[Senate Hearing 110-1262]
[From the U.S. Government Publishing Office]


                                                       S. Hrg. 110-1262
 
                         ECONOMIC DEVEPLOPMENT
                        ADMINISTRATION OVERSIGHT

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

                                HEARING

                               BEFORE THE

                    SUBCOMMITTEE ON TRANSPORTATION 
                           AND INFRASTRUCTURE
				
				OF THE 
				
               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS
                          UNITED STATES SENATE

                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                               __________

                             SEPTEMBER 9, 2008

                               __________

  Printed for the use of the Committee on Environment and Public Works
  
  
  
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               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                       ONE HUNDRED TENTH CONGRESS
                             SECOND SESSION

                  BARBARA BOXER, California, Chairman
MAX BAUCUS, Montana                  JAMES M. INHOFE, Oklahoma
JOSEPH I. LIEBERMAN, Connecticut     JOHN W. WARNER, Virginia
THOMAS R. CARPER, Delaware           GEORGE V. VOINOVICH, Ohio
HILLARY RODHAM CLINTON, New York     JOHNNY ISAKSON, Georgia
FRANK R. LAUTENBERG, New Jersey      DAVID VITTER, Louisiana
BENJAMIN L. CARDIN, Maryland         LARRY E. CRAIG, Idaho
BERNARD SANDERS, Vermont             LAMAR ALEXANDER, Tennessee
AMY KLOBUCHAR, Minnesota             CHRISTOPHER S. BOND, Missouri
SHELDON WHITEHOUSE, Rhode Island
JOHN BARRASSO, Wyoming

       Bettina Poirier, Majority Staff Director and Chief Counsel
                Andrew Wheeler, Minority Staff Director
                              ----------                              

           Subcommittee on Transportation and Infrustructure

                     BAUCUS, MAX, Montana, Chairman
THOMAS R. CARPER, Delaware           JOHNNY ISAKSON, Georgia
HILLARY RODHAM CLINTON, New York     JOHN WARNER, Virginia
BENJAMIN L. CARDIN, Maryland         GEORGE V. VOINOVICH, Ohio
BERNARD SANDERS, Vermont             DAVID VITTER, Louisiana
BARBARA BOXER, California (ex        JAMES M. INHOFE, Oklahoma (ex 
    officio)                             officio)
                            C O N T E N T S

                              ----------                              
                                                                   Page

                           SEPTEMBER 9, 2008
                           OPENING STATEMENTS

Cardin, Hon. Benjamin L., U.S. Senator from the State of Maryland     1
Isakson, Hon. Johnny, U.S. Senator from the State of Georgia.....     4
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...     4
Bond, Hon. Christopher, U.S. Senator from the State of Missouri..     6

                               WITNESSES

Erulkar, Benjamin, Deputy Assistant Secretary of Commerce for 
  Economic Development and Eda Chief Operating Officer...........    12
    Prepared statement...........................................    14
    Responses to additional questions from:
        Senator Boxer............................................    21
        Senator Cardin...........................................    24
        Senator Voinovich........................................    27
Zinser, Todd J., Inspector General, United States Department of 
  Commerce.......................................................    29
    Prepared statement...........................................    31
    Responses to additional questions from:
        Senator Boxer............................................    40
        Senator Cardin...........................................    43
Edgerley, David W., Secretary, Maryland Department of Business 
  and Economic Development.......................................    51
    Prepared statement...........................................    53
Mazer, Leanne, Executive Director, Tri-County Council for Western 
  Maryland, President, National Association of Development 
  Organizations..................................................    61
    Prepared statement...........................................    63
    Responses to additional questions from Senator Boxer.........    77
Thoma, Hon. Larry, Mayor, City of Elgin, Oklahoma................    79
    Prepared statement...........................................    81

                          ADDITIONAL MATERIAL

Statement of Hon. Betty Knight, President, National Association 
  of Regional Council; Commissioner, Platte County, Missouri; 
  Board Member, Mid-America Regional Council.....................    91


             ECONOMIC DEVEPLOPMENT ADMINISTRATION OVERSIGHT

                              ----------                              


                       Tuesday, September 9, 2008

                               U.S. Senate,
         Committee on Environment and Public Works,
          Subcommittee on Transportation and Infrastructure
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10 a.m. in room 
406, Dirksen Senate Building, Hon. Benjamin Cardin (chairman of 
the committee) presiding.
    Present: Senators Cardin, Inhofe, Isakson, Bond.

          OPENING STATEMENT OF HON. BENJAMIN CARDIN, 
            U.S. SENATOR FROM THE STATE OF MARYLAND

    Senator Cardin. Good morning. The Subcommittee on 
Transportation and Infrastructure of the Committee on 
Environment and Public Works is conducting an oversight hearing 
on the Economic Development Administration.
    In 1965, Congress and President Lyndon Johnson created the 
Economic Development Administration for job promotion and to 
accelerate industrial and commercial growth in communities 
suffering from limited job opportunities, low per capita income 
levels or similar economic distress. An agency within the 
Department of Commerce, EDA's stated mission is to ``lead the 
Federal economic development agenda by promoting innovation and 
competitiveness, preparing America's regions for growth and 
success in the worldwide economy.''
    As the only Federal agency focusing solely on promoting 
private sector job growth in economically under-served 
communities, EDA pursues regional comprehensive strategic 
development, public works and business loan funds. Working in 
partnership with State and local government, regional economic 
development organizations, public and private non-profit 
organizations, universities and Indian tribes, EDA provides 
grants to help communities. These investments go toward 
revitalization, expansion or upgrading of physical 
infrastructure in order to attract new industries, encourage 
business expansion and diversify local economies.
    In so doing, EDA seeks to establish foundations that enable 
communities to develop their own economic development programs 
for sustained development. In some instances, economic problems 
may be associated with long-term, chronic conditions. In other 
cases, communities may need economic assistance in recovering 
from natural disasters or unforeseen challenges. According to 
an independent auditor, EDA has established a proven record of 
success. Using increasingly limited resources, EDA is still 
able to complete projects in a timely manner that leverage 
private sector investment. In my home State of Maryland, for 
example, EDA has supported 14 projects in the last 2 years that 
are credited with creating 1,875 jobs and leveraging $160 
million in private investment.
    According to EDA's congressional testimony, EDA helps 
create new American jobs at a cost of only $2,825 per job. And 
the agency's succeeds in leveraging over $28 in private sector 
investment for every dollar we invest. In a few minutes, we 
will be hearing from the Deputy Assistant Secretary to detail 
EDA's accomplishments and challenges. The Department of 
Commerce Inspector General, however, has identified problems in 
the management of EDA's revolving loan fund. A lack of 
accounting controls and other factors led the IG to issue a 
number of recommendations to improve the efficiency of this key 
EDA program. We will be hearing more from the IG in a few 
moments about his findings and recommendations and his report 
will be made part of our record.
    We will be hearing from those who are in the front lines of 
economic development, our State and regional councils and local 
governments. It is here that EDA's funded programs actually 
create or retain jobs. During our second panel, we will hear 
today from these key customers about their experiences with 
EDA. The current authorization for EDA expires at the end of 
September. So we don't have a lot of time.
    Key questions must be considered during reauthorization, 
including the funding levels. Although we authorize $500 
million annually, the EDA receives considerably less than that 
amount. They only receive about $280 million in fiscal years 
2007 and 2008. This marks a reduction of nearly 40 percent of 
the 2001 levels, when EDA was funded at $440 million, including 
$287 million for EDA public works programs.
    For Fiscal Year 2009, the Administration proposes to cut 
EDA's budget by more than half again, down to $133 million. In 
so doing, the Administration's proposal would virtually 
eliminate the public works program altogether. I find this hard 
to understand, when we are in tough economic times and trying 
to create more jobs, why the Administration's budget would 
actually reduce a program that is aimed at creating more jobs, 
particularly in difficult communities.
    The Senate Appropriations Committee recently adopted its 
Fiscal Year 2009 Commerce-Justice-Science Appropriation Bill, 
which included EDA funding. In its present form, the bill 
restores most of the President's cuts, but still cuts the 
program by more than $47 million. The bulk of the cuts come in 
the reduction of EDA's public works programs. The Senate 
Appropriation measure maintains a level funding for EDA's 
planning grant program at $27 million.
    This hearing will focus on reauthorization priorities, 
funding levels, oversight and future expectations for EDA. We 
will hear from two panels of witnesses. The first panel will 
consist of two witnesses, Deputy Assistant Secretary from the 
Department of Commerce and the Department's Inspector General. 
The second panel will include key constituents utilizing EDA's 
programs, the State of Maryland Secretary of Business and 
Economic Development, the President of the National Association 
of Development of Organization and the Mayor of Elgin, 
Oklahoma. We are anxious to hear their perspectives from across 
America.
    Before we turn to the panelists, I would first ask my 
colleague, the Ranking Member of the Subcommittee, Senator 
Isakson, for his opening comments.
    [The prepared statement of Senator Cardin follows:]

          Statement of Hon. Benjamin L. Cardin, U.S. Senator 
                       from the State of Maryland

    Good morning.
    Today the Subcommittee on Transportation and Infrastructure 
of the Committee on Environment and Public Works is conducting 
an oversight hearing on the Economic Development 
Administration.
    With the Public Works and Economic Development of 1965, 
Congress and President Lyndon Johnson created the Economic 
Development Administration (EDA) for job promotion and to 
accelerate industrial and commercial growth in communities 
suffering from limited job opportunities, low per capita income 
levels, or similar economic distress. An agency within the 
Department of Commerce, EDA's stated mission is to ``lead the 
Federal economic development agenda by promoting innovation and 
competitiveness, preparing American regions for growth and 
success in the worldwide economy.''
    As the only Federal agency focusing solely on promoting 
private sector job growth in economically underserved 
communities, EDA pursues regional comprehensive strategy 
development, public works, and business loan funds. Working in 
partnership with

