[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]




 
    AMERICAN RECOVERY AND REINVESTMENT ACT FUNDS FOR THE BUREAU OF 
  RECLAMATION AND THE WATER RESOURCES DIVISION OF THE UNITED STATES 
                       GEOLOGICAL SURVEY (USGS)

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

                           OVERSIGHT HEARING

                               before the

                    SUBCOMMITTEE ON WATER AND POWER

                                 of the

                     COMMITTEE ON NATURAL RESOURCES
                     U.S. HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                               __________

                        Tuesday, April 28, 2009

                               __________

                           Serial No. 111-17

                               __________

       Printed for the use of the Committee on Natural Resources



  Available via the World Wide Web: http://www.gpoaccess.gov/congress/
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                     COMMITTEE ON NATURAL RESOURCES

              NICK J. RAHALL, II, West Virginia, Chairman
          DOC HASTINGS, Washington, Ranking Republican Member

Dale E. Kildee, Michigan             Don Young, Alaska
Eni F.H. Faleomavaega, American      Elton Gallegly, California
    Samoa                            John J. Duncan, Jr., Tennessee
Neil Abercrombie, Hawaii             Jeff Flake, Arizona
Frank Pallone, Jr., New Jersey       Henry E. Brown, Jr., South 
Grace F. Napolitano, California          Carolina
Rush D. Holt, New Jersey             Cathy McMorris Rodgers, Washington
Raul M. Grijalva, Arizona            Louie Gohmert, Texas
Madeleine Z. Bordallo, Guam          Rob Bishop, Utah
Jim Costa, California                Bill Shuster, Pennsylvania
Dan Boren, Oklahoma                  Doug Lamborn, Colorado
Gregorio Sablan, Northern Marianas   Adrian Smith, Nebraska
Martin T. Heinrich, New Mexico       Robert J. Wittman, Virginia
George Miller, California            Paul C. Broun, Georgia
Edward J. Markey, Massachusetts      John Fleming, Louisiana
Peter A. DeFazio, Oregon             Mike Coffman, Colorado
Maurice D. Hinchey, New York         Jason Chaffetz, Utah
Donna M. Christensen, Virgin         Cynthia M. Lummis, Wyoming
    Islands                          Tom McClintock, California
Diana DeGette, Colorado              Bill Cassidy, Louisiana
Ron Kind, Wisconsin
Lois Capps, California
Jay Inslee, Washington
Joe Baca, California
Stephanie Herseth Sandlin, South 
    Dakota
John P. Sarbanes, Maryland
Carol Shea-Porter, New Hampshire
Niki Tsongas, Massachusetts
Frank Kratovil, Jr., Maryland
Pedro R. Pierluisi, Puerto Rico

                     James H. Zoia, Chief of Staff
                       Rick Healy, Chief Counsel
                 Todd Young, Republican Chief of Staff
                 Lisa Pittman, Republican Chief Counsel
                                 ------                                


                    SUBCOMMITTEE ON WATER AND POWER

              GRACE F. NAPOLITANO, California, Chairwoman
     CATHY McMORRIS RODGERS, Washington, Ranking Republican Member

George Miller, California            Adrian Smith, Nebraska
Raul M. Grijalva, Arizona            Mike Coffman, Colorado
Jim Costa, California                Tom McClintock, California
Peter A. DeFazio, Oregon             Doc Hastings, Washington, ex 
Jay Inslee, Washington                   officio
Joe Baca, California
Nick J. Rahall, II, West Virginia, 
    ex officio


                                 ------                                
                                CONTENTS

                              ----------                              
                                                                   Page

Hearing held on Tuesday, April 28, 2009..........................     1

Statement of Members:
    Baca, Hon. Joe, a Representative in Congress from the State 
      of California..............................................    21
    Coffman, Hon. Mike, a Representative in Congress from the 
      State of Colorado..........................................     8
    Costa, Hon. Jim, a Representative in Congress from the State 
      of California..............................................    20
    Hastings, Hon. Doc, a Representative in Congress from the 
      State of Washington........................................     5
        Prepared statement of....................................     6
    McMorris Rodgers, Hon. Cathy, a Representative in Congress 
      from the State of Washington...............................     3
        Prepared statement of....................................     4
    Napolitano, Hon. Grace F., a Representative in Congress from 
      the State of California....................................     2
        Prepared statement of....................................     3
    Radanovich, Hon. George P., a Representative in Congress from 
      the State of California....................................     6
    Smith, Hon. Adrian, a Representative in Congress from the 
      State of Nebraska, Prepared statement of...................     8

Statement of Witnesses:
    Atwater, Richard, Chief Executive Officer, Inland Empire 
      Utilities Agency, on behalf of the WateReuse Association, 
      Chino, California..........................................    40
        Prepared statement of....................................    42
    His Horse is Thunder, Hon. Ron, Chairman, Standing Rock Sioux 
      Tribe, and Chairman, Great Plains Tribal Chairman's 
      Association, Fort Yates, North Dakota......................    27
        Prepared statement of....................................    28
    Keppen, Dan, Executive Director, The Family Farm Alliance, 
      Klamath Falls, Oregon......................................    30
        Prepared statement of....................................    32
    Larsen, Matthew C., Ph.D., Associate Director for Water, U.S. 
      Geological Survey, U.S. Department of the Interior, Reston, 
      Virginia...................................................    22
        Prepared statement of....................................    24
        Response to questions submitted for the record...........    26
    McDonald, J. William, Acting Commissioner, Bureau of 
      Reclamation, U.S. Department of the Interior, Washington, 
      D.C........................................................     9
        Prepared statement of....................................    13
        DOI's April 14, 2009, letter to the Senate and House 
          Appropriations Committees..............................    10
        Response to questions submitted for the record...........    15
    McDowell, Michael L., General Manager, Heartland Consumers 
      Power District, Madison, South Dakota, on behalf of the 
      Midwest Electric Consumers Association and Western States 
      Power Corporation..........................................    47
        Prepared statement of....................................    48


OVERSIGHT HEARING ON ``AMERICAN RECOVERY AND REINVESTMENT ACT FUNDS FOR 
THE BUREAU OF RECLAMATION AND THE WATER RESOURCES DIVISION OF THE U.S. 
                       GEOLOGICAL SURVEY (USGS)''

                              ----------                              


                        Tuesday, April 28, 2009

                     U.S. House of Representatives

                    Subcommittee on Water and Power

                     Committee on Natural Resources

                            Washington, D.C.

                              ----------                              

    The Subcommittee met, pursuant to call, at 10:00 a.m. in 
Room 1324, Longworth House Office Building, Hon. Grace F. 
Napolitano [Chairwoman of the Subcommittee] presiding.
    Present: Representatives Napolitano, McMorris Rodgers, 
Miller, Grijalva, Costa, Baca, Smith, Coffman, and McClintock.
    Also present: Representatives Salazar, Hastings, and 
Radanovich.
    Mrs. Napolitano. Good morning, ladies and gentlemen. The 
Subcommittee on Water and Power will come to order.
    Today's meeting and its purpose is to hold an oversight 
hearing on the ``American Recovery and Reinvestment Act Funds 
for the Bureau of Reclamation and the Water Resources Division 
of the USGS, United States Geological Survey.''
    I ask unanimous consent that Congressman Salazar and 
Congressman Radanovich be allowed to sit on the dais when they 
arrive and participate in the Subcommittee today. No objection?
    [No response.]
    Mrs. Napolitano. After my opening statement, I will 
recognize all the members of the Subcommittee for any statement 
they may have. Any Member who desires to be heard will be 
heard. Additional material may be submitted for the record by 
Members, by witnesses, or by any interested party. The record 
will be kept open for 10 business days following the hearing.
    The five-minute rule for speaking, with a timer which is in 
front, and I have one and you have one, will be enforced. The 
green means go; yellow, you are near the end, please wrap it 
up; and the red means stop, or I will.

       STATEMENT OF THE HONORABLE GRACE F. NAPOLITANO, A 
    REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA

    Mrs. Napolitano. First I would like to commend the Bureau 
of Reclamation and the U.S. Geological Survey for rightly 
prioritizing Title XVI water reuse projects, alleviating the 
rural backlog, and focusing on the streamgage system. Now, I 
realize it is not enough money, given the backlog that 
currently exists. However, we should be happy that we have some 
money to be able to do that, and continue to push every year 
until hopefully we will be able to make some inroads in being 
able to upgrade and maintain.
    I have always been a very firm believer that the firsthand 
effects of Title XVI on a community's water supply are 
critical. The Title XVI program was authorized in 1992, during 
the sixth year of drought in California.
    Since its authorization 17 years ago, Reclamation has 
consistently underfunded, and has been consistently 
unsupportive of this program. I hope you caught the emphasis.
    We now face a third consecutive year of drought conditions, 
and the renewed urgency and importance for Title XVI. This 
program is more crucial now than ever. To quote my friend, Mr. 
Atwater, ``we have reached a point where the consensus exists 
that this program can no longer be an afterthought.''
    I understand you are currently in the process of 
prioritizing which Title XVI projects will receive a part of 
the $135 million of American Recovery and Reinvestment Funds, 
plus $50 million in Fiscal Year 2009 budget. I request that the 
Bureau please provide this Committee and its members a copy of 
the final list as soon as feasible.
    And while we are pleased with the progress shown in 
prioritizing the projects, we still have many unanswered 
questions. For my friend and colleague, Representative Costa, 
his constituents face a dire situation of a third straight year 
of horrible drought conditions in California, in Northern 
California. However, we are also pleased that Reclamation has 
decided to address the balance between ecosystem and water 
delivery upfront--funding restoration projects that restore the 
environment, but also protect water deliveries.
    There are some questions sometimes about why we are 
protecting the ecosystem. Unfortunately, it is not talked about 
very well, but it does protect water.
    I also have some questions about your infrastructure 
portion and the use of our funds for transferred works. 
Reclamation still holds title and liability to these projects 
although operation and maintenance costs are the responsibility 
of the non-Federal agency. Maybe in the underlying discussions 
we need to have at another time, is how we assist these non-
Federal agencies in finding a mechanism for funding these 
programs, so as not to fall in disrepair and later cost the 
taxpayer woes.
    For USGS, now is certainly not the time to lessen our water 
data by discontinuing gauges. And I have some questions 
regarding your streamgage system, and what is going to happen 
to those streamgages that are being rendered inoperable.
    Again, Reclamation and USGS would commend your work in 
prioritizing projects, and look forward to your testimony. To 
all our witnesses I look forward to the reasoning behind 
Reclamation and USGS's prioritized position methods. I also 
want to ensure that through the process, some accountability 
and transparency will be in place to safeguard public funds.
    Now I yield to my friend and Ranking Member, Cathy McMorris 
Rodgers, for her statement.
    [The prepared statement of Mrs. Napolitano follows:]

      Statement of The Honorable Grace F. Napolitano, Chairwoman, 
                    Subcommittee on Water and Power

    First, I would like to commend the Bureau of Reclamation and USGS 
for rightly prioritizing Title XVI water reuse projects, alleviating 
the rural water backlog, and focusing on the streamgage system.
    I have always been a firm believer and have seen firsthand the 
effects of Title XVI on a community's water supply. The Title XVI 
program was authorized in 1992 during the sixth year of drought in 
California. Since its authorization 17 years ago, Reclamation has 
consistently underfunded and has been consistently unsupportive of this 
program. We now face a third consecutive year of drought conditions and 
a renewed urgency and importance for Title XVI. This program is more 
crucial than ever. To quote Mr. Atwater, ``we have reached a point 
where the consensus exists that this program can no longer be an 
afterthought.''
    I understand that you are currently in the process of prioritizing 
which Title XVI projects will receive a part of the $135 million of 
American Recovery and Reinvestment Funds and $50 million in FY 09 
Budget. Please provide the final list to the Subcommittee as soon as 
possible.
    And while we are pleased with the progress Reclamation has shown in 
prioritizing their projects, we still have some unanswered questions. 
For my friend and colleague, Representative Costa, his constituents 
face a dire situation of a third straight year of drought conditions. 
However, we are also pleased that Reclamation has decided to address 
the balance between ecosystem and water delivery upfront--funding 
restoration projects that restore the environment but also protect 
water deliveries.
    I also have some questions about your infrastructure portion, and 
the use of ARRA funds for transferred works. Reclamation still holds 
title and liability to these projects, though operation and maintenance 
costs are the responsibility of the non-federal agency. Maybe the 
underlying discussion we need to have at another time is how we assist 
these non-federal agencies in finding a mechanism for funding these 
programs so as not to fall in disrepair.
    For USGS, now is certainly not the time to lessen our water data by 
discontinuing gages. I have some questions regarding your streamgage 
system.
    Again Reclamation and USGS I commend your work in prioritizing 
projects and look forward to your testimony. To all our witnesses, I 
look forward to your perspective on the reasoning behind Reclamation 
and USGS prioritized decisions methods. I also want to ensure that 
through the process some accountability and transparency will be in 
place in safeguarding public funds.
    I now yield to my friend and Ranking Member, Cathy McMorris Rodgers 
for any statement she may have.
                                 ______
                                 

     STATEMENT OF THE HONORABLE CATHY McMORRIS RODGERS, A 
    REPRESENTATIVE IN CONGRESS FROM THE STATE OF WASHINGTON

    Mrs. McMorris Rodgers. Thank you, Madame Chairman. I thank 
you especially for holding this hearing.
    One of the goals of this Committee is to keep the water 
running and the lights on. And this goal crosses party lines, 
so I appreciate the bipartisanship, cooperation, and effort 
behind this hearing.
    Federal projects have historically provided numerous 
benefits to my district in eastern Washington State. Many of 
our western deserts have been literally transformed into the 
most productive farmland in the world because of these 
legendary projects.
    This infrastructure helped settle the Western part of our 
Nation, win World Wars and, still today, serves as a vital 
function in providing food for domestic and international 
consumers, and also provides important renewable hydropower.
    Much of our infrastructure is in jeopardy, however, because 
of age, environmental litigation, insufficient funding, and 
other factors. In addition, there is a growing debate about the 
future role of the Bureau of Reclamation, the agency that owns 
many of these projects. And the agency's release of the so-
called stimulus funding has only fueled the debate. And the 
debate will be front and center before this Subcommittee today 
as we hear from a diverse panel of witnesses.
    There are numerous questions about the effectiveness and 
allocation of the stimulus funding. For example, was 
infrastructure shortchanged at the expense of ecosystem 
restoration? Why did the Bureau open itself to bipartisan 
criticism for not helping resolve the loss of 60,000 water-
related jobs in California? And how many jobs will be created 
from this funding?
    I look forward to hearing the answers to these questions, 
and hearing how the Bureau will be transparent and accountable 
in conducting its business.
    And in closing, I want to thank the Chairwoman again for 
this hearing. I thank the witnesses for their testimony and 
dedication, and I look forward to working with everyone on this 
important issue.
    [The prepared statement of Mrs. McMorris Rodgers follows:]

          Statement of The Honorable Cathy McMorris Rodgers, 
          Ranking Republican, Subcommittee on Water and Power

    Thank you, Madam Chairwoman, for holding this hearing.
    One of our goals here is to keep the water running and the lights 
on. This goal usually crosses party lines and this hearing represents a 
step in this direction, so I appreciate the bipartisan cooperation and 
effort behind this hearing.
    Federal projects have historically provided numerous benefits to my 
district in eastern Washington State. Much o of our western deserts 
have been literally transformed into the most farmland in the world 
because of these legendary projects. This infrastructure helped settle 
the western part of our Nation, win world wars and still today serves a 
vital function in providing food for domestic and international 
consumers and renewable hydropower.
    Much of our infrastructure is in jeopardy, however, because of age, 
environmental litigation, insufficient funding and other factors. In 
addition, there is a growing debate about the future role of the Bureau 
of Reclamation--the agency that owns many of these projects. The 
agency's release of so-called ``stimulus'' funding has only fueled that 
debate.
    And that debate will be front and center before this Subcommittee 
today as we hear from a diverse panel of witnesses.
    There are numerous questions about the effectiveness and allocation 
of stimulus funding. For example:
      Was infrastructure shortchanged at the expense of 
ecosystem restoration?
      Why did the Bureau open itself to bipartisan criticism 
for not helping resolve the loss of 60,000 water-related jobs in 
California?
      And how many jobs will be created from this funding?
    I look forward to hearing answers to these questions and hearing 
about how the Bureau will be transparent and accountable in how it 
conducts business. This hearing should serve as a good step toward a 
collaborative process. To that end, I expect the agency to meet with 
this Subcommittee and its stakeholders throughout this process.
    In closing, I want to thank the Chairwoman again and thank the 
witnesses for their testimony and dedication. I look forward to working 
with everyone on this important issue.
                                 ______
                                 
    Mrs. Napolitano. Thank you, ma'am. And now we will proceed 
to hear from Doc Hastings.

 STATEMENT OF THE HONORABLE DOC HASTINGS, A REPRESENTATIVE IN 
       CONGRESS FROM THE STATE OF WASHINGTON [EX OFFICIO]

    Mr. Hastings. Thank you, Madame Chairwoman. I thank you 
very much for holding this very important hearing. And I want 
to commend my fellow Republican Members for asking for this 
hearing, and I am glad to join all of you here today.
    Madame Chairman, as you know, water is the lifeblood of 
central Washington and throughout the West. The Bureau of 
Reclamation's multi-purpose projects have formed the economic 
and social fabric of many of our western communities.
    The food grown using Reclamation-delivered water has fed 
millions, both here in America and around the world. The 
Columbia Basin Project and the Yakima Project in my district 
are consistent examples of what is working regionally and for 
America. And they must continue to be part of our working river 
system. Yet they and many other irrigation hydropower projects 
are under constant assault.
    My distinguished colleague from eastern Washington, Cathy 
McMorris Rodgers, just a moment ago spoke about the future of 
the Bureau of Reclamation. Our need for food security and 
domestic jobs must be included in this debate. And as we are 
witnessing in the San Joaquin Valley of California, where 
unemployment hovers around 40 percent because of agricultural 
water that has been diverted because of a three-inch fish.
    People's economic needs must be one of the most important 
parts of this equation. In those contexts, I, and many others 
who understand the importance of our traditional water and 
power infrastructure, had hoped that the Bureau of Reclamation 
would focus much of its funding effort on aging infrastructure.
    In some ways, the agency, frankly, did a good job. But 
overall, the numbers are much lower than many expected, 
especially when comparing them to some of the ecosystem 
restoration in other projects.
    For example, ecosystem restoration funding has been 
allocated to help private, non-Reclamation efforts at the 
Klamath Basin and at Battle Creek, California; and the agency 
will also spend around $14 million on a green building in 
Nevada.
    These projects, Madame Chairwoman, may be worthwhile, but 
some inevitable questions arise when we have $3 billion in 
aging infrastructure backlogs that are directly related to 
Reclamation and its customers. And we have a crisis situation, 
as has been mentioned by both the Chairwoman and the Ranking 
Member in the San Joaquin Valley. And yet the agency has failed 
to ask me how many overall jobs will be created by spending $1 
billion in economic stimulus funding.
    We had also hoped that the agency would use this as an 
opportunity to employ some permit streamlining and reduce 
overhead, so that more money could be used for ``on-the-ground 
purposes,'' when we hear from the Family Farm Alliance today 
about this disappointment, as well.
    And with that, I hope to get some answers today. Madame 
Chairman, I want to thank you again for agreeing to holding 
this hearing. I look forward to working with everyone here 
today on these important matters.
    [The prepared statement of Mr. Hastings follows:]

     Statement of The Honorable Doc Hastings, Ranking Republican, 
                     Committee on Natural Resources

    Thank you, Chairwoman Napolitano, for holding this important 
hearing. I commend my fellow Subcommittee Republicans for asking for 
this hearing and am glad to join everyone here today.
    Water is the lifeblood of Central Washington and throughout the 
West. The Bureau of Reclamation's multi-purpose projects have formed 
the economic and social fabric of many of our western communities. The 
food grown using Reclamation-delivered water has fed millions both here 
in America and around the world. The Columbia Basin and Yakima Projects 
in my district are consistent examples of what's worked regionally and 
for America. And they must continue to be a part of our working river 
systems. Yet, they and many other irrigation and hydropower projects 
are under constant assault.
    My distinguished colleague from eastern Washington, Cathy McMorris 
Rodgers, spoke of the debate about the future of the Bureau of 
Reclamation. Our need for food security and domestic jobs must be 
included in this debate. And, as we are witnessing in the San Joaquin 
Valley of California--where unemployment hovers at 40% because 
agricultural water has been diverted to a three-inch fish--people's 
economic needs must be one of the most important parts of the equation.
    In those contexts, I--and many others who understand the importance 
of our traditional water and power infrastructure--had hoped the Bureau 
of Reclamation would focus much of its funding effort on aging 
infrastructure. In some ways, the agency did a good job. But, overall, 
the numbers are much lower than many expected, especially when 
comparing them to some of the ecosystem restoration and other projects. 
For example, ecosystem restoration funding has been allocated to help 
private, non-Reclamation efforts at the Klamath basin and at Battle 
Creek, California. The agency will also spend $14 million on a green 
building in Nevada. Those projects may be worthwhile, but some 
inevitable questions arise when we have $3 billion in aging 
infrastructure backlogs that are directly related to Reclamation and 
its customers, we have a crisis situation in the San Joaquin Valley, 
and, yet, the agency has failed to estimate how many overall jobs would 
be created by spending one billion dollars of economic stimulus 
funding.
    We had also hoped that the agency would use this as an opportunity 
to employ some permit streamlining and reduce overheard so that more 
money could be used for ``on-the-ground'' purposes. We will hear from 
the Family Farm Alliance today about this disappointment as well.
    With that, I hope to get some answers today. Madam Chairwoman, 
thank you again for agreeing to hold this hearing and for allowing us 
to hear from a diverse panel today. I look forward to working with 
everyone here today on these important matters.
                                 ______
                                 
    Mrs. Napolitano. Thank you, sir. Mr. McClintock, I 
understand you do not have a statement.
    Mr. Radanovich.

      STATEMENT OF THE HONORABLE GEORGE P. RADANOVICH, A 
    REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Radanovich. Good morning, Madame Chairwoman and Ranking 
Member McMorris Rodgers. Thank you very much for allowing me to 
participate back. It is good to be back on the Committee, I 
might add, and offer some opening statements regarding the 
funding for the economic stimulus package and how it may or may 
not affect our situation in California.
    The purpose, Madame Chairwoman, of the American Recovery 
and Reinvestment Act, better known as the Stimulus, was to 
stimulate the economy and create American jobs. In this Act, 
the Bureau of Reclamation was given $1 billion of new stimulus 
funding to responsibly spend on projects that shore up water 
infrastructure and create jobs in America.
    As this Committee is well aware from last month's hearing 
on the California drought, my state is facing a water crisis of 
epic proportions. Three record dry years, in culmination with 
judicial decisions that favor fish over humans, have resulted 
in our current crisis.
    The drought caused in part by the Endangered Species Act 
only enlarges the national economic and financial crisis in the 
San Joaquin Valley. The region represents some of the highest 
foreclosure rates in the country, along with unemployment in 
the cities at 15 percent and growing, not to mention rural 
communities on the west side of Fresno County, which are being 
decimated with 40 percent unemployment.
    Last week the Bureau of Reclamation released new Central 
Valley Project Water Allocation numbers, giving a 10 percent 
allocation to agriculture users south of the Delta. The 10 
percent water allocation in the middle of April means little to 
the farmers who, months ago, made the decision to fallow their 
land or pull out crops because of the 0 percent allocation 
given at the beginning of the year.
    This is a case of too little, too late for many of the ag 
workers in the district who are now without jobs. Times are so 
desperate that many hungry families must now get their food 
from food banks because they can't afford groceries. How ironic 
that this action is necessary in the largest agricultural-
producing county in the nation.
    With this $1 billion of new spending, the Bureau of 
Reclamation can meet the goals of the American Recovery and 
Reinvestment Act by simply moving forward with projects to 
allow Delta pumps to increase pumping, and thereby saving 
thousands of jobs in the San Joaquin Valley at no cost to 
taxpayers.
    According to the University of California, increased 
pumping out of the Delta would save nearly 40,000 jobs in the 
San Joaquin Valley. With many of our cities facing skyrocketing 
unemployment rates, saving 40,000 jobs would have an enormous 
impact on our economy. And yet, no such relief comes to my 
region via this Act. And today I would like to know why.
    I was disappointed, if not stunned, to see that the Two 
Gates Project on the Delta on the Bureau's stimulus was not 
included in the Bureau's stimulus funding project list. The Two 
Gates Project is an immediate and temporary solution to both 
protected, threatened Delta smelt from the pumps, and to 
increase Delta pumping to communities south of the Delta.
    Why wouldn't the Bureau address the biggest factor 
contributing to the California water crisis, and move forward 
with a project to protect the species and increase pumping? And 
why they are not, I can't imagine why this is not happening.
    Solutions to increase pumping in the Delta, such as the Two 
Gates Project, are only temporary. We still must move forward 
with long-term solution, such as additional above-ground water 
storage and a peripheral canal. I encourage the Bureau to be 
responsible in their management of these taxpayer dollars, and 
use them in such a way that creates the most bang for the buck.
    I also look forward to hearing from the Bureau, hearing the 
Bureau answer questions on why they did not include the Two 
Gates Project, and whether funds can be shifted to this 
project. Further, I want to know how the Bureau will 
specifically be spending money, be spending the funding 
assigned to the emergency drought relief, and how many jobs 
they expect to relate with their project list.
    My constituents didn't need a stimulus bill full of funds 
to go to solve problems elsewhere or to clean up the 
environment; they need water. And I want to know why they can't 
get it.
    Thank you very much, Madame Chair.
    Mrs. Napolitano. Thank you, Mr. Radanovich. And we have 
next Adrian Smith.
    Mr. Smith. Madame Chair, I will submit that for the record.
    [The prepared statement of Mr. Smith follows:]

 Statement of The Honorable Adrian Smith, a Representative in Congress 
                       from the State of Nebraska

    Good morning and thank you, Chairwoman Napolitano and Ranking 
Member McMorris Rodgers for holding this important oversight hearing 
today. Representing Nebraska's Third Congressional District, I cannot 
understate the concerns from my constituents when it comes to 
accountability and transparency in how government spends taxpayer 
money.
    The recently enacted American Recovery and Reinvestment Act (P.L. 
111-5) appropriated $1 billion to the Bureau of Reclamation. As we all 
know, Reclamation's primary responsibilities are water and power 
projects and the maintenance of water and power infrastructure, and 
currently there are numerous Reclamation projects in serious need of 
stabilization.
    At a time when farmers are experiencing higher input costs for 
fuel, electricity, feed and other expenses necessary to keep their 
operations going, we must remain mindful of the economic impacts on 
agriculture, especially on those farms dependent on Reclamation 
irrigation projects. Farmers cannot afford rising water costs, and I 
hope we can all agree on the need to repair and safeguard aging 
infrastructure before beginning any new initiatives.
    That said landowners, water users, and other interested parties in 
Nebraska have questioned Reclamation's recent objectives. It is my 
understanding Reclamation recently participated in an arbitration 
hearing concerning the ongoing water dispute between Nebraska and 
Kansas. While the federal government has a role in assisting the state 
with water management, my constituents have raised concerns with this 
action, stressing the importance of state primacy on this sensitive 
issue.
    I look forward to hearing testimony from Bureau of Reclamation 
Acting Commissioner Bill McDonald, and all of our witnesses. I hope 
they will be able to shed light on these important issues.
    Thank you, Chairwoman.
                                 ______
                                 
    Mrs. Napolitano. Thank you. Mr. Coffman, you have no 
statement?
    Mr. Coffman. Yes, I do, Madame Chairman.

