[Senate Hearing 110-517]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 110-517
 
                    WATER ISSUES IN THE GREAT PLAINS

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

                                HEARING

                               before the

                    SUBCOMMITTEE ON WATER AND POWER

                                 of the

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                                   TO

RECEIVE TESTIMONY ON THE BUREAU OF RECLAMATION'S IMPLEMENTATION OF THE 
  RURAL WATER SUPPLY ACT OF 2006, AND THE STATUS OF IMPLEMENTATION OF 
       AUTHORIZED RURAL WATER PROJECTS IN THE GREAT PLAINS REGION

                               __________

                     SIOUX FALLS, SD, MAY 27, 2008


                       Printed for the use of the
               Committee on Energy and Natural Resources



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               COMMITTEE ON ENERGY AND NATURAL RESOURCES

                  JEFF BINGAMAN, New Mexico, Chairman

DANIEL K. AKAKA, Hawaii              PETE V. DOMENICI, New Mexico
BYRON L. DORGAN, North Dakota        LARRY E. CRAIG, Idaho
RON WYDEN, Oregon                    LISA MURKOWSKI, Alaska
TIM JOHNSON, South Dakota            RICHARD BURR, North Carolina
MARY L. LANDRIEU, Louisiana          JIM DeMINT, South Carolina
MARIA CANTWELL, Washington           BOB CORKER, Tennessee
KEN SALAZAR, Colorado                JOHN BARRASSO, Wyoming
ROBERT MENENDEZ, New Jersey          JEFF SESSIONS, Alabama
BLANCHE L. LINCOLN, Arkansas         GORDON H. SMITH, Oregon
BERNARD SANDERS, Vermont             JIM BUNNING, Kentucky
JON TESTER, Montana                  MEL MARTINEZ, Florida

                    Robert M. Simon, Staff Director
                      Sam E. Fowler, Chief Counsel
              Frank Macchiarola, Republican Staff Director
             Judith K. Pensabene, Republican Chief Counsel
                                 ------                                

                    Subcommittee on Water and Power

                  TIM JOHNSON, South Dakota, Chairman

BYRON L. DORGAN, North Dakota        BOB CORKER, Tennessee
RON WYDEN, Oregon                    LARRY E. CRAIG, Idaho
MARIA CANTWELL, Washington           JIM DeMINT, South Carolina
KEN SALAZAR, Colorado                JOHN BARRASSO, Wyoming
BLANCHE L. LINCOLN, Arkansas         GORDON H. SMITH, Oregon
JON TESTER, Montana                  JIM BUNNING, Kentucky

   Jeff Bingaman and Pete V. Domenici are Ex Officio Members of the 
                              Subcommittee

                            C O N T E N T S

                              ----------                              

                               STATEMENTS

                                                                   Page

Bordeaux, Rodney, Rosebud Sioux Tribe, Rosebud, SD...............    28
Fitzgerald, Jake, Manager, West River/Lyman-Jones Rural Water 
  Systems, Murdo, SD.............................................    33
Jandreau, Michael, Chairman, Lower Brule Sioux Tribe, Lower 
  Brule, SD......................................................    32
Johnson, Hon. Tim, U.S. Senator From South Dakota................     1
Larson, Troy, Executive Director, Lewis & Clark Regional Water 
  System, Sioux Falls, SD........................................    18
Munson, Dave, Mayor, Sioux Falls, SD.............................    15
Ryan, Michael, J., Great Plains Regional Director, Bureau of 
  Reclamation, Department of the Interior........................     4
Steele, John, President, Oglala Sioux Tribe, Pine Ridge, SD......    22
Tester, Hon. Jon, U.S. Senator From Montana......................     2


                    WATER ISSUES IN THE GREAT PLAINS

                              ----------                              


                         TUESDAY, MAY 27, 2008

                               U.S. Senate,
                   Subcommittee on Water and Power,
                 Committee on Energy and Natural Resources,
                                                   Sioux Falls, SD.
    The subcommittee met, pursuant to notice, at 2 p.m. at Best 
Western Ramkota Hotel and Conference Center, 3200 W. Maple 
Street, Hon. Tim Johnson, presiding.

OPENING STATEMENT OF HON. TIM JOHNSON, U.S. SENATOR FROM SOUTH 
                             DAKOTA

    Senator Johnson. I call to order this field hearing before 
the Energy and Natural Resources Water and Power Subcommittee. 
It is my pleasure to welcome everyone here today.
    I appreciate John Tester, who is from Montana, traveling to 
Sioux Falls to attend today's hearing. I know that Senator 
Tester is interested in the topics to be covered today, and I 
believe he will add a valuable perspective to water development 
in the Great Plains.
    I also want to thank all the witnesses for traveling to 
Sioux Falls and being available to present testimony and answer 
questions.
    The purpose of today's hearing is to receive testimony on 
the Bureau of Reclamation's implementation of the Rural Water 
Supply Act of 2006 and to examine the implementation and status 
of the water supply projects in the Great Plains.
    The Great Plains face great water demands for adequate 
drinking water supplies. Population growth and economic 
development will further strain the gap between capital 
improvements needed for public water systems and the capability 
of governments to finance these new projects. Unfortunately 
under investment is not the only problem.
    Millions of Americans left without safe and reliable 
drinking water. Many of these individuals are served by small 
community systems. But regionally, our regionalized approach 
that water delivery could be more effective to distribute 
drinking water.
    To better address the outstanding drinking water needs of 
these communities the Congress passed the Rural Water Supply 
Act of 2006. Now for the first time, the BOR has a water supply 
plan to construct new water development projects. We need to 
get this program up and running. I look forward to Regional 
Director Ryan updating the committee on this implementation.
    The second part of today's hearing is to receive testimony 
on construction of ongoing water projects in the Great Plains 
region. I am proud that South Dakota was the first State to 
harness the resources of the BOR to construct these regional 
water projects. Since the year 2003, I have helped secure about 
$347 million of Federal funds for the construction and 
operation and maintenance of South Dakota's BOR drinking water 
projects. These projects are an example of how our partnership 
between the Federal and State governments and local sponsors 
can set the conditions for building our communities.
    Currently South Dakota has three ongoing projects in 
various stages of completion that serve diverse and private 
communities: the Lewis and Clark Regional Water System, Mni 
Wiconi Rural Water System, and the Perkins County Rural Water 
System. Unfortunately the continued progress and construction 
of these projects is threatened by the lack of support for 
funding from the current Administration. The BOR's decision to 
recommend no funds in next year's budget for Lewis and Clark, a 
regional solution for water supplies in several Eastern South 
Dakota communities including Minnesota and Iowa, is simply 
unacceptable. I'm sure that today's witnesses will touch on the 
impacts of these cuts.
    We're also making progress. Some systems are now completed 
and delivering water for municipal, agricultural and industrial 
purposes with other projects such as the Mni Wiconi near 
completion. We have several witnesses from these projects 
testifying today that can further explain their importance of 
seeing these projects completed.
    We have a full panel of witnesses today. So with that, I 
would like to recognize my colleague from Montana for his 
opening statement. Senator Tester, please go right ahead with 
your remarks.

          STATEMENT OF HON. JON TESTER, U.S. SENATOR 
                          FROM MONTANA

    Senator Tester. I want to thank you, Senator Johnson. I am 
truly happy to be here today in Sioux Falls. I appreciate your 
leadership in holding this hearing because water is arguably 
the most important issue that faces the Great Plains and the 
West, especially here in South Dakota and also in Montana.
    I know that you have worked very hard on water issues in 
South Dakota for a long, long time. In a lot of ways in Montana 
we want to follow in your footsteps trying to get some of our 
rural water projects developed.
    I also appreciate Michael Ryan coming in today. I 
appreciate your sacrifice being here today, Mike. I look 
forward to your testimony.
    Unfortunately it seems like when it comes to these projects 
that folks with the biggest water problems are often those that 
are least able to finance them. We've got the greatest country 
in the world. Nobody should have to worry about safe, clean, 
affordable drinking water. Yet a lot of people do.
    Like South Dakota, Montana also has three Bureau of Rec 
projects that are in various stages of completion. All of them 
involve tribal nations. All of them have been voted on and 
approved by Congress. And Each one of them is badly needed. But 
in the last several years, none of them have ended up in the 
President's budget.
    Congress passed the Rural Water Supply of 2006 to clarify 
the role of the Bureau of Reclamation in developing rural water 
supply projects. The bill is supposed to lay out a plan to 
finish authorized projects and put down some guidelines for the 
projects into the future. I anxiously look forward to the 
report that is expected out later this year.
    But in the short term one thing that I am sure about is 
that these projects will never get completed if they aren't 
funded at a level that is adequate. In Montana, the St. Mary's 
Canal Project was built for irrigation purposes nearly 100 
years ago. Twenty thousand people depend upon it for drinking 
water.
    The Canal is in such bad shape that failure is going to 
happen. It's just when. If that canal goes, 20,000 people are 
immediately cutoff from water, and the Blackfeet Reservation, 
where the project is, has an environmental catastrophe on their 
hands.
    The Fort Peck-Dry Prairie System, another system, is in a 
race against time with a brine plume from old gas and oil 
production that is moving in the ground water toward the town 
of Poplar. Without this Fort Peck-Dry Prairie Water System 
getting up and running very, very soon that brine water is 
going to poison those folks as well, those folks' water wells.
    The water around the north central water system, Rocky 
Boy's-North Central Water System is so bad that the EPA tells 
tribal members not to drink it. But the Federal Government 
hasn't been helping them finish their system that would bring 
much needed relief.
    Mr. Ryan, I don't envy the position you are put in. I know 
there are incredible demands put upon you. I know you fully 
realize the importance of these projects to the region. But 
we're also relying on you to work with the Bureau of 
Reclamation to make clear the importance of rural water 
projects to Reclamation States and a plan for their completion.
    I look forward to your testimony. Of course, we'll have 
some questions about South Dakota and Montana and other 
Reclamation States. How we finish up our ongoing projects and 
get some new ones started so our constituents can be guaranteed 
safe, clean, affordable drinking water.
    Once again, I do want to thank Senator Johnson for his 
leadership and for holding this field hearing. I look forward 
to the testimony. I too will have some questions.
    Senator Johnson. Thank you, Senator Tester. We will now 
turn to the first witness for today's hearing. Representing the 
Bureau of Reclamation is Michael Ryan, a Regional Director for 
the Great Plains Region of the BOR. Welcome to Sioux Falls, Mr. 
Ryan and I appreciate your making yourself available.
    What I would like to do is from Mr. Ryan to deliver his 
statement after which Senator Tester and I will ask Mr. Ryan 
some questions. Once that is complete, we will go onto the next 
group of witnesses.
    That testimony as well as the written submission of all 
today's witnesses will be made part of the official hearing 
record.
    Mr. Ryan, please go ahead with your statement. Following 
that we'll have a question and answer period for you.

 STATEMENT OF MICHAEL J. RYAN, GREAT PLAINS REGIONAL DIRECTOR, 
       BUREAU OF RECLAMATION, DEPARTMENT OF THE INTERIOR

    Mr. Ryan. Thank you. Good afternoon, Mr. Chairman, Senator 
Tester and staff. My name is Mike Ryan. I am the Regional 
Director for the Great Plains region for the Bureau of 
Reclamation. I am pleased to provide the Department of the 
Interior's views today on the status of rural water projects in 
the Great Plains region and a report on Reclamation's 
implementation of the Rural Water Supply Act of 2006.
    This region has a total of six authorized rural water 
projects with an estimated remaining Federal cost of 
approximately $1.3 billion to complete them. Reclamation 
allocates funding for its rural water projects based on 
objective criteria which give priority to projects nearest to 
completion and that serve tribal needs. The fiscal year 2009 
budget request reflects Reclamation's attempt to balance the 
many competing priorities for funding within the Federal 
Government and within Reclamation.
    Prior to the Rural Water Supply Act, Congress authorized 
several rural water projects. Funding in the amount of $39 
million is included in the fiscal year 2009 President's budget 
request for some of these rural water projects, specifically 
Mni Wiconi and the Garrison Diversion Unit. These rural water 
projects are separate and distinct from any projects that may 
be authorized in the future under the Act. Detailed information 
about the funding history and remaining amounts needed for 
completion of each of these six projects is included in my 
written statement. I will be happy to answer questions about 
any of these projects.
    Now allow me to provide a status report on implementation 
of the Rural Water Supply Act of 2006. Reclamation's intention 
is to work cooperatively with rural communities across the West 
in a consistent manner to identify rural water supply needs and 
cost effective options for addressing those needs. Prior to 
enactment of this legislation Reclamation had no authority to 
get involved early in the process in the analysis and 
development of solutions for meeting the potable water supply 
needs of rural communities in the West.
    We are working hard to implement this new program in a 
timely manner. Our focus is to ensure a thorough analysis of 
rural water needs and options to address those needs through 
the completion of appraisal and feasibility studies. As studies 
are completed Reclamation is required to submit a feasibility 
report to Congress and to make a recommendation as to whether 
the project is technically and economically feasible.
    Further, the report must make a recommendation on whether 
Congress should authorize Federal involvement and construction 
of the project. The report must also make a recommendation on 
the appropriate non-Federal share of construction costs which 
must be at least 25 percent of the total construction costs. 
While we expect great interest in this program, Reclamation 
will not be able to get involved in every project that is 
presented to us as any efforts to implement projects under this 
program must compete with other Reclamation projects for finite 
resources.
    The Act envisioned the establishment of consistent and 
objective criteria to help make those choices. Reclamation is 
currently working to establish programmatic and eligibility 
criteria for participation in the program and prioritization 
criteria to articulate how Reclamation will select projects to 
support. The Act requires that we promulgate and publish the 
program's rules and criteria in the Federal Register. This is 
being done through a rulemaking process in accordance with the 
Administrative Procedure Act. Will provide opportunities for 
public review, involvement and comment prior to being 
finalized.
    We anticipate publishing the rule in the Federal Register 
this year. The President's fiscal year 2009 budget request 
includes $1 million for Administrative work for the program. 
That funding would allow us to begin to work with communities 
on study proposals and then carry out and support studies that 
are selected based on the criteria.
    During our initial efforts to scope this program we have 
held conversations with various stakeholder groups throughout 
the West. Also, as part of the rulemaking process, we plan to 
hold public and tribal meetings to gather comments and answer 
questions. We will continue that outreach and dialog throughout 
the process of implementing this new program.
    We see this program as an opportunity to provide a clearly 
defined process for Reclamation and rural communities 
throughout the West to work together to identify options for 
meeting potable water supply needs in a technically feasible, 
environmentally responsible and cost effective manner. With all 
of this work underway we look forward to working closely with 
the large base of stakeholders on implementation.
    Thank you for the opportunity to appear today. This 
concludes my verbal remarks. I am pleased to answer any 
questions.
    [The prepared statement of Mr. Ryan follows:]

Prepared Statement of Michael J. Ryan, Great Plains Regional Director, 
           Bureau of Reclamation, Department of the Interior

    Good afternoon Mr. Chairman and Members of the Subcommittee. My 
name is Mike Ryan and I am the Regional Director for the Great Plains 
Region for the Bureau of Reclamation. I am pleased to provide the 
Department of the Interior's views today on the status of major 
authorized rural water projects in the Great Plains Region, and 
separately, report on Reclamation's implementation of Title I of Public 
Law 109-451.
    Reclamation is proceeding with the design or construction of 
several rural water projects in the Great Plains region. Below is a 
summary on the status of the major projects under consideration by the 
Subcommittee today. While my testimony today includes specific 
reference to these major projects, I think it is important to note that 
the Great Plains Region has a total of six authorized rural water 
projects with an estimated remaining Federal cost of approximately $1.4 
billion to complete these six projects. Finally, my statement concludes 
with a status on the newly authorized rural water program under 
development this year.
    Before discussing the individual projects, it is important to note 
that the Bureau of Reclamation allocates funding for its rural water 
projects based on objective criteria, which gave priority to projects 
1) nearest to completion; and 2) that serve tribal needs. These 
projects also received funding based on amounts needed for ongoing 
work. The FY 2009 budget request reflects Reclamation's attempt to 
balance the many competing priorities for funding within the Federal 
Government and within Reclamation.
    Prior to the authorization of the ``Rural Water Supply Act,'' 
Congress authorized several individual rural water projects. Funding in 
the amount of $39 million is included in the FY 2009 President's budget 
request for some of these rural water projects, which are separate and 
distinct from any projects that may be authorized under the Act.