     State and local governments,
     regional economic development organizations,
     public and private nonprofit organizations,
     universities, and
     Indian tribes,

    EDA provides grants to help communities.
    These investments go toward revitalization, expansion or 
upgrading of physical infrastructure in order to attract new 
industry, encourage business expansion, and diversify local 
economies. In so doing, EDA seeks to establish foundations that 
enable communities to develop their own economic development 
programs for sustained development. In some instances, economic 
problems may be associated with long-term, chronic conditions. 
In other cases, communities may need economic assistance in 
recovering from natural disasters or other unforeseen 
challenges
    According to an independent auditor, EDA has established a 
proven record of using increasingly limited resources to 
complete projects in a timely manner that leverages private 
sector investment. In my home State of Maryland, for example, 
EDA has supported 14 projects in the last 2 years that are 
credited with creating 1,875 jobs and leveraging $160 million 
in private investment.
    According to EDA congressional testimony, EDA helps 
``create new American jobs at a cost of only $2,825 per job,'' 
and the agency succeeds in leveraging ``over $28 in private 
sector investments for every taxpayer dollar we invest.'' In a 
few minutes we will be hearing from the Assistant Secretary to 
detail EDA's accomplishments and challenges.
    The Department of Commerce's Inspector General, however, 
has identified problems in the management of EDA's Revolving 
Loan Fund. A lack of accounting controls and other factors led 
the IG to issue a number of recommendations to improve the 
efficiency of this key EDA program. We will be hearing more 
from the IG in a few minutes about his findings and 
recommendations.
    We will also be hearing from those who are on the front 
lines of economic developmen--our states, regional councils, 
and local governments. It is here that the EDA-funded programs 
actually create or retain jobs. During our second panel we will 
hear today from these key customers about their experiences 
with EDA.
    The current authorization for the Economic Development 
Administration expires at the end of September. Key questions 
must be considered during reauthorization, including funding. 
Although authorized at $500 million annually, the EDA receives 
considerably less than that amount, having received about $280 
million in fiscal years 2007 and 2008. This marks a reduction 
of nearly 40 percent from the 2001 levels when EDA was funded 
at $440 million, including $287 million for the EDA Public 
Works Program. For fiscal year 2009, the administration 
proposes to cut the EDA's budget by more than half again, down 
to $133 million. In so doing, the administration's proposal 
would virtually eliminate the Public Works Program altogether.
    The Senate Appropriations Committee recently adopted its 
fiscal year 2009 Commerce-Justice-Science Appropriations bill, 
which includes EDA funding. In its present form, the bill 
restores most of the President's proposed cuts, but still cuts 
the program by more than $47 million. The bulk of the cut comes 
in a reduction to EDA's Public Works program. The Senate 
appropriations measure maintains level funding for EDA's 
planning grant program at $27 million.
    The hearing will focus on reauthorization priorities, 
funding levels, oversight and future expectations for the 
Economic Development Administration.
    We will hear from two panels of witnesses today. The first 
panel will consist of two witnesses: an Assistant Secretary 
from the Department of Commerce and the Department's Inspector 
General.
    The second panel will include key constituents who utilize 
EDA programs:

     the State of Maryland's Secretary of Business and 
Economic Development,
     the President of the National Association of Development 
Organizations, and
     the Mayor of Elgin, Oklahoma.

    We are anxious to hear their perspectives from across 
America.
    Let me turn to our Ranking Member, Senator Isakson, for any 
opening comments before we hear from our witnesses.

           OPENING STATEMENT OF HON. JOHNNY ISAKSON, 
             U.S. SENATOR FROM THE STATE OF GEORGIA

    Senator Isakson. Thank you very much, Chairman Cardin.
    The Economic Development Administration is a key provider 
of, in fact was the venture capital for the development of jobs 
and economic development and improvement in some of Georgia's 
and the United States' most distressed communities. In my State 
of Georgia, from Dooly County to Tennille, Georgia, which is in 
Washington County, we have seen EDA grants have a dramatic 
impact on small communities in our State.
    I was especially proud that Paulding County Commissioner 
Chairman Jerry Shearin and the board of commissioners of 
Paulding County won EDA's 2007 Excellence in Economic 
Development award for innovation in economic development 
surrounding the new airport in Paulding County. National 
recognition of the innovative plan was for the airport and the 
placement of offices, businesses, adjacent properties and 
economic development in Paulding County.
    While I could talk on and on about the importance of 
innovation, the investment in the future and providing jobs, we 
are here today to hear from each of our panelists, so I will 
turn it back over to you, Chairman Cardin.
    Senator Cardin. Thank you. We have the Ranking Member of 
the full Committee with us today, Senator Inhofe.

          OPENING STATEMENT OF HON. JAMES M. INHOFE, 
            U.S. SENATOR FROM THE STATE OF OKLAHOMA

    Senator Inhofe. Thank you, Mr. Chairman.
    I thank you for having this hearing right now. I think most 
of us, probably all of us at this table up here, would have 
preferred to do this before, to get this done. We are down to 
the wire now, but it can be done. I am particularly pleased to 
welcome Larry Thoma, of Elgin, Oklahoma. There may be some here 
who have never been to Elgin, Oklahoma, but I can tell you, it 
is changing more than any community in America today, isn't it, 
Larry?
    Last month, I was there for the ribbon-cutting ceremony for 
a new facility at Elgin Industrial Park that would have been 
impossible without an EDA grant. The EDA grant that we came 
through was relatively small, it was $2.25 million. As a 
result, we have completed, I don't want to take your speech, 
but this is going to become a major military industrial park, 
probably the foremost industrial park anywhere in America.
    I joined EDA in August in presenting a grant to the city of 
Woodward, to help bring them Woodward Community campus. This 
project will lead to 192 jobs and $1.6 million in private 
investment.
    Mr. Chairman, I have a list here of things that we have 
done in the State of Oklahoma, and the ratios are about the 
same as yours in the State of Maryland. It is about 20 to 1. 
And these things could not have been done if it had not been 
for the Economic Development Administration, for EDA. That is 
why I think it can be reauthorized.
    I am going to ask that my entire statement be made a part 
of the record, and conclude with a conversation I had last 
night, with Jim Oberstar, who is the Chairman of Transportation 
and Infrastructure over in the House. He and I both agree, and 
Senator Cardin agrees, I think all of us up here agree, this 
can be done, we can get this thing done before we go into 
adjournment. I think it is absolutely necessary to do it.
    So whether the vehicle that is used is mine or somebody 
else's is irrelevant. I think it can be done, there is time. 
But this is one of the areas, there are lots of conflicts in 
this Committee, lots of disagreements philosophically. On this, 
I think we all agree, and we agree it needs to be done.
    Thank you, Mr. Chairman.
    [The prepared statement of Senator Inhofe follows:]

            Statement of Hon. James M. Inhofe, U.S. Senator 
                       from the State of Oklahoma

    Thank you Senator Cardin for chairing this hearing on a 
very important topic. I wish we had turned to this topic 
earlier in the year, because I am concerned that this late 
start means we may not have time to actually enact EDA 
reauthorization--such as my bill, S. 3264--before the current 
authorization expires this month. Regardless of timing, though, 
I am glad we are having this hearing, and I am especially 
pleased to welcome Mayor Larry Thoma of Elgin, Oklahoma.
    I was in Elgin last month for a ribbon-cutting ceremony for 
a new facility at the Elgin Industrial Park that would not have 
been possible without EDA investment. I will let Mayor Thoma 
talk about the details of EDA involvement and what it has meant 
to Elgin, but I consider this to be just one of the numerous 
examples of the good work EDA has accomplished working with 
communities struggling with economic distress to bring in 
private investment and jobs in my home State of Oklahoma, as 
well as all across the country.
    I joined EDA in August in presenting a grant to the city of 
Woodward to help build the Woodward Community Campus. This 
project will lead to 192 jobs and $1.6 million in private 
investment. Another recent EDA grant will benefit the city of 
Watts and Adair County by supporting the construction of 
infrastructure improvements to accommodate the development of a 
new state-of-the-art plastic recycling and composite building 
material manufacturing facility.
    Since the fall of 2004 when we last reauthorized the 
agency, EDA investments in Oklahoma include support for 
industrial park improvements in Ardmore and Hobart, intended to 
generate more than $6.6 million in private investment in 
Ardmore and help create 120 jobs in Hobart.
    We saved and created new jobs in Clinton with water system 
improvements necessary to provide fire suppression protection 
for residents and current and prospective businesses. We paved 
the way for thousands of new jobs in Oklahoma City by helping 
provide the infrastructure necessary for a new Dell service 
center.
    EDA assisted the Choctaw Nation of Oklahoma fund 
construction of an assembly facility for a next generation 
tactical vehicle trailer for the U.S. Marine Corps in Durant, 
Oklahoma. Also in the Durant area, EDA funds were used to 
create additional space to manufacture and assemble goods in an 
expanded Foreign Trade Zone.
    Additionally, many of the economic development districts in 
Oklahoma have received EDA grants to provide valuable planning 
and technical assistance to help communities build local 
capacity to focus on long-term economic and social challenges. 
These planning grants can be critical in particular to small, 
rural communities which often cannot otherwise afford to 
maintain this professional and technical capacity.
    Taken all together, EDA's public works and economic 
adjustment grants awarded in my home State over the past five 
and a half years have resulted in almost 9,000 jobs being 
created or saved. With an investment of about $24.6 million, we 
have leveraged almost 29 million in State and local dollars and 
more than 433 million in private sector dollars. I would call 
that a wonderful success story.
    These numbers are backed up by studies that show that EDA 
uses Federal dollars efficiently and effectively, creating and 
retaining long-term jobs at an average cost that is among the 
lowest in government. Today's hearing gives us an opportunity 
to discuss possible tools to improve performance even further 
during the reauthorization process.
    The EDA's authorization is set to expire just three short 
weeks from today, on September 30, 2008. I am concerned that 
allowing this authorization to lapse will result in uncertainty 
for this very successful agency and the struggling communities 
that depend on its assistance. I recently spoke with 
Congressman Jim Oberstar, Chairman of the House Transportation 
and Infrastructure Committee; we both agreed that we need to 
work together to get this done before Congress recesses or 
adjourns this month, and we both believe that we can get it 
done if we work quickly and together. I look forward to working 
with my colleagues here on the Committee and in the House, as 
well as with the Administration and interested stakeholders, to 
reauthorize EDA as soon as possible.