 STATEMENT OF THE HONORABLE MIKE COFFMAN, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF COLORADO

    Mr. Coffman. I would like to thank the Chairwoman and 
Ranking Member for holding this hearing today. I would also 
like to thank our witnesses for coming before us.
    The Department of the Interior and the Bureau of 
Reclamation were allocated approximately $1 billion in the 
American Recovery and Reinvestment Act of 2009. As America 
struggles to update its aging water infrastructure, it is vital 
that funds allocated to the Department of Interior are wisely 
spent.
    I, along with many of my colleagues, including Ranking 
Member Hastings, Congresswoman McMorris Rodgers, and Chairwoman 
Napolitano know the importance of water in the West. I look 
forward to ensure with them to ensure that funding allocated to 
the Department of the Interior is spent in a manor that will 
help us reach our current and future water needs. Thank you.
    Mrs. Napolitano. Thank you so very much. And I think we 
will move on to the testimony.
    We have one panel today, and the witnesses will be 
introduced just before they are to testify. After we hear from 
all of you, we will move to questions. All your submitted 
prepared statements will be entered into the record, and all 
witnesses are asked to kindly summarize the high points of your 
testimony, and limit your remarks to five minutes. Again, the 
timer--I am an enforcer, according to Doc Hastings--rule 
applies to questioning for questions, including responses, and 
applies to our members. If there are any additional questions, 
we probably would have a second round.
    For our first panel, we have Mr. Bill McDonald, Acting 
Commissioner for the Bureau of Reclamation here in Washington, 
D.C. We have Dr. Matthew C. Larsen, Associate Director for 
Water at the United States Geological Survey, Water Resources 
Discipline, in Reston, Virginia. Ron His Horse is Thunder, 
Chairman of the Standing Rock Sioux Tribe and Great Plains 
Tribal Chairman Association in Fort Yates, North Dakota. Mr. 
Dan Keppen, Executive Director of Family Farm Alliance from 
Klamath Falls, Oregon. Mr. Richard Atwater, Chief Executive 
Officer and General Manager for the Inland Empire Utilities 
Agency and WateReuse Association in Chino, California. And 
finally, Mr. Mike McDowell, General Manager at the Heartland 
Consumers Power District in Madison, South Dakota.
    Gentlemen, welcome. And we will start with Mr. McDonald.

  STATEMENT OF BILL McDONALD, ACTING COMMISSIONER, BUREAU OF 
                 RECLAMATION, WASHINGTON, D.C.

    Mr. McDonald. Thank you very much, Madame Chairman. I am 
Bill McDonald, the Acting Commissioner of Reclamation. My 
written statement has been submitted for the record. I would 
also request that the Department's April 14, 2009, letter to 
the Chairman and Ranking Members of the Appropriation 
Subcommittees in the Senate and the House, which we have 
previously provided to the Subcommittee staff, be included in 
the record of this hearing, if you would, please.
    Mrs. Napolitano. Without objection, so ordered.
    Mr. McDonald. Thank you.
    [DOI's April 14, 2009, letter to the Senate and House 
Appropriations Committees follows:]

[GRAPHIC] [TIFF OMITTED] T9371.001

    .epsMr. McDonald. As Secretary Salazar announced on April 
15, $945 million is being devoted to Reclamation projects; 
those are summarized in my written testimony and its 
attachment. And there is a complete list of individual projects 
in the April 14 letter to the Appropriations Subcommittee, so I 
will not run through those details. And would simply also note 
that $50 million, as permitted by the Recovery Act, was 
transferred to the Central Utah Project.
    I would like to indicate that in the case of four financial 
assistance programs, the sums to be devoted to them have been 
announced, but the individual announcements have yet to be 
picked. Those programs will provide money for the Title XVI 
Wastewater Reuse and Reclamation projects for our Challenge 
Grant Water Conservation Program, for Title II Colorado River 
Basin Salinity Control Projects, and for Lower Colorado River 
Multi-Species Conservation Plan Projects.
    All of those grants, financial assistance programs are 
underway with competitive selection processes, and project 
evaluation criteria that were posted on Grants.gov website last 
month.
    And finally, $40 million has been set aside for emergency 
drought relief projects to be accomplished in 2009, which will 
focus on the needs of California. Given the situation in 
California, which, as noted, is particularly dire south of the 
Bay Delta; and as I speak, indeed we are in the process of 
identifying drought relief projects, working with the water 
users at a meeting Friday, and continuing with conversations 
this week with the interests in the San Joaquin Valley. And 
through that process, we would expect to identify projects 
eligible for immediate funding under the Drought Relief Act of 
1991 and other authorities, and move quickly to get that $40 
million disbursed.
    Let me turn now to which projects and programs were 
selected. This is discussed at some length in my written 
testimony and in the April 14 letter to the Appropriations 
Subcommittee, so I will just touch on a few highlights.
    First, by way of background, Reclamation began assembly 
information on authorized projects which it would have the 
capability to start or accelerate last summer, as Congress 
began considering legislation that would potentially call on 
Reclamation to rapidly expend millions of dollars for stimulus 
of the economy.
    As the Congressional deliberations proceeded and the scope 
and nature of that potential stimulus package changed over 
time, we collected additional information late in 2008, 
continuing right into January, as this new Congress reconvened. 
And by February, we were already at the point where we were 
refining our information and beginning to make decisions, even 
as we awaited the final passage of the bill.
    The Recovery Act, as you well know, did not authorize new 
projects; it only appropriated money for already authorized 
projects and activities. The projects that were authorized by 
the Omnibus Lands Bill, Public Law 111.11, which was not 
enacted until March 13, simply came too late to be considered, 
except for the Title XVI projects which, because they are going 
through a competitive selection process, have yet to be 
selected and could be considered.
    The Recovery Act and the accompanying conference report 
established a number of requirements to set the basic 
parameters for our project selection process. First, Section 
1603 requires that all funds be obligated by the end of 
physical 2010. That is an absolute requirement that must be 
met.
    In addition, the Recovery Act's conference report that 
indicated that when allocating funds, Reclamation should 
consider projects, programs, and activities which, number one, 
could be executed quickly; number two, have little schedule 
risk; and number three, will be executed by contract or direct 
hire of temporary labor, and will result in high immediate 
employment.
    The Department also directed that we achieve a high rate of 
expenditure, not just obligations, by the end of physical 2010, 
consistent with the spirit of the Act and the President's 
programs. So in short, we placed a very high priority on 
shovel-ready projects.
    The Recovery Act also established minimum funding levels 
for Title XVI projects, rural water projects, and the canal 
inspections programs, so those minimums, as required by 
statute, further informed our decision-making process.
    In the spirit of the Act, Reclamation and the Department 
used a multi-tiered merit-based evaluation process that 
considered the objectives of job creation and advancing 
Reclamation's overall program priorities. After screening the 
projects for the requirements that I just listed, we further 
gave priority to projects that would accelerate construction 
already underway, would achieve more efficient construction 
schedules by doing that, cost reductions, and an earlier 
realization of project benefits.
    The selection process and the criteria, again, are detailed 
in my written testimony and the April 14 letter to the 
Appropriations Committees.
    In the context of that framework and that set of 
requirements and objectives, we reviewed, at the end of the 
day, approximately $2 billion worth of potential projects. 
Since we could consider only authorized projects and 
activities, these were identified based on our fairly regular 
program formulation process or out-year budget projections and 
long-term investment plans.
    Because of this, we generally looked only at extraordinary 
maintenance and replacement work on facilities for which we are 
responsible for budgeting the necessary monies, which we refer 
to as reserved works. The work is reserved, the O&M work is 
reserved to Reclamation.
    Those facilities for which water users have assumed, by 
contract, the responsibility for maintenance at their own 
expense on their own budget, with their own workforce, which we 
refer to as transferred works, were generally not considered, 
because we are not responsible for, and do not budget for, 
those projects and their maintenance.
    To the extent that a few transferred works were brought to 
our attention, we considered them, but they were given a lower 
priority.
    As a result, all the specific projects and the 
infrastructure and reliability and safety investment program 
area ended up being reserved works.
    To the extent that water users would otherwise have to 
advance these monies in the year in which we undertook an 
extraordinary maintenance or replacement activity, we will 
instead employ the new authority that allows for repayment or, 
over a period of time, a further recovery act if that is 
requested by a water user.
    While this authority also could have been applied to 
Transfer Works, the idea of that language came so late in the 
Congressional deliberations, it was not in the House Bill that 
was passed last July; it was not considered and discussed in 
the course of the Fall.
    It came so late long after we had started assembling data, 
that we had moved beyond the point of being able to go back and 
collect information about what water users might have in the 
way of proposed projects; did they have the necessary 
engineering complete; did they have environmental compliance in 
order; could they obligate funds; could they expend. Simply too 
late in the process.
    In conclusion, let me say that the Department will work to 
ensure that the Recovery Act's goals of job creation and 
mission advancement will have maximum transparency to the 
Congress and the public. There are multiple reporting 
requirements built into the Act, all of which we have complied 
with to date. We certainly will continue to do so in the 
future.
    All of our financial assistance possibilities have been 
posted on Grants.gov. The information that has been transmitted 
to this Committee and to the Appropriations subcommittees has 
been posted on the website, and we will continue to do that 
sort of thing.
    I want to thank the Subcommittee for giving me the 
opportunity to testify, and look forward to answering 
questions.
    Thank you.
    [The prepared statement of Mr. McDonald follows:]

        Statement of J. William McDonald, Acting Commissioner, 
         Bureau of Reclamation, U.S. Department of the Interior

    Madam Chairwoman and members of the subcommittee, I am Bill 
McDonald, Acting Commissioner of the Bureau of Reclamation. I 
appreciate the opportunity to report on the selection of projects by 
the Department of the Interior to be funded with the $1 billion 
appropriated to Reclamation by the American Recovery and Reinvestment 
Act of 2009 (P.L. 111-5).
    To begin, I know that the subcommittee has specific questions on 
the readiness of Recovery Act projects, the criteria used to select 
them, how we'll maximize effectiveness, and what the effect of this 
appropriation will be on Reclamation's 2010 budget. We look forward to 
this opportunity to address these issues during this hearing and 
through the statements below.
Reclamation's Investments in the Future
    The Department and Reclamation are moving expeditiously with our 
customers to invest funds appropriated by the Recovery Act in projects 
which will quickly provide jobs and stimulate the economy. As Secretary 
Salazar announced on April 15, $945 million is being devoted to 
Reclamation recovery projects in six program investments areas, 
summarized here and with individual projects detailed in the attached 
one page table:

[GRAPHIC] [TIFF OMITTED] T9371.002

    .epsAs permitted by the Recovery Act, $50 million is being 
transferred to the Department's Central Utah Project Completion Act for 
work that includes continuing construction of both the Spanish Fork 
Canyon Pipeline and the Spanish Fork--Provo Reservoir Canal Pipeline, 
as well as the construction of the Big Springs Fish Hatchery for the 
Ute Indian Tribe. Finally, as permitted by the statute, $5 million is 
being set aside for management and oversight.
    From the $450.9 million for projects which will meet future water 
supply needs, $200 million will go to six rural water projects in the 
Dakotas and Montana, and $135 million will be devoted to water 
reclamation and reuse projects authorized by Title XVI of Public Law 
102-575, as amended. Title XVI projects are currently being evaluated 
and prioritized based upon criteria which were publicly announced in 
March, with the selection of individual projects to be announced in the 
coming months. With these sums, we can make substantial progress on 
these projects and accelerate the delivery of project benefits to 
Native Americans, rural communities, and metropolitan areas.
    Also of interest to this Subcommittee, Reclamation projects in many 
western states will receive Recovery Act dollars for infrastructure 
reliability and safety improvements. Reclamation is allocating $164.5 
million for infrastructure, reliability and safety improvements, 
including accelerating construction work on the Folsom Dam in 
California and performing flatiron penstock recoating to the Colorado 
Big Thompson Project. Environmental/ecosystem restoration is another 
area that Reclamation is dedicating a significant amount of its ARRA 
funding. Oregon projects will benefit with more than $4 million in 
funds for environmental restoration and infrastructure reliability. 
Projects in Colorado will receive more than $20 million for 
infrastructure reliability, as well as $12.1 million at the Animas-La 
Plata facility straddling the border with New Mexico; projects in 
Arizona more than $66 million for infrastructure reliability, future 
water supplies and environmental restoration; projects in Washington 
more than $120 million for infrastructure reliability, future water 
supplies and environmental restoration; and projects in California more 
than $260 million for ecosystem restoration and infrastructure 
reliability. Additionally, Reclamation is yet to announce $135 million 
worth of specific water recycling projects funds, many of which are 
authorized for funds in California. Finally, $266 million is for 
various projects widely distributed across the western states.
    Just as the final selection of individual Title XVI projects has 
yet to be made, this is also the case with the financial assistance 
that will be provided to non-federal parties for projects under the 
Water Conservation Initiative/Challenge Grants ($40 million), for Title 
II Colorado River Basin Salinity Control Projects ($10 million), and 
for Lower Colorado River Multi-Species Conservation Implementation 
projects ($2.5 million). All three of these are competitive grant 
programs for which the selection criteria and project solicitations 
have already been publicly announced on www.grants.gov. All three have 
closing dates in May, after which final projects will be selected.
    Likewise, the final selection of emergency drought relief projects 
to be undertaken pursuant to the Drought Relief Act of 1991 and other 
authorities has yet to be made. This is because we are in the process 
of gathering information from those suffering from 2009 drought 
conditions regarding the assistance they need. We are moving as rapidly 
as possible on this front and expect to reach decisions and begin some 
projects within the coming months.
Project Selection Process
    Consistent with the ARRA guidelines, funding was allocated to 
programs, projects, or activities that will complete either a project 
phase, a project, or will provide a useful service that does not 
require additional funding. The Recovery Act does not provide funding 
for any new projects not previously authorized by Congress. 
Accordingly, all selected projects are ones which would be undertaken 
by Reclamation in the normal course of business. They were identified 
from Reclamation's standard program formulation process, out year 
budget projections, and long-term investment plans.
    In this context, Reclamation reviewed approximately $2 billion 
worth of potential projects. In the spirit of the Recovery Act, 
Reclamation and the Department used a multi-tiered, merit-based 
evaluation process that considered:
    1.  ARRA general objectives (e.g., creating jobs and investing in 
infrastructure) and Department of the Interior policy objectives (e.g., 
improving energy efficiency and assisting Native Americans),
    2.  Priorities specific to Reclamation as required by the Recovery 
Act and its Conference Report and as established by the Department,
    3.  Reclamation's overall program priorities, and
    4.  Criteria for selection of projects within individual program 
investment areas.
    The Recovery Act requires, in section 1603, that all funds 
appropriated by the act be obligated by the end of Fiscal Year 2010. 
The Department further placed priority on those projects which could 
maximize expenditures by then, not just be obligated. Accordingly, we 
expect that nearly all projects which we have selected will be well 
along by the end of Fiscal Year 2010 and completed by the end of Fiscal 
Year 2011, although a few will not be completed until Fiscal Year 2012.
    In addition, the Act and its Conference Report established a number 
of requirements unique to Reclamation. First, certain minimum funding 
levels were established for rural water projects ($60 million), Title 
XVI projects ($126 million), and inspections of canals in urban areas 
($10 million). Second, the Conference Report indicated, but did not 
require, that priority be given to projects which have little schedule 
risk, will be executed by contract or the hiring of temporary labor, 
and will complete either a project or a phase of a project and will 
provide a useful service that does not require additional funding. Some 
have referred to these projects as ``shovel ready.'' Finally, with 
regard to rural water projects, priority was to be given to the water 
intake and water treatment features of these projects.
    With regard to Reclamation's overall program priorities, we gave 
priority to Recovery Act activities which, through the acceleration of 
construction already underway, would achieve more efficient 
construction schedules, probable cost reductions, and an earlier 
realization of project benefits. In addition, we are funding a 
relatively small number of large construction projects, with the use of 
stimulus funding balanced across program investment areas to maximize 
the benefit from this appropriation. For this reason, project timelines 
and the transmittal of funds will vary depending on the state of a 
project at the time when Recovery Act funds are provided.
    Within certain programs, Reclamation used evaluation criteria 
specific to those individual programs, such as dam safety projects, 
Title XVI water reclamation and reuse projects, water conservation 
grants, and infrastructure repairs and replacements. These have been 
documented in the Department's April 14, 2009, letters to the Senate 
and House Appropriations Committees.
    Obviously many of the projects receiving funding under the Recovery 
Act may be included in the President's 2010 request. However, we do not 
have information at this point to characterize the Recovery Act's 
affect on funding amounts that will be requested for 2010.
Reporting on Our Progress
    The Department will work to assure that the Recovery Act's goals of 
job creation and mission advancement will have maximum transparency to 
Congress and the public. At all levels of the organization we clearly 
understand that the Recovery Act represents a once-in-a-lifetime 
opportunity to concurrently advance Reclamation's mission and the 
country's economic future. We are committed to the success of this 
effort and to being accountable for the expenditure of the stimulus 
monies which have been entrusted to us.
    As required by the law, we began reporting on our progress in 
implementing the Recovery Act with the first posting on March 3 to the 
Recovery.gov website. On March 19, the Department submitted a general 
plan for the expenditure of Recovery Act funds which met the 
requirement in Title IV of the Recovery Act to submit a quarterly 
report beginning no later than 45 days after enactment. The 
aforementioned April 14 letter to the Appropriations Committees then 
provided a list of the projects which had been selected for funding 
with the $1 billion appropriated to Reclamation by the Recovery Act. We 
will, of course, continue to provide all required reports.
    The Department has also established its own specific web page at 
www.doi.gov/recovery, which links to Recovery.gov and displays more in-
depth information on Recovery Act projects undertaken by Reclamation. 
This site will be kept up-to-date as we progress so that our Recovery 
Act projects and activities, and the expenditure of funds, is fully 
transparent.
Conclusion
    In conclusion, I want to thank the Subcommittee for giving me the 
opportunity to testify on what Reclamation has done to move forward in 
creating jobs and implementing the Recovery Act. I would be pleased to 
respond to your questions.
                                 ______
                                 

 Response to questions submitted for the record by J. William McDonald

Questions submitted by Chairwoman Grace Napolitano
 Question 1: The outstanding question that your testimony did not 
        answer is how many jobs will the Reclamation ARRA funds 
        create'!
    Answer: We expect to receive additional information on job creation 
in the months ahead as American Recovery and Reinvestment Act (ARRA) 
monies are disbursed and contracts are awarded to non-federal entities. 
At this time, it is difficult to determine exactly how many jobs ARRA 
funds will create because much of these funds will go to contractors 
who will hire employees to perform the work. As you know, the Council 
of Economic Advisers has provided guidance that one full time 
equivalent job year is created or saved by spending $92,136. Using this 
figure, Reclamation's $950 million funding would be equivalent to 
approximately 10,300 jobs. We are still developing means of tracking 
actual jobs created to compare to this estimate.

 Question 2: What is your definition of shovel-ready'!
    Answer: A project or activity must be previously authorized to be 
constructed by Reclamation or otherwise funded by Reclamation with ARRA 
monies. Further, the design and engineering, and environmental 
compliance had to be well along, if not complete, and other 
construction prerequisites had to be well in hand in order to receive 
Recovery Act funds. The projects selected had to be executed quickly, 
have little schedule risk, and be executed by contract or direct hire 
of temporary labor and result in high, immediate employment.

 Question 3: Currently, California and parts of Texas are experiencing 
        drought conditions and water emergency supply losses. Why are 
        there no emergency drought relief projects in the project list 
        Reclamation submitted'! When do you expect these projects to be 
        determined'!
    Answer: Reclamation announced that it will allocate up to $40 
million in Recovery Act funds to projects that will address the impacts 
of drought in the west with a focus on California. We are currently in 
the process of evaluating proposed drought relief projects for funding, 
and expect to finalize our selections in the coming weeks. Through our 
review process, Reclamation will ensure that ARRA funding will be used 
for emergency drought relief projects that can quickly and effectively 
mitigate the consequences of the current drought.
    Apart from our steps to allocate ARRA funding to drought relief 
projects, Reclamation has taken other significant steps to address 
drought conditions. Other actions include Reclamation's prompt 
completion of appropriate environmental analysis needed to facilitate 
water transfers through California's Drought Water Bank. The water bank 
will make additional supplies of water available now and in the future 
by enabling the state to purchase water from willing sellers upstream 
of the Sacramento-San Joaquin Delta, and to approve the transfer of the 
water to willing buyers using State Water Project facilities or Central 
Valley Project facilities.
    Reclamation has also obligated funding for water use efficiency 
projects in California though multiple grant programs to accelerate the 
implementation of water conservation activities. These activities 
included rebate programs, irrigation system upgrades, technology 
transfer to improve and advance Best Management Practices, and water 
conservation educational programs. Grants were funded through the Water 
Conservation Field Services Program, the Challenge Grant Program, and 
the CALFED Water Use Efficiency Grant Program. Finally, the State of 
Texas has not yet made a drought declaration and request to the 
Secretary of the Interior. Therefore, under the terms of Section 104 of 
the Reclamation States Emergency Drought Act (PL 102-250), Texas is not 
currently eligible for Drought Act funding.

 Question 4: The Title XVI project selection criteria states that 
        projects will not receive construction money unless they have a 
        finding from the Bureau that their feasibility study meets the 
        requirements of Title XVI of PL 102-575. How many projects have 
        these findings from the Bureau? What do projects need to do to 
        receive determination of feasibility?
    Answer: There are now 53 individually authorized Title XVI 
projects. Amendments made in 1996 to Title XVI of P.L. 102-575 
established a requirement that a project must include a completed 
feasibility study prior to construction funding. In addition to 
projects authorized in 1992 and other demonstration projects that do 
not require feasibility studies, twenty-eight projects have received a 
finding from Reclamation that the project's feasibility study meets the 
requirements of Title XVI. It is important to note that an activity 
proposed for Recovery Act funding might be merely one component of a 
larger authorized Title XVI project and that project's approved 
feasibility study.
    To receive a determination of feasibility, project sponsors need to 
submit a copy of a feasibility study to Reclamation for review. The 
study must include introductory information such as a description of 
the study area, a statement of problems and needs, water reclamation 
and reuse opportunities, description of alternatives, economic 
analysis, justification of the selected alternative, environmental 
consideration and potential effects, legal and institutional 
requirements, financial capability of the sponsor, and research needs 
if applicable.
    Reclamation has committed to timeframes for its review of the 
feasibility study report once submitted. For example, Reclamation will 
initiate review of the study report within 15 days, will establish a 
review team within 15 days of initiating review, and will notify the 
project sponsor within 90 days if additional information is necessary.
    Detailed description of required elements of a Title XVI 
feasibility study, along with a description of the review process and 
timeframes, are publicly available at http://www. usbr.gov/recman/wtr/
wtr11-0l.pdf.
    The Bureau of Reclamation also recently announced its ARRA funding 
for water reclamation and recycling projects. Using funds appropriated 
by the American Recovery and Reinvestment Act of2009, Reclamation 
allocated approximately $132 million for 26 water reuse and recycling 
projects in California.

 Question 5: A few people have raised the ``Buy American'' provision 
        for ARRA funds for Reclamation. How will the waiver process be 
        handled for water infrastructure needs?
    Answer: When it is determined by the Project Manager that a waiver 
will be required due to meeting any of the three conditions identified 
in Section 1605 of ARRA, a request for waiver will be made through 
Reclamation's Procurement Chief to the Department of the Interior's 
Director, Office of Acquisition and Property Management for approval.

