       senate judiciary committee hearing regarding fbi oversight
    The FBI's responses to the below QFRs posed by Senator Leahy to 
Director Mueller following the 3/27/07 Senate Judiciary Committee 
hearing were to be provided to the Senate Judiciary Committee with the 
rest of the QFRs posed to the FBI following that hearing. Because we 
are not providing those responses here, we have ``grayed out'' these 
particular QFRs.
National Security Letters
    1. Despite the recent report by the Department of Justice Inspector 
General finding illegal and improper use of National Security Letters 
and so-called ``exigent letters,'' I understand that the FBI may still 
be using exigent letters. Is the FBI still using exigent letters and if 
so, why have you not stopped this practice?
    2. The Attorney General's guidelines require that the FBI use the 
least intrusive investigative tools to obtain the information that it 
needs. During the recent hearing that the Committee held on NSLs, 
Inspector General Glenn Fine testified that the least intrusive NSL are 
the ones seeking telephone records and that NSLs for financial records 
and for credit reports are more intrusive of Americans' privacy. During 
the hearing, you testified that you believed that NSLs seeking credit 
reports could be intrusive, but less so than those seeking telephone 
toll records. Does the FBI have a policy in place requiring that agents 
first use the least intrusive types of NSLs--such as NSLs seeking 
telephone toll records--when conducting investigations? If not, will 
you adopt such a policy to better safeguard Americans' privacy?
    3. I am also concerned about the kind of information that the FBI 
is seeking in its National Security Letters.
    (a) Is it true that most of the FBI's NSLs seeking telephone or 
Internet records under the Electronic Communications Privacy Act 
(``ECPA'') seek only subscriber identifying information? What 
percentage of these NSLs seek other transactional information, such as 
toll records or billing records?
    (b) With regard to NSLs that seek bank or other financial records 
under the Right to Financial Privacy Act, the Fair Credit Reporting Act 
and the National Security Act, what percentage of these NSLs seek 
detailed financial transaction information, such as bank account 
records and/or full credit reports?
    4. During the hearing, you testified that the information that the 
FBI improperly obtained through unlawful NSLs has been placed into the 
FBI's database. What steps have you taken to track all of this 
improperly obtained information, and have you removed it from all of 
the FBI's files and databases?
    5. Has any of the information improperly obtained through unlawful 
NSLs been used in any criminal cases or investigations and, if so, have 
you notified appropriate authorities at the Justice Department in order 
to make sure none of this information has been improperly used in our 
justice system?
    6. Do you believe that the FBI's failure to follow the law in 
obtaining NSLs may be exculpatory, or Giglio information, that needs to 
be disclosed if the information is used in court?
    7. The Judiciary Committee has received letters and briefings from 
FBI and Justice Department officials in the past, assuring us that NSLs 
were being used properly, and that all appropriate safeguards and legal 
authorities were being followed. For example, in a November 2005 letter 
to this Committee (attached), the Justice Department asserted 
emphatically that the FBI was not abusing the process for seeking NSLs, 
and that all NSL activity was accurately being reported to Congress as 
required by law. In light of the Inspector General's report, will you 
review those letters and briefings to see if anyone at the FBI or the 
Justice Department has misled this Committee about NSLs?
    8. According to the Inspector General's report, one of the major 
reasons that the FBI failed to report thousands of NSLs to Congress was 
because of a malfunction in a FBI's computer database. Apparently, this 
breakdown occurred in 2004, causing the loss of information about more 
than 8,000 NSL requests. What was the cause of this malfunction, and 
have you corrected it? Why did you fail to report this problem to 
Congress?
    9. You testified during the hearing that the FBI has revised its 
internal policy on NSLs and adopted the recommendations contained in 
the Inspector General's report. But, in 60 percent of the NSLs that the 
Inspector General reviewed, he found widespread failure on the part of 
the FBI to comply with its own internal control policies. Given this 
track record, how can you assure Congress that the new policies that 
you are implementing will prevent future abuses of NSLs, when the 
Bureau clearly failed to follow its own policies in the past?
    10. During the hearing, you testified that ``[t]he relevant 
standard established by the PATRIOT Act for the issuance of National 
Security Letters is unrelated to the problems identified by the 
Inspector General.'' Yet, given the broad scope of the abuses uncovered 
by the Inspector General's report, it appears that there is a need for 
additional checks and balances on the authority to issue NSLs. Do you 
believe that an independent check on the NSL process, such as approval 
of NSLs by a judge, a Justice Department attorney, or an outside review 
panel, would improve the NSL approval process and prevent future 
abuses?
Library Records
    11. I appreciate your March 30, 2007, letter responding to my 
question about how often the FBI has used NSLs to obtain records from 
libraries and educational institutions. In your letter, you state that 
the FBI's Office of General Counsel has maintained an informal list of 
the number of NSLs served on educational institutions or libraries; 
however, you also state that this list may not be complete or accurate. 
Given the importance of this issue to Americans' privacy and civil 
liberties, will the FBI agree to formally track the number of NSLs 
issued to libraries and educational institutions and periodically 
report this figure to Congress?
    12. During the hearing, you cited the Inspector General's Report on 
Section 215 of the PATRIOT Act, which found that the FBI rarely used 
this authority to obtain library records. However, I am concerned that 
the FBI is using other provisions in the PATRIOT Act to obtain this 
information, thereby circumventing the safeguards and reporting 
requirements of Section 215. For example in 2005, the FBI issued NSLs 
to four Connecticut libraries asking them to surrender ``all subscriber 
information, billing information and access logs of any person'' 
related to a specific library computer during a specific time period, 
pursuant to Section 505 of the PATRIOT Act. These NSLs also prohibited 
the librarians from disclosing the fact that they had received the NSLs 
or their contents--the so-called ``gag order'' under the PATRIOT Act.
    (a) Please describe the circumstances surrounding the FBI's 
decision to issue these National Security Letters.
    (b) Please identify all of the PATRIOT Act provisions that the FBI 
has used to obtain library records from libraries and educational 
institutions?
    (c) Is the FBI circumventing the requirements of Section 215 by 
relying on other provisions in the PATRIOT Act to obtain this 
information?
Arar/Watchlist
    13. I have asked before about Maher Arar, a Canadian citizen who 
when returning home from a vacation in 2002, was detained by federal 
agents at JFK Airport in New York City on suspicion of ties to 
terrorism, and was sent to Syria, where he was held for 10 months. 
After I pressed the Attorney General about the Arar case at a hearing 
in January, Senator Specter and I were finally granted a classified 
briefing. After that briefing, we wrote to request a Justice Department 
investigation into the matter and have learned that the Department's 
Office of Professional Responsibility is looking into the Department's 
legal decisions.
    (a) Is the FBI taking any steps to evaluate whether your agents and 
officials acted properly in the Arar matter, particularly with regard 
to the original decision to send him to Syria, rather than to Canada?
    (b) Given that a past OPR investigation of a politically sensitive 
matter, specifically the NSA's warrantless wiretapping program, appears 
to have been blocked, will you commit to cooperate with OPR's 
investigation of the Arar case?
    (c) What steps has the FBI taken to ensure that you do not 
participate in sending other people in the future to places where they 
will be tortured?
    14. Despite having been cleared of all terrorism allegations by 
Canada, Mr. Arar remains on a United States terror watch list. In fact, 
The Washington Post reported on Sunday that our watch lists keep 
growing, with the Terrorist Identities Datamart Environment 
(``TIDE'')--the master list from which other lists, like the No Fly 
list, are taken--now numbering about 435,000 people.
    (a) Doesn't such a large and constantly growing list actually make 
it harder for the FBI and others to use the information? Wouldn't the 
FBI and other agencies be able to do much more to protect us with a 
more controlled list, focused on serious and proven threats?
    (b) The Washington Post article also noted the difficulty that 
people on the list, or with names similar to people on the list, have 
in getting off of government lists--which restrict their travel and 
their lives. The Government Accountability Office issued a report last 
year setting out some of the failures throughout the government in 
allowing individuals effective redress if they are wrongly placed on 
these lists. In light of the Arar situation, Senator Specter and I 
asked the Government Accountability Office to update their review. What 
steps has the FBI taken to allow individuals who may be wrongly on 
watch lists to challenge and correct those designations?
Sentinel
    15. Now a year into the Bureau's Sentinel computer upgrade program, 
I remain concerned about the prospect of this program and its 
ballooning costs to American taxpayers. Earlier this month, the FBI 
informed the Committee that it had encountered unexpected problems with 
the deployment of Phase I of the Sentinel program that would delay the 
program. Even more troubling, the FBI could not tell Committee staff 
how long it would take to remedy these problems, or how the delay would 
impact the overall schedule for Sentinel. What is the current status of 
the Sentinel program and do you anticipate that there will be 
additional delays in deploying the program or costs overruns? What 
impact have the delays with Sentinel--and Trilogy before it--had on the 
Bureau's ability to fulfill its core mission?
Civil Rights Cold Cases
    16. In February 2006, the FBI established a nationwide initiative 
to re-examine civil rights era cold cases. At a press conference on 
February 27th, the FBI released a press statement announcing that 
although 100 cold cases have been referred to the Bureau, the FBI has 
prioritized only a dozen. I applaud the effort to reexamine these 
cases, but why has the FBI only prioritized a mere handful of civil 
rights era cold cases? How many agents, analysts, and other resources 
has the FBI committed towards this important effort?
    17. Earlier this year, I joined Senator Dodd in re-introducing the 
Emmett Till Unsolved Civil Rights Crime Act. This bill creates 
permanent unsolved civil rights crimes units within the FBI and the 
Civil Rights Division of the Justice Department to investigate and 
prosecute these crimes. This bill will also give law enforcement the 
resources to ensure that justice is served. As a former prosecutor, I 
strongly believe law enforcement should have the necessary tools to 
aggressively seek those who have committed these crimes, regardless of 
the time that has passed. Would you support the Emmett Till bill? Do 
you believe this bill gives the FBI the resources needed to thoroughly 
investigate unsolved civil rights murders?
Lost Laptops/Data Security
    18. In February, the Inspector General for the Department of 
Justice released another troubling report finding that the FBI lost 160 
laptop computers--including at least ten computers that contained 
classified information and one that contained sensitive personal 
information about FBI personnel--during a 44-month period. Even more 
troubling, the report also found that the FBI could not even account 
for whether 51 other computers, including seven computers that were 
assigned to the Bureau's counterintelligence and counterterrorism 
divisions, might contain classified or sensitive data. What is the 
Bureau doing to address its problem of lost laptops and lax data 
security?
    19. Earlier this year, Senator Specter and I reintroduced our 
Personal Data Privacy and Security Act, which would, among other 
things, require federal agencies to give notice to the individuals 
whose data is lost or stolen, when a data breach occurs. Did the FBI 
notify the individuals whose sensitive personal information was lost in 
the case of the missing laptops? Would you support this legislation?
    20. After the VA lost a laptop containing sensitive personal 
information about millions of veterans and active duty personnel, 
Secretary Nicholson instituted a new policy requiring that all of the 
VA's computers contain encryption technology to prevent the 
unauthorized disclosure of sensitive information. Will you make a 
similar pledge to use encryption technology for all of the Bureau's 
computers?
DNA Sampling
    21. Pursuant to a little noticed provision in the Violence Against 
Women Act reauthorization bill, the Department of Justice is currently 
developing new guidelines that would greatly expand the Government's 
ability to collect DNA samples--which reveal the most sensitive genetic 
information about an individual--from most individuals who are arrested 
or detained by federal authorities and to store this sensitive 
biological information in a federal data base known as the National DNA 
Index System. This new policy will allow the Federal Government to 
collect DNA samples from hundreds of thousands of illegal immigrants 
who may be detained by federal authorities and from individuals who may 
be arrested--in essence, making DNA collection as common as 
fingerprinting. What privacy protections are in place under the 
Department's new guidelines to ensure that sensitive DNA data contained 
in the National DNA Index System will not be misused or improperly 
disclosed by the FBI or other federal and state agencies?
    22. I am also concerned about this new policy because the new DNA 
evidence collected by the Government will add to the already notorious 
backlog at the Bureau's laboratory. According to press reports, the FBI 
acknowledges that this new policy will result in an increase of as many 
as 1 million additional DNA samples a year. Is the Bureau's laboratory 
equipped to handle this additional workload? What steps are you taking 
to make sure that the FBI's laboratory can keep up with the demand for 
DNA samples?
Improper Reporting of Terrorism Statistics
    23. The Department of Justice Inspector General found in another 
recent report that the FBI failed to accurately report eight of the ten 
terrorism statistics that it reviewed for this report--that is an 80 
percent failure rate. Among other things, the FBI overstated the number 
of terrorism-related convictions for 2004, because it included cases 
where no terrorism link was actually found. This is no simple matter--
the Congress relies upon these statistics to conduct oversight and to 
make funding and operational decisions regarding the Bureau. What steps 
have you taken to address the problems with reporting of terrorism 
statistics at the FBI?
Staffing
    24. I also remain concerned about staffing at the Bureau. In 
January, your Deputy, John Pistole, told the Senate Intelligence 
Committee that the FBI expects to lose 400 agents and 400 intelligence 
analysts this year, due to retirement or attrition. Mr. Pistole also 
stated that approximately 20 percent (370) of the FBI's intelligence 
analysts have less than a year of experience with the Bureau. I cannot 
help but worry that the Bureau will not have the staffing and expertise 
that it needs to carry out its counterterrorism and counterintelligence 
mission, given these figures on staffing. What are you doing to address 
the shortage in intelligence analysts and agents? How many agents and 
analysts do you expect to hire by the end of 2007?
FOIA
    25. I was disappointed to learn that the FBI has not met several of 
its goals to improve FOIA processing under the President's Executive 
Order 13392, including the important goal to complete all FOIA requests 
that are more than two years old by August 2006. What is the current 
status of the FBI's FOIA backlog?
MI5
    26. After the horrific attacks of September 11th, I worked very 
hard with others in Congress to give the FBI the tools that it needed 
to combat terrorism and carry out its domestic intelligence functions. 
Given what we have learned about the widespread misuse of National 
Security Letters and chronic staffing problems in the Bureau's 
counterterrorism and counterintelligence offices, some are calling for 
the Congress to put the Bureau's domestic intelligence operations in a 
new MI5-styled domestic intelligence agency. Do you believe that 
Congress should create a domestic intelligence agency to carry out the 
Nation's domestic counterterrorism activities?
  political landscape ``informational briefings'' by white house for 
                      senior government officials
    Question. A number of recent reports, including Tuesday's (April 
24, 2007) Los Angeles Times and today's Washington Post, suggest that 
White House staff, including Ken Mehlman, Scott Jennings and perhaps 
others, have provided what a White House spokesman calls 
``informational briefings to appointees throughout the federal 
government about the political landscape.''
    Have appointees or employees at the United States Department of 
Justice received such ``informational briefings''?
    Answer. The Department queried components to determine whether any 
political appointees attended or were aware of any employees within the 
components attended a briefing with White House officials described in 
the inquiry. The Department's Office of Information and Privacy and the 
Executive Secretariat also conducted searches of the electronic and 
paper files.
    The Department's information indicates that employees attended 
briefings at the White House's Eisenhower Executive Office Building and 
in one instance, at the U.S. Department of Agriculture. The 
Department's records do not indicate whether all of the meetings 
actually included a political briefing regarding elections or 
candidates.
    Question. Have appointees or employees at the United States 
Department of Justice received briefings from White House staff that 
reviewed polling data?
    Answer. The Department's search efforts did not reveal information 
indicating that briefings of the type described in the inquiry were 
held at the Department of Justice. The Department's information 
indicates that DOJ employees attended briefings at the White House's 
Eisenhower Executive Office Building and in one instance, at the U.S. 
Department of Agriculture. The Department's records do not indicate 
whether all of the meetings actually included a political briefing 
regarding elections or candidates.
    Question. Have appointees or employees at the United States 
Department of Justice received briefings that mentioned congressional 
election or reelection campaigns?
    Answer. The Department's information indicates that DOJ employees 
attended briefings at the White House's Eisenhower Executive Office 
Building and in one instance, at the U.S. Department of Agriculture. 
The Department's records do not indicate whether all of the meetings 
included a political briefing regarding elections or candidates.
    Question. According to a front page story in today's Washington 
Post, before the last midterm election, White House staff conducted 20 
such briefings in at least 15 government agencies on the electoral 
prospects of Republican and Democratic candidates. If any such 
briefings have occurred at the Department of Justice, please provide me 
with the specifics on when they occurred, who attended, what was shared 
and said, and all documents reflecting such matters in the custody, 
possession or control of the Department.
    Answer. The Department's search efforts did not reveal information 
indicating that briefings of the type described in the inquiry were 
held at the Department of Justice. The Department's information 
indicates that DOJ employees attended briefings at the White House's 
Eisenhower Executive Office Building and in one instance, at the U.S. 
Department of Agriculture. The Department's records do not indicate 
whether all of the meetings included a political briefing regarding 
elections or candidates.
                                 ______
                                 
            Questions Submitted By Senator Pete V. Domenici
                indian country methamphetamine problems
    Question. As you know, methamphetamine is a growing problem around 
the country, second only to alcohol and marijuana as the drug used most 
frequently in many Western and Midwestern states. Meth has become an 
epidemic because of its low cost and ready availability. Law 
enforcement officers continue to raid record numbers of clandestine 
labs. Despite these efforts, meth use in communities continues to 
increase. These labs present a clear and present danger to the citizens 
of my state and to people across the country.
    Congress has passed the Combat Meth Act to provide valuable new 
resources and tools to states, local law enforcement and prosecutors to 
combat the production and distribution of meth while at the same time 
educating our communities about meth. The DEA is requesting $29.2 
million for its Southwest Border and Methamphetamine Enforcement 
Initiative.
    I'm told by experts in my home state of New Mexico that many of our 
meth problems are the result of the drug being brought into the United 
States from Mexico. I have also been told that the decrease in illegal 
importation of Meth is directly correlated to the increase in 
clandestine labs. I am very concerned about meth production and use on 
the Native American lands in New Mexico. Knowing the FBI's jurisdiction 
in Indian Country, has the FBI seen an increase in violent crimes and 
felonies on the Navajo Nation and in the four-corners area of New 
Mexico that are meth related?
    Answer. The FBI has noted increases in the use of methamphetamine 
and in methamphetamine-related violence in this area over the past four 
years, and in some locations the increase in violence has included an 
increase in the number of assaults on law enforcement officers by 
methamphetamine traffickers and users. While the overall level of 
violent crime in Indian Country (IC) has remained relatively constant 
from 2004 to the present (based on the number of pending cases, cases 
opened, arrests, indictments, informations, and convictions for murder, 
assault, adult rape, and child physical abuse), the incidence of IC 
violent crime remains high.
    It is the FBI's understanding that research by the Office of 
National Drug Control Policy indicates a reduction in the number of 
methamphetamine laboratories in the United States, with much of the 
methamphetamine used in the United States being manufactured in Mexico. 
These drugs are often trafficked through IC for sale in the United 
States. These findings are consistent with the FBI's analysis and 
experience and, in an effort to address the surge in IC methamphetamine 
trafficking, the FBI has continued to expand its STTF initiative. 
Sixteen STTFs, comprised of Federal, tribal, state, and local law 
enforcement officers, operate throughout the IC. The interagency 
partnerships established in these task forces benefit IC law 
enforcement by leveraging resources. On many Native American Indian 
reservations, the STTFs provide the only effective narcotics 
investigation capabilities. Initial data for fiscal year 2007, indicate 
that STTFs obtained 69 indictments, arrested and/or located 96 
subjects, obtained 86 convictions, and disrupted two drug trafficking 
organizations.
    Question. What other trends are you seeing on Tribal Lands relating 
to felony criminal activity that is under the purview of the FBI's 
jurisdiction?
    Answer. FBI SAs assigned to IC continue to report high levels of 
violent crime on Native American reservations throughout the United 
States, including a marked increase in the number of IC child sexual 
assault cases in fiscal year 2007 as compared with fiscal year 2005 and 
2006. The number of child sexual assault cases opened in fiscal year 
2007 outnumbered those for fiscal year 2006 by 7 percent.
    In order to better equip Federal and tribal officials investigating 
IC child sexual assault allegations, the FBI has developed a course 
focused on forensic interviews of children in IC cases. This training 
was offered regionally on three occasions in fiscal year 2007 and will 
be offered again in fiscal year 2008. In addition, the FBI has worked 
to create a state-of-the-art child advocacy center on the Crow 
Reservation in Montana. This center, which opened on 4/24/07, provides 
child-appropriate interviewing services to IC investigators on the Crow 
and Northern Cheyenne Reservations. (This valuable resource has also 
been used by state officials investigating the alleged sexual abuse of 
non-Indian children.)
    Compounding the problems associated with high violent crime rates 
and drug trafficking in IC are increasing problems related to IC street 
gang structures, many of which engage in drug trafficking to enhance 
their gang influence. The majority of large Native American 
reservations suffer from some level of gang influence, ranging from 
``emerging'' to established street gang structures engaged in organized 
criminal activity. In the past, Native American gangs engaged primarily 
in property-based crimes such as graffiti and vandalism. IC law 
enforcement officials are particularly concerned about the movement 
toward more violent criminal acts, including sexual assaults, gang 
rapes, home invasions, drive-by shootings, beatings, and elder abuse. 
During a 2006 assessment of gang activity on the rural Crow Indian 
Reservation in Montana, teenage gang members told FBI SAs of impending 
drive-by shootings on that reservation and acknowledged ``jumping in'' 
(severely beating) and ``sexing in'' (requiring sexual activity from) 
prospective female gang members.
    The emergence of Native American gangs in IC has largely been 
attributed to the strained Native American social environment and 
pervasive media influences. Native American gangs often assume 
characteristics of urban street gangs, using common signs, symbols, 
names, slang, and attire. These gangs have been significantly 
influenced by members who were previously incarcerated and involved in 
prison gang cultures. As incarcerated individuals have been released 
from prison to their reservation communities, they have enhanced their 
influence by promoting their prison gang affiliations, fostering the 
growth of criminal gang cultures in IC. In addition to prison gang 
influences, IC law enforcement officials have noted the emergence of 
female Native American gangs, members of which have escalated their 
violent behavior in order to prove they are as violent and anti-social 
as their male counterparts.
    The FBI sponsors training for all levels of IC law enforcement, 
including approximately 25 classes per year for 1,200 Federal, state, 
local, and tribal law enforcement officials. This training addresses 
Native American gangs, crime scene processing, child abuse 
investigations, forensic interviewing of children, homicide 
investigations, interviewing and interrogation, officer safety and 
survival, crisis negotiation, and Indian Gaming.
                             internet crime
    Question. The Albuquerque Journal reported this week that over the 
past two years, internet crime in my home state of New Mexico has 
increased by over 235 percent, while internet crime nationwide has 
remained at the same levels. This news story went on to state that the 
technology boom in rural America may be the cause of increased internet 
criminal activity in New Mexico. Electronic criminal activity is a 
serious issue that appears to be difficult to investigate and 
prosecute.
    Has the FBI made any inroads into cracking down on this type of 
criminal activity?
    Answer. The series of international searches, arrests, and 
confessions accomplished in the past several years through Operation 
Fast Link and Operation Site Down have enabled the FBI to make 
significant progress in addressing IP Internet criminal activity. The 
FBI is also focusing on the counterfeiting of business software and 
hardware products, which has significant international impact. The FBI 
will continue to work with industry, state and local law enforcement 
authorities, and our foreign law enforcement partners to ensure that 
our IP enforcement measures are as effective as possible and address 
the problem at all levels.
    Question. What is the FBI doing to assist local law enforcement 
with investigations related to internet crime?
    Answer. The FBI's approach to Internet crime includes more than 75 
cyber task forces, which include state and local law enforcement and 
leverage the FBI's ability to provide support and guidance in support 
of their local investigations. These task forces supplement the FBI's 
investigative efforts by supporting not only IP rights and Internet 
crime investigations, but also computer intrusion and ``Innocent 
Images'' investigations.
    In addition, the Internet Crime Complaint Center (IC3), which is a 
project jointly run by the FBI and the National White Collar Crime 
Center, receives over 22,000 Internet crime complaints per month from 
consumers and businesses. All complaints received by IC3 are accessible 
to Federal, state, and local law enforcement to support active 
investigations, trend analysis, and public outreach and awareness 
efforts. During 2006, IC3 referred 86,279 complaints of crime to 
Federal, state, and local law enforcement agencies around the country 
for further consideration. The vast majority of these cases involved 
fraud and a financial loss on the part of the complainant.

                          SUBCOMMITTEE RECESS

    Senator Mikulski. So, this subcommittee stands in recess 
until 10 a.m., Thursday, May 3, when we will take testimony 
from the Equal Employment Opportunity Commission.
    Mr. Mueller. Thank you, Madam Chairman, and thank you for 
letting me out of here so I can attend to the next function I 
have to make.
    Thank you.
    [Whereupon, at 11:43 a.m., Thursday, April 26, the 
subcommittee was recessed, to reconvene at 10 a.m., Thursday, 
May 3.]




















  COMMERCE, JUSTICE, SCIENCE, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2008

                              ----------                              


                         THURSDAY, MAY 3, 2007

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:03 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Barbara A. Mikulski (chairman) 
presiding.
    Present: Senators Mikulski, Shelby, and Alexander.

                EQUAL EMPLOYMENT OPPORTUNITY COMMISSION

STATEMENT OF NAOMI CHURCHILL EARP, CHAIR

                STATEMENT OF SENATOR BARBARA A. MIKULSKI

    Senator Mikulski. Good morning. The Subcommittee on 
Commerce, Justice, Science of the Appropriations Committee will 
come to order. As we said in the beginning of the year, our 
themes are innovation, security, and accountability.
    This morning, this subcommittee will focus on an agency who 
has one of probably the most important missions within the 
Government in addition to security, which is the enforcement of 
our laws against employment discrimination. This hearing will 
be an oversight hearing as related to what is needed to be sure 
the agency is able to fulfill its mission.
    I would have never dreamed many years ago that I would be 
able to be here as the appropriator for the Equal Employment 
Opportunity Commission (EEOC). It would have been a dream well 
beyond my wildest imagination. Over 40 years ago, I was a young 
social worker who had heard the call of a gifted President 
named Jack Kennedy asking not what you can do for your country 
but what your country can do for you, and responded to that 
call by fighting the war on poverty and being very active in my 
own community in the area of civil rights.
    Baltimore was a tough town. It had a northern economy but a 
southern social structure. It was a segregated town and as part 
of great leadership, the home of where the NAACP is 
headquartered, the home that gave us Thurgood Marshall, the 
Mitchell family, like Juanita and of course, Mr. Mitchell, the 
101st Senator himself. We did marches and we sang, but we knew 
that marches and singing didn't always open the doors. They 
were to get the attention to open the doors.
    So when this Government created the Equal Employment 
Opportunity Commission, we thought it would be a one-stop shop 
that people within this country could turn to redress any 
grievance they had if doors were being slammed against them. 
That's what the job of the EEOC Commission is, to make sure 
that doors of employment are never ever slammed shut, that by 
vigorously enforcing the discrimination laws on race, religion, 
gender, and national origin, we would show that America 
believed that we are truly all created equal.
    But we are very concerned about what's happened over at the 
Equal Employment Opportunity Commission over the years. It 
seems not to have been able to fulfill its mission and we are 
concerned about three issues: management, morale, and money. Is 
it the lack of resources that are creating the problem? But by 
any index of objective analysis, it seems that the EEOC really 
has problems and is in disarray.
    We are very concerned about the fact that over years, 
management has been inconsistent and imperial. Madam Chair, we 
understand you've been on the job for 6 months, so we're 
looking for recommendations and results and how that might be 
tied to resources. If it's not resource-driven but leadership 
driven, then I want to hear what your vision is because we're 
very concerned about how we can fix it so that people can have 
confidence in the process. We believe that we are a Nation of 
law, that our law guarantees equal opportunity in employment 
and that we have an agency that you can turn to if you feel 
that you have discriminated against.
    But we're concerned. Last year, EEOC received 76,000 
complaints that needed to be investigated on top of a backlog--
the 34,000 backlog cases from the year before. Backlogs are an 
obsession with us because where there is a backlog, there is 
really a question of being able to enforce the laws. We're 
concerned that backlogs are on the rise and that the issues are 
not being addressed.
    Despite rising complaints and increased backlogs, EEOC has 
downsized its agency, contracted out to a customer service call 
center, which had very few people and seemed to have very 
little training. So we're going to want to ask about this call 
center. When you call, do you get an answer? Or are you put on 
hold and with the backlog, there's another hold you're put on?
    What we want to be able to do today is focus on two things: 
oversight and accountability and how that leads to advocacy. My 
duty as an appropriator is to make sure that American taxpayer 
dollars are used responsibly but at the same time, that 
accomplishes mission and purpose. So we've been concerned and 
I'll be blunt, Ms. Earp, we know you've had this job 6 months 
so when you hear our frustration, it's not targeted at you 
personally, so we want you to know that. We know that front 
line staff has been cut. We know that work has been privatized 
without really ensuring quality and oversight.
    The district offices were reduced from 23 to 15 but what is 
the rationale? We know that there has been a reduction in 
attorneys. Was this about money? Was this about poor 
management? And it's had a terrible effect on morale. The 
agency has been reduced by 575. Has this been downsizing and 
downgrading? Or it is right sizing? We need to know and we know 
that there hasn't been a look at the agency in a number of 
years and that's why we want to start this ball rolling.
    As I said, we're advocates here, of civil rights. These men 
represent the New South. They were generationally parallel. We 
came out of a lot of turmoil and a lot of tumult but committed 
in our lives and our public service to do that. Senator Shelby, 
a champion on these issues. Senator Alexander, a Governor, a 
Secretary of Education, now fighting also to make sure that 
education is one of the key tools of an empowerment agenda and 
the greatest equal opportunity is the right to an equal 
education and to a good education.
    So we're champions here of civil rights and this is why we 
want this agency, under our stewardship, to be one of the best 
in our portfolio. So we want to hear from you today on how to 
do it. You know, we've been through restructuring plans. We 
don't know what that meant. We saw that positions were reduced, 
as I said, from 23 to 15. Was that a good idea? It seemed that 
from what we heard from the civil rights community was that it 
was not a good idea.
    With the call center, we understand that it was contracted 
out. They only get 7 days of training on civil rights law, that 
you're not getting the calls that you expected and there seems 
to be a tremendous lack of communication between the EEOC and 
the call center.
    Then, in my own State, there was the closing of a district 
office, which was the hallmark of fairness in hearing 
complaints for Federal employees. There are 117,000 Federal 
employees in the State, and not because we're a big 
bureaucracy. We're the home to the National Institutes of 
Health--13,000 people. We're the home to the Census Bureau--
4,000 people. We are the home to so many other Federal 
agencies--yes, as well as our defense, which has its own track.
    So you see, what we want to do is we--we can talk about 
downsizing and right sizing but what we want to talk about is 
the right track. We are committed to the mission and goals that 
were established for the EEOC. So we want to take a look at the 
management issues, the morale issues and the money issues and 
we look forward to hearing your recommendations because we are 
results driven but know, just as there has been a backlog, 
there is also a backlog of frustration.
    But I'm going to be clear. It is not at you personally. 
Senator Shelby.

                 STATEMENT OF SENATOR RICHARD C. SHELBY

    Senator Shelby. Thank you, Senator, Chairman Mikulski, 
Madam Chairman. We thank you for joining us here today to 
discuss this. The chairman has already said the Equal 
Employment Opportunity Commission 2008 budget request.
    The EEOC has an important mission as it provides assistance 
to those who have faced discrimination in the workplace. This 
is accomplished through investigations, mediation, legal action 
and by providing education to businesses. The EEOC request for 
2008 is $327.7 million, which is approximately a $1 million 
decrease below the 2007 joint resolution funding level.
    I know that Chairman Mikulski has serious concerns 
regarding the EEOC's performance, particularly with the 
Commission's direction and disregard for congressional 
oversight. I agree with her and know that you are new to your 
chairmanship and inherited many of the problems from your 
predecessor. I believe this has had an immeasurable impact on 
the EEOC's ability to carry out its mission.
    It's come to my attention that the EEOC has decided to cut 
a large amount of its allocation from the State and local 
sector. I'm curious as to why this route has been taken because 
the local offices, I believe, are vital to the mission of EEOC. 
I have heard of the great accomplishments of the new Mobile 
office in my State, especially given its large jurisdiction 
covering the gulf coast regions of Mississippi, Alabama, and 
the Florida Panhandle. I want to work with you to ensure that 
the State and local offices get the support that they need to 
do their job.
    Based on my review of your request, combined with the 
likely fiscal constraints of this subcommittee, we will need 
your assistance, Madam Chairman, as we face tough funding 
decisions regarding the allocation of resources in your budget. 
This subcommittee and the Commission share the difficult task 
of targeting these limited resources in a manner that 
safeguards taxpayers' dollars while enabling the mission of 
EEOC to be carried forward.
    Madam Chairman, we look forward to your testimony and we 
look forward to working with you during the 2008 budget process 
to ensure that you have, as the chairman, have the necessary 
resources to carry out the wide and varied missions of the 
EEOC. I look forward to working with you and Chairman Mikulski 
and Senator Alexander and others to make sure that you have the 
requisite funding and we hope and I believe you will go in the 
right direction. Thank you.
    Senator Mikulski. Thank you very much. Senator Alexander, 
did you wish to make a comment?
    Senator Alexander. No thank you, Madam Chairman. I have 
some questions but I'll save them for later.
    Senator Mikulski. Thank you. Ms. Earp, please proceed.

                    SUMMARY STATEMENT OF NAOMI EARP

    Ms. Earp. Thank you. Good morning, Madam Chair, members of 
the subcommittee. Thank you for inviting me to testify today on 
behalf of the Equal Employment Opportunity Commission in 
support of the President's 2008 budget request for $327.7 
million.
    As you've already indicated, I became the 13th Chair of the 
Equal Employment Opportunity Commission just this last fall. It 
is a distinct pleasure to appear before you to discuss the 
needs of EEOC for fiscal year 2008 as represented in the 
President's budget. I want to thank you, Madam Chair, for your 
past support and thank the members of the subcommittee for its 
support and your anticipated future support.
    EEOC's vision is for a strong and prosperous Nation secure 
through fair and inclusive workplaces. We strive to ensure 
equality of opportunity in the workplace by enforcing the 
Federal laws prohibiting employment discrimination. We seek to 
maintain the Commission's reach by continuing proactive 
measures to prevent discrimination while resolving claims and 
strategically focusing our enforcement and litigation programs.
    I've submitted for the record, a statement that highlights 
aspects of our budget but I want to spend just a few minutes 
touching on some of the points that are in the written 
statement.
    First of all, our budget request includes $160.3 million 
for administrative charge processing. In fiscal year 2006, the 
EEOC received almost 76,000 private sector charges. This was a 
slight increase over 2005. We resolved just over 74,000 private 
sector resolutions and recovered $229.8 million in monetary 
benefits for victims of discrimination. We ended the fiscal 
year with a charge inventory of almost 40,000 charges. We 
acknowledge that our charge----
    Senator Mikulski. Excuse me. Does charge inventory mean 
backlog?
    Ms. Earp. Essentially.
    Senator Mikulski. Okay.
    Ms. Earp. We acknowledge that the inventory is growing. 
EEOC also has responsibility for hearings and appeals of 
complaints filed by Federal employees. We received over 14,000 
requests for hearings or appeals from Federal sector employees. 
Our budget request includes $47.5 million for Federal sector 
programs.
    The litigation program is an important part of overall 
enforcement. During 2006, our litigation program filed 371 new 
lawsuits on the merits and resolved 418, resulting in monetary 
benefits of $44.3 million. The 2008 budget request includes 
almost $3 million in direct support of the litigation program.
    That would bring our total litigation budget to just a 
little under $57 million.
    A strong litigation program provides an incentive for the 
early resolution of charges during the administrative 
enforcement process.
    Regarding mediation, our budget request includes $22.3 
million. In fiscal year 2006, 8,200 charges were resolved 
through mediation. The mediation program is highly successful 
and has been since its inception.
    Madam Chair, you've noted a number of issues that you are 
concerned about but I would like to point out that the 
mediation program is one of the best, most successful efforts 
EEOC currently has underway. An independent survey found that 
96 percent of employers and 91 percent of charging parties 
would use our mediation program again if they were offered it.
    It's clear the best way to combat employment discrimination 
is to prevent it from happening in the first place. We continue 
to meet with advocacy and community groups, employer groups, 
the legal community, students, educational organizations, 
unions and members of the general public. We share with them 
employment trends. We assess needs and we offer advice and 
assistance. In fiscal year 2006, we conducted 5,634 outreach 
events, reaching nearly 300,000 people. Approximately 4 percent 
of the budget is devoted to outreach activities. We're asking 
$12.6 million.
    Regarding the FEPA, Senator Shelby, that you mentioned, I 
would note that we are joined in our enforcement efforts, with 
96 State and local partners generally called the Fair 
Employment Practice Agencies (FEPA). The budget request for 
FEPAs for 2008 is $28 million and I would just note at this 
time that EEOC has no involvement and has had no involvement in 
cutting any amount from the President's budget or otherwise for 
our State and local partners.
    The EEOC, like all agencies today, faces many challenges. 
We are first and foremost an enforcement agency and we must 
provide the quality and integrity of enforcement efforts that 
the public expects and deserves. Approximately 80 percent of 
our budget has been consistently devoted to relatively fixed 
expenses, primarily payroll and rent. An additional 9 to 10 
percent is dedicated to our partners in the State and local 
fair employment practice agencies. The fixed costs of EEOC 
leave us with little discretion in terms of shifting resources 
to be able to respond to emerging or pressing needs. We 
constantly look for ways to maximize the return on resources 
and we look for better ways to align those resources with the 
mission.
    In August 2002, the National Academy of Public 
Administration (NAPA) conducted a study of our structure and 
our program delivery. In February 2003, the Academy released 
its findings. Most significantly, they recommended that we 
establish a National Contact Center and that we align or 
realign our field offices and that we restructure our 
headquarters. We have acted on the first two of these 
recommendations and we are just beginning work on the third. I 
look forward to working with the subcommittee, getting the 
subcommittee's ideas about reorganizing, restructuring our 
headquarters office.
    I want to make just a couple of points about the National 
Contact Center (NCC). It began operation in March 2005 on a 2-
year pilot basis. It's based in Lawrence, Kansas. The pilot has 
been extended for 1 additional year. While admitting that the 
National Contact Center got off to a rough start, we had some 
things to smooth out. The NCC allows 24-hour access to the 
Equal Employment Opportunity Commission. It saves our 
investigators and our attorneys from having to answer routine 
calls. Since it began taking calls, the National Contact Center 
has received over 1 million contacts from the public. This 
includes telephone calls, e-mails, faxes.
    Our initial focus was on training, monitoring for quality, 
accuracy and the interpersonal skills of the people who would 
answer the phone for us. As these have developed, we are now 
prioritizing actions to increase call volume and to better 
integrate the National Contact Center with EEOC procedures and 
practices. Results are reflected in the most recently available 
report, which shows that in March of this year, the National 
Contact Center received over 65,000 contacts. At this rate, we 
project that the contact center will handle 700,000 contacts 
for us this year alone.
    A recent report by NAPA found that EEOC is aggressively 
addressing issues and the implementation and follow-up is 
noteworthy regarding the contact center. The NAPA Panel also 
found that the cost of moving the contact center into EEOC 
would substantially exceed the current arrangement and that an 
in-house run EEOC call center would cost about $8 million the 
first year and almost $5 million every year after that.
    Regarding repositioning, I would just simply say, again 
this was a NAPA recommendation that we believe is a good idea 
as we seek to realign our resources with our organizational 
structure. While we are concerned about the rising inventory 
and our ability to timely investigate charges and provide 
efficient customer service, we are confident that strides are 
being made, that improvements are underway and that we can 
manage within the budget the President requests for 2008.

                           PREPARED STATEMENT

    In conclusion, Madam Chair, the EEOC cannot fight 
discrimination in the 21st century with the same methods that 
we've used in the past and we thank you for your support.
    [The statement follows:]
               Prepared Statement of Naomi Churchill Earp
    Good morning Madam Chair and Members of the Subcommittee. Thank you 
for inviting me to testify today on behalf of the Equal Employment 
Opportunity Commission (EEOC) in support of the President's fiscal year 
2008 budget request of $327.7 million. As you may know I became the 
thirteenth Chair of the Equal Employment Opportunity Commission in 
September 2006. It is a distinct pleasure to appear before you to 
discuss the needs of the EEOC for fiscal year 2008 as represented in 
the President's request. I want to thank you for your past and 
anticipated future support of the EEOC.
    Our vision is for a strong and prosperous nation secured through 
fair and inclusive workplaces. We strive to ensure equality of 
opportunity in the workplace by enforcing the federal laws prohibiting 
employment discrimination. Our newly implemented strategic plan builds 
upon what the agency has accomplished to improve its operations. It 
seeks to maintain the Commission's reach by continuing proactive 
measures to prevent discrimination; resolving claims of discrimination 
more proficiently; continuing alternative dispute resolution; 
developing a more strategic focus in our enforcement, litigation and 
federal programs; and renewing a strategy to eradicate race and color 
discrimination while maintaining our internal operations.
                 eeoc's fiscal year 2008 budget request
    EEOC's fiscal year 2008 budget request is for $327,748,000. Let me 
highlight some components of our budget, approval of which will be 
essential to meet the demands inherent to the fulfillment of our 
mission in the 21st century. I am also submitting for the record a copy 
of EEOC's Fiscal Year 2006 Performance and Accountability Report. The 
report provides in greater detail the successes of our performance and 
activities for the past year.
    Staffing and Enforcement Workload.--Our budget request includes 
$160.3 million for administrative charge processing. Our employees are 
passionate about, and dedicated to, their work and produce a 
substantial body of work. In fiscal year 2006 the EEOC received 75,768 
private sector charges, a slight increase over 2005. We had 74,308 
private sector resolutions and recovered $229.8 million in monetary 
benefits that went directly to the victims of discrimination.
    In fiscal year 2006 our average processing time per private sector 
charge was 193 days, a 12 percent increase over our 171 day average in 
fiscal year 2005. Our end of year inventory of private sector charges 
was 39,946, a 19 percent increase over our fiscal year 2005 inventory. 
We project an inventory of in excess of 54,000 by the end of fiscal 
year 2007 and in excess of 67,000 by the end fiscal year 2008. We will 
address this issue of rising average processing times within existing 
resources, using an FTE level of 2,381, the same as fiscal year 2007 
and an increase over our staff level at the end of fiscal year 2006. As 
we staff up to our budgeted levels, we expect an increase in charge 
processing (and, by extension, progress in our inventory).
    EEOC also has responsibility for hearings and appeals of complaints 
filed by federal employees. Our hearings data shows that we received 
7,802 hearing requests, had 8,685 resolutions, ended the year with an 
inventory of 4,912 and had an average processing time of 248 days. In 
the area of federal sector appeals, we received 6,743 appeals, resolved 
6,405, and ended the year with an inventory of 3,887. The average 
processing time was 220 days for fiscal year 2006--a 13 percent 
increase from the previous year. Our federal sector appeals data 
reflects increases in inventory and average processing time and a drop 
in resolutions.
    Litigation.--Our litigation program is an important part of our 
overall enforcement of the law. During fiscal year 2006, our litigation 
program filed 371 new lawsuits on the merits and resolved 418, 
resulting in monetary benefits of $44.3 million. We seek to maximize 
the impact of our lawsuits through various means, including obtaining 
relief for multiple aggrieved individuals and securing broad-based, 
prospective relief to prevent the recurrence of discrimination. A 
strong litigation program also provides an incentive for the early 
resolution of a charge during the agency's administrative enforcement 
process in the pre-cause determination and mediation process and in the 
conciliation process. We also believe that publicity of high impact 
litigation and other cases serves to increase voluntary compliance with 
the laws we enforce.
    The EEOC's fiscal year 2008 budget request includes $2.9 million in 
direct support to our litigation program, with a total litigation 
budget of just under $57 million. We project a slight decrease in our 
suit filings for fiscal year 2008, but the demands on our staff and our 
resources are expected to increase. This is because we expect to devote 
some of the requested funding to litigating larger and more complex 
cases involving systemic discrimination developed through the 
Commission's new Systemic Program. While these cases are resource-
intensive to litigate, they have great potential to pay enormous 
dividends in the long run.
    Systemic Program.--Last April, the Commission considered the 
recommendations of our Systemic Taskforce which was led by Vice Chair 
Leslie Silverman. The Commission unanimously passed a series of motions 
calling for the Commission to reinvigorate its Systemic efforts. 
Systemic cases are defined as ``pattern or practice, policy and/or 
class cases where the alleged discrimination has a broad impact on an 
industry, profession, company, or geographic location.'' Since the 
passage of Title VII of the Civil Rights Act of 1964, as well as with 
later amendments and authority granted, Congress recognized that 
employment discrimination cannot be eradicated without a focus on its 
systemic nature. A strong systemic program is crucial to the 
elimination of instances of pattern or practice, policy and class 
discrimination which has a broad impact on an industry, profession, 
company or geographic location.
    Therefore, to complement private sector enforcement of Title VII, 
the ADEA, the EPA and the ADA, the Commission has embarked upon an 
enhanced systemic enforcement program. Systemic plans from all District 
Offices were approved in December 2006. Commissioner charges based on 
those plans have been submitted and signed by Commissioners. While 
Systemic cases often take two or three years in order to investigate 
and develop evidence to decide whether to proceed, I expect some of our 
cases to be developed and resolved through settlement, conciliation or 
a litigation filing within a year.
    ADR/Mediation.--Our budget request includes $22.3 million for 
mediation. In fiscal year 2006 we increased the number of our mediation 
resolutions to 8,202. Since its inception, EEOC's mediation program has 
been highly successful in resolving charges of employment 
discrimination. In addition to the record number of resolutions 
obtained through the mediation process in fiscal year 2006, a survey 
conducted by independent researchers to evaluate the program's 
effectiveness found that 96 percent of employers and 91 percent of 
charging parties that participated in the mediation process would use 
the mediation program again if offered. The Commission continues to 
conduct extensive outreach and publicity efforts to highlight the 
benefits of EEOC's mediation program and to expand charging party and 
respondent participation. Additionally, as a result of significant 
efforts focused on increasing the participation of employers in the 
mediation program, the agency continues to utilize Universal Agreements 
to Mediate (UAMs) to secure employer support for the program. These 
agreements now number over 1,100.
    Outreach.--We also employ other strategies by which we address 
discrimination in the workplace. The best way to combat employment 
discrimination is to prevent it from happening in the first place. The 
Commission continues to work closely with its stakeholders to implement 
new strategies to stop discrimination before it starts. We are striking 
a vital balance between outreach and education on one hand, and 
enforcement and litigation on the other. We meet with advocacy and 
community groups, employer groups, the legal community, students and 
educational organizations, labor unions and the general public to 
assess current needs, and employment trends and issues. In recent 
years, EEOC staff also has increased our number of media presentations, 
including appearances on radio and television programs in languages 
other than English, providing information to uncounted thousands of 
people. The Commission recognizes the importance of outreach, 
education, and technical assistance to reach out to under-served 
constituents and to aid in voluntary compliance. In fiscal year 2006, 
EEOC conducted 5,634 outreach events, reaching nearly 302,000 people. 
Events included speeches, seminars, workshops, training programs, 
expanded presence visits, cultural expositions, conferences, and 
community group meetings. Approximately 4 percent of our budget 
request, or $12.6 million is allocated to outreach.
    Federal Sector.--The Commission fulfills its mandate to federal 
employees and applicants for employment through our hearings and 
appellate enforcement efforts, as well by exercising our oversight 
authority and providing guidance, outreach and technical assistance. 
Our budget request includes $47.5 million for our federal sector 
programs.
    The Federal Sector complaint process is one area by which 
stakeholders agree that improvements need to be made. We believe that 
the complaint process takes too long. By statute, federal agencies 
initially are responsible for investigating charges filed against them. 
Both Commissioners Stuart Ishimaru and Christine Griffin have been 
working on recommendations for improvement to the complaint process, 
and particularly on the agency investigative process. We have made 
advances in the processes under EEOC's direct control. For example, the 
inventory of requests for a hearing sharply declined from 5,994 in 
fiscal year 2005 to 4,912 in fiscal year 2006. Additionally, the 
average processing time from request to the conclusion of the hearing 
declined slightly last year. These are welcome developments. Both 
appeals inventory and average processing time have shown significant 
decline since 2001-2002, but both showed increases in fiscal year 2006.
    In addition, we continue to provide training, outreach, and 
technical assistance to federal agencies in the implementation of our 
Management Directive 715 to aid agencies in their efforts to build 
model EEO programs.
    Fair Employment Practices Agencies.--We are joined by our 96 State 
and Local partners, Fair Employment Practices Agencies (FEPAs), in our 
vital enforcement role. Our budget request calls for an amount for 
state and local contracts up to $28 million. Additionally, we continue 
to support the 64 Tribal Employment Rights Organizations (TEROs), 
providing outreach and training to address the specific equal 
employment issues facing the Native American community. During fiscal 
year 2006, we successfully transitioned our State and local government 
FEPA partners to the new Integrated Mission System (IMS), allowing EEOC 
to retire the old legacy Charge Data System. This migration will 
provide consistent data management and reporting across EEOC and FEPA 
offices nationwide. In response to recommendations from the State and 
Local Re-engineering Workgroup, during fiscal year 2006 we began a 
comprehensive national training initiative for FEPA staff. This effort 
will continue into fiscal year 2007.
    Information Technology.--Over the past several years, EEOC has 
completed several major information technology (IT) projects that have 
streamlined internal processes, reduced paperwork burden, integrated 
data, advanced our technological infrastructure, and allowed the agency 
to conduct business more efficiently. The EEOC is taking a fresh look 
at our Information Technology (IT) architecture and services in an 
effort to improve operational efficiency, lower recurring costs, 
increase customer satisfaction, and ensure that IT services are 
properly aligned with agency priorities and strategic plans. Our 
overall goal is more efficient usage of the resources that EEOC expends 
to maintain our IT infrastructure, while realigning our architecture to 
better support an environment that promotes collaboration, information 
sharing and analysis, enhanced communications, and streamlined work 
processes.
    During fiscal year 2007, we are integrating our EEO-1 and IMS 
systems, to provide improved analysis capabilities and data integrity. 
We have also expanded usage of video conferencing and video-streaming, 
using this technology to conduct depositions and external hearings, 
provide remote interpretive services, conduct remote training sessions, 
and improve collaboration/communication across our multiple office 
locations. In addition, I have already discussed our systemic program, 
and several initiatives are underway to ensure that EEOC's technology 
infrastructure supports a seamless, nationwide, systemic practice.
    During fiscal year 2008, we will maintain our critical technology 
infrastructure but will not undertake new projects or expand current 
services. Our ability to move forward on other major technology 
initiatives, such as document management and data warehousing will be 
largely dependent on future funding. EEOC is currently conducting 
studies and developing business cases to support requests in these 
areas.
    Initiatives.--It is critical not only that we manage our inventory, 
but that we spread the word that preventing discrimination benefits 
everyone. Some of our outreach is conducted through several targeted 
ongoing initiatives. These initiatives have no separate funding 
component and are performed by all of our professional staff and 
included in our overall outreach, education and technical assistance 
budget.
    In support of the President's New Freedom Initiative, we will 
continue to work with state governments on strategies for removing 
employment barriers and to promote the employment of people with 
disabilities. Our Youth@Work Initiative empowers youth to understand 
their workplace rights and responsibilities and encourages employers to 
promote fair and inclusive workplaces. Our Small and Mid-size Business 
Initiative expands outreach and technical assistance to the small 
business community to encourage voluntary compliance. Our newest 
initiative--ERACE, Eradicating Racism and Colorism in Employment--
addresses the persistence of race and color discrimination in the 
workplace through outreach, dialogue, and the pursuit of priority and 
emerging legal issues. In addition, in fiscal year 2005, we inaugurated 
the agency's first-ever Freedom to Compete Award program to recognize 
best practices in the private sector, public sector, associations and 
other organizations. In the federal sector we have begun our LEAD 
initiative (Leadership in the Employment of Americans with 
Disabilities) to address the lack of improvement in the federal 
government's employment of people with targeted disabilities.
               national contact center and repositioning
    The EEOC, like all federal agencies today, faces many challenges. 
We are first and foremost an enforcement agency and we must provide the 
quality and integrity in our enforcement efforts that the public 
expects and deserves. As such, we strive to manage our resources to 
most effectively and efficiently fulfill our enforcement mandate.
    Approximately 80 percent of the EEOC's budget has been consistently 
devoted to relatively fixed expenses, primarily payroll and rent. An 
additional 9-10 percent has been dedicated to our partners in state and 
local Fair Employment Practices Agencies. Therefore, our fixed costs of 
approximately 90 percent of the agency budget leave us with little 
discretion in terms of shifting additional resources to respond to 
pressing needs. We continue to look for ways to maximize the return on 
our resources.
    In August 2002 we commissioned the National Academy of Public 
Administration (NAPA) to conduct a study of our structure and program 
delivery systems. In February 2003, the Academy released its findings 
and recommendations. The Academy Panel made a series of 
recommendations, most significantly recommending that: (1) we establish 
a National Contact Center (NCC) as a way to improve the quality, 
timeliness, access, and consistency of services to EEOC's customers and 
(2) that we realign our field offices flattening the field's management 
staffing levels, and (3) that we reorganize our headquarters. We have 
acted on the first two recommendations and have begun work on the 
third.
    National Contact Center.--After the Commission approved the 
contract to establish the National Contact Center (NCC) in September 
2004, it became operational in March 2005 on a two-year pilot basis and 
was extended by the Commission for one additional year in July 2006. 
The NCC operates under a contract to Vangent, Inc., from a facility in 
Lawrence, Kansas. For fiscal year 2008, $2.5 million is included in our 
budget for the operation of the NCC. The NCC allows 24 hour access to 
the EEOC and the ability to speak with a live person 12 hours a day, 
five days a week. Since it began taking calls on March 21, 2005, the 
NCC has received more than 960,000 phone calls, nearly 48,000 emails, 
and more than 2,500 faxes and letters from the public. The NCC's 
Customer Service Representatives (CSRs) have handled more than 600,000 
calls in English, Spanish and through the TTY. In fiscal year 2006, the 
first full year of operation, the NCC handled over 500,000 contacts, 
including 284,000 calls answered by CSRs. We expect the contacts 
handled by the NCC to increase by 100 percent in 2007. The remainder 
were handled via Interactive Voice Response (IVR), e-mail, fax, or 
written correspondence. Initial focus was on training, monitoring for 
quality, accuracy, and interpersonal skills. As these have been 
developed, we are now prioritizing actions to increase call volume and 
integrate NCC and EEOC procedures and practices.
    In 2006 the NCC was reviewed by EEOC's Inspector General. The IG's 
report made a number of recommendations that needed to be implemented 
if the NCC was to be a more effective and integrated component of the 
EEOC. Many steps have been taken to implement those recommendations. 
Among the recommendations was the need to increase the call volume to 
meet prior projections. Actions have been taken to increase call volume 
since the beginning of fiscal year 2007. The result is reflected in the 
most recently available monthly report which shows that in March 2007 
the NCC received approximately 65,174 contacts, including calls and 
emails, which projects to almost 800,000 contacts per years. A recent 
(January 2007) report by the National Academy for Public Administration 
found that EEOC has begun to aggressively address shortcomings in the 
NCC's implementation and follow-up and that progress has been 
noteworthy. The NAPA panel also found that the cost of moving the call 
center into EEOC would substantially exceed the current arrangement, 
and that an in-house EEOC-run NCC--staffed with EEOC employees--would 
cost $8 million for the first year and $5.7 million annually 
thereafter. Given the cost to bring the NCC in-house and the fact that 
many improvement-plan initiatives still are being implemented, the 
Panel recommended that EEOC maintain the current arrangement until and 
unless a more detailed, comprehensive cost analysis is conducted.
    Through the Center we have compiled data on the race, national 
origin, gender, and age range of callers and can separate the reasons 
people call into various topics. Among our findings, we now know that 
less than 40 percent of the callers are calling about potential 
charges. As of this month, we will be able to run reports on the bases 
and issues that people call about and show trends by region, race, 
national origin, gender, and age. This information will help us to know 
how to more strategically focus our resources. The NCC is a good 
investment--it allows the public greater access to our agency, permits 
us to analyze trends and other data, and frees up EEOC employees to 
focus on investigation, mediation and litigation. Overall, I believe 
both the IG and NAPA assessments have resulted in an improved system 
that will better serve the Commission. The extension of the NCC will be 
the subject of a Commission vote later this year.
    Repositioning.--The Commission also realigned its field 
organization effective January 2006. This reduced the number of our 
districts, reclassified the status of some offices, and allowed us to 
balance the workload within our districts. This was done without 
closing any offices or reducing staff.
    With the implementation of the field repositioning plan and the 
consolidation of 24 district offices into 15 districts, the agency has 
realized the benefits from being able to redirect more staff to the 
front line duties of enforcement and mediation. In preparing the 
repositioning plan, we looked at the resources EEOC was spending on its 
management and administrative positions. The previous EEOC structure 
was put in place in 1979 when the Commission had approximately 3,800 
employees; whereas in 2005 we had approximately 2,400 employees. We did 
not believe it was prudent to retain a management and administrative 
structure that was designed for a much larger workforce and was 
designed when we did not have the advantages of modern technology for 
our business uses. In fact, in 2006 we opened two new offices in Las 
Vegas and Mobile to provide access to the EEOC in growing and 
underserved areas. Beginning in 2003 we initiated a five-year program 
to more appropriately size our field office space as leases expire, 
with a goal of reducing rent costs by 35 percent. The lease on our 
headquarters building expires in 2008 and we are working with our 
landlord, the General Services Administration, to find a location that 
will meet our current space requirements.
    We are now working on the third of NAPA's major recommendations, 
the evaluation and reorganization of our headquarters structure.
                               conclusion
    We will continue to review our operations and infrastructure to 
obtain savings wherever we can so that we are best able to place our 
resources where they are most needed. We have been diligent in our 
efforts to do so and to build a sound financial model. We believe that 
the efficiencies that we have in place will in the long term reap 
benefits; however, we cannot and will not lose sight of our current 
posture and the need to continuously align our resources with our 
mission.
    It is essential that we be fully funded at the President's request, 
so that we can maintain staff and deal with the inventory issue to the 
best of our capability. While we are concerned about our rising 
inventory and its impact on our ability to timely investigate charges 
and provide efficient customer service, we are confident that we can 
reduce the inventory and our charge processing time by more efficiently 
utilizing our existing resources.
    Madam Chair, the EEOC cannot fight discrimination in the 21st 
century with the same methods that have been used in the past. Great 
strides have been made in the past four decades, but there is no rest 
for the EEOC. Approval of our 2008 budget is essential to permit the 
EEOC to continue with its vital mission of ensuring that equality 
exists in the American workplace. The citizens of our Nation deserve no 
less. We must continuously work to effectively allocate our resources 
so as to meet our statutory mandates. Madam Chair, we appreciate your 
support and that of the Subcommittee. Thank you for inviting me to 
appear before you today and I will be happy to answer any questions you 
might have.

    Senator Mikulski. Thank you very much for this testimony. 
We are going to vote. The vote will start in about 15 minutes, 
although it's never as calibrated as we all think. And I 
understand my colleague, Senator Shelby, might not return, to 
be able to return. Senator, what I'm going to suggest as a way 
of proceeding that we turn to you and then----
    Senator Shelby. I'll be quick.
    Senator Mikulski. We want you to do what you need to do 
here and then we'll return and when the vote occurs, we'll 
recess, dash over and come right back.

                            OFFICE CLOSURES

    Senator Shelby. Okay. Thank you, Madam Chairman. I'll just 
get right to some of the issues that I raised. In my opening 
statement, I mentioned that I was concerned about the cut in 
State and local funding. You alluded to that. Your budget 
request reduces funding to the State and local offices--it's my 
understanding--by $2 million from the 2007 budget. Will this 
cut cause any offices to be shut down? I mentioned the Mobile 
office, which covers south Alabama, part of Mississippi and the 
Florida Panhandle. We think that's an important office, not 
because it's located in my State. It could be located in 
Maryland or somewhere else but local offices do augment what 
you're doing.
    Ms. Earp. No, sir. We do not anticipate closing any local 
offices.
    Senator Shelby. Okay. Well, that's good.
    Senator Mikulski. Mr. Chairman, what do you mean by local 
office? Are you talking about a Federal office? What do you 
mean?
    Ms. Earp. Well, definitely we don't plan to close any State 
or local offices under the fair employment practices agencies 
but we have no plans, have never considered closing any of the 
Federal offices either.
    Senator Shelby. That's good to know because I don't--if you 
start closing offices anywhere, I don't believe you can carry 
out the mandate that I know you want to do and have the EEOC to 
do as part of your charter and your responsibilities. That was 
my--that's one of my concerns, funding reductions.
    At the time of the release of your 2008 budget request, 
there were only 2,246. That's a decrease of 978 people, which 
seems like a number over a short period of time, especially 
since the backlog of charges has increased, that you mentioned. 
How are these staffing reductions spread across the agency, 
including field offices? Have you worked that out yet and if 
you haven't, will you let us know what you're doing?
    Ms. Earp. Well, we constantly balance the workload against 
the number of people available to do the work but I would be 
happy to submit to you a more detailed----
    Senator Shelby. To the subcommittee, to all of us.
    Ms. Earp. To the subcommittee.
    Senator Shelby. Sure. If you would do this, that would be 
very helpful from my standpoint. It's my understanding that 
there are 2,381 is the actual number of current employees or is 
this a ceiling for the maximum number you plan to employ? Do 
you want to answer that for the record?
    Ms. Earp. Yes, we plan to hire to our ceiling.
    Senator Shelby. You plan to continue to, under your 
leadership, for the EEOC to meet its responsibilities, do its 
job?
    Ms. Earp. Yes, sir, absolutely.
    Senator Shelby. Okay. Well, we have a lot of confidence in 
you. We know you are new on the job but you bring a lot of 
experience to this job and that's what we're interested in, is 
fairness in the workplace, fairness everywhere.
    Ms. Earp. Thank you.
    Senator Shelby. Thank you, Madam Chairman.
    Senator Mikulski. You were quick. Senator Alexander, will 
you be able to come back or would you like to proceed now as a 
senatorial courtesy?
    Okay. Then let me start the questioning and then we'll come 
back with Senator Alexander and if there is a follow up round. 
We want to acknowledge first of all, that the EEOC has been 
flat funded for 5 years. Five years, with an expanding 
population, expanding stress in terms of a variety of forms of 
discrimination and this flat funding has had to take its toll, 
which is one of the reasons we want to have this oversight 
hearing.
    Remember: management, morale, money. Let me get in--in the 
Congress when we passed the continuing resolution, we were able 
to come up with modest increases, particularly in the area as 
Senator Shelby has said, we increased it in State and local and 
also the private sector enforcement.