    Senator Cardin. Thank you for your comments. I know that 
Senator Baucus and Senator Boxer both are very anxious to see 
whether we can get this done before the authorization expires. 
I thank you very much for your comments.
    Senator Bond.

        OPENING STATEMENT OF HON. CHRISTOPHER S. BOND, 
            U.S. SENATOR FROM THE STATE OF MISSOURI

    Senator Bond. Thank you very much, Mr. Chairman and Ranking 
Member Isakson, and our witnesses coming today to talk about a 
very important subject. Your perspectives on the importance of 
understanding the economic impact that EDA has had across the 
Country and how best to craft the reauthorization that improves 
EDA efficiency while continuing to make the United States 
competitive in this changing economic environment will be very 
important.
    I believe the EDA has been successful over the years 
because it has remained true to its main guideline, and that is 
that distressed communities must be empowered to develop and 
implement their own economic revitalization strategy. I have 
had the pleasure of working with many of those communities, and 
where we can get an EDA grant, that has made a tremendous 
difference. In Missouri, EDA grants have been essential to 
local investment in economic growth. For instance, over the 
last 8 years, EDA has implemented over 170 projects, and 
invested more than $38 million in Missouri. During that time, 
EDA funds have led to the creation of over 11,000 jobs in my 
State and leveraged an additional $1.29 billion in private 
sector funds. It has worked to diversify our job base, focusing 
on high tech, high growth industries. This refocusing has 
allowed Missouri to compete globally for private investment 
that attracts and maintains high-paying jobs.
    For example, Mr. Chairman, EDA awarded a $2.9 million grant 
as seed capital for the Center for Research, Technology and 
Entrepreneurial Experience in St. Louis. The funds helped 
immediately leverage over $30 million to create a life science 
research and commercialization district that focuses on 
transforming scientific innovation into new companies to create 
jobs in St. Louis' urban core. In the long run, this research 
center is expected to encourage over $400 million in investment 
by concentrating essential life science resources in one 
community. Not a bad return on a $2.9 million investment.
    In 2005, the Southwest Area Career Center in Monett 
received a $1.25 million EDA grant to build a new facility in 
the career center to accommodate expanding enrollment and offer 
students additional training programs, the type of technical 
and vocational education provided at SWACC is essential in 
creating a well-trained work force and attracting business to 
rural Missouri, and should ensure that southwest Missouri and 
the United States continue to lead in the global economy.
    In the Senate, we are asked to make difficult decisions. 
However, too often we make straightforward decisions difficult. 
We must reauthorize EDA. We must give them the tools and the 
resources necessary to generate good jobs in the areas that 
need them the most, to keep the United States competitive.
    Again, I thank the Chair and the Ranking Member. I look 
forward to hearing and reading the testimony and to working 
together to ensure that EDA continues to be a vital tool to 
help empower economic development.
    Mr. Chairman, I will spare you reading the entire 
statement, and ask that that it be accepted into the record.
    [The prepared statement of Senator Bond follows:]

          Statement of Hon. Christopher S. Bond, U.S. Senator 
                       from the State of Missouri

    First, thank you Chairman Baucus and Ranking Member Isakson 
for holding this hearing today. I am pleased to be here to 
discuss a subject vital to the State of Missouri and the 
country, the reauthorization and oversight of the Economic 
Development Administration.
    In addition, thank you to all the witnesses for appearing 
before us today. Your perspectives on this issue are important 
to understanding the economic impact the EDA has across the 
country and how best to craft a reauthorization that improves 
EDA efficiency while continuing to make the United States 
competitive in this changing economic environment.
    The Economic Development Administration was established 
nearly forty-five years ago under the Public Works and Economic 
Development Act of 1965. During those years, our economy has 
enjoyed significant economic growth and has weathered through 
some tough times. But regardless of the times, there will 
always be distressed regions across our country that lack the 
necessary resources to share in the greater economic success of 
our Nation.
    The EDA has been successful over the years because it has 
remained true to its guideline that ``distressed communities 
must be empowered to develop and implement their own economic 
revitalization strategies.'' The EDA works in partnership with 
State and local governments by providing Federal grants to 
public and private nonprofit organizations, regional economic 
development agencies and Indian tribes. This type of approach 
not only gives distressed communities a voice in Washington but 
also instills the community responsibility and accountability 
that has allowed the EDA to be successful.
    In Missouri, EDA grants have been essential to local 
investment and economic growth. For instance, over the last 8 
years EDA has implemented over 170 projects and invested more 
than $38 million in Missouri. During that time, EDA funds have 
led to the creation of over 11,000 jobs in my State and 
leveraged an additional $1.29 billion in private sector funds.
    The EDA investment in economic development initiatives 
across Missouri has worked to diversify our job base by 
focusing on high-tech, high-growth industries. This refocusing 
has allowed Missouri to compete globally for the private 
investment that attracts and maintain higher paying jobs in the 
area.
    For example, EDA awarded a $2.9 million grant as seed 
capital for the Center of Research, Technology and 
Entrepreneurial Expertise in St. Louis. The Federal funds 
helped immediately leverage over $30 million to create a life 
science research and commercialization district that focuses on 
transforming scientific innovation into new companies to create 
jobs in the St. Louis urban core. In the long run, this 
research center is expected to encourage over $400 million in 
investment by concentrating the essential life science 
resources in one community.
    In 2005, the Southwest Area Career Center in Monett 
received a $1.25 million EDA grant to build a new facility in 
the career center to accommodate expanding enrollment and offer 
students additional training programs. The type of technical 
and vocational education provided at the SWACC is essential in 
creating a well-trained workforce and attracting business to 
rural Missouri and will ensure that Southwest Missouri and the 
United States continue to be a leader in the global economy.
    Here in the Senate we are asked to make difficult 
decisions. However, too often we make straightforward decisions 
difficult. We must reauthorize the EDA and give them the tools 
necessary to generate good jobs in the areas that need them the 
most to keep the United States competitive.
    Again, I thank Senators Baucus and Isakson and the 
witnesses for their hard work. I look forward to hearing your 
testimony and working together to ensure that the EDA continues 
to be a vital tool to help empower economic development.

    Senator Cardin. Without objection, all the opening 
statements will be included in the record.
    I also ask unanimous consent that the statement of Lawrence 
Molnar, President of the Education Association of University 
Centers, be made part of our record.
    [The prepared statement of Mr. Molnar follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Senator Cardin. Without objection, the statements from our 
witnesses will also be included in the record.
    I want to first welcome our first panelists, two 
distinguished public servants, and we very much appreciate your 
being before our Committee. Benjamin Erulkar is the Deputy 
Assistant Secretary for Economic Development and Chief 
Operating Officer at the United States Department of Commerce 
Economic Development Administration. And Tom Zinser is the 
Inspector General of the Department of Commerce.
    Mr. Secretary, we will hear from you first.

 STATEMENT OF BENJAMIN ERULKAR, DEPUTY ASSISTANT SECRETARY OF 
   COMMERCE FOR ECONOMIC DEVELOPMENT AND EDA CHIEF OPERATING 
                            OFFICER