 Question 6: Some have complained about the focus on large projects and 
        the bulk of funding going to only a few places. How would you 
        counter their criticism?
    Answer: Reclamation used a multi-tiered, merit-based evaluation 
process which considered: 1) The general objectives of the ARRA (e.g. 
preserve and create jobs, and invest in infrastructure) and 
Departmental policy objectives (e.g., improving energy efficiency and 
assisting Native Americans); 2) Priorities specific to Reclamation as 
required by the ARRA and its Conference Report, and as established by 
the Department; 3) Reclamation's overall program priorities; and 4) 
Criteria for selection of projects within the six program investment 
areas.
    In addition to the minimums set by the ARRA for canal inspections, 
Title XVI and rural water projects, Reclamation applied the following 
general criteria and considerations to its evaluation of all potential 
projects and programs: 1) priority was given to stimulus activities 
which, through the acceleration of construction already underway, would 
achieve more efficient construction schedules, probable cost 
reductions, and an earlier realization of project benefits than would 
otherwise be the case; 2) priority was given to funding large 
construction work that is difficult to accommodate within annual budget 
limitations; 3) the use of stimulus funding was balanced across 
programs and activities to ensure the continued delivery of public 
benefits, the operation and maintenance of facilities in a safe and 
reliable manner, the protection of the health and safety of the public 
and Reclamation employees, and compliance with environmental 
requirements and opportunities for ecosystem restoration; and 4) 
priority was given to larger projects to the extent possible in light 
of the workload limitation on the staff available to process 
procurements and financial assistance agreements. Further, I would 
suggest that through the abovementioned selection process, projects 
were selected in more than 12 of the 17 Western States. Additionally, 
several of the competitive grant programs, such as the challenge 
grants, have not yet selected projects to be carried out using ARRA 
funding so that distribution could rise as projects are selected across 
the west.

 Question 7: Many of these projects have been authorized for the past 
        decade. How did climate change and changing demand playa role 
        in determining which water projects would receive ARRA funding? 
        Will ARRA funds be used to establish a Reclamation Climate 
        Change and Water Program, as authorized in P.L. Ill-II?
    Answer: ARRA projects were selected from among existing and ongoing 
Reclamation projects without specifically addressing climate change. 
However, climate change and changing demand factor into decisions by 
Reclamation projects managers and agency partners. ARRA projects were 
considered and selected in accordance with the process explained in 
Question 6 above. Passage of P.L. 111-11 came after development of 
Reclamation's ARRA project list and after enactment of the ARRA itself, 
and therefore, new Reclamation Climate Change and Water Program 
authority did not playa role in the selection process.

 Question 8: Can you please elaborate on the change you have made to 
        the funding of the Water Conservation Initiative Program-where 
        the minimum amount funded was increased from $300,000 to $1 
        million?
    Answer: The purpose of having a larger minimum requirement, and a 
higher maximum, on project size is to accommodate large projects that 
cannot be handled within the limited annual funding that has typically 
been available. Reclamation is aware of several ``shovel ready'' water 
conservation projects that can avail themselves of this one-time 
opportunity. Reclamation anticipates that with the ongoing program 
funding, there will be plenty of funding for more than the usual number 
of smaller projects. Thus, it was deemed prudent to devote stimulus 
funding to larger projects.

 Question 9: Can you please elaborate on the criteria for the high-risk 
        assessment code (RAC). Do you have, or would it be possible to 
        develop a similar assessment process for water supply 
        reliability do to environmental compliance? (For example, some 
        projects are more susceptible than others to supply disruptions 
        due to endangered species or other environmental constraints.) 
        Could such an assessment process help managers and water users 
        allocate funding more efficiently?
    Answer: The criteria for the RAC code are summarized in the table 
below:

[GRAPHIC] [TIFF OMITTED] T9371.003

    In developing a similar risk assessment process for water 
supply reliability due to environmental compliance concerns, the 
critical risk factor would be the imposition of shortages to water 
users in order to comply with a biological opinion. Some consequence 
levels would need to be developed. For instance, no delivery shortage 
imposed on water users; 25% shortage; 50% shortage; 100% shortage. The 
probability of each consequence level would have to be developed, based 
on short-or long-term hydrology and the relevant biological opinion. 
One would have to compare a ``without mitigation'' scenario (e.g., not 
constructing a fish bypass facility) to a ``with mitigation'' scenario 
(constructing the facility) and assess the difference in consequences. 
For example, if constructing the facility would move the long-range 
consequences from a 50% shortage based on some hydrology scenario, to a 
25% shortage based on the same hydrology, then the difference could be 
quantified and compared against the cost of constructing the mitigation 
facility. Most likely, this model would have to be developed basin by 
basin since the environmental, hydrological and beneficial use 
conditions would vary considerably.

Questions submitted by Representative Joe Baca
 Question 1: Why is there a delay in the final selection of emergency 
        drought relief projects?
    Answer: Reclamation recently announced that it will allocate up to 
$40 million in funding available under the ARRA to projects that will 
address the impacts of drought in the west with a focus on California. 
We have received many requests for funding from a diversegroup 
ofstakeholders. Wearecurrentlyintheprocess ofevaluatingproposed drought 
relief projects for funding, and expect to finalize our selections in 
the coming weeks. Through our review process, Reclamation will ensure 
that ARRA funding will be used for emergency drought relief projects 
that can quickly and effectively mitigate the consequences of the 
current drought.
    Apart from our steps to allocate ARRA funding to drought relief 
projects, Reclamation has taken other significant steps to address 
drought conditions. Other actions include Reclamation's prompt 
completion of appropriate environmental analysis needed to facilitate 
the transfer of water through California's Drought Water Bank. The 
water bank will make additional supplies of water available now and in 
the future by enabling the state to purchase water from willing sellers 
upstream ofthe Sacramento-San Joaquin Delta, and to approve the 
transfer of the water to willing buyers using State Water Project 
facilities or Central Valley Project facilities. Reclamation has also 
obligated funding for water use efficiency projects in California 
though multiple grant programs to accelerate the implementation of 
water conservation activities. These activities included rebate 
programs, irrigation system upgrades, technology transfer to improve 
and advance Best Management Practices, and water conservation 
educational programs. Grants were funded through the Water Conservation 
Field Services Program, the Challenge Grant Program, and the CALFED 
Water Use Efficiency Grant Program.

 Question 2: In regard to the green buildings funding. The written 
        testimony on the $13.5 million is omitted. Can you explain how 
        the funding will be distributed? What are your priorities for 
        the green buildings funding'! Will this funding comply with 
        Davis-Bacon requirements?
    Answer: Reclamation has identified one building-Boulder Canyon 
Operations Office-that met Reclamation's Green Building selection 
criteria to: 1) reduce water and energy use; 2) lessen Reclamation's 
carbon footprint; and 3) save Federal funds in the long run due to 
lower electricity, water and maintenance costs. This funding will 
comply with the Davis-Bacon requirements.

 Question 3: In your written statement, you shared that $5 million will 
        be set aside for management and oversight? Can you explain how 
        the funding will be used and prioritized? And will that funding 
        be used for all recovery investments.
    Answer: Section 403 of ARRA provides ``up to 0.5 percent of each 
amount appropriated in this title may be used for the expenses of 
management and oversight of the programs, grants, and activities funded 
by such appropriation, and may be transferred by the head of the 
Federal department or agency involved to any other appropriate account 
within the department or agency for that purpose.'' In the case 
ofReclamation, this amounts to $5 million. ARRA also authorized the 
transfer of up to $50 million to the Central Utah Project Completion 
Act (CUPCA). Therefore, CUPCA received $250,000 as their share of 0.5 
percent for management and oversight which leaves Reclamation with 
$4.75 million for management and oversight which will be prioritized 
and allocated to Reclamation offices based on justification that it 
will be for the purpose of paying for salaries of employees who are 
detailed and/or specifically hired for the purpose of managing and 
overseeing all ARRA related activities.

 Question 4: When do you hope to announce the selection of individual 
        projects for Title 16 projects?
    Answer: Title XVI projects have been rated and ranked within 
Reclamation's $135 million allocation for that program. The official 
announcement was recently made. Reclamation allocated approximately 
$132 million to 26 water recycling and reuse projects in California. In 
addition, a Title XVI project in Albuquerque, New Mexico, was also 
selected for funding.

 Question 5: Of the $164.5 million set aside for infrastructure 
        reliability and safety improvements exactly how much will be 
        allocated to the Folsom Dam in California and to the Colorado 
        Big Thompson Project?
    Answer: Funds in the amount of$30,620,000 have been identified for 
Folsom Dam in California, $22,300,000 for safety ofdams activities, and 
$8,320,000 for RAX activities (replacement, additions, and 
extraordinary requirements.) Funds in the amount of $19,650,000 have 
been identified for the Colorado Big Thompson Project for about seven 
RAX items.

 Question 6: When will you announce the $135 million worth of specific 
        water recycling projects? Why is there a delay?
    Answer: Title XVI projects have been rated and ranked within 
Reclamation's $135 million allocation for that program investment. 
Reclamation's rating and ranking process necessitated an information-
gathering step from project sponsors which increased the time needed to 
complete the process. Reclamation recently announced the projects it 
had selected for funding with ARRA dollars.

 Question 7: Of the $266 million that will be used for various projects 
        widely distributed across the western states, can you provide 
        examples of projects that you are considering? When will you 
        make a decision?
    Answer: The $266 million figure represents a mixture of project 
funds from the six different ARRA funding categories announced April 
15. It was used simply as a point of reference in Reclamation's April 
28, 2009 subcommittee testimony, since the testimony provided a summary 
of ARRA funds of interest to the subcommittee members' home states of 
Arizona, California, Colorado, Nebraska, Oregon and Washington. The 
$266 million figure is not significant as a standalone funding 
category. Most of the projects included in the $266 million have been 
approved for funding and procurement activity is underway. Examples 
include the rural water projects in Montana, North Dakota, and South 
Dakota ($200 million); Colorado Basin Salinity Control Projects meant 
to provide system-wide, regional benefits ($10 million); and various 
other ecosystem ($7.8 million) or infrastructure improvements ($11.9 
million) both within and outside the aforementioned states. Water 
Conservation Initiative grants for which projects may compete for funds 
west-wide ($40 million) will be announced in the coming weeks. To 
correct our previous figure, this grouping actually totals to $269.7 
million, not $266 million as stated in the testimony.
                                 ______
                                 
    Mrs. Napolitano. Thank you, Commissioner. And I did give 
you additional time, because hopefully some of what you have 
said might answer some questions. If not, I am sure there are 
going to be plenty of questions for you.
    I would like to call on Mr. Costa, who arrived a little 
bit, for an opening statement. I believe he does have one.
    Mr. Costa.

   STATEMENT OF THE HONORABLE JIM COSTA, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Costa. Thank you very much, Madame Chairwoman, for 
hosting this important hearing on the economic stimulus and its 
impact on water conditions as it affects our entire country and 
the potential for the stimulus package to try to assist in 
those areas that are in deep crisis.
    Your efforts today and your efforts in the previous hearing 
on the drought are appreciated, as well as the Ranking 
Member's. Thank you both--and your staff.
    Members of the Subcommittee, I want to underline the 
efforts that have taken place. Of course, Secretary Salazar was 
in Sacramento about 10 days ago; announced the potential 
economic stimulus package in California. And we appreciate the 
efforts very much.
    But I was disappointed in the list. I was disappointed 
because I think that the current water shortage that has a 
devastating effect for farmers and farm workers and communities 
throughout the San Joaquin Valley ended up, in terms of 
balance, not getting a fair share in my view. And let me tell 
you why.
    More than 300 crops are grown in the Valley, some of which 
are not grown anywhere else in the world. The Valley's 
agriculture is a $20 billion-a-year industry that accounts for 
nearly 40 percent of the Valley's employment.
    Three consecutive years of either manmade or Mother 
Nature's, I guess, impact on dry water conditions and manmade 
water shortages--i.e., the regulatory scheme--have had a 
crippling effect on communities throughout the San Joaquin 
Valley.
    We think over 800,000 acres of farmland will be fallowed 
this year. Experts indicate that maybe 30,000 to 40,000 jobs 
may be lost. In the San Joaquin Valley. We aalready have a 
crippling of water deliveries that has led to 41 percent 
unemployment in the City of Firebaugh. I represent 8,000 farm 
workers and farmers.
    The City of Mendota has 38 percent unemployment. And 
Delano, now over 50,000 population, four high schools, the home 
of Cesar Chavez, has 34 percent unemployment.
    When you have those numbers where a third are close to 40 
percent of your community has no jobs, it is no longer a 
recession, it is a depression. So the economic devastation, 
coupled on top of the housing crisis, coupled on top of the 
dairy meltdown, has made this absolutely horrific for the 
people who live there.
    My question, and when it gets to the witnesses, and Mr. 
McDonald, and Mr. Atwater as it relates to the application of 
funds--and I realize when I voted for this in February, it was 
for the purpose of economic stimulus. But we are very clever. 
We can do more than one thing at a time. We can use economic 
stimulus also that will solve problems that have been festering 
for a while.
    And so my question is not on the outline of the $260 
million that the Secretary indicated, because all of those 
projects I think have merit. The Red Bluff Diversion Area, I 
mean, all of these things I would support.
    But when you are in a crisis, when you have a situation as 
we find ourselves in, and have only $40 million of the $1 
billion in stimulus funds set aside for emergency drought 
relief, I think that is, the balance is sadly lacking. Four 
percent of the local funds are devoid to Reclamation, the 
Bureau's efforts on recovery projects in total for drought-
related efforts.
    And so the Two Gates, that was supported by Congressman 
Radanovich and myself and others in the Valley, including 
Congressman Miller, was put on the list. This transfer works 
that Mr. McDonald commented on, I have real problems with what 
fell under the definition or what didn't.
    So Madame Chairwoman, I want to thank you and the Ranking 
Member for allowing me to make comments that I think are 
critical. And I know it is local, I am focusing local here, but 
that is where my crisis is.
    And as we examine the entirety of the stimulus package and 
its merits--and I voted for it, like you did, and I support the 
projects, generally--my point is that we have a crisis here. 
And I think there needs to be balance.
    Thank you very much, Madame Chairwoman.
    Mrs. Napolitano. Thank you, Mr. Costa. Mr. Baca.
    Mr. Baca. Thank you very much, Madame Chair.
    Mrs. Napolitano. By the way, I do agree with you, Mr. 
Costa. There is an emergency. Thank you.

   STATEMENT OF THE HONORABLE JOE BACA, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Baca. Thank you. First of all, I want to thank you for 
the burrito.
    [Laughter.]
    Mr. Baca. But, Madame Chair, I really want to thank you for 
having this important hearing. It is well known that the prices 
in water not only in the State of California, but throughout 
our nation, I know that I have several questions. And I know 
that one of my staffers worked for Secretary Salazar as well, 
and he seems to be proactive on water crises and the issue's 
impact in California.
    And he recently toured our area. And I know that, Madame 
Chair, you happened to visit him in San Francisco. We 
appreciate the fact that you have always taken the leadership, 
and have always been one of the strongest advocates for water.
    Like me, I am very much concerned with the amount of 
dollars that we are getting, and we actually should be looking 
at further dollars as we look at the drought, not only in 
southern California, but northern California, and maybe explore 
other avenues.
    I know that I spoke to the Secretary of Ag, and he came up 
with an idea of the possibility that maybe we can look at, in 
terms of the future, when we look at water, is water coming 
from South Dakota areas and having it come down, and channel 
like we do, you know, the Alaska Pipeline. There are some 
avenues that we have to explore, which means that we may need 
additional dollars. So this way we are not always competing 
with northern California from southern California on water, but 
then the water would also be available not only for us, but for 
those individuals in Nevada.
    These are some of the things that we have to start looking 
at and exploring other ways. Because this would not only 
stimulate South Dakota and that area in terms of jobs that 
could be created there, but they have plenty of water that 
maybe they will channel into us. That is something that we have 
to explore, as well.
    And with that, Madame Chair, I thank you. I look forward to 
asking several questions of our speakers here today.
    Mrs. Napolitano. Thank you, Mr. Baca.
    Next I have Mr. Matthew Larsen, Associate Director for 
Water, United States Geological Survey in Reston. Sir, welcome.

 STATEMENT OF MATTHEW C. LARSEN, Ph.D., ASSOCIATE DIRECTOR FOR 
    WATER, UNITED STATES GEOLOGICAL SURVEY, RESTON, VIRGINIA

    Mr. Larsen. Madame Chairwomen and members of the 
Subcommittee, I appreciate this opportunity to provide the 
Department of Interior's views to provide USGS efforts to 
implement the American Recovery and Reinvestment Act of 2009.
    The Act provides $140 million to the USGS that will fund 
projects across all 50 states, Guam, and Puerto Rico. We 
welcome this opportunity to create and support jobs, and also 
to support the scientific research that underpins the 
Department's decisions on behalf of the American people, as the 
stewards of the nation's natural resources.
    The Recovery Act provides an unprecedented opportunity to 
address funding needs that could not be met with current 
appropriations. The funding received through the Act will allow 
the USGS to address streamgage modernization, deferred 
maintenance projects at the USGS facilities, and abandon 
groundwater wells that have not been remediated, as well as 
streamgages and cableways that have been discontinued and 
should be removed.
    Finally, it also includes funds for upgrades to modern 
capabilities for earthquakes and volcanoes and a collection of 
much-needed elevation data especially in coastal and riparian 
areas.
    My remarks today focus on the water-related project areas 
which are of most interest to the Subcommittee. Of the total, 
they are an investment for the USGS water program; $14.6 
million will be used to upgrade the National Streamgage 
Network, and an additional $14.6 million will be distributed to 
deferred water maintenance projects. These funds will be 
expended in all 50 states.
    USGS National Streamgage Network consists of 7,500 sites 
that provide critical information used to estimate flood 
dangers, protect fragile ecosystems, construct safe bridges and 
roadways, and monitor the effects of climate change on water 
availability. This network depends on the NOAA GOES satellite 
for transmission of real-time streamflow data.
    In order for the USGS to continue to use the GOES 
satellite, USGS must convert its streamgages to a new high-
data-rate radio technology by the end of 2013. Approximately 
4,500 streamgages across the Nation have already been upgraded 
to this new technology, using annual appropriations.
    Funding through the ARRA, combined with annual 
appropriations, should enable the USGS to complete the 
conversion well before the 2013 deadline.
    USGS will also use $14.6 million, or part of the $14.6 
million from the Recovery Act to upgrade streamgages with new 
streamflow measuring technologies that are safer to use than 
older technologies, and reduce operation and maintenance costs. 
The new streamflow measurement equipment will allow the USGS to 
monitor their streamflow more efficiently, and provide higher-
quality data.
    In keeping with the Administration's focus on renewable 
energy, solar-powered technologies will be used to the greatest 
extent possible.
    The other $14.6 million will be used for deferred 
maintenance at a range of sites. USGS operates many streamgages 
and groundwater wells in cooperation with state and local 
funding partners. When partners no longer fund the streamgages 
and wells, sites are usually closed and removed or remediated.
    However, in some cases, funding for remediation has not 
been available. The $14.6 million received through the Recovery 
Act will be spent on equipment and services that will remove or 
remediate structures that are no longer in use, thereby 
restoring the sites and making them safe for public enjoyment.
    Approximately 1200 discontinued mining sites nationwide 
will be remediated. Once this work is completed, there will be 
no future operating costs associated with these sites.
    In order to meet the President's call for transparency and 
accountability for money spent as part of the ARRA, and to 
fulfill citizens' desires to track where their taxpayer dollars 
are going and how they are being spent, the USGS has 
established a Recovery Oversight Board. The Board will ensure 
that USGS projects are executed according to the requirements 
of the Act; in other words, plans are meeting the objectives, 
spending rates are aligned, and work is on schedule.
    The USGS welcomes this opportunity to provide the science 
needed to meet the imperatives of the nation's challenges, 
particularly in the water resources arena. And we thank you for 
the opportunity to testify. And I will be pleased to answer any 
questions the Subcommittee may have.
    Thank you.
    [The prepared statement of Mr. Larsen follows:]

     Statement of Matthew C. Larsen, Associate Director for Water, 
        U.S. Geological Survey, U.S. Department of the Interior

    Madam Chairwoman and members of the Subcommittee, I appreciate the 
opportunity to provide the Department of the Interior's views regarding 
USGS efforts to implement the American Recovery and Reinvestment Act of 
2009 (PL 111-05).
USGS Role in Economic Stimulus Program
    The American Recovery and Reinvestment (ARRA) Act of 2009 (P.L. 
111-5) provided $140 million to the U.S. Geological Survey that will 
fund 308 projects across all 50 states, Guam, and Puerto Rico. We 
welcome this opportunity not only to create and support jobs, but also 
to support the scientific research that underpins the Department's 
decisions on behalf of the American people as the stewards of the 
Nation's natural resources.
    The funding received through ARRA will allow the USGS to address an 
inventory of deferred maintenance projects at USGS facilities; 
abandoned groundwater wells that have not been remediated; streamgages 
and cableways that have been discontinued and should be removed; 
upgrades to monitoring capabilities for earthquakes and volcanoes; 
streamgage modernization; and collection of much-needed elevation data, 
especially in coastal areas. A number of criteria were considered in 
order for a project to be deemed suitable for funding through ARRA. 
Among these criteria were (1) expediency of implementation; (2) 
addresses high priority mission needs; (3) job creation potential, and 
(4) long-term value.
    Funding received under the Recovery Act will not significantly 
affect USGS's FY 2010 budget request. Recovery Act appropriations will 
be applied to projects meeting the criteria of the Act, as outlined 
above. The FY 2010 budget request will address needs of the entire USGS 
portfolio, most of which go beyond the criteria of the Recovery Act.
    I will briefly summarize some of the planned projects and then will 
focus most of my statement on the two water-related project areas, 
which are of most interest to this Subcommittee.
    Specific investments include:
      Volcano Monitoring--$15.2 million to modernize equipment 
in the National Volcano Early Warning System at all USGS volcano 
observatories. The U.S. and its territories include some of the most 
volcanically active regions in the world, with 169 active volcanoes. As 
many as 54 of these potentially dangerous volcanoes need improved 
monitoring.
      Deferred Maintenance of Facilities--$29.4 million for 
projects that address health and safety issues; meet functional needs 
such as improved laboratory space; make facilities more energy 
efficient; and incorporate sustainable design criteria in project 
implementation. There are 67 projects in 18 States and territories that 
will receive funding for deferred facilities maintenance, including 
Alaska, California, Guam, Louisiana, Maryland, Massachusetts, Michigan, 
Missouri, New York, Pennsylvania, South Dakota, Washington, Wisconsin, 
and West Virginia.
      Earthquake Monitoring--$29.4 million to enhance the 
Advanced National Seismic System (ANSS) by doubling the number of ANSS-
quality stations and upgrading seismic networks nationwide, to bring 
the total from approximately 800 to 1600. These improved networks will 
deliver faster, more reliable and more accurate information--helping to 
save lives by providing better situational awareness in the wake of the 
damaging earthquakes that can strike this Nation at any time.
      Construction--A total of $17.8 million for research 
facilities at Patuxent Wildlife Refuge Research Center in Patuxent, MD; 
the Columbia Environmental Research Center (CERC) in Columbia, MO; and 
the Upper Midwest Environmental Services Center (UMESC) in LaCrosse, 
WI. Work at these centers will improve the ability of scientists to 
conduct innovative research on contaminants and wildlife, endangered 
species, wind power and wildlife, adaptive management, wildlife disease 
and much more. The rehabilitation of these facilities will support jobs 
for the local community, improve functionality, and reduce long-term 
operating costs.
      Imagery and Elevation Maps--$14.6 million to improve 
mapping data, which will be made publicly available for multiple uses 
including flood mapping, emergency operations, and natural resource 
management.
      Data Preservation--$0.5 million for the USGS Bird Banding 
Laboratory (BBL) to digitize, and make available to the public via the 
Internet, the historical banding recovery and bird banding records. 
Bird banding data have a wide variety of uses including applications 
for disease research.

Water Investments
    Of the total ARRA investment for the USGS water program, $14.6 
million will be distributed to deferred maintenance projects and $14.6 
million to upgrade the national streamgage network; these funds will be 
expended in all 50 States.
    Deferred Maintenance--Streamgages, Cableways, and Wells: The USGS 
operates streamgages and groundwater wells with state and local funding 
partners; when partners no longer co-fund the streamgages and wells, 
sites are usually closed and removed or remediated. Discontinued 
streamgages, cableways, and wells may pose public health and safety 
issues until they are removed or remediated. The $14.6 million will be 
spent on equipment and services that will remove or remediate 
structures that are no longer in use, thereby restoring the site and 
making it safe for public enjoyment. Approximately 1,200 discontinued 
monitoring sites nationwide will be remediated. Once this work is 
completed, there will be no future operating costs associated with 
these sites. This work will reduce the USGS liability for discontinued 
monitoring sites by at least $15.0 million.
    Upgrades to Streamgages: The USGS national streamgage network 
(7,500 sites) provides critical information used to estimate flood 
dangers, protect fragile ecosystems, construct safe bridges and 
roadways, and monitor the effects of climate change on water 
availability. This network depends on the NOAA-operated Geostationary 
Operational Environmental Satellites (GOES) for transmission of real-
time streamflow data. In order for the USGS to make streamflow 
information available and continue to use the NOAA satellite, the USGS 
must convert its streamgages to the new high-data rate radio (HDR) 
technology by the end of 2013. Approximately 4,500 streamgages across 
the Nation have already been upgraded to HDR technology using annual 
appropriations; funding through ARRA combined with annual 
appropriations should enable the USGS to complete the conversion well 
before the 2013 deadline.
    With the $14.6 million in ARRA funding, the USGS will acquire 
equipment to upgrade streamgages in each State to HDR technology. In 
addition to HDR upgrades to approximately 2,000 streamgages, the USGS 
will use these funds to upgrade streamgages with new streamflow 
measuring technologies, including hydroacoustic flow measuring devices, 
side-looking hydroacoustic sensors, and non-contact radar units, which 
are safer than older units and reduce operation and maintenance costs. 
The new stream measurement equipment will allow the USGS to monitor 
streamflow more efficiently and provide higher quality data. In keeping 
with the Administration's focus on renewable energy, solar-powered 
technologies will be utilized to the greatest extent possible.
    It is anticipated that private vendors and manufacturers of 
equipment will need to increase production to meet this increased 
demand. Installation of the new streamgage equipment, which will 
generally take less than 1 hour at each site, will be completed during 
regular periodic servicing visits by USGS hydrologic technicians.