                           REPOSITIONING PLAN

    But let me get then to the punch line. Over the last 6 
years, there has been a reduction in full-time employees of 543 
staff. Was that--I'm going to talk about what caused the 
reduction and what are the consequences of the reduction, 
meaning the impact. Was the reduction due to the so-called 
right sizing, you know, all that nice private sector vocabulary 
or was it really budget driven when one looks then at the 
backlog and some of the other issues?
    Ms. Earp. I believe that the reduction is multifaceted. We 
stand in the current position today because like many Federal 
agencies, we have had a number of employees for some time who 
were retirement eligible. That's a factor. We also had early 
outs and voluntary retirements in the last couple of years and 
we've had some natural attrition.
    I think if you take all of those together, compared to the 
rising workload, it just makes sense. Over time, we have become 
a smaller agency like many.
    Senator Mikulski. But here's what I find difficult to 
understand. You have a rising workload, a changing population, 
even geographically, which I know you'll want to discuss with 
the field offices, which would seem to me with the backlog 
coming now of 40,000, don't you need more people?
    Ms. Earp. Well, we believe that we can manage for 2008 
within the President's budget. But I would submit, Madam 
Chairman, that the current situation, which some view as a 
crisis, started a number of years ago in the mid-nineties. In 
2002, EEOC----
    Senator Mikulski. We're not--we understand that. But we're 
right here now, to get it right. So we know that the backlog 
has been growing over a number of years. This is not finger 
pointing at an administration. This is trying to pinpoint where 
we are. We now have a backlog that we expect of 54,000 cases, a 
60-percent increase in 3 years. So let me then get to this. 
What does it take? What are your ideas for dealing with the 
backlog? How will we systematically be able to deal with the 
backlog and what do you need to be able to deal with this 
backlog?
    Ms. Earp. Well, we are doing a number of things to gain 
efficiencies and attempt to manage the workload. We continue to 
reassign staff. One important decision that was made recently 
is to manage the agency as if it were a national model. In the 
past, we've been stovepipes--each district responsible for its 
resources and the management of its cases.
    For example, with legal, we will function like a national 
law firm so that work in one area, we move the people to the 
work. That particular district no longer has to be held hostage 
to the limited resources that it has there.
    Senator Mikulski. Yes, but what are the top three things 
that you need? So one is this national model and I'm not sure 
what that means. But what are the top three things to deal with 
the backlog? What do you anticipate the backlog reduction will 
be for this coming year? We know backlogs can't just evaporate 
but we know--so can you tell us the top three things--what are 
your benchmarks and goals? How will you measure improvements in 
the reduction of backlogs? What would be the matrix that you 
would use?
    So what is your plan? What are your top three? What are 
your benchmarks for evaluation and what will be the matrix that 
you will use to evaluate that these suggestions or management 
models are effective?
    Ms. Earp. Madam Chair, because we are finalizing our 
strategic plan, I would really like to provide you with our top 
three benchmarks, and especially our measures at a later time, 
if you would allow me to do that.
    Senator Mikulski. Certainly. We would like the benchmarks 
and we'd like the matrix so then we're all--we all are clear 
then on what are the criteria by which we can evaluate progress 
and we can evaluate--and we can do our stewardship. But what 
are the top three things that you are going to do to eliminate 
the backlog?
    So one is the national model idea.
    Ms. Earp. One is to function on a national model. Number 
two is to have enough savings to be flexible and we are getting 
our savings from managing our rent, managing our attrition 
rates, preparing to relocate the headquarters office, as well 
as right size field offices and to use money saved there. To 
better train our staff is the third.
    Senator Mikulski. So what you're really doing with your 
three ways of reducing backlog is trying to find money 
elsewhere and to come up with savings. Is that right?
    Ms. Earp. We're trying----
    Senator Mikulski. Do you need more people? Or are you--the 
Office of Management and Budget (OMB)--listen, we're not trying 
to embarrass you, please. Are you OMB embargoed and can't tell 
me that?
    Ms. Earp. Yes, ma'am.
    Senator Mikulski. Okay. Well, I think that answers the 
question. If I could come back to the 543, were they in 
particular areas, like law? Were they back office support? Were 
they paralegals? Are there ways that technology can help you do 
things apart from this call center? We'll come back to that. 
Where did you lose most of your people?
    Ms. Earp. Most staff were lost with investigators and 
administrative support staff. Paralegals, clericals, the people 
who are a part of a very people-driven process on the customer 
service end. We've had less loss, I think, with attorneys but a 
lot on the enforcement staff with investigators.
    Senator Mikulski. So really, the front line staff, which is 
where the calls come in and then the people who actually 
initiate, particularly that initial claim and that's where, 
because you've lost investigators, the backlog in the initial 
claims is the one that's growing. Am I correct in that?
    Ms. Earp. Yes.
    Senator Mikulski. And then, of course, investigators need 
what we'll call the back office support, is that correct?
    Ms. Earp. Yes.
    Senator Mikulski. Can you tell me about how many 
investigators you lost and what would that be in terms of a 
budget item?
    Ms. Earp. I can't provide budget information but over a 
period of time, we've lost about 500 employees, the majority of 
those being on the enforcement side of the house versus the 
legal side.
    Senator Mikulski. Right. And enforcement is a word to mean 
the investigation of the complaints, which then determine the 
nature--when the validity of the complaint and the nature of 
the complaint, which meant some could go into mediation and 
some would have to follow our legal procedures, is that right?
    Ms. Earp. That's correct.
    Senator Mikulski. But this is the gateway and then would 
you say that this is also now the choke point in terms of 
creating the backlog?
    Ms. Earp. Yes. The inventory and receipts come in on the 
enforcement side of the house so the inventory grows on the 
enforcement side of the house.
    Senator Mikulski. Okay. My time has expired. I want to turn 
to Senator Alexander and Senator, why don't you proceed?

                       SALVATION ARMY LITIGATION

    Senator Alexander. Thank you, Madam Chairman. I have a 
question on a little different subject. Thank you for coming 
and I say, as I reflect on the discussion you've just had with 
the chairman about the need to allocate to resources and the 
56,000 case backlog. Are you aware of the lawsuit that the EEOC 
has filed against the Salvation Army, alleging that they fired 
two employees for not being able to speak English, according to 
the Salvation Army's policy that its employees should speak 
English in the workplace?
    Ms. Earp. Yes, sir.
    Senator Alexander. I want to ask you about that a little 
bit. As I understand the facts, the Salvation Army has a policy 
that says employees are expected to speak English and that it 
gave two employees who did not, 1 year to learn English and 
then when they didn't, it fired them. Am I to understand that 
any business in the United States cannot have a policy that 
requires its employees to speak our national language?
    Ms. Earp. No, sir. The--and I don't want to say too much 
about the Salvation Army case because it is ongoing. But the 
question, when an employer has an English only standard, as is 
alleged in this particular case, the issue for us is whether or 
not there is a business necessity for that requirement. If the 
charging party, the victim, the plaintiff, is engaged in work 
that doesn't require customer contact that is not a matter of 
health or safety, that there appears to be no legitimate reason 
to require English only, then it becomes unlawful or at least--
--
    Senator Alexander. Well, whose job is it to prove that? It 
would be the employer's responsibility, right?
    Ms. Earp. Well, the employer has a responsibility to 
articulate for us a business necessity.
    Senator Alexander. Right. So every employer in the country 
has got to come before the EEOC and prove that there is a 
reason for speaking English only. Do you conduct your staff 
meetings in more than one language?
    Ms. Earp. No, sir.
    Senator Alexander. What's the reason for that?
    Ms. Earp. I only speak one.
    Senator Alexander. Well, what about your employees? Do you 
hire employees who only speak English in your staff, for 
example?
    Ms. Earp. No, we have staff that are bilingual.
    Senator Alexander. Well, no--only English. I mean, if 
Senator Shelby were to say, I only hire employees who can speak 
English because we have maybe 100 languages spoken in Alabama 
and I want to make sure that the common language is spoken 
here. Would he have to justify that to the EEOC that he has a 
business reason to do that?
    Ms. Earp. No. I think the circumstances under which we 
would be interested or get involved are very specific and on a 
case-by-case basis. An employer who establishes an English only 
rule has a responsibility to show a business necessity for that 
rule.
    Senator Alexander. Madam Chairman, I only have 2 minutes 
left. I find that an astonishing waste of your time and 
contrary to every effort we're making in the United States 
today to try to have one country. I mean, I've spent the last 
40 years voting for civil rights acts, but the reason was so 
that we could have a single country and there are only a few 
things that unite us.
    One is our common language, English. One is a few 
principles that we learned in the Declaration of Independence--
I mean, I hardly know where to start with this. The Senate, 
last year, in debating the immigration legislation, declared 
English our national language, which you're now suing the 
Salvation Army to say they can't require employees to speak, 
even though they clearly posted it and employees don't have to 
work for the Salvation Army--the Senate said, we're going to 
give 500 grants to help prospective citizens learn English.
    The Senate said that people have to learn English before 
gaining legal status here. Since 1906, people have had to learn 
English to become citizens of the United States. It's not a 
punitive requirement. It's a requirement to help us make a 
common language.
    We have 28 languages spoken at the school my daughter went 
to. And it seems to me, completely contrary to everything I 
know about the importance of achieving unity in our country for 
us to, in effect, by your lawsuit, require every single 
employer in America to prove business necessity to the EEOC in 
order to require English in the workplace. Some may have to 
worry that if they post that in order to work here, you have to 
speak our common language, English, that they may be sued by 
you if they don't.
    Carlos Ghosn is the head of Nissan. He went to Japan to 
take charge of that company. He requires them all to speak 
English in their meetings because they need a common language. 
I don't know how you can conduct a staff meeting at the 
Salvation Army Thrift Store if people speak 15 different 
languages. A 9-1-1 telephone call wouldn't be useful to a 
Chinese person if the person who answered the phone spoke 
Spanish.
    So I would like to respectfully ask that if you have a 
backlog of 56,000 cases, that you put your resources on 
something other than harassing the Salvation Army Thrift Store, 
which is a nonprofit, charitable organization that relies on 
contributions for having to hire lawyers to defend for 
requiring their employees to speak our common language. I can't 
imagine why the EEOC would do that. And if necessary, I'll 
introduce legislation to permit employers in the United States 
to require their employees to speak our common language in the 
workplace. I never had imagined that might be necessary but if 
you persist in this, then I intend to do that.
    Senator Shelby. I just want to ask the chairperson, what is 
the origin of this lawsuit, assuming that what he is asking is 
factual and I believe, to me, that's--you know, we're promoting 
English as the language that unifies us. It binds us together. 
I think if you're doing this, you're going down a path that 
Congress is going to hit you hard on and I believe if you're 
doing this, I don't know what the legal basis of that is. I've 
never heard of such.
    Ms. Earp. EEOC has had a longstanding policy that 
essentially says when an employer takes an action that could be 
construed as an action based on that person's ethnicity, their 
race or their gender, that the employer has a responsibility to 
articulate a reasonable, legitimate business necessity. In 
other words, an employer can't say to someone, you can't speak 
your foreign language, your native language on the job unless 
there is a business reason. If it were for health, a nurse, if 
it were for public safety, a police officer, then it is 
required. But if the person is cleaning your floor or if the 
person is pressing your clothes or in this case, merely folding 
clothes but not having--allegedly not having any contact with 
the public. There appears to be no business reason to deny that 
person the right to speak their native language.
    Senator Shelby. Are we talking about working or speaking? 
You know, why--I personally wouldn't hire anybody in my office 
here or anything else, any other business if they couldn't 
speak English because English is the business language of this 
country. They couldn't help me. They couldn't help. I think 
you're missing the point.
    Senator Mikulski. Before the Chair responds, I'm going to, 
upon the completion of this line of questioning, the 
subcommittee will stand in recess and the first of the three to 
get back that wants to continue questioning can pick up on it. 
I'm going to excuse myself now. Did you want to?
    Senator Alexander [presiding]. Madam Chairman, that will be 
all my questions. I would just ask the Chairman in light of her 
56,000 case backlog and the commitment of this country to 
English as our national language, to think very carefully about 
whether this not only is a wise use of resources, but to 
consider that we've required every new citizen in this country 
to learn English since 1906. That's not discrimination. That's 
a form of national unity and we seek ways to encourage people 
not to learn English, not to learn it at the beginning of the 
previous century.
    Organizations all over America required the learning of 
English so that we could be one country, so we could talk with 
one another and that was one way we became Americans. Our oath 
of citizenship actually renounces where we've come from and 
says we've become an American and 650,000 people take it this 
year and they don't get to be Americans unless they speak 
English.
    I introduced legislation last year the Senate passed to say 
you can become a citizen a year earlier if you become 
proficient in English to try to send a signal of the importance 
of our common language. So it seems to me that if a company 
posts this and believes it is important to speak the common 
language, to have an integrated team, that it shouldn't be 
required to hire lawyers and justify to the EEOC why that 
company requires its employees to speak our common language in 
the workplace. So I hope you'll think carefully about this and 
about the relative value of it in terms of all the other things 
that you have to do.
    Ms. Earp. Senator, may I seek a private meeting with you at 
some point and perhaps your staff, to share the policies and to 
further discuss what your concerns are?
    Senator Alexander. I'd be happy to do that, Madam Chair and 
now if you'll excuse me, I'm going to join my colleagues and go 
vote.
    Ms. Earp. Thank you.
    Senator Mikulski [presiding]. The Subcommittee on Commerce, 
Justice, Science is officially reconvened and continues its 
oversight hearing on the Equal Employment Opportunity 
Commission.

                           REPOSITIONING PLAN

    Madam Chair, I want to go into questions about the field 
offices and the results of the National Academy for Public 
Administration (NAPA) study. Ordinarily, I'm a big fan of NAPA 
studies. When I was both the Chair and the ranking member of 
VA/HUD, we used--Senator Bond and I used NAPA a lot. In fact, 
it helped start one of the initial reforms of the Federal 
Emergency Management Agency (FEMA) under President Bush One. 
But I'm not so sure about this NAPA set of recommendations and 
the field studies and the track it put us on and now where we 
are with that.
    As I understand it, this resulted in--the number of 
district offices was reduced from 23 to 15. Is that correct?
    Ms. Earp. Yes.
    Senator Mikulski. And are there plans for further 
reductions now?
    Ms. Earp. No.
    Senator Mikulski. So you feel this is it?
    Ms. Earp. The field repositioning has been effective since 
January 2006. For now, things seem to be working well. There 
are no plans to further realign the field although we are 
looking at restructuring headquarters.
    Senator Mikulski. Well, we'll come back to headquarters 
because there is a lot in the--provided in the news about the 
headquarters.
    Let me go to where I'm concerned about the field offices 
and then I'm going to talk about the Maryland field office, 
which put us in a very prickly relationship. Now, when the 
Equal Employment Opportunity Commission embarked upon the 
implementation of the reduction of the number of district 
offices, the authorizing committee that Senator Kennedy chaired 
and I was a member, voiced very strong opposition to that with 
your predecessor. So again, this is something again that you've 
inherited and we had very serious concerns about which offices 
were going to be downsized, not only numerically but in terms 
of stature and in terms of the focus of what their work would 
be and you're familiar with the district office, the local 
office has very different functions.
    We were ignored and our problem is this--here's our 
national problem. Our national problem is number one, 
population centers are changing. So as you know, the growing 
populations, particularly in our border States. If our western 
Senators were here, Texas, New Mexico, of course California--
with that is bringing other kinds of challenges on 
discrimination.
    Also we have places in our country where there are centers 
of large Muslim populations. They feel that because of dynamics 
in the larger society, they are facing discrimination from the 
kind of clothes they could wear in the workplace to overtly 
being shut out of possible jobs.
    So my question to you is the framework that we now have for 
district offices demographically outdated? And if you don't 
know the answer to that, that's okay because I'm going to get 
to another part of that. But do you see? This study was done in 
2002. We're in a very different world order now, in many 
different ways.
    I'm concerned that your location of your field offices--
we're not talking about closing any but really helping you 
meet--we have a saying. I'm a professionally trained social 
worker. I know you come from a background of Federal agencies--
to meet people where they are, not where you want them to be. 
You have to meet people where they are, not where you've got 
your field office.
    So my question is, that in the analysis of where your cases 
are coming from, where your analysis is with the new demography 
of our country, is in fact the need for more field offices, 
more strategically located on the basis of the complaints that 
are coming. In other words, where the dynamics seem to be and 
also where the population centers are that seem to be 
experiencing significant barriers in terms of employment and 
employment discrimination. Do you see where I'm heading?
    Ms. Earp. I do and I have two responses. One response is, 
we think for the short term that the decision to open the 
southern office in Mobile and the western office in Las Vegas, 
we're right on--that they were consistent with the demographic 
trends.
    My longer answer is, one of the positive things about the 
National Contact Center is it allows us to capture the data 
from where the calls come in, not just the issue raised but 
what part of the country right down to the zip code, that call 
came in from. So in the long term, I think that we will be 
better able to refine where offices are located.
    The only other point that I would make, Madam Chair, is we 
have historically tried to put the offices in a transportation 
center because often charging parties don't own cars. Sometimes 
they are not the highest socioeconomic rungs so it has been 
important to at least have those offices where public 
transportation is accessible.
    Senator Mikulski. Well, first of all, I think that's a very 
important goal and we'll come back to again, to the Maryland 
situation. But to be sure I understand the answer to your 
question, you want to use the data from the call center as a 
way of analyzing trends, both in the nature and the type of 
complaint that you're getting, because it's supposed to be 
gateway and number two, you want to look at it in terms of 
where is the volume coming from, to then assess whether you 
need more field offices. Is that correct?
    Ms. Earp. Well, we have the capability of looking at that 
data over time to see exactly what the issues are and where the 
issues are coming from. I don't think that we have given, at 
this particular point, any study or thought to opening 
additional field offices. Obviously that requires a lot of 
thought, a lot of deliberation, a lot of consultation with----
    Senator Mikulski. But I'm thinking about it. And I believe 
that members of the subcommittee are thinking about it because 
one of the hallmarks of our country is the fact that if you 
feel you are discriminated against, you have legitimate 
channels for redressing grievances. There are countries that 
are facing challenges, European Union (EU) countries with 
immigrant populations where they feel that they are frozen in 
place and they become targets of recruitment for radical 
organizations.
    We, on a bipartisan basis, believe in the opportunity 
ladder, which I believe you do believe in and you yourself, as 
I, have lived and benefited from this ladder. At the same time 
there must be a place to redress your grievances. In this 
country a person should not feel that you are frozen in place 
because of what your last name looks like or the clothes you 
wear or the accent that you might bring into the marketplace 
and if you feel that, if you feel you have a legitimate place--
you have a place to take a legitimate grievance and that 
grievance will be met in a fair, open, consistent way, it's our 
way. It's the American way. And because it is an American way, 
that's why we've been able to, every generation, right or 
wrong, in every generation, welcome these new people.
    So you see why we feel--it's not about field offices and 
it's not about my district or that district. It's about America 
and it's about having the opportunity to redress grievances.

                                FUNDING

    I was looking at--first of all, I'm very disturbed that the 
EEOC has been flat funded for 5 years. We also know it's been 
underfunded for a number of years so we're not pointing to an 
administration though this one has kept it flat funded while 
other benefits went in other areas.
    So we're looking at that. I was going to suggest a study 
but before we get into that, what we will then ask for you and 
your team to think about it. Because if the call center is 
going to be your tool, then the call center has got to work 
right and I don't have a lot of confidence right this minute in 
the call center. So let's put this on hold because I'm going to 
come back to the field offices.
    But you see where we are heading. It is to mission and to 
purpose. It's not about bureaucracy and these questions are 
meant so that we can have--we want America to be America. 
That's what we want. We want the Constitution and its laws to 
be able to be enforced and we want the people who are asked to 
do that to be in the right place with the right number of 
people, with the right tools to do this. That's where we're 
heading with this.

                      DOWNSIZING BALTIMORE OFFICE

    Now, let me go to the field offices. My favorite topic of 
course, is Baltimore. We got into a very prickly relationship 
with your predecessor and we got into a prickly one for several 
reasons. One, we felt we were not listened to and I'll give the 
reasons why we raised our challenges to the downsizing or down 
grading of the Baltimore office.
    Second, we felt that one, there was a promise made to take 
a look at it, which was never fulfilled. And number three, we 
felt that it was overall symbolic of what was felt by many 
employees, an imperial management style. So you need to know, 
that's where all the prickly comes from. Okay?
    Now, let's start with not being heard. One of the reasons 
we were concerned about the Baltimore District Office is not 
because it's Baltimore and Senator Mikulski's going to fight 
for one more thing and don't close this and don't downgrade 
that. Part of that would be true. You know me. You're my 
constituent. So you know where we would be.
    But I will go to the Baltimore office and what its job is. 
As you know, Maryland is the home to Federal employees. You 
yourself worked at, I believe, at NIH.
    Ms. Earp. Yes.
    Senator Mikulski. As well as other Federal agencies and I 
believe you developed certain diversity initiatives, which were 
much needed at the agency. As you know, it's had its own 
challenges with equal opportunity and you see, that's my whole 
point that within the National Capital region, not only 
Baltimore but also Northern Virginia.
    We are home to probably the largest number of Federal 
employees than anywhere in the United States of America. 
Because of that and in the Baltimore area, we're the home to 
significant ones, like the Social Security Administration 
(SSA). There are over 15,000 people who work there because it 
functions 24/7. You just don't do Social Security--it's not 
only the people who take the claims--all of that processing, 
which means the right check to the right person right on time, 
goes 24/7.
    That Social Security office in and of itself has an 
incredible history. When Lyndon Johnson was President and he 
said that the Federal Government would be the model employer, 
many African-Americans for the first time, felt that if you 
were talented, you could go to work for the Federal Government. 
So people like Kurt Schmoke's dad, with a background in 
chemical engineering, could go to work at Aberdeen. Men and 
women who had experience in law or business could come to 
Social Security.
    If you came to me with the Woodlawn community and saw the 
people who work there and people who retired. They worked hard. 
They did the right check at the right amount to the right 
person at the right time but they also, because they had 
opportunity at Social Security, could move on up, raise a 
family, send their kids to school and make a life. I only use 
that as an example.
    What we know in the Baltimore area is that because of the 
number of Federal employees that they needed a place to go. So 
just even in that larger metropolitan area, then also we are in 
tremendous economic change with populations. Twenty-five 
percent of our population in the State is African-American, 
still facing redlining and sidelining.
    As you know, sometimes it is sidelining, not the overt 
discrimination and you are an expert in the field. So we were 
concerned that because they eliminated the regional attorneys, 
they eliminated 20 jobs and then they downsized, telling 
essentially the Baltimore metropolitan area, go to Washington.
    But going to Washington along with the Washington 
metropolitan demands on EEOC, which again, looking back from 
your National Institutes of Health (NIH) hat, you know the 
stresses and strains and now you see it from a management 
capacity. If Webb and Warner were here, they would be talking 
about the Northern Virginia area. So you see why we didn't want 
Baltimore downsized? But we weren't heard. We were not heard. 
Then we were told, oh, I will take a look at it and then we 
were told that it would be kept a district office. That word 
was broken with me. Okay? And it was actually broken with 
Senator Kennedy, who also was aware of this.
    So it seemed like the team was clueless about being 
involved with Congress. Now, we can get involved in a lot of 
tying you up into knots and into all that. I don't want to do 
that. I believe it is new leadership and it's time for a new 
start. And I think that's what you want. Am I right?
    Ms. Earp. Absolutely.
    Senator Mikulski. Do you want to respond to what I've said 
so far?
    Ms. Earp. Yes. Let me start----
    Senator Mikulski. I went through this narrative because I 
felt--one, because again, we have national responsibility but I 
want to use my situation as a cameo because other colleagues 
have some of the same questions.
    Ms. Earp. Well, first of all, Madam Chair, let me say, I 
hear you. I hear you loud and clear and I thank you for giving 
me an opportunity to demonstrate my leadership and my 
commitment. I start by saying, I respect the role of the 
legislative branch, and obviously my Appropriations Committee, 
the subcommittee, I respect tremendously.
    I intend to operate in a spirit of transparency and one of 
comity and respect for your role and to seek the subcommittee's 
advice and guidance on changes, proposals, activities at the 
Equal Employment Opportunity Commission and I would also say, I 
am a political appointee today but I have 20 years prior to 
today, of being a career civil servant. I don't think anyone 
who has ever worked with me would describe me as being 
imperial. My style is open----
    No, no, no--I absolutely agree. I say that only as an 
example of what the changed environment is at the Commission 
today.
    Senator Mikulski. I want to talk about a way forward. First 
of all, I'd like to talk about the National Capital region and 
the tremendous changes that are coming to the region and then 
the fact that I would like an evaluation of the field offices 
and so on, in the National Capital region.
    The National Capital region, to me, is Northern Virginia, 
really up to around Aberdeen Proving Grounds. Okay? And what is 
happening is that base realignment and closure (BRAC) is 
coming. The base realignment and with that means more jobs. 
There are more jobs that are coming to Fort Belvoir than have 
ever come before.
    If we look at Aberdeen, Fort Meade, Naval Bethesda, these 
are all--Walter Reed is consolidating but also more coming to 
Aberdeen and to Fort Meade. We estimate that anywhere from 
10,000 to 30,000 new jobs are going to be created by base 
realignment that either will be direct civil servants jobs or 
private sector jobs and particularly in the area of security. 
Along with that will come support services in law, real estate, 
et cetera. So the good news is, our economy will continue to 
boom.
    At the same time, there will be new populations coming and 
some directly related to Federal employment. What I would like 
is to evaluate what it is that the EEOC needs to do to be ready 
because this was a 2002 NAPA study, which is no longer relevant 
to what the population is or won't be or whatever, particularly 
for those who have responsibility to Federal employees or 
private contractors funded by the Federal Government.
    Because if we're not the--you know this--if we're not the 
model employer, how do we go to the private sector? If we are 
not the best, then how can we ask them to do this? So, this is 
why I would like to both--we don't want to micromanage the 
nature of the study. We want to work with you in a very 
collegial way to take a look now at the National Capital region 
and what is here, both in public and private areas and how we 
need to reassess in a post-2002 world. Do you follow me?
    Ms. Earp. Yes.
    Senator Mikulski. So we can get at what do we need and 
where do we need it and is it really dysfunctional to get 
people who are working in certain areas to have to come to a 
Washington office that is already overburdened and overstressed 
because it's the Washington office. It's the mother ship 
office.
    Ms. Earp. Madam Chair, would you anticipate that we would 
fund this study out of the 2008 budget?
    Senator Mikulski. You mean fund the study? For whatever I'm 
going to ask you to do, I will make sure you have the money to 
do it.
    Ms. Earp. Thank you.
    Senator Mikulski. Okay? No, because we are--I will come 
back to the fact that I think I and others are concerned about 
the flat funding of the EEOC. We acknowledge that you've had to 
forage for funds so we're not--anything we're going to ask you 
to do, we will be a pay as you go subcommittee. Okay? That will 
be my contract with you. What I need back from you then is us 
to find out what it is that we need so we are focusing on the--
I'm a data driven lady. So on the basis of sound data that has 
had rigorous intellectual analysis about what is it that we 
need, even if it takes us a while to get to it but we'll know 
then what we need. And we can discuss whether that should be 
done internally or done externally. Okay?
    Because I come back to the fact that Maryland--we get 
casework calls but Maryland constituents are complaining about 
their complaints not being fully investigated. They feel that 
they are turned away early--that for a variety of reasons, they 
don't feel that their complaints are being rigorously 
investigated.
    So what we want to be able to do is look not only at 
Baltimore but the Capital region, looking at BRAC. As I said, 
just in Maryland alone, over 40,000 jobs but they really won't 
be coming until 2009 and 2010. We can just take a look at what 
will come. We also know that--so that's where, that's kind of 
where we are. Does that sound like a good way to go?
    Ms. Earp. Yes, ma'am.

                          NATIONAL CALL CENTER

    Senator Mikulski. Now, this takes me to the call center. 
You know, I understand why NAPA recommended the call center but 
we were really concerned because the Federal Government has not 
had good experiences with national call centers, whether it has 
been the Equal Employment Opportunity Commission, whether it 
has been the Immigration Service call center and so on.
    And what we were concerned about that with this 2-year 
contract, that with all the work that needs to be done, that 
they only agreed to 36 jobs. They got 7 days of training. They 
had training and experience in civil rights law. Calls never 
reached to the volume that EEOC predicted. I do acknowledge the 
facts that you have presented to the subcommittee seem to be 
different than what we heard even say, 3 months ago, about this 
call center.
    But to us, the call center has never lived up to its 
promise. We're concerned about the fact that though we say it's 
24 hours, it's really an answering machine, I believe, so could 
you tell me what you want to do with this call center? Because 
we're not happy with it. And yet, you're going to rely on it to 
be--play a very important role and then also to tell you 
trends.
    Ms. Earp. I would absolutely stipulate that the call 
center, the National Contact Center got off to a rocky start. 
But it is so dramatically improved from its beginnings in March 
2005. The call center currently will answer the phone in an 
average of 1 minute. There are times that the wait is somewhat 
longer but on average, in 1 minute. It allows us to track data, 
to do monitoring and the question about training for the 
customer service representatives--they receive the same 
training that we give brand new investigators.
    Senator Mikulski. When did you do that? When was all that? 
That's not what we were told. We were told 7 days of training. 
I think you give your investigators more than that.
    Ms. Earp. Not initially.
    Senator Mikulski. You mean your investigators only get 7 
days of training in civil rights law?
    Ms. Earp. They get 1 week of basic training. Now the thing 
with investigators is, we have an opportunity over time, to 
refine that training and they're on the ground so they get to 
practice their skills. But the customer service representatives 
are not responding to in-depth inquiries. We think that they 
have sufficient training to do that first response to the 
caller coming in. It is--despite the problems in the beginning, 
it is admittedly substantially improved today.
    The issue is, if we don't have a national way to answer 
phones of some sort, either the one that we're currently 
working with or one that is inside, we are going to be in a 
crisis because they answer more than 600,000 calls for us, 
which frees up--which frees up investigators and attorneys to 
do the real jobs that they are hired for.
    Senator Mikulski. You know, you and I could go back and 
forth on the call center and I don't know where it would take 
us. Whenever I ask a question, I always wonder, what's the 
destination? In other words, where am I going? What I--I want 
to acknowledge the validity of the need for a call center. 
Okay? So we understand that.
    The question is, is this call center really operating the 
way it should and what all does it need to be run effectively? 
I'm not disputing what you are saying. We could spend a lot of 
time going back and forth but I feel that I need an independent 
analysis of the call center. This is not being provocative with 
you. But where we then would have some type of document, again, 
for a way forward.
    So you see where I'm heading with the EEOC? We've given the 
EEOC a forum that they have not had in a number of years. I--we 
checked our records. We can't find when was the last time this 
subcommittee asked the EEOC to come and tell us their story and 
that we could share this.
    So this is one of the reasons we wanted to because our 
accountability and oversight is to see what is our job and then 
what is your job and again, for the way forward. So where I am, 
because we could talk about headquarters, et cetera, is to be 
sure that we have, for the need for the management reforms 
necessary, we're going to be looking at a way of getting an 
independent analysis.

                     HEADQUARTERS RELOCATION PLANS

    I'm going to come back to this in 1 minute but please tell 
me, tell me about this headquarters situation. I read that you 
are moving. I read that people don't like the fact that you're 
moving. I read they don't like where you're moving. We wonder 
about--do you have to move? What is it going to cost to move? 
Is this something that will take a lot of time, energy and be a 
distraction from the mission? Do you want to talk to us about 
the move?
    Ms. Earp. Well, change is always difficult and a move like 
this one--I was actually working for the Commission when the 
lease was signed on the building that we're currently in and I 
remember some employees back then not wanting to move from 
Columbia Plaza, which is where we were at the time. So the move 
is difficult.
    But in terms of managing our resources, we believe that a 
move is necessary. The Commission has factored into its budget 
process for the last 5 years, savings from rent. We moved the 
Washington field office into the headquarters building 1 year 
ago and immediately saved $500,000.
    So the plan for some time has been as leases expire, to 
right size the office. We've lost employees so we don't need as 
much space. So the short answer is, yes, we think that we need 
to move, not only because we don't need as much space as we 
currently occupy but because the current landlord doesn't 
really want us to stay. He really wants to go back commercial 
with that building.
    The General Services Administration (GSA) has served as our 
agent in this process. They effectively recommended a spot to 
us, which our very enterprising employees are speculating about 
where it is but really, because of the Procurement Integrity 
Act, we're not even at liberty to say exactly what the location 
is.
    Senator Mikulski. You mean I have to go into a classified 
hearing like I would with the Federal Bureau of Investigation 
(FBI) to find this out?
    Ms. Earp. Well, I----
    Senator Mikulski. No, I understand. But what you're saying 
is you have to move?
    Ms. Earp. Yes.
    Senator Mikulski. And that the landlord has told you to 
move?
    Ms. Earp. Essentially, the lease expires next year and he 
is----
    Senator Mikulski. The lease expires when?
    Ms. Earp. July 2008.
    Senator Mikulski. So it's July 2008, not July 2007. Okay.
    Ms. Earp. No but the process to plan for a move when you 
have technology, you have case files, you have to notify the 
public. We thought that we needed to get started. In fact, I 
feel we're starting a little bit late because we're only giving 
ourselves just a little more than 1 year when we probably 
should have had as many as 18 months to prepare.
    Senator Mikulski. Well--but you are working with GSA?
    Ms. Earp. Yes.
    Senator Mikulski. Because all the street buzz is that you 
were acting on your own.
    Ms. Earp. Not at all.
    Senator Mikulski. Kind of like drive-by buying.
    Ms. Earp. No.
    Senator Mikulski. So you're not a drive-by buyer for a new 
Federal----
    Ms. Earp. No, ma'am.
    Senator Mikulski. Well, I think again, we're always 
concerned about the process and the integrity of the process. 
As long as EEOC feels that it has to move and it is working 
with GSA that really is along the path that the subcommittee 
would want to go.
    It's now 11:30. We have many other questions, which we will 
submit for the record because we are--I'm due on the Senate 
floor for speaking on drug safety.
    But I think this has been a very informative and 
constructive hearing but where I want to go forward is to 
really get a picture now of where is the EEOC? And I'm going to 
ask for--and I want you to know, I'm not now being--I don't 
want to be viewed as pugnacious, but I am going to ask for a 
Government Accountability Office (GAO) audit of EEOC because I 
want to get a sense of what was done.
    And what they would recommend needs to be done, what was 
the financial impact of restructuring and ultimately, what does 
this mean in terms of enforcing our civil rights? And we'll 
look to your leadership team too, to discuss what additional 
studies do we need to do in addition to this, to see where EEOC 
needs to go.
    This is the 21st century and we are righting the wrongs of 
so many centuries, in terms of the mission of this agency, yet 
we have new populations and new challenges and new other ways 
of discrimination. You said you were a career employee for how 
long?
    Ms. Earp. Twenty years.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Mikulski. Twenty years. So you came in 1987. For 
those in 1977, it was another form of discrimination. For those 
first employees at the Social Security Administration, they had 
faced another kind, et cetera, et cetera. And we're just to 
make sure that the mission stays the same but we have new 
contemporary challenges. So we want to make sure that you're in 
the right place, meaning you are located in the right place 
with the right number of people, with the right resources so 
that we do the right thing by the people. So that's where we 
are.
    [The following questions were not asked at the hearing, but 
were submitted to the Commission for response subsequent to the 
hearing:]
           Questions Submitted by Senator Barbara A. Mikulski
                                backlogs
    Question. How can EEOC meet its mission when backlogs continue to 
grow and the organization cuts staff?
    Answer. The Commission is keenly aware of the problems associated 
with a growing inventory of charges. Notwithstanding this challenge, 
the agency has and will continue to fulfill its mission of eliminating 
unlawful employment discrimination based on age, disability, race, 
color, sex, national origin and religion. We wish to put our rising 
inventory and other challenges in perspective. In 2006, during the last 
fiscal year, EEOC successfully mediated 8,200 charges--the most in EEOC 
history; resolved (closed) 74,000 charges filed by members of the 
public; processed to closure 5 Commissioner or systemic charges; 
recovered more than $274 million for victims of discrimination through 
administrative and legal enforcement; and filed 371 new lawsuits on the 
merits. Additionally, the agency secured, in thousands of cases, non-
monetary relief such as changes in personnel policies, reasonable 
accommodations and modifications to employment testing. All of this was 
accomplished with existing staff.
    It is true that over the last year, EEOC has eliminated several 
managerial positions. As senior individuals have left the agency, their 
specific jobs were not filled but associated savings were allocated to 
filling front line investigator, trial attorney and mediator vacancies. 
At present, EEOC hires managers only for those positions that are 
critical to the success of the agency mission, but we continue to 
conduct hiring of groups of investigators and trial attorneys. The 
National Contact Center is also producing efficiencies. Our front-line 
enforcement staff now can work on cases uninterrupted rather than 
having to respond to general inquiry calls, which number nearly 700,000 
calls annually. Thus, staff are focusing on the jobs they were hired to 
perform.
    The Committee can be assured that EEOC will continue to manage our 
resources effectively, increasing supervisory spans of control, 
eliminating managerial layers and training our staff in new 
technological developments. We are most fortunate to have a talented, 
highly-motivated workforce so that we can continue our mission of 
eliminating unlawful employment discrimination ``root and branch''.
    Question. How is employee morale at EEOC?
    Answer. The Partnership for Public Service reported in their ``Best 
Places to Work in the Federal Government 2007 Rankings'' that when 
compared to 30 large agencies, EEOC ranked 24th. The EEOC ranked 2nd in 
Employee Skills/Mission match in this report.
    Based on the ``2006 Federal Human Capital Survey'' conducted by the 
Office of Personnel Management, EEOC rated 21st on Job Satisfaction out 
of 36 agencies.
    Question. How many cases, on average, does a single EEOC 
investigator handle at the same time?
    Answer. Over the last 5\1/2\ years, the average workload per 
investigator based on end of year data has been approximately 40 
assigned charges. However, as the chart below indicates, during the 
period in question, the average workload has increased steadily from a 
low of 28 charges per investigator assigned in 2002 to a high of 63 at 
mid-year 2007.

----------------------------------------------------------------------------------------------------------------
                                                                  Pending End Inventory          Investigators
                                                            ---------------------------------      Assigned
                                                                                             -------------------
                                                               Total      ADR    Enforcement             Charges
                                                                                                Total      Per
----------------------------------------------------------------------------------------------------------------
2007 \1\...................................................    45,943     6,997      38,946        619        63
2006.......................................................    39,946     6,485      33,461        653        51
2005.......................................................    33,562     5,700      27,862        711        39
2004.......................................................    29,966     5,289      24,677        730        34
2003.......................................................    29,368     5,229      24,139        785        31
2002.......................................................    29,041     5,540      23,501        829        28
                                                            ----------------------------------------------------
Average....................................................    34,638     5,873      28,764        721        40
----------------------------------------------------------------------------------------------------------------
\1\ Mid-year data.

    Question. How many support personnel help a single investigator 
handle his or her cases?
    Answer. The number of support personnel varies from office to 
office depending on the on-board resources. Most field offices have an 
Investigator Support Assistant (ISA) on-board. See Attachment I for 
breakout of ISAs and other support personnel by office. The ISA 
performs a range of investigator-related duties that includes providing 
pre-charge counseling to potential charging parties. In some field 
offices, ISAs perfect charges received in the mail. Field support 
personnel also handle a large percentage of information calls from the 
public.

                                  ATTACHMENT I.--FIELD STAFFING--AS OF 5/16/07
----------------------------------------------------------------------------------------------------------------
                                                                                         Investigator
            District                         Office              Office   Investigators     Support     Support
                                                                 Total                       Assts       Staff
----------------------------------------------------------------------------------------------------------------
Atlanta.........................  Atlanta....................         75           35              4          10
                                  Savannah...................          9            5              1           2
                                                              --------------------------------------------------
      Atlanta Total.............  ...........................         84           40              5          12
                                                              ==================================================
Birmingham......................  Birmingham.................         67           25              4           9
                                  Jackson....................         26           14              2           6
                                  Mobile.....................          2            1              0   .........
                                                              --------------------------------------------------
      Birmingham Total..........  ...........................         95           40              6          15
                                                              ==================================================
Charlotte.......................  Charlotte..................         47           13              1           6
                                  Greensboro.................          8            5              0           1
                                  Greenville.................         11            6              0           2
                                  Norfolk....................         15            5              1           3
                                  Raleigh....................         18            7              0           4
                                  Richmond...................         17            6              0           2
                                                              --------------------------------------------------
      Charlotte Total...........  ...........................        116           42              2          18
                                                              ==================================================
Chicago.........................  Chicago....................         85           36              4          11
                                  Milwaukee..................         35           11              1           5
                                  Minneapolis................         17            6              1           4
                                                              --------------------------------------------------
      Chicago Total.............  ...........................        137           53              6          20
                                                              ==================================================
Dallas..........................  Dallas.....................         64           21              2          10
                                  El Paso....................         16           10              0           2
                                  San Antonio................         50           20              1           5
                                                              --------------------------------------------------
      Dallas Total..............  ...........................        130           51              3          17
                                                              ==================================================
Houston.........................  Houston....................         67           27              0           9
                                  New Orleans................         36           11              2           6
                                                              --------------------------------------------------
      Houston Total.............  ...........................        103           38              2          15
                                                              ==================================================
Indianapolis....................  Cincinnati.................         14            7    ............          2
                                  Detroit....................         40           16              1           5
                                  Indianapolis...............         73           30              2          11
                                  Louisville.................         19            8              1           4
                                                              --------------------------------------------------
      Indianapolis Total........  ...........................        146           61              4          22
                                                              ==================================================
Los Angeles.....................  Fresno.....................          3            1              0   .........
                                  Honolulu...................          7            3              0           1
                                  Las Vegas..................          6            2              0           1
                                  Los Angeles................         56           15              1           8
                                  San Diego..................         12            5              0           2
                                                              --------------------------------------------------
      Los Angeles Total.........  ...........................         84           26              1          12
                                                              ==================================================
Memphis.........................  Little Rock................         24           12              0           3
                                  Memphis....................         46           13              0           8
                                  Nashville..................         21           11              1           3
                                                              --------------------------------------------------
      Memphis Total.............  ...........................         91           36              1          14
                                                              ==================================================
Miami...........................  Miami......................         72           32              2           7
                                  San Juan...................          9            4              1           2
                                  Tampa......................         28           16              1           5
                                                              --------------------------------------------------
      Miami Total...............  ...........................        109           52              4          14
                                                              ==================================================
New York........................  Boston.....................         20            7              1           4
                                  Buffalo....................         10            7              0           2
                                  New York...................         72           20              1          10
                                  Newark.....................         14            6              1           4
                                                              --------------------------------------------------
      New York Total............  ...........................        116           40              3          20
                                                              ==================================================
Philadelphia....................  Baltimore..................         44           13              2           7
                                  Cleveland..................         48           14              3           9
                                  Philadelphia...............         64           21              0           8
                                  Pittsburgh.................         23           12              2           4
                                                              --------------------------------------------------
      Philadelphia Total........  ...........................        179           60              7          28
                                                              ==================================================
Phoenix.........................  Albuquerque................         20            8              2           4
                                  Denver.....................         45           14              1           7
                                  Phoenix....................         58           21              1           9
                                                              --------------------------------------------------
      Phoenix Total.............  ...........................        123           43              4          20
                                                              ==================================================
San Francisco...................  Oakland....................          3            2              1           1
                                  San Francisco..............         53           10              1           6
                                  San Jose...................         10            4              1           2
                                  Seattle....................         40           12              2           6
                                                              --------------------------------------------------
      San Francisco Total.......  ...........................        106           28              5          15
                                                              ==================================================
St. Louis.......................  Kansas City................         19           10              1           2
                                  Oklahoma City..............         20           11              1           3
                                  St. Louis..................         40           15              1           6
                                                              --------------------------------------------------
      St. Louis Total...........  ...........................         79           36              3          11
                                                              ==================================================
Washington......................  Washington.................         32            4              4           8
                                                              ==================================================
      Field Total...............  ...........................      1,730          650             60         201
----------------------------------------------------------------------------------------------------------------

    Question. How many front-line staff do you have in each area office 
to take initial complaints?
    Answer. The chart in Attachment I provides an office-by-office 
breakout of the numbers of investigators, ISAs and support staff, all 
of whom may perform charge intake duties. The chart also reflects the 
overall total staff (both enforcement and legal) for each office.
    Question. Can you provide the Committee with a strategic plan that 
includes benchmarks for reducing EEOC's backlog and improving morale? 
(OCH)
    Answer. A copy of our current strategic plan (2007-2012) is 
attached. Many of the measures contained in that plan are to be 
determined. A revised strategic plan with specific performance measures 
is currently under development and will be voted on by the Commission 
when completed. We will of course share our plan with you when it is 
completed and approved.
    With regard to employee morale, as part of our current strategic 
plan we are improving our strategic management of human capital. The 
EEOC has completed key steps toward developing and implementing a human 
capital initiative. Planning for human capital needs is more important 
than ever. Our human capital strategic plan guides our agency's 
actions, including:
  --Revising our performance management system for executives and 
        managers to link their performance with the agency's mission 
        and goals.
  --Developing and sustaining leadership and supporting succession 
        planning through the agency's Management Development Institute, 
        an umbrella program addressing managerial needs of supervisors 
        and executives.
  --Participating in the Office of Personnel Management's human capital 
        surveys and implementing regular internal surveys to identify 
        employee satisfaction with human capital management and 
        developing action plans based on an analysis of feedback.
  --Identifying and quantifying mission critical competencies for key 
        positions, including investigators, attorneys and mediators, 
        developing multi-year training plans to address any 
        organizational gaps.
  --Closing gaps through individual development plans, mentoring, 
        training, rotational assignments and other staff development 
        initiatives.
  --Aggressively recruiting, developing and retaining high-quality 
        talent.
    The EEOC's program to reinvigorate our systemic discrimination 
program highlights the need to fine tune our human capital approaches. 
To succeed, the agency must enhance incentives for identifying, 
investigating, and litigating systemic cases, provide additional 
opportunities for training and the development of expertise related to 
systemic discrimination, and improve technology skills. Our systemic 
initiative will facilitate development of more refined approaches to 
enforcing the law. Our goal is to ensure that employees have the right 
skills, talents, and abilities to succeed in implementing this program.
                     eeoc oversight of eeo offices
    Question. How does EEOC evaluate each equal employment office?
    Answer. The standards by which EEOC evaluates the sufficiency of 
federal agency Title VII and Rehabilitation Act programs are set forth 
in EEO Management Directive 715, which became effective in 2003. MD-715 
divides the essential elements of model agency EEO programs into six 
broad categories: (1) demonstrated commitment from agency leadership; 
(2) integration of EEO into the agency's strategic mission; (3) 
management and program accountability; (4) proactive prevention of 
unlawful discrimination; (5) efficiency; and (6) responsiveness and 
legal compliance.
    Pursuant to MD-715, agencies are required to conduct periodic self-
assessments of their Title VII and Rehabilitation Act programs against 
the six model elements enumerated above. Agencies are required to 
report on a yearly basis to EEOC their progress toward establishing and 
maintaining a model workplace. That report includes the identification 
of any program deficiencies and the identification of any barriers to 
equal employment an agency has discovered along with plans to eliminate 
any such barriers. Agencies also are required to submit to EEOC a 
series of data tables showing snapshots of their agency workforce by 
race, national origin, sex and targeted disability. EEOC evaluates each 
agency's submission and provides written feedback and analysis on each 
agency's progress toward establishing and maintaining a model EEO 
workplace and identifies areas in which each agency's program needs 
improvement.
    In addition to the written evaluations based upon agencies' MD-715 
reports, EEOC conducts a limited number of in-depth, program 
evaluations each year.
    Question. How often are evaluations conducted?
    Answer. Evaluations based upon agencies' MD-715 reports are 
conducted each year. EEOC also conducts more in-depth evaluations of 
agency EEO programs. EEOC conducted 3 such evaluations in fiscal year 
2004; 5 in fiscal year 2005; and 4 in fiscal year 2006. We plan to 
conduct 3 to 4 evaluations in fiscal year 2007.
    Question. What can a federal employee do if he or she feels that 
the agency EEO office is not investigating the case properly?
    Answer. There are several options available to a federal employee 
who feels that his or her complaint is not being properly processed. 
These options include raising these concerns with: (1) the agency 
officials responsible for conducting the investigation; (2) an EEOC 
Administrative Judge; and (3) the EEOC on appeal.
    Complaints concerning the processing of complaints, including how 
complaints are investigated, are addressed in the U.S. Equal Employment 
Opportunity Commission (EEOC) Management Directive (MD) 110. 
Specifically, MD-110 Chapter 5 Section IV.D entitled ``Allegations of 
Dissatisfaction Regarding the Processing of Pending Complaints,'' 
provides that if a complainant is dissatisfied with the processing of 
his/her pending complaint, whether or not it alleges prohibited 
discrimination as a basis for dissatisfaction, s/he should be referred 
to the agency official responsible for the quality of complaints 
processing.
    Agency officials should earnestly attempt to resolve 
dissatisfaction with the complaints process as early and expeditiously 
as possible. Further, the agency official responsible for the quality 
of complaints processing must add a record of the complainant's 
concerns and any actions the agency took to resolve the concerns to the 
complaint file maintained on the underlying complaint. If no action was 
taken, the file must contain an explanation of the agency's reason(s) 
for not taking any action.
    In cases where the complainant's concerns have not been resolved 
informally with the agency, the complainant may present those concerns 
to the EEOC at either of the following stages of processing: (a) Where 
the complainant has requested a hearing, to the EEOC Administrative 
Judge when the complaint is under the jurisdiction of the 
Administrative Judge; or (b) Where the complainant has not requested a 
hearing, to the EEOC Office of Federal Operations (OFO) on appeal.
    Where the Administrative Judge or OFO finds that an agency has 
improperly processed the original complaint and that such improper 
processing has had a material effect on the processing of the original 
complaint, the Administrative Judge has the authority to supplement the 
record at the hearing stage, and/or impose sanctions on the agency as 
s/he deems appropriate.
    In some instances, if there appears to a particularly egregious or 
systemic issue with a particular agency, which may have been identified 
by multiple complaints received through complainant correspondence, 
and/or through our independent review of their policies, practices, and 
procedures as revealed by their annual 462 and MD-715 reports, the EEOC 
may select the agency for a Program Evaluation. This evaluation 
involves an intensive review of the agency's EEO practices after which 
we prepare a report documenting our findings on the factors that we 
determine are having a significant impact on the agency's program 
efficiency as well as EEOC's recommendations on how the agency should 
address these findings. Similarly, on occasion, if a complaint presents 
a conflict of interest, or if high-level agency officials are involved, 
the EEOC's Special Services Staff in its Office of Federal Operations 
may undertake an investigation of a complaint if requested by the 
agency where the discrimination allegedly occurred.
    Finally, federal employees or applicants who are not satisfied with 
the outcome of the administrative process may elect to file a civil 
action in an appropriate United States District Court.
                            brac in maryland
    Question. Maryland over the next five years will be undergoing 
tremendous growth due to BRAC. Did EEOC consider this when they decided 
to downgrade the Baltimore office?
    Answer. EEOC was aware of the BRAC recommendations at the time that 
the repositioning plan was developed. EEOC regularly monitors its 
workload and staffing data, both at the national and at the local 
office levels, to identify any shifts or trends in charge receipts and 
resolutions from projected expectations. This monitoring allows us to 
develop needed adjustments to workload through the inter-district 
transfer of charges in the short term and, subject to budgetary 
constraints, by adjusting office staffing levels for the long-term. 
With respect to the Baltimore office, we have been keeping their front-
line staff at close to an optimal level, which should allow them to 
take on additional work resulting from base build-ups in Maryland. In 
January 2006, when we implemented field repositioning, there were 11 
investigators in the Baltimore District Office. Today, we have 12 
investigators in the Baltimore Field Office. The redesignation of the 
Baltimore office as a result of repositioning did not result in fewer 
frontline positions.
    Question. How will EEOC handle this influx of 55,000 new employees 
to Maryland?
    Answer. See response to question 1 above.
    Question. What is EEOC doing right now to plan for this increased 
caseload?
    Answer. See response to question 1 above.
                                 ______
                                 
               Questions Submitted by Senator Tom Harkin
    Question. What percentage of the EEOC cases that have been resolved 
or closed in the last three years originated with the state and local 
agencies?
    Answer. Over the last three years, the state and local agencies 
(FEPAs) have resolved approximately 40 percent of the total combined 
resolutions of dual-filed charges with EEOC and the FEPAs. 
Specifically, the FEPA percentage of overall dual-filed charge 
resolutions during this period was: 40 percent in fiscal year 2004, 
41.3 percent in fiscal year 2005 and 40.5 percent in fiscal year 2006.
    Question. What percentage of callers to the national call center's 
800 number are referred to state and local offices?
    Answer. Slightly less than 2 percent of NCC calls are referred to 
FEPAs. For example, of the 222,350 calls handled by customer service 
representatives during the 7-month period between October 2006 to April 
2007, 4,162 (1.9 percent) were referred to FEPAs.
    Question. Please provide a justification for the agency proposal to 
place over 60 percent of the cuts proposed by the Administration on the 
state and local agencies that have the largest share of the caseload.
    Answer. For fiscal year 2008, the Administration has proposed a 
$997,000 reduction from the fiscal year 2007 enacted level. From the 
enacted 2007 level, the State and local agencies were apportioned $30 
million in 2007 and will receive $28 million (a budget reduction of 
less than 7 percent) under the Administration budget before Congress. 
The budget projections show the EEOC inventory to rise to 67,000 
charges, while the FEPA charge inventory has been dropping and will 
flatten out at around 50,000 charges. The budget proposal seeks to 
provide more funds to EEOC to avoid a worsening EEOC inventory rise. 
The cut in FEPA funds should not change the projected FEPA inventory.
                                 ______
                                 
             Questions Submitted by Senator Lamar Alexander
    Question. How many lawsuits and complaints against employers over 
English language workplace policies has the U.S. Equal Employment 
Opportunity Commission (EEOC) filed so far this year? How many lawsuits 
and complaints did the Commission file in 2006, 2005, 2004, 2003, 2002, 
and 2001?
    Answer.
Charges
    In the period of fiscal year 2001 to fiscal year 2006, EEOC has 
received charges alleging discrimination on the issue of English-only 
policies as follows:

                                     CHARGE RECEIPTS WITH ENGLISH-ONLY ISSUE
----------------------------------------------------------------------------------------------------------------
                                                                                   Fiscal Year--
                                                                 -----------------------------------------------
                                                                   2001    2002    2003    2004    2005    2006
----------------------------------------------------------------------------------------------------------------
Receipts........................................................     154     237     173     184     141     125
----------------------------------------------------------------------------------------------------------------

    On average, this represents an average of 169 charge receipts per 
year, which equals less than 0.2 percent of receipts (using an average 
of 75,000), a small fraction of our total receipts. Additionally, we 
resolved the following number of charges during this same timeframe:

                                   CHARGE RESOLUTIONS WITH ENGLISH-ONLY ISSUE
----------------------------------------------------------------------------------------------------------------
                                                                                   Fiscal Year--
                                                                 -----------------------------------------------
                                                                   2001    2002    2003    2004    2005    2006
----------------------------------------------------------------------------------------------------------------
Resolutions.....................................................     182     218     190     165     189     111
----------------------------------------------------------------------------------------------------------------

    Of these resolutions, EEOC found reasonable cause to believe 
discrimination occurred in approximately 53 charges, on average, per 
fiscal year. The specific numbers, by fiscal year, are as follows:

                                    CAUSE RESOLUTIONS WITH ENGLISH-ONLY ISSUE
----------------------------------------------------------------------------------------------------------------
                                                                                   Fiscal Year--
                                                                 -----------------------------------------------
                                                                   2001    2002    2003    2004    2005    2006
----------------------------------------------------------------------------------------------------------------
Cause Resolutions...............................................      59      62      39      47      83      25
----------------------------------------------------------------------------------------------------------------

Lawsuits
    EEOC has filed one case this fiscal year involving English-only 
policies. In prior fiscal years, EEOC has filed the following cases 
involving this issue:

                                   LITIGATION FILINGS WITH ENGLISH-ONLY ISSUE
----------------------------------------------------------------------------------------------------------------
                                                                                   Fiscal Year--
                                                                 -----------------------------------------------
                                                                   2001    2002    2003    2004    2005    2006
----------------------------------------------------------------------------------------------------------------
Filings.........................................................       3       2       2       2       4       2
----------------------------------------------------------------------------------------------------------------

    Question. How much money has the EEOC spent to prosecute lawsuits 
and file complaints against employers over English language workplace 
policies so far this year (including staff costs, court fees, etc.)? 
How much did the Commission spend on lawsuits and complaints in such 
cases in 2006, 2005, 2004, 2003, 2002, and 2001?
    Answer.
Charges
    Of the 169 charge receipts that EEOC receives on average each year, 
the cost of processing these charges is difficult to quantify. However, 
basing our calculations on this six-year average for receipts, these 
charges represent the annual workload of approximately 1\1/2\ 
investigators. Computing out the annual salary, benefits and overhead 
for an investigator, and calculating their time spent on English-only 
charges, the cost would be approximately $250,000.
Lawsuits
    The table below provides cost to EEOC for litigating English-only 
cases.

                                                         LITIGATION COST FOR ENGLISH-ONLY ISSUE
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                     Fiscal Year--
                                                              ------------------------------------------------------------------------------------------
                                                                   2001         2002         2003         2004         2005         2006         2007
--------------------------------------------------------------------------------------------------------------------------------------------------------
Staffing Cost................................................    $6,515.00   $35,394.00   $38,038.00    $7,103.00  $130,804.00  $105,786.00   $54,793.00
Litigation Cost..............................................  $123,026.78   $71,432.00   $24,435.00   $87,062.00   $14,098.63      $399.00  ...........
                                                              ------------------------------------------------------------------------------------------
      Total..................................................  $129,542.78  $106,826.00   $62,473.39   $94,165.69  $144,902.63  $106,185.00   $54,793.00
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Question. How many small-to-medium sized businesses (under 100 
employees) has the EEOC filed complaints or lawsuits against over 
English language workplace policies this year? How many in 2006, 2005, 
2004, 2003, 2002, and 2001? How many big businesses (100 or more)? How 
many of each category in Tennessee?
    Answer.
Charges
    Of the cause findings issued each year during the past six years, 
the number of those that were issued by the size of the employer is as 
follows:

                           CAUSE RESOLUTIONS WITH ENGLISH-ONLY ISSUE BY EMPLOYER SIZE
----------------------------------------------------------------------------------------------------------------
                                                                                   Fiscal Year--
                                                                 -----------------------------------------------
                                                                   2001    2002    2003    2004    2005    2006
----------------------------------------------------------------------------------------------------------------
Total Cause Resolutions.........................................      59      62      39      47      83      25
15-100 Employees................................................      16      14      14      21      19      11
101-500 Employees...............................................      20      27      13       8      20       5
501+ Employees..................................................      23      19      11      14      39       6
No. of Employees Unknown........................................  ......       2       1       4       5       3
----------------------------------------------------------------------------------------------------------------

    During this six-year period, there were only three cause findings 
issued to employers in the State of Tennessee. All of these findings 
were issued in a single fiscal year, fiscal year 2001, and were evenly 
split between the three size categories above.
Lawsuits
    EEOC has not filed any cases this fiscal year against small 
employers involving this issue. For prior fiscal years, we have filed 
the following:

            LITIGATION FILINGS WITH ENGLISH-ONLY ISSUE AGAINST EMPLOYERS WITH 100 OR FEWER EMPLOYEES
----------------------------------------------------------------------------------------------------------------
                                                                                   Fiscal Year--
                                                                 -----------------------------------------------
                                                                   2001    2002    2003    2004    2005    2006
----------------------------------------------------------------------------------------------------------------
Filings.........................................................  ......       2       1  ......       2       1
----------------------------------------------------------------------------------------------------------------

    EEOC has filed one case this year against a large employer. In the 
past, we have filed the following:

            LITIGATION FILINGS WITH ENGLISH-ONLY ISSUE AGAINST EMPLOYERS WITH MORE THAN 100 EMPLOYEES
----------------------------------------------------------------------------------------------------------------
                                                                                   Fiscal Year--
                                                                 -----------------------------------------------
                                                                   2001    2002    2003    2004    2005    2006
----------------------------------------------------------------------------------------------------------------
Filings.........................................................       3  ......       1       2       2       1
----------------------------------------------------------------------------------------------------------------

    EEOC has filed no cases against employers in Tennessee involving 
this issue for the period October 1, 2000 to the present.
    Question. How many lawsuits and complaints arising over English 
language workplace policies has the EEOC settled, won, and lost this 
year? How many in 2006, 2005, 2004, 2003, 2002, and 2001?
    Answer.
Charges
    The number of English-only policy resolutions involving settlements 
include successful conciliations--a component of the cause finding--as 
well as settlements. The annual tallies follow:

                                       SETTLEMENTS WITH ENGLISH-ONLY ISSUE
----------------------------------------------------------------------------------------------------------------
                                                                                   Fiscal Year--
                                                                 -----------------------------------------------
                                                                   2001    2002    2003    2004    2005    2006
----------------------------------------------------------------------------------------------------------------
Successful Conciliations........................................      23      22       7      16      25       6
Settlements.....................................................      13      28      26      20      14      18
                                                                 -----------------------------------------------
      Total.....................................................      36      50      33      36      39      24
----------------------------------------------------------------------------------------------------------------

Lawsuits
    EEOC has resolved three cases this fiscal year; all were settled by 
consent decree. In prior years, we resolved the following:

                                 LITIGATION RESOLUTIONS WITH ENGLISH-ONLY ISSUE
----------------------------------------------------------------------------------------------------------------
                                                                                   Fiscal Year--
                                                                 -----------------------------------------------
                                                                   2001    2002    2003    2004    2005    2006
----------------------------------------------------------------------------------------------------------------
Consent Decree..................................................       4       1  ......       1       1       3
Settlement Agreement............................................  ......       1       1  ......  ......  ......
Favorable Court Order...........................................  ......  ......  ......  ......       1  ......
                                                                 -----------------------------------------------
      Total.....................................................       4       2       1       1       2       3
----------------------------------------------------------------------------------------------------------------

                                 ______
                                 
               Questions Submitted by Senator Ted Kennedy
    Question. I understand that EEOC has undertaken a commitment to 
revitalize systemic litigation. I applaud this effort. However, in 
light of your significant and growing case backlog and the significant 
staff reductions the agency has undergone in recent years, do you 
believe that the Commission has the resources to implement this renewed 
commitment? What other areas will the Commission have to compromise in 
this effort?
    Answer. We believe that in order to combat systemic discrimination 
effectively, the Commission must promote a culture that encourages 
staff to look for, recognize, and investigate systemic discrimination. 
We already have a core group of investigators, attorneys and other 
enforcement staff who have a proven record in this area including many 
significant settlements and conciliations over the years, and in some 
instances, major systemic litigation. We are enhancing this core group 
by adding positions for lead systemic investigators, systemic paralegal 
specialists, and labor economists to support this effort. In addition, 
we are devoting resources to systemic training programs to develop and 
enhance the expertise of existing investigators, attorneys and support 
staff.
    We are able to leverage our existing resources by encouraging 
districts to partner with one another and form a national systemic 
practice along the lines of a national law firm model. This strategy 
allows the Commission to address systemic discrimination effectively 
nationwide while at the same time sharing and building expertise in all 
of our offices.
    We budgeted $213,000 in fiscal year 2006 non-staff funds for 
information technology support for this activity. In fiscal year 2007, 
we have budgeted $150,000 for non-staff costs in the field for this 
activity. The funds were realized when planned new hires did not enter 
on duty within the new hire timeline. These funds will be used to hire 
expert and support services for manipulating systemic data, train staff 
in systemic analysis, and pay for travel expenses for staff to meet on 
systemic cases that involve multiple offices.
    Specifically, in our budget request, we project a slight decrease 
in lawsuit filings compared to previous years, due to a readjustment of 
our docket to include more large class cases. In fiscal year 2006, we 
filed 371 suits, and in fiscal year 2008 we estimate filing 340 suits. 
We anticipate a shift in the size and complexity of cases in our docket 
as the Commission's new Systemic Program produces some larger cases for 
enforcement litigation by fiscal year 2008. Our campaign to 
reinvigorate the systemic program may redirect some resources from 
smaller, individual cases. The Commission understands this potential 
trade-off and believes that it is worthwhile. When done correctly, 
systemic cases can transform whole industries or geographic areas--not 
just the named defendants. They are a way of leveraging the agency's 
limited resources to have the widest possible reach. Thus, we believe 
the Commission has the resources to implement its renewed commitment to 
systemic litigation, without compromising its overall enforcement 
program.
    Question. The National Employment Lawyers Association recently 
released a report containing disturbing findings from a survey that the 
Association conducted about EEOC operations. I was particularly 
troubled by the report's discussion of the problems that members of the 
public have experienced with intake investigations. Potential claimants 
are receiving erroneous advice--e.g., that they cannot file a claim if 
they still have their job, or that they cannot name more than one 
grounds of discrimination in their charge--and this bad advice has 
compromised their rights. In addition, the agency's recent 
reorganization significantly reduced the number of frontline staff, 
particularly intake investigators. You testified at the hearing that 
EEOC's frontline investigators receive only one week of specialized 
training. I know that the agency's employees are dedicated and 
hardworking, but it appears that they do not have the capacity or the 
training to perform their jobs effectively. What steps can the agency 
take to increase the quality of frontline services it provides? Does 
the agency need to implement additional training programs? Do you need 
to hire more frontline investigative staff? How can the quality of 
services be improved without additional resources above and beyond the 
President's budget request?
    Answer. First, I would like to note that when I became Chair in 
September 2006, I met with NELA representatives almost immediately, 
with the goal of beginning a close partnership with them in my new 
role. Since last September, I have maintained an on-going dialogue with 
NELA on many matters and spent two days with NELA representatives at 
the ABA off-the-record meeting in January of this year. As NELA itself 
states in the introduction to its report:

    ``The Chair and the Commissioners have taken affirmative steps in 
seeking NELA's input and feedback regarding EEOC operations. Indeed, 
open dialogue with and encouragement from Chair Earp, Vice Chair 
Silverman, and Commissioners Griffin and Ishimaru were a catalyst for 
NELA conducting the survey which is the subject of this report.''