                             LEWIS & CLARK

    The Lewis & Clark Rural Water System was authorized in the 106th 
Congress by P.L. 106-246. Construction activities began in 2004. The 
project has expended over $75 million, and was approximately 23 percent 
complete as of September 30, 2007. Funds have been used for 
preconstruction activities, including National Environmental Policy Act 
(NEPA) and National Historic Preservation Act compliance, Value 
Engineering studies, field data collection, and preparation of plans 
and specifications. Lewis & Clark has constructed 50 miles of the 61 
mile main transmission pipeline in South Dakota, 8 miles of raw water 
pipeline and 9 miles of treated water pipeline in Iowa. Six wells were 
installed in the Mulberry Point Well Field with associated facilities 
and bank stabilization commencing this year. The Federal cost ceiling 
(FY 2008) is $362 million and the corresponding non-Federal cost-share 
is $100 million for a total project cost of $462 million. As of January 
1, 2008, Federal appropriations totaled $101 million with a remaining 
Federal balance of approximately $261 million. When completed, Lewis & 
Clark will address regional concerns regarding the low quality, 
contamination vulnerability, and insufficient supply of existing 
drinking water sources throughout the project area. Currently, 20 
existing water utilities are members of Lewis & Clark, which will 
eventually serve more than 300,000 people in South Dakota, Minnesota, 
and Iowa.

                     MID-DAKOTA RURAL WATER SYSTEM

    The Mid-Dakota Rural Water System, P.L. 102-575, Title XIX, dated 
October 30, 1992, authorized the construction of the Mid-Dakota Rural 
Water System. The Mid-Dakota Rural Water System utilizes water pumped 
from an intake located on Oahe Reservoir. The project brings a 
dependable supply of good quality drinking water to more than 29,000 
people and more than 600,000 head of livestock. More than 3,000 rural 
water users and 17 cities have paid good intention fees to be included 
in the system. A wetland component is included in the project and is 
being funded by a Federal grant. The Mid-Dakota project was completed 
in FY 2006. Total Federal cost of the project was $148 million.

                               MNI WICONI

    The Mni Wiconi Rural Water Supply Project was authorized under P.L. 
100-516 and other authorizations to serve three Indian Reservations and 
one non-Indian sponsor in South Dakota. The Indian sponsors are the 
Oglala, Rosebud and Lower Brule Sioux Tribes and the non-Indian sponsor 
is West River Lyman-Jones. The sunset date for the project has been 
extended to the end of 2013. In addition to the annual construction 
costs, as facilities are completed additional funds are required to 
support Tribal operation and maintenance (O&M) activities, since P.L. 
100-516 required that the operations and maintenance of the tribal 
components be a Federal obligation. The FY 2009 budget for construction 
is over $16 and $10 million for O&M. Mni Wiconi is one of two rural 
water projects included in the FY 2009 President's Budget Request. The 
Federal cost ceiling (FY 2008) is $452 million with a corresponding 
non-Federal cost-share of $17 million. As of January 1, 2008, Federal 
appropriations totaled $360 million with a remaining Federal balance of 
approximately $92 million. The project was approximately 74 percent 
complete as of September 30, 2007. The project will serve 40,000 on-
reservation, as well as 12,000 off-reservation residents.
    The project was initially authorized for construction through 2003, 
based on projected appropriations. In 2002, the Act was amended to 
extend the sunset date to 2008 and to authorize an additional $58 
million to cover costs not considered in the original authorization as 
well as the added administrative costs for a five year extension. Since 
the project was not completed by the amended date of 2008, Congress 
extended the sunset date again, this time to 2013 through enactment of 
P.L. 110-161.

               NORTHWEST AREA WATER SUPPLY PROJECT (NAWS)

    The NAWS project is a component of the larger Garrison Diversion 
Unit. The rural water component in North Dakota was authorized by the 
Garrison Diversion Unit Reformulation Act of 1986. The authorizing 
legislation established two rural water components--the State 
maintenance rehabilitation and improvement (MR&I) grant program and the 
Tribal MR&I program--both of which have been under construction since 
the late 1980s. The Tribes included in the authorization are the 
Standing Rock Sioux, the Three Affiliated Tribes, the Spirit Lake 
Sioux, and the Turtle Mountain Band of Chippewas. The NAWS project is a 
component of the State MR&I addition to the Garrison Unit and when 
complete will deliver water from the Missouri River to communities and 
rural water systems in North Dakota located in the Hudson Bay Basin. 
Construction of NAWS began in April 2002, but was halted as a result of 
litigation filed by the Province of Manitoba, alleging that the 
environmental review under NEPA was insufficient.
    In response to that complaint, in March 2006 Reclamation initiated 
the preparation of an environmental impact statement (EIS). The focus 
of the EIS is to evaluate additional water treatment alternatives that 
could further reduce the risks of transfer of non-native species from 
the Missouri River Basin to the Hudson Bay Basin. Treatment would take 
place within the Missouri River Basin and two of the four alternatives 
would meet treatment goals recommended by the Province of Manitoba, 
Canada. Increased costs of the newly considered alternatives range from 
approximately $10 million to $90 million. The United States is 
responsible for both construction and operation and maintenance of the 
treatment plant. A Federally preferred alternative has not been 
identified in the draft EIS.
    The draft EIS was issued for a 60 day public review and comment in 
December 2007, which was later extended to March 26, 2008. Three public 
hearings were held to receive testimony from the public. All comments 
received will be considered in preparing the final EIS. At this time 
Reclamation anticipates completing the final EIS by the end of the 
calendar year. Upon completion of the final EIS a record of decision 
will be prepared.
    The authorizing legislation requires that the Secretary make a 
determination on adequate treatment to meet requirements of the 
Boundary Waters Treaty in consultation with the Environmental 
Protection Agency and the State Department. Reclamation will continue 
working with these agencies on a recommendation for a Secretarial 
determination that includes an appropriate treatment process.
    The Federal cost ceiling for the State component (FY 2008) is $461 
million with a corresponding non-Federal cost-share of approximately 
$154 million. For this component of the project, as of January 1, 2008, 
Federal appropriations totaled $230 million with a remaining Federal 
balance of $231 million. The Federal cost ceiling for the Tribal 
component (FY 2008) is approximately $311 million with no non-Federal 
cost-share. From the same date, Federal appropriations for this 
component totaled $80 million with a remaining Federal balance of $230 
million. The project was approximately 61 percent complete as of 
September 30, 2007.

                             PERKINS COUNTY

    The Perkins County Rural Water System Act of 1999, P.L. 106-136, 
dated December 7, 1999 authorized $15 million for the construction of 
the Perkins County Rural Water System (PCRWS). The PCRWS is a buried, 
pressurized pipeline distribution system that delivers treated drinking 
water to communities, rural residences and pasture taps in Perkins 
County, South Dakota. Perkins County is the second largest county 
(2,866 square miles) in South Dakota and is located in the northwest 
corner of the State. The area is characterized by widely separated 
towns and ranches. Groundwater has been the predominant water source, 
but many residents of the area haul water for domestic use because of 
inadequate quantity and poor water quality. The PCRWS will purchase 
treated water from the Southwest Pipeline Project (SWPP) in North 
Dakota and distribute that water to its customers through a network 
consisting of 515 miles of pipe, 5 booster stations, and 3 storage 
reservoirs. The SWPP was constructed as a feature of the Garrison 
Diversion Unit under the State MR&I program.
    The Federal cost ceiling (FY 2008) is over $24 million with a 
corresponding non-Federal cost-share of $8 million. As of January 1, 
2008, Federal appropriations totaled approximately $14 million with a 
remaining Federal balance of approximately $11 million. The system was 
approximately 65 percent complete as of September 30, 2007.

                         FORT PECK/DRY PRAIRIE

    The Fort Peck Reservation Rural Water System Act of 2000 (P. L. 
106-382) authorized $287 million (FY 2008) for the construction of the 
Fort Peck Reservation Rural Water System (FPRRWS). The Fort Peck Tribes 
(Tribes) and the non-Indian Dry Prairie Water Authority (DPWA) are the 
project sponsors. Public Law 106-382 authorizes the appropriation of 
the funds over a period of 10 years. Reclamation has a cooperative 
agreement with DPWA under the Federal Grants and Cooperative Agreements 
Act for the construction of the off-reservation portion of the system. 
Reclamation has a cooperative agreement with the Tribes under Title I 
of P.L. 93-638 for the construction of the reservation portion of the 
system and the water treatment plant and transfers funds each year 
through an annual funding agreement under that cooperative agreement. 
The Federal cost ceiling (FY 2008) is approximately $263 million with a 
corresponding non-Federal cost-share of $24.512 million. As of January 
1, 2008, Federal appropriations totaled $48 million with a remaining 
Federal balance of approximately $215 million. The project was 
approximately 16 percent complete as of September 30, 2007.

         NORTH CENTRAL MONTANA/ROCKY BOYS REGIONAL WATER SYSTEM

    The Rocky Boys/North Central Montana Regional Water System Act, 
P.L. 107-331, dated December 13, 2002, authorized the construction of 
the North Central Montana Regional Water System, in coordination with 
the Chippewa Cree Tribe (Tribe) and the North Central Montana Regional 
Water Authority (Authority). The Rocky Boy's/North Central Montana 
Regional Water System will serve an estimated population of 43,000 at 
full build-out. Operation, maintenance, and replacement for the core 
and on-Reservation systems will be funded by a $20 million trust fund 
through Bureau of Indian Affairs appropriations. The non-Tribal systems 
will fund their operation, maintenance, and replacement separately 
without Federal assistance. The Federal cost ceiling (FY 2008) is $273 
million with a corresponding non-Federal cost share of $36 million. As 
of January 1, 2008, Federal appropriations totaled approximately $15 
million with a remaining Federal balance of approximately $258 million. 
The project was approximately 5 percent complete as of September 30, 
2007.

                          RURAL WATER PROGRAM

    I would now like to provide a status report on Reclamation's 
implementation of Title I of Public Law 109-451, the Rural Water Supply 
Act of 2006.
    In December 2006, the Rural Water Supply Act of 2006 (Act) was 
enacted and signed into law. Title I of this Act authorizes the 
Secretary of the Interior to create a rural water supply program 
(Program) to address rural water needs in the 17 Western United States. 
The intent of this Program is to enable Reclamation to work 
cooperatively with rural communities across the West in a consistent 
manner to identify rural water supply needs and cost effective options 
for addressing those needs. Prior to enactment of this legislation, 
Reclamation had no authority to get involved--early in the process--in 
the analysis and development of solutions for meeting the potable water 
supply needs of rural communities in the West. We are working hard to 
implement this new Program in a timely manner.
    Title I of the Act requires Reclamation to: (1) develop 
programmatic criteria determining eligibility for non-Federal entities 
to participate in the Program and for prioritizing requests for 
assistance; (2) develop criteria for what must be included in both the 
appraisal and the feasibility studies that are to be completed under 
the Program, in terms of data, alternatives, and level of analysis; (3) 
complete an assessment of the rural water programs that exist in other 
Federal agencies to ensure that we are filling an unmet niche and to 
ensure that we coordinate with other agencies and leverage resources; 
and (4) complete an annual report of Reclamation's staff costs for 
carrying out the Act. The assessment also will include a report on the 
status of rural water projects that are already authorized for 
involvement by the Bureau of Reclamation. As we have begun to work on 
implementation of this Program, there was some confusion among some of 
our customers and stakeholders about the Program's scope. I would like 
to address that issue with the Committee.
    Title I of P.L. 109-451 authorized Reclamation to complete 
appraisal and feasibility studies for rural water projects in the 17 
western states. It does not authorize the design and construction of 
those projects.
    The focus of the Program is to ensure that there is thorough 
analysis of rural water needs and options to address those needs 
through the completion of appraisal and feasibility studies that meet 
program criteria. As studies are completed, Reclamation is required to 
submit a feasibility report to Congress. In the report, the Secretary 
(through Reclamation) will make a recommendation as to whether the 
project is technically and economically feasible, and whether the 
project is in the Federal interest. Further, the report must make a 
recommendation on whether Congress should authorize Federal involvement 
in construction of the project. The report must also make a 
recommendation on the appropriate non-Federal share of construction 
costs, which must be at least 25 percent of the total construction 
costs. Reclamation is committed to working with its customers, states, 
tribes, and other stakeholders to find ways to balance and provide for 
the mix of water resource needs in the future to meet their 
responsibilities.
    While we expect great interest in this program, Reclamation will 
not be able to get involved in every project that is presented to us, 
as any efforts to implement projects under this program must compete 
with other Reclamation projects for finite resources. The Act 
envisioned the establishment of consistent and objective criteria to 
help make those choices. As such, before the Rural Water Program can be 
implemented, the Secretary (through Reclamation), must establish 
programmatic and eligibility criteria for participation in the Program 
and prioritization criteria to articulate how Reclamation will select 
projects to support. The Act further requires that we promulgate and 
publish the program's rules and criteria in the Federal Register. This 
is being done through a rulemaking process in accordance with the 
Administrative Procedure Act (APA). This APA process provides 
opportunities for public review, involvement and comment and 
Reclamation plans to closely adhere to these requirements.
    We anticipate publishing the Rule in the Federal Register this 
year, and the President's FY 2009 budget request includes $1 million 
for administrative work for the program. That funding would allow us to 
begin to work with communities on study proposals and then begin to 
carry out and support studies that are selected based upon the 
programmatic and prioritization criteria.
    During our initial efforts to scope this Program, we have held 
conversations with various stakeholder groups throughout the West. 
Also, as part of the rulemaking process, we plan to hold public and 
tribal meetings to gather comments and answer questions. We will 
continue that outreach and dialogue throughout the process of 
implementing this new Program.
    We see this Program as an opportunity to provide a clearly defined 
process for Reclamation and rural communities throughout the West to 
work together to identify options for meeting potable water supply 
needs in a technically feasible, environmentally responsible, and cost 
effective manner. P.L. 109-451 gives Reclamation authority to review, 
evaluate, and make recommendations to the Congress regarding the 
feasibility of proposed rural water projects such as the ones discussed 
here today.
    With all of this work underway, we look forward to working closely 
with the large base of stakeholders on implementation.
    Thank you for the opportunity to appear today. This concludes my 
statement. I am pleased to answer any questions from the Subcommittee.