    Mr. Erulkar. Senator Cardin, Ranking Member Isakson and 
members of the Committee, thank you for having me here today to 
testify on behalf of the Administration and the Economic 
Development Administration.
    I am proud of the accomplishments we have achieved at EDA, 
and I look forward to continuing to work closely with Congress 
and our stakeholders to reauthorize EDA and to improve its 
effectiveness even more in the coming years. EDA's mission is 
to lead the Federal economic development agenda by promoting 
innovation and competitiveness, preparing American regions for 
growth and success in the worldwide economy.
    Our investments create the conditions in which jobs are 
created, often in the midst of economic hardship or adjustment. 
For example, in Garrett County, Maryland, EDA investments 
totaling $2.4 million made between 2004 and 2008 have enabled 
that region to launch the transformation from an economy based 
on heavy manufacturing and coal mining to an economy based on 
tourism, light manufacturing and technology. I am proud that at 
EDA, we live our mission statement and are actually achieving 
it, committed to both rural and urban America, with our 
forward-looking and innovative approach to economic 
development.
    From Fiscal Year 2004 to date, EDA has awarded over $1.29 
billion in investments, including construction investments that 
are expected to create over 392,000 jobs at an average cost of 
$2,500 per job. On average for this timeframe, every dollar in 
taxpayer money invested by EDA is expected to attract $33 in 
private capital investment.
    Since 2004, EDA has honed its expertise in responding 
swiftly and effectively to sudden and severe economic 
dislocations. We have invested in redevelopment and rebuilding 
following plant closures in Groveton, New Hampshire, 
Graniteville, South Carolina, and Wilmington, Ohio. We have 
invested in the redevelopment strategies of 11 States affected 
by this summer's floods, part of the $100 million appropriated 
to EDA in June for this purpose.
    Finally, EDA has invested over $34 million in regular 
program funds to rebuild the Gulf Coast following the 2005 
hurricanes that ravaged that region. And the agency is once 
again mobilizing to address economic redevelopment needs in the 
wake of Hurricane Gustav.
    As EDA has celebrated its successes, we have also 
aggressively confronted our challenges; more specifically, the 
administration of its revolving loan fund program. In response 
to the Department of Commerce Inspector General's 2007 report 
on revolving loan funds, EDA developed an action plan 
consisting of 30 elements, on which we are in the home stretch 
toward completion. It has also implemented five of the seven IG 
recommendations and is in the final stages of implementing the 
remaining two.
    The President continues to support EDA and our economic 
development agenda. The President's budget request for Fiscal 
Year 2009 enabled EDA to continue helping distressed 
communities, although it does reflect tough fiscal choices. 
Given these choices, EDA plans to allocate the majority of its 
funds to its economic adjustment assistance program, our most 
flexible assistance program. We also plan to fund fully the 
partnership planning program which supports our network of 
economic development districts nationwide.
    EDA's stakeholders have ideas about how to improve this 
agency and we have been listening. We have made a concerted 
effort to encourage feedback over the past 18 months, resulting 
in the introduction of the Administration's reauthorization 
legislation this past May. We have taken note of ideas offered 
in meetings by 232 economic development districts from 32 
States during this time and have included in our proposal 
provisions that give economic development professionals more 
local control and flexibility in their use of EDA investments.
    Senator Cardin, Ranking Member Isakson and members of the 
Committee, thank you for your time today and for inviting me to 
address the issues relevant to EDA's reauthorization. Since 
2001, the President, Congress and EDA have showed a commitment 
to advancing this agency and economic development throughout 
America. I believe that EDA will continue to be a driver for 
innovation, entrepreneurship, growth and competitiveness in 
distressed areas of our Country. I therefore look forward to 
working closely with Congress on reauthorization and urge that 
an EDA reauthorization bill be acted upon this year.
    I look forward to answering any questions you may have.
    [The prepared statement of Mr. Erulkar follows:]
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    Senator Cardin. Thank you very much for your testimony.
    Mr. Zinser.