    Second, I would like to reassure the Committee that the instances 
recounted in NELA's report are not the usual conduct of business at 
EEOC. The survey was sent to 2,500 NELA members with the request that 
they report problems with EEOC rejecting charges. Of those 2,500, 343, 
or 13.7 percent responded. A total of 77, or 3 percent of the members 
surveyed reported drafting a ``discrimination charge . . . that was not 
accepted for filing . . . .'' NELA's survey covered approximately two 
and a quarter calendar years; although our numbers follow fiscal years, 
instead of calendar years, they provide context to consider the numbers 
of complaints that NELA received. During fiscal year 2004-fiscal year 
2006, EEOC received more than a half million inquiries (558,177) and 
took in over a quarter of a million charges (230,628). In light of this 
enormous workload, the instances reported are indeed a small number.
    I want to emphasize that I take NELA's concerns very seriously. As 
a result of discussions with them on intake issues, long before we 
received the survey results, we began setting up an e-mail address to 
enable NELA members to inform us in real time of concerns they have 
with any particular intake session. We notified NELA informally of this 
e-mail address in February and in April formally notified them in a 
letter which they can distribute to their members. We intend to use the 
information provided by NELA members to remedy any situation where an 
individual who wishes to file a charge has encountered obstacles, as 
well as to train and counsel staff on correct intake procedures, when 
necessary. As we receive messages in this mailbox, we will be working 
with the appropriate office to resolve the situation promptly, ensure 
that charging party rights are preserved and that our staff deals 
properly with anyone who initiates intake activity.
    We have also found that face-to-face meetings with stakeholders 
such as NELA are extremely helpful to both sides. For example, when 
NELA representatives in Atlanta informed us in 2005 of problems they 
encountered with filing charges in the Atlanta District Office, our 
Atlanta District Director met with them personally to resolve those 
issues. She then set up quarterly meetings with regional NELA 
representatives, which are on-going to this day. We understand that 
these meetings are well received on both sides and we have encouraged 
our other district directors across the country to meet regularly with 
their regional NELA representatives.
    Of course, there are reasonable differences that our staff have had 
from time to time with charges drafted by private attorneys and some 
charges are reworked. For example, we routinely request that charges 
not include the specific disability on the face of the charge. The 
Americans with Disabilities Act limits the extent to which employers 
can disclose the medical information of employees. Charges are served 
on employers and may go through many hands and be seen by many people 
at the company. We would not want our charge process to produce results 
inconsistent with the statute. Another example is the honest mistake 
that some private attorneys make by naming witnesses to the alleged 
discrimination on the face of the charge. If such charges were taken 
``as-is'' and served on the employer, those witnesses could easily 
become targets for retaliation. Consequently, our staff request that 
the names of witnesses be removed from the charge and provided 
separately to investigators.
    Finally, you should know that EEOC has been working on maintaining 
the overall high quality of our intake process for several years, in 
part through Technical Assistance reviews that our headquarters staff 
conduct of our field offices. In 2005, we set up an Intake Workgroup, 
composed of deputy district directors and district enforcement 
managers, which drafted a proposed uniform intake questionnaire to 
assist the district offices with their intake procedures. We have also 
been working on redirecting staff resources to the intake function to 
allow better development of the allegations included in charges as well 
as the evidence necessary to support those allegations. We anticipate 
additional training for our intake staff sometime in the near future. 
This would augment the initial one-week classroom training provided to 
new investigators that is supplemented with local training conducted in 
each office, on-the- job training, and later advanced classroom 
training.
    We have already given NELA's report to our Technical Assistance 
teams for their review and analysis of the specific problems noted in 
the survey. We will use their recommendations to improve our processes 
as necessary and reduce any such occurrences in the future.
    Question. I am familiar with the findings of the Inspector 
General's report on the ineffectiveness of the Commission's call center 
pilot project. The center has been plagued with operational problems 
and is not serving the public effectively. Even if improvements have 
been made, it is clearly time to reexamine this problematic experiment. 
You have mentioned that there would be increased expense if this 
function were brought in-house, but your estimate of the cost seems 
extremely high. Can you provide for me the basis of your calculations 
about the cost of bringing the call center in-house? Wouldn't the 
Commission's client populations be better served by working with 
experienced EEOC employees when they contact the agency?
    Answer. In September 2006, EEOC asked the National Academy of 
Public Administration (NAPA) to conduct an assessment of the 
requirements to establish an in-house contact center and to provide an 
independent estimate of the costs. NAPA issued a report in January 2007 
that estimated that it would cost an initial $2.3 million to move the 
National Contact Center (NCC) in-house and annual ongoing costs of $5.5 
million; therefore, the first year of operating an in-house contact 
center would be $7.8 million. By comparison, annual on-going costs for 
the contractor-run center costs about $2.5 million. In developing their 
cost estimates, NAPA used comparable staffing, processes, technology, 
and equipment as that used by the NCC. The NAPA estimates took into 
account that the software application, knowledge base, and training 
materials used by the NCC are the property of EEOC under the terms of 
the contract and would not have to be purchased. According to the NAPA 
report, which is available at, ``the staffing estimates are based upon 
a representative month and the metrics currently in place to meet 
service requirements including speed of answer and qualitative 
measures.'' The NAPA estimates also presumed the rental of a stand-
alone facility located in a labor market designated as ``rest of USA.''
    It is important to note that the customer service representatives 
(CSRs) who answer the phones for EEOC are dedicated to the EEOC 
contract, are well-trained to represent EEOC and allow us to present a 
consistent face to the public for 12 hours each work day. This is an 
important service to our client population--to be accessible, at 
convenient hours, and providing accurate information or referrals. A 
report issued by the Claes Fornell International (CFI) Group in May 
2006 indicated the overall Customer Satisfaction Score for the EEOC 
contact center was 77, which is six points higher than the average for 
Federal Government contact centers. This report is accessible on the 
EEOC external website at the following URL: http://www.eeoc.gov/
abouteeoc/oig/reports/ncc/cs_survey.html. In addition, we receive very 
few complaints from our field offices regarding the services provided 
by the contact center. The volume of calls handled by the CSRs, more 
than 38,000 a month (with an average wait time of 30 seconds), could 
not be handled using existing experienced EEOC employees and 
technology.
    A March 2003 survey indicated that 61 percent of the calls to our 
public numbers in the field were for reasons other than potential 
charge filing and could easily be answered by clerical level employees. 
These figures still hold true today in that more than 60 percent of the 
calls coming to the NCC are for reasons other than filing a charge. 
Callers who have questions about filing a charge are pre-screened for 
coverage and mailed an intake questionnaire. Contact center employees 
have been trained to handle the variety of calls coming in to EEOC and 
our EEOC monitors believe they are doing a very good job of collecting 
data, answering questions, and as several field supervisors noted 
recently, ``providing a portal to EEOC.'' The training for customer 
service representatives does not end after the initial two weeks 
(including six days devoted to EEOC content) and also includes on-going 
monitoring and refresher training at least four times each month. The 
CSR's job is to be quickly accessible, to quickly determine the reason 
for the call, and to provide the appropriate level of assistance. Do 
they use scripts to do this? Yes, they do, but they are trained to ask 
appropriate questions to determine which scripts to use and when. These 
same scripts have been shared with all field offices at the request of 
field supervisors. CSRs hold a dialogue with the caller and because 
they are constantly monitored, we are able to follow up on any 
incomplete or incorrect information.
    In order to set up an EEOC-operated contact center, we will have to 
make a significant investment in technology and additional resources to 
provide the same level of service the public is receiving from the 
contract call center. When we used only EEOC employees answering the 
phone, we found we could not adequately do the job without using some 
21st century technology and strategies. Our volume of calls, currently 
over 60,000 per month to the NCC alone, is clear evidence that we need 
to take advantage of industry best practices to meet our customer 
service needs. It is better for our customers that we are making the 
best use of our limited budgetary resources to operate a contract call 
center, because in this way:
  --the caller can be certain of reaching a CSR 12 hours-a-day and only 
        having to wait less than a minute on average to do so;
  --the caller can be assured of getting consistent information, 
        consistent treatment, and consistent service, regardless of 
        whether he or she resides in the country, or what language he 
        or she speaks; and
  --our investigators are able to devote their time to deal with 
        potential charges and investigations rather than handling phone 
        duty of general inquiries, which currently number 60,000 per 
        month.

                         CONCLUSION OF HEARINGS

    Senator Mikulski. We'll look forward to further 
conversations with you as we move ahead. This subcommittee will 
stand in recess, subject to the call of the Chair.
    [Whereupon, at 11:36 a.m., Thursday, May 3, the hearings 
were concluded, and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]




















  COMMERCE, JUSTICE, SCIENCE, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2008

                              ----------                              

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.

                       NONDEPARTMENTAL WITNESSES

    [The following testimonies were received by the 
Subcommittee on Commerce, Justice, Science, and Related 
Agencies for inclusion in the record. The submitted materials 
relate to the fiscal year 2008 budget request for programs 
within the subcommittee's jurisdiction.]
   Prepared Statement of the National Employment Lawyers Association
                           executive summary
    In March of this year, the National Employment Lawyers Association 
\1\ (NELA) prepared and distributed to its membership a brief on-line 
survey to gain a better and more current understanding of (1) the 
frequency with which charging parties and/or their attorneys encounter 
refusals by the U.S. Equal Employment Opportunity Commission (EEOC) to 
accept charges; and (2) the extent to which charging parties and/or 
their attorneys experience other problems with charge filing at the 
EEOC (see Appendix A attached to the full report). NELA spearheaded the 
survey in response to comments it regularly receives from NELA members 
and local NELA affiliate members about the EEOC's charge filing process 
as well as by our discussions with the leadership of the EEOC. Both the 
EEOC and the Congress also have recently expressed concerns about the 
need for charging parties to have effective access to the Commission's 
compliance procedures.
---------------------------------------------------------------------------
    \1\ The National Employment Lawyers Association (NELA) advocates 
for employee rights and workplace fairness while promoting the highest 
standards of professionalism, ethics and judicial integrity. NELA was 
founded in 1985 to provide assistance and support to lawyers in 
protecting the rights of employees against the greater resources of 
their employers and the defense bar. NELA is the country's largest 
professional organization that is comprised exclusively of lawyers who 
represent individual employees in cases involving employment 
discrimination, wrongful termination, employee benefits, and other 
employment-related matters. NELA and its 67 state and local affiliates 
have more than 3,000 members nationwide.
    As a group, NELA members have represented thousands of individuals 
seeking equal employment opportunities. NELA is one of a limited number 
of organizations dedicated to protecting the rights of all employees 
who rely on the U.S. Equal Employment Opportunity Commission (EEOC) and 
the courts for protection against illegal workplace discrimination. 
NELA's members serve the same constituency as the Commission, namely, 
employees who have been and are being subjected to invidious race, 
color, national origin, gender, religious, age, and disability 
discrimination prohibited by Title VII of the Civil Rights Act of 1964, 
the Age Discrimination in Employment Act, and the Americans with 
Disabilities Act. NELA's members interface with the EEOC on a daily 
basis. They are involved with the Commission's compliance procedures, 
its investigation practices, and its disposition of cases. That 
involvement is nationwide and reaches to all of EEOC's regional and 
district offices.
---------------------------------------------------------------------------
    The survey sought to elicit information about what happens when a 
charge is presented to the Commission--whether charging parties 
encounter problems, the types of problems they experience, and the 
frequency and timing of such problems. The survey covers the period 
from January 1, 2005 to April 2, 2007; questions were categorized by 
calendar year. The survey was conducted from March 16, 2007 through 
April 2, 2007. NELA received 343 unique responses to the survey, for a 
total response rate of 14 percent. The responses represent the 
experiences of plaintiff employment lawyers (and their clients) from 30 
states, the District of Columbia and Puerto Rico who practice before 
EEOC offices in every region, including 15 district, 9 field, 12 area 
and 11 local offices. (A list of the EEOC offices referenced by survey 
respondents is contained in Appendix B of the full report.)
    The cumulative responses reveal an agency that is resistant to the 
filing of employment discrimination charges. Of the survey respondents, 
nearly one-quarter (23 percent) indicated that they had drafted charges 
for clients that had not been accepted for filing by the EEOC during 
the twenty-seven month period covered by the survey.\2\ In response to 
the broader question, ``[H]ave you had other problems with the EEOC in 
the processing of charges or intake questionnaires (e.g., resistance by 
EEOC office identified above to accepting filing as prepared by you, 
substantial modification by EEOC of what you prepared, etc.)?''--the 
``yes'' response rate was even higher.\3\ Thirty-six percent (36 
percent) of respondents reported that they had encountered such 
problems at some time since January 1, 2005. Moreover, more than a 
quarter of the respondents who had experienced such problems did so 
more than once in calendar years 2005 (26 percent) and 2006 (28 
percent).\4\ In 2005, 12 percent, and in 2006, 13 percent, of them had 
encountered such problems three or more times in the year.\5\
---------------------------------------------------------------------------
    \2\ See Question 3, Appendix A.
    \3\ See Question 11, Appendix A.
    \4\ See Questions 12 and 13, Appendix A.
    \5\ Supra.
---------------------------------------------------------------------------
    The comments of survey respondents illuminate the pervasiveness of 
the problems that charging parties and plaintiff's attorneys have with 
the EEOC's intake, charge filing and investigation processes. The 
respondents cite several recurrent problems with EEOC charge intake as 
well as with EEOC investigations after charges are filed (see pages 6-
13 of the full report).
    These findings, as alarming as they are, do not come as a surprise 
to anyone who is familiar with the EEOC. They are, in substantial part, 
symptomatic and the consequence of an inadequate budget which has 
resulted in an understaffed agency burdened with a massive flow of 
charges and an ever growing backlog. Indeed, the Commission has 
struggled to meet the mounting pressures of this burden and has tried 
to adjust to the realities of its budget through a major reorganization 
and reallocation of staff.
    When the chaff is separated from the wheat, however, the key fact 
that emerges is that the EEOC has for many years only been able to 
budget a small amount of its funding to enforcement and virtually 
nothing to training personnel. This renders the Commission ill-equipped 
to achieve its mission, produces never-ending delays, prevents even 
minimal training of staff, and breeds inordinate pressures not to add 
to a burgeoning backlog by junking potential and actual cases at every 
step of the administrative process. More specifically, it produces an 
inherent resistance to the filing of charges by compliance staff, 
shortchanges investigations (if and when they take place), and 
increases an administrative ``washing of hands'' of cases through the 
convenience of boilerplate Notices of Right to Sue that include nothing 
but a mere check-off box for ``insubstantial evidence to determine'' 
discrimination.
    In enacting various anti-discrimination laws, Congress has signaled 
that addressing and eliminating invidious discriminatory employment 
practices is one of the nation's highest priorities. Thus, it is 
incumbent upon Congress to ensure that the Commission--the federal 
agency that it has mandated to enforce these laws--receives the 
necessary funding to rectify the untenable morass described in the 
report. If the EEOC is to overcome the dire consequences of past budget 
reductions, then funding well beyond the current levels must be made 
available.
    At the same time, the EEOC also must be held accountable to 
Congress and the public it serves. Thus, oversight and assessment 
mechanisms must be put into place to assure that additional resources 
are directed toward viable and meaningful enforcement of the EEOC's 
mandates (see page 15 of the full report). The findings cited in NELA's 
survey lend credence to the problems faced by the EEOC and those 
Americans the agency is mandated to protect from unlawful employment 
discrimination. For the EEOC to fulfill its mission as the federal 
agency most responsible for the enforcement of the nation's equal 
employment opportunity laws, these problems must, at a minimum, be 
addressed with more resources targeted at improving basic enforcement 
functions.
    For more information, contact Donna R. Lenhoff, Legislative & 
Public Policy Director, National Employment Lawyers Association, 1090 
Vermont Avenue, NW, Suite 500, Washington, DC 20005 (Tel: 202-898-2880; 
E-mail: [email protected]).
  workers' rights in jeopardy: eeoc's enforcement of equal employment 
             opportunity laws impeded by inadequate funding
a report by the national employment lawyers association--april 27, 2007
Introduction
    The National Employment Lawyers Association (NELA) advocates for 
employee rights and workplace fairness while promoting the highest 
standards of professionalism, ethics and judicial integrity. NELA was 
founded in 1985 to provide assistance and support to lawyers in 
protecting the rights of employees against the greater resources of 
their employers and the defense bar. NELA is the country's largest 
professional organization that is comprised exclusively of lawyers who 
represent individual employees in cases involving employment 
discrimination, wrongful termination, employee benefits, and other 
employment-related matters. NELA and its 67 state and local affiliates 
have more than 3,000 members nationwide.
    As a group, NELA members have represented thousands of individuals 
seeking equal employment opportunities. NELA is one of a limited number 
of organizations dedicated to protecting the rights of all employees 
who rely on the U.S. Equal Employment Opportunity Commission (EEOC) and 
the courts for protection against illegal workplace discrimination. 
NELA's members serve the same constituency as the Commission, namely, 
employees who have been and are being subjected to invidious race, 
color, national origin, gender, religious, age, and disability 
discrimination prohibited by Title VII of the Civil Rights Act of 1964, 
the Age Discrimination in Employment Act, and the Americans with 
Disabilities Act. NELA's members interface with the EEOC on a daily 
basis. They are involved with the Commission's compliance procedures, 
its investigation practices, and its disposition of cases. That 
involvement is nationwide and reaches to all of EEOC's regional and 
district offices.
    NELA members and the staff of the EEOC share the common goal of 
ensuring that the nation's equal employment opportunity laws are 
enforced as mandated by Congress. Indeed, several current and past EEOC 
staff are or have been members of NELA, including former Commissioners 
as well as senior attorneys in the Office of General Counsel and 
Regional Offices. These EEOC alumnae are passionate about their years 
at EEOC. They remain committed to helping the EEOC to advance its 
mission, to establish and develop a vibrant body of employment law, to 
address discrimination where it has operated and is continuing to be 
practiced, and to secure remedies for unlawful employment practices. In 
short, NELA and its members are uniquely positioned to comment upon 
EEOC's compliance efforts and the extent to which the Commission meets 
its mission, exercises its responsibilities, and provides relief to 
individuals who are discriminated against in the workplace.
    Effective, attentive and responsive enforcement procedures hold out 
the hope for resolution and relief for victims of workplace 
discrimination. By the same token, ineffective, inattentive and 
irresponsible administrative processing by EEOC precludes and/or 
directly impacts the nature and scope of the relief charging parties--
even those represented by attorneys--can obtain during the 
administrative process. Furthermore, because utilization of the 
Commission's administrative procedures is a mandatory gateway to 
private enforcement of Title VII and defines the scope of any ensuing 
litigation, NELA's members and their clients have a vital stake in 
ensuring charging party accessibility to the EEOC and effective 
compliance efforts.
    It is essential to underscore that EEOC leaders, especially its 
current Chair, have recognized this commonality between EEOC's 
responsibilities and the interests and experiences of NELA's members. 
They are acutely aware that working in partnership with NELA, as well 
as other stakeholders, is key to fulfilling the EEOC's mission of 
enforcing the nation's equal employment opportunity laws. The Chair and 
the Commissioners have taken affirmative steps in seeking NELA's input 
and feedback regarding EEOC operations. Indeed, open dialogue with and 
encouragement from Chair Earp, Vice Chair Silverman, and Commissioners 
Griffin and Ishimaru were a catalyst for NELA conducting the survey 
which is the subject of this report. The same is true with respect to a 
planned project that NELA hopes to implement in the near future 
regarding EEOC's National Contact Center.
The Survey and Methodology
    In March of this year, NELA prepared and distributed to its 
membership a brief on-line survey, a copy of which is attached as 
Appendix A. The purpose of the survey was to gain a better and more 
current understanding of: (1) the frequency with which charging parties 
and/or their attorneys encounter refusals by the EEOC to accept 
charges; and (2) the extent to which charging parties and/or their 
attorneys experience other problems with charge filing at the EEOC. 
NELA spearheaded the survey in response to comments it regularly 
receives from NELA members and local affiliate members about the EEOC's 
charge filing process as well as by our discussions with EEOC 
leadership. In addition, both the EEOC and the Congress have recently 
expressed concerns about the need for charging parties to have 
effective access to the Commission's compliance procedures.
    The survey sought to elicit information about what happens when a 
charge is presented to the Commission--whether charging parties 
encounter problems, the types of problems they experience, and the 
frequency and timing of such problems. The survey covers the period 
from January 1, 2005 to April 2, 2007; questions were categorized by 
calendar year.
    Instructions and a link to the on-line survey were sent by 
electronic mail to NELA members. In addition, NELA's sixty-seven state 
and local affiliate leaders were encouraged to forward the survey link 
to their membership (which include members who are not members of the 
national organization). The survey was conducted from March 16, 2007 
(the date it was first distributed) through April 2, 2007 (the date the 
survey was closed). NELA received 343 unique responses to the survey, 
for a total response rate of 14 percent.
    The responses represent the experiences of plaintiff employment 
lawyers (and their clients) from 30 states, the District of Columbia 
and Puerto Rico. The respondents practice before EEOC offices in every 
region, including 15 district, 9 field, 12 area and 11 local offices. 
(A list of the EEOC offices referenced by respondents is contained in 
Appendix B.)
The Findings
    The responses reveal an agency that is resistant to the filing of 
employment discrimination charges. Of the survey respondents, nearly 
one-quarter (23 percent) indicated that they had drafted charges for 
clients that had not been accepted for filing by the EEOC during the 
twenty-seven month period covered by the survey.\6\ In response to the 
broader question, ``[H]ave you had other problems with the EEOC in the 
processing of charges or intake questionnaires (e.g., resistance by 
EEOC office identified above to accepting filing as prepared by you, 
substantial modification by EEOC of what you prepared, etc.)?''--the 
``yes'' response rate was even higher.\7\ Thirty-six percent (36 
percent) of respondents reported that they had encountered some such 
problems at some time since January 1, 2005. Moreover, more than a 
quarter of the respondents who had experienced such problems did so 
more than once in calendar years 2005 (26 percent) and 2006 (28 
percent).\8\ In 2005, 12 percent, and in 2006, 13 percent, of them had 
encountered such problems three or more times in the year.\9\
---------------------------------------------------------------------------
    \6\ See Question 3, Appendix A.
    \7\ See Question 11, Appendix A.
    \8\ See Questions 12 and 13, Appendix A.
    \9\ Supra.
---------------------------------------------------------------------------
    These experiences were not specific to just one or two of EEOC's 
local offices, but involved, as mentioned above, 47 offices nationwide. 
These 47 EEOC offices are not, however, necessarily any worse than EEOC 
offices not reflected in the survey. On the other hand, the offices not 
on the list (Appendix B) are not necessarily any better than those that 
are on the list. Indeed, NELA has no reason to believe that these 47 
EEOC offices are either better or worse than the EEOC offices that were 
not mentioned by survey respondents.
    The comments of those responding to the survey, which are compiled 
in Appendix C, illuminate the pervasiveness of the problems that 
charging parties and plaintiff's attorneys have with the EEOC's intake, 
charge filing and investigation processes. As reflected below, the 
comments indicate several recurrent problems with EEOC charge intake as 
well as with EEOC investigations after charges are filed. This is not 
to suggest, however, that all is bad at the EEOC; in fact, some 
respondents recognized and complimented particular offices or 
personnel.
            Problems with Charge Intake
    While NELA attorneys, more often than not, succeed in filing 
charges for their clients, they report that these same clients in many 
instances were previously turned away by EEOC's intake personnel based 
on the same alleged incidents of discrimination. For example:
  --Our clients who come to [us] after going to the EEOC have numerous 
        horror stories about being told they couldn't file because they 
        still had their job, didn't have a case, etc.----Comment 16 
        (Atlanta)
  --While I have not had problems with the EEOC accepting my charges or 
        questionnaires, I have had many potential clients report that 
        the EEOC would not accept their charges--at least 4 in the past 
        two months. I cannot say how many have reported this since 
        January 2005, but the numbers seem to be increasing of late. In 
        addition, the EEOC does not want any information before the 180 
        day filing period, whether or not this information is relevant 
        to the discrimination claims in the charge.----Comment 118 
        (Atlanta)
  --Because of previous problems with the EEOC I always draft the 
        charges and have them hand delivered and stamped. I stopped 
        sending my clients in to file on their own behalf because the 
        EEOC . . . tell[s] clients they don't have a case even though I 
        have already determined that they do.----Comment 45 (Chicago)
  --[T]he problem seems to be mainly with people who attempt to file 
        charges without an attorney. I get many, many calls from people 
        who say that the EEOC told them that they do not have a case 
        when in fact they do have one, or would have if they had filed 
        the charge when they contacted EEOC. EEOC gave them bad legal 
        advice which caused them not to file when they should have, and 
        their rights were compromised.----Comment 86 (Dallas)
  --I don't have problems . . . It is the unrepresented people who have 
        problems. For instance, I have had people come to see me who 
        have been told by the intake folks that they don't have a case 
        and don't know they can insist on filing a charge. I draft and 
        file the charge and there is no problem. I really worry about 
        the folks who don't have a lawyer, not the ones who do!!----
        Comment 175 (St. Louis)
  --[A]ggrieved individuals go [to the EEOC and] are often told that 
        they have no case and no charges are accepted. How many people 
        with legitimate claims then exit the process, demoralized? If 
        they come to us, we have to fight to get the charges filed, 
        including writing them ourselves (which I have not had rejected 
        but never results in much of an investigation).----Comment 99 
        (Detroit)
    Often, before accepting a charge (even one prepared by an 
attorney), EEOC intake personnel have required that the charge be 
narrowed (for example, to one incident or to one form of 
discrimination, such as gender or race discrimination but not both). 
For example:
  --Refusal to allow charging party to check more than one box; refusal 
        to allow charging party to name employment agency or joint 
        employer; not allowing charging party to mention events outside 
        180 days on the face of the charge; telling charging party she 
        doesn't have a charge and not letting her file.----Comment 173 
        (Atlanta); see also Comment 84 (Dallas)
  --[T]he EEOC often will not include all claims (even when client has 
        been instructed by me as to what claims).----Comment 45 
        (Chicago)
    The EEOC resists accepting charges, primarily due to untrained 
intake personnel. For example:
  --Some investigators are more notorious than others. The intake 
        investigators are not attorneys but are making legal decisions. 
        Of course, this could be critical if the individual does not 
        first see an attorney or delays seeing an attorney until after 
        the charging party's deadline has passed.----Comment 23 
        (Raleigh)
  --Unqualified people tell me what does and does not fall under Title 
        VII.----Comment 170 (San Antonio)
  --The EEOC told one client that they had too many cases to really 
        read his case or deal with it since his did not involve a 
        termination.----Comment 30 (Boston)
  --Intake investigators do not seem to understand the elementary 
        principles of discrimination cases, do not seem to understand 
        the significance of certain facts when those facts are 
        presented to them during the intake interview, and can hardly 
        write an intelligent sentence in either the charge or the 
        affidavit.----Comment 132 (San Antonio)
  --I have been told by investigators that the charge cannot be 
        accepted without more detailed information, particularly 
        comparative information. The detail required appears to exceed 
        the notice pleading standard in federal court.----Comment 24 
        (El Paso)
  --I have seen cases of non-represented complainants in which the 
        intake person at the EEOC drafts a charge and immediately 
        issues a notice of right to sue, telling the complainant he/she 
        ``doesn't have a case'' based on the intake person's inaccurate 
        understanding of the law (e.g., ``If you were the only person 
        it happened to it can't be discrimination. . . .''). I wonder 
        how many persons with legitimate complaints rely on that 
        ``advice'' and decide not to pursue their claim.''----Comment 
        148 (St. Louis)
    Timely claims are jeopardized due to delays in the EEOC's 
procedures. For example:
  --[R]ecently I was contacted by a charging party who had submitted 
        his questionnaire in October, but as of mid-February had heard 
        nothing from EEOC. His 180 days to file was within a month of 
        running. I contacted EEOC on his behalf and was told that they 
        were ``just getting to'' the October questionnaires and that 
        the fact that his time was close to running did not give it any 
        priority over other charges. I ended up filing a charge on his 
        behalf instead of waiting for the EEOC.----Comment 92 (Atlanta)
  --I have a case now where the EEOC told my client that he did not 
        have a case, and that they wouldn't accept his charge. He 
        insisted, so they accepted the charge (that they drafted). 
        Months later (after 300 days post-incident) he got a call from 
        the EEOC telling him that he needed to sign another (identical) 
        charge. He did, sent it back, and it was stamped ``filed'' for 
        that new date. Then, the EEOC dismissed him for filing too 
        late. Luckily, he had a copy of the original stamped charge, 
        and we survived a motion to dismiss on this.----Comment 2 
        (Chicago); see also, Comment 37 (Dallas)
  --The EEOC routinely attempts to re-write the charge, invariably 
        leaves [information] out, and then sends the revised charge to 
        the client for signature. It then tries to substitute the date 
        of the ``new'' charge for the original filing date. I then have 
        to write to the EEOC and demand that they use the original 
        charge and original filing date. The EEOC has backed down after 
        receiving my correspondence, but my intervention should not be 
        necessary. In [another] case in 2006 the EEOC told [my client] 
        that it could not accept his charge unless he came into the 
        EEOC personally and complete[d] an intake with an EEOC 
        employee. The EEOC then sent a letter to the client informing 
        him that his charge was not valid and would not be accepted 
        until he followed through on the personal interview. I wrote to 
        the EEOC, explained the statutory requirements for filing, and 
        it ultimately accepted the charge with the original date. 
        Again, this should not have been necessary, particularly since 
        I had entered my appearance.----Comment 104 (Philadelphia)
    Arbitrary and capricious actions by EEOC personnel jeopardize 
employees' rights. For example:
  --They required a whole new charge to be filed for one typo.----
        Comment 70 (Indianapolis)
  --In the past 30 days . . . a charge [was] returned to me telling me 
        that normally they have staff to make corrections on charges, 
        but because they do not have enough staff currently, they were 
        sending back my charge and giving me 33 days to correct the 
        charge. They said that the charge was deficient because I 
        stated the type of disability on the charge form, I described 
        damages and my charge narrative was too lengthy (it fit on the 
        front of the charge form).----Comment 168 (Philadelphia)
  --[O]n several occasions from 2005 to the present, [the Miami office] 
        tried to reject charges [I'd filed] (the most recent occasion 
        being this month). When I challenged them and asked them to 
        cite the provision of the EEOC regulations that authorized them 
        to reject the charge, they backed off. The most egregious of 
        these instances was a disability discrimination charge in which 
        ``disability'' and ``retaliation'' were checked off and the 
        charge alleged that my client was an individual with a 
        disability who was being denied urgently needed accommodations 
        and whose medical information was not being kept confidential. 
        (My client was literally dying because of the employer's change 
        in his work schedule, which interrupted his regime for taking 
        HIV medication.) Someone from the Miami EEOC office called and 
        said the charge was being rejected because it didn't expressly 
        mention the Americans with Disabilities Act. I hit the roof and 
        told them that the description of the discrimination and 
        checking off of ``disability'' made it patently obvious that 
        this was an ADA charge.----Comment 101 (Miami)
    Inability to contact EEOC personnel. For example:
  --Complete inability to talk to any EEOC personnel about status of 
        charge, investigation, etc.; complete failure of EEOC to 
        conduct any investigation of charges that clearly are 
        meritorious.----Comment 185 (Baltimore)
  --I have had . . . numerous occasions where I have attempted to get 
        in touch with investigators to convey information or inquire 
        into case status and my calls have not been returned.----
        Comment 128 (Cincinnati)
    Other Intake Problems Confronted by Survey Respondents and Their 
Clients:
  --Lack of Spanish-speaking personnel.----Comment 80 (Birmingham)
  --The EEOC charge form is not readily available.----Comment 82 
        (Dallas); see also Comment 32 (Cincinnati)
  --Lack of coordination among EEOC personnel (e.g., different 
        investigators assigned to charges against the same employer 
        involving the same discriminatory practice).----Comment 86 
        (Dallas)
  --Lost charges and files.----Comments 114 (Philadelphia); Comment 65 
        (St. Louis); Comment 128 (Cincinnati); Comment 62 (Baltimore)
  --Failure to provide right-to-sue letter.----Comment 116 (Charlotte)
            Problems with Investigations and Post-charge Processing
    The narrative comments that accompanied the survey responses also 
enumerate repeated concerns about what takes place after charges are 
accepted by the EEOC. These concerns include the following:
  --Cursory investigations by untrained investigators. For example:
    --The problems I have encountered have occurred after the charge is 
            filed. We have had several cases where the EEOC simply 
            decided not to investigate or even [to] require a response 
            from the Respondent because the EEOC decided the charging 
            party could not be discriminated against on the basis of 
            race if the decision maker was the same race. That is not 
            the law, but it is making it hard to prosecute these 
            cases.----Comment 13 (Chicago) [emphasis supplied]
    --My problems have been with the EEOC's lack of investigation and 
            routine acceptance of the respondent's position.----Comment 
            116 (Charlotte)
    --Zero knowledge of pretext. EEOC requires direct evidence or they 
            dismiss the claim. Also, zero knowledge of the single 
            enterprise theory. If the employer says they don't employ 
            15 people or 50 people, etc., EEOC makes no further 
            inquiry.----Comment 52 (New Orleans)
    --The EEOC routinely contacts clients who are represented by 
            counsel and gives them advice which is often incorrect, and 
            causes the clients unnecessary confusion.----Comment 104 
            (Philadelphia)
    --Pregnancy discrimination charge dismissed because client was 
            replaced by a female. Investigator didn't understand that 
            the female that replaced my client was not pregnant. 
            Recently, same investigator would not allow my client to 
            amend charge to include retaliation which occurred after 
            the filing of the first charge. New charge had to be filed 
            after discussion with investigator's supervisor.----Comment 
            113 (Denver)
    --[T]he investigators are overwhelmingly unqualified (can't even 
            identify the prima facie elements to claims, and have no 
            clue how to investigate). There is very little access and 
            transparency, since the District Director . . . is more 
            interested in closing files and denying access to position 
            statements than he is in having his investigators do their 
            job.----Comment 73 (El Paso)
    --Another EEOC problem: they are not investigating a lot of 
            charges. I've had a few potential clients come in with 
            charges that received no substantial evidence findings 
            within 7 days of filing.----Comment 2 (Chicago)
  --Perfunctory acceptance of the employer's written response to the 
        charge, and little or no assessment of the merits or follow-up 
        to test the representations contained in the employer's 
        response (such as contacting witnesses or obtaining relevant 
        comparative data). For example:
    --[The] most frequent and significant problem I have encountered is 
            resistance by some investigators to conduct a meaningful 
            investigation if they have determined that the case has no 
            merit. Investigators will often receive the employer's 
            position statement and reach a premature conclusion that 
            the charge has no merit. The investigators are then 
            resistant to conduct[ing] an investigation (e.g., contact 
            witnesses or obtain documents) that might indicate that the 
            employer's position statement is inaccurate or is not 
            meritorious. In my opinion, this resistance occurs from a 
            need to move and close files at a certain rate.----Comment 
            77 (St. Louis)
    --We get almost no feedback on the [investigation] process. 
            Conciliation ends up undervaluing the claims dramatically. 
            There are a few good investigators, but for the most part 
            there seems to be no will to question, let alone rebut, the 
            proffered explanation of the employers. When we FOIA the 
            records afterward there is almost no discovery conducted. 
            There is almost never a ``for cause'' finding. I think I 
            have seen at most three or four throughout a fifteen year 
            career. Needless to say I have settled many a case in which 
            the EEOC found no cause. The administration at our [EEOC] 
            office seems completely oblivious to the problems. When the 
            issues are raised, the reaction is, ``Well, that is not our 
            policy, so, it must not be happening the way you describe 
            it.'' I was on the verge of FOIAing the Detroit district 
            office annual reports to use to request some sort of 
            Congressional oversight from our senators.----Comment 99 
            (Detroit)
    --The problems I have with the EEOC occur during the supposed 
            ``investigation'' of the charge. The investigators 
            typically receive the employer's position statement, treat 
            it like the gospel, do nothing more, and then issue a 
            terrible letter telling my clients that they were horrible 
            employees and that there was no discrimination. I have 
            repeatedly complained about this to the [EEOC] Cleveland 
            counsel, to no avail.----Comment 98 (Cleveland)
    --They simply notify us of their intent to dismiss based on the 
            employer's position statement without giving the charging 
            party an opportunity to refute what the employer has 
            said.----Comment 29 (Detroit)
  --Perfunctory issuance of boilerplate right-to-sue letters at intake 
        or after a pro forma investigation. For example:
    --I have seen several instances of clients who file charges and 
            receive their notice of right to sue at the same time, with 
            no investigation.----Comment 83 (Dallas)
    --My problems arise after filing and the EEOC does nothing. I draft 
            questions and investigators do not investigate or are just 
            too busy to do anything. I file at least a half dozen 
            charges each year. Inevitably we get back the punt, unable 
            to determine if discrimination took place.''----Comment 57 
            (Philadelphia)
Inadequate Funding: The Source of the Problems
    These findings, as alarming as they are, do not come as a surprise. 
They clearly are, in substantial part, symptomatic and the consequence 
of an inadequate budget which has resulted in an understaffed agency 
burdened with a massive flow of charges and an ever growing backlog. 
The Commission has struggled to meet the mounting pressures of this 
burden and has tried to adjust to the realities of its budget through a 
major reorganization and reallocation of staff. Members of Congress, 
NELA, and other stakeholder organizations were critical of and voiced 
their skepticism about the reorganization, fearing it would, if 
anything, further deplete enforcement and would not result in staffing 
that would achieve the results forecast by EEOC. Whether those 
criticisms were well founded or whether the Commission's blueprints for 
reorganization make sense are appropriate subjects of debate and 
scrutiny. That controversy, however, ignores an overwhelming reality.
    When the chaff is separated from the wheat, the key fact that 
emerges is that the EEOC has for many years only been able to budget a 
small amount of its funding to enforcement and virtually nothing to 
training personnel. This renders the Commission ill-equipped to achieve 
its mission, produces never-ending delays, prevents even minimal 
training of staff, and breeds inordinate pressures not to add to a 
burgeoning backlog by junking potential and actual cases at every step 
of the administrative process. More specifically, it produces an 
inherent resistance to the filing of charges by compliance staff, 
shortchanges investigations (if and when they take place), and 
increases an administrative ``washing of hands'' of cases through the 
convenience of boilerplate Notices of Right to Sue that include nothing 
but a mere check-off box for ``insubstantial evidence to determine'' 
discrimination.
    The inescapable conclusion is that the reductions in the EEOC's 
budget over the past several years have wreaked havoc upon the 
Commission's enforcement efforts. For all intents and purposes, these 
budget levels have imposed upon the EEOC a paralysis that frustrates 
Congressional intent in enacting equal employment opportunity laws, the 
Commission's efforts in achieving its mission and, moreover, the rights 
of American workers to be free from unlawful employment discrimination. 
For those who do succeed in obtaining relief from illegal employer 
conduct, that relief is likely to be only after years of delay.
    In enacting various anti-discrimination laws, Congress has signaled 
that addressing and eliminating invidious discriminatory employment 
practices is one of the nation's highest priorities. Thus, it is 
incumbent upon Congress to ensure that the Commission--the federal 
agency that it has mandated to enforce these laws--receives the 
necessary funding to rectify the untenable morass described in this 
report. If the EEOC is to overcome the dire consequences of past budget 
reductions, then funding well beyond the current levels must be made 
available.
    At the same time, the EEOC also must be held accountable to 
Congress and the public it serves. Thus, oversight and assessment 
mechanisms must be put into place to assure that additional resources 
are directed toward viable and meaningful enforcement of the EEOC's 
mandates. In particular:
  --Immediate attention should be given to how many investigators and 
        attorneys are assigned to each of EEOC's offices as well as to 
        the past and anticipated case flow at each of these offices.
  --A critical examination is needed to determine what, if any, 
        training is provided to EEOC's compliance staff.
  --If EEOC intends to make good on its commitment to revitalize 
        systemic cases, then the agency needs to assess whether it has 
        sufficient staff attorneys and support personnel to fulfill 
        this promise.
  --Mechanisms are required to ensure that individual cases are not 
        short-changed while the Commission pursues systemic cases.
  --Factors relating to employee performance incentives and awards 
        should be based on enforcement of the laws, vindication of 
        civil rights and changing business practices as opposed to 
        speeches and community outreach.
Conclusion
    The findings of NELA's survey lend credence to the problems faced 
by the EEOC and those Americans the agency is mandated to protect from 
unlawful employment discrimination. For the EEOC to fulfill its mission 
as the federal agency most responsible for the enforcement of the 
nation's equal employment opportunity laws, these problems must, at a 
minimum, be addressed with more resources targeted at improving basic 
enforcement functions.
    appendix a.--nela eeoc charge processing survey--numerical data
    Total Responses: 343
    1. Name:
    2. EEOC Office you primarily practice before:
    3. Since January 1, 2005, have you drafted a discrimination charge 
(or charges) for a client (or clients) that was (were) not accepted for 
filing by the EEOC office identified above?

------------------------------------------------------------------------
                                                         Number  Percent
------------------------------------------------------------------------
Yes...................................................       77    22.60
No....................................................      264    77.40
                                                       -----------------
      Total Respondents...............................      341  .......
------------------------------------------------------------------------

    4. If yes, how many times did it occur in calendar year 2005:

------------------------------------------------------------------------
                                                         Number  Percent
------------------------------------------------------------------------
0.....................................................      155    74.20
1.....................................................       18     8.60
2.....................................................       19     9.10
3-5...................................................       13     6.20
6-10..................................................        1     0.50
11 or more............................................        3     1.40
                                                       -----------------
      Total Respondents...............................      209  .......
------------------------------------------------------------------------

    5. How many times did it occur in calendar year 2006:

------------------------------------------------------------------------
                                                         Number  Percent
------------------------------------------------------------------------
0.....................................................      153    70.50
1.....................................................       37    17.10
2.....................................................       15     6.90
3-5...................................................       10     4.60
6-10..................................................  .......  .......
11 or more............................................        2     0.90
                                                       -----------------
      Total Respondents...............................      217  .......
------------------------------------------------------------------------

    6. How many times did it occur from January 1, 2007 to present:

------------------------------------------------------------------------
                                                         Number  Percent
------------------------------------------------------------------------
0.....................................................      198    92.50
1.....................................................       13     6.10
2.....................................................        1     0.50
3-5...................................................        2     0.90
6-10..................................................  .......  .......
11 or more............................................  .......  .......
                                                       -----------------
      Total Respondents...............................      214  .......
------------------------------------------------------------------------

    7. Since January 1, 2005, have you prepared an EEOC intake 
questionnaire (or questionnaires) that was (were) not accepted by the 
EEOC office identified above:

------------------------------------------------------------------------
                                                         Number  Percent
------------------------------------------------------------------------
Yes...................................................       19     5.70
No....................................................      316    94.30
                                                       -----------------
      Total Respondents...............................      335  .......
------------------------------------------------------------------------

    8. If yes, how many times did it occur in calendar year 2005:

------------------------------------------------------------------------
                                                         Number  Percent
------------------------------------------------------------------------
0.....................................................      156    94.00
1.....................................................        2     1.20
2.....................................................        5     3.00
3-5...................................................        1     0.60
6-10..................................................        2     1.20
11 or more............................................  .......  .......
                                                       -----------------
      Total Respondents...............................      166  .......
------------------------------------------------------------------------

    9. How many times did it occur in calendar year 2006:

------------------------------------------------------------------------
                                                         Number  Percent
------------------------------------------------------------------------
0.....................................................      155    90.60
1.....................................................       10     5.80
2.....................................................        3     1.80
3-5...................................................        2     1.20
6-10..................................................        1     0.60
11 or more............................................  .......  .......
                                                       -----------------
      Total Respondents...............................      171  .......
------------------------------------------------------------------------

    10. How many times did it occur from January 1, 2007 to present:

------------------------------------------------------------------------
                                                         Number  Percent
------------------------------------------------------------------------
0.....................................................      166    96.50
1.....................................................        5     2.90
2.....................................................  .......  .......
3-5...................................................        1     0.60
6-10..................................................  .......  .......
11 or more............................................  .......  .......
                                                       -----------------
      Total Respondents...............................      172  .......
------------------------------------------------------------------------

    11. Since January 1, 2005, have you had other problems with the 
EEOC in the processing of charges or intake questionnaires (e.g., 
resistance by EEOC office identified above to accepting filing as 
prepared by you, substantial modification by EEOC of what you prepared, 
etc.):

------------------------------------------------------------------------
                                                         Number  Percent
------------------------------------------------------------------------
Yes...................................................      117    35.70
No....................................................      211    64.30
                                                       -----------------
      Total Respondents...............................      328  .......
------------------------------------------------------------------------

    12. If yes, how many times did it occur in calendar year 2005:

------------------------------------------------------------------------
                                                         Number  Percent
------------------------------------------------------------------------
0.....................................................      130    62.20
1.....................................................       24    11.50
2.....................................................       30    14.40
3-5...................................................       21    10.00
6-10..................................................        4     1.90
11 or more............................................  .......  .......
                                                       -----------------
      Total Respondents...............................      209  .......
------------------------------------------------------------------------

    13. How many times did it occur in calendar year 2006:

------------------------------------------------------------------------
                                                         Number  Percent
------------------------------------------------------------------------
0.....................................................      117    55.70
1.....................................................       34    16.20
2.....................................................       32    15.20
3-5...................................................       23    11.00
6-10..................................................        3     1.40
11 or more............................................        1     0.50
                                                       -----------------
      Total Respondents...............................      210  .......
------------------------------------------------------------------------

    14. How many times did it occur from January 1, 2007 to present:

------------------------------------------------------------------------
                                                         Number  Percent
------------------------------------------------------------------------
0.....................................................      164    79.20
1.....................................................       28    13.50
2.....................................................        8     3.90
3-5...................................................        5     2.40
6-10..................................................        2     1.00
11 or more............................................  .......  .......
                                                       -----------------
      Total Respondents...............................      207  .......
------------------------------------------------------------------------