    Senator Johnson. Thank you, Mr. Ryan. As you know prior to 
enactment the Rural Water Supply Act of 2006 authorization for 
BOR Rural Water Projects was a hopscotch of separate 
authorities tacked into Appropriation bills are missing on 
these authorization bills. For example, Lewis and Clark 
Regional Water System was added as an amendment to the Fiscal 
Year 2001 military construction Appropriations bill.
    There is apparently a need for a uniform set of criteria to 
evaluate projects along for the Bureau to recommend to the 
Congress future projects for authorization and construction. 
That was what was intended in the Rural Water Act. Please turn 
your attention to the funding chart showing the gap between the 
proposed and enacted funding for the Great Plains Water 
Projects. It is clear that recent BOR recommendations differ 
widely.
    Inconsistent budget recommendations seem to frustrate the 
Bureau's goal of construction of the municipal, rural and the 
districal water systems. Please explain how the BOR will 
achieve its goal of constructing these systems when the 
Administration's budget recommendations are so inconsistent 
from 1 year to the next.
    Mr. Ryan. Thank you, Senator. One of the things that I can 
do as an engineer is to help the policymakers understand what 
types of criteria I would bring to the selection process for 
projects or for funding proposals for projects. You see now 
that the Administration as we approach this, we have the two 
criteria that we lean on very heavily. One is how far along the 
project is to completion. The second is to what extent does 
that project help serve Native American needs.
    It's been our experience that the needs within those tribal 
communities are sometimes the most severe, the most dire of 
situations. So we use those as guidelines to get started on 
which projects to direct our funding. One of the frustrating 
things for all of us in the time that we live is that more 
money would accomplish more good things.
    In recent years Congress has enacted budgets, in addition 
to what the President has proposed or requested, and that helps 
the projects move along more quickly. I am thankful for that.
    Senator Johnson. Mr. Ryan, I think the BOR suffers from a 
perception in South Dakota that there is no rhyme or reason as 
to how budgets are formulated. In 1 year Lewis and Clark 
project is deemed a priority and is recommended to receive $15 
billion then the next year, nothing, no funding at all. This 
weakens confidence in the BOR.
    How can the BOR improve the budget process so that projects 
receive a more consistent recommended level of funding?
    Mr. Ryan. Senator, I believe that consistency does help as 
communities are planning long term, not only for what their 
needs are and how they're going to meet those needs but how 
they're going to find answers for those. That's why I do 
advocate using the criteria that we've developed to date. 
Additional criterias envisioned under the Rural Water Supply 
Act because I think that helps brings back some predictability 
to the situation.
    Another thing that we can do to help, I believe, is that as 
we understand the technical requirements on the jobs and many 
of them are site specific or project specific, working with the 
project sponsors we can help reach a meeting of the minds at 
least on the technical level of what the cash-flow requirements 
are to complete projects, do the calculations to try to get 
things done as economic and efficiently as we possibly can. In 
recent years we've been thrown a bit of a curve ball with the 
price of some of our components for constructing the systems. 
But we have to take that into account. We have to move forward.
    But my experience has been the more predictable or the more 
consistent that we can be as a partner, the better that is for 
our remaining partners as they make their plans on how to 
proceed.
    Senator Johnson. I'd like now to turn to one project in 
particular, the Mni Wiconi System. Recently you met the Oglala 
Sioux Tribe on how to improve coordination between tribal 
sponsors and the BOR. What is the quality of that relationship 
between the BOR and the tribe? How can it be improved?
    Mr. Ryan. I would characterize our relationship as very 
strong and improving. This last week when I visited with some 
representatives from the tribal membership one of the things 
that we were talking about was improving the communications by 
having more frequent, regularly scheduled sessions. Making sure 
that we're approaching things, not just in a technical aspect, 
but in a true government to government aspect.
    So we have our technical folks working together, managers 
working together and then tribal leaders and myself as the 
Administration's representative working together. It's, as I 
characterized it to someone that I work with, it's like a 
ladder. You have the rungs and you have the styles and they 
need to be working at all different levels and across, from 
side to side, in order to be effective.
    So that's something, I think, would help us, especially now 
as we're nearly finished and we have this sunset date of 2013 
to complete. So we need to make sure that we finish this race. 
We need to be strong to the finish.
    Senator Johnson. For now I would like to wrap up my 
questions for Mr. Ryan and ask Senator Tester to proceed with 
any questions he might have.
    Senator Tester. Yes, thank you, Senator Johnson. Once 
again, thanks for being here, Mike.
    Mr. Ryan. Yes, sir.
    Senator Tester. I appreciate your testimony. As per the 
Rural Water Supply Act of 2006 and that assessment, in your 
testimony you said it would be finished this year. Can you be 
more specific than that?
    Mr. Ryan. We expect, Senator, to formulate interim rules 
and regulations. Have those by the fall of this year. We still 
have to go through the more formulized, final rules and 
regulations process. But we can begin acting under the interim 
rules and regs.
    We expect to be in that situation this fall. So that as we 
get our funding for fiscal year 2009, this fall, we can hit the 
ground with our feet running.
    Senator Tester. When will it be ready for public 
consumption?
    Mr. Ryan. We've had some informal conversations with some 
of our stakeholders to date to help us as we've prepared what's 
in these interim drafts. I expect that in the late summer, 
early fall, we'll have a public draft available for review and 
comment. But I think that when people, when the larger public 
sees it, they will be impressed with the amount of effort that 
we've put into it. We're trying very hard to do a good job.
    Senator Tester. Ok. As Regional Director, you talked about 
a criteria being, percentage of completion.
    Mr. Ryan. Yes, sir.
    Senator Tester. What the impacts are on the Native 
population.
    Mr. Ryan. Yes, sir.
    Senator Tester. Are there any others? First of all, did the 
Regional Directors, play a role in general when these projects 
came down the line as far as funding levels, as far as 
recommendations?
    Mr. Ryan. Yes, sir. In the Bureau of Reclamation our budget 
requests are built from the ground up. So that people in our 
field offices, in this instance with rural water, the people in 
the field offices will visit with the project sponsors and 
develop budget requests.
    My job is then to make a recommendation to our 
Commissioner. The Commissioner will then contemplate the 
different recommendations that come to him. He makes the 
recommendation to the Secretary of the Interior. From that it 
goes to the Office of Management and Budget for preparation in 
the President's request.
    Senator Tester. Not to put you on the spot, but it would 
seem to me that they're built from the ground up. There's a lot 
of these projects that were zeroed out when they went by your 
desk.
    Mr. Ryan. As I'm sure you can appreciate, not everything I 
recommend is agreed to. But it's also, I think too fair to say 
for the process that the needs are so great that as we 
formulate the budget and I take a look at all of my needs for 
funding requests, requirements within the region, taking care 
of existing infrastructure as well as developing new water 
supply infrastructure, it calls for some very difficult 
decisions.
    Senator Tester. Yes and as I look at the chart it would 
actually--the purple is the amount that was asked for in the 
President's budget?
    Mr. Ryan. Yes, sir.
    Senator Tester. We see a decrease in that area. So it 
appears some decisions were made, I think, at a different level 
that has it at a different priority. You don't have to answer 
that. That's just my opinion.
    Mr. Ryan. Thank you.
    Senator Tester. Do you feel that the input you have is 
sufficient to ensure that these projects will be done in a 
timely manner?
    Mr. Ryan. I believe, beginning with our Commissioner and 
going up through the Department and into OMB, that the 
information that we're able to provide and their visits with 
the project sponsors helps them to make as informed decisions 
as possible. We try very hard to interpret sometimes complex 
technical issues into, you know, real world language so that 
they can make as an informed decision as they can.
    Senator Tester. Let's go back to this Rural Water Supply 
Act 2006. Once it gets done and we're able to utilize it in 
next year's budget, do you think it will have significant 
impacts on funding levels for projects?
    Mr. Ryan. I think that it has the potential, Senator. 
Because I believe that it will bring to the public eye 
something that several folks believe they see right now in that 
the need is great for systems like this and in places in 
addition to the projects that have been authorized to date. I 
believe that will take some people aback when they see what the 
needs are.
    Senator Tester. Ok. I mean one of the reasons I asked that 
question, and I think it's been alluded to here several times 
this afternoon, is that some of these funding levels aren't 
even keeping up with inflation.
    Mr. Ryan. That's right.
    Senator Tester. So if there isn't more of a priority put on 
them within the budget they'll never get completed.
    Mr. Ryan. Right.
    Senator Tester. So that's really the issue. I mean, we've 
invested some real dollars in some real projects in both North 
and South Dakota and in Montana and quite frankly if these 
funding levels continue the way they are, at least in this 
region we're losing ground, not gaining.
    Mr. Ryan. With the cost of indexing, you know, the rising 
cost of the materials needed to construct the systems. It's 
very difficult to make head way.
    Senator Tester. Yes. That's probably not going to change 
much, with the price of fuel at four bucks. New projects. Are 
you going to be recommending new projects?
    Mr. Ryan. Right. What we'll do is work through the process 
that the legislation envisions in doing either appraisal or 
feasibility studies and then make the report to Congress. I 
would envision that some of the reports to Congress will be 
favorable and some will be not. But I think it would be pre-
decisional right now for me to try and select which ones would 
be.
    We know we need to do our work and go through them and 
scrub thenumbers and be able to make our recommendation to the 
Congress.
    Senator Tester. Yes, ok. I just wondered with the way the 
dollars are going, unless there's more of an emphasis on these 
projects. Trust me, we've got projects in Montana that have not 
been approved yet that are critically important. But how do you 
get to a point where you can fund the old ones and take care of 
the new ones?
    Mr. Ryan. Yes, sir. It's a challenge.
    Senator Tester. Just a second here, real quick. You've got 
a loan guarantee program. What's the status of that?
    Mr. Ryan. In the second title within the Rural Water Supply 
Act had to do with the Loan Guarantee Program. The Bureau of 
Reclamation prepared the rules and regulations, drafted the 
rules and regulations for implementing the loan program. They 
were submitted to the Office of Management and Budget in May 
2007, so about a year ago.
    The Office of Management and Budget had some differences 
with Reclamation and the Department of the Interior about how 
many dollars in Appropriations would need to be made in order 
to effectuate the program. So Reclamation, Interior and OMB 
right now are sitting down trying to come to a common 
understanding of what those rules and regs should be so we can 
get them out and get going.
    Senator Tester. Those rules and regs, I mean, those are the 
criteria for the loan?
    Mr. Ryan. Yes, sir.
    Senator Tester. When do you anticipate that criteria or 
those regs will be done?
    Mr. Ryan. I've visited with my Commissioner about this 
subject and he's expressed an interest in having rules and regs 
out by the time we get into the fall or early winter. I know 
he's working hard to make that a reality. I'm hopeful that he's 
successful because I know several communities that are 
anxiously awaiting them.
    Senator Tester. Yes. If you can find out a time for that, 
that would be good because I think this is an important funding 
mechanism.
    Mr. Ryan. Yes, sir.
    Senator Tester. Back in the day Commissioner Keys testified 
on the Rural Water Supply Act of 2005. He stated that the 
Office of Management and Budget had done a review of 
Reclamation's rural water activities and determined that the 
program was not demonstrating results. Specifically the review 
noted that Congress had authorized projects that may not be in 
the best Federal interest.
    As a result of the OMB review the Bush Administration 
recommended eliminating most of the funding for rural water 
projects. Based on what you know about the projects here in 
South Dakota and the importance they offer the communities and 
Native Americans in this state, do you believe that these 
projects are not in the best Federal interest?
    Mr. Ryan. Senator, I've been to, not all, but many of these 
projects. I've seen the source water that these families have 
now. I've seen what projects like this can do in providing safe 
and certain potable water for children and for communities. I 
can't help but think that's in the interest of my government to 
do that.
    Senator Tester. Well, I appreciate that response. Just in 
closing, I want to thank you again, Senator Johnson for getting 
Mr. Ryan here. I do appreciate you sacrificing to be here at 
the committee here today.
    Mr. Ryan. Thank you, sir. It's an important topic.
    Senator Tester. What's that?
    Mr. Ryan. It's an important topic. I'm pleased to be here.
    Senator Tester. It is an important topic. I just want to 
close on one question. I know that Senator Johnson and myself 
and others in this region fight hard for dollars for water 
projects. But when the President's budget zeros them out it 
really puts us behind the eight ball.
    Mr. Ryan. Yes, sir.
    Senator Tester. Do you see anything that you can do to put 
a little common sense in this equation?
    Mr. Ryan. One thing that I can specifically help do, 
Senator, is make sure that the folks that I work with within 
the Administration are as fully informed as possible. That 
means not only providing written information but whenever 
schedules and their own budgets allow getting them to the 
locations to see the work and to visit with the people who are 
benefiting from these projects. That helps me because it 
improves understanding. So I think that's helpful.
    I think another thing that's helpful is when we work with 
the project sponsors on the engineering aspects trying to make 
sure we squeeze as much good out of every dollar as we can. But 
then also have a common understanding of what additional 
capabilities we may have should funding become available that 
we could put to good work. You know that's the reason why I 
became a public servant years ago when I graduated and got my 
engineering degree. It's some of the most rewarding work that I 
do.
    Senator Tester. Good. I appreciate, you know, getting the 
most bang for the buck and then making sure the engineering 
meets the needs and is lean and mean in that process. I would 
tell you that I would offer our help in getting anything that 
we can do to help facilitate these folks out here because I 
agree with you.
    We can get people within the bureaucracy to come out and 
see first hand what's going on. Come and see first hand, as you 
have. As you've said, you have had to see first hand what's 
going on as far as inadequacies in rural America in this 
region. I think it helps us all.
    Mr. Ryan. Yes, sir.
    Senator Tester. Makes our job a bit easier.
    Mr. Ryan. Yes, sir.
    Senator Tester. So thank you very much, Mike.
    Mr. Ryan. Thank you, Senator.
    Senator Johnson. Mr. Ryan, in conclusion I don't understand 
the priorities of this Administration. For instance $1 billion 
would make a huge difference in the water funding for America. 
It costs $200 billion a year in Iraq.
    I don't understand that as a set of priorities at all. But 
I don't expect you to answer that. Thank you for coming.
    Mr. Ryan. Thank you, sir.
    Senator Johnson. Thank you, Senator Tester. Now I'd like to 
move onto to the second group of witnesses. We have a good list 
of witnesses from South Dakota who can provide their views on 
the importance of BOR's meeting the water supply needs of the 
State.
    We're joined today by Mayor David Munson of Sioux Falls, 
South Dakota. Troy Larson, Executive Director of the Lewis and 
Clark Regional Water System. President John Steele of the 
Oglala Sioux Tribe. President Rodney Bordeaux of the Rosebud 
Sioux Tribe. Chairman Mike Jandreau of the Lower Brule Sioux 
Tribe and Jake Fitzgerald, manager of the West River/Lyman-
Jones Water System.
    Welcome to each of you. Mayor Munson, please go ahead with 
your statement. We'll then proceed with the other witnesses. 
After all of you have completed your statements we'll proceed 
with questions.
    Mayor Munson, go right ahead.

        STATEMENT OF DAVE MUNSON, MAYOR, SIOUX FALLS, SD

    Mr. Munson. Mr. Chairman and Senator Tester, my name is 
Dave Munson, Mayor, city of Sioux Falls, South Dakota. It is my 
pleasure to welcome you to our city. I thank you for bringing 
this field hearing to Sioux Falls. For the opportunity to 
testify before your committee regarding the need our city has 
for Lewis and Clark Regional Water System.
    Sioux Falls is the largest city in South Dakota. Last year 
our population exceeded 150,000 people. By the year 2035 we 
estimate Sioux Falls will have 271 citizens. If you combine the 
city with our four county area our population will 
approximately 400,000.
    Our city is striving for many reasons. We believe we found 
an excellent balance between cost of living and quality of 
life. For three straight years a major national publication has 
ranked Sioux Falls the best small city in America for 
businesses and careers.
    In 2007 the value of our building construction exceeded a 
half billion dollars, a number you usually find in cities the 
size of Omaha or Des Moines. Our housing market is stable. In 
2007 alone we constructed over 1,700 dwelling units which was 
much higher than in the last several years.
    Our unemployment rate is extremely low. Our major 
industries are diversified with an excellent medical community, 
a very strong financial sector and continued ties to our 
agricultural roots. But we know that for Sioux Falls to 
continue to grow and fulfill its potential we need to secure a 
future water supply.
    For 20 years the city has been committed to working as a 
regional partner to develop the Lewis and Clark Water System. 
In 2007 our city Council approved the largest bond issuance in 
the city's history. We committed $70 million to pre-pay the 
city's share of the Lewis and Clark project.
    Our debt will be repaid over 30 years through increases to 
our resident's water rates. We believe it is critical to show 
our Federal partners that the citizens of Sioux Falls are 
sharing in the cost of this critical need for our community.
    When Lewis and Clark is completed Sioux Falls will be able 
to access 27 million gallons of water a day. This will provide 
enough supply to meet the needs of not just our residents, but 
the many businesses that draw thousands of regional employees 
and customers. They help make Sioux Falls an economic engine 
for the entire State of South Dakota and the surrounding 
region.
    Since 2000 the Sioux Falls Metro Area has added more than 
12,000 jobs. This accounts for more than half of all the new 
jobs added to the entire State of South Dakota in that time. 
Taxable sales in Sioux Falls also account for more than 25 
percent of all sales in the State.
    It makes sense that a growing city has many needs from road 
improvement to features like parks and libraries that improve 
our quality of life. But as we prioritize these needs in Sioux 
Falls, water consistently rates as our top priority. Without 
it, we simply cannot sustain our positive growth.
    Sioux Falls has a geographic room to expand. We continue to 
invest in our critical infrastructure, including streets, 
sanitary sewer systems and storm drainage facilities. Without 
an adequate water supply, however, this well planned growth 
simply cannot continue.
    When new businesses and industry visit Sioux Falls a major 
factor determining their move is the availability of water. The 
expanded Lewis and Clark pipeline will provide water resources 
for Sioux Falls to meet its growth for the next 40 to 50 years 
if properly managed. While we are clearly very focused on 
growing our available water supply we are also committed to 
conserving this precious resource.
    I am proud to say that Sioux Falls is leading the way in 
our State and Region when it comes to responsible water use. 
For several years we have restricted water use between noon and 
five when demand was highest on the system. We also have 
transitioned residents into watering on odd/even days of the 
week and recently made that change year round instead of only 
in the summer months.
    We offer water conservation kits to residents with items 
like low flow shower heads, hose nozzle and lawn watering 
gauge. We also provide rebates for purchasing efficient washing 
machines, rain sensors and irrigation timers. To date we have 
rebated back nearly $1.4 million to our residents and have 
lowered our per capita use of water by nearly 10 gallons of 
water per person per day.
    Sioux Falls is not simply waiting for a supplemental supply 
of water. We are working hard to become a more sustainable 
community now and well into the future. In Sioux Falls we truly 
recognize the value of our natural resources.
    We are grateful that our Federal partners continue to 
support our infrastructure needs through the Lewis and Clark 
Regional Water System. I assure you that you're investing in an 
excellent city. That future generations will benefit from your 
support for decades to come.
    I want to thank you again for the opportunity to present at 
this important hearing.
    [The prepared statement of Mr. Munson follows:]