Oversight and Implementation
    In order to meet the President's call for transparency and 
accountability for money spent as part of the ARRA, and to fulfill 
citizens' desire to track where their taxpayer dollars are going and 
how they are being spent, the USGS has established a Recovery Act 
Oversight Board to ensure that the Bureau's projects are executed 
according to the requirements of the Act. This means that plans are 
meeting objectives, spending rates are aligned, and work is on 
schedule.
    The USGS provides weekly and monthly reports to the Department and 
the Office of Management and Budget that will track our progress. This 
information is also available on the USGS recovery Web site 
(www.usgs.gov/recovery), on the Department of the Interior's Web site 
(www.doi.gov/recovery), and at Recovery.gov.
    The USGS is implementing DOI and OMB guidelines to develop the 
administrative process by which funds will be released for the projects 
funded under the American Recovery and Reinvestment Act. The USGS has 
prepared an acquisition implementation plan and an acquisition review 
plan that were reviewed by the Department during the week of April 20. 
The USGS expects to have $56 million obligated, with $35 million in 
projected gross outlays by 9/30/2009. The USGS expects to obligate an 
additional $84 million by 9/30/2010, which would obligate the full $140 
million that was appropriated under ARRA. Of this amount, the USGS 
projects gross outlays of $116 million by 9/30/2010, with the remaining 
$24 million in gross outlays projected by 9/30/2011.

Conclusion
    The Recovery Act provides an unprecedented opportunity to address 
funding needs that could not be met within current appropriations. With 
this funding, the USGS will meet the 2013 deadline that requires the 
USGS to upgrade radio transmission on streamgages to be able to use a 
new NOAA satellite. Stations in the Advanced National Seismic System 
(ANSS) will be upgraded to meet approximately one-quarter of the goal 
set for full implementation of ANSS. The National Volcano Early Warning 
System will begin a robust upgrade to digital systems and 
implementation of newly developed instruments. Critical elevation data 
along U.S. coasts will be gathered and archived, and data preservation 
will be advanced by digitizing historic records. The USGS will address 
a large proportion of its inventory of facilities repair in order to 
provide functional and technical workspace needed to advance its 
program missions.
    The USGS welcomes this opportunity to provide the science needed to 
meet the imperatives of the Nation's challenges and to support the 
President's goals of jumpstarting our economy, creating or saving jobs, 
and enabling the Nation to thrive in the 21st Century.
    Thank you for the opportunity to testify, and I will be pleased to 
answer any questions the Subcommittee may have.
                                 ______
                                 

Response to questions submitted for the record by Dr. Matthew W. Larsen

Questions from Chairwoman Grace Napolitano
 Question 1: The outstanding question that your testimonies did not 
        answer is how many jobs will the USGS ARRA funds create?
    Answer: The Council of Economic Advisers has provided guidance that 
$92,136 of federal investment in ARRA projects is equivalent to one 
full time job year. Using this figure, the $140 million allocated to 
USGS would be projected to create or save approximately 1,500 jobs. The 
Department of the Interior is developing means of tracking actual jobs 
created to measure against this estimate.

 Question 2: What is your definition of shovel ready?
    Answer: The USGS considers ``shovel-ready'' projects to be those 
that are ready to proceed once funding is available.

 Question 3: Will the USGS lose valuable streamflow or groundwater 
        information by removing the streamgages and wells?
    Answer: The USGS will not lose any valuable streamflow or 
groundwater information by removing the streamgages and wells. These 
sites have all been previously discontinued and have not been providing 
data in the recent past.

 Question 4: Can the 1,200 streamgages be rehabilitated or upgraded for 
        use?
    Answer: The discontinued streamgages and wells are in various 
states of disrepair. It is possible that some of the existing 
structures could be rehabilitated and be put back into use. The bigger 
issue, however, is whether the site is still needed. The majority of 
the sites were discontinued because a cooperator/funding partner 
decided they did not need the data from the site anymore and no other 
potential cooperators were identified to fund the continued operation 
of the gages.

 Question 5: Should some of the ARRA funds be used to operate 
        streamgages or wells even if local funding partners cease to 
        co-fund the site? What benefits could be gained from interim 
        federal support for these gages until our state and local 
        partners regain their financial footing and what data, or 
        benefits, might be permanently lost?
    Answer: The American Recovery and Reinvestment Act of2009 (ARRA) 
(P.L. 111-5) provides appropriated funds to the USGS for a number of 
activities, including one time equipment upgrades for streamgages and 
removal of discontinued streamgages, cableways, and wells. Projects 
proposed for funding through the ARRA were required to meet a number of 
criteria, among which was a requirement that proposed projects have no 
need for additional investment beyond that provided by the ARRA funds. 
The operation and maintenance of existing streamgages, the reactivation 
of discontinued streamgages, and the addition of new streamgages to the 
existing network do not meet this criterion.
    If a decision were made to use any portion of ARRA funds to 
reactivate some of the discontinued sites to be removed and remediated 
by this project, it is very likely that these sites would only be 
operated for as long as the ARRA funds would allow. The USGS made 
significant efforts to find cooperator funding to continue the 
operation of these sites before they were originally discontinued; when 
the ARRA funds are expended, it remains unlikely that new cooperators 
could be found to fund the continued operation of these sites. Most of 
the approximately 1200 discontinued sites to be removed through the 
ARRA funding have been discontinued for many years. Operating the sites 
for 1 or 2 years with ARRA funding would provide very little beneficial 
data because the sites would likely then again be discontinued 
indefinitely.
                                 ______
                                 
    Mrs. Napolitano. Thank you, Mr. Larsen. And now we have Mr. 
Ron His Horse is Thunder, Chairman of the Standing Rock Sioux 
Tribe, Great Plains Tribal Chairman's Association at Fort 
Yates.
    Welcome, sir.

STATEMENT OF RON HIS HORSE IS THUNDER, CHAIRMAN, STANDING ROCK 
 SIOUX TRIBE, GREAT PLAINS TRIBAL CHAIRMAN'S ASSOCIATION, FORT 
                      YATES, NORTH DAKOTA

    Mr. His Horse is Thunder. Thank you, Madame Chair, for 
allowing me to testify before members of the Subcommittee. And 
not only am I the Chairman of the Standing Rock Sioux Tribe, I 
am Chairman of the Great Plains Tribal Chairmen's Association, 
which represents 16 tribes in North Dakota, South Dakota, and 
Nebraska.
    Of these tribes, many of them, off the top of my head I 
count seven of them that have given up land to this country so 
that the dams could be built under the Pick-Sloan Act. Doing 
so, those tribes lost over 400,000 acres of prime bottomland, 
land that we use for agriculture to sustain our people.
    When we lost that land, we were moved up to the dry 
prairie, the high and dry prairie, and we have been in a 
drought for almost 10 years now.
    We have been promised for losing our bottomland that we 
would get water for drinking purposes, as well as for 
irrigation purposes. But today, many of our people still live 
without running water. In fact, two weeks ago I visited an 
elderly gentleman. I didn't even know his condition, and found 
that he had no water, no well water either, and had to haul his 
water on a daily basis.
    Many of our people do still live off well water, which is 
brown in color and has minerals which are toxic if you drink 
enough of it. That still exists today.
    And so one of the things we want to ask the Bureau is this. 
Is, there are a number of shovel-ready projects for drinking 
water in the Dakotas, and some of those tribes didn't get any 
money in the stimulus package. My tribe did receive $19 
million; yes, it did. But there are a number of tribes that did 
not receive any money under the stimulus package, and we want 
to know why.
    We also want to know this. That, as a number of the 
Congressmen have testified here today that irrigation is 
necessary for a sustainable economy, is definitely so for us in 
the Dakotas when we gave up our bottomland. Again, we were 
promised irrigation. My tribe alone has today $8 million worth 
of shovel-ready irrigation projects ready to go right now.
    I know a number of other tribes also that have shovel-ready 
irrigation projects ready to go, and they have received no 
money for irrigation at all. We want to know why no money was 
given for irrigation projects.
    When you talk about unemployment, and I heard the 
Congressman talk about unemployment at 35 percent to 40 
percent, on my reservation alone unemployment in the summertime 
is 45 percent. In the wintertime, it is 76 percent. I know 
other tribes in the Great Plains who have unemployment rates up 
to as high as 90 percent. They have shovel-ready projects. We 
could put people to work.
    The last thing I want to know is this, is we did, yes, 
receive $19 million worth of money for our MR&I Project, for 
drinking water purposes. But no rules and regulations have come 
out in terms of the reporting requirements. We are concerned 
about that, that how extensive are these reporting requirements 
going to be?
    As it is right now, we spend a good portion of our 
appropriations that we normally get on reporting. How more 
extensive are these going to be? We need to be in a negotiation 
process right now at the Bureau so that when we sign our 
documents and accept the money, that not only can we spend it, 
but we know what the reporting requirements are.
    We are ready to go right now, right today we are ready to 
go bid those contracts out today. But we don't know the 
reporting requirements, and we need to know those, so that we 
can spend the money in a timely way.
    Thank you for this opportunity to testify before you.
    [The prepared statement of Mr. His Horse Is Thunder 
follows:]

Statement of The Honorable Ron His Horse Is Thunder, Chairman, Standing 
 Rock Sioux Tribe, and Chairman of the Great Plains Tribal Chairman's 
                              Association

    My name is Ron His Horse Is Thunder. I am the Chairman of the 
Standing Rock Sioux Tribe. I also serve as the current chair of the 
Great Plains Tribal Chairmen's Association. I thank Chairwoman 
Napolitano and the subcommittee for the opportunity to present a tribal 
perspective on the Bureau of Reclamation's efforts and funding under 
the American Recovery and Reinvestment Act of 2009.
    The Standing Rock Sioux Tribe is a rural reservation straddling 
North Dakota and South Dakota. More than 10,000 Tribal and non-Native 
citizens reside on our 2.3 million acre Reservation, which is slightly 
smaller than the State of Connecticut. The other Great Plains Tribes 
are similar to us--with rural reservations, a large land base, and 
substantial residential population. We all share a need for safe, clean 
drinking water for our people and irrigation for sustainable living.
    Like our fellow Great Plains Tribes, our ancestors occupied the 
lands and relied upon the waters of the Upper Missouri River basin from 
long before the Lewis and Clark expedition. Our ancestors thrived on 
the bottomlands of the rivers and streams, which provided nutrient-rich 
soil for ranching and farming, as well as a homeland for our peoples. 
However, the Federal government built dams in the 1950s which flooded 
our best farmlands and, in some instances, displaced over 90% of our 
people. We were forced to move to higher, dryer ground. Our Tribal 
communities, agricultural lands, and reservation infrastructure were 
destroyed--including roads, hospitals, schools, and homes. We suffered 
catastrophic personal and economic losses. Unemployment soared. Our way 
of life was never the same.
    Decades later, in an attempt to make the Tribes whole again, the 
United States promised--among other things--to build drinking water and 
irrigation water systems for our reservations. The Secretary of the 
Interior's Joint Tribal Advisory Committee, or JTAC, determined in 1986 
that construction of safe, complete drinking water systems would be 
essential to revitalize economic growth and public health. Safe 
drinking water systems also contribute substantially to the health of 
our people--as currently many Reservation families must still clean 
dishes and bathe themselves and their small children in brown well 
water that reeks of heavy minerals like manganese, coal, iron, and 
lime, which exacerbate diabetes. The JTAC also reported that thousands 
of additional acres needed to be irrigated in order to provide our 
Tribes with sufficient replacement agricultural lands.
    Through Congressional legislation like the Garrison Diversion Unit 
Reformulation Act of 1986 and the Dakota Water Resources Act of 2000, 
Congress authorized substantial funding for these drinking water and 
irrigation projects. The Standing Rock Sioux Tribe's municipal, rural, 
and industrial (MR&I) water system was authorized in the Dakota Water 
Resources Act at $80 million, which has increased to almost $140 
million today through cost indexing. The authorization for the Standing 
Rock Irrigation Project was recently increased by $8 million, as well, 
coming to a total of about $20 million.
    However, our drinking water systems and irrigation systems remain 
far from complete. Historically, annual funding for these projects has 
not even been sufficient to keep up with construction inflation or cost 
indexing. Tribes in the Great Plains would receive at most $1 million 
or $2 million per year for their MR&I projects, and often less. Funding 
for our Tribal irrigation project was even more sporadic. This meant 
that Tribes could only put together small bid packages, which increased 
transaction costs and the overall costs of these important water 
projects. More recently, the increased appropriations in 2008 and 2009 
allowed our Tribes to make significant progress on key MR&I components 
like water treatment plants and intakes. We hope that Congress 
continues to prioritize Tribal water projects in 2010 and beyond.
    The additional Recovery Act funding should also allow us to make 
significant progress this year. For example, the Standing Rock Sioux 
Tribe has been awarded an allocation of $19 million from the Bureau of 
Reclamation for a new water treatment plant at Wakpala, South Dakota. 
In addition to providing clean drinking water to over 1100 households 
and many small businesses in at least 8 different communities, this 
project promises to create 40 full-time construction jobs alone--and 
many, many times that number in support jobs and secondary economic 
development in the area. But there is still a long way to go. Even 
taking into account the funding provided under the Recovery Act and 
2009 omnibus appropriations, the Standing Rock MR&I project still has 
over $76 million in remaining authorization--funding which will be 
needed to complete the necessary work on intake, water treatment plant, 
pump stations, storage tanks, and transmission and distribution 
pipelines so that clean and safe water is available to everyone in our 
communities.
    We are grateful for Congress' and Reclamation's recognition through 
the Recovery Act that Tribal water projects are important and worthy of 
substantial funding, but we ask that you not fall back into old habits 
in 2010 and beyond. These clean drinking water systems are too 
important for the health, well-being, and economic development of our 
Reservations and surrounding communities. It is time for the Federal 
government to keep its promise to our Tribes. As Chairman of the Great 
Plains Tribal Chairman's Association, I also wish to note that not all 
our Tribes received Recovery Act funding, even though they have shovel-
ready projects. The Turtle Mountain Band of Chippewa and others 
received no funding and deserve to know why. I hope this subcommittee 
will ask the Bureau of Reclamation to explain its funding decisions 
fully and openly.
    In addition, despite our efforts to bring irrigation to the 
attention of decision-makers in the Interior Department and Congress, 
the Recovery Act has not provided any appropriations for Reclamation-
funded irrigation projects like the Standing Rock Irrigation Project 
and others authorized by the Garrison Reformulation Act and Dakota 
Water Resources Act. At Standing Rock, our irrigation project is run by 
the successful tribally-owned business Standing Rock Farms, Inc. By 
growing high-yield corn and other crops, Standing Rock Farms has turned 
small Federal irrigation investments into tribal profits and provided 
much-needed jobs on our Reservation. But annual appropriations have 
been woefully insufficient. Standing Rock Farms has recently entered 
into a new self-determination construction contract with Reclamation 
and has prepared almost $8 million worth of shovel-ready irrigation 
project components--which will bring well over a thousand additional 
agricultural acres online. This work includes upgrading existing pivots 
and pumps to increase efficiency and acreage, as well as new 
construction. This is exactly the kind of project that could make quick 
and efficient use of Recovery Act funding to create dozens of full-time 
jobs and substantial, long-term economic benefit to the Tribe, the 
Reservation, and surrounding areas.
    It is important that Congress and the Federal government keep in 
mind that our water projects--both MR&I and irrigation--need to be 
secure. The Dakotas recently experienced serious flooding, as you know. 
In prior years, drought and poor Missouri River management altered the 
river channel, threatening disruption to water intakes. In the worst 
instance at Standing Rock, during Thanksgiving 2003, our people had no 
water for many days. Massive amounts of sediment moved downriver and 
completely buried our water intake system. We had no water for our 
homes, our Tribal government offices, our schools, or our hospital. Our 
irrigation projects were affected, and we lost our crops. The result 
was tremendous social and economic hardship for our people. Former 
Chairman Charles Murphy testified to the Senate Committee on Indian 
Affairs about this incident in 2004. It is for these reasons that 
sufficient funding for secure intakes, pumps, pivots, and fully-
operational water treatment plants is so vital. In addition, our MR&I 
and irrigation systems can only bring benefit to the area if the water 
levels of the rivers and reservoirs are properly managed--with priority 
for drinking water for people over barge shipping and other commercial 
uses downriver.
    Finally, I understand that our funding under the Recovery Act will 
come with additional reporting and other requirements. However, our 
Tribe has not yet received word from Reclamation what these 
requirements will entail, or whether we will need to revise our annual 
funding agreements to accommodate these additional items. Due to the 
short time frame in which Recovery Act funding must be used, we ask 
your help in ensuring that the Bureau develops reporting requirements 
that are easy to use, and that the Bureau releases this information 
quickly, so that Tribes can review it and negotiate respectful and 
manageable government-to-government funding agreements that comply with 
the law and the spirit of self-determination. It has already been two 
months since the passage of the Recovery Act, and we are ready to get 
to work.
    In light of these comments, I make the following requests on behalf 
of the Standing Rock Sioux Tribe and other Tribes of the Great Plains:
      We ask your help in ensuring that Reclamation quickly 
compile and release by May 15, 2009 reasonable reporting requirements 
to comply with the Recovery Act in the spirit of tribal self-
determination;
      We seek full and open discussion of the Bureau of 
Reclamation's funding choices under the Recovery Act;
      We request that Recovery Act funding be allocated to our 
vital Reclamation-funded irrigation projects;
      We look for your continued support of our important 
Tribal drinking water and irrigation projects in the future, including 
ensuring a proper management scheme for the Missouri River basin that 
prioritizes drinking water use;
      We ask for your support in the House of Senate bill 
S.2200, the Tribal Innovative Water Financing Act, which will reaffirm 
through legislation that Tribes have the authority to leverage Federal 
funding under self-determination contracts to build safe and 
comprehensive drinking water projects in a more timely way; and
      We look to the Federal government to keep its promise to 
fully compensate our Tribes for the devastating losses when the 
government flooded our lands, including through a new JTAC package as 
has been discussed at prior hearings of the Senate Committee on Indian 
Affairs.
    Again, I thank the subcommittee for this opportunity.
                                 ______
                                 
    Mrs. Napolitano. Thank you, sir.
    I will move on to Mr. Dan Keppen, the Executive Director of 
Family Farm Alliance from Klamath Falls, Oregon.

         STATEMENT OF DAN KEPPEN, EXECUTIVE DIRECTOR, 
          FAMILY FARM ALLIANCE, KLAMATH FALLS, OREGON

    Mr. Keppen. Thank you, Madame Chairwoman and members of the 
Subcommittee. I would really like to thank you and the 
Subcommittee, for your leadership on this issue over the last 
year. We are glad to see these provisions in the final overall 
stimulus package.
    My organization represents farmers, ranchers, irrigation 
districts, and related industries in the 17 western states. All 
we focus on is the water associated with those, with those 
members.
    We feel that addressing aging water infrastructure in the 
West should be the top priority in the Reclamation Stimulus 
Package. A lot of these facilities throughout the West are 50 
to 100 years old, approaching the end of their design life, and 
they need to be rebuilt and rehabbed for the next century.
    Reclamation has estimated that $3 billion will be needed 
from project users in the near term to provide for these 
essential repairs and rehab of its own facilities. 
Unfortunately, this has been mentioned. We only count $130 
million out of $1 billion in this package that are focused on 
addressing water infrastructure.
    Overall, this package, you know, we think it is pretty 
good. It is a good mix in general. Especially there are 
projects in Washington State, Montana, the Yuma area of Arizona 
that we support. The Red Bluff Diversion Dam I think is perhaps 
the best project in this whole mix. It is a win-win for the 
environment. It opens up a stretch of the river that could 
ultimately help recover threatened, endangered species of fish. 
And importantly, for our members, it provides assurances and 
protection in the future for farmers that irrigate 150,000 
acres of some of the most productive farmland in the country.
    With that said, we do have some other concerns. Again, $130 
million out of $1 billion is going to aging infrastructure. We 
think that the reasoning for this relatively lower emphasis on 
addressing aging infrastructure probably rests within 
Reclamation's internal criteria that they use to prioritize 
these projects.
    Essentially, they are promoting larger, ready-to-go 
projects over, you know, smaller projects that might require 
some additional administrative work, in our view.
    We have grave concerns about the fact that the repayment 
provisions that were outlined in the conference report 
associated with the final bill passage were really not dealt 
with. I was encouraged to hear the Acting Commissioner's 
comments that if water users are interested and want 
consideration to allow these repainted provisions to be 
enforced, that is encouraging. Right now we haven't really 
heard a lot of that. That is a big issue for our members.
    The transfer work issue that the Chairwoman brought up 
earlier and others have mentioned is a huge issue for us. We 
just don't understand why transfer facilities, which are a 
Federal investment that are going to put people to work if we 
address them, that are essential to the well-being of our rural 
communities, why they are any different from the reserve 
facilities that are maintained essentially by the Bureau of 
Reclamation.
    The Challenge Grant Program that is in this package is a 
real important program for many of our members. It is already 
over-subscribed. It is very nice to see $40 million put into a 
program that normally gets $13 to $15 million as a cost-share 
program.
    Some of our folks are concerned that $40 million may not be 
enough. We think there could be three times, you know, the 
demand could equal three times that amount. There are also 
concerns about the limits that will be set. It will fund $1 
million to $5 million projects. Traditionally, that program is 
funded, projects costing as low as $300,000. So we are going to 
miss an opportunity to do a lot of smaller projects spread 
across the West.
    On the other hand, the upper ceiling of $5 million will 
allow many projects in the $3 million to $5 million range to be 
funded. You know, all in kind of one fell swoop, rather than 
financing these things over a longer period of time.
    I don't think I need to elaborate any further on the 
concerns that our California members have about the proposed 
drought relief program. The San Joaquin Valley is facing a 
huge, huge crisis, and the drought provisions, our guys just 
aren't seeing what that is going to do for them at this point.
    I would also like to again emphasize that, in the economic 
stimulus package, a lot of these projects will put people to 
work in the short term, and maybe the long term. That time in 
employment has never been more important.
    But we also think that stimulus funding and strong 
leadership should be directed in a way that also save jobs for 
folks that are already working. We are probably going to lose 
at least 30,000 farm worker jobs in the San Joaquin Valley this 
year.
    The stimulus package probably will not be fully realized to 
its full extent until policymakers understand and act upon the 
problems caused by regulatory gridlock. We have to get these 
projects built and implemented before the recession is over.
    There are also regulatory and administrative things that 
can be done that provide economic stimulus in a different way. 
Namely, by taking a hard look at the Endangered Species Act and 
how it is being implemented, and getting rid of this regulatory 
drought that is flagging California.
    So again, success of this stimulus proposal is important to 
our organization. And we are really trying to assure that these 
stimulus dollars are used as effectively as possible. We will 
monitor initial progress as Reclamation implements its program, 
and we will engage with Congress and the Obama Administration 
as required in the coming months.
    Thank you for this opportunity.
    [The prepared statement of Mr. Keppen follows:]