 appendix b.--nela eeoc charge processing survey list of eeoc offices 
                       referenced by respondents
Atlanta District Office
Birmingham District Office
Charlotte District Office
Chicago District Office
Dallas District Office
Houston District Office
Indianapolis District Office
Los Angeles District Office
Memphis District Office
Miami District Office
New York District Office
Philadelphia District Office
Phoenix District Office
San Francisco District Office
St. Louis District Office
Baltimore Field Office
Cleveland Field Office
Denver Field Office
Detroit Field Office
New Orleans Field Office
San Antonio Field Office
Tampa Field Office
Seattle Field Office
Washington Field Office
Albuquerque Area Office
Boston Area Office
Cincinnati Area Office
El Paso Area Office
Kansas City Area Office
Louisville Area Office
Milwaukee Area Office
Minneapolis Area Office
Nashville Area Office
Newark Area Office
Pittsburgh Area Office
Raleigh Area Office
Buffalo Local Office
Greenville Local Office
Honolulu Local Office
Las Vegas Local Office
Norfolk Local Office
Oakland Local Office
Richmond Local Office
San Diego Local Office
San Jose Local Office
San Juan Local Office
Savannah Local Office
 appendix c.--nela eeoc charge processing survey comments organized by 
                                 office
Atlanta District Office
    16. [No problems] in the charges we file except that when we have 
more than one employer the EEOC now insists upon having separate 
charges and they have ended up going to different investigators. Our 
clients who come to us after going to the EEOC, on the other hand, have 
numerous horror stories about being told they couldn't file because 
they still had their job, didn't have a case, etc.
    34. I receive many calls from potential clients that describe being 
turned away from EEOC and not allowed to file a charge of 
discrimination.
    41. The problems with the EEOC usually arise when the charging 
party is NOT represented by an attorney. That's usually when I hear 
about instances of the EEOC refusing charges, or advising charging 
parties that they don't have any claims, etc. When the charge comes 
from a lawyer, it's been my experience that they usually accept the 
charge.
    49. Requests to interview my clients directly without informing me 
of the nature or specific purpose of the interview, other than saying 
that the charge as drafted was insufficient.
    59. One of my clients just had his case, a strong religious 
discrimination case, dismissed due primarily to the EEOC's 
incompetence. The client went to the EEOC, pro se, complaining about 
religious discrimination in the workplace. The investigator said that 
much of the supporting evidence my client had was more than 6 months 
old, and discouraged my client from filing a religious [discrimination] 
claim. The investigator asked my client the race of client's boss, who 
is white. The client is black. The investigator said he'll check off 
the race box. My client said no, it's not a race claim, it's a 
religious discrimination claim. The investigator said that he can only 
check off one box, and since a lot of client's evidence is more than 6 
months old on the religious [discrimination] claim (but his termination 
was within 6 months), he will go with race only. My client was pro se, 
at the EEOC for the first time, and wrongly trusted the investigator to 
get it right. My client subsequently put on the questionnaire that it 
is a religious discrimination as well as race matter. The Court denied 
Defendant's motion to dismiss for failure of notice in the early stages 
of the litigation. We then went through full discovery, costing the 
client over $7,000. Then, a new judge took over the case. He tossed the 
case on summary judgment due primarily to the EEOC mishandling of the 
charge. He also briefly went over the facts of the case and determined 
the underlying facts were not strong enough. That was argued very 
poorly and we would have had a good shot on appeal on that argument. 
Unfortunately though, his primary argument--the EEOC matter--has enough 
case law on both sides. We decided not to appeal.
    92. The primary problems of which I am aware are related to 
unrepresented charging parties who try to file charges. For example, 
recently I was contacted by a charging party who had submitted his 
questionnaire in October, but as of mid-February had heard nothing from 
EEOC. His 180 days to file was within a month of running. I contacted 
EEOC on his behalf and was told that they were ``just getting to'' the 
October questionnaires and that the fact that his time was close to 
running did not give it any priority over other charges. I ended up 
filing a charge on his behalf instead of waiting for the EEOC.
    93. NELA-GA is in communication with the Atlanta EEOC office about 
joint employers. The EEOC wants separate charges filled out for each 
employer (meaning the charges are assigned to different mediators, 
different investigators . . .); NELA-GA wants all employers to be 
listed on the same charge.
    110. EEOC often pigeon holes a complaint into ``race'' or 
``gender'' rather than check multiple boxes to cover discrimination 
based on more than one factor. EEOC also often gives clients 
incompetent and wrong legal advice.
    118. While I have not had problems with the EEOC accepting my 
charges or questionnaires, I have had many potential clients report 
that the EEOC would not accept their charges--at least 4 in the past 
two months. I cannot say how many have reported this since January 
2005, but the numbers seem to be increasing of late. In addition, the 
EEOC does not want any information before the 180 day filing period, 
whether or not this information is relevant to the discrimination 
claims in the charge.
    119. Individuals going to the EEOC alone and having the intake 
office refuse to take their charge or telling them they have no case.
    142. Telling people who come in, even if they have a witness with 
them that they have no case. In one instance it involved touching 
sexual harassment and an eye witness and they were turned away. They 
tell the potential charging party they have no case and never inform 
them that there are other laws that the EEOC does not enforce that may 
apply to their situation. Also have had preemptory dismissals without 
any defect on the face of the charge.
    173. Refusal to allow charging party to check more than one box; 
refusal to allow charging party to name employment agency or joint 
employer; not allowing charging party to mention events outside 180 
days on the face of the charge; telling charging party she doesn't have 
a charge and not letting her file.
    175. One investigator threatened not to accept an amended charge. I 
filed it anyway.
Birmingham District Office
    80. Lack of Spanish-speaking EEOC personnel in the South.
    95. Years ago, in the 1990s, the Birmingham office would not take a 
charge by fax. I haven't tried since then. I think charges should be 
accepted by fax, email, etc.
    151. Most investigators are lazy and rude; one black male hated all 
complaints from females, asking ``Who do you think you are?'' to a 
sexual harassment victim. He was equally threatening to me. Had to go 
to the national director to get him removed. Turned out he was having a 
gay affair with an executive of the employer. With no state employment 
discrimination laws, we must go through EEOC.
Charlotte District Office
    7. I have not really had any problems in connection with the filing 
of a charge. My problems have been with the EEOC's lack of 
investigation and routine acceptance of the respondent's position. 
Also, I have had some incidents where the EEOC has not provided the 
right to sue letter to the complainant.
    116. My clients who go in person to file charges have been turned 
away and told they do not have a charge. They have also encountered 
some rude intake people. I have had to tell clients to go back and 
insist they have a right to file a charge. I have also had EEOC people 
discourage people from retaining an attorney.
    141. I have two problems with the EEOC. One, they will not issue a 
right to sue letter 180 days after the charge is filed. Two, they will 
not keep me informed of the status of the charge.
Chicago District Office
    1. Particular EEOC investigator [deleted] is pre-disposed to 
employer stances/defenses. [Deleted] has completely unreasonable 
demands of clients for specific dates and times of discussions from 
over a year prior. [Deleted.] demands both shorter CODs and more 
details and facts. [Deleted] even accused attorney of coaching witness 
to change testimony and of witness of changing testimony.
    2. The EEOC-Chicago now has a rule that they any charges that come 
in notarized automatically get sent to the Illinois Department of Human 
Rights. The EEOC will take only un-notarized charges. I learned of this 
rule from an investigator. Another EEOC problem: they are not 
investigating a lot of charges. I've had a few potential clients come 
in with charges that received no substantial evidence findings within 7 
days of filing. I have a case now where the EEOC told my client that he 
did not have a case, and that they wouldn't accept his charge. He 
insisted, so they accepted the charge (that they drafted). Months later 
(after 300 days post-incident) he got a call from the EEOC telling him 
that he needed to sign another (identical) charge. He did, sent it 
back, and it was stamped ``filed'' for that new date. Then, the EEOC 
dismissed him for filing too late. Luckily, he had a copy of the 
original stamped charge, and we survived a motion to dismiss on this. 
But the EEOC file had notes saying that he chose not to file the first 
charge--total cover-your-#$@ language. I'm guessing they lost the first 
charge. Another client of mine had his Chicago charge ignored for 8 
months, when he called on it, the Chicago office hadn't heard of him. 
He got a call a few days later from the Cleveland office; they were 
investigating it. He talked to the investigator and she said she'd get 
back to him in 30-45 days. Four hours later she called back, said never 
mind the previous call, she was issuing a right to sue now because she 
determined from reading the charge that he was not a qualified person 
with a disability. (!!!!!) In other words, she was not investigating 
it, period. I have another case at the EEOC that has been there for a 
couple of years. It has class action potential against a major 
retailer, so the legal department is thinking about it. I check in 
periodically, get told they are still thinking about it. I don't want 
to rock the boat because it would be GREAT for the clients if the EEOC 
took this on, but it's been way too long.
    3. EEOC refused to accept charge of my client last September 2006. 
Two weeks before the 300th day, senior investigator sent a letter in 
mid-December saying she would not accept the charge. After I finally 
made a scene on the 300th day, EEOC accepted the charge and pulled the 
investigator off the file. Then when new investigator called to 
interview my client, she refused to give me the name of the attorney 
representing the company so I could discuss settlement with the 
attorney. I was told the EEOC never gives out names of lawyers and if 
we wanted to discuss settlement, we could only do so through EEOC 
(translate: so they can get credit for any settlement amounts). On 
other fronts, we have seen a great deal of foot dragging on issuing 
right to sue letters.
    10. Twice my office was told by an EEOC representative that they 
changed a policy and now any charge that was notarized would not be 
accepted for filing. We had to have the client re-sign the cover sheet 
and filed it unnotarized. However, since mid-2006 when this occurred, 
we have filed several other charges where the charge was accepted 
notarized without incident.
    13. The problems I have encountered have occurred after the charge 
is filed. We have had several cases where the EEOC simply decided not 
to investigate or even require a response from the Respondent because 
the EEOC decided charging party could not be discriminated against on 
the basis of race if the decision maker was the same race. That is not 
the law, but it is making it hard to prosecute these cases.
    14. Re: filing charges--they don't investigate, they won't litigate 
good cases and choose to litigate horrid cases--they've got it all 
backwards here.
    31. Apart from my personal experience, potential clients report 
EEOC turning them away when they attempt to file a charge. EEOC will 
opine they don't have a case. On at least two occasions they misplaced 
written appearance notice and contacted client directly.
    40. I have never had the EEOC reject for filing a charge I have 
drafted, although there was a lot of confusion last year when the EEOC 
suddenly began to refuse to accept charges that had been notarized. In 
my experience, however, problems with charge filing at the EEOC's 
Chicago office are more likely to occur when an individual is not 
represented by an attorney. I have had clients first come to me after 
they filed a charge that they had EEOC drafted for them, and the charge 
often omits important allegations that the client told the EEOC about. 
In addition, charge intake personnel sometimes give individuals 
misinformation about the strengths or weaknesses of their claims.
    45. Because of previous problems with the EEOC I always draft the 
charges and have them hand delivered and stamped. I stopped sending my 
clients in to file on their own behalf because the EEOC often will not 
include all claims (even when client has been instructed by me as to 
what claims, or they tell clients they don't have a case even though I 
have already determined that they do.
    60. EEOC refused to file various charges, but I eventually talked 
them into it. EEOC eventually accepted all charges.
    72. Chicago office refuses to release the respondent's position 
statement ``to the claimant's counsel or to the claimant.''
    75. The triage system for handling charges is not well implemented. 
Some investigations done are haphazard. The office does not timely 
respond to FOIA requests for documents in investigative files, even 
after the right-to-sue is issued.
    143. Although I primarily work with the EEOC in Chicago, the office 
our firm had ``problems'' with was either Tampa or Miami (I'm fairly 
certain Miami). We were forced to significantly reduce the length of a 
charge, which required leaving out certain factual allegations we 
wanted to include. I'm fairly certain this was 2006, but it could have 
been late 2005. It could have been very problematic, given varying 
judicial interpretations of the ``scope of the charge'' doctrine, but 
the matter resolved.
    155. I have not encountered significant problems filing charges; 
however, I have been encountering increasing resistance during the 
investigative phase and even in mediation. Specifically, I have found 
an increasing desire by investigators and mediators to close their 
files at the expense of the charging party. Many times in recent years, 
the investigators have conducted themselves more like an opposing 
counsel would when taking my client's deposition (e.g., very 
adversarial and confrontational). I certainly don't believe that is the 
proper role of the EEOC.
    156. Investigator who rolled her eyes during the intake (my client 
was not represented then) was assigned to the investigation during 
which she ``no caused'' the case in record breaking time based on her 
impressions during intake.
    181. Problem I had was with Miami, Florida office. The EEOC would 
not accept the charge we drafted and instead re-wrote a shorter and 
less complete charge.
    186. The time for a charge to be processed from start until we get 
right to sue is wildly inconsistent. We get right to sues within a few 
months finding no evidence or get a right to sue over 1 year later. 
There is no consistency that I have recognized either in terms of the 
type of charge, merit of the charge, or any other possible pattern.
Dallas District Office
    9. I file many charges with the EEOC. I prepare my clients' 
charges. I have never had a problem with the EEOC in accepting the 
charges.
    26. Failure to investigate, failure to interview witnesses, failure 
to request documents, difficulty in getting in touch with EEOC 
investigators.
    37. I had one disturbing situation with a client who met with me 
after first going to the Dallas EEOC. What he told me about his 
treatment there concerned me, as it may signal a more widespread 
problem in terms of acceptance of charges. In his situation, he was 
told that he did not have a case and that if he insisted on filing a 
charge they would give him a right to sue notice that day and he would 
have only 90 days to file suit. Since he didn't have an attorney at the 
time, he did not file the charge that day. Luckily, he met with me in 
sufficient time to still file a charge, which we did without trouble, 
and the case later resolved during litigation. The fact that he was 
turned away initially, however, bothers me a great deal. How many 
others are told they don't have a case and are turned away?
    58. Telling me what the law is even if they are wrong and therefore 
wanting to dictate dates of discrimination and whether I can mark 
continuing action. Not wanting to accept more explanation, such as a 
letter detailing the charge, as opposed to just limiting the 
information to the small space on the form. I got my way in the end 
each time, but was a hassle. For clients--not processing the intake 
questionnaire in a timely manner, such that questionnaire pre-dates by 
weeks actual charge while deadlines tick.
    82. The EEOC Charge form is not readily available.
    83. I have seen several instances of clients who file charges and 
receive their notice of right to sue at the same time, with no 
investigation. I have also had clients tell me that they were told that 
they did not have a case and were not allowed to file a charge.
    84. A client who filed her charge with the San Antonio, TX office 
in 2005 (prior to my representation of her) was forced to substantially 
modify her claims and description of events supporting her charge. The 
EEOC staff member said that the EEOC would not accept her charge unless 
she made the changes. These changes substantially and negatively 
impacted the client's case.
    85. Client filed initial race discrimination charge. After 
reporting some possible retaliation to me, I instructed her to write a 
letter to EEOC to amend charge to add retaliation. EEOC did not amend 
charge, and her charge received no attention for several months.
    86. Multiple clients filing charges against a single employer for 
the same reason. Charges are assigned out to different investigators. 
If one investigator were to take the charge, then they would have a 
more complete picture of what is going on at the employer. Also, the 
problem seems to be mainly with people who attempt to file charges 
without an attorney. I get many, many calls from people who say that 
the EEOC told them that they do not have a case when in fact they do 
have one, or would have if they had filed the charge when they 
contacted EEOC. EEOC gave them bad legal advice which caused them not 
to file when they should have, and their rights were compromised.
    96. I have had potential clients who tell me the EEOC told them 
there is ``no discrimination'' and refuse to take a charge.
    134. Other than the fact that for at least the last 25 years, the 
EEOC intake staff has demonstrated hostility to working people in 
general and a great capacity for leisure, nothing out of the ordinary--
but then I have come to expect nothing from the EEOC of a positive 
nature, either.
    136. Local offices have been resistant to providing a qualified 
sign language interpreter for interviews so that a person who is deaf 
can fully understand the questions they are being asked. At times, I 
have had to bring my own sign language interpreters to the EEOC office 
in order to ensure that my clients can understand what is going on in 
the interview.
    187. Sometimes I have to submit a legal brief to support the 
charge, but the EEOC office has always accepted the briefing.
    192. I have had clients go to the EEOC to try to file a charge 
before they have retained counsel. They were told by the EEOC that they 
did not have a case and were not allowed to file a charge. Once I was 
hired, I would send the client back to the EEOC, but there were times 
when the claim would be time barred if the EEOC did not use the initial 
date of the client visit. I have run into problems where the EEOC would 
not go back and use that initial first visit date as the date for 
filing the charge even though the EEOC told the client he/she could not 
file a charge because he/she did not have a case.
Houston District Office
    47. EEOC officials routinely tell individuals they cannot file 
charges or their grounds do not constitute violations. They are NOT in 
a position to know and have done no investigation. Usually they are 
wrong anyway for a plethora of reasons, including philosophic reasons. 
All charges should be allowed to be filed. Also, charges filed are 
incomplete and strictly boiler plate and missing essential facts and 
claims, usually discrimination and national origin claims as it relates 
to race and color claims. Also, the EEOC officials fail to identify 42 
USC 1981 claims which have no punitive damages limits as well and 
advise.
    87. I am now having trouble with multiple employers in two areas: 
(1) where we are not sure if the underlying employer is a separate 
company of the parent so we name both and both need to be noticed . . . 
am not sure they are; and, (2) where there are co-employers, I heard by 
the grapevine that they should be two separate charges on the same 
facts, but have not had anything rejected yet.
    103. They do not always confirm they have received a charge and 
return it with a charge number. Also, they often do not send a copy of 
the right to sue or other correspondence to the attorney.
    149. Not precisely relevant, but a couple years ago I represented a 
woman who went to the EEOC and met with an intake person. She was 
scared to death to file a charge and wasn't committed to doing so. She 
went just to get information and discuss her options. The intake person 
prepared a charge and mailed it to her. She wasn't prepared to file a 
charge. The next thing she knew, she received a notice of right to sue, 
copied to the employer, dismissing the charge she never filed on the 
grounds that she'd failed to cooperate. No investigation was done of 
course, and nor had she ever actually filed a charge. This was during 
the time that Houston was headed by [deleted], an incompetent 
management tool who remains in charge of the Dallas and San Antonio 
offices. I contacted him to seek some redress of the situation. He 
agreed to withdraw the notice of right to sue only if my client agreed 
to immediately file a charge with the understanding that it would be 
promptly dismissed without an investigation, thereby giving her an 
untainted right to sue. It was truly an appalling abuse of the 
Commission's authority, all around.
    158. People who file (or try to file) before obtaining our 
assistance have problems--they are refused, or the wrong claims are 
asserted, or joint employers are not named.
    183. Numerous clients over the years, including 2005-2007 have 
reported to me that the Houston District Office of the EEOC refused 
their attempt to file a charge. I also have had some reports of intake 
personnel at the office strongly discouraging individuals from 
contacting an attorney regarding their claims.
Indianapolis District Office
    70. They required a whole new charge to be filed for one typo.
    109. The Indianapolis EEOC office asked plaintiff's attorneys to 
cooperate with them by NOT preparing written filings to them for our 
clients. They want the intake questionnaires and charges to be drafted 
by their trained personnel. Given this request, we have provided our 
clients with contact information and sent them to file directly with 
the EEOC. Many, many of them have called me to complain that the EEOC 
intake officer told them they do not have a case and refuse to file a 
charge for them. Only after my client has become belligerent--because I 
warn them this may happen and they need to insist--then a charge is 
finally prepared and it is usually pretty sloppy. I then rewrite the 
charge for the client to sign and file. At the investigation stage, 
there is no such thing as an investigation anymore. I have not had the 
EEOC actually do an on-site investigation and take witness interviews 
in a case since they started the A,B,C classification system. Instead, 
I get a letter summarizing the respondent's legitimate non-
discriminatory action and a demand that I submit proof to rebut it--
which is ignored if I submit it--followed by issuance of a dismissal 
and notice of rights. I treat the EEOC process as just a time waster 
that allows my client to save up the filing fee so we can file a 
complaint as soon as the right to sue notice is issued. It is a real 
waste of taxpayer dollars.
Los Angeles District Office
    6. Inability of intake officers to distinguish important from 
unimportant information provided by claimant.
    8. The EEOC process is a complete mystery to me. I rarely file with 
the EEOC, so the numbers above represent 100 percent of my filings with 
the EEOC. In one case, there was such a substantial delay in 
communicating with me, I sent a letter asking for a right to sue 
letter. Despite follow-up calls and letters, to date, my client has 
never received a right to sue letter. Over six months has elapsed. I 
really do not understand the procedures.
    23. Most of our charges are initiated by the Nevada Equal Rights 
Commission (NERC) as the deferral agency to the EEOC. The NERC 
frequently to my understanding refuses to take charges from individuals 
acting in proper person.
    78. I personally have not had any situations where the EEOC has 
refused to accept a charge drafted by me. However, it should be noted 
that many years ago I worked at the EEOC as an attorney (and prior 
thereto as a Paralegal and Investigator) and still know some of the 
individuals at the agency. I do know that the Los Angeles office is 
VERY short staffed. The number of investigators is dismal in comparison 
to the number of investigators that were at the agency when I was there 
in the 1980s.
Memphis District Office
    42. Intake person did not want to accept charge which I prepared 
and filed on behalf of a client. After that resistance, I began to file 
the charges by mail and did not meet with any further resistance.
    137. They have tried to rewrite the charge to be very vague and 
non-specific, which leads to all kinds of trouble later. When I 
protested, the EEOC intake worker said that they had been instructed to 
take out specifics and leave vague, bare-bones allegations.
Miami District Office
    4. The EEOC office in Florida is overwhelmed and conducts little or 
no investigation. They do not forward any documents to us and actually 
read the position over the phone as opposed to sending it to the firm. 
Often the investigator is uninformed on the law and has an out-dated 
definition of the law. Honestly, I see little benefit to the process 
and wonder if the budget could not be used in other ways.
    15. We are concerned that the EEOC rarely, if ever, contacts the 
witnesses that we provide before it makes a final determination/
decision. Needless to say, clients are upset if the EEOC does not 
contact the witnesses provided when making decisions. In fact, may 
clients feel that it is the firm's fault that the EEOC doesn't contact 
witnesses.
    17. My charges are frequently rewritten.
    21. Most recent problem was charging party worked at home and 
employer had no Florida address. I file charges with EEOC and FCHR, 
requesting EEOC mediate and investigate. Eliminates problems.
    44. None, but I am utilizing a local OEO office, which acts as an 
intake office for the Miami EEOC.
    53. The biggest issue is getting the investigator to actually do an 
investigation beyond reading the charge, position statement and reply. 
I have rarely seen that they contact witnesses, for example, or demand 
documents relevant to the charge.
    69. I have never experienced a problem with the Tampa office in 
nearly nine years of dealing with them. [Deleted] and [deleted] are 
especially helpful.
    101. The Miami office has accepted all the charges that I've 
drafted but on several occasions from 2005 to the present, they tried 
to reject charges (the most recent occasion being this month). When I 
challenged them and asked them to cite the provision of the EEOC 
regulations that authorized them to reject the charge, they backed off. 
The most egregious of these instances was a disability discrimination 
charge in which ``disability'' and ``retaliation'' were checked off and 
the charge alleged that my client was an individual with a disability 
who was being denied urgently needed accommodations and whose medical 
information was not being kept confidential. (My client was literally 
dying because of the employer's change in his work schedule, which 
interrupted his regime for taking HIV medication.) Someone from the 
Miami EEOC office called and said the charge was being rejected because 
it didn't expressly mention the Americans with Disabilities Act. I hit 
the roof and told them that the description of the discrimination and 
checking off of ``disability'' made it patently obvious that this was 
an ADA charge. The most recent instance concerned a sexual harassment 
and retaliation charge that generally alleged that my client had been 
subjected to sexual and retaliatory harassment by managers. I received 
a phone call from an investigator at the Miami office in which he 
indicated that the charge would not be accepted for filing unless we 
provided specific facts on the face of the charge. In a not-very-
friendly tone, he asked how could I expect the employer to respond to 
the charge without putting it on notice of the instances of harassment.
    111. Would not let me file a single charge against two respondents 
that I was alleging constituted a joint employer.
    145. What I find is that unrepresented individuals are still being 
told ``you don't have a case'' and are turned away. Sometimes their 
time has passed before they decide to hire counsel. Otherwise, I have 
to say that I've had better luck the past couple of years with the EEOC 
process. More ``cause'' findings, although they are still unusual (I 
tell people they are more likely to be struck by lightning). And I had 
the first conciliation that actually resulted in a settlement in 20 
years of practice. Most still result in nothing but additional delay. I 
would definitely like to see more pressure put on parties to resolve in 
conciliation, such as mandatory participation in mediation.
New York District Office
    5. Often inadequate investigation, extremely slow but sometimes the 
investigator is very good.
    18. Investigations seem half hearted, with the outcome pre-
determined. I especially object to the New York office transferring 
matters to Boston, where the investigators seem to almost object to 
having to handle the file.
    36. Filing is usually no problem. It's the lack of meaningful 
action after that's the problem.
    39. I have never had a problem filing a charge with the NYDO. I 
have never had an intake officer refuse a charge or otherwise practice 
law without a license. I don't know if this happens to pro se charging 
parties but I have never had a client make such a complaint to me. I do 
make sure to file the charge in quintuplicate by certified mail return 
receipt requested.
    105. Investigation stage is very slow.
    122. The Boston Area Office waits 180 days and then dismisses the 
charge. The investigators are often deceived by a lengthy and organized 
position statement, regardless of substance.
    131. I sent a charge to the NYDO for filing in November 2006 and it 
was not processed until January 2007. Fortunately the statute of 
limitations had not run, but it caused significant anxiety for my 
client.
    178. Several years ago, maybe before 2005, I had to write letters 
to senior attorneys in Washington, D.C., to get someone to pay 
attention to the fact that I had to make an urgent filing. In general, 
I have found that the phone numbers listed on the EEOC website prior to 
the phone center were simply not answered at all in some cities. Most 
of my practice is outside of NY.
Philadelphia District Office
    11. The Philadelphia office sent one of my cases to the Baltimore 
office. The Baltimore office excluded my involvement even though I, the 
attorney for the charging party, filed the charges and had my name on 
record. The Baltimore office then made a determination solely on the 
employer's position statement that was filled with misrepresentations. 
The charging party was denied opportunity for a rebuttal because I 
never was notified after the case went to Baltimore for investigation. 
I learned of the Baltimore office's involvement only after a right to 
sue was issued. I was not sent a copy of the right to sue. Now the case 
is pending in USDC, Eastern District PA.
    22. Mailed charge. Intake called me and said the EEOC does not 
handle ``Black on Black'' discrimination. Claim was that an African 
American supervisor subjected employees to disparate treatment. A call 
to the office intake supervisor ([deleted]) took care of it.
    28. The only problem I have had is filing a charge and then 
receiving a stack of questionnaires in the mail which I have to fill 
out with my client before EEOC will docket the charge. All of the 
information in the questionnaires had been included in the charge and 
affidavit. Since then, I attended their intake training and even though 
I think the intake questionnaires are burdensome, I followed their 
instructions to the letter and have had no further problems with 
intake. My charges have tended to settle early so I have no further 
info re: handling subsequent to intake.
    46. Charges never get processed at all. I filed a charge two months 
ago and have not received any correspondence from any investigator on 
it.
    56. The only problem I have is that it takes weeks for the intake 
personnel to time stamp the charges making them appear to be filed 
later than they actually are. I have never had a problem with filing.
    57. I have never had a problem with filing charges. My problems 
arise after filing that the EEOC does nothing. I draft questions and 
investigators do not investigate or are just too busy to do anything. I 
file at least a half dozen charges each year. Inevitably we get back 
the punt, unable to determine if or if not discrimination took place.
    74. This was before 2005, but I had a client who was told by an 
investigator that he didn't have a claim because he lied on his 
employment application. The lie was that he said that he resigned from 
his prior job when he actually was fired and had a prior lawsuit 
claiming discrimination there. I had to go to Philadelphia with a 
letter that was a mini-brief before they overturned Newark and reopened 
the case. The Newark investigator never heard of the after-acquired 
evidence rule.
    88. More recently our problems with the EEOC have included 
misplacement of files and failure to notify our office of dismissals of 
charges and the issuances of notices of right sue letters. This has 
occurred twice thus far in 2007 from Philadelphia and once from Newark 
in 2006.
    104. I ordinarily file my own EEOC charges for my clients with an 
entry of appearance. The EEOC routinely attempts to re-write the 
charge, invariably leaves out, and then sends the revised charge to the 
client for signature. It then tries to substitute the date of the 
``new'' charge for the original filing date. I then have to write to 
the EEOC and demand that they use the original charge and original 
filing date. The EEOC has backed down after receiving my 
correspondence, but my intervention should not be necessary. For 
unrepresented clients or people represented by attorneys unfamiliar 
with the statute this could present some really difficult problems. In 
one case in 2006 the EEOC called my client, on whose behalf I had 
entered an appearance, and told him that it could not accept his charge 
unless he came into the EEOC personally and complete an intake with an 
EEOC employee. The EEOC then sent a letter to the client informing him 
that his charge was not valid and would not be accepted until he 
followed through on the personal interview. I wrote to the EEOC, 
explained the statutory requirements for filing, and it ultimately 
accepted the charge with the original date. Again, this should not have 
been necessary, particularly since I had entered my appearance. The 
EEOC routinely contacts clients who are represented by counsel and 
gives them advice which is often incorrect, and causes the clients 
unnecessary confusion.
    114. Charges have been lost. I believe charges from counsel should 
be accepted before questionnaires or other confirming information is 
provided.
    121. Intake workers and investigators who do not understand the law 
and, more importantly, decline to let you educate them about it.
    138. EEOC normally will not accept a charge unless it is 
accompanied by numerous other forms (which could be provided during the 
course of the investigation). These include: Allegations of 
discrimination; Witness Questionnaire; Remedy form; Discharge (or 
other) form; etc.
    139. I have filed a charge of discrimination on behalf of a client 
over 2 months ago and have yet to receive any correspondence even 
saying it has been received.
    140. The EEOC is consistently resistant to accepting charges 
drafted by my office as drafted and does not accept charges that 
require investigation on a systemic basis. After the charge is filed, 
it is often difficult to secure the cooperation of the investigators in 
seeking appropriate information and documents.
    146. Unfortunately most of the charges I file are with the Delaware 
Department of Labor that has a reciprocal working relationship with the 
EEOC. The EEOC can then do a substantial weight review, which means in 
most cases they adopt the DDOL findings.
    152. I handle many federal employee cases, so the procedure is 
different. When I have private sector cases I refer and file them at 
the PHRC because I do not like the EEOC procedures. Since I also take 
many small cases that have potential settlement value, I find that the 
``triage'' procedure at the EEOC is not conducive to getting such a 
case settled.
    157. Delays in docketing, not returning time-stamped copies.
    168. In the past 30 days I received a charge returned to me telling 
me that normally they have staff to make corrections on charges, but 
because they do not have enough staff currently, they were sending back 
my charge and giving me 33 days to correct the charge. They said that 
the charge was deficient because I stated the type of disability on the 
charge form, I described damages and my charge narrative was too 
lengthy (it fit on the front of the charge form).
    174. They are quite hostile to any charge that's actually carefully 
drafted by counsel. In Philadelphia anyway, they like to have one big, 
fat, run-on paragraph that throws in (supposedly) everything. It's the 
kind of drafting that any advocate would be ashamed of, has no 
persuasive value, and has no utility later in the case. They really 
resent a lawyer's effort to represent the client.
    177. My partner had a problem in the past year with an investigator 
trying to rewrite a Charge of Discrimination in an ADA case claiming 
that they were not allowed to accept charges that describe the 
disability in detail.
    188. Supposedly required information was missing from our charge. 
The charge was initially rejected but through discussions with the 
Buffalo office, those problems were resolved and the charge was 
accepted.
Phoenix District Office
    162. The time to get a Notice of Right to Sue once a request for 
dismissal of the case has been submitted.
    163. The EEOC doesn't seem to follow-up or even investigate some of 
the worst charges.
San Francisco District Office
    19. I generally discourage clients from filing with the EEOC 
because California's FEHA gives greater protection. But, I intervened 
in an EEOC case in 2005. I was appalled at how the EEOC investigator 
allowed the employer to limit the scope of his investigation to an 
interview with the general manager only. The EEOC investigator 
interviewed some of the witnesses and reviewed a few of the documents 
that my client had identified only after I complained. However, I found 
working with EEOC Deputy Attorney [deleted] both a privilege and a 
pleasure.
    33. Offices in our area follow different procedures and constantly 
demand more information or different formats to accept charges. We have 
not experienced refusals because we do not accept refusals and are 
persistent about filing charges. I would not send a client to file a 
charge himself/herself.
    43. None with the EEOC but lots with the California Department of 
Fair Employment and Housing.
    94. Sent a non-African-American client to EEOC to complain that he 
had been fired because employer thought he was African-American. EEOC 
told him he could not file a complaint.
    129. Several years ago I participated in a mediation conducted by a 
very biased mediator. It was obvious the mediator had a strong bias in 
favor of the University of Nevada (the defendant). I walked out of the 
mediation (I settled the case the next day (no thanks to the 
mediator)). I wrote to the EEOC and described the inappropriate and 
biased conduct of the mediator. This mediation occurred approximately 
in 2001. I have also experienced a couple of incidents whereby the EEOC 
basically attempted to hijack cases. I resisted these efforts 
successfully. The EEOC targeted my best cases, i.e., cases involving 
multiple sexual harassment victims, egregious conduct, blatant failure 
by management to redress the conduct, and strong corroborating 
evidence. I resisted the attempt to wrest control of the cases because 
I have had experience with the EEOC at mediation, i.e., I've witnessed 
an attempt by the EEOC to effect a nominal damage settlement in an 
extremely strong case involving seven plaintiffs. I effected a 
settlement for approximately 700 percent of what the EEOC mediator 
proposed the case be resolved for. It was obvious the EEOC mediator was 
intent on improving the EEOC's statistics--as opposed to achieving an 
acceptable resolution for the plaintiffs. Therefore, when the EEOC 
attempted to cherry pick my best cases, I resisted this effort. In my 
opinion, the EEOC tends to devalue good cases, i.e., they explain to 
plaintiffs (with extremely strong cases) the average settlement is 
something like $17,000 (I can't recall the exact figure used, but it is 
in this range). This is an appropriate settlement for a relatively weak 
case. The EEOC attempted to foist off this figure in one of my cases 
which involved seven women, who had been subjected to protracted, 
crystalline abuse (fucking c---, etc.). The response of management 
consisted of, ``if you don't like it, there's the door.'' I easily 
obtained six, devastating corroborating affidavits. The defendant 
employed approximately 20,000 persons.
    167. None. My problems in the last six years have been with the 
Oakland DFEH.
    191. Many, many problems pre-2005 with various offices, including 
San Jose and Miami. Much better experience recently.
St. Louis District Office
    77. Most frequent and significant problem I have encountered is 
resistance by some investigators to conduct a meaningful investigation 
if they have determined that the case has no merit. Investigators will 
often receive the employer's position statement and reach a premature 
conclusion that the charge has no merit. The investigators are then 
resistant to conduct an investigation (i.e. contact witnesses or obtain 
documents) that might indicate that the employer's position statement 
is inaccurate or is not meritorious. In my opinion, this resistance 
occurs from a need to move and close files at a certain rate.
    108. I haven't experienced any charge filing problems with the St. 
Louis District Office since 1/31/2006 when I started private practice. 
It is difficult to get a blank charge, so once you get one, the best 
thing to do is keep it on your computer for future use.
    135. I've had them ``lose'' an entire charge in 2005 that I had 
hand-delivered to the office. The internal ``mediators,'' [deleted] and 
[deleted], are wholly worthless and investigator [deleted] REFUSED to 
find a Title VII violation where active KKK recruitment was ongoing at 
the jobsite! He classed that as a Title VIII (and, yes HUD is involved 
and a Title VIII retaliation charge has been filed and is being 
litigated in KS USDC) case--but was overruled by the Regional Director 
and a Cause Finding issued leading to Conciliation (which failed).
    148. I have seen cases of non-represented complainants in which the 
intake person at the EEOC drafts a charge and immediately issues a 
notice of right to sue, telling the complainant he/she ``doesn't have a 
case'' based on the intake person's inaccurate understanding of the 
law; e.g. ``if you were the only person it happened to it can't be 
discrimination . . .'' I wonder how many persons with legitimate 
complaints rely on that ``advice'' and decide not to pursue their 
claim.
    176. I don't have problems--we have schooled over the years so that 
now they just take the charges we draft, give them a number and docket 
them. However, we hand deliver them and get them stamped received just 
to be safe. It is the unrepresented people who have problems. For 
instance, I have had people come to see me who have been told by the 
intake folks that they don't have a case and don't know they can insist 
on filing a charge. I draft and file the charge and there is no 
problem. I really worry about the folks who don't have a lawyer, not 
the ones who do!!
Baltimore Field Office
    55. The personnel don't seem to be very well trained and don't 
provide the follow-up or keep their commitments. The Baltimore office 
seems to be a low performer.
    62. Lost charges; when clients go to the EEOC on their own, EEOC 
representatives inadequately write up the complaint on the charging 
form or fail to allege all types of discrimination, thereby limiting 
the client's recovery.
    64. I have not filed any charges in the specified time frames, so 
have not had any problems.
    65. Charge not assigned to investigator for months, charge then 
transferred without reason to Baltimore.
    79. The Baltimore, MD EEOC initially would not accept a charge 
alleging discrimination against an employment agency. At first they 
didn't realize they had jurisdiction over employment agencies. Then 
they erroneously stated that in the 4th Circuit, the employment agency 
had to meet the definition of employer (i.e. at least 15 employees). 
The representative I spoke with finally agreed they should investigate, 
and then referred it to an investigator who didn't understand the notes 
that were supposedly in the file and dismissed it for lack of 
jurisdiction.
    127. Long periods of time without communication; erratic 
investigations--some investigators send the Respondents' position paper 
for us to rebut and others just dismiss the charge; mediation 
coordinator supervisor in Baltimore is terrible. (Keep this anonymous 
please.)
    165. I have not experienced any problems regarding the filing of 
charges. The main problem that I have experienced is being able to 
speak with an actual person when I call an office.
    185. Complete inability to talk to any EEOC personnel about status 
of charge, investigation, etc.; complete failure of EEOC to conduct any 
investigation of charges that clearly are meritorious.
Cleveland Field Office
    91. They make the clients wait to talk.
    98. The problems I have with the EEOC occur during the supposed 
``investigation'' of the charge. The investigators typically receive 
the employer's position statement, treat it like the gospel, do nothing 
more, and then issue a terrible letter telling my clients that they 
were horrible employees and that there was no discrimination. I have 
repeatedly complained about this to the Cleveland counsel, to no avail.
    133. EEOC is resistant to lawyers being involved in the process. 
And they require too much bureaucratic involvement at the front end, 
causing cases to be untimely. For this reason, I almost always refer 
clients to the state agency, where you can file a charge on-line, 
without the micromanaging that EEOC uses. They are useless, as far as 
investigation and providing any information regarding the employer's 
position, and I only recommend them when the charge is an age 
discrimination charge, based on our state's idiosyncratic way of 
dealing with them.
    144. No problems with filing (although I know that charging parties 
have contacted me after they've filed because of problems they've had). 
Always a problem getting EEOC to investigate!
    150. Investigators contacting the charging party directly despite 
my request to be involved with the intake and circumventing my attempts 
to set up a conference call.
Denver Field Office
    90. 1. Refusing to provide a copy of Position Statement or even a 
Summary of a Position Statement makes preparing a meaningful rebuttal 
nearly impossible. 2. Asking that rebuttals--even in complicated 
cases--be prepared within 5 days although the EEOC has had the Position 
Statement for more than a year. 3. Being asked by investigators to 
draft charges in a rigid manner when the facts are more wide-ranging 
and some context is necessary. As lawyers, we have to anticipate ways 
our charges may be attacked--which might require something other than 
what the investigator wants. 4. Disputes as to what is an amended 
charge or a new charge.
    113. Pregnancy discrimination charge dismissed because client was 
replaced by a female. Investigator didn't understand that the female 
that replaced my client was not pregnant. Recently same investigator 
would not allow my client to amend charge to include retaliation which 
occurred after the filing of the first charge. New charge had to be 
filed after discussion with investigator's supervisor.
    169. The EEOC makes it very difficult to file class charges or to 
file multi-charges for a number of class members who need a joint 
investigation. Our problems are not so much with the EEOC process in 
accepting charges, but in their failure to investigate cases and their 
biases against charging parties and their attorneys.
    180. The Denver office has turned individuals away who were NOT 
represented. In one case during 2006, they advised the client to get an 
attorney, but they still turned the client away. Thanks!
Detroit Field Office
    29. They simply notify us of intent to dismiss based on the 
employer's position statement without giving the charging party an 
opportunity to refute what the employer has said.
    76. My client went to file an EEOC charge against Cintas, a company 
that the EEOC has had multiple claims against. I wrote out the charge 
for the client and she went down. She called me in tears because the 
EEOC refused to take the claim. Told her she did not have a claim. Our 
office wrote a letter to the EEOC and I then accompanied her back to 
the EEOC. After the charge was taken, nothing was done in terms of 
investigation. After several inquiries I was told the case was being 
sent to Washington to be handled along with other claims against 
Cintas. A few months later the case was dismissed, citing the 
defendant's claims verbatim. I do not believe any real investigation 
was done into my client's case.
    99. We have many problems. In the Detroit area the EEOC office acts 
as a palliative: aggrieved individuals go there, uncounseled as a first 
step in the process. They are often told that they have no case and no 
charges are accepted. How many people with legitimate claims then exit 
the process, demoralized? If they come to us, we have to fight to get 
the charges filed, including writing them ourselves (which I have not 
had rejected but never results in much of an investigation). We get 
almost no feedback on the process. Conciliation ends up undervaluing 
the claims dramatically. There are a few good investigators, but for 
the most part there seems to be no will to question, let alone rebut, 
the proffered explanation of the employers. When we FOIA the records 
afterward there is almost no discovery conducted. There is almost never 
a ``for cause'' finding. I think I have seen at most three or four 
throughout a fifteen year career. Needless to say I have settled many a 
case in which the EEOC found no cause. The administration at our office 
seems completely oblivious to the problems. When the issues are raised, 
the reaction is, ``Well, that is not our policy, so, it must not be 
happening the way you describe it.'' I was on the verge of FOIAing the 
Detroit district office annual reports to use to request some sort of 
Congressional oversight from our senators. My understanding is their 
entire litigation office only brought three cases to litigation in 
2006. This is outrageous.
    120. People who we speak to and send to EEOC on their own have 
reported that they are turned away from the EEOC and their charge is 
rejected.
New Orleans Field Office
    20. Very negative in general. Usually don't understand retaliation 
claims.
    52. Zero knowledge of pretext. EEOC requires direct evidence or 
they dismiss the claim. Also, zero knowledge of the single enterprise 
theory. If the employer says they don't employ 15 people or 50 people, 
etc., EEOC makes no further enquiry. Finally, EEOC requires the 
complainant to sign the questionnaire and charge under penalty of 
perjury, but the employer can respond via unsworn letter or even from 
the company attorney, without being bound by the response.
    124. The whole process is just very slow. It usually takes anywhere 
from 30-60 days to get a response back from the EEOC.
San Antonio Field Office
    50. I've had numerous situations where the client has been told 
it's your word against theirs and it would be a waste of time. 
Employees of the EEOC would try to dissuade the client from filing.
    51. The times that the EEOC has rejected a charge or redrafted it 
were for purely stylistic reasons that in my opinion were unwarranted, 
such as rejecting a 1\1/2\ page charge that supposedly included ``too 
much information.'' This has not happened frequently but it is annoying 
and seems non-sensical when it does happen.
    67. I have a problem with the new process at the San Antonio 
branch. They will not give me a copy of the employer's response but 
will only read it to me over the telephone. Also, I am not notified if 
and when the employer files a response, so I usually just get a letter 
from the investigator regurgitating the employer's position and 
ignoring the witness affidavits that I submitted.
    71. Primary problem is EEOC turning away those who wish to file 
charges when NOT accompanied by a lawyer. They often do not make it to 
a private lawyer until many months later and sometimes miss the state 
180-day deadline or even the federal 300-day deadline because they were 
discouraged from filing what was, in my opinion, a perfectly viable 
claim.
    106. Back in perhaps 2002, the local office refused to accept a 
charge I had prepared. But, it was during the lunch hour, when a back-
up person was working the front desk. When I went later that week 
myself, they accepted my charge with no problems.
    112. I frequently counsel my clients that they WILL meet resistance 
to filing their complaints at the EEOC and they must INSIST that they 
be filed.
    132. Intake investigators do not seem to understand the elementary 
principles of discrimination cases, do not seem to understand the 
significance of certain facts when those facts are presented to them 
during the intake interview, and can hardly write an intelligent 
sentence in either the charge or the affidavit.
    147. Timeliness--even though charge was faxed in timely, but 
received by mail after deadline. Summary conclusion--the charge does 
not apply to any laws we enforce.
    164. Rejecting the charge we prepared, rewriting it and leaving 
things out, refusing to accept a Form 5 from a private attorney.
    170. Unqualified people telling me what does and does not fall 
under Title VII.
Tampa Field Office
    25. Transferring a charge from Tampa to Miami and then not keeping 
me informed of the progress, including after dismissing the charge for 
alleged lack of jurisdiction. Tampa had me on their referral list, but 
I recently found out they had my wrong area code.
    172. I filed a charge where the 300th day was a Sunday. The charge 
was sent by Fed Ex on Friday and delivered on Monday. It was returned 
as untimely. I call the Director and left messages about this but he 
never returned my call. Additionally, within the last year or so I have 
had extreme difficulty getting through to a live person when I call the 
EEOC--I get put into the ``circular voice mail'' thing and end up 
hanging up in frustration.
Seattle Field Office
    35. No meaningful investigation--witnesses not contacted, no 
employer records requested, etc.
    48. I had them ``lose track'' of my client's charge for 9 months.
    171. I think the Seattle EEOC office does a great job and they have 
always been responsive to my clients' need. I live in Anchorage, 
Alaska, and practice statewide in Alaska. We do not have our own EEOC 
office, but the Seattle office makes a big effort to outreach to 
Alaska.
    182. EEOC is now so overworked that I am hesitant to use them for 
anything but getting a NRTS.
Washington Field Office
    63. We have a strong local law and need not exhaust administrative 
remedies first before going to court. Therefore the EEOC is not usually 
involved in most of our cases as we spend most of our time in the 
private sector.
    66. Charges are not promptly prepared after questionnaire is 
completed and submitted. There are long delays in getting the final, 
typed up charge. Often, the language in the final charge is not 
accurate and needs to be corrected; this results in more delay. 
Telephone calls to make appointments, ask questions, inquire about 
status, etc. are not returned. Waiting periods in the lobby are long, 
even if no one else is sitting there.
    97. I practice federal-sector law before the EEOC, and that process 
is slightly different than the private-sector cases. The biggest 
problem in the federal-sector is the inordinate delays in the 
assignment of an EEOC Administrative Judge.
    154. We tend to file charges we prepare ourselves with supporting 
declarations of 5 to 15 pages. In several cases, EEOC has substantially 
delayed processing the charges while they rewrite our charges. As far 
as I can tell, the rewrites are pointless because they don't change the 
substance of the charge.
Boston Area Office
    30. The EEOC told one client that they had too many cases to really 
read his case or deal with it with his since his did not involve a 
termination.
    68. Connecticut is a deferral state, so we have little contact with 
EEOC, other than filing the initial charge. I have had only one case 
that was processed solely by EEOC, since it was filed more than 180 
days after the discriminatory act. EEOC sent the case to mediation 
which was successful. They used a great mediator and I was very happy 
with the outcome.
    89. Basically, I have a problem in their lack of investigation. I 
almost never file directly with the EEOC, but with our State agency. I 
do that even if it is going to get bumped to the EEOC.
    115. In Maine, we file with the Maine Human Rights Commission and 
they forward our charges to the EEOC. I have not known of any charges 
returned to the MHRC during that process but am not sure that I would 
be told about it. I dislike dealing with the EEOC so much that I 
virtually never file directly with them.
Cincinnati Area Office
    32. Two problems: (1) no charge form available online (which is 
ridiculous); and (2) inconsistency between local practice and general 
charge form (which our office had to create from a hard copy ``EEOC 
form.''
    128. I have had several times where the office has been overly 
technical with the content of the charges. I have had charges get lost 
there and have had numerous occasions where I have attempted to get in 
touch with investigators to convey information or inquire into case 
status and my calls have not been returned.
El Paso Area Office
    24. I have been told by investigators that the charge cannot be 
accepted without more detailed information, particularly comparative 
information. The detail required appears to exceed the notice pleading 
standard in federal court.
    73. This survey is not very useful. The multitude of problems which 
charging parties face occur almost exclusively when they are proceeding 
pro se, not when they are represented by counsel. In El Paso, the 
investigators are overwhelmingly unqualified (can't even identify the 
prima facie elements to claims, and have no clue how to investigate). 
There is very little access and transparency, since the District 
Director (out of Dallas), is more interested in closing files and 
denying access to position statements, than he is in having his 
investigators do their job.
    190. Southern New Mexico is now assigned to El Paso, which has 
caused many problems. We used to file in Albuquerque and they did a 
great job. El Paso is slow and also frequently applies 5th Circuit law 
it its analysis--but we're in the 10th. Also they have no discernable 
relationship with New Mexico's state administrative agency. I hear many 
complaints and wish they would change it back!
Kansas City Area Office
    179. I file 90 percent of my client complaints with my state 
agency. The Kansas Human Rights Commission investigative staff makes a 
more thorough and timely investigation of complaints. I receive a 
letter determination for each case with a case investigation report. 
Then we seek review and/or a notice of suit rights from EEOC. I only 
file with EEOC when my client is outside the 180 day period for filing 
a state complaint.
Milwaukee Area Office
    100. EEOC here very much resists letting attorneys draft their own 
charges. They insist on intake interviews and will draft their own 
charges or redraft a charge to suit themselves. We have seen some 
turning away of attempts to file charges but whenever our state 
affiliate hears of it, we get active. It comes in spurts.
    159. Very, very slow investigation of a charge filed in October 
2005. Lack of communication from investigator.
    161. Iowa is a deferral state--so all processing is through the 
Iowa State Civil Rights Commission. My problems with the EEOC all stem 
at the end of the process--getting rights to sue.
Minneapolis Area Office
    27. The only real problem we have with the EEOC is time. We have 
had charges sit for over two years. Most of the time we will pull it 
out and sue, but on class cases where the EEOC hinted we would get PC 
we did not want to do that. Otherwise it has been mostly okay. We have 
more problems with the state human rights department.
    38. I have never had a charge not accepted. A few times in the past 
two years I have had charges merely dismissed because the employer 
denied the charges--a reason I find pretty outlandish to support a 
dismissal of charge.
    107. I have not had any problems with filing--I had a problem with 
a no probable cause finding based on my client's refusal to accept an 
unconditional offer of reinstatement--which goes to damages, not 
liability.
    160. I have received numerous reports from clients who came to me 
after first visiting the EEOC where those clients were told they did 
not have a claim or the intake person at the EEOC refused to prepare 
and file a charge. Consequently, we have begun preparing the entire 
charge, including the text, and filing that--which the EEOC has always 
accepted without change. It's just when a charging party is 
unrepresented and visits the EEOC first that resistance by the EEOC 
occurs. Some investigators are more notorious than others. The intake 
investigators are not attorneys but are making legal decisions. Of 
course, this could be critical if the individual does not first see an 
attorney or delays seeing an attorney until after the charging party's 
deadline has passed.
Nashville Area Office
    153. It takes about 9 months to a year for the EEOC to complete its 
investigation. I don't know how that compares to other offices.
    166. I have never had a problem but individuals have expressed to 
me about 6 to 10 times over last 2 or 3 years that the EEOC intake 
person said that they did not have claim and did not take a charge. I 
do not know if it is true but I believe they must be discouraging 
employees from filing charges.
Newark Area Office
    54. Very slow follow-up on the part of the investigators. Lack of 
good training or knowledge of the law by investigators, who routinely 
reject cases that are then won in court or settled.
Pittsburgh Area Office
    102. In my experience, the Pittsburgh office does an excellent job 
processing charges no matter what is alleged. It will take the charge, 
evaluate it as required and then make a decision. While I don't agree 
with the decisions made, my experience is that they do not dismiss a 
charge out of hand.
    117. When charges are transferred from Pittsburgh to Cleveland, I 
am not notified and at times when there is more than one Respondent, 
not all the charges are transferred together.
Raleigh Area Office
    12. I have not personally had any problems with the EEOC. However, 
I am aware of several clients who have experienced problems with having 
the EEOC accept their charges of discrimination and/or omit claims from 
the charge that the EEOC prepared (which were clearly covered in the 
intake questionnaire).
Buffalo Local Office
    61. EEOC investigator objected to describing specific health 
condition in ADA charge.
    123. My comment is neither profound nor new. The EEOC has very 
limited resources. The quality of a decent percentage of the 
investigators is not terribly high. They do not require a college 
degree and are being asked to evaluate issues that many lawyers outside 
the employment field would not immediately get. If private counsel is 
involved, my view is that they should either partner with them if the 
agency is interested in the case or willing to help, or otherwise 
simply stay out of the case so as not to mess stuff up. They should 
concentrate their resources on good cases brought by those without an 
attorney.
    189. Office failed to respond to status inquiries for an extended 
period of time and then refused to perform investigation.
Norfolk Local Office
    126. The Norfolk EEOC office is WOEFULLY understaffed. Just over a 
year ago the office had 12 investigators--it now has 5. EEOC personnel 
are working valiantly, but there are simply not enough of them. My 
clients are best protected from ``frivolous'' lawsuit claims by a cause 
finding. Obtaining one, however, can take over a year.
Richmond Local Office
    81. EEOC has done almost no meaningful investigation: no follow-up 
after receipt of employer's position paper; no interest in contacting 
witnesses, etc.
    125. Once charges are filed, it is often months or even years 
before anything is done or the charge is even assigned to an 
investigator.
San Juan Local Office
    184. Very high rate of ``no cause'' rulings without any 
investigation.
Savannah Local Office
    130. During reorganization last year, we were reassigned from the 
Greenville, South Carolina office to the Savannah, Georgia office, and 
have encountered some problems with filing, and some problems with one 
particular investigator who did not conduct much of an investigation, 
and sent the right to sue letter after several months directly to our 
client's mother, despite the fact that I left a number of messages over 
the course of 3 months, to which he never responded. It was clear on 
our paperwork that we were her attorneys from the start. The Savannah 
office does not seem to have been able to hire additional personnel, 
despite having a significant portion of South Carolina added to their 
region.
                                 ______
                                 
         Prepared Statement of the Investment Company Institute
    The Investment Company Institute appreciates this opportunity to 
submit testimony to the Subcommittee in support of the Administration's 
fiscal year 2008 Appropriations request for the Securities and Exchange 
Commission (SEC). We commend the Subcommittee for its consistent past 
efforts to assure adequate resources for the SEC.
    Mutual funds are an integral part of the U.S. economy and continue 
to be one of America's primary savings and investment vehicles for 
middle-income Americans. Since 1990, the percentage of U.S. retirement 
assets held in mutual funds has more than quadrupled. Today, more than 
96 million investors in nearly 55 million U.S. households own mutual 
fund shares; the median household income of fund shareholders is 
$68,700. These millions of ordinary Americans continue to recognize 
that mutual funds are the best means of achieving their long-term 
financial goals. They deserve and benefit from continued vigilant 
regulatory oversight of mutual funds.
    In addition to their role as the investment vehicle of choice for 
millions of Americans, mutual funds are major investors in securities 
and participants in the marketplace. As such, they have a strong 
interest in assuring the SEC's continued ability to soundly and 
effectively regulate securities offerings, other market participants, 
and the markets themselves.
    For all of these reasons, sufficient funding of the SEC is 
critically important to the Institute and its members.
    The Administration's fiscal year 2008 budget proposes SEC funding 
at a level of $905.3 million, which is a very slight increase from the 
$904 million appropriated in fiscal year 2007. The SEC has determined 
that this level provides it with adequate funding to fulfill its 
regulatory mandate and to continue protecting the nation's investors. 
Accordingly, the Institute urges Congress to provide appropriations at 
this funding level.
    We believe it is significant that the SEC has specifically 
requested funding to allow it to continue to invest resources in 
technology. We are particularly pleased that the top strategic 
priorities for the SEC's Division of Investment Management include 
revamping the mutual fund disclosure regime by making disclosures more 
useful to investors through better use of new technologies, such as 
interactive data tagging (XBRL) and the Internet. Division Director 
Andrew Donohue recently outlined plans to develop a short-form 
disclosure document for fund investors, which would be coupled with 
giving investors the ability to obtain additional information via the 
Internet or in paper form.\1\ As Director Donohue said, mutual fund 
shareholders ``deserve a streamlined disclosure system that better 
meets their needs and is consistent with the manner in which most 
Americans retrieve and process information in the 21st century.'' We 
agree, and we strongly support funding for these important initiatives.
---------------------------------------------------------------------------
    \1\ Speech by SEC Director of the Division of Investment Management 
Andrew J. Donohue, Keynote Address at the 2007 ICI Mutual Funds and 
Investment Management Conference, March 26, 2007.
---------------------------------------------------------------------------
    While providing adequate funding is vitally important, it is 
equally important that the SEC deploy available resources in ways 
designed to assure the effectiveness of its regulatory and law 
enforcement efforts. We therefore strongly support the continued focus 
on internal reforms that will improve the performance of the SEC. This 
includes, for example, providing regulatory guidance that better 
anticipates issues, developing closer integration of the activities of 
different SEC divisions and branch offices, implementing new inspection 
strategies, and conducting empirical research that informs major 
rulemakings. Indeed, the importance of these kinds of reforms has been 
underscored in a series of recent reports.\2\ We support appropriate 
funding of the SEC to facilitate these and other initiatives to enhance 
the effectiveness of the SEC.
---------------------------------------------------------------------------
    \2\ See Interim Report of the Committee on Capital Markets 
Regulation (November 30, 2006, as revised on December 5, 2006); Report 
of the U.S. Chamber of Commerce, Commission on the Regulation of U.S. 
Capital Markets in the 21st Century (March 2007); and Sustaining New 
York's and the U.S.' Global Financial Services Leadership (January 
2007).
---------------------------------------------------------------------------
    In conclusion, the SEC and the fund industry share a common 
objective of assuring that mutual funds remain a vibrant, competitive 
and cost effective way for average Americans to access the securities 
markets and realize their long-term financial goals. Future regulatory 
and oversight actions by the SEC will play a key part in this process. 
It is therefore critically important that the SEC have sufficient 
resources to enable it to be an effective and efficient regulator and 
fulfill its mission of protecting the nation's investors, including the 
more than 91 million Americans who own mutual funds. Accordingly, we 
support providing the SEC with the requested level of funding.
    We appreciate your consideration of our views.
    The Investment Company Institute is the national association of 
American investment companies. ICI members include 8,821 open-end 
investment companies (mutual funds), 664 closed-end investment 
companies, 385 exchange-traded funds, and 4 sponsors of unit investment 
trusts. Mutual fund members of the ICI have total assets of 
approximately $10.481 trillion (representing 98 percent of all assets 
of U.S. funds); these funds serve approximately 93.9 million 
shareholders in more than 53.8 million households.
                                 ______
                                 

      Prepared Statement of the National Treasury Employees Union

    Chairman Durbin, ranking member Brownback, and distinguished 
members of the subcommittee, I would like to thank you for allowing me 
to provide comments on the administration's fiscal year 2008 budget 
request for the Internal Revenue Service (IRS). As President of the 
National Treasury Employees Union (NTEU), I have the honor of 
representing over 150,000 Federal workers in 30 agencies including the 
men and women at the IRS.
                  irs fiscal year 2008 budget request
    Mr. Chairman, as you know, the IRS budget forms the foundation for 
what the IRS can provide to taxpayers in terms of customer service and 
how the agency can best fulfill its tax enforcement mission. Without an 
adequate budget, the IRS cannot expect continued improvement in 
customer service performance ratings and will be hampered in its effort 
to enhance taxpayer compliance. I would like to applaud the 
administration for acknowledging in its fiscal year 2008 Budget in 
Brief (page 65) that ``assisting the public to understand their tax 
reporting and payment obligations is the cornerstone of taxpayer 
compliance and is vital for maintaining public confidence in the tax 
system.'' However, I was disappointed in the administration for failing 
to request a budget for fiscal year 2008 that meets the needs of the 
Agency to meet its customer service and enforcement challenges. In 
fact, the President's budget anticipates a ``savings'' equal to nearly 
1,200 full-time equivalent positions, including 1,147 in enforcement 
and taxpayer service programs.
    Although it's widely recognized that additional funding for 
enforcement provides a great return on the investment, the 
administration seems reluctant to request an adequate budget for the 
IRS. In addition, despite citing a lack of resources as the primary 
rationale for contracting out a number of inherently governmental 
activities, such as the collection of taxes, the Commissioner of the 
IRS has told Congress that the IRS does not need any additional funding 
above the President's budget request.
    NTEU believes that Congress must provide the IRS with a budget that 
will allow the Service to replenish the depleted workforce, 
particularly with respect to enforcement personnel.
    History has shown that the IRS has the expertise to improve 
taxpayer compliance but lacks the necessary personnel and resources. 
The President's own fiscal 2008 budget proposal trumpets the increased 
tax collections produced by IRS's own employees and cites the increased 
collections of delinquent tax debt from $34 billion in 2002 to $49 
billion in 2006, an increase of 44 percent. Unfortunately, instead of 
providing additional resources to hire more enforcement staff, IRS 
personnel resources have been slashed in recent years resulting in a 36 
percent decline in combined collection and examination function 
enforcement staff between 1996 and 2003. In addition, these staffing 
cuts have come at a time when the IRS workload has dramatically 
increased.
    According to IRS's own annual reports and data, taxpayers filed 
114.6 million returns in 1995. After a steady annual climb, 11 years 
later, the Service saw more than 132 million returns filed. Yet, 
between 1995 and 2005, total numbers of IRS employees shrunk from 
114,000 to 94,000. Even more alarming is that during that period, 
revenue officers and revenue agents--two groups critical to IRS 
enforcement and compliance efforts--shrunk by 32 and 23 percent 
respectively. Revenue officers who collect large delinquent accounts 
went from 8,139 to 5,462 and revenue agents who do audits fell from 
16,078 to 12,355. Unfortunately, instead of reversing this trend, the 
IRS has continued efforts to reduce its workforce and has moved forward 
with downsizing in several different areas which have targeted some of 
the Service's most productive employees.
    These include last year's re-organization of the Estate and Gift 
Tax Program which sought the elimination of 157 of the agency's 345 
estate and gift tax attorneys--almost half of the agency's estate tax 
lawyers--who audit some of the wealthiest Americans. The Service 
pursued this drastic course of action despite internal data showing 
that estate and gift attorneys are among the most productive 
enforcement personnel at the IRS, collecting $2,200 in taxes for each 
hour of work.
    The IRS decision to drastically reduce the number of attorneys in 
the estate and gift tax area flies in the face of several reports made 
to Congress by Treasury and IRS officials over the past few years, 
indicating that tax evasion and cheating among the highest-income 
Americans is a serious and growing problem. In fact, an IRS study found 
that in 1999, more than 80 percent of the 1,651 tax returns reporting 
gifts of $1 million or more that were audited that year understated the 
value of the gift. The study found that the average understatement was 
about $303,000, on which about $167,000 in additional gift taxes was 
due. This alone cost the government about $275 million. Consequently, 
it is difficult to understand why the IRS sought the elimination of key 
workforce positions in an area that could produce significant revenue 
to the general treasury.
    In addition, the Service continues to move forward with its plan to 
close five of its ten paper tax return submission facilities by 2011. 
The IRS originally sought the closings of the five paper return 
submission centers due to the rise in the use of electronic filing (e-
filing) and in order to comply with the IRS Restructuring and Reform 
Act of 1998 (RRA 98) which established a goal for the IRS to have 80 
percent of Federal tax and information returns filed electronically by 
2007. But in their recent report to Congress on e-filing, the IRS 
Oversight Board noted that the IRS will fall well short of the 80 
percent goal and urged Congress to extend the deadline to 2012. The 
report noted that in 2006 just 54 percent of individuals e-filed their 
returns, well short of the 80 percent goal. Furthermore, the report 
cited a decline in 2006 in the number of e-file returns received from 
individual taxpayers who self-prepared their taxes. And finally a 
recent GAO report on the 2006 filing season noted the year over year 
percentage growth in individual e-filing slowed to a level lower than 
any of the previous 3 years.
    While overall use of e-filing may be on the rise, the number of 
taxpayers opting to use this type of return is not increasing as 
rapidly as the IRS had originally projected. Combined with the fact 
that almost a third of American taxpayers do not even have internet 
access and changes to the IRS Free File Program that are expected to 
increase the number of paper filing returns, it is clear that paper 
submission processing facilities are still necessary and that serious 
thought and consideration must be given before any additional closings 
are undertaken.
    Mr. Chairman, it is clear that drastic reductions in some of the 
agency's most productive tax law enforcement employees directly 
contradict the Service's stated enforcement priority to discourage and 
deter non-compliance, particularly among high-income individuals. In 
addition, we believe these staffing cuts have greatly undermined agency 
efforts to close the tax gap which the IRS recently estimated at $345 
billion. As Nina Olson, the National Taxpayer Advocate noted, this 
amounts to a per-taxpayer ``surtax'' of some $2,600 per year to 
subsidize noncompliance. And while the agency has made small inroads 
and the overall compliance rate through the voluntary compliance system 
remains high, much more can and should be done. NTEU believes that in 
order to close the tax gap, the IRS needs additional employees on the 
frontlines of tax compliance and customer service. In addition, we 
believe Congress should establish a dedicated funding stream to provide 
adequate resources for those employees.
                         nteu staffing proposal
    In order to address the staffing shortage at the IRS, NTEU supports 
a 2 percent annual net increase in staffing (roughly 1,885 positions 
per year) over a 5-year period to gradually rebuild the depleted IRS 
workforce to pre-1998 levels. A similar idea was proposed by former IRS 
Commissioner Charles Rossotti in a 2002 report to the IRS Oversight 
Board. In the report, Rossotti quantified the workload gap in non-
compliance, that is, the number of cases that should have been, but 
could not be acted upon because of resource limitations. Rossotti 
pointed out that in the area of known tax debts, assigning additional 
employees to collection work could bring in roughly $30 for every $1 
spent. The Rossotti report recognized the importance of increased IRS 
staffing noting that due to the continued growth in IRS' workload 
(averaging about 1.5 to 2.0 percent per year) and the large accumulated 
increase in work that should be done but could not be, even aggressive 
productivity growth could not possibly close the compliance gap. 
Rossotti also recognized that for this approach to work, the budget 
must provide for a net increase in staffing on a sustained yearly basis 
and not take a ``one time approach.''
    Although this would require a substantial financial commitment, the 
potential for increasing revenues, enhancing compliance and shrinking 
the tax gap makes it very sound budget policy. One option for funding a 
new staffing initiative would be to allow the IRS to hire personnel 
off-budget, or outside of the ordinary budget process. This is not 
unprecedented. In fact, Congress took exactly the same approach to 
funding in 1994 when Congress provided funding for the administration's 
IRS Tax Compliance Initiative which sought the addition of 5,000 
compliance positions for the IRS. The initiative was expected to 
generate in excess of $9 billion in new revenue over 5 years while 
spending only about $2 billion during the same period. Because of the 
initiative's potential to dramatically increase Federal revenue, 
spending for the positions was not considered in calculating 
appropriations that must come within annual caps.
    A second option for providing funding to hire additional IRS 
personnel outside the ordinary budget process could be to allow IRS to 
retain a small portion of the revenue it collects. The statute that 
gives the IRS the authority to use private collection companies to 
collect taxes allows 25 percent of collected revenue to be returned to 
the companies as payment, thereby circumventing the appropriations 
process altogether. Clearly, there is nothing magical about revenues 
collected by private collection companies. If those revenues can be 
dedicated directly to contract payments, there is no reason some small 
portion of other revenues collected by the IRS could not be dedicated 
to funding additional staff positions to strengthen enforcement.
    While NTEU agrees with IRS' stated goal of enhancing tax compliance 
and enforcement, we don't agree with the approach of sacrificing 
taxpayer service in order to pay for additional compliance efforts. 
That is why we were disappointed to see that the President's proposed 
budget calls for the elimination of 527 taxpayer services positions. 
NTEU believes providing quality services to taxpayers is an important 
part of any overall strategy to improve compliance and that reducing 
the number of employees dedicated to assisting taxpayers meet their 
obligations will only those efforts. The administration's own budget 
proposal for 2008 notes that in fiscal year 2006, IRS' customer 
assistance centers answered almost 33 million assistor telephone calls 
and met the 82 percent level of service goal, with an accuracy rate of 
91 percent for tax law questions. In addition, a recent study 
commissioned by the Oversight Board found that more than 80 percent of 
taxpayers contacted said that IRS service was better than or equal to 
service from other government agencies. And while these numbers show 
that IRS taxpayer services are being effective, more can and should be 
done.
    Mr. Chairman, in order to continue to make improvements in taxpayer 
services while simultaneously processing a growing number of tax 
returns and stabilizing collections and examinations of cases, it is 
imperative to reverse the severe cuts in IRS staffing levels and begin 
providing adequate resources to meet these challenges. With the future 
workload expected to continue to rise, the IRS will be under a great 
deal of pressure to improve customer service standards while 
simultaneously enforcing the Nation's tax laws. NTEU strongly believes 
that providing additional staffing resources would permit IRS to meet 
the rising workload level, stabilize and strengthen tax compliance and 
customer service programs and allow the Service to address the tax gap 
in a serious and meaningful way.
                            span of control
    And while it is imperative that Congress provide the IRS with 
sufficient staffing resources, we also believe that the IRS should look 
at the management to bargaining unit employee ratio to find additional 
resources for increased frontline tax compliance efforts. As noted 
previously, while the number of employees at the IRS has decreased by 
almost 20,000 since 1995, the number of managers who supervise these 
employees has increased over this same period. If we just look at the 
period between 2000 and 2005, we see that the number of bargaining unit 
employees, the frontline employees who do the work, decreased by 4,756, 
a decrease of 5.1 percent. During that same time, the number of 
managers and management officials increased by 170, an increase of 1 
percent. If the IRS decreased the number of managers and management 
officials at the same rate as it decreased its rank and file employees 
during that period, there would be 5.1 percent fewer managers and 
management officials or a savings of 808 full time equivalents (FTE's) 
that could be saved and redirected to the frontlines. While the IRS has 
previously cited concerns about the number of employees that would have 
to be taken offline to train additional frontline employees, we believe 
this training could be done with minimal disruption to current 
operations. One possibility would be to use the increasing number of 
managers and management officials to do the training. This would ensure 
that these employees are afforded the best possible training while 
allowing current operations to continue to run efficiently.
                         private tax collection
    Mr. Chairman, as stated previously, if provided the necessary 
resources, IRS employees have the expertise and knowledge to ensure 
taxpayers are complying with their tax obligations. That is why NTEU 
continues to strongly oppose the administration's private tax 
collection program, which began in September of last year. Under the 
program, the IRS is permitted to hire private sector tax collectors to 
collect delinquent tax debt from taxpayers and pay them a bounty of up 
to 25 percent of the money they collect. NTEU believes this misguided 
proposal is a waste of taxpayer's dollars, invites overly aggressive 
collection techniques, jeopardizes the financial privacy of American 
taxpayers and may ultimately serve to undermine efforts to close the 
tax gap.
    NTEU strongly believes the collection of taxes is an inherently 
governmental function that should be restricted to properly trained and 
proficient IRS personnel. When supported with the tools and resources 
they need to do their jobs, there is no one who is more reliable and 
who can do the work of the IRS better than IRS employees.
    As you may know, under current contracts, private collection firms 
are eligible to retain 21 percent to 24 percent of what they collect, 
depending on the size of the case. In testimony before Congress, former 
IRS Commissioner Mark Everson repeatedly acknowledged that using 
private collection companies to collect Federal taxes will be more 
expensive than having the IRS do the work itself. The Commissioner's 
admission directly contradicts one the administration's central 
justifications for using private collection agencies--that the use of 
private collectors is cost efficient and effective.
    In addition to being fiscally unsound, the idea of allowing private 
collection agencies to collect tax debt on a commission basis also 
flies in the face of the tenets of the IRS Restructuring and Reform Act 
of 1998. Section 1204 of the law specifically prevents employees or 
supervisors at the IRS from being evaluated on the amount of 
collections they bring in. But now, the IRS has agreed to pay private 
collection agencies out of their tax collection proceeds, which will 
clearly encourage overly aggressive tax collection techniques, the 
exact dynamic the 1998 law sought to avoid. Furthermore, the IRS is 
turning over tax collection responsibilities to an industry that has a 
long record of abuse. For example, in 2006, consumer complaints about 
third-party debt collectors increased both in absolute terms and as a 
percentage of all complaints that consumers filed with the Federal 
Trade Commission (FTC). Last year the FTC received 69,204 consumer 
complaints about debt collection agencies--giving debt collectors the 
impressive title of the FTC's most complained-about industry.
    NTEU believes that a better option would be to provide the IRS with 
the resources and staffing it needs. There is no doubt that IRS 
employees are--by far--the most reliable, cost-effective means for 
collecting Federal income taxes. As noted previously, the former IRS 
Commissioner himself has admitted that using IRS employees to collect 
unpaid tax debts is more efficient than using private collectors. In 
addition, the 2002 budget report submitted to the IRS Oversight Board, 
former Commissioner Charles Rossotti made clear that with more 
resources to increase IRS staffing, the IRS would be able to close the 
compliance gap.
    This is not the first time the IRS has tried this flawed program. 
Two pilot projects were authorized by Congress to test private 
collection of tax debt for 1996 and 1997. The 1996 pilot was so 
unsuccessful it was cancelled after 12 months, despite the fact it was 
authorized and scheduled to operate for 2 years. A subsequent review by 
the IRS Office of Inspector General found that contractors 
participating in the pilot programs regularly violated the Fair Debt 
Collection Practices Act, did not adequately protect the security of 
personal taxpayer information, and even failed to bring in a net 
increase in revenue. In fact, a 1997 GAO report found that private 
companies did not bring in anywhere near the dollars projected, and the 
pilot caused a $17 million net loss.
    Despite IRS assurances that it has learned from its past mistakes, 
two recent reports indicate otherwise. A March 2004 report by the 
Treasury Inspector General for Tax Administration raised a number of 
questions about IRS' contract administration and oversight of 
contractors. The report found that ``a contractor's employees committed 
numerous security violations that placed IRS equipment and taxpayer 
data at risk'' and in some cases, ``contractors blatantly circumvented 
IRS policies and procedures even when security personnel identified 
inappropriate practices.'' (TIGTA Audit #200320010). The proliferation 
of security breaches at a number of government agencies that put 
personal information at risk further argue against this proposal. These 
security breaches illustrate not only the risks associated with 
collecting and disseminating large amounts of electronic personal 
information, but the risk of harm or injury to consumers from identity 
theft crimes.
    In addition, a September 2006 examination of the IRS private 
collection program by the Government Accountability Office (GAO) 
reveals that like the 1996 pilot, the program may actually lose money 
by the scheduled conclusion of the program's initial phase in December 
2007. The report cited preliminary IRS data showing that the agency 
expects to collect as little as $56 million through the end of 2007, 
while initial program costs are expected to surpass $61 million. What's 
more, the projected costs do not even include the 21-24 percent 
commission fees paid to the collection agencies directly from the taxes 
they collect.
    In addition to the direct costs of the program, I am greatly 
concerned about the potential negative effect that the private tax 
collection program will have on our tax administration system. In her 
recent report to Congress, the National Taxpayer Advocate voiced 
similar concern about the unintended consequences of privatizing tax 
collection. Olson cited a number of ``hidden costs'' that private tax 
collection has on the tax system including reduced transparency of IRS 
tax collection operations, inconsistent treatment for similarly 
situated taxpayers, and reduced tax compliance. Clearly the negative 
effects of contracting out tax collection to private collectors hampers 
the agency's ability to improve taxpayer compliance and will only serve 
to undermine future efforts to close the tax gap.
    NTEU is not alone in its opposition to the IRS' plan. Similar 
proposals allowing private collection agencies to collect taxes on a 
commission basis have been around for a long time and have consistently 
been opposed by both parties. In fact, the Reagan Administration 
strongly opposed the concept of privatizing tax collections warning of 
a considerable adverse public reaction to such a plan, and emphasizing 
the importance of not compromising the integrity of the tax system. 
(Treasury Dept. Statement to House Judiciary Comm. 8/8/86). More 
recently, opposition to the private tax collection program has been 
voiced by a growing number of members of Congress, major public 
interest groups, tax experts, as well as the Taxpayer Advocacy Panel, a 
volunteer Federal advisory group--whose members are appointed by the 
IRS and the Treasury Department. In addition, the National Taxpayer 
Advocate, an independent official within the IRS recently identified 
the IRS private tax collection initiative as one of the most serious 
problems facing taxpayers and called on Congress to immediately repeal 
the IRS' authority to outsource tax collection work to private debt 
collectors (National Taxpayer Advocate 2006 Report to Congress).
    Instead of rushing to privatize tax collection functions which 
jeopardizes taxpayer information, reduces potential revenue for the 
Federal Government and undermine efforts to close the tax gap, the IRS 
should increase compliance staffing levels at the IRS to ensure that 
the collection of taxes is restricted to properly trained and 
proficient IRS personnel.
    irs audits of high-income individuals and large businesses and 
                              corporations
    Mr. Chairman, the final issue that I would like to discuss is IRS 
enforcement efforts with regard to high-income individuals and large 
businesses and corporations. I previously noted the drastic staff 
reductions in the estate and gift tax division that occurred last year 
and will obviously hamper the Service's ability to achieve greater 
compliance from the wealthiest Americans. In addition, recent IRS data 
shows that IRS audits of high-income individuals have dropped 
dramatically over the past decade. The audit rate for face-to-face 
audits fell from 2.9 percent of high-income tax filers in fiscal year 
1992 to 0.38 percent in fiscal year 2001 and then drifted down to 0.35 
percent in fiscal year 2004. While the audit rate has rebounded 
somewhat in the last 2 years, it is still far below the level of the 
mid-1990's. These facts seem to directly contradict claims by the IRS 
that the Service's first enforcement priority is to discourage and 
deter non-compliance, with an emphasis on high-income individuals.
    We are seeing similar troubling trends with respect to large 
corporations. While this issue has just started receiving public 
attention in recent weeks, it has long been of concern to IRS employees 
that believe recent IRS currency and cycle time initiatives are 
resulting in the premature closing of audits of large companies, 
possibly leaving hundreds of millions of dollars of taxes owed on the 
table. IRS data shows the thoroughness of IRS enforcement efforts for 
the Nation's largest corporations--measured by the number of hours 
devoted to each audit--has substantially declined since fiscal year 
2002. IRS data also show that the annual audit rates for these 
corporations, all with assets of $250 million or more, while increasing 
in fiscal year 2004 and 2005, receded in 2006 to about the level it was 
in 2002 and is much lower than levels that prevailed a decade or more 
ago.
    Although the number of the largest corporations is small, they are 
a very significant presence in the American economy. In fiscal year 
2002, the largest corporations were responsible for almost 75 percent 
of all additional taxes the IRS auditors said were owed the government. 
By comparison, low and middle income taxpayers in the same year were 
responsible for less than 10 percent of the total.
    Agency data shows that audit attention given those corporations 
with $250 million or more in assets has substantially declined in the 
last 5 years. In 2002, an average of 1,210 hours were devoted to each 
of the audits of the corporations in this category. The time devoted to 
each audit dropped sharply in 2004 and by 2006 the number of hours per 
audit remained 20 percent below what it was in 2002.
    But what may be most disturbing is that according to IRS' own data, 
while the coverage rate of large corporation returns (identified as 
those with assets of $10 million and higher) increased in fiscal year 
2004 and 2005, the number of audits for these corporations actually 
decreased in 2006. Clearly, the rationale the IRS is using to justify a 
reduction in time and scope of large corporation audits, that is, to 
allow for expanding the total number of companies audited is not 
working.
    IRS officials have continued to point to a rise in additional tax 
recommended for each hour of audit as a sign that the policy is 
working, but most auditors know that this rise can be primarily 
attributed to the proliferation of illegal tax shelters which makes it 
easier to find additional taxes due.
    Warnings about the potential negative consequences of such policy 
decisions were made by a number of IRS employees in a recent New York 
Times article and are not new. In fact, when the IRS first began 
limiting the time and scope of business audits through implementation 
of the Limited Issue Focused Examination (LIFE) process in 2002, the 
former chief counsel of the IRS said that the IRS' proposed reductions 
in cycle time of corporate audits would ``virtually guarantee that IRS 
auditors would miss tax dodges, fail to explore suspicious 
transactions, or even walk away from audits that are on the verge of 
finding wrongdoing.''
    In addition, IRS employees have raised concerns about this shift in 
approach to the auditing of business tax returns since its 
implementation several years ago. Their concerns are multi-fold. 
Primarily, employees' feel that their experience and professional 
judgment is being ignored when the scope of audits is limited and cycle 
times are reduced. Revenue agents need flexibility to determine the 
scope of an audit and need the ability to expand the examination time 
when necessary. The men and women of the IRS that perform these audits 
are highly experienced employees who know which issues to examine and 
when more time is necessary on a case. But under current IRS policies, 
this is just not the case.
    Mr. Chairman, we have heard directly from a number of our members 
about the detrimental effect this policy has had not just on efforts to 
ensure corporations are in full compliance, but also how this misguided 
policy is damaging employee morale. In one instance, an IRS agent with 
29 years of experience, including 19 as an international specialist 
examining tax returns of large, multinational corporations was given an 
unreasonably short period of time to examine 3 tax years of a very 
large company. The agent reported being constantly harassed for 
refusing to further limit the scope of the examination beyond that 
which was set at the beginning of the audit, even though he had 
successfully completed two prior examinations of the same taxpayer in a 
timely manner. The employee knew the issues and how to examine them but 
also knew they would need more than the allotted time to complete his 
part of the examination. But, despite past successes, management 
refused to provide the employee with additional time to complete his 
portion of the audit and labeled the employee as uncooperative and not 
a ``team player.'' Although the employee refused to compromise, he 
believed that other members of the examination team had been pressured 
into dropping issues which likely would have resulted in additional 
tax.
    Mr. Chairman, in the face of a rising tax gap and exploding Federal 
deficits, it is imperative that the agency is provided with the 
necessary resources to allow IRS professionals to pursue each and every 
dollar of the taxes owed by large businesses and corporations. Allowing 
these corporations to pay just a fraction of what they owe in taxes 
greatly hinders efforts to close the tax gap and is fundamentally 
unfair to the millions of ordinary taxpayers that dutifully pay their 
taxes. Only by increasing the overall number of IRS employees that do 
this work can the Service ensure that businesses and large corporations 
are complying with their tax obligations and that the tax gap is being 
closed.
                               conclusion
    It is an indisputable fact that the IRS workforce is getting mixed 
signals regarding its value to the mission of the Service and the level 
of workforce investment the Service is willing to make. NTEU believes 
that the drastic reductions of some of the IRS's most productive 
employees, reliance on outside contractors to handle inherently 
governmental activities such as the collection of taxes, and a shift in 
philosophy which focuses enforcement efforts too much on wage earners 
and not enough on high-income individuals and large businesses and 
corporations, only serve to undermine the agency's ability to fulfill 
its tax enforcement mission and hamper efforts to close the tax gap.
                                 ______
                                 
          Prepared Statement of the Pacific Salmon Commission
    Mr. Chairman, my name is Roland Rousseau and I serve as an 
alternate commissioner on the Pacific Salmon Commission (PSC) and the 
chair of the Budget Committee for the U.S. section of the Commission. 
The Pacific Salmon Treaty (Treaty) between the United States and Canada 
was established in 1985. An subsequent agreement was concluded in June 
of 1999 (1999 agreement) that established new abundance-based fishing 
regimes under the treaty and made other improvements in the treaty's 
structure. During fiscal year 2008, the PSC will conduct very important 
negotiations to renew provisions of treaty fishing regimes that are 
scheduled to expire at the end of 2008. The U.S. section recommends 
that Congress:
    For Department of Commerce:
  --Fund the Pacific Salmon Treaty line item of the National Marine 
        Fisheries Service at $8,000,000 for fiscal year 2008, restoring 
        $1,000,000 previously provided by Congress. This funding 
        provides the technical support for the States of Alaska, 
        Washington, Oregon and Idaho and the National Marine Fisheries 
        Service to conduct the salmon stock assessment and fishery 
        management programs required to implement the treaty fishing 
        regimes. Included within the total amount of $8,000,000 is 
        $400,000 to continue a joint Transboundary River Enhancement 
        Program required by the treaty.
  --Fund the Pacific Salmon Treaty Chinook Salmon Agreement line item 
        of the National Marine Fisheries Service for fiscal year 2008 
        at $1,844,000, level funding from what was provided by Congress 
        for fiscal year 2006. This funding continues to be necessary to 
        acquire the technical information to implement abundance-based 
        Chinook salmon management provided for under the 1999 
        agreement.
    For Department of State fund the PSC at $3,049,000, under 
International Fisheries Commission, Department of State. This is 
approximate level funding from that provided in fiscal year 2006 to 
fund the bilateral PSC office and staff, and to support U.S. section 
activities required to implement provisions of the treaty. Funding for 
the total International Fisheries Commission line item should be 
$24,000,000, the funding level for fiscal year 2006, to provide full 
funding for the operations of all the fishery commissions, including 
the PSC.
    The base treaty implementation projects include a wide range of 
stock assessment, fishery monitoring, and technical support activities 
for all five species of Pacific salmon in the fisheries and rivers from 
Southeast Alaska to those of Washington, Oregon, and Idaho. The States 
of Alaska, Washington, Oregon, and Idaho, and the National Marine 
Fisheries Service (NMFS), are charged with carrying out major portions 
of the salmon fishery stock assessment and harvest management actions 
required under the treaty. Federal funding for these activities is 
provided through NMFS on an annual basis. The agency projects carried 
out under PSC funding are directed toward acquiring, analyzing, and 
sharing the information required to implement the salmon conservation 
and sharing principles of the treaty. A wide range of programs for 
salmon stock size assessments, escapement enumeration, stock 
distribution, and catch and effort information from fisheries, are 
represented. The information from many of these programs is used 
directly to establish fishing seasons and harvest levels. Congress 
increased this funding by $2,000,000 in fiscal year 2005 to a total of 
$8,000,000 to provide for programs needed to implement the new 
abundance-based fishing regimes established under the 1999 agreement, 
but the level was reduced to $7,000,000 in fiscal year 2006. The U.S. 
section recommends that $8,000,000 be restored in fiscal year 2008 to 
allow full implementation of treaty provisions. The 1999 agreement 
updated provisions of the Pacific Salmon Treaty including fishing 
arrangements and abundance-based management approaches for Chinook, 
southern coho, Northern Boundary and Transboundary River fisheries. The 
$400,000 that has been provided since 1988 for a joint Transboundary 
River enhancement program with Canada is included in this amount.
    In 1996, the United States adopted an abundance-based approach to 
managing Chinook salmon fisheries in Southeast Alaska. Under this 
approach, Chinook harvest levels are based on annual estimates of 
Chinook abundance. This system replaced fixed harvest ceilings agreed 
to in 1985, which did not respond to annual fluctuations in Chinook 
salmon populations. The revised 1999 agreement adopted this abundance-
based management approach for all Chinook fisheries subject to the 
treaty. In recognition of this new management approach, since 1998, 
Congress has provided $1,844,000 annually to allow for the collection 
of stock assessment and fishery management information necessary for 
implementation. Through a rigorous competitive technical review 
process, the States of Alaska, Washington, Oregon, and Idaho, and the 
24 treaty tribes are using the funding to implement abundance-based 
Chinook salmon management coast-wide under the new agreement. The U.S. 
section recommends level funding of $1,844,000 for fiscal year 2008 to 
support the implementation of abundance-based Chinook salmon 
management.
    The United States and Canada agreed in 1988 to a joint salmon 
enhancement program on the Transboundary Rivers, which rise in Canada 
and flow to the sea through Southeast Alaska. Since 1989, Congress has 
provided $400,000 annually for this effort through the National Marine 
Fisheries Service International Fisheries Commission line item under 
the Conservation and Management Operations activity. Canada provides an 
equal amount of funding and support for this bilateral program. This 
funding is included in the $8,000,000 the U.S. section is recommending 
for the fiscal year 2008 Pacific Salmon Treaty line item.
    The U.S. section of the PSC recommends that $3,049,000 for 
implementation of the treaty be provided in the Department of State's 
International Fisheries Commissions line item in fiscal year 2008. This 
is $20,000 more than the amount provided by Congress for fiscal year 
2006 and is vitally needed to support U.S. commitments made in the 1999 
agreement and support costs for U.S. section participation. This 
funding provides for the United States contribution to the bilateral 
PSC staff and offices based in Vancouver, British Columbia. It also 
provides for travel for U.S. commissioners, panel members, and 
technical committee members and stipends for authorized commissioners 
and panel members. Increasing travel costs, less favorable currency 
exchange rates with Canada and increased costs associated with the 
renegotiation of fishing regimes that will be in progress during fiscal 
year 2008, make it very important that this funding is available to 
support PSC operations.
    This concludes the statement of the U.S. section of the PSC 
submitted for consideration by your committee. We wish to thank the 
committee for the support that it has given us in the past.