       Prepared Statement of Dave Munson, Mayor, Sioux Falls, SD

    My name is Dave Munson, Mayor of Sioux Falls, South Dakota.
    It is my pleasure to welcome you to our city. And I thank you for 
bringing this field hearing to Sioux Falls and for the opportunity to 
testify before your Committee regarding the need our city has for the 
Lewis and Clark Regional Water System.
    Sioux Falls is the largest city in South Dakota. Last year, our 
population exceeded 150,000 people. By the year 2035, we estimate Sioux 
Falls will have 271,000 residents.
    If you combine the city with our four-county area, our population 
will be approximately 400,000.
    Our city is thriving for many reasons. We believe we've found an 
excellent balance between cost of living and quality of life.
    For three straight years, a major national publication has ranked 
Sioux Falls the best small city in America for businesses and careers.
    In 2007, the value of our building construction exceeded half a 
billion dollars, a number you usually find in a city the size of Omaha 
or Des Moines. Our housing market is stable. In 2007 alone, we 
constructed over 1,700 dwelling units, which was much higher than the 
last several years.
    Our unemployment rate is extremely low. Our major industries are 
diversified, with an excellent medical community, a very strong 
financial sector and continued ties to our agricultural roots.
    But we know that for Sioux Falls to continue to grow and fulfill 
its potential, we need to secure our future water supply.
    For 20 years, the city has been committed to working as a regional 
partner to develop the Lewis and Clark water system.
    In 2007, our City Council approved the largest bond issuance in the 
City's history. We committed 70 million dollars to prepay the City's 
share of the Lewis and Clark project. Our debt will be repaid over 30 
years through increases to our residents' water rates. We believe it is 
critical to show our federal partners that the citizens of Sioux Falls 
are sharing in the cost of this critical need for our community.
    When Lewis and Clark is completed, Sioux Falls will be able to 
access 27 million gallons of water a day.
    This will provide enough supply to meet the needs of not just our 
residents, but the many businesses that draw thousands of regional 
employees and customers. They help make Sioux Falls an economic engine 
for the entire state of South Dakota and the surrounding region.
    Since 2000, the Sioux Falls metro area has added more than 12,000 
jobs. This accounts for more than half of all the new jobs added to the 
entire state of South Dakota in that time.
    Taxable sales in Sioux Falls also account for more than 25 percent 
of all sales in the state.
    It makes sense that a growing city has many needs, from road 
improvements to features like parks and libraries that improve our 
quality of life. But as we prioritize these needs in Sioux Falls, water 
consistently rates as our top priority.
    Without it, we simply cannot sustain our responsible, positive 
growth.
    Sioux Falls has the geographical room to expand. We continue to 
invest in our critical infrastructure including streets, sanitary sewer 
systems, and storm drainage facilities. Without an adequate water 
supply however, this well-planned growth simply cannot continue. When 
new businesses and industries visit Sioux Falls, a major factor in 
determining their move is the availability of water.
    The expanded Lewis & Clark pipeline will provide water resources 
for Sioux Falls to meet its growth needs for the next 40 to 50 years if 
properly managed. While we are clearly very focused on growing our 
available water supply, we're also committed to conserving this 
precious resource.
    I am proud to say that Sioux Falls is leading the way in our state 
and region when it comes to responsible water use.
    For several years, we have restricted water use between noon and 
five, when demand was highest on the system. We have also transitioned 
residents into watering on odd and even days of the week, and recently 
made that change year-round instead of only in the summer months.
    We offer free water conservation kits to residents with items like 
a low flow showerhead, hose nozzle and lawn watering gauge. And we also 
provide rebates for purchasing efficient washing machines, rain sensors 
and irrigation timers. To date, we have rebated back nearly $1.4 
million dollars to our residents and have lowered our per capita use of 
water by nearly 10 gallons of water, per person, per day. Sioux Falls 
is not simply waiting for a supplemental supply of water; we are 
working hard to become a more sustainable community, now and well into 
the future.
    In Sioux Falls, we truly recognize the value of our natural 
resources. We are grateful that our federal partners continue to 
support our infrastructure needs through the Lewis and Clark Regional 
Water System.
    I assure you that you're investing in an excellent city, and that 
future generations will benefit from your support for decades to come.
    Thank you again for the opportunity to present at this important 
hearing.

    Senator Johnson. Thank you, Mayor.
    Mr. Larson.

  STATEMENT OF TROY LARSON, EXECUTIVE DIRECTOR, LEWIS & CLARK 
             REGIONAL WATER SYSTEM, SIOUX FALLS, SD

    Mr. Larson. I'm Troy Larson. I'm the Executive Director of 
the Lewis and Clark Regional Water System. I'm honored to have 
the opportunity, Mr. Chairman, Senator Tester, to be before 
you. As Executive Director of Lewis and Clark I hope to convey 
to you the importance of the Federal Government's commitment in 
helping to address the critical water needs of the tri-state 
region through the development of this vitally important water 
project.
    Lewis and Clark is a unique cooperative effort among 20 
member cities and rural water systems. The States of South 
Dakota, Iowa and Minnesota as well as the Federal Government. 
Also unique is the project's regional approach to address 
common water problems in the tri-state region in a more 
effective and cost efficient way than each member could even 
attempt to do alone.
    Regional water problems include shallow wells and aquifers 
prone to contamination, compliance with ever tightening Federal 
drinking water standards, population and economic growth 
stifled due to inadequate water supplies and insufficient 
resources to replace aging facilities. When completed the 
project will be a wholesale provider of water to its 20 cities 
and rural water systems. Lewis and Clark will not connect 
individual homes and businesses.
    Through its members Lewis and Clark will provide a 
desperately needed source of quality, reliable drinking water 
from a series of wells adjacent to the Missouri River to over 
300,000 people in South Dakota, Iowa and Minnesota. The 
following chart to my left shows the service area of Lewis and 
Clark which represents the size of Connecticut. We haven't 
informed Connecticut of this yet, but they're an official unit 
of measurement now for Lewis and Clark. But it gives you a 
perspective of its scope.
    Lewis and Clark was incorporated in 1990. In 2000 the 
project was authorized by Congress and signed into law. The 
project is owned and governed by the 20 local members with 
construction oversight provided by the Bureau of Reclamation.
    Construction got underway in 2004. So we are in our fifth 
season of construction. Currently the project has 90 miles of 
primarily 54-inch diameter pipe either completed or under 
construction along with seven wells.
    In the picture to my right puts in perspective the 54-inch 
diameter pipe. For those in the audience I believe there's some 
copies of my testimony that you'll be able to see some of these 
pictures and graphs.* For you, Senator Tester, for your benefit 
I should note that a $30.7 million pipeline project was just 
awarded last week to a firm headquartered out of Bozeman, 
Montana. So they'll be doing some work for us.
---------------------------------------------------------------------------
    * Pictures and graphs have been retained in subcommittee files.
---------------------------------------------------------------------------
    Senator Tester. Thank you.
    [Laughter.]
    Mr. Larson. A couple other pictures of our construction. On 
my right here is a typical cross section of our pipeline 
construction. There is six foot of fill that goes on top of the 
pipeline. The picture on my left shows a 50-foot long section 
of the 54-inch diameter pipe being lowered into the trench. I 
just share these pictures to give you a little bit of 
perspective on the size of the pipeline.
    The following chart summarizes the progress being made. The 
red lines represent construction that has been completed. The 
green lines are construction that is underway. In addition the 
first phase of the water treatment plant will be bid this 
summer. The maximum capacity of the plant will be 45 million 
gallons a day.
    Today's field hearing comes at an exciting time for Lewis 
and Clark. On May 1, Lewis and Clark celebrated a momentous 
occasion as we put into operation the first segment of 
pipeline. The nine miles of pipe between Sioux Center and Hull 
shown over here were built several years earlier than planned 
to serve as an emergency connection for Hull which is facing 
water shortages.
    On a temporary basis until Lewis and Clark water arrives, 
Lewis and Clark will purchase water from Sioux Center. Resell 
it to Hull as a band aid approach to buy time for that 
community. As our Chairman, Red Art noted, who's with us today, 
``It took 18 years, but we're finally selling water, nine miles 
down, only 328 miles to go.''
    A similar emergency connection is being built sooner than 
planned for the rapidly growing communities of Tea and 
Harrisburg, South of Sioux Falls. That's this segment of pipe 
right here. That is being built earlier than anticipated as 
well.
    In the short term water will be purchased from Sioux Falls 
on a temporary basis and resold to Tea and Harrisburg. We hope 
to have this second emergency connection in operation this 
summer. These emergency connections demonstrate the critical 
water needs in the region and the extent Lewis and Clark is 
going to try to buy time for these communities until Lewis and 
Clark water arrives.
    Another demonstration of the critical water needs is the 
pre-payment being made by the local members and 3 States. 
Generally speaking the cost break down for this project is 80 
percent Federal funding, 10 percent from the 3 states and 10 
percent from the local members. The exception is Sioux Falls 
which has a higher cost share.
    To help keep construction on track and reduce the impact of 
inflation, 17 of Lewis and Clark's 20 members have pre-paid 
their entire share of the project. As you will see on this 
chart, to date the members have paid a total of $106.5 million 
which represents close to 99 percent of the member's 
commitment. It's important to note and I can't stress this 
enough that many of the members are pre-paying millions of 
dollars, decades or more, before they will see a single drop of 
water. That's putting your money where your mouth is.
    As has been noted by some in Congress, this took a lot of 
guts and demonstrates not only the strong local support, but 
how important it is for the project to be completed in a timely 
manner. In addition on the chart you will see the States of 
Iowa and Minnesota have paid 100 percent of their commitment 
which totals $12.4 million. The South Dakota legislature 
approved $6.4 million for Lewis and Clark this year which is 
one-third of Governor Round's plan to pre-pay the State's 
remaining share by 2010.
    By contrast, the Federal Government has paid $102 million 
to date which represents just over 28 percent of the Federal 
Government's commitment. Now it's important to note that we are 
very grateful for the funding that has been appropriated thus 
far. We are especially grateful to our elected officials who 
have fought so hard for every penny that has been allocated for 
Lewis and Clark.
    In particular last year's record $26.5 million for the 
project would have never happened without the leadership of 
Senators Tim Johnson, John Thune and Representative Stephanie 
Herseth Sandlin. Given the tight budget constraints Congress 
was facing last year, securing a $5.5 million increase over 
last year was nothing short of a Herculean effort by our tri-
state congressional delegation. Unfortunately that great news 
was short lived, lasting only 5 weeks until we learned that 
Lewis and Clark has received a recommendation of $0 dollars in 
the Bureau of Reclamation's budget for fiscal year 2009.
    Thirty-five million dollars is what Lewis and Clark needs 
to keep construction on schedule which is already close to 4 
years behind schedule. At $35 million, the earliest the project 
would be completed is 2020 which is shown by the blue line on 
this chart to my right which highlights the impacts of 
inflation. At $35 million a year the total project cost would 
be just over $525 million.
    However, if hypothetically the project only receives $15 
million each year, which is what the Administration proposed 
last year, it's estimated the project would not be completed 
until 2045 as shown by the green line and would have an overall 
price tag of just over $700 million. This assumes, I want to 
stress, a very conservative 4 percent rate of inflation. We 
haven't seen 4 percent rate of inflation for some time. So 
these numbers will likely be higher.
    In summary, rural water projects, like Lewis and Clark are 
vitally important to improving the quality of life and 
expanding economic development opportunities for the people 
they serve. Projects like Lewis and Clark simply cannot be 
completed without the cooperation and assistance from the 
Federal Government. However the longer it takes to receive the 
necessary Federal funding for these projects, the more 
expensive they become as a result of inflation. The longer 
critical water needs go unmet.
    It's very important that rural water projects under 
construction be completed in a timely manner. Thank you very 
much for you time and consideration.
    [The prepared statement of Mr. Larson follows:]


 Prepared Statement of Troy Larson, Executive Director, Lewis & Clark 
                 Regional Water system, Sioux Falls, SD