 Statement of Dan Keppen, Executive Director, The Family Farm Alliance

    Chairwoman Napolitano and Members of the Subcommittee:
    Thank you for this opportunity to submit testimony on behalf of the 
Family Farm Alliance (Alliance). My name is Dan Keppen, and I serve as 
the executive director for the Alliance, which advocates for family 
farmers, ranchers, irrigation districts, and allied industries in 17 
Western states. The Alliance is focused on one mission--To ensure the 
availability of reliable, affordable irrigation water supplies to 
Western farmers and ranchers. Our members are family farmers, ranchers 
and irrigation districts and water agencies, several of which are 
responsible for the operation and maintenance of the Bureau of 
Reclamation's largest and most complex facilities.
    We applaud the willingness of the Obama Administration, Congress, 
and this Subcommittee to apply economic stimulus funding to the 
critical condition of aging water infrastructure in the Western United 
States.
    We have reviewed the Interior Department's proposed plan for the 
allocation of $1 billion in economic stimulus funding to projects and 
programs of the Bureau of Reclamation (Reclamation). We are generally 
pleased by the plan, which funds some vitally important projects that 
will ensure security of water supplies in several states. However, the 
Alliance is concerned that the proposal allocates only about $130 
million to the rehabilitation of Reclamation's existing infrastructure, 
which the agency estimates is in need of approximately $3 billion worth 
of repairs. We are also concerned that the proposal does not provide a 
more aggressive response to the water supply crisis in California and 
that it seems to ignore new repayment authorities intended to 
facilitate non-federal funding of major repair work. I will discuss 
these and other points in more detail below.
    In the American West, Federal water supply systems are essential 
components of communities, farms, and the environment. These facilities 
are an integral part of the nation's food-production system and their 
consistent operation helps ensure our farmer's ability to provide a 
reliable and secure food supply for our own citizens and the rest of 
the world. Population growth, environmental demands and climate change 
are placing an unprecedented strain on aging water storage and 
conveyance systems designed primarily for agricultural use.
Addressing aging infrastructure should be the top priority in 
        Reclamation's stimulus plan
    Reclamation built and manages the largest part of the critical 
water supply infrastructure that is the foundation of the economic 
vitality of the 17 Western States. Much of this federally-owned 
infrastructure is now 50-100 years old, approaching the end of its 
design life, and needs to be rebuilt and rehabilitated for the next 
century. Reclamation estimates that $3 billion will be needed from 
project users in the near-term to provide for essential repairs and 
rehabilitation of its facilities. The Congressional Research Service 
has calculated the original development cost of the Reclamation water 
supply and delivery infrastructure to be about $20 billion, and 
Reclamation puts the current replacement value of the system at well 
over $100 billion.
    The Alliance believes that protecting this national asset is 
absolutely essential to American economic security, and we are 
gratified that there is strong bipartisan agreement on that point among 
Members of this Committee. We thank Chairwoman Napolitano and Members 
of the Subcommittee for their efforts to ensure that the American 
Recovery and Reinvestment Act (ARRA) included resources for the 
rehabilitation and enhancement of the Reclamation's Western water 
supply infrastructure.
    The $1 billion that Congress provided to Reclamation in the 
Recovery Act a unique opportunity to make the investments necessary to 
secure a more reliable water supply infrastructure for the West, while 
creating jobs and opportunities in economically distressed rural areas. 
Repairing and modernizing our western water infrastructure also will 
directly address some of the West's vexing water supply problems by 
improving water resource management and conservation. These in turn 
will produce greater energy efficiencies and will provide more 
flexibility to meet environmental needs, thereby alleviating conflict.
    Seizing this opportunity will require Reclamation quickly identify 
actions that will yield the greatest benefits to water supply security, 
and then move decisively to carry them out. Bureaucratic inertia must 
give way to a creative ``can-do'' approach whose goal is to channel 
stimulus resources into effective action through expansive use of 
existing programs and rapid implementation of new authorities.
Alliance Involvement with Economic Stimulus and Aging Infrastructure 
        Matters
    Earlier this year, while Congress was still working to finalize the 
economic recovery package, the Alliance provided policy recommendations 
to the Departments of the Interior and Agriculture for the use of 
anticipated economic stimulus funding for western water supply 
infrastructure rehabilitation and enhancement.
    In a February 9 letter to Interior Secretary Salazar and 
Agriculture Secretary Vilsack, the Alliance made the following 
recommendations for the most effective use of any economic stimulus 
funding made available to the Bureau of Reclamation:.
      Rehabilitate and Improve Aging Reclamation 
Infrastructure, using direct loans, loan guarantees, and extended 
repayment provisions;
      Aggressively outsource design, engineering and 
environmental work whenever feasible, economical and necessary to speed 
project implementation;
      Provide funding to speed implementation of current and 
ready-to-go Safety of Dams Program projects;
      Improve Drought Management Through Water Management / 
Conservation / Reuse;
      Fund ``Shovel-Ready'' Title XVI Water Reclamation & Reuse 
Projects;
      Provide Clean Water to Rural Areas through implementation 
of ready-to-go rural water projects, including those already under 
construction, or ``at risk'' facilities.
    We also recommended that Reclamation and other federal agencies 
find ways to streamline the federal regulatory process (i.e. NEPA) 
associated with stimulus project implementation. The entire February 9, 
2009 letter (6 pp) is included as an attachment to this testimony.
The Intent of Congress: The American Recovery and Reinvestment Act
    Title XVI of the American Recovery and Reinvestment Act generally 
lists the requirements for qualifying projects. Section 1602 of that 
title directs that, in using funds made available in the Act for 
infrastructure investment, recipients shall give preference to 
activities that can be started and completed expeditiously, including a 
goal of using at least 50 percent of the funds for activities that can 
be initiated not later than 120 days after the date of the enactment of 
this Act. Recipients must also use grant funds in a manner that 
maximizes job creation and economic benefit. Section 1603 states that 
all funds appropriated in this Act will remain available for obligation 
until September 30, 2010.
    In the statement of conferees report prepared for the Department of 
Interior, Bureau of Reclamation, Water and Related Resources, 
Reclamation was directed to consider the following criteria when 
allocating funds for stimulus programs, projects and activities:
    a.  Can be obligated/executed quickly;
    b.  Will result in high, immediate employment;
    c.  Have little schedule risk;
    d.  Will be executed by contract or direct hire of temporary labor; 
and
    e.  Will complete either a project phase, a project, or will 
provide a useful service that does not require additional funding.
    The ARRA also includes a provision authorizing Reclamation to 
provide for extended repayment of reimbursable repair and 
rehabilitation expenses by project beneficiaries, as further discussed 
below.
    Aside from these requirements, it appears that Reclamation was 
given wide latitude in regard to establishing priorities and making 
decisions to implement solutions that we hoped would maximize the water 
supplies, ensure that water data needs are met, and enhance 
infrastructure.
Overview of Stimulus Spending Recommendations for the Bureau of 
        Reclamation
    Secretary Salazar announced the stimulus spending package proposed 
by the Bureau of Reclamation earlier this month, where the importance 
of addressing Western water infrastructure needs was underscored.
    ``From aging dams to outdated water systems, America's water 
infrastructure needs immediate attention and investment,'' said 
Secretary Salazar. ``The $1 billion we are investing through the 
President's economic recovery plan will put Americans to work 
rebuilding our water infrastructure and tackling the complex and 
painful water challenges we are facing. These investments will boost 
our economy, help farmers, businesses and communities get the water 
they need to thrive and restore aquatic resources in the West.''
    Although Reclamation did not formally solicit input from its water 
customers, the agency apparently worked through a rigorous merit-based 
process to identify investments that met the criteria put forth in the 
Recovery Act. Reclamation outlined how $1 billion would be spent:
      Meeting Future Water Supply Needs (including Title XVI 
water recycling projects and rural water projects)--$450 million
      Improving Infrastructure Reliability and Safety--$165 
million
      Environmental and Ecosystem Restoration--$235 million
      Water Conservation Initiative (Challenge Grants)--$40 
million
      Green Buildings--$14 million
      Emergency drought relief in the West, primarily in 
California--$40 million
      Delivering water from the Colorado River to users in 
central Utah under the Central Utah Project--$50 million
Summary of Reclamation's Evaluation and Selection Process
    In selecting the $945 million of projects, Reclamation used a 
multi-tiered, merit-based evaluation process that considered:
    a.  The general objectives of the ARRA and Secretarial policy 
objectives (e.g., improving energy efficiency and assisting Native 
Americans);
    b.  Priorities specific to Reclamation as required by the ARRA and 
its Conference Report, and as established by the Secretary;
    c.  Reclamation's overall program priorities; and
    d.  Criteria for selection of projects within a program investment 
area.
    Notably, Reclamation developed ``Additional Criteria'' which it 
applied to its evaluation of all potential projects and programs. Key 
considerations relative to these criteria include:
      Priority was given to funding large construction work 
that is difficult to accommodate within annual budget limitations;
      The use of stimulus funding was balanced across programs 
and activities to ensure the continued delivery of public benefits, the 
operation and maintenance of facilities in a safe and reliable manner, 
and the protection of the health and safety of the public and 
Reclamation employees, and compliance with environmental requirements 
and opportunities for ecosystem restoration;
      Priority was given to larger projects to the extent 
possible in light of the workload limitations on the staff available to 
process procurements and financial assistance agreements.
    It is important to understand the criteria utilized by Reclamation 
in its selection process, since it expands upon original Congressional 
direction, as would be expected. This criteria also explains why 
larger, more expensive projects appeared to be favored by Reclamation 
over an alternative approach that would fund many more, less expensive 
proposals, an issue of some concern to many of our members.
Positive Aspects of Reclamation's Stimulus Proposal
    We are pleased that Reclamation's stimulus proposal includes 
support and funding for several types of projects recommended by Family 
Farm Alliance members:
      Washington State--Potholes Supplemental Feed Route, which 
will modify existing facilities to route water from Pinto Dam to 
Potholes Reservoir; Weber Siphon Complex, to construct second siphon 
barrels (cast reinforced concrete pipe) to the Weber Branch and Weber 
Coulee Siphons; Grand Coulee Maintenance Activities that will fund 
equipment purchases for repairs at the dam, including safety features; 
Yakima River Basin Water Enhancement Project (YRBWEP), Benton 
Irrigation District, to replace existing canals with pressurized pipe 
and change the point of diversion; and YRBWEP Sunnyside Conduit, to 
convert up to 66 laterals to closed pipe.
      Red Bluff Diversion Dam, California--this ``shovel-
ready'' project, sponsored by the Tehama-Colusa Canal Authority, is 
critical to preservation of the regional agriculturally based economy, 
and will also provide great benefit to endangered and threatened fish 
species in the Sacramento River. The completion of this project will 
benefit water users statewide by providing near-term benefits to the 
fishery resource, thereby helping to resolve some of the regulatory 
issues that are crippling the ability to effectively manage water in 
California.
      Montana--Canyon Ferry: Excitation System Replacement 
project would replace aging Excitation System on the three units at 
Canyon Ferry Powerplant; and complete design and specification for 
repair of concrete spalls in the spillway chute. The Ft Peck and North 
Central Water systems are great examples of qualified projects that 
will benefit from the ARRA (although only some components will be 
completed in the time period allotted).
      Yuma, Arizona area--$36.25 million will be used to repair 
or replace aging water management and delivery facilities to improve 
water storage capacity, water management and water use efficiencies, 
and address safety concerns related to these facilities.
      Colorado River Salinity Control Projects (Title II)--
Anticipated projects will most likely consist of replacement of earthen 
canal and laterals with pipe delivery systems. We would like to see 
this program address selenium problems by providing incentives and 
funding assistance for water users in the Gunnison Basin.
    We believe these projects are good examples of the types of 
activities that deserve Reclamation's attention in the stimulus package
Overall General Concern
    As noted earlier in this testimony, addressing aging water 
infrastructure in the West is a critical priority for Reclamation, and 
the stimulus package provides a tremendous opportunity to finally 
tackle this growing problem in a meaningful way. We were, therefore, 
disappointed to see that, out of the $700 million in Reclamation 
stimulus funding not allocated to Title XVI rural water, CALFED, and 
other programs, only $130 million is proposed for addressing existing 
water infrastructure ($24 million Safety of Dams and $10 million in 
Canal Safety money are included in the $164 million figure noted on 
page 4).
    This suggests to our membership that Reclamation does not share our 
view that aging infrastructure is a high priority. However, we know 
that is not the case, and instead, the reasoning for the relatively 
lower emphasis on addressing aging infrastructure may rest instead 
within Reclamation's internal criteria that essentially promotes 
stimulus funding for fewer and larger ready-to-go projects. Reclamation 
apparently believes it will be easier to implement that approach, 
rather than spreading the money out to encompass more, smaller projects 
that could be made ``shovel-ready'' with some additional effort.
    We appreciate the balanced approach Reclamation is attempting to 
take with this spending opportunity. We are on record for supporting 
stimulus resources directed to funding the federal share of existing 
Title XVI projects that are ready for construction or can be made ready 
for construction within the timeframe prescribed by the stimulus 
legislation. These reclamation and reuse projects augment existing 
urban water supplies and thereby reduce pressure on agricultural and 
rural supplies. We also understand the need for Reclamation to support 
environmental/ecosystem restoration efforts intended to make Western 
U.S. rivers, streams and estuaries healthy. In many cases, these 
restoration efforts have direct water supply benefits for irrigators.
    However, there are numerous other government agencies tasked with 
clear directives to steward environmental restoration efforts and fund 
urban water conservation projects. At the same time, there are very 
limited funding programs to support repair and modernization of aging 
agricultural water infrastructure. So, unfortunately, it is difficult 
to see a Reclamation stimulus proposal that provides $500 million more 
for environmental restoration projects and new urban and rural domestic 
water programs than it does for rehabilitation of existing irrigation 
supply and delivery facilities.
    We appreciate that Reclamation acknowledges that investments in 
infrastructure reliability will create immediate construction, 
engineering and scientific jobs. Again, however, only $130 million has 
been slated for high priority infrastructure repair and replacement 
projects across the entire West. This is a tough pill to swallow for 
many Western irrigators, especially when $13.5 million is being 
provided for ``green'' buildings for Reclamation at Boulder City, 
Nevada. Meanwhile, farmers within Bureau of Reclamation service areas 
in California are receiving only 10% of their water supplies (see 
below). This allocation is an unprecedented, record low delivery amount 
for Central Valley Project agricultural contractors. These producers--
as well as the communities and consumers who rely upon them--will all 
suffer as a result.
Specific Concerns
    We have several concerns and observations regarding some specific 
provisions of the recent Reclamation stimulus proposal, including 
repayment, transferred works, the suite of actions proposed for 
California, and the level of funding for Challenge Grants. These 
concerns are further detailed below.
Repayment Period
    The Conference Report (final bill) authorizes the Secretary of the 
Interior to extend for up to 50 years the repayment period for the 
reimbursable costs of extraordinary maintenance and replacement 
activities carried out with stimulus funding. Extended repayment is 
with interest. However, nowhere in Reclamation's 40-page explanation of 
its proposed stimulus package is the 50-year repayment language from 
the stimulus bill mentioned.
    The ARRA provides extended repayment authority that the ARRA 
provides for extraordinary Operations and Maintenance (O&M) work, which 
clearly gives Reclamation the authority to finance O&M work, the costs 
of which are the responsibility of non-federal interests. The absence 
of the extended repayment authority from the Reclamation program 
document, plus the fact that the Reclamation project selection criteria 
penalize projects that require new repayment contracts, raises concerns 
that Reclamation intends to ignore this authority.
    It would be helpful for Reclamation to publish and explanation of 
how it plans to carry out the provisions of the stimulus act 
authorizing up to 50-year repayment periods for extraordinary O&M 
projects.
Transferred works
    There are two general classifications for Bureau of Reclamation 
facilities, depending on the entity responsible for operating those 
facilities. ``Reserved facilities'' are those operated by Reclamation, 
while ``transferred facilities'' are operated by non-federal 
authorities, several of which we represent. Of great concern to our 
members is that Reclamation's program specifically EXCLUDES transferred 
works. See this reference on page 2 of ``Selection Criteria'' section 
(page 21 of the PDF document):
    ``...project features which water users have assumed the 
responsibility to operate and maintain at their own expense and with 
their own workforces (referred to as transferred works), were 
eventually eliminated from consideration since it is not Reclamation's 
obligation to finance the maintenance and replacement of these 
facilities even though they are federally owned.''
    The exclusion of transferred works is a concern for our 
organization. Reclamation's claim that is has no ``obligation to 
finance the maintenance and replacement of these facilities'' is 
legally correct but it is also counterproductive in the context of the 
APPA's goals to create jobs by repairing infrastructure. Some of the 
largest projects in the Reclamation system are transferred works. Why 
would they be made ineligible for stimulus funding? Using stimulus 
money to repair or upgrade federally owned transferred works would not 
relieve non-federal contractors from their obligation to pay for such 
work, it would only make it easier for them to repair the federal asset 
faster. Further, it is illogical to make distinction between reserved 
and transferred works in stimulus funding allocation because non-
federal interests are responsible for O&M costs for both kinds of 
projects. Who performs the actual work seems to us to be irrelevant to 
the question of where stimulus funding should be applied.
    The Committee needs to understand that these facilities are still 
federal assets, and that only the O&M responsibilities--NOT the title 
of the assets--were transferred to beneficiaries. Reclamation has an 
obligation to make sure these assets are maintained for the security of 
the country as a whole. The Committee should ask Reclamation to justify 
why it believes that Congress did not intend that stimulus authority be 
used for projects on transferred works.
Challenge Grants
    Reclamation's Challenge Grant component of the stimulus proposal 
provides 50/50 cost-share grants for water conservation projects, 
advanced water treatment demonstrations, and other projects that 
benefit candidate and Endangered Species Act (ESA)-protected species. A 
total of $40 million of the stimulus money is to be shared across the 
West, with $1 million minimum and $5 million maximum grants for 
irrigation district-generated on-the-ground projects. This program has 
been funded by Congress at about $15 million per year and has a history 
of oversubsription, so the $40 million allocated in the stimulus plan 
is a welcome infusion of resources into a popular and effective 
program.
    We know of several ``shovel ready'' projects proposed by local 
irrigators which we believe can score very well in all aspects of this 
ARRA Challenge Grant application. Many of these projects will be 
seeking $3 to $4 million each and several projects have been ``phased'' 
over time to take advantage of existing state and federal loan/grant 
programs. The higher ceiling of $5 million proposed by Reclamation will 
provide an opportunity to complete these projects all at once.
    However, other irrigators are concerned that the minimum grant 
amount--traditionally set at $300,000--has been raised to $1 million. 
The new, higher minimum limitation eliminates many smaller projects, 
which reduces the total number of projects across the West.
    Reclamation should provide clear justification for this important 
change. Further, Reclamation should look for ways to allocate even more 
substantial amounts of stimulus funding to the over-subscribed water 
conservation and management Challenge Grant program and other existing 
cost-shared programs for planning, designing, or constructing 
improvements to water infrastructure that conserve water, provide 
management improvements, and promote increased efficiencies. We 
anticipate that there will be intense competition for the limited 
Challenge Grant dollars. Some of our members believe that $120 million 
in Challenge Grant funding--triple the amount proposed by Reclamation--
will be needed to satisfy the demand for this program.
San Joaquin Valley Projects and Actions
    While Family Farm Alliance members in Northern California welcomed 
Secretary Salazar's April 15 announcement that provided $110 million 
for Red Bluff Diversion Dam improvements (see ``Positive Aspects''. 
above), the reaction of irrigators and water managers in the San 
Joaquin Valley can probably best be summed up in the words of 
California Congressman Jim Costa (D-Fresno), who released a statement 
that same day.
    ``Today's announcement''. is very disappointing in that it does 
little to help our farmers and farm workers in the next six to twenty-
four months, should we continue to experience ongoing dry 
circumstances,'' said Rep. Costa. ``The major portion of projects 
identified is focused on fisheries and environmental projects, and 
neglects the human needs. Many towns in my district are experiencing 
Depression-level unemployment due to a lack of water for our farms 
right now. What is unclear is how the identified projects address these 
real human needs.''
    The Reclamation stimulus proposal includes $40 million for 
``Emergency drought relief'', much of which will likely be spent in 
California. Parts of California are currently experiencing hydrologic 
and regulatory drought conditions, which will have devastating economic 
impacts to farmers and the rural communities they support. Under the 
Drought Relief Act of 1991, and other authorities, Reclamation intends 
to fund emergency drought relief projects that ``can quickly and 
effectively mitigate the consequences of the current drought by making 
the greatest quantities of water available for areas that are hardest 
hit''. These projects include ESA mitigation efforts, water transfers 
and exchanges, installation of groundwater wells, installation of rock 
barriers in the Sacramento Delta, and installation of temporary water 
lines.
    According to our members in the San Joaquin Valley, these projects 
will do very little to help Central Valley water users. In fact, our 
members were unaware of anyone even working on a project to ``install 
rock barriers in the Delta''. There appears to be nothing relevant, 
immediate or helpful to beleaguered agricultural water users in the 
California drought package. This is very frustrating, and has 
engendered a feeling among San Joaquin water users that Reclamation is 
staring an emergency straight in the face, but does not appear to be 
willing to do anything extraordinary with regards to dealing with the 
emergency. They believe Reclamation needs to start taking some risks, 
including taking forceful administrative action to confront the 
crushing weight that fisheries regulations are exerting on Central 
Valley Project water operations.
    San Joaquin Valley water users have proposed several meaningful 
project proposals which have been rejected by Reclamation for a variety 
of reasons. Notable among these is a $35 million proposal to install 
Techite / RPM pipe by Westlands Water District, which was rejected by 
Reclamation on their determination that it is not shovel-ready and 
needs to complete NEPA and ESA processes. Westlands disagrees.
Time Constraints
    Some ``shovel ready'' projects such as Idaho's Minidoka Dam 
rehabilitation project (ready to start this fall) were not funded by 
Reclamation because (they were told) they would not be completed in 
time. The Minidoka Dam Spillway project is set to begin next year, but 
the completion time line could be shortened if funding was provided at 
this time. Currently, this project is estimated to cost $60 million, 
with the Bonneville Power Administration paying 50%, the federal 
government covering 8% and the water users responsible for 42% of 
costs. The benefit of stimulus dollars for the Minidoka Dam spillway 
project is that additional funds can cover the non-federal share of the 
construction costs, which would be repaid over time, as directed in the 
stimulus bill provisions (but apparently ignored by Reclamation, as 
noted above). Based on this and other decisions, many of our members 
are demanding to know how Reclamation is going to spend $1billion in 
less than one year if the agency excludes many projects from funding. 
This is another example of how water users would like to see 
Reclamation take a risk, get creative within legal limits, and help the 
local Idaho water users achieve a meaningful infrastructure fix.
    Reclamation's customers need to be convinced that the agency is 
being as aggressive and creative as possible in ensuring that good 
projects meet the ``shovel-ready'' criteria. As it stands now, our 
membership is concerned that Reclamation disqualified potentially 
shovel-ready projects in order to minimize its workload.
Program Management
    We offer a few additional observations and recommendations, 
intended to assist Reclamation in its efforts to efficiently and fairly 
administer the challenging stimulus program. Reclamation should be 
encouraged to conduct preliminary work on near-priority projects in 
case higher-ranked priority projects are stalled or do not move forward 
in a predicted manner. We also recommend that Reclamation maintain and 
update a complete list of ranked priority projects, including those 
funded with ARRA funds, and those that remain unfunded.
Economic Stimulus Through Regulatory Flexibility
    Despite the focus of this testimony on specific provisions of the 
proposed Reclamation stimulus package, we cannot lose sight of a simple 
but key understanding: this is an economic stimulus package. Most of 
the projects funded by Reclamation will create (at least temporarily) 
jobs and put people to work in a time when employment has never been 
more important. We also think stimulus funding and strong leadership 
should be directed in a way that also saves the jobs for folks that are 
already working. Nowhere is there a riper opportunity to save tens of 
thousands of jobs through leadership, reason and flexibility than what 
currently exists in California.
Streamline the Federal Regulatory Process
    The slow pace of the federal regulatory process is likely to be a 
major obstacle to implementation of projects and actions that could 
employ stimulus funding to secure the Western water supply 
infrastructure. The goals of the economic stimulus legislation--job 
creation, renewed economic activity and an improved national 
infrastructure--could well be stymied by a protracted, duplicative and 
overly-complex regulatory process.
    During consideration of the omnibus legislation in the House 
Transportation and Infrastructure Committee, Chairman James Oberstar 
said, ``This is a national emergency, and business as usual is not good 
enough anymore. If the purpose of this legislation is to be achieved, 
then we must set tight deadlines, and hold everyone accountable to 
them, both the federal agencies and the state and local grant 
recipients.''
    We couldn't agree more.
    The Department of Interior must work on an urgent basis with other 
appropriate federal agencies to streamline the regulatory process into 
one that is efficient, fair and effective.
    The stimulus bill recognizes the need for streamlining and provides 
funding for that purpose. It directs that National Environmental Policy 
Act (NEPA) reviews be ``completed on an expeditious basis and that the 
shortest existing applicable process'' under NEPA be used. The same 
principle should be applied to Endangered Species Act (ESA) and Clean 
Water Act reviews of ready-to-go projects. This can be accomplished 
through improved Inter-agency coordination and simultaneous rather than 
sequential project review by regulating agencies.
    In fact, there is a provision in Reclamation's NEPA guidelines 
which allows Reclamation to accept local environmental compliance (such 
as CEQA, in California) as the basis for their NEPA compliance. It has 
been our experience that Reclamation historically has been hesitant to 
use this flexibility. The accelerated nature of this ARRA would lend 
itself to using this provision, at least in California, where many 
projects have already undergone CEQA reviews.
An Opportunity to Apply Regulatory Relief to Achieve Economic Stimulus
    After 3 consecutive years of dry conditions--and due to mounting 
environmental restrictions that have moved water away from agricultural 
and towards fish like the Delta smelt--the allocation for California's 
Central Valley Project (CVP) agricultural water service contractors 
south of the Delta stands at a paltry ten percent. The impacts to 
growers on the West side of the San Joaquin and Sacramento Valleys will 
be severe, and ramifications will ripple through the rest of the state 
(and nation) as well. Thousands of acres are being fallowed, upwards of 
30,000 farm workers will lose their jobs, and loss income in the San 
Joaquin Valley could exceed $1 billion. The impacts will ripple 
outward, since a significant percentage of winter vegetables are grown 
in the Central Valley for consumption by the rest of the country.
    Much of the recent crisis is driven by recent declines noted in 
some Bay-Delta fish populations. There appears to be no doubt that some 
Delta fish populations have plummeted, and it is equally clear that 
current methods of ``recovery'' are not working. Those efforts focus 
almost exclusively on operation of the state and federal water project 
pumps that pull water from the Delta and send it to Central Valley 
farms and Southern California. As noted in a recent Information Quality 
Act request we filed with the U.S. Fish and Wildlife Service, because 
there is no correlation between abundance of delta smelt and project 
export pumping activities, it cannot be said that project operations 
are responsible for declines in delta smelt abundance. And yet...the 
federal agencies continue to focus on those pumps, and the fish do not 
appear to be responding.
    In the meantime, continuing environmental litigation is destroying 
Central Valley agriculture. Almost 300,000 acre-feet of water have been 
lost to the ocean since the first of the year instead of supplying the 
farms and homes it was intended to serve (see attached figure). This is 
in addition to the water that was lost last year due to these 
questionable environmental regulations. For a reality check that 
demonstrates how litigation and regulation have made this year's 
drought worst for San Joaquin Valley farmers than in previous, even 
drier years, please see ``Description from the San Luis & Delta-Mendota 
Water Authority Regarding the Current South-of-Delta CVP Water Supply 
Situation'', attached.
    It would appear that Congress and the Administration have an 
opportunity to provide some temporary economic relief in the form of 
legal or administrative proposals intended to give the benefit of doubt 
to hard working American farmers and farm labor while sound, long-term 
solutions to fisheries challenges are developed. The questionable 
science employed by U.S. Fish and Wildlife Service in its recent Delta 
smelt opinion is justification enough for political leaders to take 
action to protect tens of thousands of farming jobs in California.
    Political leadership and administrative flexibility can provide 
their own brand of economic stimulation. Many in the San Joaquin Valley 
had hoped that the Department of Interior would dedicate a balanced 
portion of the stimulus funding towards projects that would afford the 
operational flexibility for providing a reliable supply of water to 
meet the needs of distressed communities. That has not happened. 
Perhaps it is not too late, however, to provide stimulus ``in-lieu'' of 
using federal funds and instead applying administrative and legislative 
regulatory relief to keep people working in the San Joaquin Valley.
Conclusion
    Success of the Reclamation stimulus proposal is important to the 
family farmers and ranchers of our membership, and our observations are 
intended to ensure that federal stimulus dollars are used as 
effectively as possible. We intend to monitor initial progress on 
Reclamation stimulus-funded projects and will engage with Congress and 
the Obama Administration as required in the coming months.
    Thank you for this opportunity to present our views today.
Attachments:
    1.  Figure of Export Water Lost to San Joaquin Valley in 2009 Due 
to Delta Smelt Biological Opinion
    2.  ``Description from the San Luis & Delta-Mendota Water Authority 
Regarding the Current South-of-Delta CVP Water Supply Situation''
    3.  February 9, 2009 Family Farm Alliance Letter to Interior 
Secretary Salazar and Agriculture Secretary Vilsack
    [NOTE: Attachments have been retained in the Committee's official 
files.]
                                 ______
                                 
    Mrs. Napolitano. Thank you, Mr. Keppen.
    And we move on to Mr. Atwater, the Chief Executive Officer 
and General Manager of Inland Empire Utilities Agency, 
President of WateReuse Association in Chino.