                  SUMMARY OF PROGRAM FUNDING FOR THE UNITED STATES-CANADA PACIFIC SALMON TREATY
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal Year     Fiscal Year
                                                                       2006            2008           Section
                                                                   Appropriation  Recommendation     Shortfall
----------------------------------------------------------------------------------------------------------------
Department of Commerce:
    Pacific Salmon Treaty Line Item.............................      $7,000,000  \1\ $8,000,000      $1,000,000
    Pacific Salmon Treaty--Chinook Salmon Agreement Line Item...       1,844,000       1,844,000  ..............
Department of State: International Fisheries Commissions:              3,029,000       3,049,000          20,000
 Pacific Salmon Commission......................................
----------------------------------------------------------------------------------------------------------------
\1\ The recommended fiscal year 2008 amount includes $400,000 provided for the Joint Transboundary River
  Enhancement Program previously funded under the NMFS International Fisheries Commission account.

                                 ______
                                 
        Prepared Statement of the American Astronomical Society
    I appreciate the opportunity to comment on NASA's 2008 science 
budget from my perspective as president of the American Astronomical 
Society (AAS).
    The AAS believes that NASA's Science Mission Directorate (SMD) 
should be part of the American innovation agenda, which seeks to 
bolster funding for the National Science Foundation (NSF), the 
Department of Energy's (DOE) Office of Science, and the National 
Institute for Standards and Technology (NIST). These agencies have been 
identified as vital to America's leadership in innovation, by training 
a highly-skilled workforce and fostering the discovery and development 
of new ideas. NASA science is a partner in these endeavors. 
Specifically, we advocate for increasing NASA SMD's fiscal year 2008 
budget to $5.566 billion, which is 6 percent over the final fiscal year 
2007 amount and a modest increase over the President's fiscal year 2008 
request.
    The AAS is the major organization of professional astronomers in 
the United States. The basic objective of the AAS is to promote the 
advancement of astronomy and closely related branches of science. The 
membership, numbering approximately 7,000, includes physicists, 
mathematicians, geologists, and engineers whose interests lie within 
the broad spectrum of modern astronomy. AAS members advise NASA on 
scientific priorities, participate in NASA missions, and use the data 
from NASA's outstanding scientific discoveries to build a coherent 
picture for the origin and evolution of the Earth, the solar system, 
our galaxy, and the universe as a whole.
    In the recent past, the astronomical community, working together 
with NASA, has produced a remarkable string of successes that have 
changed our basic picture of the universe. Observations with the Hubble 
Space Telescope (HST) of exploding stars whose light has been traveling 
for half the age of the universe, combined with the exquisite map of 
the glow from the big bang itself from the Wilkinson Microwave 
Anisotropy Probe and information from other observatories, shows that 
the universe we live in is not the universe we see. Mysterious dark 
matter makes the ordinary particles clump together to form stars and 
galaxies. Even more mysterious dark energy makes the expansion of the 
universe speed up. Both of these concepts challenge our understanding 
of the nature of matter and energy in the universe and open up broad 
new vistas for future work. An ambitious set of great observatories, 
now including Spitzer in the infrared and Chandra at X-ray wavelengths, 
is hard at work, enriching our understanding of how the universe works.
    Similarly, exploration of the solar system has been a resounding 
success for NASA, with exciting missions to Mars and to Saturn 
revealing a beautiful and intricate history that is interwoven with the 
history of our planet Earth. The discovery of planets around other 
stars has been a great triumph of the past decade, raising hopes for 
seeing planets like our own Earth, and placing our own solar system, 
and life itself, in a new context.
    NASA's key role in these discoveries makes its science program of 
deep interest to AAS members. In the past, NASA has worked with the 
astronomical community to find the most promising paths forward. The 
James Webb Space Telescope (JWST) is a large program that was endorsed 
by the National Academy of Sciences (NAS) Decadal Survey in astronomy. 
When completed in the next decade, it will help expand the frontier of 
knowledge to the deepest reaches of space and time and into the hidden 
places where stars and planets are formed. The astronomical community 
also recommended, and NASA plans to execute, a wide range of other 
programs--some of moderate scope and others that nourish the 
infrastructure for a healthy and vibrant community. This balanced 
approach has proved best--with a range of opportunities carefully 
crafted to get the best science from NASA's science budget.
    Recognizing the current challenging budget climate, in which 
federal non-security, discretionary spending is declining by about 1 
percent, the current NASA budget for science is nonetheless cause for 
concern. The continuing resolution (CR), now Public Law 110-005, 
provided funding for many federal agencies including NASA for fiscal 
year 2007. NASA science has suffered a $78.8 million shortfall from the 
President's fiscal year 2007 request. The President's fiscal year 2008 
budget request represents a 0.9 percent increase in NASA science 
spending over the fiscal year 2007 request; however, with inflation 
currently around 2 percent, the fiscal year 2008 request still 
represents a decline in real dollars available for research in science 
compared to the President's fiscal year 2007 request. A key question is 
what will become the new baseline for NASA science funding, the fiscal 
year 2007 request or the CR. If the CR is adopted as the new baseline, 
this could represent a loss to NASA science in the out-years of $1 
billion or more.
    The AAS therefore recommends that Congress increase the fiscal year 
2008 budget for NASA science by 6 percent over the CR level. This 
modest increase over the President's fiscal year 2008 request will help 
maintain balance within the science portfolio, which is critical to our 
community. It is important to support small missions and research 
grants to individual investigators. Otherwise, many exciting programs 
to explore the solar system, to detect planets around other stars, to 
measure gravitational waves from astronomical events, to explore black 
holes in all their manifestations, and to seek the nature of the dark 
energy may be threatened. In particular, we advocate for restoring 
funding to the Explorer program and protecting the Beyond Einstein 
mission.
    We further advocate that NASA science should be part of the 
American innovation agenda. Maintaining and strengthening American 
innovation in science and technology has broad bipartisan support, both 
in Congress and the administration. Our recommended increase of 6 
percent in NASA science is smaller than the increases proposed for the 
science component of other agencies identified as strategically 
important for innovation. These include an 8.7 percent increase for 
NSF, a 16 percent increase for Department of Energy's Office of 
science, and nearly 21 percent for NIST (all increases over the CR 
levels). For AAS members, the cuts in NASA's support for science 
threaten to offset or overwhelm the increases that have been aimed at 
improving America's innovation through the NSF, DOE, and NIST. A real 
effort to improve science and engineering in the United States should 
treat NASA's science program as part of the solution. NASA's science 
missions inspire new generations of young people to pursue careers in 
science, engineering, and mathematics and train these students and 
young scientists to become the innovators of the future.
    Finally, the AAS applauds the administration and Congress for 
upholding the priorities of the NAS Decadal Survey in astronomy. We are 
pleased that the development of JWST and HST servicing mission are 
priorities in the new budget, but we stress that balance is critical in 
the science portfolio.
    NASA science has been and continues to be a beacon of innovation 
and discovery by inspiring generations of young people, capturing the 
imagination of the public, developing new technologies, and discovering 
profound insights into the nature of our universe.
    The AAS and its members are prepared to work with Congress and with 
NASA to help find the best way forward. We will give you our best 
advice and we will work diligently to make the most of NASA's 
investment in science.
                                 ______
                                 
    Prepared Statement of the National Fish and Wildlife Foundation
    Madam Chairman and members of the subcommittee: I appreciate the 
opportunity to submit testimony regarding the fiscal year 2008 funding 
request for the National Fish and Wildlife Foundation (Foundation). The 
Foundation respectfully requests that the committee fund these efforts 
at the following levels: $4 million through the National Oceanic and 
Atmospheric Administration appropriation.
    This request lies well within the authorized levels and will allow 
the Foundation to better meet the demand for new or expanded strategic 
conservation programs. The appropriations provided by the committee are 
also used by the Foundation to attract additional funding for 
conservation projects through mitigation, settlements, and direct 
gifts.
    These dollars will be focused on mutually agreed upon projects 
across the country. Furthermore, the appropriated $4 million will be 
turned into a minimum of $8 million, according to the Foundation's 
Congressional Charter which requires a minimum of a 1-to-1 match. We 
have been operating on a 3-to-1 match historically, which means that 
the $4 million has the potential to become $16 million or more for on-
the-ground and in-the-water conservation. One other note of special 
interest is that according to the Foundation's charter, all directly 
appropriated funds have to be obligated to grants as they are not 
available to the Foundation for any direct or indirect expenses.
    Since our inception in 1984 through fiscal year 2006, the 
Foundation has supported over 8,865 grants and leveraged over $374 
million in Federal funds for more than $1.2 billion in on-the-ground 
conservation. This has resulted in more than 18.35 million acres of 
restored and managed wildlife habitat; new hope for countless species 
under stress; new models of private land stewardship; and stronger 
education programs in schools and local communities. We recognize that 
without the seed money this committee provides, many of these 
conservation benefits would not be realized.
    The federal dollars appropriated by this committee allow the 
Foundation to assist NOAA in accomplishing its mission. Whether it 
involves coastal-habitat conservation, species management, or 
conservation education, the Foundation strategically invests the 
federal funds entrusted to us in sound projects. This request would 
allow the Foundation to expand its highly successful grant programs to 
better assist NOAA in maximizing protection and restoration of marine 
and coastal resources. Over the 14 years of the NOAA-Foundation 
partnership, more than $47 million in NOAA funds have been leveraged to 
produce over $142 million for on-the-ground and in-the-water 
conservation. From 2002-2006, 788 projects have been awarded, focusing 
on the conservation needs of at-risk species, habitat enhancement, 
coastal restoration, marine debris clean-up, environmental education, 
and community-based stewardship. With our fiscal year 2006 NOAA 
appropriations, we were able to fund 39 projects, representing over 
$1.4 million in Foundation federal funds, leveraging it with $8.4 
million in other federal and non-federal funds to commit $9.8 million 
for coastal and marine conservation.
    The National Fish and Wildlife Foundation continues to be one of, 
if not the most, cost-effective conservation program funded in part by 
the Federal Government. Congress established the Foundation 23 years 
ago, and since that time the Foundation's vision for more healthy and 
abundant populations of fish, wildlife, and plants has flourished 
through the creation of numerous valuable partnerships. The breadth of 
our partnerships is highlighted through our active agreements with 14 
federal agencies, as well as numerous corporations, foundations, and 
individual grantees. Through these unique arrangements, we are able to 
leverage federal funds, bring agencies and industry together, as well 
as produce tangible, measurable results. Our history of collaboration 
has given way to programs and initiatives such as the Chesapeake Bay 
Small Watershed Grants Program, Chesapeake Bay Targeted Watershed 
Grants, North American Waterfowl Management Plan, the Neotropical 
Migratory Bird Conservation Program, and the National Fish Habitat 
Initiative. With the support of the committee in fiscal year 2008, we 
can continue to uphold our mission of enriching fish, wildlife, and the 
habitat on which they depend.
    Working Marine and Coastal Habitats.--The Foundation and NOAA work 
together to identify the highest priority coastal and marine 
conservation projects to sustain, restore, and enhance marine and 
coastal habitats, as well as increase populations of imperiled marine 
species. Funds available through the NOAA/Foundation partnership seek 
to achieve three specific objectives, through our Marine and Coastal 
Life and Habitats Keystone Initiative. These three objectives include: 
increase and sustain productivity of key spawning grounds and unique 
marine habitats by reducing unintended human impacts; increase 
populations of imperiled marine species; and improve and sustain the 
health of the Nation's major estuaries and the Great Lakes by restoring 
and protecting critical coastal habitat, improving water quality in 
tributaries, and enhancing populations of keystone species.
    Conserving Fish, Wildlife, and Plants.--The Foundation also 
administers several programs which are directed to specific species or 
habitats and which are administered to rally private donations and 
contributions from other agencies around these strategic focus areas. 
Examples of such programs include: the Marine Debris Prevention and 
Removal Program, the Coral Reef Conservation Fund, the National Whale 
Conservation Fund, the Chesapeake Bay Small Watershed Grants Program, 
the Pacific Grassroots Salmon Initiative, the Delaware Estuary Grants 
Program, and the Pinellas County Environmental Fund.
  --Coral Reef Conservation Fund.--Responding to an alarming decline in 
        both the quantity and productive quality of the world's coral 
        reef ecosystems, the Foundation partnered with NOAA to 
        establish the Coral Reef Conservation Fund. Through this fund, 
        the Foundation supports local to ecosystem level projects that 
        restore damaged reef systems and prevent further negative 
        impacts through both on-the-water and up-the-watershed 
        projects. By focusing on specific areas of human impact such as 
        anchor damage and sedimentation, we maximize the outcome of our 
        programs. The Foundation has provided funding for over 166 
        projects with $5.7 million in federal and non-federal funds, 
        leveraged with $9.5 million in non-federal matching funds, for 
        a total of $15.2 million for coral conservation in 35 
        countries, including 4 U.S. States and 8 U.S. territories and 
        freely associated States, giving the program a truly global 
        reach
  --Marine Debris Prevention and Removal Program.--In 2006, the 
        Foundation formed a partnership with the NOAA Marine Debris 
        Program to establish a competitive grants program aimed to 
        foster public and private relationships and support research, 
        prevention, and reduction activities related to the issue of 
        marine debris. Through this program, our goals are to build a 
        well informed public that acts as a steward of coastal and 
        marine ecosystems, thereby sustaining the health and 
        productivity of this ecosystem for the benefit of society as a 
        whole. In 2006, the Foundation awarded 18 projects with over 
        $782,000 in federal funds, which was leveraged with over $1 
        million in non-federal matching funds for projects in 9 States 
        and 2 U.S. territories.
    With our NOAA appropriations, the Foundation also leveraged 
resources to fund projects that directly benefit endangered and 
threatened fish and marine species, including such species as North 
Atlantic right whales, Loggerhead turtles, Hawskbill turtles, Pacific 
coho salmon, and Atlantic salmon. We also measure our success in part 
by preventing the listing of species under the Endangered Species Act, 
as well as by stabilizing and hopefully moving others off the list. We 
invested in common sense and innovative cooperative approaches to 
endangered species, building bridges between the government and the 
private sector.
    New Strategic Plan.--During 2006, the Foundation underwent a 
detailed self-evaluation, which resulted in the development of a new 
strategic plan for the organization. The strategic planning process 
revealed that the Foundation maximizes conservation benefits when it 
targets a series of grants towards a specific geographic region, 
habitat type, or conservation challenge. To ensure that future grants 
achieve a sustainable and measurable conservation impact, the 
Foundation is establishing targeted Keystone Initiatives around the 
core conservation investment areas in which the Foundation has 
historically specialized. The Keystone Initiatives represent the new 
core portfolio of the Foundation's grant making with clearly defined 
long-term goals, well-articulated strategies, and defined budgets to 
reach desired outcomes.
    The four initial Keystone Initiatives, launched by the Foundation 
in 2007, include birds; wildlife and landscape scale habitats; 
freshwater fish and habitats; and marine and coastal life and habitats. 
Additional Keystone Initiatives being developed include wildlife and 
agriculture, wildlife and energy development, invasive species, and 
future conservation Leaders. Each grant approved under a Keystone 
Initiative will be designed to provide a measurable outcome that brings 
us one step closer to the final long-term conservation goal of the 
initiative. Where appropriate, the strategies and outcomes of the 
Foundation's Special Grant programs, such as the Great Lakes 
Restoration Fund, Bring Back the Natives, and the Coral Reef 
Conservation Fund, will be designed to directly contribute to the long-
term Keystone Initiative goal. Through our targeted grants, the 
Foundation seeks to achieve measurable success in ``moving the needle'' 
on these critical conservation objectives over the next 5 to 10 year 
period.
    Accountability and Grantsmanship.--During the strategic planning 
process, Foundation staff spent time listening to feedback from our 
agency partners and grantees. Choke points in our grant making process 
were identified, and the Foundation is in the process of revising 
portions of our grant review and contracting process to ensure we 
maximize efficiency while maintaining strict financial and evaluation-
based requirements. The Foundation has also launched a new website that 
is more user-friendly and content rich than the previous version. This 
new interactive tool will allow the Foundation to improve communication 
with our stakeholders and will help streamline our grant making 
process.
    To ensure that only those grants with the greatest likelihood of 
obtaining conservation outcomes directly related to a Keystone 
Initiative are funded, the Foundation has implemented a thorough review 
process. Applicants are required to submit a pre-proposal which allows 
staff to proactively work with applicants to refine and improve their 
application before submitting a full proposal. All full proposals are 
then submitted to a peer review process which involves five external 
reviews representing State agencies, federal agencies, affected 
industry, environmental non-profits, and academics. Grants are also 
reviewed by the Foundation's Keystone Initiative staff, as well as 
evaluation staff, before being recommended to the board of directors 
for approval. In addition, the Foundation provides a 30-day 
notification to the members of Congress for the congressional district 
and State in which a grant will be funded, prior to making a funding 
decision, according to our congressional charter.
    Basic Facts About the Foundation.--The Foundation is governed by a 
25-member board of directors, appointed by the Secretary of Interior 
and in consultation with the Secretary of Commerce. At the direction of 
Congress, the board operates on a nonpartisan basis. Directors do not 
receive any financial compensation for service on the board; in fact, 
most all of our directors make financial contributions to the 
Foundation. It is a diverse board, and includes the director of the 
U.S. Fish and Wildlife Service, the administrator of the National 
Oceanic and Atmospheric Administration, as well as corporate and 
philanthropic leaders with a tenacious commitment to fish and wildlife 
conservation.
    None of our federally appropriated funds are used for lobbying, 
litigation, or the Foundation's administrative expenses. By 
implementing strategic real-world solutions with the private sector, 
while avoiding regulatory or advocacy activities, we serve as a model 
for developing cooperative solutions to environmental issues. We are 
confident that the money you appropriate to the Foundation is making a 
positive difference.

   NATIONAL FISH AND WILDLIFE FOUNDATION'S FEDERAL APPROPRIATIONS FOR
                          FISCAL YEAR 2006 \1\
                        [In millions of dollars]
------------------------------------------------------------------------
                  Agency Funding Source                   Funding Amount
------------------------------------------------------------------------
Natural Resources Conservation Service..................           2.970
Fish and Wildlife Service...............................           7.656
    Washington Salmon...................................           1.971
    Atlantic Salmon.....................................           0.985
Bureau of Land Management...............................           2.955
Forest Service..........................................           2.637
National Oceanic and Atmospheric Administration.........           1.400
    Pinellas County Environmental Fund..................           0.937
------------------------------------------------------------------------
\1\ We are providing the Foundation's appropriations for the last full
  fiscal year, as we are continuing to work with our agencies to
  finalize our fiscal year 2007 funding allocations.

                                 ______
                                 
Prepared Statement of the National Federation of Community Broadcasters
    Thank you for the opportunity to submit testimony to this 
Subcommittee requesting a $30 million appropriation for the Commerce 
Department's Public Telecommunications Facilities Program (PTFP) in 
fiscal year 2007. As the President and CEO of the National Federation 
of Community Broadcasters, I speak on behalf of 250 community radio 
stations and related organizations across the country including many of 
the new Low Power FM stations. NFCB is the sole national organization 
representing this group of stations, which provide independent local 
service in both the smallest communities and largest metropolitan areas 
of this country. Nearly half of NFCB's members are rural stations, and 
half are controlled by people of color.
    In summary, the points we wish to make to this Subcommittee are 
that NFCB:
  --Supports funding for PTFP that will cover the on-going needs of 
        public radio and television stations.
  --Supports funding for conversion of public radio and television to 
        digital broadcasting.
  --Supports funding to help public and community radio stations 
        prepare to provide emergency information during natural or 
        manmade disasters.
  --Supports restoration of administrative funding for the program 
        which was cut in fiscal year 2005.
    Community Radio supports $30 million in funding for the Public 
Telecommunications Facilities Program in fiscal year 2008. Federal 
support distributed through the PTFP is essential to continuing and 
expanding the public broadcasting service throughout the United States. 
It is particularly critical for rural stations and for those stations 
serving low income communities. PTFP funds new stations, expanding the 
reach of public broadcasting to rural areas and to audiences that are 
not served by existing stations. In addition, it replaces obsolete and 
worn out equipment so that the existing public stations can continue to 
broadcast high quality programming. PTFP funding is critical to 
ensuring public radios' readiness to provide life-saving information in 
case of local disasters, as we have seen during the weather emergencies 
the last few years. Finally, with the advent of digital broadcasting, 
PTFP funding is helping with the conversion to this new technology.
    We support $30 million in funding to ensure that both the on-going 
program--currently funded in fiscal year 2007 at $21.8 million--will be 
continued, and that the increase to $30 million will be available to 
help cover the cost of improving the emergency infrastructure of public 
broadcasting stations. This increase in funding is an urgent need in 
order for stations to withstand and broadcast through extreme weather 
or other emergency situations. In addition, increased funding is needed 
to assist the conversion of public radio and television to digital. 
This is particularly important because the FCC has endorsed a standard 
for digital radio broadcasting, the television conversion deadline is 
imminent, and commercial radio stations are converting to digital 
transmission and public radio should not be left behind.
    PTFP funding is unique. It is the only source of funding available 
to help get new stations on the air and to ensure that public 
broadcasting is available everywhere in the United States. At a time 
when local service is being abandoned by commercial radio, PTFP aids 
communities to develop their own local stations which provide local 
information and emergency notifications.
    Funding from PTFP has been essential to keep public radio stations 
on the air by funding replacement of equipment, often after 20 or more 
years of use. The program is administered carefully to be sure that 
stations are acquiring the most appropriate type of equipment. They 
also determine that equipment is being properly maintained and will not 
fund the replacement of equipment before an appropriate length of time. 
PTFP has also helped bring public radio service to rural areas where it 
is not available. Often they fund translators to expand the coverage of 
an existing station and they help with the planning and equipment needs 
of a new station. Recently, many of these new projects have been for 
Native American controlled stations on Indian Reservations or new local 
Low Power FM installations.
    Federal funding is particularly critical to stations serving rural 
and underserved audiences which have limited potential for fundraising 
because of sparse populations, limited number of local businesses, and 
low income levels. Even so, PTFP funding is a matching program so 
federal money is leveraged with a local commitment of funds. This 
program is a strong motivating factor in raising the significant money 
necessary to replace, upgrade and purchase expensive broadcast 
equipment.
    Community Radio stations need to be prepared to provide continuing 
service during emergency situations. As we saw during the hurricanes 
and severe weather the last couple of years, radio is the most 
effective medium of communication about evacuations, weather forecasts, 
traffic, services available, etc. Since everyone has radios and they 
are portable and battery operated, a radio is the first source of this 
critical information. But stations must have emergency power at both 
the studios and the transmitter in order to provide this service.
    Community Radio supports funding for conversion to digital 
broadcasting for public radio and television. While public television's 
digital conversion is mandated by the Federal Communications 
Commission, public radio is converting to digital to provide more 
public service and to keep up with the market. The digital standard for 
radio has been approved and over 300 public radio transmitters have 
been converted. Most exciting to public radio is that stations can 
broadcast two or more high quality signals, even while they continue to 
provide the analog signal. The development of additional digital audio 
channels will potentially more than double the public service that 
public radio can provide, particularly to unserved and underserved 
communities.
    Community Radio supports additional administrative funding for the 
PTFP. While we thank the Senate for continuing funding of PTFP, 
financial support for the skilled dedicated staff who administer these 
funds was cut nearly in half in fiscal year 2005. Restoration of 
administrative funds to the earlier level will assure that the program 
will be carefully and thoroughly administered.
    Over the last few years, the number of administrative staff for the 
Public Telecommunications Facilities Program has been decreased. With 
fewer Program Officers there is less support for applicants or outreach 
about the program and reduced administrative funding hurts the review 
process. NFCB supports the restoration of these funds.
    Thank you for your consideration of our testimony.
                                 ______
                                 
      Prepared Statement of the American Public Power Association
    The American Public Power Association (APPA) is the national 
service organization representing the interests of over 2,000 municipal 
and other state and locally owned utilities in 49 of the 50 States (all 
but Hawaii). Collectively, public power utilities deliver electricity 
to one of every seven electric consumers (approximately 44 million 
people), serving some of the nation's largest cities. However, the vast 
majority of APPA's members serve communities with populations of 10,000 
people or less.
    The Department of Justice's (DOJ) Antitrust Division and the 
Federal Trade Commission (FTC) play critical roles in monitoring and 
enforcing antitrust laws affecting the electric utility industry. With 
the repeal of the Public Utility Holding Company Act (PUHCA) included 
in the Energy Policy Act of 2005, the electric utility industry is 
likely to experience an increase in mergers that could result in 
increased market power in certain regions. This development coupled 
with the volatility and uncertainty continuing to occur in wholesale 
electricity markets makes the oversight provided by DOJ and the FTC 
more critical than ever.
    APPA supports adequate funding for staffing antitrust enforcement 
and oversight at the FTC and DOJ. Specifically, we support the 
Administration's request of $241 million for fiscal year 2008 for the 
FTC. We are heartened that the downward trend in funding for the DOJ's 
Antitrust Division over several years has been reversed, and are 
pleased with the Administration's request of $155 million for fiscal 
year 2008.
    We appreciate the opportunity to submit this statement outlining 
our fiscal year 2008 funding priorities within the Commerce, Justice 
and Science Subcommittee's jurisdiction.
                                 ______
                                 
          Prepared Statement of the Gaviota Coast Conservancy
    Madame Chairwoman and Honorable members of the Subcommittee, I 
appreciate the opportunity to present this testimony in support of an 
appropriation of $1.5 million from NOAA's Coastal and Estuarine Land 
Conservation Program to acquire a 42-acre property at Gaviota Cove in 
California.
    The Gaviota Coast Conservancy is the primary land conservation, 
advocacy group for the Gaviota Coast. Since our incorporation in 1996 
as a non-profit, public benefit organization, we have been working to 
secure permanent protection of the Gaviota Coast's significant 
resources.
    Located in western Santa Barbara County between Coal Oil Point and 
Point Sal, the Gaviota Coast is approximately 100 miles north of Los 
Angeles and lies between the Channel Islands National Marine Sanctuary 
and the Los Padres National Forest. Offering a wide variety of natural, 
recreational and agricultural resources, it is a high priority area for 
conservation and is Southern California's largest remaining stretch of 
pristine coastline. This remarkable 76-mile landscape includes 15 
percent of the Southern California coast, representing about 50 percent 
of its remaining undeveloped coastline. More than 40 sensitive species 
inhabit this area, including the California red-legged frog, western 
snowy plover, southern steelhead trout, southern sea otter, peregrine 
falcon and tidewater goby. More than 525 plant species, representing 
approximately one-half of the plant families found in California, live 
in the Gaviota Coast area. This relatively undisturbed area spans more 
than 30 coastal watersheds, allowing it to serve as a migration 
corridor between inland, mountainous and coastal habitat areas, and 
makes the Gaviota Coast the best opportunity to provide a safe-harbor 
for the threatened biodiversity of Southern California's coastal 
Mediterranean biome. This biome is unique in America.
    The Gaviota Coast also contains some of the most significant 
archaeological sites in California, preserving at least 9,000 years of 
prehistory. The Chumash tribe resided in the area, and sites of several 
Chumash towns, as well as numerous tribal rock art sites, are located 
along the coast. Large cattle ranches and adobes still exist and are 
testimony to the early settlements and agricultural history of the 
region. The Gaviota Coast is a much-loved area for outdoor recreation 
due to its proximity to major metropolitan areas, its scenic vistas, 
rugged beaches, excellent wildlife viewing, and panoramic coastal 
hillsides and mesas. It is home to several state and county parks that 
are popular venues for activities such as hiking, camping, swimming, 
picnicking, hang-gliding, and surfing. A study by the National Park 
Service in 2004 determined that the natural and cultural resources of 
the Gaviota Coast are nationally significant and encouraged efforts to 
conserve them.
    Situated within the Santa Barbara Coast State Seashore, and 
abutting Gaviota State Park on two sides, the 42-acre Gaviota Cove 
property has outstanding natural resource, recreation and scenic 
values. As an in-holding within state park lands, and historically used 
for coastal-dependent industry, this project is an excellent 
opportunity to achieve coastal resource enhancements and public 
recreational access. The property also has several known Chumash 
cultural sites. Gaviota Cove is comprised of a variety of habitat 
types, including grasslands, riparian habitat, willow scrub and coastal 
sage scrub, freshwater aquatic, coastal strand, and marine habitats. 
These habitat types are home to many plant and wildlife species, 
including California thrashers, coyotes, white-crowned sparrows, 
rainbow trout, western fence lizards, snowy egrets, and California 
ground squirrels. Some of the sensitive species that may be found on 
the project site are Gaviota tarplant, southern steelhead, globose dune 
beetle, California red-legged frog, yellow-billed cuckoo, two-striped 
garter snake, San Diego horned lizards, and cactus wren. The western 
portion of the northern parcel and the entirety of the southern parcel 
are designated as environmentally sensitive habitat (ESH) areas under 
state law.
    There are two creeks which run through the property: Alcatraz 
Creek, and Cementerio Creek. Both creeks reach the Pacific Ocean at a 
confluence on the southern part of the property. Documented occurrence 
of southwestern pond turtle, a California species of special concern, 
has occurred on both Alcatraz and Cementerio Creeks. Habitat sustained 
by these blue-line creeks includes riparian woodlands, such as arroyo 
willow and black cottonwoods, eucalyptus stands, oak woodlands, 
chaparral, coastal bluff/sage scrub and native perennial and introduced 
annual grassland communities. The property's southern boundary abuts 
the shoreline's sandy beach. The drainages provide critical corridors 
for wildlife movement and the other habitats provide living space for 
both terrestrial and aquatic species.
    As an addition to Gaviota State Park, this project will expand 
recreational opportunities along this beautiful stretch of Southern 
California coast, and protect the magnificent coastal viewshed of 
Gaviota State Park for visitors on and offshore. The Gaviota Cove 
property offers the unique opportunity to link isolated beach portions 
of the Gaviota State Park, adding more than a quarter-mile of shoreline 
to the park and creating a contiguous corridor of publicly accessible 
beach for 6.5 miles. The Gaviota State Park is an extremely popular 
facility, welcoming 86,000 visitors annually for hiking, soaking in hot 
springs, swimming, diving, surfing, fishing and boating. It currently 
has 41 developed campsites, which are popular and often full to 
capacity. In expanding the state park, this project provides excellent 
opportunities to enhance this public recreation resource, allowing 
State Parks to increase its number of campsites and create and enhance 
new trail linkages.
    Increased demand for housing and other development, coupled with 
the rising value of agricultural land, contribute to the rising 
development pressures on the Gaviota Coast. In fact, the county is 
projected to grow by 50 percent by 2025. The California Wilderness 
Coalition has identified the Gaviota Coast as one of California's ten 
most threatened wild places. Development would threaten the area's 
biodiversity and the agricultural way of life. It would adversely 
compromise the area's scenic vistas, air and water quality, and 
invaluable cultural resources.
    An fiscal year 2008 appropriation of $1.5 million from NOAA's 
Coastal and Estuarine Land Conservation Program (CELCP) is needed to 
acquire and protect this 42-acre property. If added to Gaviota State 
Park, it will increase public beach access, expand recreational 
opportunities, provide much needed visitor facilities, protect scenic 
viewshed, and conserve important wildlife habitat.
    In addition to specifically funding Gaviota Cove, I urge your 
support for a substantial increase in overall funding for the Coastal 
and Estuarine Land Conservation Program in fiscal year 2008 to enable 
the protection of significantly more coastal resources than in previous 
years. While I am pleased that the program has finally been recommended 
in the President's budget for $15 million, this level--while a good 
first step--is inadequate when compared to the needs from across the 
country, and what Congress has historically provided for this program.
    It is well established that coastal land uses can have direct and 
significant adverse impacts on marine resources. In light of the fact 
that most Americans live in coastal counties, resulting in ever-
increasing demands on coastal resources, it is imperative that a high 
priority be placed on coastal, estuarine land conservation if we are to 
properly manage our marine resources.
    Thank you, Madame Chairwoman, for the opportunity to present this 
testimony in support of the Gaviota Cove acquisition and of the CELCP 
program.
                                 ______
                                 
           Prepared Statement of Fight Crime: Invest in Kids
    Ms. Chairman and Members of the Senate Appropriations Subcommittee 
on Commerce, Justice, Science and Related Agencies: Thank your for the 
opportunity to submit this written testimony. My name is Mary Ann 
Viverette. I've been with the Gaithersburg Police Department since 1979 
and Chief since 1986. My public safety career has included service on 
the Executive Committee of the Maryland Chief of Police Association, 
service as a Commissioner with the Commission on Accreditation for Law 
Enforcement Agencies, and I am currently the Immediate Past President 
of the International Association of Chiefs of Police. I am also a 
member of Fight Crime: Invest in Kids, an anti-crime group of more than 
3,000 police chiefs, sheriffs, prosecutors, and victims of violence 
from across the country who have come together to take a hard-nosed 
look at the research about what really works to keep kids from becoming 
criminals.
    As a police chief, I know there is no substitute for tough law 
enforcement. Dangerous criminals must be prosecuted and put behind 
bars. Yet law enforcement leaders like myself know better than anyone 
that we cannot arrest and imprison our way out of the crime problem. 
Fortunately, research--and our experiences--show that targeted 
investments that help kids get a good start in life and that intervene 
effectively to redirect offending juveniles onto a different path can 
prevent crime, and can make our communities safer. The federal Juvenile 
Accountability Block Grant (JABG) and Title II and Title V of the 
Juvenile Justice and Delinquency Prevention Act (JJDPA) provide needed 
support for these evidence-based prevention and intervention 
approaches. The bipartisan Second Chance Act, once enacted, will 
authorize additional support for these approaches. On behalf of my 
fellow law enforcement leaders around the nation, I urge you to 
increase our nation's investments in these proven crime-prevention 
strategies that save lives and taxpayer dollars.
    Programs that connect children to caring adults and provide 
constructive activities, especially during the after-school hours of 3 
p.m. to 6 p.m.--the ``prime time for juvenile crime'' on school days--
are among our most powerful tools for preventing crime. For example, a 
study compared five housing projects without Boys & Girls Clubs to five 
receiving new clubs. At the beginning, drug activity and vandalism were 
the same. But by the time the study ended, the projects without the 
programs had 50 percent more vandalism and scored 37 percent worse on 
drug activity. Similarly, a study of Big Brothers Big Sisters found 
that young people who were randomly assigned to a Big Brother or Big 
Sister mentor were about half as likely to begin illegal drug use and 
nearly one-third less likely to hit someone compared to those who were 
assigned to a waiting list. Despite these proven benefits, more than 14 
million children nationwide still lack adult supervision after school, 
and millions lack a caring, responsible adult mentor in their lives.
    One source of funding for after-school and mentoring programs is 
Title V of the federal Juvenile Justice and Delinquency Prevention Act 
(JJDPA). The Title V Local Delinquency Prevention Grants program is the 
only federal funding source dedicated solely to the prevention of youth 
crime and violence. Almost 1,500 communities have received Title V 
grants since 1994 through a competitive grant process that requires 
states and localities to match at least 50 percent of the grant with 
cash or in-kind contributions.
    For the most dangerous young offenders, especially those who are 
involved in violent gangs, a combination of intensive police 
supervision, expedited sanctions for repeated violence, and expedited 
access to jobs, drug treatment or other services--a carrot-and-stick 
approach--has shown in a number of cities that it can cut homicides 
among violent offenders in high-crime neighborhoods. In Chicago, for 
example, this comprehensive, community-wide approach was tried in a 
group of west side Chicago neighborhoods with a long history of high 
levels of homicide, with another set of dangerous neighborhoods on the 
south side of Chicago serving as the control group. In the carrot-and-
stick approach area there was a 37 percent drop in quarterly homicide 
rates when the project was implemented, while the decline in homicides 
in the other neighborhood during the same period was 18 percent. In a 
number of locations, Juvenile Accountability Block Grant (JABG) or 
JJDPA state formula grant funds have been used to support these 
efforts.
    Effective interventions that incorporate community sanctions have 
also been shown to reliably cut crime. One such program is the 
Functional Family Therapy (FFT) program. FFT works to engage and 
motivate youth and their families to change behaviors that often result 
in criminal activity. In one evaluation from Salt Lake City, families 
with troubled youths were randomly assigned to either a group that 
received FFT or one that did not. The youths who families received FFT 
were half as likely to be re-arrested as the youth whose families did 
not receive the family therapy. By reducing recidivism among juvenile 
offenders, FFT saves the public an average of $32,000 per youth 
treated.
    Similarly, the Multi-Systemic Therapy (MST) program targets kids 
who are serious juvenile offenders by addressing the multiple factors--
in peer, school, neighborhood and family environments--known to be 
related to delinquency. One MST study followed juvenile offenders until 
they were, on average, 29-years-old. Individuals who had not received 
MST were 62 percent more likely to have been arrested for an offense, 
and more than twice as likely to be arrested for a violent offense. It 
is also less expensive than other mental health and juvenile justice 
services like residential treatment and incarceration, saving the 
public $4.27 for every dollar invested.
    The transition of juvenile offenders from confinement to ``life on 
the outside'' presents great risks and opportunities for young people 
and society. Juveniles released from confinement still have their 
likely ``prime crime years'' ahead of them. Perpetrators over age 17 
commit 85 percent of all violent crimes and young adults aged 18 to 21 
account for a greater percentage of crime than any other four-year age 
group. Unsuccessful transitions into the community result in an 
alarmingly high recidivism rate for juvenile offenders of 55-75 
percent. Fortunately, the likelihood that young people will 
successfully transition back into society after confinement improves 
markedly with comprehensive, research-based reentry efforts. 
Comprehensive reentry programs are especially effective among young 
people. With their brain development still in progress, young ex-
offenders are more amenable to effective behavior modification 
interventions, thus saving lives, anguish, and public tax dollars.
    Effective offender reentry efforts include programs like 
Multidimensional Treatment Foster Care (MTFC). Foster care may sound 
like a pass for juveniles who should be paying a more severe price for 
the crime they committed. But for teens who are often used to running 
the streets, and who see a month in custody as just another chance to 
socialize with delinquent friends or learn new criminal behaviors, this 
is a more controlled experience and a tough intervention. MTFC provides 
specially trained foster parents and ongoing supervision by a program 
case manager, as well as frequent contact and coordination of services 
with a youth's parole or probation officer, teachers, work supervisors 
and other involved adults during and after a youth's out of home 
placement. Compared to similar juveniles placed in non-secure group 
facilities, the MTFC approach cuts the average number of repeat arrests 
for seriously delinquent juveniles in half, and six times as many of 
the boys in MTFC as boys in a group home were not arrested again. MTFC 
is also cost-effective: it saves the public an average of over $77,000 
for every juvenile treated.
    The bi-partisan Second Chance Act of 2007 (H.R. 1593/S. 1060) is a 
step toward reducing the high recidivism rate among juvenile and adult 
offenders. The legislation authorizes assistance to states and 
localities to develop and implement strategic plans for comprehensive 
efforts to enable ex-offenders to successfully reenter their 
communities such as: family reunification, job training, education, 
housing, substance abuse and mental health services. The bill would 
also provide for research on reentry, as well as create a national 
resource center to collect and disseminate information on best 
practices in offender reentry. This legislation is moving towards 
enactment in 2007, with funding first authorized for fiscal year 2008.
    JABG and JJDPA Title II state formula grants already support 
research-proven programs like FFT, MST and MTFC. But funding falls far 
short of meeting the need. In 2002, approximately 150,000 juvenile 
offenders were placed out-of-home, and nearly 400,000 others were 
placed on probation. Some juvenile offenders must be placed in secure 
custody to protect public safety, and many others are first-time 
offenders who will not become repeat offenders and therefore are not 
high-risk enough to justify the expense and intrusion of the 
aforementioned programs. But even if only half of those on probation 
and half of those placed out of home are eligible for these effective 
intervention programs, the number of young offenders who could benefit 
from evidenced-based approaches would still amount to 7 times the 
35,000 total currently being served by MST, FFT, and MTFC. In other 
words, these programs will have to expand 7 times their current 
capacity nationwide before they start running out of youth who could 
and should be receiving their services.
    Unfortunately, the Administration's fiscal year 2008 budget 
proposes to eliminate all of the JJDPA funding sources and create a 
single, new ``Child Safety and Juvenile Justice'' block grant. This 
block grant would be funded at a level that is 25 percent lower than 
the total fiscal year 2007 funding for the programs eliminated. We 
encourage Congress to demonstrate its commitment to crime prevention by 
rejecting proposed cuts and block-granting, and by increasing funding 
for federal juvenile justice and delinquency prevention programs. We 
urge you to restore funding for Title II State Formula Grants to $89 
million, Title V funding to $95 million, and JABG funding to $250 
million--levels appropriated by Congress in fiscal year 2002--and 
ensure that the new Second Chance Act of 2007 is fully funded.
    If we do not invest in research-proven crime-prevention programs 
for America's most vulnerable kids, many of them will grow up to become 
America's most wanted adults. By failing to adequately invest in proven 
crime-prevention strategies, Congress is not only failing to facilitate 
a better future for millions of kids but is also permitting the 
cultivation of criminals--jeopardizing the safety of all Americans for 
years to come.
    Thank you for this opportunity to present our views on how your 
Subcommittee can help to reduce crime and make us all safer.
                                 ______
                                 
      Prepared Statement of the West Creek Preservation Committee
    Madam Chairwoman and Honorable members of the Subcommittee, I 
appreciate and am honored by the opportunity to provide this testimony 
in support of an appropriation of $1,100,000 from NOAA's Coastal and 
Estuarine Land Conservation Program to protect the 10-acre West Creek 
Confluence property in the city of Independence, Ohio.
    In addition, I would like to urge your support for a substantial 
increase in overall funding for the Coastal and Estuarine Land 
Conservation Program in fiscal year 2008. The coastal resources of this 
nation, including Ohio's, are under intense and increasing development 
pressure. It is of the utmost importance that we balance future 
development with greater protection of our coastal resources and 
natural heritage. For instance, in Ohio alone approximately $10 billion 
is generated annually from Lake Erie tourism and recreation-related 
activities, which are dependent upon a healthy and aesthetically 
pleasing coastal area.
    Ohio is not alone in regard to its need for greater coastal 
resource protection. Across this great nation coastal areas are among 
the most densely populated and heavily utilized. We are pleased that 
the program has been recommended in the President's budget for $15 
million. However, when compared to the needs from across the country 
and to what Congress has historically provided for this program, we 
believe that the protection and future wellbeing of our coastlines and 
coastal watersheds requires a substantially greater investment.
    To be specific, the protection and future wellbeing of Ohio's 
coastal resources and coastal watersheds are why I have traveled to be 
before you today. I am the Watershed Coordinator for the West Creek 
Preservation Committee, a citizen-led nonprofit organization that works 
within the Greater Cleveland area of the Cuyahoga River and Lake Erie 
watersheds. Our mission is to conserve, protect and restore the 
environmental, recreational and cultural resources of this area. Our 
thousands of supporters and members are comprised of a diverse mixture 
ranging from your average citizens, to business leaders, to elected 
officials, all with the common goal of protecting environmental 
quality, furthering outdoor urban recreational opportunities and 
quality of life, and increasing economic prosperity.
    In the ten years that the West Creek Preservation Committee has 
been in existence we have protected approximately 500 acres of urban 
and suburban greenspace including the creation of Cleveland's newest 
Metropark, we have created and restored acres of urban wetlands, we are 
developing a recreational trail system and greenway that will span 
multiple communities and be a part of and connect with the Ohio & Erie 
Canalway National Scenic Byway, and we are undertaking one of the most 
ambitious and important stream restoration projects in the Greater 
Cleveland area.
    We are proud to be working with the City of Independence, Ohio, and 
numerous other project partners, including The Trust for Public Land, 
the Northeast Ohio Regional Sewer District and Cleveland Metroparks, on 
what we consider to be one of our most critical projects to date, the 
West Creek Confluence Project. Located within Cuyahoga County in the 
City of Independence, and within the Cuyahoga River Area of Concern, 
the West Creek Confluence Project involves the acquisition, and future 
complete restoration, of ten acres of land at the confluence of two 
extremely important waterbodies, West Creek and the Cuyahoga River.
    The property contains approximately 850 feet of West Creek main 
stem and includes its confluence with the Cuyahoga River. The property 
is positioned at the northern end of the Cuyahoga Valley National Park, 
is adjacent to the Ohio & Erie Canalway National Scenic Byway, and will 
provide an access point to the Cuyahoga Valley Scenic Railroad and to 
the Ohio & Erie Canal Towpath Trail.
    Several decades ago the property was developed with what is now an 
empty warehouse, which severely impacted West Creek and has contributed 
to extensive flooding, degraded aquatic and riparian habitat, and 
enormous influxes of nonpoint source pollution to the Cuyahoga River 
and Lake Erie Basin.
    Once permanently protected the Confluence Property will be fully 
restored and the empty warehouse and parking lot removed. Proper 
hydrology will be restored to the waterway by re-meandering it through 
the property and re-connecting it with its floodplain. Aquatic and 
riparian habitat will be restored to the stream and an expansive array 
of floodplain wetlands and vernal pools will be created to increase 
ecological habitat and diversity for everything from waterfowl to 
amphibians, to store and retain stormwater during flooding events, and 
to filter and reduce sediment influxes and other nonpoint source 
pollution, one of the greatest contributors to water quality problems 
within Lake Erie.
    Perhaps most importantly, the West Creek Confluence Project will 
herald in a new era of sustainable land use for the Cuyahoga River 
floodplain and its development away from previously poor and 
incompatible land uses. This project will not only improve the 
environment and Lake Erie Basin water quality, it will also create a 
dynamic recreational and educational focal point along the Ohio & Erie 
Canalway Scenic Byway that will attract large numbers of citizens, 
tourists and new business opportunities.
    When completed, as visitors veer west from the Ohio & Erie Canal 
Towpath Trail onto the West Creek Greenway Trail System, they will see 
a meandering, willow-lined West Creek, they will see a broad and 
vibrant floodplain, and they will see numerous floodplain wetlands and 
vernal pools and the animals that inhabit them. The West Creek 
Confluence Project will become a gateway to the endless possibilities 
that exist within the realm of urban coastal conservation and 
stewardship.
    Realizing the importance and value of this project, the State of 
Ohio (through the Clean Ohio Conservation Fund), the Northeast Ohio 
Regional Sewer District (through the Water Resources Restoration 
Sponsorship Program) and the City of Independence are all making 
substantial monetary investments in the West Creek Confluence Project. 
The appropriation of $1,100,000 from NOAA's Coastal and Estuarine Land 
Conservation Program will leverage and be matched with the committed 
funding from the State of Ohio, Northeast Ohio Regional Sewer District 
and City of Independence to bring the protection of this important 
property through to fruition.
    Millions of Ohioans depend upon Lake Erie for clean drinking water, 
recreational enjoyment and economic prosperity. It is the eleventh 
largest freshwater lake in the world and, of the five Great Lakes 
basins, it is the most densely populated and most affected by both 
urbanization and agriculture. Lake Erie supports one of the world's 
most significant commercial freshwater fisheries and the largest sport 
fishery among the five Great Lakes. Lake Erie alone produces more fish 
for human consumption than the other four Great Lakes combined!
    Ohio's North Coast has seen a significant increase in recreation 
and tourism related revenue over the past decade, which is directly 
attributable to the environmental and aesthetic health and wellbeing of 
Lake Erie. Over 7 million people recreate at Ohio's portion of the Lake 
Erie Basin annually resulting in the sustenance of a quarter of a 
million jobs and netting $5.8 billion in yearly wages. An additional 
approximately $10 billion per year is generated from Lake Erie tourism 
and recreation-related activities.
    Lake Erie is key to Northern Ohio's future economic prosperity! The 
West Creek Confluence Project represents a key step in sustaining and 
improving Lake Erie watershed water quality and environmental health!
    In fiscal year 2008, $1.1 million is needed from NOAA's Coastal and 
Estuarine Land Conservation Program to complete the protection of the 
West Creek Confluence Property. Substantial State of Ohio and local 
investment has been secured to match this Coastal and Estuarine Land 
Conservation Program funding request. However, due to time limitations 
associated with some of the State and local matching funds it is 
critical that this Coastal and Estuarine Land Conservation Project be 
funded in fiscal year 2008.
    On behalf of the West Creek Preservation Committee, our members, 
supporters and citizens of Greater Cleveland and Northeast Ohio, I 
thank you, Madam Chairwoman and Honorable members of the Subcommittee, 
for the opportunity to provide this testimony.
                                 ______
                                 
  Prepared Statement of the American Institute of Biological Sciences
    The American Institute of Biological Sciences (AIBS) encourages 
Congress to appropriate at least the President's fiscal year 2008 
request of $6.43 billion for the National Science Foundation (NSF). 
Providing at least $20 million more than the request would enable NSF 
to increase funding for the Biological Sciences Directorate (BIO) by 
roughly 7 percent, an increase over the requested 4.1 percent and just 
below the agency-wide average increase for the various research 
directorates.
    AIBS is a nonprofit scientific association dedicated to advancing 
biological research and education for the welfare of society. Founded 
in 1947 as a part of the National Academy of Sciences, AIBS became an 
independent, member-governed organization in the 1950s. AIBS is 
sustained by a robust membership of some 5,000 biologists and nearly 
200 professional societies and scientific organizations; the combined 
individual membership of the latter exceeds 250,000. AIBS advances its 
mission through coalition activities in research, education, and public 
policy; publishing the peer-reviewed journal BioScience and the 
education website ActionBioscience.org; providing scientific peer 
review and advisory services to government agencies and other clients; 
convening meetings; and managing scientific programs.
    Invigorating our nation's innovation enterprise, improving science 
education, and addressing energy, security, and environmental problems 
are bipartisan national priorities. NSF is the primary federal research 
agency with the capacity to support the breadth of scientific research 
programs that have the potential to drive discovery to meet these 
priorities. Moreover, NSF-sponsored biological and environmental 
sciences research will contribute to the development of sustainable and 
cost-effective solutions for these challenges.
    NSF's BIO is vital to our nation's continued leadership in the 
biological sciences, the fields of science dedicated to understanding 
how organisms and ecological systems function. Research disciplines 
heavily dependent upon the directorate include botany, ecology, 
microbiology, zoology, basic molecular and cellular biology, 
systematics and taxonomy. Equally important, NSF provides essential 
support for our nation's biological research infrastructure, such as 
field stations and natural science collections (e.g. university-based 
natural history museums), and education and training programs for 
undergraduate, graduate and post-doctoral students.
    According to NSF data, BIO provides 68 percent of federal grant 
support for fundamental biological research conducted at our nation's 
universities and other nonprofit research centers.
    The Administration's fiscal year 2008 budget request would provide 
$5.131 billion to support disciplinary research programs within the 
Research and Related Activities (R&RA) account. This funding level 
would provide an average 7.7 percent increase for the various programs 
within the R&RA account, and a 4.1 percent increase for the biological 
sciences.
    Members of the biological sciences community appreciate the 
proposed increase. However, there is growing concern that BIO funding 
is not keeping pace with the need and demand for biological sciences 
research. When adjusted for inflation, the requested fiscal year 2008 
budget for BIO places the program only slightly above the 2001 funding 
level and near the 2003 funding level. Scientists dependent upon BIO 
grants for research support are feeling the pressure. Over the past 
four years, the research grant funding rate for BIO has been lower than 
the NSF-wide funding rate. Yet the number and scope of problems 
requiring biological information continues to increase. In 2006, the 
research grant funding rate was only 14 percent compared with an 
agency-wide rate of 21 percent.
    Under the requested budget, BIO would receive $633 million in 
fiscal year 2008 to support its six core programs. These programs and 
their proposed funding levels are: Molecular and Cellular Biosciences 
$116.37 million; Integrative Organismal Systems $105.49 million; 
Environmental Biology $114.66 million; Biological Infrastructure $96.1 
million; Emerging Frontiers (a cross-discipline, ``virtual'' 
directorate) $99.16 million; and Plant Genome Research $101.2 million.
    The fiscal year 2008 budget request includes important funding for 
the National Ecological Observatory Network (NEON), the first national 
ecological measurement and observation system designed to answer 
regional- to continental-scale scientific questions. NEON is an 
innovative facility that is designed to transform the way science and 
education are conducted by enabling integration of data from natural- 
to human-dominated systems and from genomes to the biosphere. A total 
of $24 million has been requested for NEON in fiscal year 2008. Roughly 
$16 million would be funded from BIO and $8 million would be funded 
from the Major Research Equipment and Facilities Construction (MREFC) 
account.
    Research support is only one of NSF's important missions. NSF is a 
vital component of our nation's formal and informal science education 
system. Whether through programs such as Research Experiences for 
Undergraduates, Integrated Graduate Education and Research 
Traineeships, or other fellowships for graduate and post-doctoral 
researchers, NSF provides the resources required to recruit, educate 
and train our next generation of scientists.
    The informal science education programs supported by the Education 
and Human Resources Directorate could benefit from increased funding. 
Economic growth demands a scientifically aware and technically skilled 
workforce--one in which employees have the scientific awareness 
adequate to generate the next great idea. Moreover, we live at a time 
when the citizenry is increasingly called upon to make informed 
decisions. Informal science education programs, whether through a 
natural history museum, science center or other venue, reach large 
audiences and provide a valuable mechanism for reaching the general 
public.
    Thank you for your thoughtful consideration of this request and for 
your prior support of the National Science Foundation. If you have any 
questions or require additional information, please contact me at 202-
628-1500.
                                 ______
                                 
      Prepared Statement of the American Museum of Natural History
              about the american museum of natural history
    The American Museum of Natural History (AMNH) is one of the 
nation's preeminent institutions for scientific research and public 
education. Since its founding in 1869, the Museum has pursued its joint 
mission of science and public education. It is renowned for its 
exhibitions and collections of more than 32 million natural specimens 
and cultural artifacts. With approximately 4 million annual on-site 
visitors--approximately half of them children--it is one of the 
largest, fastest growing, and most diverse museums in the country. 
Museum scientists conduct groundbreaking research in fields ranging 
from all branches of zoology, comparative genomics, and informatics to 
Earth science, biodiversity conservation, and astrophysics. Their work 
forms the basis for all the Museum's activities that seek to explain 
complex issues and help people to understand the events and processes 
that created and continue to shape the Earth, life and civilization on 
this planet, and the universe beyond.
                 the american museum--nasa partnership
    NASA and the AMNH have been engaged in a multi-year partnership 
founded on a joint commitment to cutting-edge research and the 
integration of that research into unique educational tools and 
resources. The AMNH has worked with the Agency to develop innovative 
technologies and resources that provide an unparalleled platform for 
interpreting, displaying, and distributing NASA content to audiences 
nationwide.
  --The Museum has built a set of singular national resources that 
        bring cutting-edge science and integrated NASA content to total 
        audiences of more than 15 million in New York City, across the 
        country, and around the world. In the New York area alone, the 
        Museum reaches nearly four million annual visitors, including 
        more than 450,000 children in school groups and more than 5,000 
        teachers, with millions visiting online.
  --We have launched a successful program to disseminate project 
        resources to informal learning venues nationally and 
        internationally, with Science Bulletins already on view in 39 
        locations and Space Shows at 32, with more being added.
  --We have created Science Bulletins--technologically innovative, 
        immersive multimedia science encounters, presenting space, 
        Earth, and life science news and discoveries in visually 
        stunning feature documentaries, data visualizations, and weekly 
        updates.
  --The Museum has made numerous technological breakthroughs--it has 
        established leadership in science visualization and high 
        resolution renderings of massive data sets; it has converted 
        its Space Shows to digital format, making the AMNH the only 
        full planetarium dome content provider that crosses all major 
        platforms; it has pioneered a unique online distribution 
        network that each week streams new science content in HD MPEG2 
        encodes to partners across North America and most recently, has 
        simplified the technical requirements of the network, including 
        new server and/or lower bandwidth for downloading, so that 
        content is more accessible to more venues.
  --AMNH routinely hosts major events celebrating NASA's mission 
        highlights and milestones. Recent events have included live, 
        large-scale events of broadcasts of the New Horizons launch, 
        Stardust sample return, and Mars Reconnaissance Orbiter arrival 
        at Mars.
  --The Museum's educational mission is fueled by and reflects cutting-
        edge science, including the work of our scientists in 
        collaboration with NASA centers and researchers.
    Building on this foundation, the Museum seeks in fiscal year 2008 
to advance the AMNH-NASA collaboration--with a particular focus on 
scaling up to reach even larger audiences--with a program for 
communicating current science content, and content about NASA science 
and missions in particular, to diverse national audiences. The Museum's 
activities will include the development of current NASA science 
education resources, such as Science Bulletins, and continuing to scale 
up their national distribution for presentation in public spaces and 
for classroom use.
    Science Bulletins (SB) is a nationally distributed, multimedia 
science exhibition program targeted to informal learning settings. It 
presents cutting-edge research and discoveries in visually compelling 
feature documentaries and updates in flexible, large-screen, high-
definition video and interactive kiosk versions, as well as in a free 
online version adapted for classroom use. Our SB program for the 
following year includes expanding dissemination significantly, 
developing new visualization methods for use in the development and 
distribution of SB, and reaching out in diverse ways to the formal 
education sector to maximize access to the Science Bulletins at the K-
12 level.
    Museum activities for the next year also include R&D on new 
techniques for visualizing massive space and Earth science data sets, 
creating visualization tools for presenting NASA missions and other 
dynamic science stories, and for advancing innovative solutions to 
technical challenges in presenting digital planetarium shows. AMNH will 
conduct extensive internal and external evaluation of this program's 
activities.
    Recognizing its potential to support NASA in its goals to pioneer 
the future in space exploration, scientific discovery, and aeronautics 
research; to develop a balanced overall program of science, 
exploration, and aeronautics; and to establish new and innovative 
programs to enhance understanding of our Earth, other planets, 
asteroids, and comets in our solar system, as well as the search for 
life around other stars, the Museum looks forward to advancing its 
successful multi-year collaboration with NASA and to contributing its 
unique science, education, and technological capacity to helping the 
Agency to meet these goals.
                                 ______
                                 
      Prepared Statement of the American Museum of Natural History
              about the american museum of natural history
    The American Museum of Natural History (AMNH) is one of the 
nation's preeminent institutions for scientific research and public 
education. Since its founding in 1869, the Museum has pursued its 
mission to ``discover, interpret, and disseminate--through scientific 
research and education--knowledge about human cultures, the natural 
world, and the universe.'' It is renowned for its exhibitions and 
collections of more than 32 million natural specimens and cultural 
artifacts. With nearly four million annual visitors, its audience is 
one of the largest, fastest growing, and most diverse of any museum in 
the country. Museum scientists conduct groundbreaking research in 
fields ranging from zoology, comparative genomics, and informatics to 
Earth, space, and environmental sciences and biodiversity conservation. 
Their work forms the basis for all the Museum's activities that seek to 
explain complex issues and help people to understand the events and 
processes that created and continue to shape the Earth, life and 
civilization on this planet, and the universe beyond.
    The Museum's Center for Biodiversity and Conservation, founded in 
1993, is dedicated to enhancing the use of scientific data to mitigate 
threats to global biodiversity, and to integrating this information 
into the conservation process and disseminating it widely. It conducts 
conservation-related field projects around the world, trains 
scientists, organizes scientific symposia, presents public programs, 
and produces publications geared toward scientists, policy makers, and 
the lay public. Each spring, the CBC hosts symposia that focus on 
conservation issues. The 2006 symposium, Conserving Birds in Human-
Dominated Landscapes, focused on unique challenges to and key 
opportunities for invigorating bird diversity in the areas most heavily 
impacted by human activities, and the 2007 symposium, Small Matters: 
Microbes and Their Role in Conservation, will bring together a diverse 
group of microbiologists and conservation biologists to explore broad 
questions of the planet's microbial diversity and how conservation 
practices take microbial life into account.
    The Museum's renovated Hall of Ocean Life, reopened in spring 2003, 
is a major focal point for public education on marine science issues. 
Drawing on the Museum's world-renowned expertise in Ichthyology as well 
as other areas of Vertebrate as well as Invertebrate Zoology, the Hall 
is pivotal in educating visitors about the oceans' key role in 
sustaining life on our planet. The renovated Hall of Ocean Life, 
together with the new Halls of Biodiversity, Planet Earth, and the 
Universe and the rebuilt Hayden Planetarium (part of the new Rose 
Center for Earth and Space) provide visitors with a seamless 
educational journey from the universe's beginnings to the formation and 
processes of Earth to the extraordinary diversity of life on our 
planet.
                     common goals of noaa and amnh
    The National Oceanic and Atmospheric Administration (NOAA) is 
committed to understanding and predicting changes in the Earth's 
environment and to conserving and managing coastal and marine resources 
to meet the nation's needs. NOAA's Education Plan outlines a broad 
vision for reaching various audiences to build awareness and knowledge 
of issues related to the world's atmosphere, climate, oceans, and 
coastal ecosystems. Addressing the needs of teachers, students, and 
policy makers as well as the general public, the agency's goals include 
enhancing environmental literacy and knowledge, application of NOAA 
science, and development of a capable and diverse workforce for 
environmental science.
    The American Museum of Natural History shares NOAA's commitment to 
these environmental goals and to the scientific research and public 
education that support them. Since its founding in 1869, the American 
Museum has pursued its mission of scientific investigation and public 
education. Its exhibitions and collections serve as a field guide to 
the entire planet and present a panorama of the world's cultures. 
Museum collections of some 32 million specimens and cultural artifacts 
provide an irreplaceable record of life. More than 200 Museum 
scientists conduct groundbreaking research in fields as diverse as 
systematic and conservation biology, astrophysics, and Earth and 
biodiversity sciences. The work of scientific staff fuels exhibitions 
and educational programming that reach annually an on-site audience of 
nearly four million visitors--nearly half of them children.
                       marine sciences initiative
    In fiscal year 2004, as a result of Congressional leadership, the 
Museum entered into a partnership with NOAA that launched a multi-year 
marine science and education initiative. Support for this initiative, 
which encompasses a broad range of education and research activities 
closely aligned with NOAA goals and purposes, was continued in fiscal 
year 2005 (and recommended in the fiscal year 2007 report), and further 
leveraged by Museum scientists who successfully secured competitive 
NOAA funding. Building upon this strong foundation, and in concert with 
the strategic priorities of NOAA and the Museum, we seek $1 million in 
fiscal year 2008 to join with NOAA in aquatic research and education 
activities that promote environmental literacy. Over a one year period, 
activities will include: ecosystem-based research, training, and 
research tool development concerning oceans and aquatic environments; 
professional development for teachers; special programs on New York 
waterways for New York City schoolchildren; and public education 
programs--including some built around a special water exhibition--that 
will increase understanding of the importance of healthy oceans and 
atmosphere.
    Recognizing its potential to support NOAA in its goals to 
understand and predict changes in the Earth's environment; to conserve 
and manage coastal and marine resources; and to protect, restore, and 
manage the use of coastal and ocean resources to meet our Nation's 
economic, social, and environmental needs, the Museum looks forward to 
advancing a partnership with the agency in an education, outreach, and 
research initiative to promote public understanding and stewardship of 
marine environments.
                                 ______
                                 
   Prepared Statement of the University Corporation for Atmospheric 
                                Research
    On behalf of the University Corporation for Atmospheric Research 
(UCAR) and the university community involved in weather and climate 
research and related education, training and support activities, I 
submit this written testimony for the record of the Senate Committee on 
Appropriations, Subcommittee on Commerce, Justice and Science. UCAR is 
a 70-university member consortium that manages and operates the 
National Center for Atmospheric Research (NCAR) and additional programs 
that support and extend the country's scientific research and education 
capabilities. UCAR is supported by the National Science Foundation 
(NSF) and other federal agencies including the National Aeronautics and 
Space Administration (NASA), and the National Oceanic and Atmospheric 
Administration (NOAA).