    Mr. Chairman and members of the Committee, I am honored to have the 
opportunity to appear before you to discuss the Lewis & Clark Regional 
Water System (L&C). As Executive Director of L&C, I hope to convey to 
you the importance of the federal government's commitment in helping to 
address the critical water needs of the tri-state region through the 
development of this vitally important water project.
    L&C is a unique cooperative effort among 20 member cities and rural 
water systems, the States of South Dakota, Iowa, Minnesota, and the 
Federal Government. Also unique is the project's regional approach to 
address common water problems in the tri-state region in a more 
effective and cost-efficient way than each member could even attempt to 
do alone. Regional water problems include shallow wells and aquifers 
prone to contamination, compliance with ever tightening federal 
drinking water standards, population and economic growth stifled due to 
inadequate water supplies, and insufficient resources to replace aging 
facilities. When completed, the project will be a wholesale supplier of 
water to its 20 cities and rural water systems. L&C will not connect 
individual homes and businesses. Through its members, L&C will provide 
a desperately needed source of quality, reliable drinking water from a 
series of wells adjacent to the Missouri River to over 300,000 people 
in South Dakota, Iowa and Minnesota. The following chart shows the 
service area of L&C, which represents the size of Connecticut.
    L&C was incorporated in 1990 and in 2000 the project was authorized 
by Congress and signed into law. The project is owned and governed by 
the 20 local members, with construction oversight provided by the 
Bureau of Reclamation. Construction got underway in 2004, so we are in 
our fifth construction season. Currently, the project has 90 miles of 
primarily 54'' pipe either completed or under construction, along with 
seven wells. For Senator Tester's benefit, I should note that a $30.7M 
pipeline contract was awarded last week to a firm headquartered in 
Bozeman, MT.
    Here are a few pictures that show the 54'' pipe being constructed.
    The following chart summarizes the progress being made. The red 
lines represent construction that has been completed and the green 
lines are construction that is underway.
    The first phase of the water treatment plant will be bid this 
summer. The maximum capacity of the plant will be 45 million gallons a 
day.
    Today's field hearing comes at an exciting time for us. On May 1st, 
L&C celebrated a momentous occasion as we put into operation the first 
segment of pipeline. The nine miles of pipe between Sioux Center and 
Hull, Iowa, were built several years earlier than planned to serve as 
an emergency connection for Hull, which is facing water shortages. On a 
temporary basis until L&C water arrives, L&C will purchase water from 
Sioux Center and re-sell it to Hull as a band-aid approach to buy time 
for that community. As our Chairman, Red Arndt, noted, ``It took 
eighteen years, but we're finally selling water. Nine miles down, only 
328 miles to go.''
    A similar emergency connection is being built sooner than planned 
for the rapidly growing communities of Tea and Harrisburg, with water 
to be purchased from Sioux Falls on a temporary basis. We hope to have 
this second emergency connection in operation this summer. These 
emergency connections demonstrate the critical water needs in the 
region and the extent L&C is going to try to buy time for these 
communities until L&C water arrives.
    Another demonstration of the critical water needs is the pre-
payment being made by the local members and three states. Generally 
speaking, the cost breakdown for this project is 80% Federal funding, 
10% from the three states and 10% from the local members. The exception 
is Sioux Falls, which has a higher cost share. To help keep 
construction on track and reduce the impacts of inflation, 17 of L&C's 
20 members have pre-paid their entire share of the project. As you will 
see on this chart, to date, the members have paid a total of $106.5M, 
which represents close to 99% of the members' commitment. It's 
important to note that many of the members have pre-paid millions of 
dollars a decade or more before they will see a single drop of water. 
That's putting your money where your mouth is. As has been noted by 
some in Congress, this took a lot of guts and demonstrates not only the 
strong local support, but how important it is for the project to be 
completed in a timely manner.
    In addition, the States of Iowa and Minnesota have paid 100% of 
their commitment, which totals $12.4M. The South Dakota Legislature 
approved $6.4M for L&C this year, which is one-third of Governor 
Rounds' plan to pre-pay the State's remaining share by 2010.
    By contrast, the Federal government has paid $102M to date, which 
represents just over 28% of its commitment. It is important to note 
that we are very grateful for the funding that has been appropriated 
thus far--and we are especially grateful to our elected officials who 
have fought so hard for every penny that has been allocated to L&C. In 
particular, last year's record $26.5M for the project would have never 
happened without the leadership of Senators Tim Johnson, John Thune and 
Representative Stephanie Herseth Sandlin. Given the tight budget 
constraints Congress was facing last year, securing a $5.5M increase 
over last year was nothing short of a Herculean effort by our tri-state 
delegation. Unfortunately, that great news was short-lived, lasting 
only five weeks until we learned that L&C had received a recommendation 
of zero dollars in the Bureau of Reclamation's budget for FY09.
    $35M is what L&C needs to keep construction on schedule, which is 
already close to four years behind schedule. At $35M, the earliest the 
project would be completed is 2020, which is shown by the blue line on 
this chart that highlights the impacts of inflation. The estimated cost 
of the project would be just over $525M. However, if hypothetically the 
project only receives $15M each year, which is what the Administration 
proposed last year, it is estimated the project would not be completed 
until 2045, as shown by the green line, and would have an overall price 
tag of just over $700M. This assumes a very conservative 4% rate of 
inflation, so the numbers will likely be higher.
    In summary, rural water projects like L&C are vitally important to 
improving the quality of life and expanding economic development 
opportunities for the people they serve. Projects like L&C simply 
cannot be completed without the cooperation and assistance from the 
Federal government. However, the longer it takes to receive the 
necessary Federal funding for these projects, the more expensive they 
become as a result of inflation and the longer critical water needs go 
unmet. It is very important that rural water projects under 
construction be completed in a timely manner. Thank you very much for 
your time.

    Senator Johnson. Mr. Steele.

 STATEMENT OF JOHN STEELE, PRESIDENT, OGLALA SIOUX TRIBE, PINE 
                           RIDGE, SD

    Mr. Steele. We don't all have to go to Washington to--I 
don't like that place over there.
    [Laughter.]
    Mr. Steele. But Senator, I'd like to say that yourself, 
you've been involved in just about every one of these projects 
since their inception. I think you've done the most while you 
were in the House of Representatives and the Senate to see 
these projects to where they are now. Senator Tester, I thank 
you for coming to South Dakota and welcome.
    Senators, we not only thank you for holding this hearing 
here. We, from the Oglala Sioux Tribe, and the Mni Wiconi 
Project would endorse and support each and every project on 
that board up there. The Lewis and Clark, the Mni Wiconi, 
Perkins County, Garrison Diversion, the Fort Peck and Rocky 
Boy's because we realize the need for water, not only to today 
for the health needs and the economic development for the 
future development.
    Our area here is very--some of it, especially my area, like 
Mr. Larson said here, the quality of the water, the water table 
going down, the concentration of minerals. It's costing the 
Federal Government more, Senator Johnson, the longer we wait 
for the completion of these projects. Our project was to be 
completed in 2003 and because of the inadequate funding over 
the years, we're now at a sunset year of 2013.
    Also unlike some of the projects out there I would like to 
say that the treaty that we have with the U.S. Government, the 
Treaty of Peace, the Federal Government then promised us 
adequate health care. This, today, is needed on Pine Ridge. We 
can show it, Senator, in some of the statistics now. But we 
would like to say, Senator, that we have a very good team. The 
Lyman-Jones/West River, Lower Brule and Rosebud along with the 
Oglalas are getting the project done.
    I would like, Mr. Ryan and I liked his testimony. But I 
think that BOR needs to step up to the plate a little more. I 
would like to meet with Mr. Ryan to tell him he's looking at 
cost efficiency and the cost effective manner in which to get 
the projects done.
    But I don't know if Mr. Ryan knows the history, the 
Appropriations of 1871 saying that no more treaties would be 
made with Indian tribes. Hereafter they would be dealt with, 
with acts of Congress. But nothing in these acts would or could 
change anything in the existing treaties. That the U.S. Supreme 
Court in several cases ruled that the treaties are to be 
interpreted as the Indians interpret them.
    The Act of 1877, they call it, I don't know what the right 
name of that is. But a lot of people refer to it back at home. 
When the Federal Government realized that they'd killed off all 
of the buffalo and the Act of 1877 is sort of a social services 
act that established the rations. In general it says to sustain 
that individual Indian.
    Senators the rations came out of that surplus commodity 
program. We'd like to interpret that to mean in keeping of the 
Federal Governments treaty language and the healthcare to show 
them how the existing infrastructure of the pipeline, right 
now, has affected these statistics and these numbers. It's 
affected the cost to the Federal Government and how, yet today, 
the chemicals, especially arsenic.
    EPA is temporarily letting us use some wells, Senator, with 
the understanding that this river water is going to reach Pine 
Ridge. This arsenic is causing cancer. There's a high cost to 
that, Senator. It can be affected with the completion of our 
project in Mni Wiconi.
    We need to talk to someone to show them this documentation 
so that the government will--and we also have some posters, 
Senator. The first one is the pipe trenching between Kadoka and 
the Reservation. I would like to introduce the individual 
standing there, Senator and say that Mr. Frank ``Popo'' Means, 
when I was Vice President.
    I believe, Pope, that was between 1984 and 1986. He was on 
the Tribal Council. He went up to Karoake and met with Senator 
Abner had a meeting up there. That was the first time that the 
non-Indian and the Indian got together on our water needs.
    We had been thinking of the same thing back in the 1950's, 
we understand, on usage of that Missouri River water. So that's 
when we actually got together, testimony was developed. Now, 
Mr. Means is the Executive Director of our whole program, the 
Mni Wiconi Project, the construction from the river to the 
Reservation and inside the Reservation, the distribution 
system. But the pipe trenching is the connecting between 
Karoake and Pine Ridge which we will realize this fall.
    The other picture is, we call it one of the most modern 
treatment plants in the whole United States, very computerized. 
Oglala Sioux Tribal members are in charge. They're operating 
the intake and the water treatment plant. Everything is going 
good in the communities we're supplying right now. We do have a 
reservoir there. We have reservoirs, pumping stations that the 
Oglala Sioux Tribe operates and maintains.
    The last picture on the end over there is what is labeled 
water hauling. This is an ongoing thing on Pine Ridge that we 
have homes that have to haul water for domestic use, for 
drinking, for washing dishes, for cooking. We get into it with 
the Bureau because they don't like the project of hauling water 
to people's homes.
    We have to argue with them over a budget for that so that 
we can at least the household by delivering water to their 
homes until the pipeline and distribution system does get to 
them. But that's water hauling. We've got quite a number of 
them yet on Pine Ridge that we haul water to their homes.
    I'm taking too much time up, Senator. Will be able to 
answer questions. But I did provide you with some written 
testimony, Senator and would like to have that included in the 
record, please.
    Senator Johnson. It will be received.
    Mr. Steele. Thank you.
    [The prepared statement of Mr. Steele follows:]

Prepared Statement of John Steele, President, Oglala Sioux Tribe, Sioux 
                               Falls, SD

    Mr. Chairman, my name is John Steele, and I am president of the 
Oglala Sioux Tribe. I am pleased that you extended an invitation to 
present testimony on the status of rural water projects. I am 
representing the Oglala Sioux Rural Water Supply System, which was 
created pursuant to the Mni Wiconi Project Act of 1988, Pub.L.100-516.
    The Oglala Sioux Rural Water Supply System serves as the backbone 
of the Mni Wiconi Project. It diverts raw water from the Missouri River 
near Fort Pierre, South Dakota, treats the water in a state-of-the-art 
processing facility manned by members of the Oglala Sioux Tribe and 
delivers water through 4,200 miles of pipeline, when completed, to the 
Lower Brule, Rosebud and Pine Ridge Indian Reservations and parts of 
nine counties in southwestern South Dakota served by the West River/
Lyman-Jones Rural Water System (See Exhibit 1).* It is the largest 
rural water project in the world. Each of these interconnecting systems 
will present testimony separately.
---------------------------------------------------------------------------
    * Exhibits have been retained in subcommittee files.
---------------------------------------------------------------------------
                HISTORY OF THE GEOGRAPHICAL AREA SERVED

    The Oglala Sioux Tribe and other Sioux tribes fought a war called 
the Potter River War (Red Cloud's War) from 1866-1868, which culminated 
in the signing of the 1868 Fort Laramie Treaty, 15 Stat. 635. Article 
II of the Fort Laramie Treaty of 1868 established the area west of the 
``east bank'' of the Missouri River as the Great Sioux Reservation, a 
permanent reservation for the signatory tribes. This was the homeland 
of the Lakota people. Our leadership recognized the importance of the 
Missouri River and embraced both banks and the full course of the 
stream within our Treaty area. Our water treatment plant, 200 miles 
east of the Pine Ridge Indian Reservation, relies on this source of 
water that was so important to our forefathers.
    In 1876, Congress attempted to purchase the Black Hills portion of 
the Reservation but could not obtain the requisite number of signatures 
needed from the Indian people to constitute a cession by agreement. 
Congress resolved its perceived impasse by enacting the agreement into 
law as the 1877 Act, 19 Stat. 254. Under Article 5 of the 1877 Act, 
Congress promised all aid to civilization to the signatory tribes as 
part of the quid pro quo for the confiscated territory. We view the Mni 
Wiconi Project as a part of this promise. It will, when fully 
implemented, provide a safe supply of water to the Oglala and other 
Sioux project sponsors.
    In 1889, Congress admitted South Dakota as a new member of the 
United States. Congress also created smaller reservations out of the 
Great Sioux Reservation, including the Pine Ridge, Lower Brule and 
Rosebud Reservations. 25 Stat. 888. Settlement by non-Indians was 
permitted west of the Missouri River.
    When the Mni Wiconi Project Act was signed into law in 1988, five 
generations of the Lakota and white settlers had coexisted in the 
project area, but great prejudices existed between the two peoples. Our 
people had existed in deep poverty, and bad feelings predominated with 
the farmers and ranchers outside the Reservation. Our people initially 
refused to accept the Project, suspicious of the intentions of the 
United States and skeptical that the benefits of the project as 
proposed would ever reach the Pine Ridge Indian Reservation. Many felt 
that the Tribe was being used to deliver water to people off the 
Reservation, and water would never reach us.
    The poverty has not abated. The Pine Ridge Indian Reservation 
remains the lowest per capita income region in the Nation, but the Mni 
Wiconi Project has brought an element of hope and faith in the future. 
Through the Mni Wiconi Project we have had to meet our neighbors, 
settle age-old differences with them and pull together for a common 
purpose of building a magnificent project that will improve the quality 
of life for everyone in Western South Dakota, non-Indian and Indian 
alike.
    From the standpoint of the Office of Management and Budget (OMB), 
the project must conform to all federal regulations and be built as 
efficiently and cost-effectively as possible within a constrained 
budget and without consideration of the social benefits. But from our 
standpoint, great divides have been crossed, and a reconciliation of 
social differences between peoples with vastly different backgrounds 
has been achieved. This is not to say that differences do not exist, 
but the Mni Wiconi Project has brought a mutual level of respect 
between the Indian and non-Indian water users. The Oglala Sioux Tribe 
has demonstrated that it can operate the common facilities beginning at 
the Missouri River and deliver the water of life to non-Indian 
neighbors within the West River/Lyman-Jones service area and to our 
relations on the Lower Brule and Rosebud Indian Reservations.Oglala 
Lakota tribal members have developed and demonstrated the skills, 
qualifications and competence to operate a highly sophisticated 
engineering project for the mutual benefit of everyone. This is a great 
honor to the people of the Pine Ridge Indian Reservation.

                   Extended Schedule of Construction

    While there is pride in the project and hope for the future, we 
have been afflicted by an inadequate level of funding appropriated by 
Congress. This problem begins with a chronically low allocation from 
OMB for the rural water program of the Bureau of Reclamation in the 
President's annual budget proposals. Congress has consistently worked 
to increase the level of funding for our project, but the funds have 
been inadequate to advance at the rate of construction contemplated in 
the authorizing legislation and within the sponsors' capability. Our 
original statutory completion date was 2003. In 2000, Congress extended 
the completion date through 2008, and last year Congress extended the 
completion date through 2013. These amendments have been necessary 
because Congress has not been able to provide funds that would permit 
us to complete the project on schedule. Congress needs an adequate 
budget request from which to work. It has consistently worked hard to 
enact funding as much as possible over the requests, but with a higher 
floor from the President, it could be able to achieve enacted levels 
much closer to the level of annual need. Rather than completion in one 
decade, the project has been extended through two full decades, and the 
benefits have been delayed.
    The Pine Ridge Indian Reservation is the furthest location from our 
water treatment plant on the Missouri River. The Oglala Sioux Tribe 
will not receive Missouri River water until late in fiscal year 2008, 
15 years after the start of construction. All of our effort prior to FY 
2008 has been to build the intake, water treatment plant and pipelines 
used for the common benefit of the Lower Brule, Rosebud, Pine Ridge and 
West River/Lyman-Jones service areas. As those common pipelines have 
been constructed westward, the Bureau of Reclamation has authorized the 
building of the distribution systems that could receive Missouri River 
water. It did not, however, authorize the building of the distribution 
systems on the Pine Ridge Indian Reservation in advance that would 
receive Missouri River water. We have been able to deliver all water 
requirements to the Lower Brule Sioux Indian Reservation. Likewise, the 
Rosebud Sioux Indian Reservation has been able to connect to our 
pipelines and receive Missouri River water. The West River/Lyman-Jones 
service area now receives Missouri River water in most areas except its 
far western portion. (See Exhibits II and III for examples of 
constructed facilities).
    Most of the remaining construction will and must focus on the 
distribution system on the Pine Ridge Indian Reservation. The remaining 
40% of the population to be served by the Missouri River water 
treatment plant resides on the Reservation. Missouri River water will 
finally be delivered to the northeast corner of the Pine Ridge Indian 
Reservation and the community of Wanblee in late 2008. While we are 
pleased that it is coming, much work remains before we can provide 
water to our people throughout our Reservation. We continue to haul 
water by truck to hundreds of households on the Reservation (See 
Exhibit III, for example).
    Delay in delivering Missouri River water to the Pine Ridge Indian 
Reservation has created great anxiety among the Oglala Lakota 
membership. Old suspicions have been renewed that water will never 
reach us, that Congress will withdraw its support for the project when 
the non-Indian service area has been largely completed. These concerns 
were elevated this winter by the drastic cut in the President 's Budget 
which reduced the Bureau-wide Rural Water Program from $55 million in 
FY 2008 to $28 million in FY 2009. The cut for the Mni Wiconi Project 
was severe. If not restored by Congress, the project cannot be 
completed by 2013. The delivery of water to the Oglala Lakota will be 
delayed, anxiety levels will rise and confidence in the project and the 
United States will diminish.