 STATEMENT OF TODD J. ZINSER, INSPECTOR GENERAL, UNITED STATES 
                     DEPARTMENT OF COMMERCE

    Mr. Zinser. Thank you, Mr. Chairman, Ranking Member 
Isakson, Senator Inhofe, Senator Bond. We appreciate the 
invitation to testify today on our oversight of the Economic 
Development Administration.
    EDA is one of six grant-making agencies in the Department 
of Commerce that together typically dispense between $1.5 
billion and $2 billion a year to support a variety of economic, 
scientific and technological initiatives. In Fiscal Year 2007, 
EDA grants totaled approximately $250 million.
    For the past 7 years, we have focused our work on EDA's two 
largest programs, grants for public works and the Revolving 
Loan Fund program. During that period, we audited 50 individual 
Revolving Loan Funds, and in 2007, issued a report on EDA's 
overall management of the program. The revolving loan fund 
program established in 1975 represents a significant Federal 
investment. EDA estimates there are currently 584 entities 
operating revolving loan funds with combined portfolios worth 
approximately $850 million. But at the time of our March 2007 
review, staff assigned to monitor and manage the program 
averaged only one person in each of EDA's six regions.
    As part of our 2007 review, we looked at what actions EDA 
has taken to address the problems we had raised in our audit 
reports over the years and that EDA had itself recognized. We 
found that EDA had not made sufficient progress in 
strengthening management of the revolving loan fund program. 
Specifically, we found that , No. 1, EDA did not have a useful 
central data base containing current, accurate information on 
revolving loan fund balances or an adequate tracking and 
oversight system, something an EDA task force recommended the 
agency implement in 1999.
    No. 2, recipients were still maintaining excess cash. EDA 
requires grantees to ensure that a substantial percentage of 
EDA loan funds, typically 75 percent, is loaned out at all 
times. We determined that 236 of the reporting funds had a 
combined total of $70 million in excess cash, roughly $57 
million of that amount represented the Federal share. EDA did 
not have clear guidance for their regions to ensure the 
revolving loan funds did not accumulate excess cash.
    No. 3, the recipients were not meeting reporting 
requirements. Revolving loan funds are required to file annual 
or semi-annual reports with EDA. We found that approximately 39 
percent of the active funds that had filed reports filed them 
late. Nearly 40 percent of the late reports were filed more 
than 90 days beyond the due date. Thirteen percent did not file 
reports at all. In addition, we found many of the reports that 
were filed were inaccurate.
    No. 4, EDA was not effectively using single audit reports 
to manage fund assets. We found that nearly 25 percent of 197 
grantees had not filed single audit reports. Single audit 
reports are required by law for revolving loan funds with 
annual Federal expenditures of $500,000 or more. These audit 
reports are important oversight tools and EDA officials should 
ensure that one, grantees have audits conducted and filed with 
the Federal clearinghouse, and two, regional staff use the 
information in the reports to help manage the program.
    We recommended that EDA develop a comprehensive strategy 
and action plan that has specific, measurable goals and 
milestones built on strong oversight from the top down. In 
response, EDA developed a 30-point action plan and has met or 
is making good progress in meeting its milestones.
    The most significant outstanding action item is the 
development and implementation of a central automated data base 
that provides current, reliable information on the entire 
revolving loan fund portfolio. Such a data base is under 
development and is now scheduled to be in place by the spring 
of 2009. In our view, EDA's new system will be a significant 
step forward and EDA needs to follow through and make sure it 
happens on time.
    Finally, Mr. Chairman, with respect to our oversight of 
EDA's public work grants, we have conducted ten audits of 
public work grants over the past several years. In that same 
period, we have also conducted several criminal investigations 
of EDA recipients. Admittedly, our work covers only a very 
small fraction of the EDA projects across the country. Public 
works projects account for the bulk of EDA's program spending 
with more than $2.8 billion in awards for more than 1,000 
active grants. While our audit and investigative work is not 
sufficient for us to project conclusions about the entire 
portfolio of public works grants, our results do underscore the 
need for strong oversight of these projects.
    Mr. Chairman, that concludes my statement. I would be 
pleased to answer any questions that you or the members of the 
Subcommittee might have.
    [The prepared statement of Mr. Zinser follows:]
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    Senator Cardin. Again, thank you for being here today.
    Mr. Secretary, I would like to get your assessment. We are 
going through high levels of unemployment, highest in at least 
recent years. The challenges for communities to find funds in 
order to move forward on economic development programs are 
becoming more difficult with local budgets, particularly. The 
credit problems, we know what just happened recently with the 
takeover of Fannie Mae and Freddie Mac, and the credit issues 
are difficult, so the revolving funds become even more 
important as it relates to those entities that otherwise could 
not get the capital they need for business expansion.
    Do you share the view that the EDA programs are even more 
important today because of the current economic conditions?
    Mr. Erulkar. I do share the view that EDA programs continue 
to be vitally important and that is why we make the statement 
today that it is vitally important to reauthorize EDA. 
Anticipating your next question, in terms of the current 
problems that our economy is confronting today, EDA is not a 
short-term stimulus agency. We recognize these issues and we 
incorporate them into our strategic investment plans that go 
out a number of years.
    So the funds that we invested today will not even begin to 
show results until three or six or 9 years down the line. That 
is when we do our reporting of them. I do share your view that 
EDA is vitally important for our economy.
    Senator Cardin. And you point out that you are leveraging 
33 to 1, I think the number I used for Maryland was 28 to 1. 
But impressive numbers that you are leveraging in private 
capital. And your strategic plan, I take it, is based upon the 
funds that have been made available to Congress, by Congress.
    Mr. Erulkar. Our strategic plan goes out for 3 years. So we 
have a limited window. In fact, actually it is the basis for 
our budget call. So we look at the economic conditions in each 
of our service areas in developing the projected demand for EDA 
programs.
    Senator Cardin. So let me get to the part of your statement 
with which I strongly disagree, and I think there is bipartisan 
support for my position. This program has been supported in the 
Appropriations Committee and the Authorizations Committee. 
Actually, the Authorizations Committee at a $500 million level. 
The appropriators have consistently appropriated about $280 
million, which has not been on a partisan basis.
    And yet you are defending a cut to $133 million, if I 
understand correctly, most of the money would come out of the 
public works side of it, in your strategic long-term plan. I 
don't understand that. Maybe you can try to help enlighten me 
as to why you believe a program that you tout as being so 
successful, that depends upon getting capital out in the 
community, should be cut by that number.
    Mr. Erulkar. There is no doubt that the budget numbers 
proposed by the Administration will result in fewer projects 
being invested. However, this is a very tough budget 
environment all around. The Department and the Administration 
have been forced to make some very difficult choices in 
crafting its budget proposal. EDA is a scalable agency. That is 
to say, it can operate on widely varying levels of program 
appropriations. Given competing priorities, the decision was 
made to ramp down slightly EDA for the forthcoming year, while 
preserving its institutional capacity fully so that it can be 
ramped up by future Administrations.
    Senator Cardin. Well, that is not slightly, that is a 
significant reduction. I feel more comfortable if you do what 
we all do, just blame OMB rather than--your programs are 
vitally important. We know that. And we know that this type of 
cut would be extremely damaging and would take away a lot of 
capacity. The Inspector General's report is very serious. I 
have read this report, these are very serious issues. We have 
money sitting around that could have been put back into the 
community, perhaps create more job opportunities and could be 
put to the use that Congress intended. We are not exactly clear 
of the status of some of these funds as far as the value of 
some of the assets that are in there.
    As I read it, it seems like at least one of the concerns is 
that perhaps you don't have the personnel to properly do this, 
the number of people. I don't know. So I see from your 
testimony that you have responded and accepted the Inspector 
General's report. Let me just ask the Inspector General, if I 
might, are you satisfied with the replies that you have gotten 
from the agency in regard to the recommendations that you have 
made?
    Mr. Zinser. Yes, sir. My take on the agency's response to 
our 2007 report is that it was a sea change in how EDA 
responded to our previous audit findings. I think they are 
taking the report seriously. They did jump on the 
recommendations. They did develop their action plan and they 
have made significant progress on it.
    Senator Cardin. Thank you.
    Senator Isakson.
    Senator Isakson. Thank you, Mr. Chair.
    Following up on that, your IG report, one of the things 
that was pointed out was maintaining excess cash in reserve for 
long periods of time rather than ensuring the funds were being 
utilized to make loans as required. Would you elaborate on that 
just a little bit, what you meant by that?
    Mr. Zinser. Yes, sir. Once the revolving loan funds are 
capitalized, EDA requires that a substantial portion of those 
funds, typically 75 percent, are always out on the street 
working. And what we found when we went out and audited these 
revolving loan funds is that in many cases, they had excess 
cash that was not being loaned out.
    And I am not entirely clear on why that happens. I think 
there is a variety of reasons. One of the things I would do is 
try to find out what the various factors are. Some have been 
suggested to us.
    But when the cash sits in the account of the revolving loan 
fund and earns interest, then the revolving loan fund can use 
that money that they earned for operating expenses. And I think 
that is one of the reasons why excess cash may sit around. So 
EDA has certain tools that they can use to incentivize, so to 
speak, the revolving loan fund to move that money. I think 
there is some work to be done on improving that situation.
    Senator Isakson. Mr. Secretary, as a former developer, many 
loans are staged in their funding. You don't deploy all the 
cash upon the origination of the loan, but it is staged and 
conditional. I would guess the revolving loan fund works that 
way, is that correct?
    Mr. Erulkar. I believe that is correct, the scheduled 
disbursements.
    Senator Isakson. So was it the interest earned on the money 
that was the inducement to have more in reserve, or were you 
just holding in reserve money for future commitments that had 
been made but not yet funded?
    Mr. Erulkar. Well, it is the RLF itself that is withholding 
the money. It is not EDA. We invest in the fund, we fully 
capitalize it. The question is how efficiently do they use it.
    Mr. Zinser. If I could just add, the calculation on excess 
funds includes the type of scheduling that you are referring 
to. This is above and beyond the normal----
    Senator Isakson. This was over and above the retained funds 
for future deployment based on commitments that had already 
been made?
    Mr. Zinser. Yes, sir.
    Senator Isakson. OK.
    Mr. Secretary, in my State of Georgia, we have a county 
known as Sumter County. It is where Americus, Georgia is. It 
has a hospital, Sumter Regional Hospital, which was completely 
destroyed by a tornado. This is a huge hospital that serves 17 
rural counties in Georgia, as well as a significant part of the 
downtown business district was destroyed in its entirety. Many 
of the doctors have left to go to other hospitals. The 
community is in dire need of a lot of help, which I am trying 
to give them. One of the things they are seeking is emergency 
funds through EDA. And it is my understanding they have 
requested, through the Atlanta office, a statement of 
eligibility or determination of eligibility for them to 
participate in your disaster funds. Atlanta has told them they 
are waiting to hear from Washington as to whether or not Sumter 
County would be eligible.
    So my request is, if you would followup on that for me and 
see what the Atlanta EDA office, and if there is anything EDA 
can do to get the information to Sumter County and Americus as 
to what they would need to do to be able to qualify, I would 
greatly appreciate it.
    Mr. Erulkar. I will certainly followup on that. And I will 
say that EDA has acted pretty quickly to allocate funds from 
the $100 million supplemental that it received in late June. 
Our Atlanta regional office received around $9 million of that 
$100 million for FEMA disaster-declared areas within its 
service area. So I will certainly followup to determine the 
status of that.
    Senator Isakson. I would appreciate it very much.
    And just out of curiosity, do you know what the mix is 
between the funds you deploy, urban versus rural?
    Mr. Erulkar. Yes. We have a historic commitment to 
maintaining our presence, our investment presence in rural 
America. The most recent funds I have for construction projects 
last year indicate that a majority of EDA's construction funds 
were invested in rural areas, upwards of 63 percent. I would be 
happy to get back to you with more detailed figures on that. 
But EDA's commitment to effective investments in rural America 
remains unchallenged.
    Senator Isakson. Thank you very much for your testimony.
    Mr. Erulkar. Thank you.
    Senator Cardin. Senator Inhofe.
    Senator Inhofe. Mr. Secretary, I don't have any specific 
requests on followup. It has been working very, very well. You 
hear so much criticism of Government in general, EDA has been, 
I think, has historically been operating very, very well.
    Something that Senator Isakson just asked about, rural 
versus urban, I don't know what the ratio is, I had to ask my 
staff, almost all of ours in Oklahoma is rural. We have a 
couple of projects, but it is probably, I would say, ten to 
one. And that might be indicative of, representative also of 
some of the rest of the States.
    In my opening remarks I talked about my strong feelings as 
to why this reauthorization should take place before 
adjournment. And I know that you are nodding in agreement, as 
is I think everyone at this table up here, Democrats and 
Republicans. Let me just ask you one question. Tell me, what 
would be the consequences of not doing it before adjournment?
    Mr. Erulkar. I think the main consequence would be, 
honestly, a message of uncertainty about the Government's 
commitment to putting best practice economic development tools 
in place in the distressed areas of America that need them 
most. That is, I think, the real consequence.
    My unvarnished opinion is that given what EDA does, it 
should be, in our Government, a no-brainer to reauthorize it, 
given its results, given the reaction of the communities that 
they have in receiving our investments, in putting together 
effective projects that build economic prosperity. I think that 
the message of uncertainty would leave a real question mark 
about Government's commitment to this kind of program, 
especially given the change of Administration.
    Senator Inhofe. The uncertainty is a concern that we would 
have. I know in my State of Oklahoma, we had one case where the 
application was made, I won't mention it, I wouldn't want to do 
that because it would be pointing fingers, but the application 
was made, and then the money, when it came in, was going to be 
used for a different purpose. And we turned it around and 
returned it. Because to me, the integrity of something that is 
working well is important to protect. I would hate to go back 
to southern Oklahoma and some of the areas that were previously 
pretty impoverished parts of the State and tell them that the 
program that they are probably most proud of, of everything 
that the Government does, is not reauthorizing. It would be 
very hard to sell. So we will work together to try to make that 
happen.
    I don't have any more questions.
    Senator Cardin. I have one or two more questions, then if 
my colleagues have some additional questions, they will have an 
opportunity to ask them.
    Mr. Secretary, the Administration's reauthorization program 
seeks to divert 2 percent of the program's funds to administer 
a new revolving loan fund tracking and management program. 
Could you clarify whether those funds would come out of the EDA 
program or would they come out of the revolving fund? How do 
you anticipate that operating?
    Mr. Erulkar. The 2 percent of funds for administration of 
the RLF program would come out of the Economic Adjustment 
Assistance program appropriation. I will underscore that those 
funds for administration are needed because of the unique 
nature of the RLF program within EDA. There are 584 separate 
RLF operating units today that manage over $849 million of 
assets. The program itself, capitalizing funds, administering 
and monitoring loans, is just a different and fairly large 
animal within EDA's program portfolio. We need those extra 
resources to devote the special attention that the program 
requires to keep it operating effectively.
    Senator Cardin. And you are seeking increased authorization 
for salaries and expenses accounts. Is that consistent with 
what you just said or is that a separate area that you are 
asking for additional funds? And where do those funds come out 
of?
    Mr. Erulkar. The salary and expenses budget request of the 
Administration is a separate account from the Economic 
Adjustment program account.
    Senator Cardin. So you are seeking additional 
administrative support there, also?
    Mr. Erulkar. Our budget request for 2009 is level with that 
of 2008, the amount appropriated in 2008. That is $30.8 
million.
    Senator Cardin. So you are not seeking additional funds for 
salaries?
    Mr. Erulkar. No, sir.
    Senator Cardin. I have no additional questions. Senator 
Isakson?
    Senator Isakson. No further questions, thank you.
    Senator Cardin. Senator Inhofe, any additional questions?
    Senator Inhofe. No, thank you.
    Senator Cardin. Thank you very much.
    We will now turn to our second panel. We are pleased to 
welcome Secretary David Edgerley, who is the Secretary of the 
Maryland Department of Business and Economic Development; 
Leanne Mazer, the Executive Director of the Tri-County Council 
for Western Maryland, on behalf of the National Association of 
Development Organizations; and Hon. Larry Thoma, Mayor, city of 
Elgin, Oklahoma. We are particularly pleased to have all three 
of you here, but I am particularly pleased that two of my 
fellow Marylanders are on this panel. They both have a 
distinguished record. Secretary Edgerley is our principal 
economic person for Maryland under the O'Malley administration, 
does a great job. And Ms. Mazer, who comes from the western 
part of our State, one of the most beautiful spots, that has 
benefited greatly by EDA partnerships.
    It is a pleasure to have all three of you with us today. 
Mr. Mayor, you have been acknowledged by Senator Inhofe, it is 
a pleasure to have you with us here today.
    We will start with the Secretary. Mr. Secretary. Your 
statements will be included in their entirety in the record.