    Innovation research is about chemistry and physics, but it's also 
about earth science. Understanding the earth is a basic necessity, 
because we need to understand our planet and its environments in order 
to make sound policy decisions. And if we don't understand the earth, 
we can't save it.----Barbara Mikulski, Chair, Appropriations Commerce, 
Justice, Science Subcommittee

    The American Competitiveness Initiative (ACI) is proposed to double 
the physical sciences research budget by 2016, thereby strengthening 
this nation's economic competitiveness. In this most critical moment 
for the health of our planet and therefore the future of life as we 
know it, the geosciences contribute knowledge that is absolutely 
necessary to understanding climate, weather, the dynamics of water 
resources, solar effects on Earth, space weather, the interactions of 
Earth's systems, energy resources, geologic hazards, and all aspects of 
the global oceans. The economic effects are very substantial, with 
estimates of the component of the U.S. economy exposed to risks 
associated with weather and climate variability reaching $3 trillion 
annually.
    The strength of the country's R&D investment is a result of 
multiple agencies playing numerous, complementary and interlocking 
roles. Through NSF, NASA and NOAA funding of the geosciences, critical 
information is provided for economic planning and to produce a better 
equipped work force to deal with environmental challenges. The 
atmospheric sciences community strongly supports the nation's 
innovation agenda--an investment that will pay great dividends for this 
country if it is funded over the next ten years. We urge the Committee 
to do everything possible to include the geosciences within NSF, as 
well as NASA and NOAA science programs, in this initiative.
National Science Foundation (NSF)
    NSF plays a unique role among all federal agencies in strengthening 
the ability of the country to: create new ideas; develop new 
technologies; create a diverse, knowledgeable workforce; and set new 
standards that challenge any boundaries of invention and intellect. 
These are all key components of our capacity to compete globally in the 
21st Century and are fundamental drivers of wealth producing growth and 
job creation. I urge the Committee to support the President's overall 
fiscal year 2008 request of $6.4 billion for the National Science 
Foundation and, within NSF, the request of $5.1 billion for Research 
and Related Activities (R&RA), the heart of NSF's scientific 
enterprise. In addition, I urge the Committee to support the 
Administration's goal of doubling the research budget of NSF over the 
course of a decade, realizing the promise of the National Science 
Foundation Authorization Act of 2002.
    Geosciences Directorate (GEO).--GEO is the principal source of 
federal funding for university based, basic research in the 
geosciences, providing 61 percent of the total federal support in these 
areas. As stated directly in the fiscal year 2008 budget request, ``GEO 
directly contributes to innovation and competitiveness through its 
broad portfolio of investments in fundamental research, facilities, and 
instrumentation that enable discovery, innovation, and integrated 
education and research activities that increase the effectiveness of 
the science and engineering workforce.'' I urge the Committee to 
support the President's fiscal year 2008 request of $792.0 million for 
the Geosciences Directorate and, within GEO, to provide the President's 
request of $240.8 million for the Atmospheric Sciences Division which 
provides resources for the atmospheric sciences community that are 
critical to the physical safety of our citizens, our economic health, 
and global issues of national security such as severe weather hazards, 
climate change, the security of our communications infrastructure, and 
the environmental health of the planet.
    Education and Human Resources (EHR) Directorate.--Key to the 
success of the innovation agenda and to the future of this country, is 
the improvement of math and science education. However, EHR funding has 
declined steadily for the last several years, particularly in the K-12 
and undergraduate areas. We believe those reductions should be reversed 
so that a strong NSF presence in the K-12 and undergraduate areas can 
be maintained. The strengthening of science education, so critical to 
the nation's future, must be intimately connected with the best 
scientific practices and results being produced via the NSF scientific 
directorates. We appreciate the recognition in the request of the value 
of digital libraries to major communities of learners. Within the 
Division of Undergraduate Education (DUE), the National STEM Education 
Digital Library (NSDL) receives a modest increase of $500,000. The 
value of this program continues to rise as its capacity to bring first-
rate education tools into the classroom is broadened and enhanced. I 
urge the Committee to provide as healthy an increase as possible, above 
the request of $750.6 million, for the Education and Human Resources 
Directorate so that it may play its rightful, critical role in 
achieving the country's ACI goals.
National Aeronautics and Space Administration (NASA)
    NASA's Science Mission Directorate (SMD) plays a unique and central 
role in our nation's ability to attract students into science and 
engineering fields, and to understand the universe, our own planet's 
environmental complexities and its relationship to the Sun, and major 
factors contributing to climate change. Despite this essential role, 
NASA's fiscal year 2008 federal budget request would significantly 
decrease the science portfolio, defer or eliminate many of the nation's 
most successful and promising missions, and fund only a relatively 
small number of scientific missions (albeit promising ones) in the next 
five to ten years. While the manned program is important, it cannot 
come at the expense of this critical investment. Within SMD, NASA also 
plays a unique and central role in the study of the complexities of the 
Earth system and the equally complex relationship of the Sun to Earth. 
NASA's continued funding for Landsat Data Continuity Mission (LDCM), 
Glory, NPOESS Preparatory Project (NPP), and the Global Precipitation 
Measurement (GPM) mission to maintain current schedules is strongly 
endorsed. However, given the recent release of the National Research 
Council's Decadal Survey on Earth Science, NASA should increase its 
funding levels for earth sciences consistent with the report's 
recommendations to ensure that future critical missions are supported.
    Moreover, NASA's investment in Earth Science Research and Analysis 
(R&A) and the missions and tools associated with this research makes 
possible the study of Earth from space providing data that simply are 
not available from any other sources. These observations, used in 
research and in the construction of computer models to predict weather, 
climate, and natural hazards, provide a critical basis from which our 
understanding of our planet evolves and on which informed policy 
decisions, both long term and emergency response, can be made. Given 
the tremendous importance of this underlying activity, I urge the 
Committee to restore Research and Analysis (R&A) programs to funding 
levels at least commensurate with fiscal year 2006 levels.
    In addition to investments in Earth-Sun System, NASA must preserve 
the essential PI-led programs that serve as a primary conduit through 
which the nation's best scientists can engage NASA in cutting-edge 
problems. NASA should support the Explorer, Discovery, and New Frontier 
programs and fully commit to missions unless there are technical or 
cost related issues. When NASA promotes premature termination of those 
missions for non-technical or cost reasons, it is in danger of sending 
the message to the community that it is an unreliable partner and that 
this is not a field that future scientists and engineers should pursue. 
Moreover, balanced, highly skilled teams of talent are lost, as are 
discoveries on the immediate horizon. NASA also sends a troubling 
message to graduate students and young investigators by delaying new 
opportunities in these programs. The long delay in Explorer 
opportunities from a once annual opportunity runs the risk of depleting 
the nation's pipeline of scientists and program managers capable of 
leading the next generation of earth and space missions.
    While the exploration initiative and International Space Station 
are of great human interest and of scientific value, we are far from 
unlocking all the mysteries of our own planet. NASA programs that are 
in progress and others that are yet to be implemented will enable us to 
protect space vehicles, astronauts, and satellites from the devastating 
radiation of solar storms; mitigate some of the property damage and 
prevent some of the deaths caused by severe weather; and help us to 
mitigate, understand, and cope with the inevitable effects of natural 
and human-induced climate change. These programs are critical to the 
health of our economy, to the health of the Earth, and to our national 
security. As the Administration's new vision for U.S. space exploration 
unfolds, I urge the Committee to protect the vibrant NASA science 
accounts and missions, current and planned, that make possible the 
study of our own planet and the environment that sustains life on 
Earth.
National Oceanic and Atmospheric Administration (NOAA)
    NOAA's contributions to the nation's safety, economy and 
environment more than justify increased investment in its research and 
education programs, its personnel and related scientific support 
facilities. One of NOAA's most important contributions is its support 
for the weather enterprise--a partnership between government, academic 
and private sector organizations. For example, NOAA maintains a world-
class satellite and surface-based observational system without which 
weather research and operational forecasts simply could not function. 
NOAA also makes its own key contributions to both research and to 
developing and maintaining operational systems. Without the R&D and 
operations behind the accurate forecasts and warnings that moved tens 
of thousands of people out of the path of Hurricane Katrina, the number 
of deaths caused directly by the storm would have been catastrophic. 
This is just one example of the manner in which NOAA provides a 
critical link that often means the difference between life and death, 
between research results, research applications, technology 
development, and operations.
    We strongly support an appropriation of $4.5 billion for NOAA in 
fiscal year 2008--a level recommended by the Senate for the past two 
fiscal years and endorsed by the House Oceans Caucus and the Friends of 
NOAA Coalition. The fiscal year 2008 request is $3.8 billion, a 
decrease of more than $96.0 million from the fiscal year 2006 enacted 
level. We believe that under-funding NOAA is a false economy that will 
degrade critical weather and climate services all too often taken for 
granted. For NOAA to address all areas of concern and priority that 
have been identified by Congress and that are listed below, and to 
restore core funding that has decreased in recent years, I urge the 
Committee to fund NOAA at $4.5 billion for fiscal year 2008 and to do 
so while maintaining vital support for other portion's of the 
Subcommittee's research and development portfolio.
    National Weather Service (NWS).--The fiscal year 2008 President's 
request for NWS contains modest growth above the fiscal year 2007 
request and joint resolution. This amount will modestly help to ease 
demoralizing pressures put on NWS operations staff in recent years. 
Unfortunately, several important programs continue to fare poorly. The 
Space Environment Center (SEC) provides space weather and solar 
radiation warnings for, among other things, modern telecommunications 
and electricity grid operations. Yet the fiscal year 2008 request is 
only $6.2 million, down from $7.3 million in fiscal year 2007. The NOAA 
Profiler Network (NPN) gathers vertical wind data of proven value for 
weather prediction and severe storm warnings. We appreciate the stated 
commitment to beginning the NPN conversions needed to avoid a near 
complete shutdown by 2010, but note that the fiscal year 2008 request 
would leave 90 percent of the conversions to be completed in only two 
years. Additional funds in the PAC account for NPN may provide a more 
realistic completion schedule. The U.S. Weather Research Program 
(USWRP) request reduces funding to multi-national cooperative research 
efforts by $1.5 million, in particular pulling out of the THORPEX 
Pacific-Asia Regional Campaign (T-PARC) designed to improve pacific 
coast winter storm forecasts. This would renege on U.S. commitments and 
slow forecast improvements. I urge the Committee to increase the 
President's fiscal year 2008 request of $903.5 million for the NWS by 
the amount necessary, approximately $3.5 million to fund SEC, NPN, and 
THORPEX at reasonable levels.
    Office of Oceanic and Atmospheric Research (OAR).--The OAR fiscal 
year 2008 budget request is $368.8 million, a decrease of over $10.0 
million from the fiscal year 2006 enacted level. The fiscal year 2008 
request will allow modest increases for implementation of the National 
Integrated Drought Information System (NDIS) and improving hurricane 
intensity research, extremely important and timely progress that we 
welcome. The climate research programs of OAR, including the 
competitive grants program within Climate and Global Change, have been 
combined into a new account titled, Competitive Research Program. Since 
the overwhelming percentage of the programs funded within this account 
are operated by NOAA and not open to competition, this new title is 
misleading. However, many of the programs within this account are 
certainly of importance to the atmospheric sciences community, in 
particular the extramural, merit-based grants program which could 
address shortfalls in critical areas such as badly needed improved 
observations provided through programs such as ARGO, if it were fully 
funded. I urge the Committee to provide at least the President's fiscal 
year 2006 enacted level of $379.6 million for OAR in fiscal year 2008 
in order to allow for a robust and truly competitive extramural climate 
research program.
    National Environmental Satellite, Data and Information Service 
(NESDIS).--NESDIS is responsible for managing all aspects of NOAA's 
remotely gathered environmental data that form the basis for 
environmental research meeting the needs of policy makers and users. 
Continued support for the Global Earth Observation System of Systems 
(GEOSS) is appreciated, but the overall NESDIS request is down as is 
the request for the National Data Centers which are of critical 
importance in making data available to researchers and policy makers. 
Our community is well aware of the significant budget problems that the 
National Polar-orbiting Operational Environmental Satellite (NPOESS) 
will surely cause as it becomes operational. The NPOESS program is 
essential to maintaining and upgrading a comprehensive satellite and 
surface observational system, 40 percent of which, according to a 
recent NRC report, is quickly coming to the end of its functional life. 
At a time when the nation should be fixing the NPOESS problem, we do 
not understand how NESDIS could be slated for a budget cut. I urge the 
Committee to protect other NOAA research and operational programs that 
serve this nation well, while addressing the NPOESS issue and giving 
NESDIS the resources it needs in fiscal year 2008 to keep this country 
ahead of all others in our ability to gather environmental data that 
are essential for policy decisions, the management of resources, and 
the health of our economy.
    National Ocean Service (NOS) and Ocean Research Priorities Plan.--
NOAA is the nation's preeminent agency for ocean research and for the 
transfer of research results into products and services that affect the 
health of the oceans, coastlines, and coastal water sheds; the nation's 
economy; and the well being of many U.S. citizens. In 2004, the U.S. 
Commission on Ocean Policy recommended approximately $3 billion in 
projects to improve the state of our oceans, yet NOAA's budget has 
fared poorly since then and many ocean programs of NOAA have been cut. 
There is an urgent need to implement programs such as the Integrated 
Ocean Observing System at this particular time when our environment is 
changing rapidly and we need to monitor changes in the oceans as well 
as interactions between the atmosphere and oceans. I urge the Committee 
to fund NOS at the fiscal year 2006 enacted level of $590.4 million in 
fiscal year 2008.
    The Administration has recently completed and released an 
interagency Ocean Research Priorities Plan and implementation strategy 
in a report entitled Charting the Course for Ocean Science in the 
United States for the Next Decade. This plan is an important first step 
toward building the scientific foundation to improve society's 
stewardship and use of, and interaction with, the ocean and 
understanding its impact on our weather and climate systems. I urge the 
Congress to examine this interagency plan closely--particularly as it 
relates to NSF and NOAA--and provide as much support as possible for 
its implementation.
    On behalf of the UCAR community, I want to thank the Committee for 
your stewardship of the nation's scientific enterprise and your 
understanding that the future strength of the nation depends on the 
investments we make in science and technology today.
                                 ______
                                 
     Prepared Statement of the National Marine Sanctuary Foundation
    Dear Chairwoman Mikulski and Ranking Member Shelby: We, the Board 
of Directors of the National Marine Sanctuary Foundation, are writing 
as supporters of the oceans programs of the National Oceanic and 
Atmospheric Administration (NOAA). We strongly encourage you to 
consider appropriations for NOAA at the $4.5 billion level for fiscal 
year 2008.
    This investment in NOAA yields great returns for the nation, 
especially when you consider that over half of the nation's gross 
domestic product is generated in coastal counties and adjacent waters, 
yielding $2.5 trillion. Through its weather forecasting, nautical 
charting, fisheries management, hazard mitigation, and ocean protection 
and management responsibilities, no other federal agency affects this 
country's 300 million Americans every day the way NOAA does. An 
investment of $4.5 billion averages out to just $15 per person 
annually.
    Despite the many benefits NOAA provides, shifts in funding 
priorities in recent years have led to substantial cuts in key NOAA 
programs with long-standing reputations for excellence. The National 
Marine Sanctuary System (NMSS), for example, is a crucial thread in the 
larger fabric of ocean science, conservation and education. To enhance 
and sustain the effectiveness of the system, we strongly urge you to 
fund NMSS at no less than $78 million for fiscal year 2008, which would 
restore the fiscal year 2005 enacted level and provide a $10 million 
increase to support the system's growth since then.
    The National Marine Sanctuary System includes 14 sites nationwide 
that serve as living laboratories, classrooms, and playgrounds for all 
Americans by making areas of the ocean realm manageable and accessible 
for state and local partners, research centers, educators, and other 
partners. The most recent addition to the system is the newly 
designated (June 2006) Northwestern Hawaiian Islands Marine National 
Monument, which provides 140,000 square miles with the nation's highest 
form of marine environmental protection, while preserving access for 
native cultural activities and allowing for carefully regulated 
educational and scientific activities.
    During this fiscal year 2008 appropriations process, we urge you to 
be the ocean champion that this country so desperately needs by 
supporting a $4.5 billion appropriation for NOAA, which would 
collectively provide critical funding for many important ocean programs 
and activities around the nation, including the National Marine 
Sanctuary System, the Ocean Exploration Program, the National Sea Grant 
College Program, the Education Initiative, and many others. Such NOAA 
programs are not only vital to our nation's environment, economy, and 
competitiveness, but also to the health and well being of every 
resident of your state. 


                                 ______
                                 
    Prepared Statement of the Northwest Indian Fisheries Commission
    Thank you for the opportunity to appear before this Committee and 
provide oral testimony on the Department of Commerce fiscal year 2008 
appropriations. We support full funding for the NOAA Fisheries and 
NOAA-National Ocean Service (NOS) budgets that include appropriations 
necessary for key Federal and State partnerships with the twenty Treaty 
Indian Tribes in Western Washington. We would like to highlight the 
following requests:
           summary of fiscal year 2008 appropriations request
    NWIFC Specific Requests:
  --$100 million for the Pacific Coastal Salmon Recovery Fund with a $9 
        million allocation for the twenty affected Treaty Tribes in 
        Western Washington for their management responsibilities and 
        the Northwest Indian Fisheries Commission along with support 
        language (NOAA/National Marine Fisheries)
  --$500,000 for Coastal Marine Resource Management
$100 million for the Pacific Coastal Salmon Recovery Fund with a $9 
        million allocation for the twenty affected Treaty Tribes in 
        Western Washington and the Northwest Indian Fisheries 
        Commission
    The Pacific Coastal Salmon Recovery Fund (PCSRF) is a multi-state, 
multi-tribe program established by Congress in fiscal year 2000 with a 
primary goal to help recover wild salmon throughout the Pacific 
Northwest and Alaska. The PCSRF seeks to aid the conservation, 
restoration and sustainability of Pacific salmon and their habitats by 
financially supporting and leveraging local and regional efforts. 
Recognizing the need for flexibility among Tribes and the States to 
respond to salmon recovery priorities in their watersheds, Congress 
earmarked the funds for salmon habitat restoration, salmon stock 
enhancement, salmon research, and implementation of the 1999 Pacific 
Salmon Treaty Agreement and related agreements. PCSRF is making a 
significant contribution to the recovery of wild salmon throughout the 
region. Since the program's inception, Pacific coastal Tribes, 
including the 20 Treaty Tribes in Western Washington, who are members 
of the NWIFC, have used PCSRF monies to remove 79 fish passage 
barriers-opening up 47 stream miles; restore 282 miles of instream 
habitat; restore 747 acres and 113 stream miles of riparian habitat; 
restore 129 acres of wetland habitat and protect 288 acres of habitat 
through land acquisition, easement or lease. The Tribes are using these 
funds to implement the recovery plan for ESA-listed Puget Sound Chinook 
recently approved by NOAA. However, even though Tribes were to receive 
at least a 10 percent set aside from PCSRF funding every year, the $90 
million base dropped to $67 million in fiscal year 2006 and Tribes were 
disproportionately cut to $4.4 million. Restoration of these funds to 
support this important recovery work by the Tribes is vital.
$500,000 for Coastal Marine Resource Management
    The NOAA/Marine Sanctuary Program has provided nominal funding from 
its base to enable the four coastal Tribes to effectively participate 
in sanctuary management, based on the federal/state/tribal Memorandum 
of Understanding that established the Intergovernmental Policy Council 
earlier this year. National programs currently are in place and budgets 
exist and are funded for the NOAA/National Marine Sanctuary Program. 
Early planning and negotiation has occurred, setting the framework for 
Pacific Ocean planning. This funding will allow Tribes to build their 
staffing expertise and support their policy involvement in the later 
detailed work processes.
    The economic value associated with effective marine resource 
protection is huge. Not only are marine areas crucial for our natural 
resources and those that use them; they are bridges of commerce between 
nations and continents. Healthy oceans are essential if we value stable 
climates that will sustain our economies and our lives. Tribes must be 
partners in the efforts to research, clean up and restore the environs 
necessary to deal with such problems as:
  --Damage to Dungeness Crab Fisheries--The State commercial crab 
        season annually nets more than 20 million pounds of Dungeness 
        crab, valued at nearly $1 billion. Tribes presently harvest a 
        fraction of that amount. Yet declining salmon runs caused by 
        lost and degraded habitat have made fisheries such as those for 
        Dungeness crab increasingly important to Tribal communities.
  --Groundfish, such as black cod, whiting and halibut have also grown 
        in economic importance to Tribes. Unfortunately, just as 
        coastal Treaty Tribes are beginning to fully access some of 
        their treaty-reserved harvest of groundfish, several rockfish 
        species have declined sharply. As a result, severe harvest 
        restrictions have had to be implemented, threatening the 
        cultural, spiritual and economic vitality of coastal Treaty 
        Tribes.
    As co-managers of groundfish with the Federal and State 
governments, Tribes want to work collaboratively to address a 
significant lack of data on groundfish populations. Better data will 
enable Tribes to make more informed management decisions. Better data 
also facilitates the move to an ecosystem-based management approach 
that takes into consideration the differences among groundfish 
populations in different areas.
    Tribes have proven that we can bridge different interests for the 
good of the whole. Tribes have been actively involved in marine issues 
off the coast of Washington. As described earlier, Tribes, NOAA and the 
State of Washington have jointly signed a working MOU to guide Olympic 
Marine Sanctuary planning and implementation. The Tribes also 
participate in the State Ocean Policy Workgroup. Besides State and 
Federal government partners, the Tribes work closely with business, 
industry, sportsman and commercial fishing groups, environmental and 
community groups and individuals. Incidentally, Tribes are also key 
partners in the Puget Sound Shared Salmon Strategy and the Puget Sound 
Partnership. Tribal leaders have consistently been early advocates, 
leaders and technicians as these efforts were brought to fruition.
                               background
    When our ancestors signed treaties, ceding millions of acres of 
land to the United States government, they reserved fishing, hunting 
and gathering rights in all traditional areas. These Constitutionally-
protected treaties, the Federal Trust Responsibility and extensive case 
law, including the U.S. v. Washington Decision of 1974, all 
consistently support the role of Tribes as natural resource managers, 
on and off reservation. In Washington State, these provisions have 
developed into a generally successful co-management process between the 
Federal, State and Tribal governments. The co-management route is the 
one and only path that leads to true sustainability in our region, and 
is the tool that must be used to meet the many environmental challenges 
we face, such as polluted and over-appropriated waters, species decline 
and climate change. Treaties are nation-to-nation accords, and Tribes 
have always been outstanding natural resource managers and stewards of 
the land.
    However, the Federal government has chosen to cut funding to Tribal 
natural resource management programs over the past six years. There is 
no question that this jeopardizes the bond of trust between our 
governments. It also jeopardizes management programs and infrastructure 
critically important to co-management and to the health and vitality of 
natural resources, and the Tribal and non-tribal people they sustain. 
The timing of funding cuts could not have been worse. We are facing 
many environmental and natural resource management challenges in the 
Pacific Northwest, caused by human population expansion and urban 
sprawl, increased pollution problems ranging from storm water runoff to 
de-oxygenated or ``dead'' areas in the Hood Canal, parts of Puget Sound 
and in the ocean off the coast. The pathway to the future is clear to 
us. The Federal, State and Tribal governments must strengthen our bond 
and move forward, together, with the determination and vigor it will 
take to preserve our heritage. Together, we must focus on the needs of 
our children, with an eye on the lessons of the past.
                              our message
    Our message to you now is that achieving such objectives requires 
adequate funding. The Tribes strive to implement their co-management 
authority and responsibility through cooperative and collaborative 
relationships with the state and local communities. We constantly seek 
ways to restore and manage these precious natural resources in a manner 
that can be supported by all who live in this area. The work the Tribes 
do benefits all the citizens of the State of Washington, the region and 
the nation. But the increasing challenges I have described and the 
growing demand for our participation in natural resource/environmental 
management requires increased investments of time, energy and funding. 
Restoring and protecting these natural resources is essential to the 
economy and the quality of life that is so valued by those who live in 
the Northwest.
    We are sensitive to the budget challenges that Congress faces. We 
recognize that this Administration has greatly reduced the allocation 
to discretionary domestic spending during the last several years, which 
makes it increasingly difficult to address the many requests you 
receive. Still, we urge you to maintain and increase the allocation and 
appropriations for priority ecosystem management initiatives. The need 
for an ecosystem-based management approach for Washington's marine 
waters have come into sharp focus in recent years. Major studies by the 
U.S. Commission on Ocean Policy and the Pew Charitable Trust, and the 
appearance of the low-oxygen dead zones are clear signals that the 
health of our rivers and marine waters is in rapid decline. In its 
report, ``An Ocean Blueprint for the 21st Century,'' the Ocean 
Commission essentially concluded that the oceans are sick, and 
estimated the costs for reversing declines and restoring coasts and 
oceans nationwide at about $4 billion annually. Follow through on that 
report has obviously not approached that level of investment--and it 
might not for some time. But, for the sake of sustainable health, 
economies and the natural heritage that sustains them, it is critically 
important for Congress to do more than it has, and to direct federal 
agencies to do even more to coordinate their efforts with State and 
Tribal governments.
    In Washington State, the Ocean Policy Workgroup, created by Gov. 
Chris Gregoire, was an outgrowth of the Ocean Commission. This group 
consists of 20 members, made up of state agency heads, legislators, the 
Governor's Office and Tribes. Among the group's recommendations was the 
creation of a governing board and council, with representatives from 
management agencies and Tribes, scientific communities, and stakeholder 
groups, to establish management needs, align research priorities and 
monitor the progress through specific work plans. We have been actively 
engaged in this process, and see great value in continuing our 
participation. We also look forward to increased participation in 
multi-state agreements and efforts on the Pacific Coast as well as the 
Puget Sound Estuary. Tribes hope to stay active with the Ocean Policy 
Workgroup, as well as with such programs as the Oil Spill Advisory 
Committee. Early this year, the coastal Treaty Indian Tribes, the State 
of Washington and the U.S. Government created a policy council to guide 
the Olympic Coast National Marine Sanctuary. An MOA between the parties 
has resulted in the creation of an Inter-governmental Policy Council 
with members from each coastal Tribe and the State to ensure 
coordinated and comprehensive management of the sanctuary and its 
resources. Related to all of these efforts, we look forward to 
participating in the development of a coast-wide cooperative ecosystem 
management approach in response to the Ocean Commission Report.
    As frequently attributed to Chief Seattle (Sealth), Tribes believe 
all things are connected. That is why we believe only through a 
holistic ecosystem management approach can we find success in achieving 
a healthy environment and robust natural resources. We believe failure 
to deal with the natural resource/environmental challenges forced upon 
us, with an ecosystem approach, can only result in ruinous impacts on 
treaty-protected resources.
    All of this requires adequate funding.
                               conclusion
    Clearly, Western Washington Tribes are leaders in the Northwest 
salmon recovery effort. The Tribes possess the legal authority, 
technical and policy expertise, and effective programs to address 
impacts on wild salmon from harvest and hatcheries. The Tribes are 
strategically located in each of the major watersheds, and no other 
group of people knows salmon like the Tribes. No one else so deeply 
depends on salmon for their cultural, spiritual and economic survival 
either, although the habitat and salmon restoration work we do will 
definitely benefits everyone who lives here. Tribes seize every 
opportunity to coordinate with other governments, and non-governmental 
entities, to avoid duplication, maximize positive impacts and emphasize 
the application of holistic ecosystem management. We continue to 
participate in salmon recovery, habitat restoration, etc. on an equal 
level with the State, because we understand the great value of such 
cooperation. It is said that salmon are our miners' canary. They 
absolutely depend on clean water and healthy habitat--and so do we. We 
ask Congress to help us in the effort to restore salmon, other species 
and habitat by supporting our funding requests.
    I thank the Committee for allowing me this opportunity to make 
these budget requests of the fiscal year 2008 Appropriations for the 
Department of Commerce.
                                 ______
                                 
Prepared Statement of the Population Association of America/Association 
                         of Population Centers
                              introduction
    Thank you, Senator Mikulski, Senator Shelby, and other 
distinguished members of the Subcommittee, for this opportunity to 
express support for the Census Bureau and the National Science 
Foundation (NSF), two agencies important to the Population Association 
of America and the Association of Population Centers (PAA/APC).
           background on the paa/apc and demographic research
    The PAA is an interdisciplinary, scientific organization comprised 
of over 3,000 research professionals, including demographers, 
economists, sociologists, and statisticians. The APC is a similar 
organization comprised of over 30 universities and research groups that 
foster collaborative demographic research and data sharing, translate 
basic population research for policy makers, and provide educational 
and training opportunities in population studies.
    Demography is the study of populations and how and why they change. 
Demographers, as well as other population researchers, collect and 
analyze data on trends in births, deaths, immigration and disabilities 
as well as racial, ethnic and socioeconomic changes in populations. 
Among the major policy issues, population researchers study the 
demographic causes and consequences of population aging, trends in 
fertility, marriage, divorce and their effects on the health and well 
being of children, and immigration and migration and how these patterns 
affect the ethnic and cultural diversity of our population and the 
nation's health and environment.
    PAA/APC members rely on a number of federal agencies charged with 
funding demographic research and generating reliable, accessible data. 
The ability of our members to produce meaningful research, often used 
to inform policy decisions, requires the use of substantial data sets 
and support for research projects and research training.
                           the census bureau
    The Census Bureau is the premier source of information about the 
American people and the U.S. economy. In addition to the decennial 
census and the American Community Survey, the Census supports a variety 
of surveys to measure changes in individual and household demographic 
and economic conditions. PAA and APC members rely on accessible data 
produced by the Census Bureau to conduct their research.
                      national science foundation
    The mission of NSF is to promote the progress of science; to 
advance the national health, prosperity, and welfare; and to secure the 
national defense. The demography of our population directly impacts the 
health, prosperity, welfare, and security of our nation. NSF support of 
demographic research, particularly its support of large-scale 
longitudinal surveys, such as the General Social Survey and Panel Study 
of Income Dynamics, is central to the agency's mission and essential 
for the field of population research. NSF provides about 20 percent of 
all federally supported basic research conducted by America's colleges 
and universities, including basic behavioral and social research. 
Demographic research also depends on support from NSF for support of 
individual research projects and research centers.
                            recommendations
    PAA and APC urge you to support the Administration's request for 
the Census Bureau, which is $1.23 billion in fiscal year 2008. 
Substantial preparation is required to ensure the success of an 
accurate 2010 Census and fully implemented American Community Survey. 
In 2008, the Census Bureau will be conducting the only dress rehearsal 
of the decennial census. The rehearsal, which will be conducted in San 
Joaquin County, California, and nine counties in the Fayetteville area 
of North Carolina, will evaluate the integrated census plan in a 
census-like environment. Also, in 2008, the Bureau will design and test 
a system for capturing and processing census data, open 12 regional 
census centers nationwide, and verify address information submitted by 
state, local, and Tribal governments. All of these key planning, or 
ramping up, activities are central to the success of the 2010 Census. 
Thus, it is imperative the Bureau receive the Administration's request 
in 2008. Receiving anything less than the President's request, 
jeopardizes the accuracy of the 2010 Census, increasing the chances of 
over counts, undercounts, and, ultimately, geographic misallocations of 
federal resources, and threatens the availability of key demographic 
and economic data researchers and policymakers require.
    PAA and APC, as members of the Coalition for National Science 
Funding, support the President's budget request for NSF in fiscal year 
2008, which is $6.43 billion. This budget will enable the NSF Social, 
Behavioral and Economic Science Directorate (SBE) to continue its 
support of social science surveys and a rich population research 
portfolio. Furthermore, the proposed budget will enable SBE to fully 
implement the Science of Science and Innovation Policy initiative. The 
goal of this initiative is to develop an evidence-based platform from 
which policymakers and researchers may assess the impacts of the 
Nation's science and engineering enterprise.
    The Census Bureau and the National Science Foundation support, 
indirectly and directly, the collection and availability of rich data 
sources to PAA/APC members. Our economists, statisticians, and social 
survey design experts rely on federally supported data to conduct their 
research and inform public policy. Investments in these data sets are 
investments in good policy.
    Thank you for considering our requests and for supporting federal 
programs that benefit the field of demographic research.
                                 ______
                                 
 Prepared Statement of the National Association of Marine Laboratories
    Madam Chair and Members of the Subcommittee, on behalf of the 
National Association of Marine Laboratories (NAML) I am pleased to 
submit this statement in strong support of the research and education 
programs under the subcommittee's jurisdiction that are vitally 
important for a vibrant oceans, coastal, and Great Lakes research and 
education enterprise. I will focus my remarks on four key areas: 
federal extramural research funding, innovation and competitiveness, 
implementation of ocean commission recommendations and other federal 
ocean research reports, and ocean education, literacy and workforce 
development.
    NAML (www.naml.org) is a nonprofit organization of over 120 
institutions employing more than 10,000 scientists, engineers, and 
professionals and representing ocean, coastal and Great Lakes 
laboratories stretching from Maine to the Gulf of Mexico, Guam to 
Bermuda, and from Alaska to Puerto Rico. NAML labs support the conduct 
of high quality ocean, coastal and Great Lakes research and education 
in the natural and social sciences and the effective use of that 
science for decision-making on the important issues that face our 
country.
federal support for extramural ocean, coastal and great lakes research 
                           and infrastructure
    NAML strongly urges federal commitment to enhance support for 
cutting-edge ocean, coastal, and Great Lakes research and 
infrastructure across federal funding agencies.
    The marine sciences have much to offer the Nation as it seeks to 
strengthen its ability to innovate and compete in today's global 
economy. They are inherently interdisciplinary, address science, 
technology, engineering, and mathematics (STEM) disciplines, push the 
envelope in terms of technology development, test the boundaries of our 
data collection and analysis systems, and offer an effective training 
ground for future scientists and engineers. NAML asks that the value of 
extramural research funding at all relevant federal agencies not be 
overlooked, but recognized as essential to the overall progress of 
coastal, ocean and Great Lakes science and education. Further, in order 
to support this research and ensure that this country is achieving the 
best possible results, all types of infrastructure-marine laboratories, 
observatories, ships, underwater vehicles, and satellites-must be 
supported across the board.
  --National Science Foundation.--NAML supports increased federal 
        funding for the National Science Foundation (NSF) consistent 
        with the President's budget request of $6.5 billion for fiscal 
        year 2008. Basic research and the transfer and use of the 
        knowledge developed through research are vital for the long-
        term economic competitiveness and national security of this 
        Nation. NSF provides vital support for basic research and 
        education which enhances public understanding of the Nation's 
        oceans, coastal areas, and the Great Lakes. NSF also provides 
        important support for basic laboratory facilities, 
        instrumentation, support systems, computing and related 
        cyberinfrastructure, and ship access. The final report of the 
        U.S. Commission on Ocean Policy makes several recommendations 
        on the need to develop and enhance ocean, coastal and Great 
        Lakes research infrastructure. To that end, NAML strongly 
        supports the development of the Ocean Observatories Initiative 
        at NSF. Further, NAML urges the Subcommittee to significantly 
        enhance the NSF Major Research Instrumentation (MRI) program 
        and its Field Stations and Marine Laboratories (FSML) program. 
        FSML is of particular interest to marine labs as it provides 
        researchers with access to state of the art instrumentation for 
        research and education and necessary cyberinfrastructure and 
        data management systems that compliment the Ocean Observatories 
        Initiative. We urge the Subcommittee to double the modest FSML 
        budget from $2.5 million to $5 million for fiscal year 2008 and 
        further request that the program ultimately be increased to $10 
        million annually.
  --National Oceanic and Atmospheric Administration.--NAML requests a 
        top-line appropriation of $4.5 billion for NOAA for fiscal year 
        2008. This is consistent with the position take by the Friends 
        of NOAA (www.friendsofnoaa.org) coalition which represents a 
        diverse group of NOAA stakeholders.
      A Congressionally requested study of NOAA's research programs, 
        entitled, Review of the Organization and Management of Research 
        in NOAA completed August 2004, concluded that extramural 
        research is critical to accomplishing NOAA's mission. The 
        access to such enhanced research capacities provides NOAA with 
        world-class expertise not found in NOAA laboratories; 
        connectivity with planning and conduct of global science; means 
        to leverage external funding sources; facilitation of multi-
        institution cooperation; access to vast and unique research 
        facilities; and access to graduate and undergraduate students. 
        Academic scientists also benefit from working with NOAA, in 
        part, by learning to make their research more directly relevant 
        to management and policy. It is an important two-way 
        interaction and exchange of information.
      NAML strongly supports robust NOAA extramural research activities 
        expressed though such programs as the National Sea Grant 
        College Program, the National Undersea Research Program (NURP), 
        Ocean Exploration, research related to aquaculture, invasive 
        species, and the various joint and cooperative institutes 
        supported by NOAA. The Bush Administration has proposed to 
        maintain the Sea Grant program at $55 million for the third 
        straight year. Sea Grant is already feeling the pinch of a 
        flat-funding environment and the President's request will only 
        further hinder the programs' ability to address local, regional 
        and national ocean research and education needs. A budget of 
        $72 million for Sea Grant will allow the program to mend past 
        cuts and address emerging needs facing our coasts. In addition, 
        the Bush Administration has proposed to the merge NURP with the 
        Ocean Exploration program. NAML hopes that if or when this 
        merger comes to fruition the new program will still provide an 
        extramural research component that is so valued by the research 
        community. While the merger of the two programs is still under 
        development, we support funding NURP at $20 million and Ocean 
        Exploration at $28 million for fiscal year 2008. These noted 
        partnership programs are not only consistent with the findings 
        of the August 2004 review of NOAA research, but are also 
        consistent with NOAA's missions. As such they should be 
        strongly supported and made accessible to the ocean, coastal, 
        and Great Lakes research community on a competitive basis.
      NAML is encouraged that the Administration has included in its 
        budget request for fiscal year 2008 a line for the development 
        of an Integrated Ocean Observing System (IOOS) within NOAA with 
        $16 million set aside for initial funding. However, the amount 
        needed to sustain and enhance current observing system efforts 
        by the research community is closer to $100 million annually. 
        Integrated observations offer critical information on coastal 
        processes necessary for addressing issues, such as the health 
        of humans and marine life, weather and climate nowcasts and 
        forecasts, homeland security, and resource management. Much 
        work is still needed to shape the federal government's 
        involvement in IOOS and larger global observing efforts. NAML 
        urges the Subcommittee to provide adequate funding for IOOS in 
        fiscal year 2008 consistent with the needs of the community.
  --National Aeronautics and Space Administration.--NASA's support for 
        earth and space sciences is vital in helping us better 
        understand our planet. NASA's Earth Science Applications theme 
        benchmarks practical uses of NASA-sponsored observations from 
        Earth observation systems and predictions from Earth science 
        models. The National Academy of Sciences released a report \1\ 
        this year which calls on NASA to ``renew its investment in 
        Earth observing systems and restore its leadership in Earth 
        science and applications.'' NAML is one of many groups that 
        believe we need a balanced investment in NASA that will 
        maintain a strong and vibrant earth and space science 
        enterprise. If we are concerned about the fate of the planet, 
        NASA's support for science is absolutely crucial to 
        understanding and ultimately deciding how to address the 
        concerns we are facing. NAML urges the Subcommittee to renew 
        its investment in the NASA Earth Science budget for fiscal year 
        2008.
---------------------------------------------------------------------------
    \1\ Earth Science and Applications from Space: National Imperatives 
for the Next Decade and Beyond, Committee on Earth Science and 
Applications from Space: A Community Assessment and Strategy for the 
Future, National Research Council, January 2007.
---------------------------------------------------------------------------
                     innovation and competitiveness
    NAML strongly supports efforts by the Administration and Congress 
to strengthen the nation's position as a world leader in scientific 
innovation and competitiveness.
    As the Nation seeks to expand its investment in the physical 
sciences to increase its international competitiveness, NAML calls on 
the Subcommittee to recognize the integrated and strategic relationship 
between all scientific and engineering disciplines and to support an 
enhanced investment in science and technology across the board as part 
of any long-term economic competitiveness policy. NAML is encouraged 
that the federal government has begun focusing on the physical sciences 
for targeted funding increases, particularly through efforts to double 
the budget of the National Science Foundation (NSF) over the next 10 
years. However, we must ensure that the entire breadth of the physical 
sciences, which include the earth and ecosystem sciences as well, is 
supported so we do not hinder this nation's true innovative potential. 
Other federal agencies involved in the ``physical sciences'' need to be 
supported within the context of innovation, namely the extramural 
research programs within the National Oceanic and Atmospheric 
Administration (NOAA) and the National Aeronautics and Space 
Administration (NASA). Improvements in the quality of education 
provided to our students with a strong foundation in math and science 
as well as support for universities and laboratories that provide 
world-class education and research opportunities will only benefit the 
nation and its science enterprise. As the Subcommittee sets its funding 
priorities for the year we hope it will consider the relevance of NOAA 
and NASA to U.S. innovation and competitiveness.
 implementation of ocean commission recommendations and other federal 
                         ocean research reports
    NAML continues to strongly support implementation of the 
recommendations made by the U.S. Commission on Ocean Policy (2004) \2\. 
In addition, NAML looks forward to the implementation of the 
interagency Ocean Research Priorities Plan (2007) \3\.
---------------------------------------------------------------------------
    \2\ An Ocean Blueprint for the 21st Century, U.S. Commission on 
Ocean Policy, April 20, 2004.
    \3\ Charting the Course for Ocean Science in the United States for 
the Next Decade: An Ocean Research Priorities Plan and Implementation 
Strategy, NSTC Joint Subcommittee on Ocean Science and Technology, 
January, 2007.
---------------------------------------------------------------------------
    NAML believes that public policy with respect to the nation's 
oceans, coasts and Great Lakes should always be based on sound science 
and the most up-to-date information. The U.S. Commission on Ocean 
Policy's analysis of existing policies and future needs has resulted in 
a collection of bold and broad-reaching recommendations for reform. The 
Congress has taken these recommendations to heart in recent years and 
has begun addressing the nation's ocean needs. Federal implementation 
of these recommendations will enable the United States to maintain and 
strengthen its role as a world leader in protecting and sustaining the 
planet's oceans and coasts. NAML is particularly supportive of the 
Commission's recommendation to re-align NOAA's functions to support 
ecosystem-based management approaches. In addition, we fully endorse 
the Commission's recommendations to double the federal investment in 
ocean, coastal, and Great Lakes research as well as its recommendation 
to promote a strong federal investment in ocean, coastal, and Great 
Lakes education, outreach, and stewardship.
    As the Bush Administration states in its decade-focused Ocean 
Research Priorities Plan, ``Scientific discovery driven by competitive 
peer-reviewed investigations is the foundation of the nation's research 
enterprise.'' This plan identifies the nation's most urgent short- and 
longer-term ocean research needs. NAML is encouraged that the 
Administration proposed new funding for ocean issues in its budget 
request for fiscal year 2008. However, we urge the Administration and 
Congress to not overlook the importance of the extramural research 
community to the implementation of the plan's goals. The external 
research community stands equipped and ready to assist the federal 
government in implementing its identified priorities. NAML hopes that 
the dedication to ocean, coastal and Great Lakes issues expressed by 
the federal government in recent years will continue and be further 
enhanced to ensure that the external research community is being 
utilized to the fullest extent possible as the valuable resource that 
it is. In order to be successful, the federal government will need to 
look to the extramural research community to tap into existing 
capabilities to ensure that they are taking the most practical approach 
to ocean governance.
     ocean education, literacy, outreach and workforce development
    NAML believes that an ocean literate populace will lead to a well-
informed and safe nation. NAML encourages the federal government to 
strengthen its commitment to enhancing ocean, coastal and Great Lakes 
education, literacy and outreach as well as workforce development.
    A strong national ocean policy can only be sustained with the most 
up-to-date and reliable scientific information. To ensure that the 
nation will continue to have the ability to address emerging ocean 
issues in the future, investments are needed today in coastal, ocean, 
and Great Lakes education programs that support learning at all age 
levels, by all disciplines, and for all Americans. NAML strongly 
supports the NSF Centers for Ocean Science Education Excellence (COSEE) 
program, NSF education and human resources generally, and NOAA's Office 
of Education. Such programs provide a rich environment for which 
collaborations and partnerships flourish. A greater understanding of 
the oceans and coastal ecosystems will instill in the American 
population a sense of stewardship for these important environments. 
These programs also yield a diverse workforce that includes a 
significant percentage from underrepresented groups. Preparing these 
cultural bridges would allow us to capitalize upon diverse national 
strengths, ensuring the flow of intellectual talent into ocean, 
coastal, and Great Lakes-related fields.
    NAML member laboratories contribute to maintaining a competitive 
and first-rate marine research and education workforce by providing a 
unique training ground that is conducive to on-the-job learning and 
mentoring. Marine labs, because of their flexibility and 
interdisciplinary nature, are leaders in addressing science, 
technology, engineering, and mathematics (STEM) education disciplines 
and hope to see support for these disciplines enhanced. Marine labs are 
also committed to enhancing diversity within the field of ocean, 
coastal and Great Lakes research and education by fostering 
relationships with community colleges and minority-serving institutions 
(MSIs) to provide distinctive learning opportunities for individuals 
who may not otherwise have an opportunity to participate in ocean, 
coastal and Great Lakes research. NAML hopes to be seen as a model to 
the nation for this type of collaboration.
    The 2006 Conference on Ocean Literacy (CoOL), which convened in 
Washington, DC, and at satellite sites throughout the country, provided 
an unprecedented national platform for discussion on the essential 
principles of ocean literacy and the current challenges and 
opportunities for both formal and informal education efforts in 
educating the public to make informed, responsible decisions about the 
ocean and its resources. NAML hopes that the topics addressed during 
this conference will continue to reach policymakers and the general 
public and will shape future ocean, coastal and Great Lakes education 
policy.
    Thank you for the opportunity to express these views on behalf of 
the National Association of Marine Laboratories. We hope the 
Subcommittee will take these points into consideration as you move 
forward in the fiscal year 2008 appropriations process.
                                 ______
                                 
            Prepared Statement of the Sea Grant Association
    Madam Chair and Members of the Subcommittee, on behalf of the Sea 
Grant Association (SGA) I respectfully submit this written testimony 
for the official record. Thank you for the opportunity to express these 
views. The Sea Grant Association joins with other stakeholders in 
urging the Subcommittee to recognize and support the vital research and 
outreach programs of the National Oceanic and Atmospheric 
Administration (NOAA). The community requests that the Subcommittee 
fund NOAA at $4.5 billion in fiscal year 2008. This is a modest request 
when considering the immense impact such an increase would have in 
terms of assisting NOAA in carrying out its mission: to understand and 
predict changes in the Earth's environment and conserve and manage 
coastal and marine resources to meet our Nation's economic, social, and 
environmental needs. Further, SGA requests that, within the overall 
fiscal year 2008 appropriation for NOAA, the Subcommittee appropriate 
$72 million in base funding for the National Sea Grant College Program. 
I will use the remainder of this statement to discuss why it is so 
important to support Sea Grant at realistic levels this year and in the 
future.
    The National Sea Grant College Program is a key component of NOAA's 
extramural research, education and outreach enterprise. This request of 
$72 million is well within the $103 million authorized for fiscal year 
2008 in Public Law 107-299, National Sea Grant College Program Act 
Amendments of 2002, and consistent with the level of base funding 
approved by your Subcommittee (Commerce, Justice and Science) last 
year. Further it is the amount supported in the Senate Dear Colleague 
Letter for Sea Grant which was submitted with 27 signatures to the 
Subcommittee on March 29, 2007 by Senators Maria Cantwell and Olympia 
Snowe.
    The Bush Administration's request of $55 million for fiscal year 
2008 would put Sea Grant at a hard freeze for the third year in a row. 
Implications of such a freeze for the nation with respect to the 
economy, sustainability of natural resources, and national safety and 
security are significant. With the costs of research and education 
rising, the flat-funding of Sea Grant during the last few years have 
forced programs to cut jobs and leave countless high-quality research 
and outreach projects unsupported. The Sea Grant network cannot sustain 
current activities, staff, and operations within this budget scenario. 
This request of $72 million would allow Sea Grant to sustain ongoing 
research and education efforts, address emerging needs, and continue 
assisting NOAA in carrying out its many missions.
                  science serving the nation's coasts
    Research and outreach programs supported by Sea Grant are based on 
competition, undergo rigorous peer-review, and are geared to address 
the many marine, coastal and Great Lakes challenges and opportunities 
that face our citizens. The federal investment in Sea Grant enables a 
nationally coordinated network embedded in the best research 
universities to apply unparalleled intellectual capital to address 
these problems and opportunities while assisting NOAA in addressing its 
missions. Cost-effectiveness is enhanced by access to existing 
university management infrastructure.
    Sea Grant serves the nation in many ways. Sea Grant's unmatched 
access to regional, state and local constituencies through its 
extension and outreach programs ensures that the federal investment is 
targeted at relevant issues. The Sea Grant model contributes to the 
missions of NOAA and other federal agencies, and state and local 
governments, to the benefit of the general public. In addition, marine 
education programs supported by Sea Grant funds reach from kindergarten 
to marine-related business people to elder hostels.
    Sea Grant is a national program addressing national, regional, 
state and local needs. It is a partnership among government, academia, 
business, industry, scientists, and private citizens to help Americans 
understand and wisely use our precious coastal waters and Great Lakes 
for enjoyment and long-term economic growth. This network unites 32 
Programs, over 300 universities, and millions of people. Sea Grant is 
an agent for scientific discovery, technology transfer, economic 
growth, resource conservation, and public education. It is government 
as our citizens want it--visible, tangible, relevant, efficient, and 
effective.
                           an economic driver
    Sea Grant is an investment in America's economic future. Attempts 
to balance our booming coastal economy with its associated impacts on 
the coastal and marine environment have raised the stakes for effective 
government action. America's ocean, coastal and Great Lakes resources 
encompass an immense area with more than 95,000 miles of coastline and 
more than 3.4 million square miles of ocean within the U.S. territorial 
sea. Over half the nation's 280 million people live in coastal counties 
that comprise less than one-fifth of the total land area of the United 
States. The economy of these coastal counties is critical to the 
economic well being of the entire nation, providing a wide array of 
goods and services that account for at least 50 percent of the gross 
national product of the United States. By 2010, U.S. foreign trade in 
goods is expected to double to $5 trillion, with ocean-going cargo 
increasing by 30 percent. Coastal tourism and recreation account for 85 
percent of all U.S. tourism revenues. The oceans, in one way or 
another, account for one out of every six jobs. Tax revenues in coastal 
areas are among the fastest growing revenue sources for state and local 
governments. In fact, the collective economic impact of the coastal 
economy far exceeds U.S. agriculture, and yet federal investments in 
Sea Grant colleges and universities are much smaller than investments 
in the Land Grant college and university system funded by the U.S. 
Department of Agriculture for agriculture and land-based natural 
resource activities, the program after which Sea Grant was modeled.
    Sea Grant has been leading the quest for practical solutions by 
providing research and education on national coastal and Great Lakes 
issues for four decades. Federal dollars appropriated to the Sea Grant 
program are leveraged and matched by state and private funds by at 
least 2 to 1, some states matching 60 percent or more. The matched 
federal investment fills an enormous demand for expertise to tackle 
rapid growth, change, and pressure on coastal resources. In addition, 
the 32 Sea Grant programs, located in every coastal, Great Lakes and 
Gulf Coast state, conduct policy-relevant research linked to an 
extensive outreach and education network. This structure ensures that 
Sea Grant research is useful to coastal resource managers at the 
regional, state and local levels, marine-related businesses and 
industries, and most importantly the general public. Some examples 
where Sea Grant has contributed to economic growth and vitality at the 
local, state and regional levels include:
  --Following the devastation of Hurricanes Katrina and Rita in the 
        Gulf Coast in 2005, approximately 3,000 commercial and 35,000 
        to 40,000 recreational boats were in need of salvage due to the 
        storms. The Washington and Alaska Sea Grant Programs donated a 
        surplus 60-ton Traveliftr from Alaska to Plaquemine Parish, 
        Louisiana. Without that hoist to move displaced boats to dry 
        land for repair, fishermen affected by the hurricanes would 
        have been out of work for several years, potentially costing 
        millions of dollars in loss to the fishing industry.
  --Sea Grant plays an instrumental role in nature-based tourism by 
        promoting low impact uses of natural resources. For example, 
        efforts to develop state designated underwater preserves have 
        led to new diving activity in Great Lakes coastal communities 
        providing an economic stimulus of at least $1.5 million over a 
        two-year period.
  --Sea Grant saved taxpayers $120,000 in the annual Beach Sweep/River 
        Sweep litter cleanup program in South Carolina. Over the past 
        14 years, more than 75,000 volunteers have collected 728 tons 
        of trash and have saved state taxpayers more than $1.6 million.
  --Sea Grant research efforts to develop new drugs from marine 
        organisms have resulted in discovery and description of more 
        than 1,000 compounds that may be vitally important to the 
        health industry.
  --Sea Grant training at 5,000 seafood processing plants will prevent 
        20,000 to 60,000 seafood-related illnesses a year, which could 
        cost consumers as much as $115 million annually.
  --Sea grant specialists are working directly with seaport managers, 
        resource managers, commercial interests and the general public 
        to address issues associated with ports, harbors and marine 
        transportation--ecological and economic centers of America's 
        coasts. For example, in Southern California, Sea Grant 
        continues to educate local businesses on maritime security and 
        business continuity in this, the busiest port complex in the 
        United States.
  --Sea Grant research and extension work with hybrid striped bass 
        aquaculture has expanded this species from being a 
        demonstration project ten years ago to a $25 million annual 
        business.
  --In North Carolina, 200 of the 205 new oceanfront homes built to the 
        Sea Grant hurricane standards survived Hurricane Fran in 1996, 
        compared to more than 500 older oceanfront houses in the same 
        area that were destroyed.
           a local approach to addressing national priorities
    Sea Grant has established long-standing working relationships with 
a broad spectrum of stakeholders in every coastal state. Because it is 
science-based and non-regulatory, Sea Grant is viewed as an honest 
broker among a wide range of constituents. The U.S. Commission on Ocean 
Policy called on Congress in its 2004 report to expand the Sea Grant 
program in conjunction with a doubling of all ocean and coastal 
research funding. Further, in January 2007, the Bush Administration 
released its inter-agency Ocean Research Priorities Plan and 
Implementation Strategy, Charting the Course for Ocean Science in the 
United States for the Next Decade. Several of the plan's most important 
priorities dovetail with Sea Grant's strength, experience, and 
relationships with state and local decision makers and ocean, coastal 
and Great Lakes resource managers. Here are just two examples:
    Sea Grant Increases Resiliency to Natural Hazards.--Coastal areas 
of the United States comprise only 10 percent of our nation's land 
mass, yet they are home to over half of all Americans. As witnessed by 
recent record-breaking storm seasons, coastal communities and the 
natural resources and infrastructure on which they depend are at 
increasing risk from hurricanes, tsunamis, coastal storms, shoreline 
change, and sea level rise. Sea Grant institutions and their partners 
pool research, education and outreach capabilities to enhance 
mitigation, preparedness, planning, education, response, and recovery 
in coastal communities throughout the nation. As a result of the 2005 
hurricanes, Sea Grant is working to improve storm modeling and 
community resiliency through regional research initiatives. In 
addition, Sea Grant is working closely with coastal communities to 
develop and implement long-term planning that will allow communities to 
become more resilient to storm events.
    Sea Grant is a Dedicated Steward of Natural and Cultural Ocean and 
Great Lakes Resources.--Domestic seafood production has not kept pace 
with consumer demand; the United States imports an ever-increasing 
amount of seafood consumed domestically. Issues with quality assurance 
and consistent supplies are increasing. At the same time, the nation's 
commercial seafood industry is threatened by the loss of coastal access 
and multiple use conflicts in coastal waters. Sea Grant institutions, 
through the use of their fisheries extension, address the increasing 
needs of the nation's seafood industry by utilizing expertise in 
seafood safety and technology and marine aquaculture.
    The above examples illustrate Sea Grant's connectivity to the 
Administration's stated priorities. As the federal government works to 
implement these priorities, we hope it will look to the National Sea 
Grant College Program--a major component of NOAA's extramural research 
arm--as a resource and as a partner.
    The SGA recognizes and appreciates the difficult funding tradeoffs 
the Subcommittee is forced to make each year. We urge you to consider 
Sea Grant as an investment in the future health and well-being of our 
coastal communities and support the program at $72 million in fiscal 
year 2008.
    Thank you for the opportunity to present these views.
                             about the sga
    The Sea Grant Association is a non-profit organization dedicated to 
furthering the Sea Grant program concept. The SGA's regular membership 
consists of the academic institutions that participate in the National 
Sea Grant College Program, located within the National Oceanic and 
Atmospheric Administration (NOAA). SGA provides the mechanism for these 
institutions to coordinate their activities, to set program priorities 
at both the regional and national level, and to provide a unified voice 
for these institutions on issues of importance to the oceans, coasts 
and Great Lakes. The SGA advocates for greater understanding, use, and 
conservation of marine, coastal and Great Lakes resources.
                                 ______
                                 