                 HEALTH BENEFITS OF MNI WICONI PROJECT

    The project area was formerly occupied by an ancient, inland sea. 
Dinosaurs surrounded its shores. Over many eons, salts accumulated in 
the sediments that were deposited. To the west in the Yellowstone Park 
area, volcanism contributed arsenic and uranium to the sediments 
carried by the streams reaching the ancient sea. When this ancient sea 
receded, the sediments were eroded and are now visible in the Badlands 
area of the Pine Ridge Indian Reservation. As wells were developed 
during the last century, the first problem was obtaining an adequate 
supply of water. The second problem was the poor quality of the meager 
supply. The high concentration of chemicals makes the water unfit for 
drinking in all but the southeastern portion of the Reservation.
    The high chemical content of the water and its general lack of 
suitability have made sanitation and ingestion a health issue for our 
tribal members. Before the Mni Wiconi Project enabled us to develop and 
distribute higher-quality groundwater from the southeastern portion of 
our Reservation,\1\ the Indian Health Service attributed high incidence 
of shigellosis, gastroenteritis, hepatitis C and other diseases to poor 
water quality.
---------------------------------------------------------------------------
    \1\ Ancient winds deposited sand over the seabed sediments in this 
area, and the Tribe inherited more suitable water quality in the 
southeastern regions of the Reservation.
---------------------------------------------------------------------------
    The Mni Wiconi Project was designed to develop 50% of our future 
supply from high quality groundwater sources. The remaining 50% will be 
derived from the Missouri River. The diseases listed above are rare 
since the replacement of individual wells and development and 
redistribution of our higher-quality groundwater sources. The remaining 
water supply from the Missouri River will vastly improve water quality 
and reliability, and these former diseases will be eliminated.
    There are other more indirect health benefits associated with the 
project. The Oglala Sioux Tribe has previously requested OMB and the 
White House to form a task force to gather and analyze mortality data 
in South Dakota among the Indian and non-Indian populations and the 
associated costs of healthcare to be borne by the Treasury in the 
future. Poverty on the Pine Ridge Indian Reservation has an additional 
health-care cost, relative to the population not in poverty, estimated 
at $1.2 billion for each 24,000 members of our population over the next 
50 years. Mortality rates among the Indian people are shockingly high 
compared with the rest of the population.
    Death rates in the Indian population due to diabetes are 10 times 
the number of deaths in non-Indian regions for ages over 35 years. 
Similarly, deaths due to heart disease in the Indian population are 
1.67 times the number in the non-Indian population for those under 35 
years of age. Indian deaths attributed to heart disease were 2.10 times 
the number in the non-Indian population for persons between 35 and 59 
years of age. Cancer deaths of Indians greatly exceed those of the non-
Indian population for persons aged 60 and over.
    Extra annual health-care costs for the Indian population were 
estimated using the national costs of health care as set out in the 
table below. Extra health-care costs are for mortality levels above 
that experienced in the non-Indian population of our region. For 
example, 1.25% of the Indian population over 60 died from diabetes 
between 1989 and 1997 as compared with 0.1% of the regional non-Indian 
population.

                                        NATIONAL HEALTH COST INFORMATION
----------------------------------------------------------------------------------------------------------------
                                                            National      National
                                              National      Indirect      Direct in     National      Cost Per
                  Disease                      Deaths         Costs         Costs      Total Costs      Death
                                                           (billion $)   (billion $)   (billion $)
----------------------------------------------------------------------------------------------------------------
Diabetes                                         72,112         $45.2         $46.4        $ 91.6   $ 1,270,246
Heart                                           959,227            --            --         286.5       298,678
Cancer                                          539,533         $37.0          70.0         107.0       198,320
----------------------------------------------------------------------------------------------------------------

    Mortality is inversely correlated with income levels or directly 
correlated with poverty. As income levels decline, mortality increases. 
Other factors, such as genetics, clearly have an influence; but income 
level was shown to explain much of the difference in mortality rates 
between Indian and non-Indian people living in the same area.
    The Mni Wiconi Project is a part of the solution to these 
significant healthcare issues. The project is a foundation. It is 
intended to not only bring safe drinking water to our people, but 
commercial and industrial development and much needed employment. This 
will assist in raising income levels on the Reservation, a step toward 
bringing our people out of poverty. This will, in turn, bring a 
significant improvement in the health of the Oglala Lakota people, 
thereby reducing future health-care costs and, most of all, the agony 
of the families affected.
    Completing the project will have the effect of lowering mortality 
and health-care costs on our Reservation. To the degree that income 
levels have been raised, mortality and associated healthcare costs can 
be expected to decline. We need the appropriations necessary to 
complete the project in 2013 so that the Tribe, its members and can 
realize these benefits and the federal government can realize a savings 
in health care costs.
    The extra health-care cost estimates are of so great a magnitude 
that there is a pressing need to (1) fully evaluate and quantify 
differences in mortality between Indians and non-Indians; (2) correlate 
mortality with income levels; and (3) determine the impact of the Mni 
Wiconi Project on improving the economy of the Pine Ridge Indian 
Reservation and its role thereby in lowering health-care costs. These 
tremendous health-care costs in such a relatively small population of 
our Nation stand as an ongoing human tragedy which demands compassion 
to rectify. Moreover, these costs foretell a considerable drain on the 
federal Treasury that cries out for remedy.

                           CONSTRUCTION COSTS

    Costs of inflation and delays in funding have greatly increased the 
appropriations required to complete the project. Costs have risen from 
$257 million in 1993 dollars to $452 million in 2007 dollars. Much of 
the remaining project costs are for polyvinylchloride (PVC) pipe, which 
is manufactured from oil products that have risen from $35 to $130 per 
barrel over the past year. This has a dramatic impact on the price of 
pipe. The full level of inflation has not yet been realized.
    As shown in the table below, the project will be 81% complete at 
the end of FY 2008. Construction funds remaining to be spent after FY 
2008 will total $87.691 million within the current authorization (in 
October 2007 dollars). PL 110-161 extended the project authorization 
from FY 2008 through FY 2013. Additional administrative and overhead 
costs of extending the project, additional construction costs, and 
accelerated inflation over the next 5 years are expected to increase 
remaining project costs to $137.167 million.


------------------------------------------------------------------------

------------------------------------------------------------------------
Total Federal Construction Funding (Oct 2007 $)          $  451,707,000
Estimated Federal Spent Through FY 2008                  $  364,016,000
% Spent Through FY 2008                                          80.59%
Amount Remaining after 2008
  Total Authorized (Oct 2007 $)                         $    87,691,000
  Overhead Adjustment for Extension to FY 2013           $  109,851,000
 and Other
  Adjusted for Annual Inflation                          $  137,167,000
Completion Fiscal Year (Statutory FY 2013; PL 110-                2,013
 161)
Years to Complete                                                     5
Average Annual Required for Finish                        $  27,433,000
------------------------------------------------------------------------

    Cost indexing over the last five years has averaged 7.89% for 
pipelines. Pipelines are the principal components yet to be completed 
(see chart below)*. Assuming an average 7.89% inflation in construction 
costs in the remaining five years to complete the project, average 
annual funding of $27.433 million for construction is required to 
complete by 2013, the new completion date established just last year. 
The President's budget of $16.24 million is grossly inadequate, departs 
significantly from recent budgets and threatens an undetermined delay 
in completing the project by 2013.
---------------------------------------------------------------------------
    * Chart has been retained in subcommittee files.
---------------------------------------------------------------------------
    Section 2(a)(5) of the Mni Wiconi Project Act specifically finds 
that the United States has a trust responsibility to ensure that 
adequate and safe water supplies are available to meet the economic, 
environmental, water supply and public health needs of the Pine Ridge, 
Lower Brule and Rosebud Indian Reservations. We respectfully request 
that the United States remain mindful of this responsibility and ensure 
the project receives the funds necessary to finish by 2013.

                     RURAL WATER SUPPLY ACT OF 2006

    Our understanding of the intent of Rural Water Supply Act of 2006 
was that the Secretary would prepare a plan on completion of projects, 
including the Mni Wiconi Project, that were authorized but not 
completed prior to 2006 (see extract below). The Oglala Sioux Tribe is 
anxious to work with the Bureau of Reclamation on that plan. We are not 
aware of any progress to date. Before the authorization of new 
projects, including the Red River Valley Project in North Dakota, we 
are hopeful that existing projects can be prioritized and completed.
                               conclusion
    Thank you for the opportunity to present testimony.

    Senator Johnson. President Bordeaux.

 STATEMENT OF RODNEY BORDEAUX, ROSEBUD SIOUX TRIBE, ROSEBUD, SD

    Mr. Bordeaux. Thank you, Senator. Senator Tester, Senator 
Johnson, thank you for this opportunity to be able to present 
testimony today. I am President of the Rosebud Sioux Tribe. The 
Reservation of the Rosebud Sioux Tribe encompasses up to a 
million acres and we serve over 20,000 tribal members.
    Having a safe, reliable supply of high quality water is 
taken for granted by most Americans. On the Rosebud Indian 
Reservation water is respected as a necessity for life and the 
health and welfare of our people. In the 1980s we developed a 
small rural water system that took water from the well field 
near the Rosebud community where high quality ground water is 
available and we provided this to the community of Parmelee 
which is located in Todd County.
    Our tribal leaders had to work with a variety of agencies 
including the Farmer's Home Administration, now referred to as 
Rural Development and the Indian Health Service to expand the 
system to the other parts of the Reservation where good quality 
water was not available. However the funding was a major 
impediment. In 1988 the Mni Wiconi Project was authorized and 
the Rosebud Sioux Tribe was not a part of that project 
initially.
    Representatives of the BOR met with tribal representatives 
and explained the project. They emphasized that the 
participation in the Mni Wiconi Project would not impact the 
reserved water rights. The Secretary of the Interior was 
responsible for paying the planning, design, construction, 
operation and maintenance of the system.
    In the early 1990s our tribal leaders decided it was in our 
best interest to participate in the project because No. 1, 
water lines planned for West River crossed our lands. Number 2, 
it did not affect our reserved water rates. Number 3, it helped 
the United States meet the treaty obligations, 1868 Treaty. 
Number 4, no other source of funding was available to meet our 
water needs.
    I would like to stress the last point which there were 
pressing needs for quality water to improve the health and 
welfare of our Reservation. No program was available to meet 
those needs. So it was in the best interest of the tribe to 
become part of the Mni Wiconi Project.
    We completed a needs assessment in 1993 that identified a 
preferred alternative, excuse me, that would use a combination 
of 62 percent surface water from the Missouri River and 38 
percent ground water from the Oglala aquifer. Rosebud Sioux 
Tribe worked with the Oglala Sioux Tribe, West River/Lyman-
Jones County and the BOR on the final engineering report for 
the project. Public Law 103-434 was passed on October 1994 and 
that amended the Mni Wiconi Project Act to meet the full needs 
of the Oglala Sioux Tribe, West River/Lyman-Jones and added the 
Rosebud Sioux Tribe as well as Lower Brule Sioux Tribe.
    The inclusion of Rosebud Sioux Tribe would not have been 
possible without diligence and perseverance of the BOR, our 
congressional delegates and Senator Johnson, especially, and 
the other sponsors. We gratefully acknowledge that and show our 
appreciation. The Mni Wiconi Rural Water Project comprises 
service areas for both Indians and non-Indians alike and I 
believe this has improved relationships with the non-Indians 
over the past 15 years on our reservation. The BOR has provided 
an even handedness in their oversight of the project that is 
unique and their technical competence is praiseworthy.
    Mni Wiconi has been a blessing. The project is fulfilling 
the vital need for quality water on our reservation. By the end 
of this year we will have close to 75 percent completion. I can 
say that the project has been a success. We have brought high 
quality water to distant corners of Todd and Mellette counties 
and worked with Tripp County Rural Water to serve members of 
the Rosebud Sioux Tribe in Tripp and Gregory Counties which is 
primarily our secondary service area.
    We have brought maps showing the status of our project on 
the Primary as well as the Secondary Service Area. However, we 
must not forget the remaining work to be completed. The 25 
percent remaining is critical and includes the hooking up of 
individual homes, businesses, additional reservoirs and pump 
stations and upgrading obsolete water lines in some communities 
such as Rosebud. We also have Mr. Syed Huq, our water resources 
director. He manages Mni Wiconi and the Rural Water System.
    The project has met critical economic development and 
health needs on the reservation. According to the 2000 census 
the Rosebud Reservation in Todd County is one of the poorest 
counties in the country. Forty-six percent of the population is 
below the poverty level as compared to only 14 percent in South 
Dakota.
    Mni Wiconi water has been used for two economic development 
projects and this year we'll be extending water to serve a 
tribal commercial business center which is in progress. These 
projects provide employment opportunities where none existed 
before. We have also developed direct employment opportunities 
in the form of construction administration and inspection, 
water conservation and tribal construction crews.
    Prior to Mni Wiconi Rosebud Rural Water System, members of 
many communities in the northern part of our Primary Service 
Area had to haul water and water borne diseases were rampant. 
Cases of Gastroenteritis averaged 375 per year between 1981 and 
1986. The occurrence rate for Shigellosis, another water borne 
disease, has been reduced from 22 cases in 1992 to 1 case in 
2000.
    High quality water supplied by Mni Wiconi meets all the 
requirements of the Safe Drinking Water Act. As shown above has 
had a direct impact on the health and welfare of our 
population. Safe drinking water is a source for good health 
resulting in lowering of health care costs for our tribal 
members by Indian Health Service.
    We have developed an excellent working relationship with 
BOR since our early involvement in the project. They have 
supported our efforts to improve the quality of life on the 
reservation. Shown a high level of common sense and flexibility 
in how the Project has been implemented. We have also developed 
an excellent working relationship with not only the Oglala 
Sioux Tribe and Lower Brule, but also with West River/ Lyman-
Jones County Project.
    We have some concerns about the Reclamation's Rural Water 
Program as authorized by the Rural Water Supply Act of 2006. In 
meetings with the Commissioner and his staff, they have 
stressed that they are committed to the timely completion of 
our project. Our concern is that in subsequent Administration's 
water projects authorized through Reclamation's Rural Water 
Program could be favored as the Administration prepares their 
annual budget request for Congress. We hope this does not 
occur. The completion date of our project was extended to 2008 
and now it's up to 2013. Any further extension will prolong the 
waiting list for remaining health care benefits of high quality 
water and we need about 30 million to complete our project at 
Rosebud.
    Tribal members on the reservation perceive Mni Wiconi as 
fulfilling an important trust responsibility of the Federal 
Government to the Indian Tribes. The history of broken treaties 
that have deprived them of land and resources have left the 
tribes angry, poor and distrustful toward the Federal 
Government. Mni Wiconi not only is an economic and public 
health benefits engine to the tribes, it is also building 
social and cultural infrastructure.
    The most important highlights of the Mni Wiconi Project is 
the trust that is being fostered toward the Federal Government 
by the Indian tribes and a precedent for Indians being 
primarily responsible for construction, operation and 
maintenance of one of our largest rural water systems in the 
country. It is also reconciliation at its finest for the 
Indians and non-Indians working together respectfully and 
cooperatively under the umbrella of the U.S. Government, BOR 
and the United States Congress.
    I want to thank you for this opportunity, Senators. I 
appreciate it.
    [The prepared statement of Mr. Bordeaux follows:]