  STATEMENT OF RICH ATWATER, CHIEF EXECUTIVE OFFICER/GENERAL 
    MANAGER OF INLAND EMPIRE UTILITIES AGENCY, PRESIDENT OF 
            WATEREUSE ASSOCIATION, CHINO, CALIFORNIA

    Mr. Atwater. Thank you very much, Madame Chairwoman and 
Ranking Member Morris-Rodgers, and the other members of the 
Committee and other Members of Congress.
    I really do appreciate the opportunity to speak before you 
today. First, I want to compliment the Chairwoman for her 
wonderful leadership in championing both not only Title XVI, 
but looking at creative, innovative ways to solve water 
problems throughout the West.
    And one of the themes that I want to talk about today is 
these problems have been going on for a long time, and we need 
to be strategic about how do we solve problems. And I will give 
you some suggestions on how we do that.
    And certainly, in the stimulus package and what Secretary 
Salazar announced, as Congressman Costa alluded to, 10 days ago 
$135 million for water recycling. It is a great down payment 
from my perspective to helping to solve problems, not just in 
California, but in Las Vegas, and in Denver, and along the Rio 
Grande, and throughout the West, and frankly, throughout the 
United States.
    First of all, let me just give you a little bit of 
background. For those who don't know me, I am President of the 
Wate'Reuse Association. And if you go back, I will just date 
myself by the last three droughts that have affected the West 
rather dramatically. In 1976/1977, I was in Las Vegas when the 
Colorado River bailed out the California drought by giving 
southern California full aqueduct. And we in those days 
recognized that water shortages were going to be a recurring 
problem. And unfortunately in 1981, California didn't pass the 
Bay Delta Solution, the Peripheral Canal.
    In 1986 I worked very closely with Congressman Costa when I 
was at the Metropolitan Water District. He was right then. We 
are still working on the same issues in Bay Delta. And we need 
to solve that problem. And we can talk a lot about that, but I 
don't think we have enough time this morning. But we do have a 
briefing this afternoon at 2:00.
    Third, in 1990, we were in the second year of the Colorado 
River drought and the California drought. MWD, the Bay Area, 
everybody was on water ration.
    Secretary Manuel Lujan, Congress hadn't acted. Commissioner 
Dennis Underwood came to San Diego and announced a press 
conference. They said, you know the way to solve our problem 
statewide? Initiate the Southern California Reuse Study. It the 
Bureau of Reclamation, he said, in Las Vegas. It was in 
Phoenix, and in southern California in the Bay Area, for 
agriculture in the San Joaquin Valley.
    They said, you know what? We need to use this water we are 
dumping in the Pacific Ocean. It wasn't Congress. Congress 
enacted it in 1992, but it was the leadership of Secretary 
Lujan and Commissioner Dennis Underwood that embarked on that.
    I say that because Chairwoman Napolitano and I when she was 
Mayor of Norwalk and I was working with the agencies in LA 
County working with the drought. That is when we started it. 
And of course, as Congressman Miller sits down, he is the one 
that championed that bill that helped us solve the water 
problems in LA County.
    So I bring that back throughout, and today. Since 2000 the 
Colorado River has been on a drought. All seven basin states 
want to stretch the supplies from Denver to Albuquerque to 
Phoenix to Las Vegas to Southern California. We are not making 
new water on the Colorado River. Lake Mead and Lake Powell are 
in the worst condition they have ever been.
    What do we need to do? We need to structure our supplies 
and look at more efficiency, including reuse, et cetera. And 
over the last 10 years in my area, in Chino Basin, we have been 
working with communities in Congressman Baca's area, 
Congresswoman Napolitano. The former Chairman Ken Calvert has 
been a wonderful champion of reuse in Riverside and San 
Bernardino County. The economic engine of California--and also, 
by the way, we have the largest concentration of dairy cows in 
the United States--we did innovative renewable energy and reuse 
projects to keep those different sectors of the economy going. 
But it is a real struggle now.
    So what I would like to point out is when we look at the 
stimulus package, it is a wonderful down payment, and certainly 
the leadership of Secretary Salazar and the bipartisan effort 
of this Committee to support innovative water solutions, like 
reuse, encouraging the Bureau of Reclamation to promote water 
conservation, and I would say even more today, which is 
something I think is really important, but throughout the 
United States, the energy footprint of water use and renewable 
energy is a critical energy that we need to examine.
    In southern California it takes six to eight times more 
energy to move water from Lake Shasta or Lake Orville to San 
Diego, as it does to reuse water to put it on the city park. 
And when you consider how much money we spend to purify that 
water to making it into drinking water, and then they use it to 
irrigate a golf course, or put it in a power plant? Frankly, 
that is a dumb, very wasteful strategy.
    Likewise, Irvine Ranch had it right 40 years ago. All those 
strawberries, all that produce in Irvine Ranch, Mission Viejo, 
and where I work, a third of our customers on reuse are 
agriculture. That is a sustainable supply. They don't worry 
about droughts any more.
    So I would suggest we all need to work together to figure 
out to structure our supplies throughout our West. And then, 
bottom line, is to create jobs.
    Let me just point out that the $135 million out of the $1 
billion in the Bureau's package for Title XVI, because it is 
capped at a 25 percent cost share, results in a half a billion-
dollar investment in the next two years. A half a billion.
    So it creates half as much as the whole billion dollars 
going to Commissioner McDonald. And it is jobs and cities and 
areas, like in our area where we have foreclosure rates of 20 
percent. Not quite as bad as the San Joaquin Valley, but I 
think Congressman Baca and Congresswoman Napolitano will say 
the unemployment rates in their service areas are rather 
dramatic.
    So I would just point out that that has a huge benefit, and 
a ripple effect throughout the economy.
    So with that, I know my time is up, and I will be happy to 
answer any questions you may have.
    Thank you.
    [The prepared statement of Mr. Atwater follows:]

        Statement of Richard Atwater, Chief Executive Officer, 
 Inland Empire Utilities Agency, on behalf of the WateReuse Association

Introduction
    Madam Chairwoman, Ranking Member McMorris-Rodgers, and members of 
the Subcommittee, the WateReuse Association is pleased to appear before 
you and have the opportunity to present our testimony on the status of 
the Title XVI program and the value the American Recovery and 
Reinvestment Act (ARRA) has given this program through the injection of 
$135 million in assistance. At the outset, the Association wishes to 
thank you publicly, Madame Chairwoman, for the leadership you have 
provided over the years to ensure that Title XVI's objectives are 
realized. Throughout the West your leadership has provided the vision 
that recycling and reusing water is the most significant new water 
supply available today to address our serious water shortage problems!
    Aside from the record commitment of leadership provided in the 
ARRA, because of your efforts and others on the Subcommittee, including 
Representative George Miller, the Fiscal Year 2009 budget contains a 
record level of resources for this program. Your efforts mean that not 
only can we create jobs, but can also develop environmentally 
protective water supply projects to help the West ameliorate the 
deleterious effects of the ongoing drought. I also want to express our 
sincere appreciation for your support of the recent passage of the 
Omnibus Public Lands Management Act that included a number of vital 
water project authorizations that set the stage for increased water 
supply production facilities in the years to come.
    I appear before the subcommittee in my capacity as President of the 
WateReuse Association. I am also Chief Executive Officer of Inland 
Empire Utilities Agency (IEUA), located in Chino, California. By 
implementing aggressive conservation programs, including expanding our 
innovative recycling and desalting technologies to reuse our water 
supplies, we have reduced our potable water demand by 20% over the past 
five years. IEUA is a municipal water district that distributes 
imported water from the Metropolitan Water District of Southern 
California and provides municipal/industrial wastewater collection and 
treatment services to more than 850,000 people within a 242 square mile 
area in the western portion of San Bernardino County. The Inland Empire 
region is the ``economic engine'' of California and among the top 10 
job creating regions in the US.
    As a way of introduction, the WateReuse Association (WateReuse) is 
a non-profit organization comprised of more than 175 public agencies 
(plus an additional 200 associate members) that provide water supply, 
wastewater treatment, and water management services to communities 
throughout the nation. WateReuse's mission is to advance the beneficial 
and efficient use of water resources through education, sound science, 
and technology using reclamation, recycling, reuse, and desalination 
for the benefit of our members, the public, and the environment. Across 
the United States and the world, communities are facing water supply 
challenges due to increasing demand, drought, and dependence on a 
single source of supply. WateReuse addresses these challenges by 
working with local agencies to implement water reuse and desalination 
projects that resolve water resource issues and create value for 
communities. The vision of WateReuse is to be the leading voice for 
reclamation, recycling, reuse, and desalination in the development and 
utilization of new sources of high quality water in an environmentally 
sustainable manner consistent with the nation's priority to reduce 
energy consumption.
    Today, I will address a number of matters on which the Subcommittee 
asked WateReuse to provide input. I believe the issues can best be 
summarized by stating that water recycling and Title XVI offer a proven 
means to meet the challenges of drought plagued regions of the West 
while simultaneously reducing demand on energy consumption that would 
otherwise be required to deliver water supplies over hundreds of miles 
to meet municipal and industrial needs.
The Bureau of Reclamation's Title XVI Reuse and Recycling Program and 
        the Economic Simulative Effect
    Today, the West faces two simultaneous daunting challenges. The 
first is drought and the impacts of continued climate gyrations--wild 
swings in previously established weather patterns. The second is the 
unprecedented growth throughout the western states. Population 
continues to not just grow, but accelerate throughout the West! The 
Title XVI Water Recycling Program enables water users in the West to 
stretch existing supplies through the application of reclamation, 
reuse, recycling and desalination technologies within watersheds that 
do not have any other available new water supply. Title XVI was 
initially authorized in 1992, following a severe multi-year drought in 
California and other western states. A drought of equal severity 
reduced the mighty Colorado River to record lows only a few years ago. 
We must find ways to expand the nation's water supplies and do so 
without generating regional or environmental conflicts. Reusing 
existing supplies and stretching those supplies is a significant part 
of the solution. The Title XVI program provides the authority and 
framework to accomplish these water resource development objectives to 
meet the needs of our cities and urban areas, our farms and ranches, 
and our diverse environment.
    President Obama signed the American Recovery and Reinvestment Act 
(ARRA) into law on February 17, 2009. With this action, Title XVI was 
catapulted forward into the mainstream of efforts to revitalize the 
nation's economy. Within ARRA, a minimum of $126 million was allocated 
to Title XVI. We are grateful for the recent announcement from 
Secretary of the Interior Salazar that the Department will provide $135 
million to support water recycling projects construction. This decision 
means that drought starved communities and regions and where the 
recession has been particularly devastating to local economies are now 
in a position to address two problems at once. When Congress was 
debating ARRA, organizations such as WateReuse highlighted the value 
that infrastructure assistance can lend to the economic recovery. In 
fact, there is only one true way to reverse economic decline and create 
an immediate multiplier effect from the federal assistance. This is 
building public works. In the case of water recycling and reuse 
projects, the benefits are more than just the immediate jobs creation 
effect of ARRA. Water, as we all appreciate, is the building block of 
life and economic activity. If oil becomes too expensive, we can shift 
our energy demands to other sources. But if reliable water supplies dry 
up, our industries, ranging from agriculture to manufacturing to 
retail, cannot sustain their business operations. This is why water 
recycling and reuse are important. As a former Secretary of the 
Interior stated, water recycling is the last untapped river in America. 
When communities construct these facilities, they are creating water 
supplies that are reliable and safe. They are using this last untapped 
river to support a strong and vibrant economic base irrespective of the 
unreliability of Mother Nature.
    Therefore, water recycling and reuse project construction 
assistance is one of the best ways to address the current economic 
downturn. The assistance will help local communities generate jobs 
immediately and those jobs will create projects that sustain long-term 
economic activity. I also highlight the fact that water reuse is 
``green'' and ``eco-friendly.'' Water reuse is the process of 
converting a waste product into a resource that is highly beneficial. 
Moreover, water reuse projects have the additional benefit of 
offsetting demands on limited potable water supplies. Energy costs 
related to pumping, conveyance and storage are dramatically reduced 
because of the local nature of the project, thereby enhancing the 
economics of recycling and reuse. And last, by reducing demands on 
potable supplies, we are helping to make scarce water supplies 
available to support ecosystem needs such as the California Bay-Delta 
Watershed.
    The law clearly states that projects that are ready to go are those 
that can use assistance within the next two years. We consider that a 
project that is ready to go or ``shovel ready'' is one that has its 
regulatory approvals in place to allow for actual design and 
construction to proceed. Because Title XVI is a program that depends on 
specific project authorizations, the selection and award of stimulus 
assistance should be straightforward and expeditious. Any attempt to 
establish a mechanism or process to determine which projects should 
receive funding is unnecessary given the Bureau's recently revised 
``Directives and Standards.''
    We believe that the best use of the assistance is through funding 
projects without delay. Today, the nation is in an economic recession 
that has few historical precedents. Construction costs have declined 
significantly from just a few years ago when costs were escalating at 
rates of 10 to 15% because of high demand for infrastructure around the 
globe. Today, we can move forward on construction projects and deliver 
cost savings to our ratepayers. This savings is tantamount to an 
additional grant to the project. Because the stimulus funding will only 
begin to address project backlog, the assistance should target 
completion of ongoing authorized and appropriated Title XVI projects. 
Assistance that remains should be equitably targeted to yet to be 
initiated ``new starts'' that have not been funded yet to ensure that 
construction cost savings can accrue to these projects also.
    We consider ARRA as a means to an end. We are hopeful that ARRA 
combined with the Fiscal Year 2009 budget that committed a record 
funding level to the Title XVI program signals that Congress and the 
Administration will maintain and increase support for this worthwhile 
program in the future. This commitment is needed. When ARRA was under 
debate, WateReuse provided Congress with a survey of its memberships 
needs. We found that more than $5 billion in ``ready to go'' to 
construction projects exist. This level along with the $655 million 
backlog of authorized projects within the Title XVI program illustrates 
that we must build on the foundation ARRA created. If we do grow this 
commitment, we will continue to generate jobs, green jobs, and ensure 
that one of the most effective weapons to battle drought impacts, 
climate change impacts, and ecosystem needs is readily available.
    As we discuss the importance of federal assistance to develop 
locally developed water supplies, we inevitably encounter questions 
over whether water recycling and reuse is a U.S. Bureau of Reclamation 
(USBR) mission. Over the years, this subcommittee has heard concerns 
over how USBR considers Title XVI to fit within the agency's overall 
mission. From a parochial view, WateReuse has had a productive and 
sound working relationship with the agency through the WateReuse 
Foundation, which carries out cutting edge applied research to support 
the advancement of water recycling, reuse, and desalination. At the 
same time, federal budgets have over the past several years been 
lacking in the commitment to programs like Title XVI. The documented 
effects of climate change upon water supplies and the imperative to 
find environmentally sustainable responses, suggests to us that the 
debate about what level of priority water recycling should hold for 
USBR is over. The law and the climatological challenges to our society 
are clear. This must be a top tier priority for USBR in carrying out 
its mission. This is not just the opinion of the WateReuse Association. 
The Congress codified water reuse and desalination into the Bureau's 
mission when it enacted P.L. 102-575 in 1992 and reaffirmed it with the 
specific cost sharing provisions in the 1996 re-authorization.
Experiences with the Title XVI Program and Program Benefits
    The Title XVI program has benefited many communities in the West by 
providing grant funds that made these projects either affordable or 
more affordable. The Federal cost share--although a relatively small 
portion of the overall project cost--often makes the difference in 
determining whether a project qualifies for financing. In addition, the 
Federal funding and the imprimatur of the United States government 
typically results in a reduced cost of capital.
    The Association believes, first and foremost, that the Title XVI 
program serves a Federal interest as discussed below. Although the 
level of funding, until this year, that the program has received over 
the past decade has been limited, it is still an unqualified success. 
Simply stated, this is one program that represents a sound investment 
by the Federal government in the future of the West. It delivers 
multiple benefits to stakeholders throughout the West, ranging from 
municipal and industrial to agricultural needs. The Federal investment 
of Title XVI assistance has been leveraged by a factor of approximately 
5:1. According to a 2004 Council on Environmental Quality study the 
non-Federal investment amounted to $1.085 billion. We do not know of 
any other federal water program that delivers such a significant 
investment by local communities. This is clearly an ``economic'' 
stimulus program that represents a cost-effective return for the 
Federal investment in solving the nation's water problems!
    In enumerating specific project benefits, we must not forget the 
intangible benefits that exist when this critical new water supply is 
brought on line in addition to the financial value of such projects. 
These benefits include the following:
      Environmental benefits realized through the conversion of 
treated wastewater into a valuable new water supply and the ``green 
jobs'' from building new water infrastructure;
      Reduction of the quantity of treated wastewater 
discharged to sensitive or impaired surface waters;
      Alleviating the need to develop new costly water supply 
development projects unless they are a last resort (e.g., new dams and 
other expensive importation aqueducts);
      Reduced dependence on the Colorado River and on the 
CALFED Bay-Delta System, especially during drought years when demands 
on both of these water systems are particularly intense;
      Creation of a dependable and controllable local source of 
supply for cities in arid and semi-arid climates such as El Paso, 
Phoenix, and Las Vegas;
      Reduced demand on existing potable supplies; and
      Energy benefits, including reduced energy demand and 
transmission line constraints during peak use periods, realized by the 
replacement of more energy-intensive water supplies such as pumped 
imported water with less energy-intensive water sources such as 
recycled water (recycled water use at a park in San Diego in lieu of 
imported water from MWD uses about one-fifth the electrical energy).
    A fundamental question is ``why would we want to use valuable, high 
quality water from the Bureau of Reclamation's Shasta Reservoir in 
Northern California or Lake Powell in Utah and pump and transport it 
over 500 miles to irrigate a park or golf course in the Los Angeles or 
San Diego metropolitan areas?'' Also remember that the replacement of 
that imported water with local recycled water will save enough energy 
and reduce related greenhouse gas emissions from reduced pumping 
equivalent to a 500-megawatt power plant! Obviously the energy and 
water policy issues facing the arid West clearly justify a 
``strategically'' small grant program to use recycled water as a means 
to continue to support the economic vitality of the major metropolitan 
areas throughout the Colorado and Rio Grande River basins.
    Clearly, in an era that will be measured by what we do to deliver 
services that meet local needs in an environmentally sustainable 
manner, water recycling and reuse are an integral component of any 
response. For example, in Florida, communities are beginning to grapple 
with the impacts of a new state law that will effectively eliminate 
wastewater discharges. This means that water recycling will serve to 
support compliance with the mandate. In California, the budget crisis 
that has proven to be unrelenting places new pressures on finding cost-
effective approaches to developing water supplies. While there may be 
questions on where or how to site surface storage facilities and how to 
pay for such facilities, no debate exists on recycling and reuse 
projects. Because these are locally developed and supported projects, 
they are implemented without the acrimony that accompanies other 
approaches. This means that a safe and reliable water supply that can 
be developed for use in irrigation, recreational, ecosystem or 
groundwater recharge purposes without delay.
General Comments and Recommendations for an Enhanced Title XVI Program
    Earlier, I highlighted the significant funding Title XVI received 
under ARRA and the Fiscal Year 2009 budget. It is critical that this 
budgetary support be more than a one-time infusion of Federal support. 
For more than 10 years, WateReuse has called upon Congress to increase 
funding for this program. Today, we have a new baseline to measure this 
support. ARRA and Fiscal Year 2009 funding together provide 
approximately $175 million. This is a good start, but only a start. We 
are grateful for it. However, we have a $500 million backlog and it is 
growing every year as new projects are authorized for Title XVI 
assistance. To address the backlog, the Congress should appropriate at 
least $100 million on an annual basis for the next five years.
    This level of funding will clear the backlog of need and allow for 
an enhanced program to be developed and implemented in the intervening 
time. On this matter, I would like to turn attention to ways in which 
we could enhance the existing program and ensure that we address the 
challenges of climate change and overall drought induced water 
scarcity. These recommendations are made with an understanding that 
Congress is in the midst of developing climate change policy. We hope 
that this subcommittee and the full Committee on Natural Resources will 
work to ensure that these recommendations are incorporated into any 
final climate change legislation.
      Any climate change offset program should provide that 
public agencies that are investing in locally developed water supply 
projects are eligible to participate in the program.
      Title XVI program funding levels should be set at a level 
to eliminate program backlog within five years. This funding level 
should be $100 million per year.
      Incentives should be created to promote the use of 
recycled and reused water supplies. These incentives should include: 1) 
a 30% investment tax credit to support industrial transition to 
recycled and reused water supplies, 2) federal guidelines to procure 
recycled and reused water supplies, and 3) federal guidelines to ensure 
that green retrofits of federal buildings provide for installation of 
appropriate water recycling and reuse technology and piping.
      The Department of the Interior should provide a Report to 
Congress, on an annual basis, on its progress in promoting water 
recycling and reuse and recommendations to improve the program 
objectives in alleviating water shortages, reducing energy use and 
implementing comprehensive watershed wide solutions.
ARRA Impact on Water Recycling and Reuse
    As stated earlier, we deeply appreciate the support of projects 
through ARRA. The ability to construct long-delayed projects is an 
obvious benefit of the economic recovery assistance law. While it is 
too early to conclude whether the actual assistance will reach projects 
in a timely manner and consistent with ARRA's deadlines, the 
indications are promising. The Secretary's confirmation of the funding 
level gives us hope that actual funding will soon flow to project 
sponsors.
    ARRA's impact can be seen on a broader perspective. Congress and 
the Administration agreed that water recycling and reuse projects are 
important enough to our economy to highlight the Title XVI program as 
deserving a minimum level of ARRA funding within USBR. There can be no 
dispute from this point forward that this program is critical to the 
nation's long-term economic health. For this reason, we believe that 
ARRA has a dramatic effect on the program's importance. We have reached 
a point where consensus exists that this program can no longer be an 
after-thought. This bodes well for our shared interest in developing 
sustainable, locally developed water projects.
    On the matter of ARRA implementation, we do have a concern with the 
law's ``Buy American'' mandate. Under the law and subsequent Office of 
Management and Budget guidance, it appears that unless a project 
sponsor can certify one of three waiver conditions, a project must be 
built with American iron and steel and manufactured goods. Many of 
these projects rely on highly specialized equipment like pumps and 
membranes manufactured outside the United States. In cases where iron 
and steel and manufactured goods are available in this country, their 
availability may be limited. In the West, much of the iron and steel is 
purchased from Pacific Rim countries. Even with the ability to seek a 
waiver from the law's mandate, we are concerned that such waiver 
requests will be subject to unreasonable delays. We believe and request 
that the Subcommittee consider seeking assurances from USBR and the 
Department of the Interior that national waivers will be established to 
avoid project-by-project waiver requests. A national waiver, for 
example for membranes, would allow communities to proceed with a 
project without incurring additional project costs attributable to 
delays.
Conclusion
    Historically, the Bureau of Reclamation has always supported Title 
XVI proactively by initiating planning studies and comprehensive 
strategies to solve complex water problems in the West with recycled 
water and desalination development. Examples include:
    1.  Resolution of water conflicts in the original Newslands Project 
(first authorized Reclamation Act project in 1911), which includes 
maximum use of recycled water from Reno, Carson City and Sparks 
wastewater facilities;
    2.  Arizona v. California provided for ``return flow credits'' to 
Las Vegas for all wastewater recycled in Lake Mead;
    3.  Secretary Lujan and Commissioner Dennis Underwood initiated the 
Southern California Comprehensive Water Reclamation and Reuse Study in 
1990 in advance of Congressional authorization in Title XVI in 1992.
    Once again, the WateReuse Association wants to thank you, Madam 
Chairwoman, for convening this hearing. We would be pleased to work 
with you in addressing critical issues related to water reuse and 
recycling, desalination, and water use efficiency. We are strongly 
supportive of the Subcommittee's efforts to ensure adequate and safe 
supplies of water in the future for the entire country. I would be 
pleased to respond to any questions the Subcommittee may have.
                                 ______
                                 
    Mrs. Napolitano. Thank you, Mr. Atwater.
    We move on to Mr. Mike McDowell, General Manager for 
Heartland Consumers Power District in Madison, South Dakota. 
Welcome, sir.