     Prepared Statement of the National Center for Victims of Crime
    The National Center for Victims of Crime submits this testimony to 
urge members of the Subcommittee on Commerce, Justice, Science, and 
Related Agencies to reject the Administration's proposed cancellation 
of the Victims of Crime Act (VOCA) Fund. This proposal would result in 
the removal of nearly $1.3 billion in funds currently designated to 
support crime victim services programs. Moreover, it would change VOCA 
from a reliable, offender-supported program to one dependent on annual 
appropriations from the General Treasury. Such an action would be 
disastrous for the state and local programs that already struggle to 
meet the needs of all crime victims. We urge Subcommittee members to 
instead raise the cap on VOCA Fund distributions by $375 million for 
the 2008 fiscal year and to provide further program stability by 
extending the time states have to spend this one-time increase in funds 
from the current four years to six years.
    As the leading national resource and advocacy organization for 
victims of crime, the National Center knows the considerable and urgent 
funding needs of those who serve crime victims. Since our founding in 
1985, we have worked with public and nonprofit agencies throughout the 
country, providing information, support, and technical assistance to 
thousands of victims, victim service providers, allied professionals, 
and advocates. Our toll-free information and referral Helpline alerts 
us to the needs of crime victims nationwide. Through our Training 
Institute and our daily interactions with both our members and the more 
than 11,000 crime victim service providers in our referral network, we 
stay informed of their work and know the impact of federal-level 
funding decisions on their ability to meet the needs of victims. In 
short, we hear from victims and service providers every day about the 
impact and importance of the VOCA Fund.
Understanding the VOCA Fund
    Congress created the VOCA Fund over twenty years ago to ensure on-
going, dedicated federal support for state and local programs for crime 
victims. The Fund receives no taxpayer dollars; it is made up of solely 
criminal fines and penalties imposed on federal offenders. Most of the 
funds are distributed each year by formula grants to the states to 
support two specific types of programs: (1) crime victim compensation 
programs; and, (2) crime victim assistance programs.
    Crime victim compensation programs directly reimburse crime victims 
or their families for many of the out-of-pocket expenses that directly 
result from the crime. These statutorily defined expenses include 
medical and counseling costs, funeral bills, crime scene cleanup, and 
lost wages. Essentially, these programs step in when victims have no 
insurance, no workman's compensation, and no other assistance available 
to help them meet expenses incurred as a result of the crime.
    In addition to compensation programs, the VOCA Fund supports more 
than 4,400 state and local victim assistance programs. Victim 
assistance programs include rape crisis centers, domestic violence 
shelters, victim assistants in law enforcement and prosecutor offices, 
and other direct service providers for victims of crime. For instance, 
the Fund supports: Child Protect, Inc., serving victims of child abuse 
in Montgomery, Alabama; the Shenandoah Women's Center, serving victims 
of domestic violence and sexual assault in Martinsburg, West Virginia; 
an advocate for elder victims of domestic violence at the Women's 
Community in Wausau, Wisconsin; Jackson Urban League, serving victims 
of homicide in Jackson, Mississippi; Advocates for Survivors of Torture 
and Trauma, serving victims of torture and war trauma in Baltimore, 
Maryland; the state MADD office in Baton Rouge, Louisiana; and the 
Virginia Network for Victims and Witnesses of Crime in Chesterfield, 
Virginia.
    VOCA assistance grant money is crucial in enabling both criminal 
justice system-based and community programs to serve victims of crime. 
As crime increases across the country, so too does the need for victim 
services. If VOCA funding remains stagnant or becomes unreliable due to 
a shift away from the current offender-supported system, states and 
their subgrantees will be unable to adequately address the needs of 
their communities. Moreover, their ability to reach more isolated and 
vulnerable populations will be diminished.
Why the VOCA Fund Currently Has a Balance
    Seven years ago, Congress acted to ensure the continuing stability 
of VOCA funding. For many years, all the money collected in a given 
year was disbursed during the following year. The nature of the funding 
stream--criminal fines and penalties imposed on federal offenders--
caused the level of available funding to vary significantly. For 
example, in some years, large fines against corporate offenders would 
cause a surge in deposits. However, in 1999, Congress chose to reserve 
a portion of the deposits from such years to offset lower collections 
in leaner years by placing a cap on the amount of disbursements from 
the Fund. The appropriations conference report noted that ``the 
conferees have taken this action . . . to ensure that a stable level of 
funding will remain available for these programs in future years.'' \1\ 
Therefore, as a result of this decision, a variable sum of money--
called the ``rainy day fund''--is routinely carried over from one 
fiscal year into the next.
---------------------------------------------------------------------------
    \1\ H.R. Rep. No. 106-479, at 239 (1999) (Conf. Rep.).
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Reject the Proposed Cancellation and Protect the VOCA Fund Balance
    For the past two fiscal years, the Administration unsuccessfully 
sought to rescind the balance of the VOCA Fund, withdrawing the money 
from the ``rainy day fund'' and leaving the Fund with a zero balance. 
The Administration's 2008 fiscal year budget request now seeks an 
outright cancellation of the Fund, resulting in the transfer of the 
current balance of the Fund to the General Treasury. Annual tax dollars 
would be used to fund the $625 million VOCA cap, to be offset by 
federal fines collected over the course of the year. Additionally, the 
proposal would take $50 million from under the $625 million cap to be 
designated for the emergency reserve, effectively lowering the amount 
available to states.
    Due to the Fund's allocation formulas, the impact of fluctuations 
falls most heavily on victim assistance grants. A cancellation of the 
VOCA Fund would eliminate the dedicated funding stream that has enabled 
steady support for crime victim services. Each year, victim advocates 
would have to lobby for funding, competing against each other and every 
other federal budget item. Moreover, the proposed cancellation and 
system shift would undermine the Fund's principal philosophy of 
offender accountability as originally proposed by President Reagan's 
1982 President's Task Force on Victims of Crime. As Reagan 
Administration Attorney General Ed Meese testified before a Senate 
subcommittee last year, such a profound change ``would be a perversion 
of the original concept of the Crime Victims Fund and would violate its 
integrity.'' \2\
---------------------------------------------------------------------------
    \2\ Crime Victims Fund Rescission: Real Savings or Budget Gimmick?: 
Hearing Before the Subcomm. on Fed. Financial Mgmt., Gov't Info., and 
Int'l Security of the S. Comm. on Homeland Security and Governmental 
Affairs, 109th Cong. (2006) (statement of Ed Meese, Att'y Gen., Ronald 
Reagan Distinguished Fellow in Pub. Pol'y and Chairman of the Ctr. for 
Legal and Judicial Studies, The Heritage Foundation).
---------------------------------------------------------------------------
Fiscal Year 2008 VOCA Funding Should Be Raised by $375 Million; States 
        Should Have Six Years to Spend This Money
    Approximately 4,400 agencies rely on continued VOCA funding to 
serve 3.8 million crime victims a year. \3\ Even so, the recent 
increase in crime across the country has meant a heightened demand for 
victim services. Moreover, victim service programs report an urgent 
need to expand their outreach and service components in order to reach 
all victim populations. Without increased VOCA funding, programs in all 
fifty states and six additional jurisdictions will be unable to 
adequately address the needs of their communities and may have to lay 
off staff and limit, or even suspend, programs.
---------------------------------------------------------------------------
    \3\ See Office for Victims of Crime, U.S. Dept. of Justice, Victims 
of Crime Act: 2005 Victim Assistance Grant Program Nationwide 
Performance Report (2005); full text available at: http://www.ovc.gov/
fund/vocanpr_va05.html (accessed on April 11, 2007).
---------------------------------------------------------------------------
    One of the most underserved populations of crime victims is victims 
with disabilities. Victims with mental or physical disabilities are 
frequently targets for criminals, and face increased barriers in 
seeking services. For example, studies have shown that almost two-
thirds of women with disabilities report abuse and violence; 
additionally, in domestic violence situations, these women reported 
staying with their batterers almost twice as long as women without 
disabilities.\4\ However, only 35 percent of shelters recently surveyed 
have disability awareness training for their staff and only 16 percent 
have a dedicated staff person to deliver services to women with 
disabilities.\5\ Without the proper training, shelters and victim 
services programs cannot expect to adequately respond to the needs of 
victims with disabilities.
---------------------------------------------------------------------------
    \4\ M.E. Young et al., Prevalence of Abuse of Women with Physical 
Disabilities, 78 Arch. Phys. Med. & Rehabil., Special Issue (1997).
    \5\ Margaret A. Nosek, Ph.D., et al, Baylor College of Medicine, 
Violence Against Women With Disabilities--Fact Sheet #1: Findings From 
Studies 1992-2002.
---------------------------------------------------------------------------
    Similarly, dating and sexual violence is frighteningly prevalent in 
the youth population, yet there is a serious dearth of appropriate 
services and resources geared toward helping this underserved age 
group. One in three teens knows a friend or peer who has been hit, 
punched, kicked, slapped, choked, or physically hurt by a dating 
partner.\6\ Approximately 25 percent of high school girls have been the 
victims of physical abuse, sexual abuse, or date rape.\7\ 
Understandably, many service providers express a strong desire to 
expand their services to better serve teen victims of crime; however, 
they lack the funding for the staff, training, and outreach programs 
that would make this feasible.\8\
---------------------------------------------------------------------------
    \6\ See Liz Claiborne Inc., Omnibuzz Topline Findings: Teen 
Relationship Abuse Research (Feb. 2005).
    \7\ See Cathy Schoen et al., The Commonwealth Fund, the 
Commonwealth Fund Survey of the Health of Adolescent Girls (Nov. 1997).
    \8\ See National Center for Victims of Crime, Results From the 
National Center's 2006-2007 Public Policy Poll (a compilation of the 
National Center's member responses to a survey regarding legislative 
priorities, underserved victims in communities, coming legislative 
sessions, and requests for general feedback); available at: http://
www.ncvc.org/ncvc/AGP.Net/Components/documentViewer/
Download.aspxnz?DocumentID=41511 (accessed on April 13, 2007).
---------------------------------------------------------------------------
    Service providers also recognize that there are significant 
populations of immigrant victims of crime who do not have access to 
services. These victims are often culturally and linguistically 
isolated from the general society, making them vulnerable to crime but 
also unaware of the services that can help them. Victim service 
providers know that to make inroads in reaching these populations, they 
must make an investment in personnel and in the time needed to build 
trust with existing community members. Without additional funding, such 
critical expansions in services, outreach, and programs are not 
possible.
    There are many other underserved populations of victims across the 
country. In a recent National Center poll of our members, service 
providers indicated a need to reach and serve homeless victims, victims 
with mental illness, racial or ethnic minority victims, and victims who 
are members of the GLBTQ population.\9\ Respondents also mentioned that 
indigent or poor victims, incarcerated victims, and Native American 
victims remain underserved and at risk for greater victimization.
---------------------------------------------------------------------------
    \9\ Id.
---------------------------------------------------------------------------
    A one-time increase in VOCA funds, coupled with an extension of 
time for states to use that extra funding, would allow the development 
of services targeted at these vulnerable and underserved victim 
populations. Such an investment of funding would enable victim service 
providers to form partnerships with agencies already connected to and 
trusted by those communities.
    Raising the cap on VOCA Fund distributions by $375 million for the 
2008 fiscal year would allow a comfortable Fund balance of 
approximately $300 million to remain for future years to help guarantee 
reliable funding for victim services programs. Moreover, it would 
ensure that the money collected from offenders was actually used for 
the purpose for which it was originally designed and authorized by law. 
Finally, allowing six instead of four years to spend VOCA grant money 
would provide states with the flexibility necessary to address the 
specific assistance needs of their communities.
Conclusion
    In closing, we urge Congress to reject the Administration's 
proposed cancellation and to affirm the vital importance of protecting 
the VOCA Fund for years to come. Raising the VOCA Fund cap for the 2008 
fiscal year by $375 million and extending the time states have to spend 
the money to six years will permit states to reach additional victims 
while ensuring the future stability of the Fund.
                                 ______
                                 
 Prepared Statement of the American Indian Higher Education Consortium
    This statement focuses on two areas: National Aeronautics and Space 
Administration (NASA) and National Science Foundation (NSF).
    Mr. Chairman and Members of the Subcommittee, on behalf of the 
nation's 34 American Indian Tribal Colleges and Universities (TCUs), 
which comprise the American Indian Higher Education Consortium (AIHEC), 
thank you for the opportunity to express our views and recommendations 
for fiscal year 2008 on programs that directly affect our institutions.
                       summary of recommendations
    National Aeronautics and Space Administration (NASA).--In fiscal 
year 2001, tribal colleges established a formal cooperative agreement 
with NASA for a project designed to increase access, participation, and 
success of American Indians in high quality K-16 science, technology, 
engineering, and mathematics (STEM) programs. The agreement includes a 
modest program to support TCU STEM education and research programs, as 
well as a summer research opportunities program for TCU faculty and 
students to participate in NASA research projects at the various NASA 
centers around the country. This program and other minority-serving 
programs have demonstrated success in improving STEM education and 
research programs at TCUs and encouraging more American Indians and 
other minorities to pursue degrees and careers in the hard sciences. 
However, NASA recently reorganized its funding priorities resulting in 
severe cuts in education programs overall and the near elimination of 
this modest TCU program. We are requesting that no less than $2.5 
million of the NASA budget be made available to continue to support TCU 
STEM research and education programs.
  --Strengthen NASA's Role in Developing the American STEM Workforce.--
        The ability of NASA to help develop and train the American STEM 
        workforce has been severely undercut by NASA's current budget 
        policy. In general, we urge the Subcommittee to ensure that 
        funding for NASA education programs, particularly, those 
        targeting minority serving institutions, is restored to levels 
        necessary for a meaningful impact on the ability of Tribal 
        College and Universities and other MSIs to prepare their 
        students to enter the national science, technology, engineering 
        and mathematics workforce. We further urge the Subcommittee to 
        examine and address the disproportionate impact that NASA's 
        current budget priorities have on minority serving institutions 
        and minority students, which represent America's best hope for 
        securing a well trained STEM workforce in the future.
  --National Science Foundation (NSF): Tribal Colleges and Universities 
        Program (TCUP).--Over the past seven years, this program has 
        provided vital assistance to TCUs as they build their capacity 
        to provide strong science, technology, engineering, and 
        mathematics (STEM) teaching and learning programs for American 
        Indians. Since its inception, 29 of the 31 eligible TCUs have 
        participated in this program, along with six Alaska Native and 
        Native Hawaiian serving institutions. While the impact of the 
        TCUP program on Tribal Colleges and Alaska Native and Native 
        Hawaiian institutions has been significant, the program funding 
        level has not grown above the initial $10 million/year, and can 
        no longer sufficiently address the needs of eligible 
        institutions. We request that the Subcommittee increase the 
        amount of funding for the NSF-TCU program by $5 million, for a 
        total of $15 million.
  --TCU STEM Blue Ribbon Panel.--We request that funding be 
        appropriated to establish and support a Blue Ribbon Panel 
        comprised of national leaders in scientific research and 
        education, to be organized and convened by the National 
        Academies to (1) monitor and review developments and changing 
        policy issues related to STEM research and education at the 
        nation's Tribal Colleges and Universities; (2) examine and 
        evaluate the current state of Federal program opportunities 
        available to TCUs for developing and sustaining STEM education 
        and research programs; and (3) prepare a report recommending 
        strategies at all levels for improving STEM education and 
        research programs at TCUs. Sources of information that will be 
        reviewed by the Blue Ribbon Panel will include public symposia 
        organized by the Panel, published documents, and written 
        comments by members of the scientific research and education 
        community, and examination of past and current STEM education 
        and research programs at, and technical assistance programs 
        for, Tribal Colleges and Universities. We request that the 
        Subcommittee appropriate $500,000 for the purpose of 
        establishing this TCU STEM Blue Ribbon Panel.
                             justifications
    In 2007, the report ``Rising above the Gathering Storm--Energizing 
and Employing America for a Brighter Economic Future'' (National 
Academies Press (NAP) 2007) prepared by the Committee on Science, 
Engineering, and Public Policy, warns that America's place as the 
world's leader in science and technology is at risk. The report lists 
the growing need for a competitive and qualified workforce and 
government investment in national research and development as two 
essential ingredients of a formula for maintaining America's continued 
leadership in science and technology. This request addresses the role 
of Tribal Colleges and Universities specifically and minority serving 
institutions generally in these two critical areas.
    America's minority serving institutions--Tribal Colleges and 
Universities, Historically Black Colleges and Universities (HBCUs), and 
Hispanic Serving Institutions (HSIs)--are a primary provider of higher 
education programming for their respective populations. Although only a 
relative small percentage of colleges and universities in the country, 
MSIs serve a much greater proportion of underrepresented minority 
students, for example, HSIs are only about 6 percent of the higher 
education institutions in the country, but produce 33 percent of 
Hispanic science baccalaureates. HBCUs produce the same percentage for 
African Americans (National Science Board, 2004). Studies have shown 
the reservation-based American Indians attending mainstream 
institutions of higher education have a failure rate of 70-80 percent. 
However, these same students have a success rate of 70-80 percent at 
TCUs. Despite these successes, Native Americans, African Americans and 
Hispanics continue to be seriously underrepresented in the sciences 
even as their numbers and proportion in higher education grow (National 
Science Board (NSB), 2004). Supporting MSIs is critical for reaching 
the growing number of underrepresented minority college students, the 
next generation of scientists and engineers.
National Aeronautics and Space Administration (NASA)
    The NASA AIHEC Cooperative Agreement has served 27 Tribal Colleges 
and Universities with support for faculty and student research at NASA 
Centers, STEM course and curriculum development, research 
instrumentation, research projects, professional development for STEM 
faculty, and information infrastructure improvements supporting the 
delivery of high quality STEM education and research programs. These 
NASA-supported activities have impacted nearly 700 K-12 students and 
teachers, 2,700 Tribal College and University students, and over 150 
faculty members, significantly furthering TCU efforts at recruitment 
and retention of American Indian students, and their preparation for 
careers in science, engineering, and technology fields.
    In 2007, NASA support for Tribal Colleges and Universities under 
the NASA-AIHEC Cooperative Agreement was reduced from $1.2 million to 
approximately $400,000. This reduction has necessitated a significant 
re-scoping of the activities supported under the Cooperative Agreement, 
and thereby has significantly reduced resources available to positively 
affect the educational experience of American Indian students. In 
addition, over the past two years, other vital TCU STEM programs funded 
by NASA were eliminated entirely due to budget restructuring. For 
example, a program to train TCU faculty at multiple campuses in 
geospatial technologies, and another STEM education program involving a 
TCU partnership with other key institutions of higher education were 
both eliminated entirely. The funding for these and other programs must 
be restored to a level at which a significant impact on the TCU 
educational community can be realized.
National Science Foundation Programs
    Since 2001, NSF's Tribal Colleges and Universities Program has been 
a primary resource for Tribal Colleges and Universities and Alaska 
Native/Native Hawaiian institutions to plan and develop STEM education 
and research programs designed to respond to local and regional STEM 
workforce challenges and opportunities. To date, 29 of the 31 eligible 
TCUs have participated in the program, along with 6 Alaska Native and 
Native Hawaiian serving institutions. Participating colleges and 
universities have enhanced existing degree programs and developed 
entirely new program offerings. Funded institutions have upgraded their 
laboratory facilities, hired instructors, and introduced innovative 
strategies to recruit and retain students. While these TCUP-funded 
activities have had a significant impact on college STEM programs and 
on the students who have enrolled in them, this initiative is still too 
modest in scope to ensure that these activities can be sustained by all 
TCUP-eligible institutions for a period necessary to realize 
significant outcomes in terms of student success in STEM, particularly 
at the baccalaureate and graduate education levels. Additional funding 
is necessary to ensure that all TCUP-eligible institutions are able to 
receive sustained funding necessary to continually develop and improve 
their STEM program offerings in response to changing local and regional 
STEM workforce demands and research opportunities.
    In addition to the TCUP program, a number of other programs for 
which Tribal Colleges and Universities compete within the Education and 
Human Resources Directorate have experienced reductions. Overall, there 
has been a 19 percent cut in inflation adjusted dollars for NSF's 
Education and Human Resources budget since 2004. This is particularly 
difficult to understand given the severe challenges facing the nation 
in preparing the nation's science, technology, engineering, and 
mathematics workforce documented in the above-referenced report 
``Rising above the Gathering Storm''. The TCUP program should be 
expanded by at least $5 million annually for a total of $15 million to 
allow TCUP-eligible institutions to fully implement STEM education and 
research improvement plans that are responsive to local and national 
STEM workforce development needs, particularly given the shortfall in 
funding for other Education and Human Resources programs.
    Further, based on a motion of the AIHEC Board of Directors, which 
is comprised solely of TCU presidents, we recommend that a policy be 
put in place that stating that any grants or contracts for technical 
assistance under any NSF-TCU program shall be awarded to an Indian 
organization which: (a) the NSF Director finds is nationally based, (b) 
represents a substantial American Indian constituency, and (c) has 
expertise in the field of Tribal Colleges and Universities and American 
Indian higher education. This will help ensure that the unique needs of 
the TCUs, their students and faculties are addressed effectively and 
efficiently in a productive and responsive manner.
    Finally, given the limited pool of applicants and the tremendous 
need to sustain STEM programs for a length of time deemed sufficient to 
achieve improvement at all levels, we urge the subcommittee to direct 
NSF to:
  --Award grants under the NSF-TCU program for a period of five years, 
        with ongoing support for an additional five years (without the 
        need to re-enter a program competition), provided the programs 
        meet appropriate NSF criteria for satisfactory progress; and
  --Refrain from expanding funding priorities under the NSF-TCU program 
        into new areas (e.g. K-12 teacher education, which previously 
        had been supported by NSF under the Urban and Rural Systemic 
        Initiatives) until sufficient funding exists to meet the basic 
        STEM needs of TCUs and reliable data demonstrates a significant 
        improvement in basic STEM education participation and 
        completion rates across TCUs.
    We recognize that a tremendous need exists to address STEM 
education at all levels. However, funding is severely limited under the 
NSF-TCU program and it has not grown in seven years. Therefore, should 
NSF personnel believe additional areas should be addressed or 
additional programs established, beyond those proposed by TCUs under 
the general NSF-TCU program, then new funding should be requested or 
designated, rather than taking funds appropriated for desperately 
needed basic STEM/Technology education and research programs. This is 
particularly important when the new funding priorities imposed on 
grantees under programs such as NSF-TCUP are simply replacing programs 
that have been eliminated elsewhere within NSF.
TCU STEM Blue Ribbon Panel
    An independent Blue Ribbon Panel on TCU STEM would be empowered to 
examine, evaluate, and make recommendations regarding the design and 
delivery of STEM programs at the Tribal Colleges and Universities, as 
well as research and education funding programs operated by the federal 
agencies. Recommendations provided by such a Panel would provide 
significant impetus in moving Tribal Colleges and University programs 
toward greater effectiveness while ensuring greater accountability. The 
National Academies are the primary source of expert guidance in 
science, engineering, and medicine to academia, industry, the U.S. 
Government, and the general public and as such is the appropriate 
organization to convene and conduct activities within the intended 
scope of this request.
                               conclusion
    In light of the justifications presented in this statement, we 
respectfully request that Congress appropriate funding for NASA and NSF 
programs that directly impact the STEM programs at Tribal College and 
Universities at the levels recommended. This relatively small 
investment will go a long way toward helping to build the nation's STEM 
workforce while fostering economic self-sufficiency in Indian Country. 
Fulfillment of AIHEC's fiscal year 2008 recommendations will strengthen 
the missions of all of the TCUs and significantly enhance the strong 
positive impact that they have on their respective communities. We 
respectfully request your continued support of TCUs and full 
consideration of our fiscal year 2008 appropriations recommendations.
                                 ______
                                 
 Prepared Statement of the California Industry and Government Central 
                California Ozone Study (CCOS) Coalition
    Madam Chairman and Members of the Subcommittee: On behalf of the 
California Industry and Government Central California Ozone Study 
(CCOS) Coalition, we are pleased to submit this statement for the 
record in support of our fiscal year 2008 funding request of $150,000 
from the Department of Commerce/NOAA account for CCOS. These funds are 
necessary for the State of California to address the very significant 
challenges it faces to comply with new national ambient air quality 
standards for ozone and fine particulate matter. The study design 
incorporates technical recommendations from the National Academy of 
Sciences (NAS) on how to most effectively comply with federal Clean Air 
Act requirements.
    First, we want to thank you for your past assistance in obtaining 
federal funding for the Central California Ozone Study (CCOS) and 
California Regional PM10/PM2.5 Air Quality Study 
(CRPAQS). Your support of these studies has been instrumental in 
improving the scientific understanding of the nature and cause of ozone 
and particulate matter air pollution in Central California and the 
nation. Information gained from these two studies is forming the basis 
for the 8-hour ozone, PM2.5, and regional haze State 
Implementation Plans (SIPs) that are due in 2007 (ozone) and 2008 
(particulate matter/haze). As with California's previous and current 
SIPs, all future SIPs will continue to be updated and refined due to 
the scientific complexity of our air pollution problem. Our request 
this year would fund the completion of CCOS to address important 
questions that won't be answered with results from previously funded 
research projects.
    To date, our understanding of air pollution and the technical basis 
for SIPs has largely been founded on pollutant-specific studies, like 
CCOS. These studies are conducted over a single season or single year 
and have relied on modeling and analysis of selected days with high 
concentrations. SIPs are now more complex than they were in the past. 
The National Academy of Sciences (NAS) now recommends a weight-of-
evidence approach that will involve utilizing more broad-based, 
integrated methods, such as data analysis in combination with seasonal 
and annual photochemical modeling, to assess compliance with federal 
Clean Air Act requirements. This will involve the analysis of a larger 
number of days and possibly an entire season. In addition, because 
ozone and particulate matter are formed from some of the same emissions 
precursors, there is a need to address both pollutants in combination, 
which CCOS will do.
    Consistent with the NAS recommendations, the CCOS study includes 
corroborative analyses with the extensive data provided by past 
studies, advances the state-of-science in air quality modeling, and 
addresses the integration of ozone and particulate pollution studies. 
In addition, the study will incorporate further refinements to emission 
inventories, address the development of observation-based analyses with 
sound theoretical bases, and includes the following four general 
components:

------------------------------------------------------------------------
                                                                 Year
------------------------------------------------------------------------
Performing SIP modeling analyses...........................    2005-2011
Conducting weight-of-evidence data analyses................    2006-2008
Making emission inventory improvements.....................    2006-2010
Performing seasonal and annual modeling....................    2008-2011
------------------------------------------------------------------------

    CCOS is directed by Policy and Technical Committees consisting of 
representatives from Federal, State, and local governments, as well as 
private industry. These committees, which managed the San Joaquin 
Valley Ozone Study and are currently managing the California Regional 
PM10/PM2.5 Air Quality Study, are landmark 
examples of collaborative environmental management. The proven methods 
and established teamwork provide a solid foundation for CCOS.
    For fiscal year 2008, our Coalition is seeking funding of $150,000 
from the Department of Commerce/NOAA account in support of CCOS. 
California has a very complex terrain that includes mountain ranges, 
flat valleys, and long coastal regions. Some meteorological models are 
known to have difficulty in simulating high-resolution airflow over 
such complex terrain. NOAA has a vast amount of experience in applying 
meteorological models in several different areas of the country and 
their scientific know-how is a valuable asset to CCOS. This request 
will be used to continue NOAA's involvement in developing 
meteorological simulations for Central California, specifically longer-
term simulations of seasonal and annual meteorology. The long-term 
record of meteorological data in the CCOS database can be used to 
improve NOAA's meteorological forecasting abilities and in the 
evaluation of U.S. western boundary conditions for weather forecasting 
models.
    As you know, NOAA is at the scientific forefront of the development 
of meteorological models including the Weather Research and Forecasting 
(WRF) model that is viewed as a replacement for the Mesoscale 
Meteorology Model, Version 5 (MM5). Thus, NOAA's involvement would 
facilitate the use of CCOS measurements in the development and 
refinement of WRF. In addition, NOAA has conducted prior research in 
the CCOS region on atmospheric airflows, sea breeze circulation 
patterns, nocturnal jets and eddies, airflow bifurcation, convergence 
and divergence zones, up-slope and down-slope flows, and up-valley and 
down-valley airflow. Thus, CCOS provides the opportunity to draw from 
or extend this research for a longer, multi-year time period. This 
research provides fundamental data needed to understand airflow over 
complex terrain, and has national applicability.
    If we receive the funds requested this year to complete this 
research project, this will be our final request.
    Thank you very much for your consideration of our request.
                        cooperative partnership
Private Sector
    Western States Petroleum Association; Pacific Gas and Electric 
Company; Electric Power Research Institute; NISEI Farmers League and 
Agriculture; Independent Oil Producers' Agency; and California Cotton 
Ginners and Growers Associations.
Local Government
    San Joaquin Valley Unified Air Pollution Control District (on 
behalf of local cities and counties); Bay Area Air Quality Management 
District; Sacramento Metro Air Quality Management District; San Luis 
Obispo County Air Pollution Control District; Mendocino County Air 
Pollution Control District; and Yolo-Solano Air Quality Management 
District.
State Government
    California Air Resources Board; and California Energy Commission.
Federal Government
    Environmental Protection Agency; Department of Agriculture; 
Department of Commerce; National Oceanic and Atmospheric 
Administration; Department of Transportation; Department of Interior; 
and Department of Energy.
                                 ______
                                 
    Prepared Statement of the Marine Conservation Biology Institute
    On behalf of the Marine Conservation Biology Institute (MCBI), I 
thank the members of the Commerce, Justice, Science, and Related 
Agencies Appropriations Subcommittee for the opportunity to submit 
written testimony on fiscal year 2008 appropriations for NOAA. MCBI is 
a national, nonprofit environmental organization interested in 
advancing the science of marine conservation biology and securing 
protection for ocean ecosystems. Our headquarters are in Bellevue, 
Washington and we also have offices in California and Washington, DC.
    MCBI is a member of the Friends of NOAA Coalition and supports the 
Coalition's recommendation for funding NOAA at $4.5 billion in fiscal 
year 2008, the same amount recommended by the Senate for fiscal year 
2006 and 2007, and the same amount currently being recommended by the 
House Oceans Caucus. In addition, we support funding augmentation for 
several important conservation programs and activities as follows: $3.2 
million for the Marine Protected Areas Initiative; $14.5 million for 
the National Undersea Research Program; $78 million for the National 
Marine Sanctuaries Program; and $7.7 million for conservation of the 
Hawaiian monk seal. Our justifications for these requests are as 
follows:
    National Marine Protected Areas Center (MPA Center) is responsible 
for the implementation of Executive Order 13158, ``Marine Protected 
Areas'' (MPAs), which President Clinton issued in May 2000. The 
objective of the executive order is to protect ``significant natural 
and cultural resources within the marine environment for present and 
future generations by strengthening and expanding the Nation's system 
of marine protected areas.'' (Exec. Order No. 13158, 65 Fed. Reg. 
34,909 (2000)). Federal agencies are directed to use their existing 
legal authorities to develop an effective national system of marine 
protected areas, including expansion of existing protected areas and 
the creation of new ones. The MPA Center is housed within NOAA's 
National Ocean Service (Office of Ocean and Coastal Resource 
Management).
    MPAs are designated to protect marine ecosystems, processes, 
habitats, and species, and contribute to the restoration and 
replenishment of resources for social, economic, and cultural 
enrichment. The MPA Center's specific goals include designing a 
framework for a national system of MPAs, developing innovative 
approaches to understanding the ecosystem effects and human dimensions 
of MPA design and management, facilitating coordination among MPA 
agencies and stakeholders, and conducting outreach and education about 
place-based ocean management. Cuts in funding have greatly impacted the 
MPA Center's activities. The Center has lost 75 percent of its staff 
since 2005. This has severely impacted the Center's ability to 
implement the President's executive order, and to facilitate national, 
state and local MPA coordination.
    MCBI recommends $3.2 million for the MPA Center in fiscal year 
2008, enabling it to get back on track with its goals and work plans. 
In addition to allowing the Center to continue the work below, this 
funding would also allow the Center to rehire the seven staff that were 
lost under previous budgets. Funding at this level would enable the 
Center to:
  --Complete its Draft Framework for a national system of MPAs. Funding 
        at the fiscal year 2006 level could delay this project another 
        1-2 years.
  --Allow for more stakeholder and advisory committee participation. 
        Funding at the fiscal year 2006 level will only allow minimal 
        external consultation with stakeholders.
  --Continue and accelerate the West Coast Pilot Project. Funding at 
        fiscal year 2006 levels would delay critical components of this 
        important project another 3-4 years, and significantly limit 
        its ultimate utility to the region as a model for the rest of 
        the national system of MPAs. Completion of the Pilot Project 
        would be extremely helpful to the Governors of California, 
        Oregon, and Washington, who jointly seek to create an ocean and 
        coastal resource action plan for the Pacific Coast.
    National Undersea Research Program (NURP) is a key vehicle in 
implementing many of the priority topics identified by the U.S. 
Commission on Ocean Policy's Ocean Research Priority Plan. These topics 
include ``Stewardship of Natural and Cultural Resources,'' ``Improving 
Ecosystem Health,'' the ``Ocean's Role in Climate,'' and ``Increasing 
Resilience to Natural Hazards.'' Through its regional science centers, 
NURP provides scientists with the advanced underwater technologies 
needed to conduct important research, such as remotely operated and 
autonomous underwater vehicles, human occupied submersibles, advanced 
technical diving, and underwater laboratories. NURP is the nation's 
only federal scientific program that specializes in providing the 
undersea technology needed to help us better manage Earth's last 
frontier.
    NURP-sponsored research has contributed to improving methods for 
assessing fish populations, locating and mapping areas of deep sea 
corals, and assessing the impacts of overfishing, climate change, and 
water pollution. Additionally, NURP activities will be an integral part 
of the Deep Sea Coral Research and Technology Program at NOAA, newly 
authorized by the Magnuson-Stevens Fishery Conservation and Management 
Act in 2006.
    In fiscal year 2008 NURP and NOAA's Ocean Exploration (OE) Program 
will be merged into a new Office of Ocean Exploration and Research 
(OER). The office will support exploration, research, and advanced 
technology development efforts.
    Cuts in funding have greatly impacted NURP's activities. In fiscal 
year 2006, funding was cut by more than 60 percent of fiscal year 2005 
levels to $4.1 million. This reduced level of funding has continued in 
fiscal year 2007. MCBI recommends $14.5 million for NURP in fiscal year 
2008. This amount would enable NURP to:
  --Complete the second year of an east coast MPA site identification 
        project, organized by the NURP University of Connecticut 
        Center. This project, at the Stellwagen Bank National Marine 
        Sanctuary, aims to identify the full range of ecosystems and 
        habitats that should be protected in an MPA network.
  --Map deep sea coral habitat in the Gulf of Maine, providing valuable 
        information to marine resource managers. Funding at fiscal year 
        2006 levels would not support this project.
  --Continue a Lake Superior project examining the impacts of PCBs on 
        fish and human health.
  --Map and characterize the new deep sea coral Habitat Areas of 
        Particular Concern (HAPCs) and shelf edge MPAs off the 
        southeast U.S. coast.
  --Obtain vital climate records from west coast deep-water corals. 
        This project was approved for funding in fiscal year 2006 and 
        fiscal year 2007 but was deferred in both cases due to budget 
        cuts, and is at risk of cancellation.
  --Undertake an ecosystem connectivity cruise off the west coast and 
        Northwestern Hawaiian Islands. This project was originally 
        planned for fiscal year 2008 but has been delayed because 
        budget uncertainties.
    The National Marine Sanctuaries Act authorizes the Secretary of 
Commerce to designate and manage areas of the marine environment for 
resource protection. Currently, the National Marine Sanctuary Program 
(NMSP) is responsible for the management and oversight of 13 national 
marine sanctuaries comprising over 18,000 square miles, and for the 
Papahanaumokuakea Marine National Monument.
    The NMSP is responsible for education, research, monitoring and 
management programs. In order to successfully carry out its objective, 
each sanctuary develops, reviews, and implements a comprehensive 
management plan. Each site also carries out local research, monitoring 
programs, cultural programs, education and outreach programs, 
enforcement, and permitting. The NMSP headquarters offers oversight, 
guidance, and support to each sanctuary site. Recent NMSP 
accomplishments include the discovery of deep sea corals in the Olympic 
Coast National Marine Sanctuary, the documented increase of marine life 
in the Florida Keys Tortugas Ecological Reserve (part of the Florida 
Keys National Marine Sanctuary), and research that led to the 
International Maritime Organization approving a shift in the shipping 
lanes in the Stellwagen Bank National Marine Sanctuary region to reduce 
whale/ship strikes to protect endangered whales.
    For the last few years the NMSP has seen its budget fall from 
approximately $68 million (including ORF and PAC accounts) in fiscal 
year 2005 to approximately $55 million in fiscal year 2006. As of April 
13, 2007, the NMSP has received approximately $35 million of its fiscal 
year 2007 budget for ORF; the PAC numbers are still unknown. In fiscal 
year 2008, the President requested approximately $50 million for the 
NMSP. However, $8 million of the allocation is specifically for the 
Papahanaumokuakea Marine National Monument. As it stands now, the NMSP 
operations budget of approximately $36 million has been unchanged for 
three consecutive years.
    Increased funds are needed to ensure that the NMSP can continue to 
meet its growing responsibilities and keep up with inflation. 
Furthermore, the NMSP will be unable to meet the management benchmarks 
that must be met before the congressional moratorium imposed on new 
sanctuary designations can be lifted. MCBI recommends that the NMSP 
receive $78 million for fiscal year 2008. This amount would restore the 
NMSP's funding to the fiscal year 2005 enacted level of $68 million, 
plus another $10 million for construction and facilities. This amount 
includes the President's $8 million request for the management of the 
Papahanaumokuakea Monument. As it stands now, the NMSP operation budget 
has been roughly the same for three consecutive years.
    The Hawaiian monk seal is one of the most endangered marine mammals 
in the world and is the only marine mammal species whose entire range 
lies within the U.S. jurisdiction. Most Hawaiian monk seals reside in 
the Papahanaumokuakea Marine National Monument in the Northwestern 
Hawaiian Islands (NWHI). Over the last 50 years, the Hawaiian monk seal 
population has declined by more than 60 percent to an estimated 1,252 
individuals, its lowest level in recorded history. A number of human 
and environmental factors have contributed to this decline, including 
overfishing; environmental cycles; entanglement in marine debris; 
predation by sharks; injuries and deaths caused by aggressive adult 
male monk seals; habitat modification and loss; and disturbance by 
humans.
    The Hawaiian monk seal is currently spiraling into extinction. What 
happens next will be crucial to the monk seal's recovery prospects. The 
National Marine Fisheries Service (NMFS) and its partner agencies must 
aggressively budget for and carry out key recommendations of the draft 
recovery plan, which include the following:
  --Implement a suite of actions to improve female survival in the 6 
        main subpopulations, including: conservation of habitats and 
        prey base; research on juvenile survival factors; interventions 
        to protect juveniles, especially females, until they are strong 
        enough to care for themselves; and protection of females from 
        male seal aggression and shark predation.
  --Continued removal of hazardous debris from monk seal habitat.
  --Maintain and expand field efforts to carry out research and 
        management actions in the NWHI.
  --Develop and implement a coordinated plan with the state, local, and 
        non-governmental organizations to encourage growth of the monk 
        seal population in the Main Hawaiian Islands (MHI) and prevent 
        harmful human interactions with the seals that reside there; 
        and consider a best-site relocation program for seals in the 
        MHI to optimize their survival prospects.
  --Determine and take reasonable steps to reduce the probability of 
        exposure of monk seals to new diseases (e.g. distemper).
    Historically, Hawaiian monk seal recovery efforts have been funded 
primarily by NMFS and have focused heavily on scientific research. Much 
more attention now needs to be paid to hands-on interventions to save 
the seals from dying. For fiscal year 2008, MCBI recommends $7.7 
million for monk seal conservation under the following programs:
  --$3 million allocated to the monk seal in the Marine Mammal and Sea 
        Turtle ESA base, under the NMFS, Office of Protected Resources. 
        These funds would support direct intervention and research 
        activities.
  --$500,000 as part of the Marine Mammal Initiative (Cetaceans and 
        Monk Seals), under NMFS, Office of Protected Resources. These 
        funds support the annual summer field camp and monk seal 
        population assessment through the Marine Mammal Initiative. 
        NOAA staff and volunteers must be supported on the six main 
        seal islands over a five-month period to observe seals, collect 
        data, and undertake urgent conservation activities.
  --$3 million is needed for marine debris removal through the Coral 
        Reef Conservation Program line item and the National Marine 
        Sanctuaries Program under the National Ocean Service. These 
        funds would ensure debris removal from all islands in the 
        Papahanaumokuakea Marine National Monument and protect seals, 
        birds, and sea turtles from entanglement death.
  --$1.2 million is needed in for the Hawaiian Monk Seal Program line 
        item. These funds support salaries, benefits, and travel costs 
        for NMFS seal program staff. Additional staff is needed to 
        carry out the required level of conservation activities.
    In summary, MCBI respectfully requests that the subcommittee 
augment funding for the ecosystem and species protection programs 
mentioned above. Thank you for the opportunity to share our views on 
appropriations for NOAA.
                                 ______
                                 
      Prepared Statement of the National Corn Growers Association
    The National Corn Growers Association (NCGA) appreciates the 
opportunity to share with the subcommittee our appropriations 
priorities for fiscal year 2008. Specifically, our top priority in the 
fiscal year 2008 Science, State, Justice and Commerce appropriations 
bill is the National Science Foundation's (NSF) Plant Genome Research 
Initiative (Initiative).
    NCGA is a national organization founded in 1957 and represents more 
than 32,000 members in 48 states, 47 affiliated state organizations and 
more than 300,000 corn farmers who contribute to state checkoff 
programs for the purpose of creating new opportunities and markets for 
corn growers.
    NCGA's top priority in the fiscal year 2008 Science, State, Justice 
and Commerce appropriations bill is increased funding to $150 million 
for the National Science Foundation (NSF) Plant Genome Research 
Initiative (initiative). The initiative is supported by the Interagency 
Working Group on Plant Genomes under the auspices of the National 
Science and Technology Council within the Office of Science and 
Technology Policy.
    In 1997, NCGA spearheaded the effort on legislation that authorized 
major plant genome research, which resulted in the Plant Genome 
Research Initiative. Obtaining genome sequence information frequently 
leads to breakthroughs in the study of a particular organism. The goal 
of the initiative is to understand the structure and function of all 
plant genes at all levels from molecules to organisms and to ecosystems 
and indeed, the initiative has led to an unprecedented increase in our 
understanding of the genomics and genetics of plants. The initiative 
also changed the way research is conducted in plant biology and helped 
to attract a new generation of scientists to the plant sciences field 
at U.S. colleges and universities.
    Bringing agriculturally important plant species into the genomic 
age is an important goal. Initial major accomplishments included the 
completion of the model laboratory plant Arabidopsis and rice genome 
sequences. Completion on those genomes demonstrated that genomic 
sequence was the most comprehensive way toward gene discovery--a first 
step toward identifying the role of each gene. Building upon lessons 
learned sequencing smaller plant genomes, sequencing the corn genome 
became feasible. Arabidopsis, a member of the brassicaceae, or mustard, 
family, has a genome of 125 million base pairs. Rice's genome, has 430 
million base pairs. Sequencing the corn genome had been considered 
difficult because of its large size and complex genetic arrangement. 
The genome has 50,000 genes scattered among the haploid genome size of 
2.3 billion nucleotides--molecules that form DNA--that make up its 10 
chromosomes.
    In 2004, valuable corn research was made available through NCGA to 
research scientists working to understand the maize genome through the 
availability of sequencing data from Ceres, DuPont and Monsanto. This 
information, combined with the corn sequence data already in the public 
domain, significantly accelerated the identification of genes within 
the entire corn genome and was a precursor to the effect that the full 
corn sequence will have on the research community.
    In 2005, NSF, the United States Department of Agriculture (USDA) 
and the Department of Energy (DOE) awarded $32 million to sequence the 
corn genome. NSF selected a consortium of four research institutions to 
sequence the maize genome: The University of Arizona, Washington 
University in St. Louis, Iowa State University in Ames and Cold Spring 
Harbor Laboratory in Cold Spring Harbor, New York. The goal of the 
Maize Genome Sequencing Project is to unravel the complete DNA sequence 
of the maize plant and to determine the number of genes and their 
position on the chromosomes--the tiny bundles of DNA that form the 
storage units of genetic information. Corn is pushing the state of the 
art of genetic research to new levels as its genome has complexities 
beyond any plant sequenced to date. The highly repetitive regions of 
DNA, formerly considered ``junk'' DNA, are extremely prevalent in corn, 
and have been shown to have a significant impact on how the genetic 
engine of life truly works. These issues have posed significant 
challenges to researchers interested in crop improvement, plant 
molecular biology, or genome evolution. Using a physical map that 
covers about 95 percent of the maize genome map, scientists generate a 
draft sequence to reveal the locations of regulatory elements within 
stretches of so-called non-coding ``junk'' DNA. Focus of the project 
does center on gene-containing regions and are sequenced in detail. 
This sequencing strategy enables the consortium to sequence the corn 
genome at a fraction of the cost that was necessary to decipher the 
human genome, which is only slightly larger than the corn genome.
    Today, genomic research technology and techniques are ready to 
complete a high quality corn genome sequence. The result will be the 
complete sequence and structural understanding of the entire corn 
genome, annotated functional sequences, and their locations on corn's 
genetic and physical map. This genome will be the most complex 
eukaryotic genome to be sequenced to date, including the human genome. 
The corn genome sequence will, in turn, help in the eventual completion 
of other major crop genome sequences, as itself benefited from 
knowledge gained through the prior completion of other genome 
sequences. It will also hold clues to improve the growth and 
development of other related grass crops, such as wheat, sorghum, 
millet and barley. Importantly, access to all of this information is 
shared through GenBank, a public repository for genome-sequence data.
    With increased funding, we will be much closer to achieving the 
goal of this initiative--understanding the structure and function of 
all plant genes. The corn industry, including the academic research 
community, grain handlers, growers, and seed companies support the corn 
genome sequencing project. A complete corn genome sequence and the 
application of its information will provide a wide range of benefits. 
Industry, both public and private, will be able to expedite their 
breeding programs and increase their knowledge of corn's important 
agronomic traits. Corn growers will be able to plant varieties of corn 
that are better suited to market and environmental needs, such as pest 
resistant traits. Quality researchers will continue to be attracted to 
the field of plant genomics and genetics.
    Consumers will also benefit from more abundant and sustainable 
food, feed and fuel supplies. Corn is not only grown for food and feed, 
it is converted to a myriad of processed food products--literally 
thousands of products in the typical supermarket contain corn. 
Improvements aim at increasing yield and nutritional value and 
optimizing the properties crucial for grain products such as flour and 
pasta. The production of corn-based products with enhanced nutritional 
value that are safer and less allergenic will directly benefit 
consumers.
    Corn is also an important material for many industrial purposes and 
products including rubber, plastics, fuel and clothing. Corn is a model 
system for studying complex genomic structure, organization and 
function, and its high quality genetic map will serve as the foundation 
for studies that may lead to improved biomass and bioenergy resources 
from corn and related plant species.
    The request for the Directorate for Biological Sciences (BIO) is 
$633 million, and increase of $25.15 million, or 4.1 percent, over the 
fiscal year 2007 request of $607.85 million. The Directorate for 
Biological Sciences supports research, infrastructure, and education in 
the biological sciences at U.S. colleges, universities, non-profit 
research institutions, and other research and education organizations.
    BIO includes a subactivity request for Plant Genome Research (PGR) 
of $101.22 million, an amount that does not contemplate an increase 
from the fiscal year 2007 request and is a slight decrease from fiscal 
year 2006 actual spending. PGR subactivity was initiated in fiscal year 
1998, as part of the initiative. In general, 36 percent of the PGR 
portfolio is available for new research grants. The remaining 64 
percent is used primarily to fund continuing grants made in previous 
years, which includes corn genome sequencing. PGR supports corn genome 
sequencing jointly with USDA and DOE. The Administration's proposal 
would contribute the third and last increment in support of the 
interagency corn sequencing project that began in fiscal year 2005.
    PGR also supports the Arabidopsis 2010 project. This project in 
fiscal year 2007 and 2008 could receive up to $25 million per year. It 
is important to note that model systems research such as this project, 
has been traditionally supported through NSF's core budget and not PGR. 
This change may result in a reduction of resources available for 
economically significant plants, such as continued work on new projects 
involving the rice genome and future new project stemming from corn 
genome work, during flat budget cycles. The Arabidopsis 2010 project 
and the NSF's PGRP complement each other and provide a broad base of 
support for the plant biology research community. It is critical that 
both activities receive enough support to achieve their goals.
    Maintaining and improving upon the resources available for crop 
systems is now more important than ever, as agriculture tries to meet 
the demands of consumers worldwide by providing a safe and secure 
supply of resources for human and animal nutrition, fiber, bioenergy, 
and industrial feeds. Continued strong governmental support of basic 
agricultural research is essential to ensure that the innovation 
pipeline remains robust. NCGA requests that this subcommittee include 
in the fiscal year 2008 Science, State, Justice and Commerce 
appropriations bill an increase in funding to $150 million for the 
National Science Foundation Plant Genome Research Initiative.
    Thank you for the support and assistance you have provided to corn 
growers over the years. Please feel free to contact Lisa Kelley at 202-
628-7001 if you need any additional information.
                                 ______
                                 
    Prepared Statement of the Great Lakes Indian Fish and Wildlife 
                               Commission
    Agency Involved: Department of Justice
    Program Involved: COPS Tribal Resources Grant Program (TRGP)
Summary of GLIFWC's Fiscal Year 2008 Testimony
    GLIFWC requests that Congress: (1) continue funding the DOJ COPS 
Tribal Resources Grant Program at $31,065,000 in fiscal year 2008 (i.e. 
the same level as requested by the Administration in fiscal year 2007 
and appropriated by both the House and Senate), and (2) specifically 
authorize eligibility for tribes' special law enforcement agencies, 
including fish and wildlife departments and game wardens, to 
participate in the COPS Tribal Resources Grant Program.\1\
---------------------------------------------------------------------------
    \1\ Unlike previous years and without notice or explanation, the 
Fiscal Year 2006 Application Guide for the TRGP provides: Special law 
enforcement agencies such as fish and wildlife departments, game 
wardens, park and recreation departments, and environmental protection 
agencies are not eligible to apply under this program at this time. The 
status of GLIFWC's fiscal year 2007 TRGP eligibility is unknown at this 
time.



Ceded Territory Treaty Rights and GLIFWC's Role
    GLIFWC was established in 1984 as a ``tribal organization'' within 
the meaning of the Indian Self-Determination Act (Public Law 93-638). 
It exercises authority delegated by its member tribes to implement 
federal court orders and various interjurisdictional agreements related 
to their treaty rights. GLIFWC assists its member tribes in: securing 
and implementing treaty guaranteed rights to hunt, fish, and gather in 
Chippewa treaty ceded territories; and cooperatively managing and 
protecting ceded territory natural resources and their habitats.
    For the past 23 years, Congress and Administrations have funded 
GLIFWC through the BIA, Department of Justice and other agencies to 
meet specific federal obligations under: (a) a number of U.S./Chippewa 
treaties; (b) the federal trust responsibility; (c) the Indian Self-
Determination Act, the Clean Water Act, and other legislation; and (d) 
various court decisions, including a 1999 U.S. Supreme Court case, 
affirming the treaty rights of GLIFWC's member tribes. GLIFWC serves as 
a cost efficient agency to conserve natural resources, to effectively 
regulate harvests of natural resources shared among treaty signatory 
tribes, to develop cooperative partnerships with other government 
agencies, educational institutions, and non-governmental organizations, 
and to work with its member tribes to protect and conserve ceded 
territory natural resources.
    Under the direction of its member tribes, GLIFWC operates a ceded 
territory hunting, fishing, and gathering rights protection/
implementation program through its staff of biologists, scientists, 
technicians, conservation enforcement officers, and public information 
specialists.
Community-based Policing
    GLIFWC's officers carry out their duties through a community-based 
policing program. The underlying premise is that effective detection 
and deterrence of illegal activities, as well as education of the 
regulated constituents, are best accomplished if the officers live and 
work within tribal communities that they primarily serve. The officers 
are based in reservation communities of the following member tribes: In 
Wisconsin--Bad River, Lac Courte Oreilles, Lac du Flambeau, Red Cliff, 
Sokaogon Chippewa (Mole Lake) and St. Croix; in Minnesota--Mille Lacs; 
and in Michigan--Bay Mills, Keweenaw Bay and Lac Vieux Desert.
Interaction With Law Enforcement Agencies
    GLIFWC's officers are integral members of regional emergency 
services networks in Minnesota, Michigan and Wisconsin. They not only 
enforce the tribes' conservation codes, but are fully certified 
officers who work cooperatively with surrounding authorities when they 
detect violations of state or federal criminal and conservation laws. 
These partnerships evolved from the inter-governmental cooperation 
required to combat the violence experienced during the early 
implementation of treaty rights in Wisconsin. As time passed, GLIFWC's 
professional officers continued to provide a bridge between local law 
enforcement and many rural Indian communities. GLIFWC remains at this 
forefront, using DOJ funding to develop inter-jurisdictional legal 
training attended by GLIFWC officers, tribal police and conservation 
officers, tribal judges, tribal and county prosecutors, and state and 
federal agency law enforcement staff. DOJ funding has also enabled 
GLIFWC to certify its officers as medical emergency first responders 
trained in the use of defibrillators, and to train them in search and 
rescue, particularly in cold water rescue techniques. When a crime is 
in progress or emergencies occur, local, state, and federal law 
enforcement agencies look to GLIFWC's officers as part of the mutual 
assistance networks of the ceded territories. These networks include 
the Wisconsin Department of Natural Resources, Minnesota Department of 
Natural Resources, Michigan Department of Natural Resources, U.S. Coast 
Guard, USDA-Forest Service, State Patrol and Police, county sheriffs 
departments, municipal police forces, fire departments and emergency 
medical services.
GLIFWC Programs Funded by DOJ
    GLIFWC recognizes that adequate communications, training, and 
equipment are essential both for the safety of its officers and for the 
role that GLIFWC's officers play in the proper functioning of 
interjurisdictional emergency mutual assistance networks in the ceded 
territories. GLIFWC's COPS grants for the past six years have provided 
a critical foundation for achieving these goals. Significant 
accomplishments with Tribal Resources Grant Program funds include:
    Improved Radio Communications and Increased Officer Safety.--GLIFWC 
replaced obsolete radio equipment to improve the capacity of officers 
to provide emergency services throughout the Chippewa ceded 
territories. GLIFWC also used COPS funding to provide each officer a 
bullet-proof vest, night vision equipment, and in-car video cameras to 
increase officer safety.
    Emergency Response Equipment and Training.--Each GLIFWC officer has 
completed and maintains certification as a First Responder and in the 
use of life saving portable defibrillators. Since 2003, GLIFWC officers 
carried First Responder kits and portable defibrillators during their 
patrol of 275,257 miles throughout the ceded territories. In remote, 
rural areas the ability of GLIFWC officers to respond to emergencies 
provides critical support of mutual aid agreements with federal, state, 
and local law enforcement agencies.
    Ice Rescue Capabilities.--Each GLIFWC officer maintains 
certification in ice rescue techniques and was provided a Coast Guard 
approved ice rescue suit. In addition, each of patrol areas was 
provided a snowmobile and an ice rescue sled to participate in 
interagency ice rescue operations with county sheriffs departments and 
local fire departments.
    Wilderness Search and Rescue Capabilities.--Each GLIFWC officer 
completed Wilderness Search and Rescue training. The COPS Tribal 
Resources Grant Program also enabled GLIFWC to replace a number of 
vehicles that were purchased over a decade ago, including 10 ATV's and 
16 patrol boats and the GPS navigation system on its 31 foot Lake 
Superior Patrol Boat. These vehicles are used for field patrol, 
cooperative law enforcement activities, and emergency response in the 
1837 and 1842 ceded territories. GLIFWC officers also utilize these 
vehicles for boater, ATV, and snowmobile safety classes taught on 
Reservations as part of the Commission's Community Policing Strategy.
    Hire, Train and Equip Three Additional Officers.--Funding has been 
contracted to provide three additional officers to ensure tribes are 
able to meet obligations to both enforce off-reservation conservation 
codes and effectively participate in the myriad of mutual assistance 
networks located throughout a vast region covering 60,000 square miles.
    Consistent with numerous other federal court rulings on the 
Chippewa treaties, the United States Supreme Court re-affirmed the 
existence of the Chippewa's treaty-guaranteed usufructuary rights in 
Minnesota v. Mille Lacs Band, 526 U.S. 172 (1999). As tribes have re-
affirmed rights to harvest resources in the 1837 ceded territory of 
Minnesota, workloads have increased. But for GLIFWC's COPS grants, this 
expanded workload, combined with staff shortages would have limited 
GLIFWC's effective participation in regional emergency services 
networks in Minnesota, Michigan and Wisconsin. The effectiveness of 
these mutual assistance networks is more critical than ever given: (1) 
national homeland security concerns, (2) state and local governmental 
fiscal shortfalls, (3) staffing shortages experienced by local police, 
fire, and ambulance departments due to the call up of National Guard 
and military reserve units, and (4) the need to cooperatively combat 
the spread of methamphetamine production in rural areas patrolled by 
GLIFWC conservation officers.
    Examples of the types of assistance provided by GLIFWC officers are 
provided below:
  --as trained first responders, GLIFWC officers routinely respond to, 
        and often are the first to arrive at, snowmobile accidents, 
        heart attacks, hunting accidents, and automobile accidents 
        (throughout the ceded territories) and provide sheriffs 
        departments valuable assistance with natural disasters (e.g. 
        floods in Ashland County and a tornado in Siren, Wisconsin).
  --search and rescue for lost hunters, fishermen, hikers, children, 
        and the elderly (Sawyer, Ashland, Bayfield, Burnett, and Forest 
        Counties in Wisconsin and Baraga, Chippewa, and Gogebic 
        Counties in Michigan).
  --being among the first to arrive on the scene where officers from 
        other agencies have been shot (Bayfield, Burnett, and Polk 
        Counties in Wisconsin) and responding to weapons incidents 
        (Ashland, Bayfield, Burnett, Sawyer, and Vilas Counties in 
        Wisconsin).
  --use of a thermal imaging camera (purchased through the COPS 
        program) to track an individual fleeing the scene of an 
        accident (Sawyer County, Wisconsin).
  --organize and participate in search and rescues of ice fishermen on 
        Lake Superior (Ashland and Bayfield Counties in Wisconsin), 
        Lake Superior boats (Baraga County in Michigan and with the 
        U.S. Coast Guard in other parts of western Lake Superior), and 
        kayakers (Bayfield County in Wisconsin).
    GLIFWC is proposing to utilize DOJ TRGP funding for training and 
equipment to: (1) recognize, secure and respond appropriately to 
potential methamphetamine production sites, (2) identify addicts while 
on patrol, and (3) improve community awareness through hunter safety 
classes. Simply put, supporting GLIFWC's officers will not only assist 
GLIFWC in meeting its obligations to enforce tribal off-reservation 
codes, but it will enhance intergovernmental efforts to protect public 
safety and welfare throughout the region in the states of Wisconsin, 
Minnesota, and Michigan. The COPS Tribal Resources Grant Program 
provides essential funding for equipment and training to support 
GLIFWC's cooperative conservation, law enforcement, and emergency 
response activities. We ask Congress to support increased funding for 
this program.