STATEMENT OF DAVID W. EDGERLEY, SECRETARY, MARYLAND DEPARTMENT 
              OF BUSINESS AND ECONOMIC DEVELOPMENT

    Mr. Edgerley. Thank you very much. Good morning again, 
Chairman Cardin, Senator Isakson and distinguished members of 
the Subcommittee.
    I would just like to say that I am particularly and 
personally honored to have been asked to be with you today to 
offer my perspective in the Economic Development Administration 
and what the assistance has meant to not only all of Maryland, 
but more particularly the distressed communities in areas of 
Maryland. Most importantly, I would like to express my full 
support for the reenactment at the level that is supported by 
my colleague, Leanne Mazer, and the National Association of 
Development Organizations. I think we will talk about that a 
little bit.
    But just in the last 5 years, I can let you know that EDA 
has approved investments in Maryland which totaled well in 
excess of $13 million, leveraging a quarter of a billion 
dollars in private sector investment and thousands and 
thousands of jobs for Marylanders that don't just speak to the 
numbers. If you think about the areas that these jobs reside 
in, those areas sometimes of geographic isolation, of histories 
of losing significant portions of the employment infrastructure 
to foreign competition, product obsolescence and the lack of 
reinvestment in major plant and equipment by American industry, 
I think EDA offers a remarkable kind of foundation in its 
efforts to rebuild and jump start those areas needing a nimble 
agency's help more than others.
    There are phenomenal numbers and there is concrete 
evidence, I think, that EDA has done a good job, continues to 
work with important communities throughout the Nation and 
creates jobs, boosting local economic vitality. I really 
commend the work that they have done.
    In my brief time with you this morning, I would like to 
share with you my personal experience with EDA on a couple of 
projects. And I stand ready to answer any questions that you 
might have.
    But I would like to start with an event, many years ago, as 
a young professional leaving college, working in the middle of 
Appalachian Maryland, as an employee of a community action 
agency with all of 6 months' tenure, I wrote my first grants 
under Title 10 of the Job Opportunities Program with EDA, which 
put essentially 1 percent of the people that were unemployed at 
the time back to work for a year. I saw first-hand the value of 
creating each and every job and why it was important to 
families that needed help so desperately.
    We also had experience in the early days of revolving loan 
funds, and I would offer that in revolving loan funds, having a 
cash balance is a good thing, that you have money to lend in 
important times of heightening credit issues with financial 
institutions that it is nice to have money to lend so that you 
don't have to wait for payments to be made before new loans can 
be put out.
    EDA invested in six of the seven business parks that are 
within the boundaries of Allegany County, where I guided 
economic development for almost 20 years. Those parks today 
house about 10 to 15 percent of the entire work force of 
Allegany County, if they were all Maryland residents. You may 
know that is a narrow part of Maryland with regional boundaries 
that involve three States.
    For counties that don't have the tax base or bonding 
capacity to take advantage of many Federal programs, EDA stands 
ready to do its important work in partnership with State 
government and local entities, bridging digital divides, 
working with rural broadband, working with the infrastructure 
needed to build technology parks around the State. We currently 
are working with the development of a new park in Dorchester 
County at Cambridge to lay the important groundwork for jobs to 
be created on the Eastern Shore of Maryland. And very 
importantly, a strategic project at East Baltimore Development, 
Inc., or EBDI, as it is known, is taking investments from the 
State, the city and EDA to new levels to build a technology-
rich biopark adjacent to the Johns Hopkins medical campus in 
Baltimore, which is a cornerstone of building new economy jobs 
for our significant cities.
    States relying on EDA funding across the Country are 
enjoying the benefits of having these selective public 
investments move our economy forward. I would suggest that it 
is not time to pull back on any funding to EDA. Thank you very 
much.
    [The prepared statement of Mr. Edgerley follows:]
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    Senator Cardin. Mr. Secretary, thank you very much.
    Ms. Mazer.

   STATEMENT OF LEANNE MAZER, EXECUTIVE DIRECTOR, TRI-COUNTY 
 COUNCIL FOR WESTERN MARYLAND, PRESIDENT, NATIONAL ASSOCIATION 
                  OF DEVELOPMENT ORGANIZATIONS

    Ms. Mazer. Good morning, Mr. Chairman, Ranking Member 
Isakson.
    My name is Leanne Mazer. I currently serve as President of 
the National Association of Development Organizations, and 
Executive Director of Tri-County Council for Western Maryland, 
an EDA-designated economic development district serving the 
three western-most counties in the State. I want to thank you 
for the opportunity to testify today on issues related to the 
reauthorization of EDA.
    Before I get started, I wanted to note that NADO is working 
with a coalition of national groups that includes the National 
Association of Counties, the American Public Works Association, 
The National Association of Regional Councils, University 
Centers and others to proactively promote the reauthorization 
of EDA. First, Mr. Chairman, EDA has proven time and time 
again, both in independent evaluations and in jobs created and 
private sector dollars leveraged, that its programs work 
effectively. Now is the time to ensure its funding reflects its 
accomplishments. In other words, EDA works, and now it needs 
the resources to excel.
    As the only Federal agency focused solely on private sector 
job growth, EDA is a vital resource for localities striving to 
improve their economies. Whether it is through infrastructure 
grants, strategic planning assistance, business development 
capital, EDA investments are uniquely positioned to promote 
economic development in impoverished areas and to help local 
communities improve their connections to the national and 
global economies. Since its inception, EDA has helped create 
over four million jobs and leveraged in excess of $130 billion 
in private sector investments in more than 8,000 communities. 
This is an incredible record for an agency with a modest annual 
budget of under $300 million.
    However, since 2001, as you stated earlier, EDA's funding 
has declined 36 percent and if enacted, the Administration's 
2009 budget request would impose a 53 percent cut below that 
current fiscal year. The Administration's proposed cut could 
potentially result in the loss or delay of $3.8 billion in new 
private sector investment and the loss of more than 36,000 jobs 
in distressed areas. We urge Congress to enact a multi-year 
reauthorization bill for EDA that supports the highest funding 
level possible for the agency's economic development assistance 
programs.
    Second, Mr. Chairman, NADO urges Congress to increase 
funding for EDA's planning program from $27 million to $34.4 
million and provide additional resources for the nationwide 
network of 375 economic development districts. This proven 
program provides essential seed capital and matching funds for 
the national network of EDDs to foster regional cooperation and 
implementation of projects at the local level. Without the 
assistance and expertise of economic development districts, 
most of our local communities, particularly those in small 
metropolitan rural areas, would not be able to package 
infrastructure and development deals.
    EDDs have established an impressive record of facilitating 
comprehensive development strategies that serve as the backbone 
of EDA's success. EDA's on-time project completion rate and 
high rates of leveraging private sector investment in job 
creation would not be possible without the direct involvement 
and participation of the EDDs. We are thankful that this 
Committee recognized the critical value of EDA's planning 
program in the 2004 reauthorization measure and provided a 
minimum level of support for that program of $27 million, which 
was an increase of $3 million over the program's existing 
appropriation level at that time. Increased funding now would 
provide EDDs with the flexibility needed to pursue effective 
job creation strategies, comply with increased Federal 
regulations and mandates and ensure that our under-served 
communities across the Nation are better positioned to overcome 
a new generation of obstacles brought on by global economics.
    Third, Mr. Chairman, we urge Congress to strengthen local 
controls at the EDA's revolving loan funds program. The RLF 
program is one of the most successful and powerful economic 
development tools for addressing credit needs in distressed and 
under-served areas. Locally managed RLFs have provided business 
capital to thousands of new and existing companies that had 
difficulty securing conventional financing. Over the years, EDA 
has provided grants to nearly 600 RLFs with net assets 
approaching the $850 million.
    EDA's RLF program has the unique distinction of being the 
only Federal grant program that never loses its Federal 
identity. The initial RLF grant and any income or interest that 
is derived from it is considered Federal property. RLF 
operators are forced to continually comply with expensive and 
burdensome reporting and audit requirements. Ownership of EDA's 
RLF should be fully transferred to the local intermediaries 
once all of the initial funds have been loaned out, repaid and 
fully resolved. This would also significantly reduce the 
oversight and management burdens on EDA, which they have been 
unable to fulfill, while still ensuring local accountability is 
maintained.
    Finally, Mr. Chairman, we believe there is a need to 
provide stronger and broader incentives to foster regional 
collaborations and partnerships among local governments, the 
private sector and educational non-profits and philanthropic 
institutions through the national network of EDDs. The 2004 
reauthorization bill did establish two new performance award 
programs. Those initiatives are very limited in scope and have 
demonstrated little impact.
    Congress is urged to buildupon the existing set of multi-
jurisdictional EDDs to encourage, facilitate and reward 
regional development activities. Mr. Chairman, members of the 
Subcommittee, thank you again for the opportunity to testify. I 
would also welcome any questions.
    [The prepared statement of Ms. Mazer follows:]
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    Senator Cardin. Thank you very much for your testimony.
    Mayor Thoma.