Prepared Statement of Rodney Bordeaux, Rosebud Sioux Tribe, Rosebud, SD

    Mr. Chairman and members of the subcommittee, thank you for the 
opportunity to testify before you today regarding the status of the 
Sicangu Mni Wiconi or Rosebud Sioux Rural Water System and the Rural 
Water Supply Act of 2006.
    My name is Rodney Bordeaux. I am the President of Rosebud Sioux 
Tribe of South Dakota. The Rosebud Reservation comprises over one 
million acres of land with a population of over 20,000.
    Having a safe reliable supply of high quality water is taken for 
granted by most Americans. On the Rosebud Indian Reservation water is 
respected as a necessity for life and the health and welfare for our 
people. In the 1980s we developed a small rural water system that took 
water from a wellfield near the community of Rosebud, where high 
quality groundwater is available, to the community of Parmelee where it 
is not. Our tribal leaders tried to work with a variety of agencies 
including Farmers Home Administration, now generally referred to as 
Rural Development, and the Indian Health Service to expand the system 
to other areas of the reservation where good ground water is not 
available. We struggled without success.
    In 1988, the Mni Wiconi Project was authorized and Rosebud was not 
a part of the project. Representatives of the Bureau of Reclamation met 
with tribal representatives and explained the project. They emphasized 
that participation in the project would not impact our reserved water 
rights and that the Secretary was responsible for paying for the 
planning, design, construction, operation and maintenance of the 
system. In the early 1990s our leaders decided it was in our best 
interests to participate in the project because: 1) water lines planned 
for West River crossed our lands; 2) it did not affect our reserved 
rights; 3) it helped the United States meet treaty obligations to our 
Tribe; and 4) no other source of funding was available to meet our 
pressing water needs.
    I would like to stress the last point. There were pressing needs 
for quality water to improve the health and welfare of our reservation 
and no ``program'' available to meet those needs. It was in the best 
interest of the Tribe to become a part of Mni Wiconi Project. We 
completed a Needs Assessment in 1993 that identified a preferred 
alternative for that would use a combination of 62% surface water from 
Missouri River and 38% groundwater from the Ogallala Aquifer. Rosebud 
worked with the Oglala Sioux Tribe, West River/Lyman--Jones and the 
Bureau of Reclamation on the Final Engineering Report for the project.
    PL 103-434 was passed in October of 1994 that amended the Mni 
Wiconi Project Act to meet the full needs of Oglala Sioux Tribe and 
West River/Lyman Jones and add Rosebud Sioux Tribe and Lower Brule 
Sioux Tribe.
    The inclusion of Rosebud Sioux Tribe would not be possible without 
diligence and perseverance of the Bureau of Reclamation, our 
congressional delegation and the other sponsors and we gratefully 
acknowledge that and show our appreciation. The Mni Wiconi Rural Water 
Project comprises service areas for both Indians and non-Indians and I 
believe has improved relations them over the past 15 years. The Bureau 
of Reclamation has provided an even handedness in their oversight of 
the project that is unique and their technical competence is 
praiseworthy.
    Mni Wiconi has been a blessing. The project is fulfilling the vital 
need for quality water on our reservation. By the end of this year we 
will be close to 75% complete and I can say that the project has been a 
success. We have brought high quality water to distant corners of Todd 
and Mellette counties and worked with Tripp County Rural Water to serve 
members in Tripp and Gregory Counties in our Secondary Service Area. We 
have brought a map showing the status of our project and the Primary 
and Secondary Service Areas. However, we must not forget the remaining 
work to be completed. The 25% remaining is critical and includes 
hooking up individual homes and businesses, additional reservoirs and 
pump stations and upgrading obsolete water lines in some communities 
such as Rosebud.
    The project has met critical economic development and health needs 
on the reservation. According to the 2000 census, the Rosebud 
Reservation in Todd County is one of the poorest counties in the 
country. Forty-six percent of the population is below the poverty level 
as compared to only 14.0 percent in South Dakota. Mni Wiconi water has 
been used for two economic development projects and this year we will 
be extending a water line to serve a tribal commercial center. These 
projects provide employment opportunities where none existed before. We 
have also developed direct employment opportunities in the form of 
construction administration and inspection, water conservation, and 
tribal construction crews.
    Prior to Mni Wiconi Rosebud Rural Water System, members of many 
communities in the northern portion of our Primary Service Area had to 
haul water and water borne diseases were rampant. Cases of 
Gastroenteritis averaged 375 per year between 1981 and 1986 on Rosebud 
Reservation. The occurrence rate for Shigellosis, another water borne 
disease, has been reduced from 22 cases in 1992 to 1 case in 2000.
    The high quality water supplied by Mni Wiconi meets all the 
requirements of the Safe Drinking Water Act and as shown above has a 
direct impact on the health and welfare of our population. Safe 
drinking water is a source for good health resulting in lowering of 
health care costs for our tribal members by Indian Health Service.
    We have developed an excellent working relationship with the Bureau 
of Reclamation since our early involvement in the project. They have 
supported our efforts to improve the quality of life on the reservation 
and shown a high level of common sense and flexibility in how the 
Project has been implemented. We have also developed an excellent 
working relationship with West River/Lyman--Jones in Mellette County.
    We have some concerns about Reclamation's Rural Water Program 
authorized by Rural Water Supply Act of 2006. In meetings with the 
Commissioner and his staff, they have stressed that they are committed 
to the timely completion of our project. Our concern is that in 
subsequent administrations water projects authorized through 
Reclamations Rural Water Program could be favored as the administration 
prepares their annual budget request for submission to Congress. We 
hope this does not occur. The completion date of our project was 
extended to 2008 and now to 2013; any further extension will prolong 
the wait for those remaining to benefit from the high quality water 
provided by the Sicangu Mni Wiconi.
    The tribal members on Rosebud Reservation perceive Mni Wiconi as 
fulfilling an important trust responsibility of the federal government 
to the Indian Tribes. The history of broken treaties that have deprived 
them of land and resources has left the tribes angry, poor and 
distrustful toward the federal government. Mni Wiconi not only is an 
economic and public health benefits engine to the tribes, it also is 
building social and cultural infrastructure. The most important high 
lights of the Mni Wiconi Project is the trust that is being fostered 
towards the federal government by the Indian tribes and a precedent for 
Indians being primarily responsible for construction, operation and 
maintenance of one of the largest rural water system in the country. It 
is also reconciliation at its finest for the Indians and the non-
Indians working together respectfully and cooperatively under the 
umbrella of the U.S. Government-Bureau of Reclamation and U.S. 
Congress.
    Once again thank you for the opportunity to share these thoughts 
and more importantly, your support for this life sustaining project. I 
would be happy to answer any questions you may have.

    Senator Johnson. Yes, thank you, Mr. Bordeaux.
    Chairman Jandreau.

  STATEMENT OF MICHAEL JANDREAU, CHAIRMAN, LOWER BRULE SIOUX 
                     TRIBE, LOWER BRULE, SD

    Mr. Jandreau. Chairman Johnson, Senator Tester, thank you 
very much for scheduling this hearing in South Dakota. I'm 
Michael Jandreau, Chairman of Lower Brule Sioux Tribe. Thank 
you very much for the opportunity to appear before the 
subcommittee.
    Senator Johnson, we greatly appreciate your leadership on 
water issues. The subject of water is of vital importance to 
South Dakota and across the Western United States. Our tribe 
borders the Missouri River. The Big Bend Dam is within our 
reservation and connects us to the Crow Creek Sioux Tribe.
    The Pick-Sloan project took our best bottomlands to build 
the dams on the Missouri River. The dams have greatly benefited 
the United States, but have hurt our Tribe. Senate bill 160, 
which is pending for the Senate Indian Affairs Committee, is 
critical to our Tribe. We will not be able to fulfill our 
potential as a people without the fair compensation for the 
Pick-Sloan project.
    I mention this because it provides a context for how we 
view Mni Wiconi. Mni Wiconi is of great importance to life in 
South Dakota. We support full funding for Mni Wiconi so that 
the potential of the project can be extended to the Oglala 
Sioux Tribe, the Rosebud Sioux Tribe and all the counties 
within the intended scope of services including Lyman and Jones 
counties.
    In March of this year, the Lower Brule Rural Water System's 
Manager, Jim McCauley, joined in testimony to the 
Appropriations Committee that requested $38.4 million for the 
fiscal year 2009. The money would be divided with $28.2 million 
going for construction and $10.2 million for operations and 
maintenance.
    We also request funding for the wastewater treatment. We 
need funding for the treatment and containment of wastewater. 
The proper analysis has yet to be completed and the entire goal 
of the wastewater treatment remains unfunded.
    Mr. Chairman, the longer it takes to fund the project, the 
more it will cost. At Lower Brule, we were able to save $2 to 
$3 million by expedited completion. That was by the cooperation 
of Oglala, Rosebud and West River/Lyman Jones. We're very 
grateful for that.
    We are hoping with your leadership that Mni Wiconi can be 
completed as soon as possible. Thank you very much. I would be 
pleased to answer any questions.
    [The prepared statement of Mr. Jandreau follows:]

  Prepared Statement of Michael Jandreau, Chairman, Lower Brule Sioux 
                         Tribe, Lower Brule, SD

    Chairman Johnson, Members of the Water and Power Subcommittee, 
thank you very much for scheduling this hearing in South Dakota. I am 
Michael Jandreau, the Chairman of the Lower Brule Sioux Tribe; I have 
served in that capacity for 29 years. Thank you very much for the 
opportunity to appear before the Subcommittee.
    Senator Johnson, we greatly appreciate your leadership on water 
issues. The subject of water is of vital importance in South Dakota and 
across the entire Western United States. Our Tribe borders the Missouri 
River. The Big Bend Dam is within our reservation and connects us to 
the Crow Creek Sioux Tribe.
    The Pick-Sloan project took our best bottomlands to build the dams 
on the Missouri River. The dams have greatly benefited the United 
States, but they have hurt our Tribe. S. 160, which is pending before 
the Indian Affairs Committee, is critical to our Tribe. We will not be 
able to fulfill our potential as a people without fair compensation for 
the Pick Sloan project.
    I mention this because it provides a context for how we also view 
Mni Wiconi. Mini Wiconi is of great importance to life in South Dakota. 
We support full funding for Mni Wiconi so that the potential of the 
project can be extended to the Oglala Sioux Tribe, Rosebud, and all 
counties within the intended scope of service including Lyman and Jones 
counties.
    In March of this year, the Lower Brule Rural Water System's 
Manager, Jim McCauley, joined in testimony to the Appropriations 
Committee that requested $38.4 million for Fiscal Year 2009. The money 
would be divided with $28.2 going for construction and $10.2 for 
operation and maintenance.
    We also request funding for wastewater treatment. We need funding 
for the treatment and containment of wastewater. The proper analysis 
has yet to be completed and the entire goal of wastewater treatment 
remains unfunded.
    Mr. Chairman, the longer it takes to fund the project, the more it 
will cost. At Lower Brule we were able to save $2 million-$3 million by 
an expedited completion of the project on our Reservation. We are 
hoping, with your leadership, that Mni Wiconi can be completed as soon 
as possible.
    Thank you very much. I would be pleased to answer any questions.

    Senator Johnson. Mr. Jandreau, thank you.
    Mr. Fitzgerald.

 STATEMENT OF JAKE FITZGERALD, MANAGER, WEST RIVER/LYMAN-JONES 
                 RURAL WATER SYSTEMS, MURDO, SD

    Mr. Fitzgerald. Thank you, Chairman Johnson and Senator 
Tester. My name is Jake Fitzgerald and I'm the Manager of West 
River/Lyman-Jones. West River/Lyman-Jones is a component of the 
Mni Wiconi Project which was authorized in 1988.
    Again, thank you for inviting me to testify before your 
committee and reporting on the progress and success of WR/LJ in 
the Mni Wiconi Project. We are a regional water supply project 
serving over 12,000 square miles in semi-arid Western South 
Dakota. We were authorized almost 20 years ago and we're 
currently in our 15th year of construction.
    Water is essential to the economic viability of Western 
South Dakota. Residents and livestock in the WR/LJ service area 
suffered with limited water supplies and unacceptable water 
quality since the early 1900s. They were required to haul 
drinking water from community sources that did not meet current 
Safe Drinking Water Act standards. Ranchers would sell their 
livestock at reduced prices during each drought cycle. Then 
work to restore their herds once the stock ponds were filled 
again.
    This began to change for the West River/Lyman-Jones area in 
1993 with pipeline construction and a limited supply of the 
famous ``Wall Drug'' water. As stated we are in our 15th year 
of construction. Appropriations have always been less than we 
had hoped, but every new connection brings us closer to the 
completion. Since the ``Turn Dirt'' ceremony in Wall in 1993, 
West River/Lyman-Jones has installed over 3,100 miles of 
pipeline and is delivering quality water to 13 communities, 25 
individual rural residents and the Badlands National Park. This 
project truly has been a Godsend during this multiyear drought.
    The Mni Wiconi project would not have been possible without 
the combined Federal, State and membership funding partnership 
and the tribal and non-tribal cooperative efforts. WR/LJ 
Directors and Mni Wiconi Tribal leadership understood the 
hardship and economic instability brought by unreliable 
supplies of poor drinking water. They took their problem to the 
State Government and congressional leaders and asked for 
assistance. They took water samples and this piece of pipe to 
demonstrate the severity of their problem. This piece of pipe 
is filled with Gypsum found naturally in one of our local 
wells.
    Congress responded with project authorization in 1988 and 
Federal funding based on our ability to pay and the requirement 
of a non-Federal cost share. The State of South Dakota 
responded with a loan on terms that we could afford. The Tribal 
and non-Tribal sponsors, under the oversight of the Bureau of 
Reclamation, are working together to build this project.
    Congress and Federal agencies have set standards for 
drinking water quality to safeguard the people of this country. 
Public water supplies are required to meet those standards. In 
many locations it is not economically feasible to treat local 
water supplies to Safe Drinking Water Act standards.
    A regional water supply project is the solution to 
providing safe and dependable water supplies in many parts of 
the West. A reliable supply of quality drinking water is 
essential to the health of local residents, the traveling 
public and to the livestock industry. The Mni Wiconi Project is 
meeting those needs in Southwestern South Dakota.
    On behalf of the West River/Lyman-Jones membership and your 
constituents in the Mni Wiconi project area I thank you and 
your congressional colleagues for your continued support of 
this project. I urge you to continue congressional support for 
Bureau of Reclamation Rural Water Projects.
    [The prepared statement of Mr. Fitzgerald follows:]

Prepared Statement of Jake Fitzgerald, Manager, West River/Lyman-Jones 
                     Rural Water Systems, Murdo, SD

    Mr. Chairman and Senator Johnson:
    The West River/Lyman-Jones (WR/LJ) Rural Water system is a 
component of the Mni Wiconi Water Supply System authorized by Congress 
in 1988. My name is Jake Fitzgerald and I am the WR/LJ Manager.
    I thank you for the honor of testifying before your Committee and 
reporting on the progress and success of WR/LJ and the Mni Wiconi 
project. We are a regional water supply project serving over 12,000 
square miles in semi-arid Western South Dakota. We are currently under 
construction. However, in spite of being authorized almost 20 years ago 
and under construction for 15 years we are truly a success story.
    Water is essential to the economic viability of western South 
Dakota. However, residents and livestock in the WR/LJ service area 
suffered with limited water supplies and unacceptable water quality 
since their lands were homesteaded in the early 1900's. The people were 
required to haul drinking water from community sources that did not 
meet current Safe Drinking Water Act standards. Ranchers would sell off 
their livestock at reduced prices with each drought cycle and then work 
to restore their herds when the stock ponds were filled again.
    This began to change for the WR/LJ area in 1993 with pipeline 
construction and a limited supply of the famous ``Wall Drug'' water. We 
are now in our 15th year of construction. The appropriations have 
always been less than what we hoped for but every new connection served 
increases the regional project benefits and brings us closer to 
completion. Since the ``Turn Dirt'' ceremony in Wall in 1993 the WR/LJ 
system has installed over 3,100 miles of pipeline and is now delivering 
adequate supplies of quality water to 13 communities, 2,500 individual 
rural connections and the Badlands National Park. This project has been 
a Godsend during what is now the 8th year of sustained drought.
    The Mni Wiconi project would not have been possible without the 
combined Federal, State and water user funding partnership and the 
Tribal and non-Tribal cooperative efforts. WR/LJ Directors and the Mni 
Wiconi Tribal leadership understood the hardship and economic 
instability brought on by unreliable supplies of poor quality water. 
They took their problem to State Government and Congressional leaders 
and asked for assistance. They took water samples and this piece of 
pipe to demonstrate the severity of their problem. This piece of pipe 
is plugged with Gypsum found naturally in a local well.
    Congress responded with project authorization in 1988 and Federal 
funding based on Congressional assessment of our ability to pay and the 
requirement for a non-Federal cost share. The State of South Dakota 
responded with a loan on terms that we could afford. The Tribal and 
non-Tribal sponsors, under the oversight responsibility of the Bureau 
of Reclamation, worked together to build the project.
    Congress and the Federal Agencies have set standards for drinking 
water quality to safeguard the people of this country. Public water 
supplies are required to meet those standards. Individual water 
supplies; rural residents, farmers and ranchers, are not covered by the 
standards. In many locations it is not economically feasible to treat 
the local public water supply to SDWA standards.
    A regional water supply project is the solution to providing safe 
and dependable water supplies in many parts of the semi-arid West. A 
reliable supply of quality drinking water is essential to the health of 
local residents and the traveling public. A reliable supply of quality 
drinking water is essential to the livestock industry. The Mni Wiconi 
Water Supply Project is meeting those regional water supply 
requirements in Southwestern South Dakota.
    On behalf of the WR/LJ membership and your constituents in the Mni 
Wiconi project area I thank you and your Congressional colleagues for 
your continuing support of the Mni Wiconi project. I urge you to 
continue Congressional support of the Bureau of Reclamation's 
implementation of the Rural Water Supply Act of 2006.