              [From Outdoor Life Magazine, December 2006]

                       Meth Wars in Deer Country
    As its cost in dollars and lives mounts, the fight against 
methamphetamine now involves sportsmen to a degree no one predicted a 
handful of years ago. Across the rural countryside, meth labs have 
invaded the lands where we fish and hunt.
    One December evening in 2004, Wildlife Officer Amy Snyder heard 
shots after legal shooting hours in a popular duck-hunting area in 
Madison County, Tenn. She put on hip boots and set out into the marsh. 
But when she arrived at the blind where she thought the shooting had 
occurred, she found it unoccupied.
    Then Officer Snyder noticed a chemical odor in the air. She shined 
her light around and in the grass saw a large glass mason jar filled 
with what looked like corn hominy. She kicked over the jar, saw rubber 
hoses coming out of the top and panicked.
    ``It was a meth lab, actively cooking,'' Snyder recalls. ``What I'd 
done was extremely dangerous. The stuff could have exploded, not to 
mention what might have happened if I'd surprised the cookers at 
work.''
    Snyder had reason to be unnerved. The February before in Greene 
County, Ind., Conservation Officer Mike Gregg got a report of 
suspicious activity deep inside the Hillenbrand Fish and Wildlife Area. 
Gregg went in alone to investigate on a cold winter day and caught the 
unmistakable acrid tang of anhydrous ammonia, a liquid fertilizer and 
key component in the manufacture of methamphetamine. He got closer and, 
to his surprise, noticed a man trying to hide beneath the root ball of 
a fallen tree.
    ``He took off and I chased him through the snow,'' Gregg says. 
``When I caught up to him, he pulled a 9 mm pistol on me. I had to 
shoot him in the leg to subdue him. He was typical of the methers we 
see: paranoid, armed and violent.''
    The prior March, Alabama conservation officer Jimmy Hutto learned 
just how paranoid, armed and violent meth cookers can be. While 
arresting a man for fishing without a license, he found meth and soon 
was involved in serving a search warrant on the suspected cooker. But 
the man's property was wired to detect intruders. And when Hutto broke 
down the door to the lab, the cooker was waiting and shot the 
conservation officer in the abdomen. Hutto died two weeks later.
                            a rural scourge
    These incidents are not isolated. Law enforcement and conservation 
officials we contacted across the country describe a wave of 
methamphetamine manufacturing activity that has crashed across the 
rural countryside in the last five years, causing a dramatic change in 
the way game wardens operate and in the way hunters, anglers and other 
recreationists should conduct themselves afield.
    ``The landscape is changing,'' says Keith Aller, deputy director of 
law enforcement for the U.S. Bureau of Land Management. ``Twenty years 
ago meth was an outlaw biker thing, an urban thing. But in the past 
five years we've seen cookers take their labs to the forests and rural 
areas to avoid detection and to dump the toxic by-products of their 
work. We've also seen meth addicts exploiting public lands to pay for 
their habits. I don't want to sound alarmist, but people need to 
understand what we're up against these days and what they might 
encounter when they head outdoors.''
                             meth's history
    Methamphetamine was first synthesized in Japan in 1919 and was 
widely prescribed to Allied and Axis combatants to keep them awake 
during protracted World War II battles. Marketed as Benzedrine in the 
1950s, it was the drug of choice for people who wanted to lose weight. 
A decade later, outlaw biker gangs in the United States learned the so-
called ``Birch'' or ``Nazi method'' of manufacturing the drugs from 
over-the-counter cold medicines, and created the market for speed.
    Congress made the drug illegal without a prescription in 1970, but 
by the early 1980s new recipes had made meth easier to cook and more 
potent, offering the user a 6- to 24-hour high that also damaged the 
brain.
    This super-meth took off in Hawaii and Southern California first, 
manufactured by Mexican drug cartels. But soon the drug was being 
manufactured by mom-and-pop cookers, and within 20 years it spread 
eastward through the Rocky Mountains, into the Midwest and onto the 
East Coast. An urban phenomenon at first, it turned rural as the rank 
odors associated with its production caused cookers to set up in less 
populated areas to avoid detection. That practice has placed some meth 
labs in the same woods and waterways as hunters, anglers and other 
outdoorsmen.
    Consider that in 2003 the greatest number of reported meth lab 
seizures on Department of Interior lands occurred on those managed by 
the Fish & Wildlife Service (38 laboratories), followed by the Bureau 
of Land Management (31 laboratories), National Park Service (8 
laboratories) and Bureau of Indian Affairs (6 laboratories). That same 
year, the National Forest Service discovered 56 working labs on its 
land.
                            hunters and meth
    But those numbers are believed to be only a fraction of the 
activity on federal land, not to mention state and private property. 
And anecdotal evidence of meth invading the outdoors is easy to come 
by.
    In November 2004, for example, deer hunters on state land near 
Reelsville, Ind., came upon a duffel bag containing an actively cooking 
meth lab. They wisely backed away from the potentially explosive 
situation and notified the local police, who quickly dismantled and 
removed it.
    Twelve months earlier in Ashley County, Ark., deer hunters tipped 
sheriff's investigators to the fact that methamphetamine manufacturers 
had taken over remote deer blinds and were using them as labs. 
Narcotics detectives ended up finding four cooking operations set up in 
Ashley County deer blinds. In Wright County, Minn., four years before, 
cookers decided to use ice-fishing shanties to manufacture meth on 
Waverly Lake. Game wardens notified Sheriff's Sergeant Todd Hoffman of 
the activity. When Hoffman arrived to investigate, he noticed a solvent 
smell seeping from one of the shacks.
    Some of the more dangerous ingredients found in meth labs include 
lithium battery acid, charcoal lighter fluid and paint thinner. But the 
most common component--other than cold and allergy medicines that 
contain the drug pseudoephedrine--is anhydrous ammonia. Cookers 
sometimes steal this fertilizer from storage tanks on rural farms, 
ranches and supply stores.
    Needing more evidence to justify a search, Hoffman sifted through a 
nearby trash pile. When he picked up a thermos, anhydrous ammonia gas 
erupted from the vessel.
    ``My face began to burn, and for five or ten seconds I couldn't 
breathe,'' Hoffman told the Minneapolis City Pages newspaper. ``I 
thought my face was dissolving.''
    Hoffman was lucky not to have been seriously injured: When 
anhydrous ammonia contacts skin, it forms ammonium hydroxide, a highly 
caustic liquid that burns. Exposure to low levels of some meth 
ingredients like anhydrous ammonia can cause flu-like symptoms. Higher 
levels of exposure can cause lung and eye damage, chemical burns and 
even death.
    Idaho Fish and Game officer Clint Rand was involved in a meth-
related theft in 2000. Rand pulled over to help a disabled vehicle only 
to be shot at four times by the occupants, who had recently stolen 
anhydrous ammonia from a fertilizer supply store in Farmington, Wash., 
at gunpoint.
    ``Rand was very lucky not to have been hit,'' says Idaho Fish and 
Game law enforcement bureau chief Jon Heggen. ``But they blew out his 
windshield. It affected him and his family greatly. He recently decided 
to retire. That said, we're not experiencing the level of activity seen 
in other parts of the country. We've found labs in abandoned mines and 
dumps in the forest, but it's not widespread. However, it only takes 
one to get your attention. Meth goes beyond the bad guys trying to harm 
you. The stuff they leave behind in those dumps can kill you.''
                           toxic waste dumps
    Indeed, as any law enforcement or conservation officer familiar 
with meth will tell you, one of the truly insidious aspects of the drug 
is that the waste associated with its manufacture is as dangerous as 
the drug, the labs or the users.
    According to the National Drug Intelligence Center, every pound of 
meth creates 5 to 7 pounds of toxic waste. Of the 32 chemicals required 
to make meth by the Nazi method, for example, a third of them are so 
poisonous that cleanup workers have to wear biohazard suits and 
respirators.
    The chemical residues of meth manufacture can include lye, 
phosphorous, hydrochloric acid and iodine. Dump sites can include 
contaminated coffee filters stained red from the dye in cold medicines, 
mason jars or Pyrex baking dishes, rubber and plastic hosing, plastic 
bottles, salt, industrial solvent tanks, discarded methanol or alcohol 
bottles, white gas containers and propane tanks with the brass fittings 
stained blue or green from contact with anhydrous ammonia.
    According to congressional testimony, it can take up to eight hours 
and $5,000 to $20,000 to clean up a meth lab. Depending on its size, 
the manpower and money required to clean up a meth dump site are less. 
But when the lab or the dump is outdoors, there are hidden costs, such 
as contamination of groundwater and the potential poisoning of game, 
hunting dogs or humans--all things that law enforcement officers who 
patrol the great outdoors are forced to keep in mind these days.
                      law enforcement's new burden
    ``Before 2000, we'd be hard-pressed to find a meth dump. Now it's 
not uncommon to find two or three a week,'' says Patrol Captain Dennis 
Whitehead, who oversees law enforcement in Kentucky's Daniel Boone 
National Forest. ``Drug crimes have come to the forest in a big way. 
We're not just squirrel cops anymore. Sometimes forty percent of our 
job is associated with drugs. We've had cookers use campsites. We've 
had them drive roads with the stuff cooking in their cars. We've even 
had a ring of poachers who were shooting deer and trading the meat for 
meth. In the last five years, being a forest ranger has changed one 
hundred and eighty degrees, and it's all due to that drug.''
    Indiana conservation officer Gregg agrees: ``Meth has changed my 
job. It's gotten to the point where as a conservation officer these 
days you're better off going into a situation thinking you may be 
dealing with meth rather than a game violation.''
    The state-by-state statistics back up Gregg's grim assessment. The 
Drug Enforcement Administration reports that in 1999 in Indiana, there 
were 151 methamphetamine incidents where law enforcement officials, 
including conservation officers, had to deal with labs, dump sites or 
disposal of cooking chemicals or equipment.
    The following year the incidents in Indiana more than doubled to 
353. By 2004, the latest year for which numbers are available, the 
state reported 1,074 cases in which law enforcement officials had to 
confront meth labs or dumps in the course of their work.
    The situation was even worse in Missouri, where the number of meth 
incidents jumped from 439 in 1999 to 2,885 in 2003 before falling 
slightly (to 2,788) in 2004. In those years nearly 70 percent of the 
dumps were found in the Mark Twain National Forest, one of the best 
places to hunt in the state.
                            sportsmen warned
    Iowa had the second-highest number of meth-lab incidents in 2004. 
Like several other states, including Montana, South Dakota and 
Tennessee, Iowa has taken to informing hunters and other outdoor 
enthusiasts about the threat.
    The Iowa Division of Natural Resources, for example, now posts 
warnings on its Web site and at its offices around the state, alerting 
hunters to the potential hazards they face from meth when afield.
    ``It's sad to say, but many of our best hunting and fishing areas 
are conducive to cooking and dumping meth,'' says Lowell Joslin, chief 
of law enforcement for the Iowa DNR. ``We've found as an agency that 
one of the best things we can do is put information out to sportsmen. 
We want to educate them about meth so they know for their own health 
what to do when they encounter a lab or a dump, and also to have them 
report what they find to the nearest law enforcement agency.''
    Like many rural states these days, Iowa provides its conservation 
officers with extensive training in drug enforcement and drug lab/drug 
dump recognition and management. The state also includes a 
methamphetamine awareness component in its hunter-safety courses.
    ``In every hunter-ed course I teach, I talk about meth,'' says Iowa 
conservation officer Kirby Bragg. ``It's just a smart thing to do. For 
a while there out in the field I was running across active labs or the 
remnants of labs two to five times a week. The most memorable incident 
occurred opening day of deer season in 2003. I spotted a guy in a van 
parked with his motor running on a road adjacent to one of our more 
popular hunting areas. I didn't know if he was hunting or what. When I 
tried to approach him, he took off and we ended up in a high-speed 
pursuit. Turns out he had an active lab going in the back of the van. 
Moving meth labs are essentially moving bombs. We never had to deal 
with that kind of thing ten years ago.''
    Nor did outdoor law enforcement officials have to deal with the 
kind of random paranoid violence that BLM ranger Steven Martin faced in 
California in 2003.
    ``He was driving on a remote section of BLM land and happened on 
two guys sitting in a car,'' says BLM deputy director Aller. ``When he 
approached, they immediately opened fire and then took off into the 
hills. These were young kids, eighteen to twenty, with no history of 
violence. But meth was found in the car and when they were finally 
apprehended, they told investigators they felt their best option was to 
kill the ranger when he stopped them. That's extreme, but that's what 
meth does to people.''
    Another incident Aller cites shows how far meth addicts are willing 
to go to support a habit, and how that can lead to the destruction of 
property and murder.
    ``The BLM administers two hundred and sixty million acres out west, 
and that land includes all sorts of recreational, archeological and 
paleontological resources that can be and have been stolen by addicts 
and sold to buy more meth,'' Aller says. ``In early 2005, for example, 
one of our special agents in Oregon got word that a group of meth 
addicts were dismantling a BLM bridge and selling it as scrap aluminum. 
It sounds screwy, but that's what they were doing. Anyway, our bridge 
was disappearing, so the agent began to investigate, and he identified 
the people he thought were responsible and started doing interviews. It 
turns out that the suspects believed one of their own was cooperating, 
so they killed him. Because of a bridge. Again, extreme, but that's 
what meth does.''
                             fighting back
    Thankfully, there is some good news on the prevention front: In the 
past year, many of the rural states hit hardest by the drug have passed 
strong laws limiting access to over-the-counter cold and allergy 
medicines that contain pseudoephedrine. Many are based on a law first 
passed in Oklahoma that resulted in an 80 percent reduction in meth lab 
seizures in that state since April 2004.
    The laws require products containing pseudoephedrine to be sold 
behind the pharmacy counter. They also limit the purchase of 
pseudoephedrine products to 250 thirty-milligram pills a month and 
require buyers to present I.D. and sign for the medicine at the time of 
sale.
    Iowa, one of the hardest-hit states, has gone several steps 
further, requiring a prescription for pseudoephedrine medicines. And 
some Iowa counties have started distributing locks that prevent 
anhydrous ammonia from being stolen from retailers.
    ``It's helped,'' says Iowa conservation officer Kirby Bragg. ``I 
haven't run across as many labs or dumps this year as I did just two 
years ago.''
    Indiana conservation officer Mike Gregg has seen a similar drop but 
cautions all outdoor enthusiasts to be careful in the woods and on 
lakes.
    ``It has slowed a little,'' Gregg says. ``The new laws are good and 
so are ideas like locking up anhydrous tanks. But meth cookers are 
clever. We've already seen them shifting from using anhydrous ammonia 
to using red phosphorous in their labs. We're also hearing about them 
experimenting with cold alcohol as a component. When it comes right 
down to it, meth is highly addictive and highly lucrative, and it isn't 
going away anytime soon. People who live or recreate in rural areas 
need to be aware of its dangers.''
                 what to do if you encounter a meth lab
    Okay, so you come across what looks like a high school chemistry 
experiment that stinks or a pile of trash dumped somewhere in your 
hunting woods or streamside of your favorite trout river. What do you 
do?
    First, err on the side of caution. Meth labs and meth dumps are 
dangerous places. If actively cooking, meth labs are highly volatile 
and can explode. And meth dumps are filled with toxins. So get back. If 
you're hunting with dogs, get your dogs back, too. If you've got a 
binocular, use it to confirm what you're looking at.
    With an active lab or a dump, you'll see a combination of these 
items: glass jars, rubber tubing, thermometers, aluminum foil, 
blenders, cheesecloth, coffee filters, funnels, gas cans, hot plates, 
paper towels, propane, Pyrex dishes, rubber gloves, strainers, duct 
tape and clamps.
    The chemicals involved are harder to identify unless they're 
labeled. But expect that any lab or dump might contain the following: 
acetone; isopropyl or rubbing alcohol; cold pills containing ephedrine 
or pseudoephedrine; drain cleaner (sulfuric acid); engine starter 
(ether); iodine; HEET gasoline additive; lithium batteries; matches for 
red phosphorous; muriatic acid, anhydrous ammonia; Red Devil lye; salt; 
or trichloroethane, which ironically is a common gun-cleaning solvent.
    If, based on what you can see from a distance, you believe you've 
stumbled onto a lab or a dump, back completely out of the area and 
contact the closest law enforcement department, including rangers and 
conservation officers. They'll get hazardous-materials experts to 
dismantle and clean up the mess.
    ``We don't want hunters or anglers to get hurt, but if they locate 
some of the meth activities and report them, it's a big help to us,'' 
says Lowell Joselin, chief of law enforcement for the Iowa Division of 
Natural Resources.
                                 ______
                                 
 Prepared Statement of The Trust for Public Land, Land Trust Alliance, 
 The Nature Conservancy, The Conservation Fund, The Ocean Conservancy, 
    Association of National Estuary Programs, and Restore America's 
                               Estuaries
    On behalf of The Trust for Public Land, Land Trust Alliance, The 
Nature Conservancy, The Conservation Fund, The Ocean Conservancy, 
Association of National Estuary Programs, and Restore America's 
Estuaries, we would like to thank you for your strong support of our 
nation's Coastal Zone Management Program, and coastal land 
conservation. We are writing today in support of the Coastal and 
Estuarine Land Conservation Program (CELCP).
    Created by Congress in 2002, CELCP protects ``those coastal and 
estuarine areas with significant conservation, recreation, ecological, 
historical or aesthetic values, or that are threatened by conversion 
from their natural or recreational states to other uses.'' Thus far, 
this program has invested over $177 million towards 119 conservation 
projects in 25 of the nation's 35 coastal states, and has helped 
preserve some of America's greatest coastal treasures. All federal 
funding has been leveraged by at least an equal amount of state, local 
and private funds. NOAA has a proud 200-year tradition of sound 
management of our nation's coastal resources, and the CELCP program 
further builds upon that achievement. We hope to continue this federal-
state partnership and encourage you to fund CELCP at $80 million for 
fiscal year 2008.
    Our nation's coastal zone is under significant pressures from 
unplanned development. In fact, it is estimated that by 2025, nearly 75 
percent of the nation's population will live within 50 miles of the 
coast, in addition to millions more who enjoy America's storied 
coastlines. Across the nation, beaches and waterfronts have always been 
the destination of choice for Americans. Billions of dollars of the 
country's GDP are generated by coast-based economic activities, 
inexorably linking our coastal zone with the economic health of the 
nation.
    As a result of this economic boom, rapid, unplanned development has 
marred once-pristine viewsheds and substantially reduced public access 
to the coast. The resulting increase in impervious surfaces has 
correspondingly increased non-point source pollution and seriously 
degraded coastal and estuarine waters. The loss of coastal wetlands has 
drastically impaired estuaries, some of the most productive habitat on 
earth. The U.S. Commission on Ocean Policy has also stressed the 
importance of land conservation as part of its broader recommendations 
to Congress and the Nation.
    Increased funding for CELCP will complete a substantial number of 
important coastal conservation projects around the country, many of 
which still hang in the balance from the yet-undecided fiscal year 2007 
allocation. While we are optimistic at the first-time inclusion of 
CELCP in the President's fiscal year 2008 proposed budget, the proposed 
funding level is vastly lower than what is needed on the ground and 
well below what your subcommittee has historically proposed. While this 
signal of the Administration's growing support for the program is an 
important and welcome milestone in the evolution of the federal-state 
CELCP partnership, the strong support of Congress is paramount. Again, 
we urge you to sustain that partnership this year by using your 
discretion to fund CELCP at $80 million in fiscal year 2008. We look 
forward to working with you as this process moves forward.
                                 ______
                                 
 Prepared Statement of the Fond du Lac Band of Lake Superior Chippewa, 
   Nisqually Tribe of Washington, Puyallup Tribe of Washington, and 
         Shoshone-Paiute Tribes of the Duck Valley Reservation
    Chairwoman Mikulski, Ranking Member Shelby and members of the 
Subcommittee, we respectfully submit the following written testimony 
regarding funding for tribal law enforcement and justice programs 
within the Department of Justice budget. In fiscal year 2008, as in 
past years, the President has proposed significant cuts to several 
grant programs that provide critical funding to tribal law enforcement 
agencies and justice systems. If enacted, these cuts will cripple 
tribal justice systems. We respectfully request that you reject these 
proposed cuts. We would also like to endorse the recommendations made 
by the Senate Committee on Indian Affairs in its ``views and 
estimates'' letter.
                              introduction
    The need for law enforcement resources across Indian country is 
severe. Today, there are 1.3 law enforcement officers per 1,000 
citizens in Indian county, compared to 2.9 law enforcement officers per 
1,000 citizens in non-Indian communities. It is estimated that more 
than 2,000 additional officers are required across Indian country just 
to meet minimum safety standards. Police officers working on 
reservations frequently have to patrol alone because of personnel 
shortages. Understandably, newly-trained and veteran officers often 
leave to take jobs that require less of a risk to their personal 
safety, exacerbating officer shortages. Equipment needs are also great. 
Tribal law enforcement agencies need stable funding to address these 
core shortages. This need has become even more severe in recent years 
because of increased methamphetamine use, production and trafficking on 
reservations. It is a vicious cycle--lack of funding for even the most 
basic elements of a law enforcement program is part of what contributes 
to the perception that reservations are ``lawless.'' This perception is 
what makes our communities attractive to drug dealers, which in turn 
increases the need for resources.
    Of course, effective crime prevention takes more than just police 
officers. Tribes also operate court systems, detention facilities, drug 
treatment services and other alternatives to detention. Many tribes 
have also invested in preventative programs, such as youth centers, 
youth activity programs and drug education. As governments, we 
recognize our responsibility for fostering positive change and 
rehabilitation, even in our jails. More often than not, the inmates are 
people from our community who will be returning to the community when 
they are released, so we have a particular incentive to help them 
pursue positive changes. Without all of these services, though, we are 
stuck in a cycle of arresting and locking up our own people.
                                requests
    Office of Justice Programs, State and Local Law Enforcement 
Assistance.--For fiscal year 2008, the Department of Justice has 
requested $550 million for state and local law enforcement assistance 
within the Office of Justice Programs. Instead of breaking the funding 
request down into specific grant programs--as in past years, the 
Administration instead requests $312 million for flexible public safety 
grants under the Byrne Public Safety and Protection program and $180 
million for a violent crime reduction partnership initiative. However, 
this reorganization of the OJP budget camouflages an overall decrease 
of $900 million for all the programs included in this category. While 
such flexible funding initiatives can often be useful to tribes, the 
Administration's proposal would (1) significantly reduce the overall 
funding amount and (2) eliminate any specific set-aside for tribes. We 
are greatly concerned that, without this set-aside, tribal programs 
will lose funding because they are forced to compete with all other 
programs. We request that Subcommittee reject any decrease in the 
programs and, specifically, we ask that the following tribal justice 
programs be funded at least at fiscal year 2007 levels:
  --Tribal courts--No less than $8 million.
  --Indian Country Grant program--No less than $5 million.
  --Correctional Facilities on Tribal Lands--No less than $20 million 
        to address the facility needs documented by the Office of the 
        Inspector General.
  --Bureau of Justice Assistance, Indian Alcohol and Substance Abuse 
        Demonstration Program--No less than $5 million.
    Tribal Youth Program.--The Administration again proposes an overall 
decrease of $100 million for child safety and juvenile justice 
programs. As with state and local law enforcement assistance, the 
proposal would consolidate several programs into the new Child Safety 
and Juvenile Justice Initiative, a single, flexible, competitive grant 
program. This would encompass funding for Juvenile Justice and 
Delinquency Prevention, Juvenile Delinquency Block Grants, Internet 
Crimes Against Children, and several other grant programs. By combining 
these programs, however, the Administration tries to hide its overall 
reduction and also eliminates the set-aside for tribes typically 
provided by the Tribal Youth Program earmark. We ask that the 
Subcommittee provide at least as much funding for these programs as was 
provided last year. Most importantly, we ask that the Subcommittee 
restore the $10 million earmark for the Tribal Youth Program.
    Indian Country COPS.--The Administration proposes to completely 
eliminate funding for the Indian Country COPS program. The 
justification provided is that tribes can apply for competitive grants 
under other OJP programs, but--as described above--the Administration 
is in fact decreasing funding for those programs. Since its 
establishment in fiscal year 1999, the COPS program has provided 
essential public safety services in Indian County and has assisted 
tribes in increasing the number of law enforcement officers. We simply 
cannot afford to lose these officers, which is what will occur if COPS 
funding is cut. We ask the Subcommittee to restore funding for the COPS 
program at $33.2 million, the fiscal year 2007 amount.
    Office of Violence Against Women.--The Office of Violence Against 
Women administers the programs authorized by the Violence Against Women 
Act (VAWA). The most recent VAWA reauthorization provided for a range 
of important intervention, support and enforcement programs. 
Importantly, that law also provides that 10 percent of all appropriated 
funds be set aside for Indian tribes. These programs are of critical 
importance in Indian country, where the rates of domestic violence are 
extremely high. As Congress found, Indian women are battered at a rate 
of 23.2 per 1,000 (compared with 8 per 1,000 among Caucasian women). 
From 1979 through 1992, homicide was the third leading cause of death 
of Indian females aged 15 to 34, and 75 percent were killed by family 
members or acquaintances. Rape is also far too common--1 out of every 3 
American Indian and Alaska Native women are raped in their lifetimes. 
Indian women experience 7 sexual assaults per 1,000 (compared with 4 
per 1,000 among Black Americans, 3 per 1,000 among Caucasians, 2 per 
1,000 among Hispanic women, and 1 per 1,000 among Asian women). 
Unfortunately, these programs have never been funded up to authorized 
levels. For fiscal year 2008, the Administration proposes yet another 
decrease. We ask the Subcommittee to restore funding for VAWA programs 
to at least $387 million, the amount provided in fiscal year 2006.
    Office of the United States Attorney.--We would like to see funding 
increased for local Assistant U.S. Attorneys with responsibilities for 
Indian country law enforcement sufficient to support at least one full-
time position. Currently, the part-time hours of many Indian country 
AUSAs make effective law enforcement on our Reservations difficult.
                                context
    We would like to give the Committee a picture of the law 
enforcement systems in our communities and some of the specific needs 
we face.
    Nisqually Tribe.--The Nisqually Reservation is located in 
Washington State. Our Reservation is approximately 5,000 acres. We 
serve approximately 6,000 Indian people in our service area, about 600 
of whom are enrolled tribal members living on the Reservation, and the 
rest of whom live in surrounding areas. We have a land-based police 
force with nine officers, which is solely responsible for enforcing 
tribal law and also works closely with local police on other matters. 
Our police also have extensive marine water enforcement duties. We 
employ two water patrol officers to patrol over 100 square miles of 
Puget Sound for both the treaty salmon fishery and treaty shellfish 
harvesting. We also provide hunting enforcement for over 50,000 acres 
of land in the Tribe's usual and accustomed area within the Nisqually 
River watershed. Besides our police department, we have a tribal court 
with two full-time judges, and we employ ten detention officers at our 
45-bed detention facility (built in 2002). Like many other tribes, we 
are struggling to cope with escalating methamphetamine use and 
associated increases in gang activity and property crime related to 
dealing and manufacturing.
    Shoshone-Paiute Tribes.--The 463-square mile Duck Valley 
Reservation straddles the border of Nevada and Idaho. We have 
approximately 1,700 tribal members, about 900 of whom live on the 
Reservation. Our population is very young--nearly 70 percent of our 
people are under the age of 34. Much of our law enforcement is handled 
by the Bureau of Indian Affairs. However, the DOJ has been an important 
source of funding for us--for example, we have received grants in the 
past to construct a juvenile detention facility and to encourage 
enforcement of protection orders. At this time, our greatest need is 
more help from federal law enforcement officials, such as regional 
AUSA.
    Puyallup Tribe.--The Puyallup Reservation is located in the 
urbanized Seattle-Tacoma area of the State of Washington. The 18,061-
acre reservation and related urban service area contains 17,000 plus 
Indian people from over 435 Tribes and Alaska Villages. The Puyallup 
Nation Law Enforcement Division currently has 26 commissioned officers 
to cover 40 square miles of reservation in addition to the usual and 
accustomed areas. We currently operate with limited equipment, patrol 
vehicles requiring constant repair and insufficient staff levels. With 
the continuing increase in population, increase in gang related 
activities on the Puyallup Reservation and the impact of the increase 
in manufacturing of methamphetamines in the region, the services of the 
Puyallup Nation Law Enforcement Division are exceeding maximum levels.
    The demand on law enforcement services will increase as tribal 
governments continue to enhance civil and criminal justice 
administration and as tribal governments play an integral role in 
securing America's borders, citizens and physical infrastructure. This 
demand is further impacted by the existing and growing ``gang problem'' 
within the boundaries of the Puyallup Reservation. These gangs are 
different than other reservations due to our urban setting (Puget Sound 
region of the State of Washington), five other city boundaries next to 
our exterior boundaries, six separate local jurisdictions and 
Interstate 5 traversing through the reservation. In an effort to combat 
these gang activities, the Puyallup Tribal council created a Gang Task 
Force from the Tribal Police Department, representatives from various 
Tribal Services Divisions and community members. The Gang Task Force 
developed a gang policy that includes a four-prong approach to gang 
related activities: (1) enforcement, (2) intelligence, (3) education, 
and (4) and physical-mental health. We have begun to implement this 
strategy, but such a major law enforcement undertaking will require 
more officers, additional and continued training, specialized 
equipment, and adequate detention facilities for adults and juveniles.
    A major area of concern is the status of the Tribe's Regional 
Detention Facility. Due to damages from the February 2001 Nisqually 
earthquake, we have had to relocate to modular/temporary facilities. As 
a regional detention facility, the relocation to the modular facility 
not only impacts the Tribe's ability to house detainee's but also the 
approximately 173 native inmates that were incarcerated at the Puyallup 
Incarceration facility during the period of 2001-2002. Relocation to 
the modular facility has also impacted the Tribes ability to house 
juvenile detainees. With no juvenile facilities, our youth are sent to 
non-Native facilities. Both the Department of the Interior and the 
Department of Justice have essentially stopped providing construction 
funding since 1998. Yet the need for new and replacement facilities is 
still great.
    Fond du Lac Band of Lake Superior Chippewa.--The Fond du Lac Band's 
law enforcement program grew out of the Band's responsibilities for 
enforcing conservation laws that protect natural resources and regulate 
Band members who hunt, fish and gather those resources both within and 
outside the Reservation pursuant to rights reserved under Treaties with 
the United States in 1837 and 1854. The Band's rights to hunt, fish and 
gather on lands ceded under these treaties have been recognized and 
upheld by the federal courts and the United States Supreme Court. Under 
established Band conservation law, the Band is responsible for 
enforcing regulations over approximately 8,000,000 acres in northern 
and central Minnesota. It is also essential that the Band continue to 
manage its on-reservation resources in order to meet the demands of an 
increasing population. The on-reservation resources are vitally 
important to Band members as they provide the foundation for our 
culture, subsistence, employment and recreation.
    Following a Minnesota Supreme Court decision in 1997 holding that 
the State did not have jurisdiction to enforce traffic laws on roads 
within Indian reservations, the Band needed to establish a Tribal law 
enforcement department to address on-reservation law enforcement needs. 
The Band has done this, using a combination of tribal funds and federal 
funds (made available through the Community Oriented Policing Services 
(COPS) program and the Bureau of Indian Affairs), and by entering into 
cooperative agreements with local law enforcement agencies. Due in 
large part to that decision, the Band responds to a few thousand calls 
every year including traffic stops, domestic assaults, disturbance, 
theft and drug and alcohol related incidences, to name just a few. The 
Band has also experienced an increase in law enforcement 
responsibilities as a result of the insurgence of methamphetamine and 
prescription drug use on our Reservation. Drug-related deaths and crime 
are dramatically increasing on our Reservation which in turn 
drastically increases our law enforcement responsibilities.
    With these increased responsibilities, the Band has begun to plan 
and develop strategies to address our law enforcement needs, including 
staffing, training, equipment, and educating our youth to prevent crime 
and drug use. The Band currently operates its law enforcement program 
with ten officers but would be able to better address the growing law 
enforcement needs if the Band had 15-20 officers, which would require 
additional funding for staffing, training, recruitment and retention. 
Further, the current budget does not allow the Band to offer 
competitive salaries needed to recruit and retain officers. Additional 
tribal officers would also enable the Band to ensure that a School 
Resource Officer be permanently located at the Ojibwe School and would 
allow the Band to implement programs aimed at educating youth about a 
career in tribal law enforcement. The Band is also developing a tribal 
process for issuing and enforcing orders for protection, which will 
compliment our existing family support services programs. In regards to 
equipment, the Band would be more efficient if it had its own 
intoxilizer instead of having to transport arrestees an hour away to 
the St. Louis County Jail for DWI processing. Lastly, and of 
significant importance, the Band anticipates that additional funding 
will be necessary to address support costs associated with upgrading to 
the advanced dispatching system already in use by St. Louis and Carlton 
Counties.
                               conclusion
    The need for law enforcement resources in each of our communities 
is great. We ask that the Subcommittee recognize the important role 
that the Department of Justice plays in providing law enforcement 
resources to tribes. At a minimum, we ask you to reject the 
Administration's proposal to eliminate specific tribal programs under 
its jurisdiction. If we can provide any additional information, please 
do not hesitate to contact our counsel, Mary J. Pavel or Addie C. 
Rolnick at Sonosky, Chambers, Sachse, Endreson & Perry, LLP, 1425 K 
Street NW, Ste. 600, Washington D.C. 20005; 202-682-0240 (tel); 202-
682-0249 (fax); [email protected]; [email protected].
                                 ______
                                 
          Prepared Statement of the UNH Cooperative Extension
    Madam Chairwoman and Honorable members of the Subcommittee, I 
appreciate the opportunity to provide testimony in support of an 
appropriation of $1,300,000 from NOAA's Coastal and Estuarine Land 
Conservation Program to protect the 288-acre Isinglass River 
Conservation Corridor in New Hampshire.
    In addition, I would like to urge your support for a substantial 
increase in overall funding for the Coastal and Estuarine Land 
Conservation Program in fiscal year 2008 to enable the protection of 
significantly more coastal resources than in previous years. While we 
are pleased that the program has been recommended in the President's 
budget for $15 million, this level, while a good first step, is 
inadequate when compared to the needs from across the country, and what 
Congress has historically provided for this program.
    I work with UNH Cooperative Extension as an Educator in Land and 
Water Conservation in 62 communities within Rockingham County and north 
to the extent of the Great Bay watershed. My involvement with 
conservation over the past three years has resulted in the successful 
completion of more than 130 projects covering in excess of 6,000 acres. 
The Isinglass River Conservation Corridor is one of the most exciting 
that I have been involved with during this period. My role from the 
outset has been to bring the landowner, the community, a regional land 
trust Bear-Paw Regional Greenways and the Trust for Public Lands 
together to try to find a way to conserve the keystone property in this 
important river corridor.
    Of New Hampshire's many waterways, only 14 rivers have the 
distinction of being officially recognized by the state's Rivers 
Management Protection Program for outstanding natural and cultural 
resources. The Isinglass River, which flows freely for its entire 18-
mile course through the southeastern portion of the state, is one of 
these select few. Winding its way through one of the most rapidly 
developing portions of the state, the scenic and ecological conditions 
which make the Isinglass so unique are increasingly in jeopardy. As 
expanding development is frequently accompanied by habitat loss, 
degradation of water quality, and loss of recreational opportunities, 
programs such as the Coastal and Estuarine Land Conservation Program 
(CELCP) have been established to help protect and preserve landscapes 
vital to the healthy functioning of ecosystem processes.
    The Isinglass River property is 288 forested acres bounded to the 
west, northwest, and northeast by the Isinglass River. It is surrounded 
by 1,500 acres of contiguous forest, and has 7,800 feet of river 
frontage. The Isinglass River property is the top priority for the 
State of New Hampshire for CELCP funding in fiscal year 2008 and is 
located in a section of the river that is identified as a Conservation 
Focus Area in the New Hampshire Coastal Management Plan. In 2005, the 
New Hampshire State Wildlife Action Plan categorized the river corridor 
as Tier I habitat, the highest quality designation in the State. The 
current landowner has already submitted a subdivision plan for 72 
housing lots, which would forever fragment this large, undeveloped 
block of land along the Isinglass River.
    The length of the Isinglass River provides home to a variety of 
wildlife, including mink, otter, raccoon, deer, moose, black bear and 
bobcat, all of which would be threatened if development were to 
proceed. A wildlife inventory of the Isinglass corridor has confirmed 
the presence of several species classified at the federal and state 
level as threatened, endangered, or of special concern, which include 
the American bald eagle, common loon, osprey, Cooper's hawk, wood 
turtle, Blanding's turtle and spotted turtle. There is also the 
presence of a seven-acre beaver impoundment. The Isinglass River itself 
is considered an important fishery. Naturally occurring warm-water game 
fish include small and largemouth bass in the lower portion of the 
river. The New Hampshire Department of Fish and Game annually stocks 
more than 3,000 rainbow trout and 2,500 brook trout in the headwaters. 
In addition, over 73,000 Atlantic salmon fry are being stocked as part 
of an ongoing anadromous fish restoration effort. Several species of 
concern also are known to live in the Isinglass River, including the 
American eel, banded sunfish, bridle shiner, and the blacknose shiner, 
a fish located in only one other waterway in the state.
    The Isinglass River property will offer recreational benefits as 
well as habitat protection. A trail network already exists on the 
property, which makes hiking a main activity. Pig Lane, the road that 
provides access to the Isinglass River property, is used extensively 
for mountain biking. Hunting and fishing have long been historic uses 
of the property, and access for these activities will continue. The 
Isinglass River itself has been used extensively for fishing, boating, 
and other recreational uses. The river is considered to be an important 
seacoast trout stream and is heavily utilized by local anglers. Due to 
the free-flowing nature of the Isinglass River it provides both 
challenging whitewater and relaxing flatwater boating opportunities for 
canoeists and kayakers. Because of the importance of Isinglass River, 
as a fishery and recreational boating destination, New Hampshire Fish 
and Game would be interested in constructing and maintaining a car-top 
boat launch with access through Pig Lane.
    A fiscal year 2008 Coastal and Estuarine Land Conservation Program 
(CELCP) appropriation of $1.3 million, directed to the Town of 
Strafford, is needed to acquire and conserve this property. This 
appropriation will be matched with funds from the New Hampshire Land 
and Community Heritage Investment Program, New Hampshire Fish and Game, 
and private donations, and the value of match properties. The Town of 
Strafford has already committed up to $200,000 towards acquisition of 
this property.
    Thank you, Madam Chairwoman, for the opportunity to provide this 
testimony.
                                 ______
                                 
   Prepared Statement of the Clear Creek Nature and Cultural Tourism 
                                Council
    Madam Chairwoman and Honorable members of the Subcommittee, I 
appreciate the opportunity to present this testimony in support of an 
appropriation of $705,000 from NOAA's Coastal and Estuarine Land 
Conservation Program to acquire potential parkland along Clear Creek in 
Webster, Texas.
                        note about organization
    Identified for acquisition with fiscal year 2008 funds are 
approximately 90 acres in several ownerships within the proposed Clear 
Creek Park boundaries. Once acquired, the City of Webster will own and 
maintain the land as a public park and conservation area. Purchase of 
these properties is critical to the protection of habitat and 
recreational open space along Clear Creek, one of the few remaining 
unchannelized stream and river corridors in the Houston metropolitan 
area. Development is currently the largest threat to habitat in the 
Galveston Bay estuary, and some parcels within the park area have 
already been sold. If additional tracts in the proposed Clear Creek 
Park area are developed, the creek's floodway would be degraded by loss 
of wetlands and increase in runoff pollutants.
    The Clear Creek corridor offers the potential for significant 
recreational opportunities for residents and visitors. Several parks 
operated by local governments extend along the creek, including Harris 
County's Challenger Seven Memorial Park, Galveston County's Walker Hall 
Park, and League City's Erikson Tract and Clear Creek Nature Park. In 
order to enlarge and further link this important corridor of parks and 
reserves, the City of Webster has proposed the acquisition of 
approximately 200 acres along the northern banks of the creek for a new 
Clear Creek Park. Within the planned park area, the City of Webster 
envisions building a trail along Clear Creek for hiking and biking. The 
trail will also feature access to launch sites on the creek for 
canoeing and kayaking, small piers for fishing, observation points and 
decks for bird watching, and picnic areas for families. The multiple 
opportunities along the trail are expected to accommodate and 
contribute to outdoors and environmental education. The opening of a 
trail would also advance the Galveston Bay Estuary Program's goal of 
increasing public access to Galveston Bay and its tributaries.
    Galveston Bay was recognized in 1988 as an estuary of national 
importance in the EPA's National Estuary Program, one of 28 such 
estuaries in the nation. The comprehensive management plan of the 
Galveston Bay Estuary Program identified wetlands habitat loss and 
degradation as a priority problem in the estuarine system. Webster lies 
at the lower end of the Clear Creek watershed and is home to diverse 
communities of ecologically important coastal habitats and systems. 
Riparian forests of willow oaks, water oaks, and cedar elms provide 
habitat for amphibians, owls, hawks, neotropical migrant birds, and the 
reddish egret, a state-listed threatened bird species. Along the creek 
banks are several areas of coastal prairie. Near Clear Lake and the 
entrance to Galveston Bay, marshes, wetlands, and embayments support 
fish, waterfowl, and migrant birds.
    An appropriation of $705,000 from the Coastal and Estuarine Land 
Conservation Program (CELCP) is needed in fiscal year 2008. Clear Creek 
Park will protect critical coastal land and provide multiple 
recreational possibilities to residents of Webster and other nearby 
communities.
    In addition to specifically funding Clear Creek, I urge your 
support for a substantial increase in overall funding for the Coastal 
and Estuarine Land Conservation Program in fiscal year 2008 to enable 
the protection of significantly more coastal resources than in previous 
years. While I am pleased that the program has finally been recommended 
in the President's budget for $15 million, this level, while a good 
first step, is inadequate when compared to the needs from across the 
country, and what Congress has historically provided for this program.
    Thank you, Madam Chairwoman, for the opportunity to present this 
testimony in support of the Clear Creek project and the CELCP program.
                                 ______
                                 
              Prepared Statement of The Nature Conservancy
    Thank you for the opportunity to offer the recommendations of The 
Nature Conservancy on the fiscal year 2008 budget for the National 
Oceanic and Atmospheric Administration (NOAA).
    In general, we are concerned that funding for oceans in general and 
NOAA specifically is declining. The Conservancy urges the Committee to 
provide appropriations for NOAA at or approaching $4.5 billion, as 
recommended by the Joint Oceans Commission Initiative and the Friends 
of NOAA Coalition. This funding level for NOAA would allow enhancements 
in the development of an integrated ocean and atmospheric observing 
system; increased research and education activities, expanded ocean 
conservation and management programs; and provide critical improvements 
in infrastructure (satellites, ships, high performance computers, 
facilities), and data management. Such an increase would represent 
significant progress toward addressing recommendations contained in the 
reports of the U.S. Commission on Ocean Policy and the Pew Oceans 
Commission.
    The Conservancy works to identify priorities for coastal and marine 
conservation through marine ecoregional plans. We identify present and 
likely future threats to marine biological diversity before attempting 
to identify appropriate strategies for conservation. At more than one 
hundred marine sites around the world, the Nature Conservancy has used 
a variety of strategies for marine conservation including habitat 
restoration of important nursery and spawning areas, removal of 
invasive species, coastal land acquisition, private conservation of 
submerged lands, elimination of destructive practices, establishment of 
protected areas, management of extractive marine resources activities, 
and reduction of nutrient and toxic inputs to coastal systems. No 
single strategy works everywhere and at every site, multiple 
conservation approaches are needed. The selection of appropriate 
approaches depends on the biological, socioeconomic, and political 
circumstances at each site.
    The National Oceanic and Atmospheric Administration (NOAA) is an 
important partner to the Conservancy in many aspects of our 
conservation work:
  --We rely upon NOAA's data, research, and monitoring of coastal and 
        marine systems, and have several shared priorities on which we 
        collaborate. For example, NOAA's Coastal Services Center 
        maintains a strong customer-service, partnership-oriented 
        approach to providing needed information and technical 
        assistance to states, local governments, other federal 
        agencies, and the private sector to inform decision-making.
  --We rely on NOAA's programs that support site-based conservation--
        those that fund conservation and restoration activities, and 
        those that provide for management of coastal and marine 
        systems. NOAA's ability to meet its requirements under various 
        resource management statutes could be significantly improved by 
        enhancing the agency's ability to fund on-the-ground 
        conservation needs. Programs such as Coastal and Estuarine Land 
        Conservation, Community-based Restoration, Open Rivers 
        Initiative are excellent examples of NOAA taking a practical, 
        community-oriented approach to conservation and management of 
        coastal and marine resources. These programs should be 
        expanded.
  --NOAA's contributions to state and local implementation and 
        educational programs help to ensure that the human capacity 
        exists to address environmental management issues at the 
        necessary scale. We are concerned that NOAA's support for human 
        capacity to implement programs within the agency and at the 
        state and local levels is often the first to go in tight budget 
        environments. The Committee should provide funding for staff 
        capacity to provide technical assistance, efficiently manage 
        grants and programs, and help to measure effectiveness.
    Finally, we would like to offer the Committee our recommendations 
regarding funding levels and guidance regarding implementation of a 
number of key NOAA programs.
NOAA Habitat Restoration
    The Nature Conservancy requests increased funding for habitat 
conservation and restoration to support fisheries management 
objectives, protected species recovery, and other coastal and marine 
management requirements. Through existing programs, NOAA has clearly 
demonstrated their capability to achieve results by advancing 
constructive, on-the-ground and in-the-water habitat conservation. 
Habitat losses have a substantial impact on the health and productivity 
of marine ecosystems, yet NOAA's ability to work closely with 
communities around the country to stem or reverse these losses is 
constrained by the relatively small amount of funding they receive.
    We would urge you to consider increasing funding for the following 
programs in NMFS Office of Habitat and in the Office of Protected 
Resources:
            National Marine Fisheries Service--Office of Habitat, 
                    Fisheries Habitat Restoration
    Penobscot River Restoration ($10 million in fiscal year 2008).--In 
a 2004 study, the National Research Council \1\ identified removal of 
dams as a top priority near term action required to recover Atlantic 
salmon in Maine. Removal of the Veazie and Howland dams and 
modifications proposed at Howland dam on the mainstem of the Penobscot 
River--Maine's largest river system--present a remarkable opportunity 
to recover a species. This project will improve access to almost 1,000 
miles of habitat for Atlantic salmon, thousands of miles of habitat for 
American eel, and hundreds of miles for alewives. Atlantic sturgeon, 
shortnose sturgeon (both federally listed), tomcod, and smelt will 
recover lost access to their historic habitat ranges. Additionally, 
this project will provide benefits to the Penobscot Indian nation, will 
provide new recreational opportunities, and will come with no net loss 
of power production from the river, maintaining a clean and secure 
energy source for Maine's residents.
---------------------------------------------------------------------------
    \1\ National Research Council. Atlantic Salmon in Maine. National 
Academies Press. 275 pp. 2004.
---------------------------------------------------------------------------
    Community-based Restoration Program ($20 million in fiscal year 
2008).--Currently this program, with its exceptional 10-year track 
record, is able to fund only about 15 percent of the proposals it 
receives. Additional funds would be well-spent.
    Open Rivers Initiative ($10 million in fiscal year 2008).--In 
addition to the large barriers on rivers like the Penobscot, there are 
hundreds of thousands of small degraded barriers on rivers and streams 
across the United States. This Initiative is part of a multi-agency 
commitment to address this problem. We urge you to ensure that this new 
program is additive to NOAA's habitat restoration capacity, and doesn't 
reduce funding available for existing programs.
            National Marine Fisheries Service--Office of Protected 
                    Resources
    Cooperation with the States ($5 million in fiscal year 2008).--
Through this program, authorized under Section 6 of the Endangered 
Species Act, NMFS may provide grants to support conservation actions 
that contribute to recovery, including management, outreach, research, 
and monitoring projects that have direct conservation benefits for 
listed species, recently de-listed species, and candidate species that 
reside within that State. A comparable program for cooperation with 
states on ESA activities exists in U.S. Fish and Wildlife Service has 
been very successful in catalyzing and funding activities that 
contribution to the recovery of listed species.
    With the exception of jointly managed species (Atlantic salmon) 
activities related to NMFS jurisdiction species are not eligible for 
funding under the FWS program. NMFS has management responsibility for 
56 listed marine species in the United States. While substantial 
federal funding is directed to Pacific salmon species under their 
jurisdiction, there are few resources available to support proactive 
conservation efforts geared toward recovery of the other 30 species for 
which they have sole or joint management responsibility.
    With increased funding under this program, states would have a 
strong incentive to enter into cooperative agreements with NMFS under 
Section 6 and NMFS would have tools and resources to support more on 
the ground conservation efforts to abate threats to listed species 
(most grants to date have been for research or monitoring activities).
    This program has received $990,000 each year since fiscal year 
2003. On average, approximately 80 percent of appropriated funds have 
been granted each year with a minimum 25 percent non-federal cost 
share. Remaining funds are used for program management.
Coastal and Estuarine Land Conservation Program (CELCP)
    The Nature Conservancy supports funding CELCP at $80 to $100 
million for fiscal year 2008 and looks forward to working with the 
Committee to guide selection of high priority projects. We recognize 
that this is a substantial increase of prior year funding levels, but 
feel that it is warranted given the extraordinary circumstances 
surrounding the fiscal year 2007 budget and the pent-up demand left 
over from what we expect to be comparatively low funding levels in 
fiscal year 2007. We believe that the list of projects developed in 
fiscal year 2007 by NOAA to identify important, eligible and ready 
projects was a significant improvement to the program and hope that a 
similar list will be made available soon to offer guidance for the 
fiscal year 2008 process. We hope that it will be useful to the 
Committee as you make decisions regarding the future direction of this 
important program.
    We are concerned that NOAA continues to impose a $3 million per 
project cap in the guidance for the call for proposals. We are 
concerned that this cap may be either unnecessarily constraining or may 
lead to inflated project proposals. States should be encouraged to 
request what is needed to complete a given project within an 
appropriate timeframe, and should work with NOAA and the Congress to 
ensure adequate funding is available within budget constraints.
    Finally, we are increasingly concerned about the lack of dedicated 
staff capacity for CELCP at NOAA. Current practice is to assess a 
percentage of the project appropriation to cover NOAA staff costs. The 
problem is that up to a point, the costs of running a program are 
fixed. NOAA needs a dedicated line of funding to support program 
administration and management, and should be prohibited from assessing 
a percentage of project allocations to cover administrative costs.
Coral Reef Conservation Program and Coral Reef Watch
    The Conservancy has developed a strong partnership with NOAA's 
Coral Reef program, and we are delighted with their enthusiastic desire 
to work together on improving resilience of coral reefs, developing 
approaches for sustainable financing for coral conservation activities 
at the local level, and other creative approaches to reducing threats 
to corals. We would urge you provide $30.5 million for the program in 
fiscal year 2008, an increase over the Administration request of 
$25.797 million. The $30.5 million requested would include $1.5 million 
to support ``Local Action Strategies,'' a unique partnership between 
NOAA and states and territories to address threats to coral reefs at 
the local level.
    However, we are concerned with the decision made in the fiscal year 
2006 conference to cut funding for NESDIS coral monitoring in fiscal 
year 2006. Funding for Coral Reef Watch was included in bills produced 
by both chambers and the President requested $737,000 for this modest 
but effective program known as ``Coral Reef Watch.'' The program has 
received full funding in fiscal year 2007. In 2005, not only did NESDIS 
scientists in this program predict a major coral bleaching event in the 
Caribbean, but these scientists were able to reach out to NMFS, NOS and 
partners in the region to use the attention generated by the event to 
help local managers take action to help reefs recover from the 
devastating effects of bleaching.
Gulf of Mexico Governor's Alliance
    The Administration's budget included a request for $5 million to 
help implement the Gulf of Mexico Governors' Action Plan. The 
Conservancy urges the Committee to provide at least this amount to 
leverage action on the commitments made by the Gulf Coast Governors. 
The Alliance identified five priority issues that are regionally 
significant and can be effectively addressed through increased 
collaboration at state, local, and federal levels:
  --Improvement in Gulf water quality, with an emphasis on healthy 
        beaches and shellfish beds;
  --Restoration and conservation of coastal wetlands;
  --Environmental education;
  --Identification and characterization of Gulf habitats to inform 
        management decisions; and
  --Reductions in nutrient loading.
Pacific Coast Salmon Recovery Fund
    The Pacific Coast Salmon Recovery Fund (PCSRF) has funded hundreds 
of successful on the ground salmon conservation efforts, and we are 
pleased that NOAA and the states receiving these funds have greatly 
improved tracking the process of restoration and management under this 
important program.
    This program is a critical complement to federal salmon recovery 
and management efforts. It enables the state to initiate restoration of 
salmon habitat and manage fisheries in areas beyond the reach of the 
federal government, e.g. on private lands. The PCSRF enables the states 
to leverage significant amounts of state funding to address the needs 
of private landowners in complying with the Endangered Species Act, 
maintaining the economic viability of these lands, while greatly 
contributing to economic recovery.
    We are concerned about the decline in funding for the program, from 
$89 million in fiscal year 2004 and fiscal year 2005 to $67 million in 
fiscal year 2006, and $66.8 million in the President's fiscal year 2008 
request. The Conservancy strongly supports $100 million for this 
program. We are also concerned how the funds are allocated across the 
five states involved in the program. We feel that the conservation 
activities oriented towards recovery and protection of salmon should be 
the primary purpose of this program, and therefore urge the committee 
to consider including report language in this year's appropriation that 
more explicitly links expenditures of PCSRF funds to recovery actions 
identified in federal and state salmon recovery and management plans, 
where applicable.
    Thank you for this opportunity to share with the Committee the 
Conservancy's priorities in NOAA's fiscal year 2008 budget. We would be 
pleased to provide the Committee with additional information on any of 
the Conservancy's activities described here or elsewhere. You may 
contact Erika Feller at 703-841-5374 or via email at [email protected], 
if you have questions on which we might be of assistance.
    The Nature Conservancy is an international, nonprofit organization 
dedicated to the conservation of biological diversity. Our mission is 
to preserve the plants, animals and natural communities that represent 
the diversity of life on Earth by protecting the lands and waters they 
need to survive. Our on-the-ground and in-the-water conservation work 
is carried out in all 50 states and in 27 foreign countries and is 
supported by approximately one million individual members. We have 
helped conserve nearly 15 million acres of land in the United States 
and Canada and more than 102 million acres with local partner 
organizations globally.
    The Conservancy owns and manages approximately 1,400 preserves 
throughout the United States--the largest private system of nature 
sanctuaries in the world. We recognize, however, that our mission 
cannot be achieved by core protected areas alone. Therefore, our 
projects increasingly seek to accommodate compatible human uses to 
address sustained human well-being.






















       LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS

                              ----------                              
                                                                   Page
Alexander, Senator Lamar, U.S. Senator From Tennessee, Questions 
  Submitted by...................................................   375
American:
    Astronomical Society, Prepared Statement of the..............   415
    Indian Higher Education Consortium, Prepared Statement of the   448
    Institute of Biological Sciences, Prepared Statement of the..   426
    Museum of Natural History, Prepared Statements of the......427, 429
    Public Power Association, Prepared Statement of the..........   420
Association of National Estuary Programs, Prepared Statement of 
  the............................................................   465

Bement, Dr. Arden, Jr., Director, National Science Foundation....   131
    Prepared Statement of........................................   133
Byrd, Senator Robert C., U.S. Senator From West Virginia, 
  Questions Submitted by.........................................   105

California Industry and Government Central California Ozone Study 
  (CCOS) Coalition, Prepared Statement of the....................   451
Clark, John F., Director, United States Marshals Service, 
  Department of Justice..........................................   226
    Biographical Sketch of.......................................   235
    Prepared Statement of........................................   228
    Questions Submitted to.......................................   289
Clear Creek Nature and Cultural Tourism Council, Prepared 
  Statement of the...............................................   470

Domenici, Senator Pete V., U.S. Senator From New Mexico, 
  Questions Submitted by.......................................287, 340
Dudas, Jon W., Director, U.S. Patent and Trademark Office, 
  Department of Commerce.........................................    40
    Prepared Statement of........................................    42

Earp, Naomi Churchill, Chair, Equal Employment Opportunity 
  Commission.....................................................   343
    Prepared Statement of........................................   349
    Summary Statement of.........................................   346

Feinstein, Senator Dianne, U.S. Senator From California, 
  Questions Submitted by.........................................   157
Fight Crime: Invest in Kids, Prepared Statement of...............   422
Fond du Lac Band of Lake Superior Chippewa, Prepared Statement of 
  the............................................................   465

Gaviota Coast Conservancy, Prepared Statement of the.............   421
Great Lakes Indian Fish and Wildlife Commission, Prepared 
  Statement of the...............................................   458
Griffin, Hon. Michael D., Ph.D., Administrator, National 
  Aeronautics and Space Administration...........................   161
    Opening Remarks..............................................   166
    Prepared Statement of........................................   167
Gutierrez, the Honorable Carlos M., Secretary, Office of the 
  Secretary, Department of Commerce..............................     1
    Prepared Statement of........................................     7

Harkin, Senator Tom, U.S. Senator From Iowa, Questions Submitted 
  by.............................................................   374

Investment Company Institute, Prepared Statement of the..........   406

Jeffrey, Dr. William, Director, National Institute of Standards 
  and Technology, Department of Commerce.........................    32
    Prepared Statement of........................................    34

Kennedy, Senator Ted, U.S. Senator From Massachusetts, Questions 
  Submitted by...................................................   377
Kohl, Senator Herb, U.S. Senator From Wisconsin, Questions 
  Submitted by...................................................   103

Land Trust Alliance, Prepared Statement of the...................   465
Lautenbacher, Vice Admiral Conrad, Jr., Administrator, National 
  Oceanic and Atmospheric Administration, Department of Commerce.   117
    Prepared Statement of........................................   124
    Questions Submitted to.......................................   152
    Summary Statement of.........................................   121
Leahy, Senator Patrick J., U.S. Senator From Vermont:
    Prepared Statement of........................................   297
    Questions Submitted by................................100, 256, 323
    Statement of.................................................   295

Marine Conservation Biology Institute, Prepared Statement of the.   453
Meuller, Hon. Robert S., III, Director, Federal Bureau of 
  Investigation, Department of Justice...........................   295
    Prepared Statement of........................................   306
Mikulski, Senator Barbara A., U.S. Senator From Maryland:
    Opening Statement of.........................................     1
    Prepared Statement of........................................   301
    Questions Submitted by............................61, 152, 249, 369
    Statements of....................................117, 161, 197, 343

National:
    Association of Marine Laboratories, Prepared Statement of the   439
    Center for Victims of Crime, Prepared Statement of the.......   446
    Corn Growers Association, Prepared Statement of the..........   456
    Employment Lawyers Association, Prepared Statement of the....   381
    Federation of Community Broadcasters, Prepared Statement of 
      the........................................................   419
    Fish and Wildlife Foundation, Prepared Statement of the......   416
    Marine Sanctuary Foundation, Prepared Statement of the.......   434
    Treasury Employees Union, Prepared Statement of the..........   407
Nisqually Tribe of Washington, Prepared Statement of the.........   465
Northwest Indian Fisheries Commission, Prepared Statement of the.   435

Pacific Salmon Commission, Prepared Statement of the.............   413
Population Association of America/Association of Population 
  Centers, Prepared Statement of the.............................   438
Puyallup Tribe of Washington, Prepared Statement of the..........   465

Reed, Senator Jack, U.S. Senator From Rhode Island, Questions 
  Submitted by...................................................   104
Restore America's Estuaries, Prepared Statement of...............   465

Sea Grant Association, Prepared Statement of the.................   443
Shelby, Senator Richard C., U.S. Senator From Alabama:
    Questions Submitted by......................109, 160, 252, 272, 289
    Statement of.............................3, 119, 163, 198, 298, 345
Shoshone-Paiute Tribes of the Duck Valley Reservation, Prepared 
  Statement of the...............................................   465
Stevens, Senator Ted, U.S. Senator From Alaska, Question 
  Submitted by...................................................   288
Sullivan, Michael J., Acting Director, Bureau of Alcohol, 
  Tobacco, Firearms and Explosives, Department of Justice........   197
    Biographical Sketch of.......................................   209
    Prepared Statement of........................................   203
    Questions Submitted to.......................................   249
    Summary Statement of.........................................   202

Tandy, Hon. Karen P., Administrator, Drug Enforcement 
  Administration, Department of Justice..........................   209
    Prepared Statement of........................................   212
    Questions Submitted to.......................................   256
The Conservation Fund, Prepared Statement of.....................   465
The Nature Conservancy, Prepared Statements of.................465, 471
The Ocean Conservancy, Prepared Statement of.....................   465
The Trust for Public Land, Prepared Statement of.................   465

UNH Cooperative Extension, Prepared Statement of the.............   469
University Corporation for Atmospheric Research, Prepared 
  Statement of 
  the............................................................   430

West Creek Preservation Committee, Prepared Statement of the.....   424






















                             SUBJECT INDEX

                              ----------                              
                                                                   Page

                         DEPARTMENT OF COMMERCE

             National Institute of Standards and Technology

Additional Committee Questions...................................    61
American Competitiveness Initiative..............................    51
Center for Nano-Scale Science Technology.........................    58
Disaster Resilient Structures Studies............................    51
Effectiveness of Manufacturing Extension Partnership.............    59
National Institute of Standards and Technology:
    Collaboration With Industry..................................    60
    Funding Increase for American Competitiveness Initiative.....    57
Safety of Nano-Technology........................................    58

            National Oceanic and Atmospheric Administration

Additional Committee Questions...................................   151
American Competitiveness Initiative..............................   136
Aquaculture......................................................   153
Coastal:
    Non-Point Pollution..........................................   157
    Zone Management Grants.......................................   158
``Counterfeit'' Fish.............................................   152
Fiscal Year:
    2006 Accomplishments.........................................   125
    2008 Budget Request..........................................   123
        Highlights...............................................   127
Funding Increases for National Oceanic and Atmospheric 
  Administration Satellite Program...............................   146
Funding Levels for Severe Weather Research.......................   159
GOES Satellite Construction Time.................................   156
GOES-R Program TRL Level.........................................   155
International Polar Year Projects................................   144
International Whaling Commission.................................   145
National Academy of Sciences Report on Climate Change............   135
National Oceanic and Atmospheric Administration:
    Center for Weather and Climate Prediction Project............   154
    Corps Reauthorization........................................   160
    Disaster Response Centers....................................   138
    Sea Grant Program............................................   139
    Tsunami Warning Program......................................   134
NPOESS and GOES-R Funding Request................................   155
NRDC vs. Rodgers Settlement Implementation.......................   158
Ocean Initiative Funding.........................................   160
Polar Satellites.................................................   148
Probability of GOES-R Operational Gap............................   156
Progress on the U.S. Ocean Action Plan...........................   152
Regional Fisheries Council.......................................   138
Renewable Energy Research........................................   142
Susquehanna Basin Monitoring System..............................   135
Tsunami Warning System...........................................   134
Weather Modification Research....................................   140

                        Office of the Secretary

Additional Committee Questions...................................    61
Addressing:
    Patent Pendency and Application Backlog......................    16
    Recruitment, Training and Retention Challenges...............    19
Augustine Report on Immigration..................................    24
BEA's R&D Budget Initiative......................................   109
CAFTA--Sock Trade................................................   109
Census Deputy Director...........................................    30
Continued Dumping Subsidy Offset Act of 2000.....................   106
Departmental Management:
    Media Questions..............................................    79
    WCF and A&R..................................................    61
Doha Dispute Settlement Negotiations.............................   107
DVD Piracy in Mexico.............................................   114
Dynamics of Economic Well-Being..................................    91
Economic Development Administration Cut..........................    87
Economic Development Representative..............................    86
ESA Headquarters Staffing and Funding Levels.....................    90
Executive Summary................................................    13
Federal Consistency Standards and the CZMA for Florida and 
  Alabama........................................................   112
Funding for NOAA Education Programs..............................    92
Funding Levels for Severe Weather Forecasting....................   113
Gross Domestic Product Revision..................................    22
Improved Measurement of Services.................................    91
Increase Examiner Retention......................................    94
ITA:
    Assistant Secretary Status...................................    92
    CAFTA Nations................................................   114
    Chinese Subsidy Programs.....................................    92
    Export Fee Increase..........................................    91
    Trade Act 2002...............................................   105
    Western Hemisphere Travel Initiative.......................100, 101
Long-term Metric/Goal for Patent Pendency........................    94
Manufacturing Extension Partnership (MEP)........................    28
    And Economic Development Administration Funding..............    26
    And Energy Costs.............................................   104
    Defense Suppliers............................................   103
    Funding Levels...............................................    97
    Program......................................................   102
Meeting With Senator Reed's Staff on the Efficiency of Regional 
  Development Accounts...........................................    27
National Oceanic and Atmospheric Administration (NOAA):
    Exclusion from American Competitiveness Initiative...........    22
    JOCI and the Ocean Policy Scorecard..........................   110
    National Polar Orbiting Operational Environmental Satellite 
      System.....................................................    23
NTIA:
    Appropriation Language.......................................    98
    Public Safety Interoperable Communications Grant Program.....   110
Patent and Trademark Office:
    Allowance Versus Patent Rejection............................   113
    Examination Quality..........................................    97
    Remediation Plan.............................................    12
Promoting Innovation.............................................    12
Reauthorization of the NOAA Corps................................   112
Retention Rate...................................................    94
Security of Personally Identifiable Information on Laptops and 
  Other Portable Devices.........................................   111
Special Bill Language............................................    80
Staffing Breakout................................................    87
Survey of Income and Program Participation.......................   104
Technology Administration Staffing and Unobligated Balances......    97
Timeline for Achieving Strategic Plan Goals and Objectives.......    95
2010 Census:
    Cost Effectiveness...........................................   110
    Handheld Computers...........................................   114
United States PTO:
    Patent Backlog...............................................    94
    Report ``The Path to the Future, the Next Steps''............    13
Unobligated Balance Levels.......................................    87
Work With User Community to Evaluate Quality.....................    97
WTO:
    Appellate Body...............................................   108
    Disputes.....................................................   106

                    U.S. Patent and Trademark Office

Additional Committee Questions...................................    61
Cost of Intellectual Property Theft..............................    53
Human Capital Management Reviews.................................    54
Intellectual Property:
    Law Enforcement..............................................    52
    Theft........................................................    52
Patent and Trademark Office:
    Applications and Pendency....................................    48
    Examination Quality..........................................    53
    Retention and Training.......................................    49
Relationship with Food and Drug Administration...................    56

                         DEPARTMENT OF JUSTICE

          Bureau of Alcohol, Tobacco, Firearms and Explosives

Accomplishments..................................................   203
Additional Committee Questions...................................   248
ATF's Mission....................................................   203
Crime Gun Traces.................................................   241
Explosives.......................................................   254
Federal Firearms Licensees.......................................   250
Firearms Trafficking.............................................   205
Fiscal Year 2008 Budget Request..................................   203
Funding Shortfall................................................   252
Gangs and Gun Trafficking........................................   252
National Center for Explosives Training and Research.............   239
    Redstone.....................................................   253
Other Programs and Activities....................................   206
Project Safe Neighborhoods and Anti-gang Efforts.................   204
Tiahrt Amendment.................................................   249
Trace Data Disclosure............................................   243
Virginia Tech....................................................   240
    Situation....................................................   236

                    Drug Enforcement Administration

Additional Committee Questions...................................   248
Cocaine..........................................................   260
DEA:
    NM Resources.................................................   287
    State and Local Assistance...................................   256
Despite the Accomplishments, the Challenges Remain...............   217
Drug Use.........................................................   268
Enforcement Successes Over the Last 12 Months....................   213
Financial Investigations.........................................   274
Fiscal Year 2008 Budget Request..................................   217
Hiring Freeze....................................................   245
International Drug Issues........................................   262
Internet.........................................................   278
Marijuana........................................................   286
MET Program......................................................   283
Methamphetamine...........................................264, 272, 288
    Labs in Alaska...............................................   243
Prescription Drug Abuse..........................................   257
Salaries and Expenses Account....................................   217
Southwest Border and Meth Enforcement Initiative.................   246
Surveillance.....................................................   282
Teenage Drug Use is Down.........................................   212
United States/Mexico Collaboration...............................   284

                    Federal Bureau of Investigation

Additional Committee Questions...................................   323
Background Checks to Investigate Crime...........................   319
Budget Request...................................................   313
Child Pornography................................................   304
Combating Terrorism............................................303, 306
COPS Program.....................................................   318
Defeating Foreign Intelligence Operations........................   308
Foreign Intelligence Operations..................................   304
Guns to Terrorists...............................................   319
Indian Country Methamphetamine Problems..........................   340
Infrastructure and Information Technology........................   305
Integrated Wireless Network......................................   326
Intellectual Property Enforcement................................   327
Intelligence Analysts............................................   320
Internet Crime...................................................   341
National Security Letters......................................312, 328
Political Landscape ``Informational Briefings'' by White House 
  for Senior Government Officials................................   339
Preventing the Acquisition of Weapons of Mass Destruction (WMD)/
  Render Safe....................................................   307
Privacy/DNA Sampling.............................................   329
Reduce Child Exploitation and Violent Crimes.....................   308
Sentinel.......................................................314, 323
    Contractors Involved in Virtual Case File....................   316
Strengthening Infrastructure and Information Technology..........   309
Terrorism........................................................   311
Training at Quantico.............................................   321
2008 Budget Request..............................................   306
``Unfunded FTE'' Reduction.......................................   309
Violent Crime.............................................310, 316, 324
Weapons of Mass Destruction......................................   304

                     United States Marshals Service

Adam Walsh.......................................................   290
Adam Walsh Child Protection and Safety Act.......................   232
Additional Committee Questions...................................   248
Fiscal Year 2008 Budget Request..................................   229
Former Marshal's Daughter Heroic Efforts in Campus Shooting......   293
Fugitive Investigations..........................................   233
Gangs............................................................   292
Gulf Coast Task Force............................................   289
High-threat Trial Security.......................................   231
Homeland Build Up................................................   292
Judicial Threat Intelligence and Investigations..................   229
Marshals D.C. Superior Court.....................................   291
Southwest Border Enforcement.....................................   232
Summary of Fiscal Year 2006 Accomplishments......................   228
The Mission of the United States Marshals Service................   228
2007 Global War on Terror Supplemental...........................   235
Witness Security Program.........................................   234

                EQUAL EMPLOYMENT OPPORTUNITY COMMISSION

Additional Committee Questions...................................   369
Backlogs.........................................................   369
BRAC in Maryland.................................................   374
Downsizing Baltimore Office......................................   363
EEOC:
    Oversight of EEO Offices.....................................   373
    Fiscal Year 2008 Budget Request..............................   349
Funding..........................................................   362
Headquarters Relocation Plans....................................   367
National:
    Call Center..................................................   366
    Contact Center and Repositioning.............................   352
Office Closures..................................................   354
Repositioning Plan.............................................355, 360
Salvation Army Litigation........................................   357

             NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

Aging National Aeronautics and Space Administration 
  Infrastructure.................................................   182
American Competitiveness Initiative..............................   191
Chinese ASAT Test................................................   192
Earth Observing Sensors..........................................   179
Education Program................................................   183
Hubble Space Telescope...........................................   179
Independent Program Analysis Organization........................   190
Manned Flight of Orion Vehicle...................................   181
Math and Science Institutions....................................   187
National Academy of Sciences Report on Earth Science.............   193
Orion Crew Return Vehicle/Ares Launch Vehicle....................   189
Precursor Program for Lunar Exploration..........................   181
Propulsion Research and Development..............................   182
Ranking Member Shelby Closing Remarks............................   195
Science, Technology, Engineering and Mathematics (STEM)..........   184
Space Shuttle Retirement.........................................   188
Status of the Exploration Activities.............................   192

                      NATIONAL SCIENCE FOUNDATION

Experimental Program to Stimulate Competitive Research (EPSCoR)..   140
    Program Enhanced.............................................   148
International Polar Year and the Alaska Region Research Vessel...   143
National Science Foundation:
    Days.........................................................   147
    Education Programs and American Competitiveness Initiative...   137
    Facility Funding.............................................   149

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