   STATEMENT OF MICHAEL McDOWELL, GENERAL MANAGER, HEARTLAND 
        CONSUMERS POWER DISTRICT, MADISON, SOUTH DAKOTA

    Mr. McDowell. Thank you, Madame Chairwoman. I appreciate 
the opportunity to come before the Committee to discuss the 
important issues that are part of the stimulus package 
administered by the Bureau of Reclamation.
    A little bit about the three organizations that I am 
testifying on behalf of. Heartland Consumers Power District is 
a wholesale power supplier in South Dakota, Minnesota, and 
northwest Iowa. I am proud to tell you that as of commercial 
operation date on February 25, 20 percent of Heartland's energy 
is now generated by South Dakota's wind resources.
    The Midwest Electric Consumers Association, of which we are 
a member, is composed of 300 public power and cooperative 
organizations that purchase power from the Missouri River Dams.
    The Western States Power Corporation is represented by 
members in both the Colorado River Basin and the Missouri River 
Basin. This organization was formed 14 years ago for the 
purpose of providing advanced funding for power facilities in 
light of declining appropriations. Since that time, Western 
States has advanced about $230 million, half of which has come 
in the past three years, as we ramp up our commitments to 
rapidly aging power facilities on the Bureau and the Corps 
projects that, some of which are in dire need of repair.
    In looking at the Bureau's nearly $1 billion part of the 
stimulus package, we were disappointed to see that only $23 
million was allocated on a Bureau-wide basis for power 
facilities. I can tell you, in Pick-Sloan Western Divisional 
Loan, $10 to $15 million is needed just to keep the power 
facilities running on an annual basis, going out as far as 
anybody can see.
    Power customers have continued to increase their share of 
advance funding, to the point where now Western States members 
essentially fund all of the power replacement in the Upper 
Great Plains Region. This has been fortunate for us and our 
customers, and I think also has benefitted the Corps of 
Engineers and the Western Area Power Administration.
    Our advances in 2009 will approach $60 million. That is the 
good news. The bad news is we are reaching the limit of our 
ability to fund advance funding for Bureau projects. Cash-flow 
limits within some of our organizations, capital needs within 
some of our organizations, and investments such as Heartland 
made in South Dakota Wind Resources, coupled with soon-to-
expire Federal power contracts, make the current advance model 
very uncertain for us.
    We believe the Bureau's program offers the Nation a solid 
foundation for clean, renewable energy at a reasonable cost, 
particularly in light of the transition that is underway now to 
a less carbon-intensive energy industry.
    Madame Chairwoman, that concludes my testimony. I would be 
glad to answer questions from the Committee.
    [The prepared statement of Mr. McDowell follows:]

 Statement of Michael L. McDowell, Heartland Consumers Power District, 
     Midwest Electric Consumers Association, Western States Power 
                              Corporation

    My name is Michael McDowell. I am General Manager & CEO of 
Heartland Consumers Power District. Heartland is based in Madison South 
Dakota and provides wholesale power to 28 communities in Eastern South 
Dakota, Western Minnesota, and Northwest Iowa, as well as 6 state 
agencies in South Dakota. Thirty of our Customers hold allocations of 
Federal Hydropower from the Western Area Power Administration. 
Heartland provides power from a diverse resource base that includes 
coal, hydro, nuclear, and wind. Twenty percent of Heartland energy 
comes from South Dakota wind resources. Heartland is a member of the 
Midwest Electric Consumers Association (MECA) and the Western States 
Power Corporation (WSPC).
    I appreciate the opportunity to submit testimony regarding the 
Bureau of Reclamation's capital planning under the American Recovery 
and Reinvestment Act of 2009 (ARRA) on behalf of Heartland, MECA, and 
WSPC.
    The Mid-West Electric Consumers Association was founded in 1958 as 
the regional coalition of more than 300 consumer-owned utilities (rural 
electric cooperatives, public power districts, and municipal electric 
utilities) that purchase hydropower generated at Federal multipurpose 
projects in the Missouri River basin under the Pick-Sloan Missouri 
Basin Program. In Pick-Sloan, power generated at Bureau multipurpose 
projects is marketed by the Western Area Power Administration and is 
under long term contracts.
    The Western States Power Corporation was founded in 1995 and is 
represented by 19 members from the Missouri and Colorado River Basins. 
The organization was formed in response to declining appropriations and 
an urgent need to support the Federal power infrastructure. The members 
provide advance funding to the Bureau of Reclamation, the Corps of 
Engineers, and the Western Area Power Administration to replace 
critical equipment and provide emergency maintenance. Since its 
inception, Western States has provided over $230 million in advances, 
half of which has been in the past three years. The Bureau has received 
$13 million of these funds, and we have committed another $12 million 
to them for FY 2009. Despite our efforts, challenges remain in keeping 
their plants operating; some of these problems relate to power 
features, while others involve water delivery systems that we share as 
multipurpose facilities. We welcome the availability of funds under 
ARRA, and hope that they will be used to keep these important 
facilities viable in the future. During a time when carbon discussions 
dominate the energy landscape, we agree that it makes good sense to 
maintain carbon-free resources that currently exist, and for which the 
government is fully repaid.
    We have reviewed the Bureau of Reclamation's plans for these funds, 
and based on the information presented in the Investment Projects 
Report dated April 14th, it appears that only a small portion has been 
designated toward the actual repair and replacement of power 
infrastructure. In fact, while the magnitude of Reclamation's 
appropriation approaches $1 billion, less than $23 million is slated 
for power infrastructure on a Bureau-wide basis. In the Pick-Sloan 
Western Division alone, Bureau engineers estimate that power-related 
needs will average $10-$15 million per year for the foreseeable future. 
Under these conditions, it is unlikely that repairs and replacements 
will keep pace with critical project requirements unless power 
customers somehow fill the void. This is not to say that the proposed 
nonpower projects are unjustified; however, the power features are a 
key component of the Bureau's success and should be given equal 
consideration in the decision-making process.
    The power customers have steadily increased their participation in 
funding for the Bureau, and Western States members now fund essentially 
all of the power replacements within the Great Plains Region. This has 
been fortunate for the Bureau and our end-use consumers, but there are 
limits to what the customers can and should do for Federally-owned 
facilities. Between the needs of the Bureau, the Corps of Engineers, 
and the Western Area Power Administration, our advances approach $60 
million per year, and we have reached our practical limit for funding. 
Cash-flow limits, capital needs within our respective organizations, 
and soon-to-expire Federal power contracts make this an uncertain model 
for long-term reliability.
    Another implication of the program that has not been fully 
considered is the impact on rates and repayment. Since the ARRA funding 
is reimbursable from power customers, any new funding outside of 
regular Bureau workplans may generate unanticipated rate increases. 
This repayment applies not only to specific power features, but also to 
safety modifications and allocated shares of multipurpose improvements. 
All of these components are part of the ARRA legislation, and the 
safety modifications appear substantial. The power customers coordinate 
with the agencies on a regular basis to ``stage-in'' construction 
activities and encourage priorities that provide the greatest benefit 
for each dollar spent. This process has worked well and provides some 
measure of rate predictability over time. The impact of additional 
outlays at this point is unknown; however, the likelihood is high that 
additional items will enter the repayment stream at a time when most of 
the customers are absorbing painful rate increases due to extended 
drought.
    Unintended consequences may also occur in projects which may be 
started under ARRA, but which will require additional investment above 
the initial amounts. Based on the numbers in the Investment Report, we 
doubt whether the entire costs of some projects have been considered. 
This is the case for line items such as the Pole Hill Canal 
Refurbishment and Boysen Powerplant Rewind, both of which appear to 
have partial, short-term funding. If continued appropriations are not 
received, the projects will likely become an upfront financial 
encumbrance for the power customers or remain uncompleted.
    We believe that the Bureau's power program offers the nation a 
solid foundation for clean, renewable energy at a reasonable cost while 
providing substantial cost-sharing with multipurpose water systems 
throughout the west. To ignore the needs of the powerplants may result 
in significant disrepair and long-term outages, which will eventually 
impact all of the functions served by the Bureau.
    Thank you for the opportunity to provide written testimony to the 
Committee on these important issues. I would be happy to respond to any 
questions.
                                 ______
                                 