    Senator Johnson. Thank you, Mr. Fitzgerald. Mr. Munson, 
Mayor Munson, what are the consequences for meeting Sioux Falls 
predicted water demand if the Lewis and Clark Project is unable 
to provide water to the City by 2012? What do you do then?
    Mr. Munson. That's been our problem, Senator. When we look 
at the--it has a potential to really impact our economy as we 
talk about, you know, our medical, retail, industrial, housing, 
have all been really booming. If we can't make this project a 
reality by 2012 it has a potential to affect all those 
industries and really where we have been continually growing 
each and every year to slow that growth down significantly.
    So it would really, probably, expedite even beyond where 
we're at with conservation measures that we have in place that 
would have to be really stepped up quite a bit. So it has a lot 
of consequences for the economic future of our area.
    Senator Johnson. Is building permits and commercial permits 
under jeopardy in that case?
    Mr. Munson. You know they really would be, when we talk 
about last year, half billion dollars that we had was a record 
year. So if we can't when the businesses looking to relocate to 
Sioux Falls or expanding in Sioux Falls or even houses we would 
probably have to look very carefully at how much growth we 
could experience. So those record years that we're having would 
really, I think, come to a really, I think, come to a real--
they'd start to slow down.
    Senator Johnson. Mr. Larson, as you are well aware BOR's 
recommendation for funding was cut to zero dollars in the 
coming year. Mr. Larson, as the Executive Director of the 
project what sort of reaction was felt among your members and 
has it impacted any planning that you may be doing for the 
longer term?
    Mr. Larson. Mr. Chairman, it was a great deal of 
frustration expressed from our 20 members when zero funding was 
proposed, especially coming off last year with the pre-payment 
by the members. So here was a step of faith that the members 
took, Sioux Falls and 16 other members to pre-pay their share 
of the project. Then to have the Administration propose zero 
right on the heels of that was very disheartening to say the 
least.
    In terms of planning what's--this is over a $500 million 
project. What is so frustrating is not knowing year to year, 
even remotely, how much we're going to get. We have record 
level of $26.5 million. Five weeks later, zero was proposed.
    So what we have done is spent a lot more time and money on 
engineering various contingency plans. What if we only get 
this? What if we only get that? That's money that could be 
spent putting pipeline into ground. We're running a lot of what 
if scenarios.
    Senator Johnson. President Steele, how long--the tribe has 
waited the longest to receive water from the project even 
though the project is nearly 80 percent complete. President 
Steele, when will Missouri River water reach Pine Ridge Indian 
Reservation? What will that achievement mean to your members?
    Mr. Steele. Ah, yes, Senator, this fall we expect that the 
Core line will reach the Northwestern part of our Reservation. 
We figure in August or September. Senator, we are going to 
holding a doings then.
    I don't know, you're going to be busy in Washington. I 
would like to coordinate this to have your presence there. But 
the water will just reach there.
    Now this, Senator, you understand all of these years and 
I've been going testifying, there are five identified projects 
in the United States that use the Indians to get pipelines 
built, but they never reach the Indians. We now have a pipeline 
coming to Pine Ridge and this has been my biggest gripe. You, 
Senator, have been our greatest friend with Senator Thune and 
Congressman Herseth to get this water to Pine Ridge.
    We always expected it to stop and get de-funded. We would 
never get the water. But this fall, Senator. We expect by the 
spring of 2009 to reach the middle of the reservation with this 
water. So this is a means to the people there.
    When we first talked with the people Kadoka and we decided 
to get this pipeline, to see if we could get it built. The 
people in Pine Ridge reared up and they had a referendum vote 
and voted it down. They said that the water would never reach 
Pine Ridge.
    But you, Senator, have gotten it there. It's going to reach 
there this fall. It means a lot to the people of Pine Ridge.
    Senator Johnson. I thank you for your participation and Mr. 
Means participation in turning that thing around.
    President Bordeaux, why is it that the tribe is using a 
combination of ground water and surface water? Is there a 
problem with the ground water contamination? If so, how would 
the Mni Wiconi address this problem?
    Mr. Bordeaux. Well the primary source, prior to Mni Wiconi 
coming along was Oglala aquifer. But we're on the Northern most 
tip of the Oglala aquifer and it comes into half of our county, 
Todd County. Good quality water.
    But looking into the future the Oglala aquifer is drying up 
in places such as Kansas, parts of Colorado, Oklahoma because 
of over pumping irrigation systems. So as far as the future 
looking into several, seven generations at least, so we're 
planning for their needs.
    Some of the contaminants in our water is arsenic in the 
Grossmont area along the White River. There's problems there 
with the wells down there. Nitrate from farming. Pumping the 
aquifer.
    We are monitoring wells. We're finding some of the, I 
guess, the chemicals that are being pumped into the system, 
gets down into the Oglala aquifer. It's contaminating that.
    Then in the city of Mission there's some old gas stations 
there that are leaking fuel storage. So we're working on 
cleaning them. So those are getting into the water system. So 
that's some of the big problems that we have.
    Senator Johnson. Chairman Jandreau, can you please describe 
how the Lower Brule Sioux Tribe carries out its ONM 
responsibilities. As an operating system what are the 
maintenance and operations issues you expect to encounter in 
the next 5 to 10 years.
    Mr. Jandreau. I guess the primary problems that we 
anticipate with the ONM portion of the project that we are now 
pretty much fully into, is the educating of people to 
adequately use the systems that we have placed out there, that 
the rural water systems need a lot of maintenance, a lot of 
care and concern by the individual users to assure that there's 
no wastage, to assure that the quality for contamination or 
guarding against contamination is carefully monitored. We have 
a pretty well trained crew that are out there and active all 
the time. So it's not only been a very beneficial from the 
employment standpoint, but in educating people about the 
necessity of guarding that very precious resource is being 
implemented.
    Senator Johnson. Mr. Fitzgerald, one of the things that is 
unique about Mni Wiconi, I smile at this, is the cowboys don't 
get any water unless the Indians get water. The Indians don't 
get any water unless the cowboys get water.
    [Laughter.]
    Senator Johnson. How is West River/Lyman-Jones been able to 
work with other project sponsors, the tribes and the BOR to 
complete elements of common water transmission facilities?
    Mr. Fitzgerald. I think Mr. Jandreau mentioned briefly, 
where the sponsors work together to manage funds. Advance funds 
to another sponsor when one of the other sponsors show the 
need. I think another good example of that is a cooperative 
agreement with West River/Lyman-Jones and the Oglala Sioux 
Tribe on the North Core system.
    Our fiscal year 2006 and 2007 funds went toward the North 
Core line. That was built with WR/LJ authorized ceiling. We're 
grateful we could work together and do that. It allowed us to 
construct areas around the Core line that were being served 
from that Core line. It also freed up $$17.6 million for the 
Oglala Sioux Tribe in order for them to build facilities on the 
reservation to supply their members.
    Senator Johnson. Senator Tester.
    Senator Tester. Thank you, Senator Johnson. Thank you all 
for being here. I appreciate your testimony. It was all pretty 
complete actually. I do have a few questions.
    First of all, Mayor Munson, you need to be congratulated. 
It sounds like you got a ripping city here. That's a good 
thing.
    I guess this goes to a question that Senator Johnson asked 
Troy Larson that concerns contingencies. How you guys had to 
spend dollars on water contingencies in fear that this project 
won't come to fruition in time to meet your economic demands?
    Mr. Munson. Well, you know, we've been working closely with 
Troy and Lewis and Clark. You know, we have set aside and as I 
said earlier, we pre-paid our $70 million. So that we would, 
you know, to get the water by 2012 becomes crucial for us.
    So we're trying to do the conservation. We're trying to do 
the pre-payment authorization to get the money out there ahead 
of time because of, again, as we talk about--it's imperative 
that we get water. It's just that simple.
    So we're trying to set contingencies through conservation 
is what we're really working at now to make sure as we talk 
about going every day to 12 to 5 o'clock watering. So that 
we're conserving as much as we can with the anticipation that 
Lewis and Clark will be here in 2012. But, you know, so, we are 
working in that direction.
    Senator Tester. You also need to be congratulated on the 
water conservation methods. Maybe we can utilize you in energy 
conservation from a national standpoint.
    Mr. Munson. I think that's something that all of us 
throughout all of the organizations talking here today, we 
always have to be cognizant. We're having to continue on with 
conservation because it is, water is such a precious commodity 
for all of us. As we move forward, I think that's it's going to 
continue to build upon where it's at today. So all of us need 
to be aware of what we can do to protect that resource as much 
as we can.
    Senator Tester. That's a good point. Troy, your charts. I 
think you did a great job in illustrating the different funding 
levels and the total project cost and anticipated completion 
dates.
    I just wanted to give you an opportunity to potentially 
describe how a few dollars now will save money down the line. 
What you see on a percentage basis or a dollar basis, how the 
Federal Government, if they were to fund these projects at this 
point, not only saves you money from a contingency standpoint, 
but could save the Federal Government money in the long term.
    Mr. Larson. Sure, that's a very good question, Senator. The 
old saying, ``a stitch in time saves nine,'' certainly applies 
here. What we are seeing is the inflation indexing, especially 
with steel imports by China is just out of control.
    We've seen inflation as high as 9 percent on this project. 
Last year was close to 5 percent. We expect that to go up again 
this next year.
    Every dollar that gets delayed, that's not a savings by the 
Federal Government. It's a disservice to the taxpayers. Because 
in the long run instead of paying that $1 dollar, that could 
become $3 or $4 down the road depending on the rate of 
inflation.
    That's one of the reasons the members of Lewis and Clark, 
as well as the States have stepped up to the plate and pre-paid 
their share of the project. Not just to keep the project on 
schedule, as best they can, but also to reduce the impacts to 
their taxpayers. We would certainly hope that the Federal 
Government would apply that same common sense as our members 
and our States have.
    But it is a challenge with the runaway inflation. We just 
haven't seen inflation for commodities, not to commodities, but 
copper and stainless steel, everything is just going through 
the roof.
    Senator Tester. Ok. I have a question for Mr. Steele, 
Bordeaux, Jandreau and Fitzgerald. Mr. Steele talked about the 
EPA and allowing you to drink water out of a well that has 
arsenic in it. Has the EPA come in and said, in each of your 
particular cases, that your water doesn't meet standards?
    Mr. Steele. Yes.
    Senator Tester. At this point in time? They have in yours?
    Mr. Steele. Yes. They're temporarily allowing us to use 
those wells realizing that the river water is going to be 
coming in.
    Senator Tester. How long are they allowing you? Just until 
the water comes in?
    Mr. Steele. We understand that the water will, like I said, 
reach the Northwestern part of the Reservation this fall, the 
middle of the Reservation by next year.
    Senator Tester. Ok, good. Mr. Bordeaux, same thing in your 
situation? Has EPA said that your current water system is not 
up to snuff as far as quality?
    Mr. Bordeaux. Especially with the arsenic in the Grossmont 
community.
    Senator Tester. Same thing?
    Mr. Bordeaux. Yes, same thing?
    Senator Tester. Have they given you an extension to use 
your water too?
    Mr. Bordeaux. Not necessarily. We just went ahead with our 
Rural Water System from the aquifer.
    Senator Tester. Ok. Mr. Jandreau.
    Mr. Jandreau. Yes. We don't have that problem because we're 
all along the Rural Water System right now.
    Senator Tester. Gotcha. It meets EPA specs?
    Mr. Jandreau. It meets and exceeds.
    Senator Tester. Good. Mr. Fitzgerald.
    Mr. Fitzgerald. Yes, the communities in our area were high 
in radium. They've got the same notice from South Dakota DENR 
stating that they knew the project was on its way. They gave 
those communities as much time as they needed to get by.
    Senator Tester. Ok
    Mr. Steele. The alpha content in uranium, the radiation in 
the water is way up there.
    Senator Tester. For the three gentlemen from Indian 
country, has the Indian Health Service talked about health 
impacts of the water?
    Mr. Steele. Not really. They are concerned about it. They 
understand the arsenic is there. In some homes they have put in 
filters, in the individual houses. But they never get around to 
change any filters or anything.
    Senator Tester. Right.
    Mr. Steele. Now what IHS can identify is in the Oglala area 
as President Bordeaux said, we had also high nitrites. We had a 
lot of stillborn babies, infant mortalities and those numbers 
have changed. The stillborns is almost nothing. The infants are 
surviving. We took the nitrates out of there with getting some 
other waters in there with the pipeline.
    Senator Tester. Mr. Bordeaux.
    Mr. Bordeaux. They provide some good data in terms of some 
of the problems associated with it. As you know Indian Health 
Services is severely under funded and they're barely keeping 
their head above water. But, you know, they keep close contact 
with us, working with Mr. Hug back here in monitoring a lot of 
that.
    Senator Tester. Ok. Mr. Jandreau.
    Mr. Jandreau. The response is basically the same. The 
reality is as Mr. Bordeaux has pointed out is that Indian 
Health Services capacity to really do anything about it is 
restricted by the funding base.
    Senator Tester. Yes. Last question. This is the toughest 
question you're going to have all day. Mr. Fitzgerald, how long 
did it take for that pipe to build up that much gypsum?
    Mr. Fitzgerald. You know, I can't answer that question.
    Senator Tester. I'm just curious.
    Mr. Fitzgerald. I don't know.
    Senator Tester. That's pretty amazing.
    Mr. Fitzgerald. Yes, I know this piece of pipe went to 
Washington, DC, quite a few times is what I've been told. But 
we kind of use it as a centerpiece in our office.
    Senator Tester. Yes, well it converted that. What is it, 
two, two and a half inch pipe down to about a three inch?
    Mr. Fitzgerald. I believe there was a long stretch of pipe 
with this build up.
    Senator Tester. Just like that. Yes. Three years?
    Mr. Fitzgerald. Three years.
    Senator Tester. That's a lot of gypsum. In any rate, I want 
to thank everybody on this panel. I appreciate your coming in, 
appreciate your bringing in a ground level perspective. So 
thank you.
    Mr. Fitzgerald. Thank you.
    Mr. Steele. Thank you.
    Senator Tester. Senator Johnson.
    Senator Johnson. Yes. It is clear from today's testimony 
that there are sound justifications for a strong national 
commitment to rural water supplies in the Great Plains. Add 
part productivity, add part economic growth as well as serving 
the basic drinking water needs of thousands of people are tied 
to the success of these projects. Without Congress increasing 
the budgets for these projects their benefits would be 
curtailed and the mission of the Bureau's Rural Water Program 
would be in serious jeopardy.
    I want to thank all of the witnesses for agreeing to appear 
before the subcommittee today and for Senator Tester lending 
his voice to these important water issues. I also want to thank 
the preparational staff from the Senate Energy and Natural 
Resources Committee for helping organize this hearing.
    Senator Tester, if you have no further comments, I conclude 
this hearing and remind Senators and staff that questions for 
the hearing record are due by close of business tomorrow.
    Senator Johnson. With that this hearing is adjourned.
    [Whereupon, at 3:42 p.m. the hearing was adjourned.]
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