             STATEMENT OF HON. LARRY THOMA, MAYOR, 
                    CITY OF ELGIN, OKLAHOMA

    Mr. Thoma. Thank you, Mr. Chairman, Ranking Member Isakson, 
Senator Inhofe and members of the Subcommittee, for the 
opportunity to testify today in support of the Economic 
Development Administration.
    My name is Larry Thoma, and I am the mayor of Elgin, a 
small community in southwest Oklahoma, located north of the 
Fort Sill community. I am the immediate past president of the 
Oklahoma Municipal League.
    My main point today, Mr. Chairman, is that the EDA is an 
essential funding resource and partner for small towns and 
rural communities across the United States that are working on 
long-term regional and local economic development strategies 
and projects. Without the gap financing and seed capital for 
infrastructure projects, our economic development blueprints 
would never get off the drawing board.
    We have truly benefited from the great staff at EDA, 
especially with the Austin regional office and their regional 
director, Pedro Garza. These folks have been great public 
servants who understand the needs of our Nation's rural 
communities.
    In addition to its valued project funding, EDA provides 
vital matching funds for a nation of economic development 
districts such as the Association of South Central Oklahoma 
Governments in my region, known as ASCOG. These multi-county 
organizations provide our small communities with much-needed 
staff support and economic development know-how.
    I want to use just a couple of minutes to give you a first-
hand story of how EDA helps small communities like Elgin, 
Oklahoma. Such examples as ours is the reason Senator Inhofe is 
seeking a multi-year reauthorization of EDA in his legislation, 
Senate Bill 3264. In our region, Lawton is the primary commerce 
hub and job center, with a population of more than 90,000. Yet, 
a lot of people choose to live in surrounding communities such 
as Elgin, where there is a low crime rate and an excellent 
school system, and a small town atmosphere with large city 
amenities nearby.
    But due to the BRAC, which Senator Inhofe has worked very 
diligently to help us with, Fort Sill in our area is expected 
to gain over 10,000 people just in the next few years. As a 
result, Elgin is also planning to see a large surge in its 
population. This presents both great opportunities as well as 
challenges from a local government perspective.
    Within the economic development arena, we are building the 
Fort Sill Industrial Park in Elgin. The park has a great access 
to the interState, State highway and rail line. It even has a 
live fire artillery range which is important for attracting 
military service forms working with Fort Sill. With EDA's 
assistance, this property will soon become one of the largest 
economic development projects in southwest Oklahoma. BAE 
Systems already occupies a recently constructed 10,000 square 
foot building in the park.
    Plans are being finalized for construction of a much larger 
facility that the company plans to start leasing in October 
2009. The building and facilities are expected to cost in 
excess of $21 million and BAE Systems plans to invest another 
$9 million in specialized equipment. Within the first 36 months 
of operation, the firm plans to employ at least 41 people with 
an estimated payroll of $1.7 million. They will continue to 
hire incrementally until they reach their production capacity 
with a total work force of 150 to 200 people.
    These numbers may not raise eyebrows in large metropolitan 
areas, but for a rural community of 1,210 people, that is a 
significant development. Without EDA's public works and 
planning funding, Elgin could not even consider shouldering the 
cost of this kind of project by itself. We also could not 
implement a project like the Fort Sill Industrial Park without 
the technical and organizational support provided by ASCOG and 
their help, people like Blaine Smith and Ronnie Ward.
    As with any project, planning is the key to any successful 
endeavor. But it also takes experts to implement the plan. 
Elgin lacks sufficient revenues to hire a full-time city 
manager, maintain an adequate staff responsible for grant 
activities and to hire a project manager for the development of 
an industrial park. EDA and its local planning partners are 
critical to small metropolitan and rural America. We must 
continue to invest more resources in these important 
institutions.
    If America does not adequately invest for our future, our 
children and grandchildren will never enjoy the America that we 
all know and love. Jobs and trades continue to leave for 
foreign markets at an alarming rate. Communities such as Elgin 
are proving that with the proper strategic planning, local 
leadership, intergovernmental partnerships and community 
infrastructure improvements, we can compete on the global 
stage.
    I urge this Committee and the Congress to fully fund the 
U.S. Economic Development Administration and adopt a 5-year 
reauthorization bill to provide the stability and policy 
direction needed for EDA. Thank you again, Mr. Chairman, 
Senator Inhofe and members of this Committee, for the 
opportunity to testify. I would welcome any questions.
    [The prepared statement of Mr. Thoma follows:]
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   Senator Cardin. Thank you, Mayor Thoma. We again appreciate 
your being here and your testimony.
    Each of you has given testimony as to the importance of the 
EDA programs in your community. In Maryland, we have urban 
areas and rural areas. The importance of EDA in Western 
Maryland has been well documented here today. Similar 
testimoneys could be given about the Eastern Shore of Maryland 
or Southern Maryland.
    Ms. Mazer, you talked about getting the necessary planning 
and development assistance, particularly in the rural 
communities through the EDDs, the economic development 
districts. Other than increasing modestly the authorization 
level for the EDDs, do you have any other specific 
recommendations on how we can help rural communities better 
plan for international competition and the challenges of 
globalization as far as economic development is concerned?
    Ms. Mazer. I think really it goes to two things. Obviously, 
having the resources to have professional planning and the CEDS 
process in place in the rural regions. But also, it really goes 
to how do we incentivize our partners in economic development 
to work together. I think a lot of it goes to, it is not a 
natural thing for some of those partners to work together. We 
bring them to the table when we are looking at setting regional 
priorities.
    In Western Maryland, it never ceases to amaze me, when we 
sit down and look at the needs assessment through the CEDS 
process and we look at which communities have the biggest needs 
and which communities have projects that are ready to go, the 
regional consensus is very easy to come to. But when you look 
at the resources that are there, I think the performance awards 
programs that are present at EDA today probably just are not, 
very little impact is being seen from those incentive 
performance award programs. If we could do something through 
those performance award programs to give an incentive for those 
local governments to work together, that goes directly to their 
ability then to do projects that then translate to 
opportunities for businesses to compete globally.
    Senator Cardin. Mr. Secretary, Cumberland is a wonderful 
area. I have worked with their economic development people 
about specific programs. Is there a way that the economic 
development district could be better utilized to help a 
community such as Cumberland, which is struggling to keep jobs 
in competition with urban areas, and then are losing 
opportunities internationally? Is there a way that we can 
better strategize by the use of the EDA programs to help you in 
what you are doing in Maryland to help communities such as 
Cumberland?
    Mr. Edgerley. I think there are a couple of things that 
could be done. First, the reauthorization will give stability 
and certainty, hopefully, and some expectation of the ability 
to plan for longer range projects that offer either 
infrastructure or some public work that is a locational 
incentive to outside investment. As Leanne said, giving the 
opportunity for the planning process to be robust and active 
gives those local officials, opinion makers, the opportunity to 
come together and prioritize where those investments should go.
    Linkages much like ARC does with its regional funding are 
also important for the State of Maryland to step up and join 
with EDA in co-funding revolving funds, co-funding important 
projects. We do this as a matter of course now. Formalizing 
that process is one thing I would commend to you, requiring 
that three-way partnership as opposed to just the two-way 
partnership for municipal, county, State and certainly Federal 
participation in the process.
    Senator Cardin. Thank you for that response.
    I want to give each of you a chance to respond to my final 
question, which is that the Administration's budget would 
reduce the EDA budget by, I think somewhere around 40 percent. 
That is somewhat misleading, because most of the cuts would 
come out of the public works program projects. They would be 
the ones that would get the largest single reduction.
    What impact would that have if we saw that type of a 
reduction in the Federal Government's commitment under EDA, 
what impact would that have in Maryland or in Oklahoma, in your 
city? I would welcome your comments on that. I think Ms. Mazer 
commented directly on it in her testimony. But if any one of 
you wanted to add more, I think it would be helpful. We are 
looking at an authorization level that will allow the 
appropriators the ability to appropriate the necessary funds.
    Mr. Mayor.
    Mr. Thoma. Sir, we opened bids today on our industrial 
park. Today is a landmark day in Elgin, because we opened bids 
on our industrial park, Senator Inhofe. It is a $5 million 
project. So not only is it a $5 million project when you look 
at the EDA funds, it is a $2.25 million, $2.5 million project. 
So not only is it a $5 million project on the industrial park, 
you can't just separate the $2.5 million on EDA, but you also 
have to look at the impact on our city. Because you have all 
those construction jobs. You are not even just looking at the 
impact of the industrial jobs that will come to the park two or 
3 years down the road, you have to look at the impact today. In 
less than 30 days we could have construction jobs coming to our 
community. We are not talking about two to 3 years down the 
road. We are talking about 30 days down the road we could have 
construction jobs coming to Elgin.
    My community exists off of, our sales tax base is $40,000 a 
month. That is a small community. We are talking about rural 
communities, 63 percent of their budget deals with rural 
communities. When you start talking about the impact, really 
does it affect it much, it really does. With all due respect, 
it really does, because these moneys begin to affect the small 
communities, when you start talking about the construction 
costs of these parks. I will start seeing the impact almost 
immediately. I won't see it two or 3 years down the road when 
the park is done, I will see them within 30 to 90 days.
    So it does affect us. It affects us almost immediately. The 
cuts aren't 3 years down the road. They are soon.
    Senator Cardin. I appreciate that.
    Mr. Edgerley. I was going to say some similar things, so I 
echo the comments of the mayor. I also would suggest that, as 
the Secretary mentioned earlier, that EDA offers the 
opportunity for scalability with respect to its programs. It is 
no time to think about scaling down anything that EDA does in 
our economy. I have been working with the agency for 32 years. 
I have seen it in all of its forms except the early period. I 
am fortunate that the program predated me.
    But I have also seen it used throughout its history for 
economic stimulus attributes, job creation attributes, 
strategic planning attributes, and now more than ever, EDA 
serves as either the opportunity or the barrier to allowing 
important, needy areas of our Country to compete with the 
outside world for important investments by the private sector. 
What I mean by that is that many rural areas and many needy 
areas lack the infrastructure to level the playing field. We 
have to do something that make sure that this balance comes 
into play.
    I left Western Maryland to go to Montgomery County and 
participated with others in the creation of 120,000 jobs in 10 
years. So I have seen the remarkable benefits of high growth, 
technology-rich areas, yes, supported by the Federal 
infrastructure in significant part, but I have also worked in 
those challenged areas that need this help to level the playing 
field.
    Now, it doesn't stop there, because companies, despite what 
we might think about getting ready for development, companies 
in our Country still make their own locational decisions. If we 
don't have the right investment in infrastructure, business 
parks, broadband and others, we will foreclose on the 
opportunity for rural America to be at the table as our jobs 
enter the new economy.
    Senator Cardin. Thank you.
    Senator Isakson.
    Senator Isakson. Echoing on that point, if you build it 
they will come is absolutely critical in economic development. 
If you don't have the infrastructure, both in broadband, as you 
mentioned, the infrastructure in terms of water and sewer, the 
park like you are developing, then you are not going to get the 
economic development and the investments. I want to echo that 
wholeheartedly.
    Second, I appreciate your comment on the question about the 
excess funds in reserve as not necessarily a bad thing. It is a 
bad thing if you are using the revenue to underwrite the 
department. But it is a good thing to have to deploy for 
economic development at a moment's notice, almost.
    Ms. Mazer, you made a comment I want to make sure I 
understood. You talked about strengthening local control and 
then you referred to EDA's continuing audit and reporting 
requirements on fully revolved funds. Are they requiring you to 
continue to report after the money has been deployed and 
repaid?
    Ms. Mazer. Absolutely. Those grants are open forever. And 
we report semi-annually or annually forever.
    Senator Isakson. Forever as in it never stops?
    Ms. Mazer. Yes.
    Senator Isakson. Well, that raises an interesting issue. I 
was reading the audit report and the IG was talking about 
inadequate reporting in part of what they said. Then you are 
talking about reporting ad infinitum, I guess, once a loan has 
been made. I think there is a happy balance somewhere in 
between. So I will look into that for you.
    Ms. Mazer. Thank you.
    Senator Isakson. That is a lot of redundancy.
    Mr. Edgerley, you referred to the East Baltimore, Inc. 
biopark. Talking about the multiplier effect, is that thing 
under development now, the biopark?
    Mr. Edgerley. It is indeed. It comprises about 80 acres 
that were acquired in partnership with the city, the State and 
the private sector. An RFP was done to attract a private 
developer to the area, so essentially, that land, dozens and 
dozens of blocks north of Johns Hopkins Medical Center, were 
acquired, many people relocated and that area of blight was 
eliminated to create an epicenter for the Hopkins campus to 
grow and contribute to the community as an employment center, 
strategically located in Baltimore around Hopkins.
    The first building is up, there are tenants in that 
building. It has had, as is normal in a sophisticated project, 
a few struggles. But we continue to heavily invest in it. We 
are looking forward to it building an incubator in various 
communities serving kinds of commercial enterprises as time 
goes on.
    Senator Isakson. How much was the EDA investment 
originally?
    Mr. Edgerley. I don't have the answer to that question, but 
I will be happy to get it for you and the Committee.
    Senator Isakson. Were you around when Rouse re-did the area 
of Baltimore? The Rouse Corporation?
    Mr. Edgerley. The mall area? Yes.
    Senator Isakson. Was EDA any seed money in that 
redevelopment, do you know?
    Mr. Edgerley. That I don't know. I was around, not as 
Secretary of DBED, but I was in Montgomery County.
    Senator Isakson. Mayor Thoma, I would just say that one of 
the important things in the success stories of EDA and economic 
development is good leadership. It is very obvious you are 
providing that for Elgin, Oklahoma. Senator Inhofe has bragged 
about you on numerous occasions. I am glad we had a chance to 
meet you in person.
    Thank you, Mr. Chairman.
    Senator Cardin. Senator Inhofe.
    Senator Inhofe. Thank you, Mr. Chairman.
    First of all, Ms. Mazer, I know that you are interested in 
a reauthorization that would expand local participation in all 
this. You are probably familiar with my bill, perhaps, the 5-
year reauthorization, which doesn't go as far as you would 
like, I am sure. But is it a step in the right direction?
    Ms. Mazer. Absolutely. We were very appreciative of your 
dedicated leadership and support of EDA. We think the bill is a 
great place to start. We are particularly pleased, obviously, 
to see the increased authorization levels over that of the 
Administration's proposal and we absolutely, sincerely 
appreciate your attention to and support of the planning 
program part of the bill.
    Senator Inhofe. Good. Thank you very much. As you know, 
there isn't time to get in to do this the normal way we would, 
where we would be able to sit down and go over these things. 
You, Mr. Secretary, have already made some statements about 
some of the improvements that you would like, and those will be 
all noted.
    So Larry, welcome again. I think that you stated it very 
well, you have a community of about 1,200 people. There are 
lots of communities in Maryland and throughout America that are 
that way. I think that the smaller the community, the greater 
the impact is of something like this.
    I remember when you and I talked about the $2.25 million 
that it would take to accomplish what we are now accomplishing. 
You didn't mention the size of this new park. It is 150,000 
square feet.
    Mr. Thoma. It has actually been bumped up. The size has 
varied over the last little while. It has gone from 150,000 to 
160,000 square feet.
    Senator Inhofe. Has it? That is just since last week when I 
was there.
    Mr. Thoma. Yes. They fluctuate with the money. They have 
kind of gone from 150,000 to 175,000, I think they are back 
down to 165,000 square feet. It may change tomorrow.
    Senator Inhofe. But the point is this: I don't think you 
can sit there and tell us the economic impact of this thing, 
what it is generating, what the future will be. We don't know, 
when you look at the first element of the SCS system being 
assembled there what impact that would have on future elements. 
But I think it would be very positive. I don't see any way that 
we won't be in real serious competition as a result of the 
great asset that is being built there.
    While you are the mayor of Elgin, Oklahoma, nearby Lawton, 
100,000 people or so, all the communities around there are 
affected to a greater or lesser degree. Is there anything else 
that you, since you came a long way, the longest of anyone on 
this panel to be with us today, that you would like to share 
with us concerning the impact of this EDA grant that started 
this whole thing, and what the future looks like for Elgin, 
Oklahoma as a result of the EDA?
    Mr. Thoma. Communities my size, we are a small community 
and we struggle. I have a full-time job, very part-time mayor. 
I can't hire a full-time city manager. I spend a lot of time 
being mayor. There is no way that we can do this by ourselves. 
ASCOG has graciously, with Blaine Smith's approval, has loaned 
us Ronnie Ward, who is a planning coordinator over at ASCOG. He 
has effectively become our city manager through EDA's 
assistance.
    So with their help, we have actually planned this park. We 
have had to hire an engineer. But all this is wrapped up 
through EDA funds. There is no way that this Fort Sill 
Industrial Park, and you have been there, Senator, on several 
occasions, there is no way any of this could have gone off 
successfully without EDA funds. We have since passed a TIF, a 
tax increment financing district, we have gotten some ODOT 
money. There is some Commerce money involved. But all of this 
started with the seed from EDA.
    Senator Inhofe. And an greater extent is the private sector 
investments, now, it overshadows all the public funds for this, 
county or State or Federal, in this project.
    Mr. Chairman, I could have used, you were kind enough to 
let me choose my witness here, I could have used a number of 
other projects that are successful in Oklahoma. But I think 
this one is unique, in the size of the community, the effect on 
the entire part of the State, southwest Oklahoma. I have said 
several times, in fact, I said even when I addressed the 
chamber convention way up northeast of you in Tulsa, that that 
is singularly perhaps the best thing that has happened to the 
State of Oklahoma. Because that is the kind of impact it has. 
So I thank you, all of our witnesses, but particularly you, 
Larry, for coming up here and sharing your story with us.
    Mr. Thoma. Thank you, Senator.
    Senator Cardin. Senator Inhofe, you chose well.
    Senator Inhofe. Thank you, Mr. Chairman.
    Senator Cardin. We very much appreciate all three of the 
witnesses. I think that you have really underscored the point 
that Senator Inhofe made, and that is that we need to get this 
reauthorized before Congress adjourns, for the predictability 
of the program. But also, there is really not any disagreement 
here. We have a few areas, I am sure, we will have to 
negotiate.
    But there is a clear desire to make sure that these 
programs continue. I think, Mr. Mayor, you pointed out that 
this is not about 3 years' planning, it is about jobs today and 
economic growth today. I think also the three of your 
testimoneys underscore the importance of maintaining, and I 
hope expanding, the EDA's presence in our community, certainly 
not cutting it.
    I thank you all for your testimony. It will be helpful to 
us in trying to get this issue resolved before Congress 
adjourns. With that, if there is nothing further, the 
Subcommittee will stand adjourned.
    [Whereupon, at 11:20 a.m., the subcommittee was adjourned.]
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