    Mrs. Napolitano. Thank you, Mr. McDowell. Thank you for 
your insightful testimony. And I believe Mr. Miller does not 
have questions, so we will move on to the questioning.
    Let us start it off with Mr. McDonald. The ascending 
question that your testimony did not answer, and of course it 
can be estimated, how many jobs do you think will be created? 
And how, because this is just an estimate. We are understanding 
that this is in the future.
    But beyond that is, what is the timeframe that you envision 
being able to have that money to the chosen projects? And when 
will that start? So that those jobs, whatever they may be, will 
be created?
    Mr. McDonald. Yes, ma'am. In terms of the job estimates, 
the Department of Interior has thus far been using a pretty 
simple rule-of-thumb multiplier. And we are estimating, based 
on the economic literature, that every million dollars of 
economic stimulus money for the kinds of activities reclamation 
is undertaking, will generate about 28 or 29 jobs. So that 
translates into about 26,000 to 27,000 jobs for the $945 
million that Reclamation will expend.
    As Mr. Atwater pointed out, though, a number of our 
projects and programs are cost-shared by non-Federal partners. 
So that is $26,000 or $27,000, pardon me, 26,000 or 27,000 jobs 
for $945 million Federal dollars. It will be substantially 
increased by the non-Federal dollars associated with that and 
the other programs that have cost shares that typically are 
running 75 percent, depending on the program non-Federal money. 
So quite a bit more than the 26, 27,000 jobs.
    Relative to how quickly we will do it, it will, obligations 
will be made over the period of the next 18 months to meet the 
statutory deadline, of course. We will move as quickly as we 
can on all fronts.
    OMB actually apportioned the money the day after the 
Secretary's announcement of our final decisions. We have 
already loaded our financial system in the manner that we have 
to put everything in, with the requirements that we identify, 
stimulus money separate from regular annual appropriations. 
That all got done last week.
    I will be putting out a memorandum this week that 
authorizes the regional offices to proceed on anything that has 
been approved already, if we have all the process questions 
answered. And in that regard, the gentleman speaking for the 
tribes noted that there are some outstanding questions about 
638 contracts, financial assistance, exactly how Davis-Bacon 
applies. We are awaiting guidance from the Office of Management 
and Budget on that front.
    But the Department is working very hard and very closely 
with OMB to resolve those questions quickly.
    Mrs. Napolitano. Have you set any timeframe for OMB to 
reply?
    Mr. McDonald. I don't generally set timeframes for OMB.
    Mrs. Napolitano. They do. Well, if there is any way that we 
can possibly make an inquiry to OMB, as you well know, I have 
no problem. Because this is a serious matter, and I am sure 
there are other constraints that they have. However, this is 
urgent, also.
    Mr. McDonald. And I can assure you, OMB understands there 
are a number of working groups that have identified all the 
questions, and are working through them as rapidly as possible.
    Mrs. Napolitano. Also, Mr. McDonald, there are certain 
projects under the Environmental and Ecosystem Restoration that 
also qualify under the meeting future water supply needs 
category.
    Regarding all these projects, and in particular the Red 
Bluff fish screens, how much of this funding directly or 
indirectly supports supply reliability?
    Mr. McDonald. Generally speaking, with a couple or three 
exceptions, I would say all the projects could also be called 
water supply projects, in the sense that what we are doing with 
those projects is, for the most part, meeting the requirements 
of biological opinions that are in hand, which if we do not 
meet could result in reductions of project water supply, or 
biological opinions in the case of Red Bluff, that is six weeks 
away. And we know full well what that biological opinion will 
say. And litigation in the past associated with those 
biological opinions that has brought us into compliance.
    Red Bluff in particular is a classic example of the kind of 
contemporary issue that Reclamation confronts. If we don't 
solve that problem by 2012, given the biological opinion I 
expect to receive on June 2, we risk losing the water supply 
for 150,000 acres of high-value crops. Another calamity. That 
is about as much 100-percent water supply as I can imagine.
    So while labeled ecosystem restoration, and every one of 
them is contributing to a restoration of habitat and ecosystem 
conditions, they are all there for the purpose of protecting 
already-existing project benefits and the water supply 
associated with those projects.
    Mrs. Napolitano. Thank you, Mr. McDonald. One of the things 
that I was talking to my staff yesterday in regard to the issue 
of the pumps, the Red Bluff fish screens are supposed to be 
helping the issue in northern California.
    Concern continues to be if the users above that area have--
is there a way that we can determine that they have taken steps 
to not dump as much of their toxins? Have they not used a lot 
of the fertilizers that are toxic to the fish? The fertilizers, 
some of the users that continually use the river to dispose of 
water, used water, that at one point we are talking about more 
affecting the fish, aside from the change in the water, the 
pumps, et cetera.
    Is there a work that agencies are doing in collaboration 
with you to ensure that some of that is addressed?
    Mr. McDonald. I would be better able to give you an answer 
on the record, Madame Chairwoman. Reclamation doesn't have 
direct responsibility for the application of herbicides, 
pesticides, and fertilizers on the farm. That is the individual 
responsibility of the farmer, pursuant to state and Federal 
law.
    At the same time, though, we certainly deal with water 
quality issues. I am just not personally acquainted off the top 
of my head with what we might be doing in the Sacramento 
Valley, but we would be glad to get to back to you.
    Mrs. Napolitano. I would appreciate that, sir, because that 
is still a concern.
    And Mr. Atwater, California State Law requires that any new 
industrial or home development must have a guaranteed 20-year 
water supply. The drop from the Sierras and the Colorado River 
Basin has made it difficult to rely on that imported water.
    But how has Title XVI allowed for some of those water 
districts to find necessary water supply to allow for economic 
development in southern California?
    Mr. Atwater. Great question. And simply, not only in my 
service area, but throughout southern California, Title XVI has 
allowed builders of new communities. I will cite the example in 
the City of Chino, where Lewis Operating Company master-planned 
about four years ago about an 8,000-unit master-planned 
community, duel-plumbed with purple pipe following the model of 
Irvine Ranch from 40 years ago. And we were able to guarantee 
them a water supply.
    That area, and also a larger community in Ontario, is 
developing now with a zero impact on the Bay Delta. It is all 
being supplied by local groundwater desalinization with our 
dairy cow power project with renewable energy and recycled 
water. And that will serve about 150,000 to 200,000 people, so 
it will be self-reliant.
    Another quick answer is, Walmart, for example, in the 
planning of their new big-box stores in southern California, 
want them all to be 100-percent reuse and have a zero impact on 
the water supply. That is the type of activity that I think is 
innovative, that allows us all to work together to solve our 
water problems.
    Mrs. Napolitano. Thank you. There was an article in the 
Capitol Press on April 27, Mr. Snow directed the State 
Department of Water Resources to meet without Endangered 
Species Act rules on Delta water. State allocations might be 
reaching 35 percent this year instead of 30. That is a 5 
percent increase.
    Federal officials also gave a similar estimate, absent 
Endangered Species Act restrictions. The Central Valley 
Project's 10 percent allocations from south of the Delta 
farmers would only rise to about 15 percent again by percent 
increase.
    In other words, to quote Mr. Snow, if the Endangered 
Species Act goes away this afternoon, we still have a drought. 
Still lack of water. How much water has been lost this year due 
to drought and other factors that can be replaced with water 
reuse or conservation?
    Mr. Atwater. Again, just in context, in southern California 
our supply from the State Water Project is only 30 percent. And 
obviously we are not going to see more water supplies coming 
from the Colorado River, given the huge challenges with the 
Colorado River with the long-term drought since 2000, and a lot 
of predictions going forward the next 20, 30 years that we will 
have shortages from Denver to Albuquerque to Las Vegas to 
Tucson.
    So in southern California, our formal strategy is to 
improve our efficiency, and to reuse and develop and capture 
stormwater more effectively, et cetera.
    I just remind everybody, Governor Schwarzenegger called for 
this strategy in February 2008, a reduction by 2020 of 20 
percent of the per capital water use. There are a number of 
bills in the California Legislature that are trying to enact 
that and make that a requirement for every community. And the 
way you accomplish that is being more efficient with water, and 
reusing and recycling your local supplies. And that is 
absolutely the way all this works together to kind of structure 
the supplies, so we can accommodate all the needs throughout 
the State.
    Mrs. Napolitano. Thank you. I am of the opinion, of course, 
in my own opinion, that we don't have any new water supply. 
Mother Earth has only given us a certain amount. If we have 
used it, I mean if we abuse it, we need to clean that, we need 
to be able to recycle it and be able to use it when needed, 
where needed.
    Mr. McDowell, how could the Emergency Drought Relief Act be 
used to make up this 5 percent?
    Mr. McDowell. Pardon me. The Emergency Drought Relief Act 
provides three or four principal authorities for reclamation. 
Number one, it allows us to ourselves provide temporary--but I 
emphasize temporary, it is stated in the statute--temporary 
facilities to relieve drought problems, so we could lay plastic 
pipe, for example, to get water temporarily to a city that 
needed it. We could put in temporary pumps, we could float a 
barge in a reservoir with intakes that have been exposed.
    The only thing that we can build of a permanent nature are 
wells; they can be left in place.
    Second, it gives us the authority to provide funds to 
parties to do that themselves.
    Third, it provides us the authority to move non-project 
water through our Federally owned facilities in a very 
expeditious manner, as opposed to the standing authority, which 
we call the WARN Act of 1911 that we otherwise have to use, 
which has several limitations, the principal one of which is we 
can only move irrigation water through our Federally owned 
facilities under the WARN Act. The Drought Relief Act takes 
that constraint off, lets us move water for any purpose.
    So those are the basic features of the Drought Relief Act. 
And in the context of California, though, I would also 
emphasize that there are a couple or three features of the 
Central Valley Project Improvement Act that, although not 
labeled drought relief, provide the kinds of activities that 
can be utilized for drought relief. So we will exercise that 
authority, as well, if appropriate.
    Thank you, sir. Ms. McMorris Rodgers defers to Mr. 
Radanovich.
    Mr. Radanovich. Thank you very much. I appreciate that.
    California gets $50 million of stimulus money. And as Mr. 
Keppen had testified a little bit earlier, and you did, too, 
Mr. McDonald, the Red Bluff Diversion Project is a good example 
of a win-win because it does address a pending biological 
decision on the Delta with regard to the salmon.
    But I fail to see where any of the rest of that money is 
going to deal with the other biological opinion that has been 
in effect for a year and a half now for these Delta smelt.
    And it does concern me, because we have not been allowed to 
pump during the wet seasons in two seasons now. Last year you 
asked about 600,000 acre feet of freshwater into the ocean that 
could have been sent into the San Luis Reservoir and be held 
there to allow us to alleviate the effects of Mother Nature's 
drought, let alone the manmade drought that we are facing right 
now.
    The Two Gates Project is one simple project that could be 
installed in the Delta that allows for just the installation of 
two gates. It is temporary; keeps the Delta smelt away from the 
pumps. And I understand that it could be considered shovel-
ready if the Department of Interior, Fish and Game as well, 
made it a priority by expediting the permits.
    Can you respond to me for that, sir?
    Mr. McDonald. I certainly will try. You are, first of all, 
correct that none of the projects we selected speak to the 
immediate issue of the smelt. Relative of the Two Gates 
Project, our understanding, as recently as reviewing the 
information with the water users in the state Friday in 
Sacramento, was that it simply was not shovel-ready. We could 
not get it to the point that it could be obligated by September 
of 2010.
    What we can look at, and will look at this week, is whether 
there is any temporary fix there that can be done in a manner 
of months that would be eligible under the Drought Relief Act.
    Mr. Radanovich. And I do understand that that is, as I 
interpret the Two Gates Project, it is something that could be 
done as quickly as two months. The issue is getting, expediting 
the permits. And that is whether the agencies are willing to 
prioritize this projects to expedite the permits to allow that 
to happen.
    Mr. McDonald. I have different information, is all I can 
say, Congressman. It is considerably more complicated as a 
construction matter. I would be glad to dig into that deeper 
and get back to you on the record.
    Mr. Radanovich. If you would, I would appreciate it. As I 
understand, it is probably one of the more simple projects that 
the Bureau has ever done.
    And I want to know, has the Bureau expedited permits before 
for certain projects, to get them in a little bit faster?
    Mr. McDonald. You know, we don't grant permits ourselves. 
So in an environmental regulatory context, we are a regulated 
agency. So we accelerate in the sense that we often do 
everything we can to move more quickly in contributing staff 
time. But at the end of the day, it is Federal and state 
agencies that regulate us, and we do not control their 
schedules.
    Mr. Radanovich. But those permits by those agencies have 
been expedited before.
    Mr. McDonald. I certainly know cases where state and 
Federal agencies have given priority to a permit that we may 
need to seek, yes.
    Mr. Radanovich. Is, in your opinion, the situation in 
California warrants that extra attention, that expediting on 
your part?
    Mr. McDonald. If it would assist in the next eight or 10 
months on the drought, it is certainly worth looking into, yes.
    Mr. Radanovich. All right, thank you very much. I 
appreciate that, Madame Chairman.
    Mrs. Napolitano. You are very welcome, sir. Mr. Miller.
    Mr. Miller. I would like to just follow up where Mr. 
Radanovich was. Does it make a difference in terms of 
expediting this, whether this is a Bureau project, or whether 
this is a project of the Water District?
    Mr. McDonald. It certainly would. And one of the reasons--
    Mr. Miller. The information that I have been given now for 
several months is that this is ready to go.
    Mr. McDonald. That it is ready to go?
    Mr. Miller. Yes.
    Mr. McDonald. Mr. Miller, it makes a difference in the 
sense that up until now, everybody has considered this to be a 
project that the State Department of Water Resources had the 
lead on. We have not been doing environmental and planning work 
on it, because DWR was going to proceed with it.
    And one of the outgrowths of this meeting I referred to 
Friday is our Regional Director is getting in touch with Lester 
Snow, the Director of the Department of Water Resources, to 
clear up who needs to be on first base here.
    Mr. Miller. Because I think the testimony in an earlier 
hearing of this Committee was that this was one project that 
there seems to be a great political consensus around, which is 
unique in itself. That has got to be worth some points.
    But the other is that in fact, this project is ready to go. 
I recognize it is an experiment. We don't know whether it will 
work or not. And I think there has been a little bit of fear 
factor there that you may get sued or what-have-you. But that 
is not a reason for not going forward if the project is, as 
most of the stakeholders believe, a valuable experiment to see 
whether or not we can protect the smelt in this situation.
    So I just, I hope this isn't getting caught up in whether, 
one, we are fearful in going forward; and two, whether or not 
there is some competition about whose project this will be in 
allocating or not. Because I think if the funding is available, 
and the district is willing, the local district is willing to 
take it on, that would be, that would seem to make some sense.
    Mr. Costa. Would the gentleman yield?
    Mr. Miller. Yes.
    Mr. Costa. If the meeting that Mr. McDonald is speaking of 
on Friday is the same one--I believe I was participating in 
that meeting. And my understanding was, is that based upon your 
comments, Mr. Miller and Mr. Radanovich, Lester Snow, the 
Director of Water Resources for the State of California, does 
believe that the environmental consultation process could take 
place and could be completed by August of this year, and that 
they could begin construction.
    So I think your point is well taken in the sense that maybe 
the lead on this should be the state, working with Contra Costa 
Water Agency, who has, I think, first proposed it. Both you, 
Congressman Radanovich, and myself, and I believe others, 
support it. And maybe it is the process that has created the 
problem here. And maybe we need to, that was one of the 
suggestions I made to Mr. Glacier in our meeting on Friday was 
that he had to go and confer with the Director of Water 
Resources with Lester Snow. And maybe the state ought to take 
the lead on this so we could get through this process.
    Because it does have potential merit. It does have, as you 
noted, political support in a bipartisan fashion, which is 
unusual in California. And we ought to move on it.
    Mr. Miller. I thank the gentleman. On another question, has 
there been any instruction of looking at the screening of the 
CVP pumps on a pilot basis with stimulus money, to your 
knowledge?
    Mr. McDonald. Not that I am aware of, Mr. Miller. I would 
have to check and--
    Mr. Miller. Could you check and find out whether that is 
possible?
    Mr. McDonald. I would be glad to.
    Mr. Miller. We keep discussing this, but again, we never 
quite get around to decide whether or not it is viable or not 
viable. And it seems to me we have an opportunity now with the 
stimulus money to consider that, that that would be on the 
table, or I guess it could be taken off the table.
    Mr. McDonald. I will get back to you.
    Mr. Miller. Thank you.
    Mrs. Napolitano. Thank you. And there is a great urgency, 
so if you would also let this Chair and the Ranking Member know 
so that we are apprised, and don't have to ask the questions 
again.
    I would like to have Mr. Hastings, please.
    Mr. Hastings. Thank you, Madame Chairman. And once again, 
thank you for holding this meeting. I have just got a couple of 
questions for Commissioner McDonald.
    Bill, you mentioned what your take was, and why you didn't 
put transfer projects into the mix. It seems to me that they 
still are Federally owned, and transfer projects, maybe by 
definition because the O&M has been taken out of direct Federal 
spending, might be more cost-efficient to the Federal 
government. So if there is anything that you can do to perhaps 
change that, that would be worthwhile.
    But I want to talk specifically about a project in my 
district, and that is the Quincy Irrigation District within the 
Columbia Basin Project. They have been concerned on the West 
Canal because of a choke point. And my understanding, talking 
to them over the last several years, that this choke point came 
into being when the canal was being built, there was lack of 
funds. And so rather than building it as wide as they should 
have, they choked it down. And so as a result of a down 
project, you don't get all the water.
    I guess my question to you is, this is something that they 
have been working on for a long time because of the 
efficiencies, and the fact that we need more water in other 
parts of the district.
    Would you, I guess what is your intent to try to resolve 
this problem? Because while this is a transfer project, it is 
not an O&M issue, not an infrastructure issue; it is a design, 
rectifying a design problem initially. And so I just wonder 
what your thoughts are on that in the future.
    Mr. McDonald. Thank you, Congressman. That has been an 
issue, and some difference of opinion, frankly, between the 
District and Reclamation as to whether we have an original 
design capacity problem or not.
    We have continued to work with the District, and they have 
gone out and done a variety of field work to characterize the 
issue, and are continuing to discussions with the District to 
see what the long-term fix might be that would be appropriate.
    Mr. Hastings. OK, thank you. And I just have one other 
question for Mr. Atwater.
    You have spoken at length about working together to try to 
make sure that there is adequate water for all of California. 
Is storage something that you and your organization support?
    Mr. Atwater. Absolutely. In fact, just to summarize 
briefly, one of the things that has helped to alleviate our 
shortage in our service area, and for all the 19 million people 
in southern California, is we entered into an agreement with 
the Metropolitan Water District six years ago. And we banked 
100,000 acre feet in our adjudicated basin, and also got a 
grant through the State of California through the Prop 13 2000 
bond issue.
    And so we reduced our imported water use this year by half, 
by taking half of our water out of the storage account. And we 
are going forward next year in the drought, and the year after. 
In effect, that kind of groundwater storage which goes on in 
Kern County and Semitropic and in groundwater basins up and 
down the state is something that we--
    Mr. Hastings. And I was talking, when I talk about storage, 
I assume that all people have different interpretation. But I 
am talking about storage, its initial source, which obviously 
in California would be in the Sierra Nevadas.
    Are you in favor of more storage, looking at more areas to 
store water in the Sierra Nevadas?
    Mr. Atwater. Well, in the context of Cal Fed, we have 
evaluated a lot of different alternative storage. I will tell 
you that in the State Water Plan, groundwater storage is much 
more cost-effective than surface storage.
    So if you are interested in investing in the most cost-
effective storage, then doing the groundwater banking that we 
do in Kern County, at Semitropic, Arbor and Edison, which I was 
intimately involved in that over the last 20 years; or whether 
it is storage in Chino Basin or in Madiero Ranch, or in Santa 
Clara County. I think all those, plus looking at ways to 
operate all the surface reservoirs and augmenting projects so 
we can maximize the storage when we do have a wet year.
    Mr. Hastings. Well, I am certainly, I would be in favor of 
an all-of-the-above approach. But certainly, something very 
basic ought to be at least more storage, or you said augmented 
storage, at the source, which of course is where the snow melts 
initially.
    I would just point out in my district, Grand Coulee Dam is 
the ultimate storage, and it irrigates, authorized for a 
million acres. It irrigates slightly over 500,000 now.
    So I understand you to say, then, that you are in favor of 
more storage at the source. Is that a fair assessment of what 
you said?
    Mr. Atwater. Well, certainly every watershed has its own 
unique issues. I think it is fair to--
    Mr. Hastings. I understand. I understand that. But I am 
asking specifically more storage at the source.
    Mr. Atwater. No. In the case of the Colorado River, I would 
say after the last 30 years, I don't think anybody is proposing 
any new surface reservoirs.
    Mr. Hastings. But in other areas, say other than the 
Colorado River, you would be in favor of more storage. Is that 
a fair statement?
    Mr. Atwater. I wouldn't do that generically, because every 
watershed again has some unique characteristics and unique 
issues you have to address. And whether or not it is cost-
effective to do that, or let me say specifically in California, 
let us narrow this down. There are a lot of watersheds--
    Mr. Hastings. All right. Well, thank you very much, Mr. 
Atwater. And I know that Chairwoman Napolitano is looking over 
my shoulder, and I will resist.
    Mrs. Napolitano. Thank you, Mr. Hastings. Mr. Costa.
    Mr. Costa. Thank you very much, Madame Chairwoman.
    Mr. McDonald, as I alluded to earlier, you know, this is a 
crisis that we are facing again in the Valley. And God forbid, 
should this drought continue as the last drought, as Mr. 
Atwater noted, a fourth or a fifth year--the last drought 
lasted six years--we will be rationing water in southern 
California and the Bay area. And we will be out of water in 
parts of the San Joaquin Valley.
    Noted, with that crisis understood, the irony that the fact 
in my area, some of the hardest-working people you will ever 
meet in your life that would normally be working if there were 
water to grow food to put on America's dinner table, are now in 
food lines.
    When you came up with the $260 million, as I stated 
earlier, that I think is a good list, what was the rationale 
for $40 million?
    Mr. McDonald. We had a variety of information in front of 
us that suggested the drought relief projects that could be 
done in eight or 10 months, dealing with this year 2009, the 
list varied between roughly $35 and $50 million, as my memory 
serves me.
    So as I made a final judgment about the distributions of 
dollars, I settled on $40 million as a sum within our 
authorities, and within the constraints of the Recovery Act.
    Mr. Costa. Well, as you know, we have been working on a 
list, a number of us, since January, with the local water 
agencies. And not all of them actually were projects that 
require dollars. A lot of them require transfers and exchanges.
    And you commented earlier on your opening statement that 
transfer works were not a part of the criteria to be included. 
Why not?
    Mr. McDonald. Again, the principal reason was transferred 
works are nothing we budget for. They are an obligation of the 
water user.
    Mr. Costa. I understand that. But this is a crisis. I mean, 
in the sixth year of the drought, we created the Water Bank, 
which you folks have now worked out with a giant garter snake, 
and hopefully the state and Federal efforts on the water bank 
of the joint use point will work.
    But we transferred a million acre feet of water within 
California, just innovation, thinking out of the box, working 
hard.
    So transfer works, I think I would go back and take a look 
at--I mean, I understand this is a stimulus package. But again, 
we are smarter than this. We need to look at all the management 
tools in our toolbox.
    Mr. McDonald. I certainly understand. We may be talking 
past each other.
    Transferred work simply means a facility, the O&M of which 
is the responsibility of the water user, some of the projects 
you brought to our attention would be extraordinary maintenance 
or replacement work on a ``transferred work.''
    Mr. Costa. OK, I want to be mindful of--
    Mr. McDonald. For us was that we found none of those to be 
shovel-ready, capable of being obligated by September.
    Mr. Costa. Well, I think in our discussion on Friday, maybe 
they are going to take another look at some of these, I hope.
    Mr. McDonald. If that was Mr. Glaser's conclusion and we 
can use it under the Drought Relief funding, we will do so.
    Mr. Costa. Will there be a possibility of more funding for 
drought-related efforts, either in the stimulus package or 
somewhere else?
    Mr. McDonald. I would not expect any changes. The Secretary 
and the Department have made their decisions on the stimulus 
package. We have allocated the full amount available to us, and 
that is the road we are headed down.
    Mr. Costa. All right. Mr. Keppen, you mentioned in your 
testimony regulatory actions that could provide economic 
stimulus. Can you give us an example on such actions? I know 
you represent multiple states, but again, as Tip O'Neill is 
local and I am at ground zero.
    Mr. Keppen. Well, I will try to apply one to your 
neighborhood, Congressman Costa.
    You know, there are administrative things, legislative 
things, that could be applied to deal with some of the existing 
laws that are out there right now in a constructive way. And I 
kind of take offense sometimes when we try to advocate for 
doing that, trying to streamline the regulatory process for 
things like the National Environmental Policy Act (NEPA), the 
Native Species Act, and the Clean Water Act, we get criticized 
for trying to gut these laws.
    That is not the intent. We are trying to make them work 
better. Some of these laws are 30 years old or so.
    So in the case of the Delta smelt, for example, ESA-driven, 
Fish and Wildlife Service has basically written a biologically 
opinion that it took 300,000 acre feet of water that was being 
used last year in the San Joaquin Valley last year in one 
month, sent it out to the ocean.
    Our feeling is that if there had been proper peer review, 
if there had been an open process and the best available 
science had been brought through scientists, and they 
assessed--
    Mr. Costa. In which the biological opinion followed through 
with a biological assessment that was peer-reviewed by multiple 
agencies.
    Mr. Keppen. Right, right. I think just in that regard, 
trying to set up a really, truly sound peer review might vet 
some issues that would prevent a focus being placed on the 
pumps.
    So for example, with the Delta smelt, we and our scientists 
don't see any sort of correlation whatsoever between the 
operation of those pumps and the health, the abundance of the 
Delta smelt.
    And so, but how do we have recourse? How do we get our 
science injected into that process? We are using the 
Information Quality Act right now, as you know, to try to push 
that issue. That very issue, if there was just more of an open 
process that we think could be handled administratively or 
legislatively to prevent these sort of decisions from being 
made--
    Mr. Costa. My time has expired. I thank Madame Chairwoman, 
and I will submit some questions to our friend, Rich Atwater, 
regarding some of the stuff you and I have worked on.
    Mrs. Napolitano. Thank you, sir. We might have a second 
round pretty soon.
    Mr. Smith.
    Mr. Smith. Thank you, Madame Chairwoman. Commissioner 
McDonald and Mr. Keppen, there have been concerns that the 
Bureau has not partnered with the private sector and 
contractors. And many of the water users believe that this 
could, the partnering could save money and time.
    How much of the stimulus activity will be, do you think 
would be channeled to the partnerships as a reclamation, and to 
use these partnerships in the future? Mr. McDonald.
    Mr. McDonald. Mr. Congressman, our estimate is that 90 
percent to 95 percent of the stimulus dollars we are receiving 
will go into the private sector for work to be done by the 
private sector. Or, put conversely, we would expect only 5 
percent to 10 percent, and I think it will be more around 5 
percent, 6 percent of the dollars will be spent on actual 
Reclamation employees for construction management, for 
construction contracts with the private sector, processing of 
financial agreements, that kind of thing. And a portion of that 
will go to, we would guess, 20 to 30 people that we will hire 
on a two- or two-and-a-half-year temporary basis to process the 
extra workload brought on by the stimulus package.
    Mr. Smith. OK. Mr. Keppen?
    Mr. Keppen. Yes, it will be interesting to see, I guess, 
how this all comes together.
    I would just say that this whole process gives us a great 
opportunity to try to exercise some of the things that we 
developed in the Managing for Excellence Program, which was a 
program that we advocated strongly that irrigation districts, 
if they were given the ability to maybe use some of their 
personnel and their consultants on some of these projects, they 
could be done perhaps quicker, definitely help Reclamation out, 
be done quicker, and perhaps less expensively. And we have 
actually got case studies that demonstrate that that is the 
case in the past.
    So, you know, we are willing to work with the Bureau of 
Reclamation on this. And again, it is very consistent with what 
they have been talking about in recent forums that they have 
set up to try to restructure their organization on these sort 
of things.
    Mr. Smith. OK, thank you. And Mr. Keppen, Reclamation has 
modified the criteria for challenge grant programs by raising 
the minimum dollar amount from $300,000 to $1 million. What do 
you believe the practical impact will be for the Family Farm 
Alliance members?
    Mr. Keppen. Well, as I had mentioned in my testimony, the 
range is now $1 million to $5 million. Having that higher $5 
million limit allows some of these bigger projects to be taken 
care of quickly.
    But, on the other hand, projects that used to be able to be 
funded between $300,000 and a million, many of those projects, 
what we are going to see is less larger projects, and we are 
going to lose the ability to have perhaps several small 
projects that would help rural communities throughout the West 
because of this cap. That is basically the practical 
application of this.
    We are going to I think see less spreading of the wealth 
throughout the West.
    Mr. McDonald. Madame Chairwoman, could I offer a point of 
clarification?
    Mrs. Napolitano. Yes.
    Mr. McDonald. Mr. Keppen is exactly right about the new 
caps that will be used for the Recovery Act monies. The point 
of clarification is those new caps apply only on a one-time 
basis to the Recovery Act funding of $45 million.
    The annual appropriations are still subject to the program 
as it has existed, where the maximum is 50 percent, or 
$300,000.
    So we can accommodate the small projects, or the big ones. 
We decided to use the Recovery Act to get at some big projects 
that we can't get at through annual appropriations.
    Mrs. Napolitano. Thank you, sir. Mr. Smith?
    Mr. Smith. Thank you, I yield back.
    Mrs. Napolitano. Thank you, Mr. Smith. And we now have Mr. 
Baca.
    Mr. Baca. Thank you, Madame Chair. Mr. William McDonald, I 
have seven questions that I would like to ask you, and I know 
that I am going to go ahead and ask all seven now. I know you 
are not going to remember all seven, but for the record, 
hopefully you will be able to submit them later. Otherwise I am 
not going to get in my questions at this point.
    Mrs. Napolitano. Start talking.
    Mr. Baca. So I am going to start by the beginning. Why is 
there a delay in the financial section of the Emergency Drought 
Relief Project when the Governor of California declared an 
emergency on February 27, 2009? As we know in California, we 
have an emergency, and farmers are losing their crops.
    We know, pay now, pay later, which means that if farmers in 
America lose their crops, that means we are going to lose to 
foreign, foreign farmers who will actually have their crops on 
sales for our consumers. So it impacts our consumers in the 
area.
    And why is there a delay in the $40 million for emergency 
drought relief? I just don't understand this. This is an 
emergency. And second, the Drought Water Banks released the 
environmental assessment finding of no significant impact on 
April 22, 2009, when the state was able to purchase the water.
    Question No. 2. In regards to the green building and 
funding, the written testimony on the $13.5 million is omitted. 
Can you explain how the funding will be distributed? What are 
your priorities for the green building funding? Will this 
funding comply with the Davis-Bacon requirement?
    Question No. 3. In your written statement, you shared that 
$5 million will be shared for management and oversight. Can you 
explain how the funding will be used and prioritized? And how 
will this funding be used for the recovery investment?
    Question No. 4. When do you hope to announce the selection 
of individual projects for Title XVI projects?
    Question 5. Of the $164.5 million set aside for the 
infrastructure reliability and safety improvement, actually how 
much will be allocated to the Folsom Dam in California, and the 
Colorado Big Thompson Project?
    Question No. 6. When will you announce the $135 million 
worth of water recycling projects, and why is there is a delay?
    Question No. 7. Of the $266 million that will be used for 
various projects widely distributed throughout western states, 
can you provide an example of projects that you are 
considering? When will you make these decisions? And I will 
repeat any of these questions over again, but I got all seven 
in. And you may begin now.
    Mr. McDonald. And I am to get them all in, too. OK.
    Relative to the first one, a delay, as you put it, in 
selecting drought research projects, we certainly understand 
the urgency. What I would say is I had frankly started down the 
path of making project selections up until the very last 
minute. And in the last couple of days, I decided that I really 
did not know enough to make an intelligent decision.
    So we went to a lump sum of $40 million so that we would 
have the opportunity to meet particularly with California water 
users, but there are a couple other areas that seek input, as 
well, and get their input before we made decisions. So that is 
why we didn't come to individual project selections in advance.
    With respect to the green building category, that is a 
single building in Boulder City for our lower Colorado region, 
Boulder City being the office building for our lower Colorado 
region. It is a leed-compliant, L-E-E-D, energy-efficient 
building, and from our perspective, part of infrastructure. You 
have to have warehouses, equipment yards, office buildings to 
put computers; control systems for dams, and in a way as a 
piece of infrastructure. It is a single building, and that is 
the only thing in that category.
    Your third question, if I caught it, was what goes to 
management and oversight. The Recovery Act specifically 
provides in Title IV that one half of 1 percent of the monies 
appropriated is to be used for management and oversight. We 
will devote those monies principally to activities associated 
with the extra reporting that is being required by the Act and 
by the White House, internal reviews and audits that are 
required to achieve the degree of accountability and 
transparency that is being required.
    And third, working with the Inspector General, who, as you 
well know, has substantially expanded his or her staff, as the 
case may be, to do extra audits above and beyond the normal 
annual process. So that is what that money will be devoted to.
    With respect to your question no. 4 on Title XVI projects, 
which help me, Congressman, I understood to be the same 
question as in your question no. 6. So let me answer what I 
think the question was.
    When will we announce the selection of Title XVI projects? 
That announcement will be made in May, and that will disburse 
the $135 million that is to be devoted to Title XVI projects.
    Your fifth question, how much money for Folsom, we are 
accelerating the dam safety work at Folsom, which is already 
underway. And the amount of that money is $22.3 million, set 
out in the one-page tabular summary to my written testimony.
    And I must confess, I missed your last question.
    Mr. Baca. I know that the time has expired. But of the $266 
million that will be used for various projects widely 
distributed throughout the western states, can you provide 
examples of projects that you are considering, and when will 
you make a decision?
    The reason I asked all seven questions, you notice I got a 
little bit more time this way.
    Mr. McDonald. May I follow up on the record, sir? We will 
take care of that.
    Mrs. Napolitano. Thank you very much. And that was a sneaky 
way, Mr. Baca, but it worked.
    I would like to ask Mr. McClintock.
    Mr. McClintock. Thank you, Madame Chairman. When we speak 
of the drought in California, I have heard such words as 
catastrophic and horrendous used. It seems to me that is based 
on somewhat old information. Almost the day that the Governor 
declared a drought emergency it began raining, and it has 
rained and rained and rained in northern California to the 
point where Shasta and Orville Lakes are now filled to three 
quarters of normal, at 59 percent and 66 percent capacity, 
respectively.
    When we met a few weeks ago to talk about the dire 
conditions in the Central Valley, I had just come back from 
Folsom Lake, which at the time was at about 70 percent of 
capacity. That is now at 80 percent, which is considered full.
    The Fresno Bee published a piece on April 2, and I will 
quote a bit from it. It says, ``Snow surveys this week confirm 
that California's drought is three years old, but it is not 
among the state's five worst dry spells on record. At 85 
percent of average on April 1, the snowpack is bigger today 
than in any season during the 1987 to 1992 drought, when West 
San Joaquin farmers at least got some irrigation water.''
    The same article goes on with the following quote: ``If we 
had the exact same year as the early 1990s, before we had the 
regulatory restrictions, we could have moved 300,000 acre feet 
into reservoirs, said Tom Boardman, Water Resources Engineer 
with the San Luis and Delta Mendota Water Authority.''
    Now, my question is this. We have been talking a lot about 
the projects authorized in H.R. 1, a few of which are going to 
be granting any kind of conceivable immediate relief to the 41 
percent unemployment, for example, that we just heard about in 
Congressman Costa's district.
    We moved H.R. 1 in about 12 hours. Presumably, we could 
move regulatory relief in the same period, which would grant 
immediate instant relief to a large extent throughout the 
entire region.
    So the question I have of any of the panelists, for that 
matter anyone at the dais, is what are we doing in that regard?
    Mr. McDonald. Relative to a Reclamation perspective, 
Congressman, I can only report the obvious. Congress did not 
relieve any of the Federal agencies of the regulatory 
requirements of the law: environmental, work-related, safety-
related, whatever they may be.
    So we will certainly expedite every process we can. We are 
talking to the regulatory agencies we have to deal with. They 
understand they need to buck it up as well, and move things 
along as rapidly as they can. But we are left subject to the 
existing law.
    Mr. Keppen. Congressman, I will add to that. You know, 
there is an effort underway right now with the White House 
Environmental Quality. I understand they are looking at NEPA 
acting on language that was included in the overall stimulus 
package asking the agencies to find whatever ways possible to 
move through the NEPA process as quickly as possible using the 
existing law.
    And that is encouraging. I am hoping that that process can 
identify where that can happen relative to stimulus funding. 
But it shouldn't just stop there. I mean, I think part of the 
problems we are having in California is we haven't been able to 
build an infrastructure for decades, in part because of the 
regulatory morass that is out there.
    So that is one encouraging light. I am hoping that, you 
now, we will get some findings out of there that will 
streamline NEPA, and then keep that momentum going to look to, 
you know, applying that to developing new infrastructure as we 
move forward to challenge, to deal with the challenges here in 
the next decade.
    Mr. McClintock. Well, let me ask the Bureau of Reclamation. 
Taking Mr. Boardman at his word that the regulatory relief 
would immediately produce 300,000 more are feet into our 
reservoirs.
    Is there anything in this package in the next three months 
that would produce that kind of additional yield in the 
California water system?
    Mr. McDonald. No, there is not.
    Mr. McClintock. Thank you.
    Mr. Atwater. If I may, I would just suggest that the $135 
million for Title XVI would develop in excess of 300,000 acre 
feet in California. The State Water Plan calls for a million 
acre feet.
    Mr. McClintock. In the next three months?
    Mr. Atwater. Not in three months, but over the next 24 
months of design and construction. Going back to your earlier 
question on H.R. 1, we are in design on expanding the Chino 
groundwater desalters that serve riverside in San Bernardino 
County. And that was first introduced--
    Mr. McClintock. But since this is my time, let me point out 
the regulatory relief would be both instant, and would cost 
nothing.
    Mr. Atwater. That is true. I am just talking about what we 
can accomplish in the next two years with the funding that the 
Bureau was granted of a billion dollars to have shovel-ready 
projects.
    There are some immediate returns on investment that affect 
the water supply throughout California and throughout the West. 
And I would suggest those have both short-term significant 
benefits, but also return every year for the next 50 years, 
too.
    Mrs. Napolitano. Thank you. In that light, though, Mr. 
McDonald, does the Agency recognize CEQA as being more 
stringent than NEPA?
    Mr. McDonald. I don't personally have enough experience 
with CEQA to comment on that, Madame Chairwoman. I would have 
to talk to the experts in our regional office.
    Mrs. Napolitano. Mr. Atwater, do you think that would prove 
helpful?
    Mr. Atwater. Well, two years ago the Bureau of Reclamation 
adopted updated directives and standards related to Title XVI. 
The Senate had two hearings on it. Senator Feinstein really 
championed that effort to streamline NEPA and CEQA.
    And the finding is that, in basically working with the 
Bureau of Reclamation of California, if you comply with the 
California regulatory requirements, you fully comply with NEPA. 
And in fact, that whole effort is generally very streamlined, 
and we coordinate those efforts very effectively.
    Mrs. Napolitano. Would there be a time saving in being able 
to utilize, if they were authorized?
    Mr. Atwater. Absolutely. And I think one of the questions 
you might want to entertain is Chairwoman of the Council of 
Environmental Quality, Nancy Sutley, of course was a member of 
the State Water Board; was very active in looking at these 
issues. Also when she was Deputy Mayor of LA, in trying to 
streamline those processes so that we could, if you will, fast 
track in a regulatory fashion projects that are ready to go.
    Mrs. Napolitano. Mr. McDonald, I would certainly like you 
to comment on that.
    Mr. McDonald. Well, what I could add to that is we 
certainly dual-track CEQA and NEPA all the time. That is not 
out of the ordinary.
    What I was unable to respond to was whether CEQA was more 
stringent. I just don't know. Certainly I do understand, and I 
agree with Mr. Atwater, if you comply with CEQA, you have 
complied with NEPA.
    Mrs. Napolitano. So would the Bureau, then, if there is a 
CEQA approval, would you then not have to require the NEPA 
approval?
    Mr. McDonald. We simply do a joint document. It is routine; 
it has been done all the time.
    Mrs. Napolitano. Mr. Salazar.
    Mr. Salazar. Well, thank you, Madame Chair. Thank you for 
allowing me to sit in on your Committee. Mr. McDonald, how are 
you?
    Mr. McDonald. I am fine, how are you?
    Mr. Salazar. Are you taking care of my little brother?
    Mr. McDonald. Other way around.
    [Laughter.]
    Mr. Salazar. Well, first of all, let me just thank you for 
the funding that we got for the Animas-La Plata Project in 
Durango, Colorado, through the Recovery Act. We do appreciate 
that very, very much.
    I have a question for you. Since the Recovery Act funded 
mostly, you know, projects that were already in process or 
shovel-ready projects, one example that really didn't get 
funded was the Arkansas Valley Conduit. This was authorized in 
1962, under President Kennedy's signature. It is long gone 
since these lower Arkansas communities don't have clean 
drinking water, basically.
    Would you consider maybe putting it in the Administration's 
budget for the coming years, if possible?
    Mr. McDonald. We certainly understand the interest in the 
project, and it is one of those that is being evaluated as part 
of the out-year budget process. Obviously can't comment on 
behalf of the Administration whether it will be in 2010 or 
thereafter.
    Mr. Salazar. OK. Well, we do appreciate that. As one of the 
issues in question, of course, had been over the past several 
years, was the cost share. And I think that the lower Arkansas 
communities and other players have actually worked out the 
funding process to where it can actually be afforded.
    One other issue briefly was the City of Aurora has actually 
entered into a 40-year agreement with the Bureau of Reclamation 
on using excess-capacity contracts in Lake Pueblo. Do you think 
that is legal? Do you think that is, do you think that was 
intended under the Fry-Arkansas Proposal in 1962?
    Mr. McDonald. Reclamation does believe we have that 
authority. That is why we entered into the contract. It is in 
litigation, of course. Lower Ark Valley disagrees with us.
    What I can report, though, is just within the last 10 days 
we have reached an agreement with the City of Aurora, the Lower 
Ark Valley, and Reclamation. And it stipulated to the Judge 
that we would support a stay of the litigation proceedings to 
give Aurora and Lower Ark the opportunity to move the 
legislation that they are proposing.
    Mr. Salazar. OK. Thank you very much. I appreciate your 
comments.
    And I also want to thank Mr. Coffman for being, I think, 
the only Coloradan on this Committee. We sure have a lot of 
Californians, so thank you for taking Colorado's water.
    Mrs. Napolitano. That is all right. We have your little 
brother to help.
    I am sorry, Ms. McMorris Rodgers, I have skipped you over 
and over again. I would like to have you next please, ma'am.
    Mrs. McMorris Rodgers. Thank you, Madame Chairwoman. I 
wanted to ask Mr. McDonald. You threw out the estimates as to 
how many jobs you think will be created with these stimulus 
dollars.
    I was wondering, is there going to be an actual accounting 
of how many jobs are created at some point?
    Mr. McDonald. My understanding, but I don't have direct 
information, ma'am, is that the Office of Management and Budget 
will make more refined estimates as the Federal government 
moves through the process.
    In terms of Reclamation doing it itself, our initial cut is 
it would be very difficult to do so. A lot of this money will 
be financial assistance to other entities, such as Title XVI 
projects that Mr. Atwater spoke to. We will pass that money 
along, but we won't be the ones procuring contracts, so we 
won't even have direct information.
    So, so far, unless I receive guidance to the contrary, I 
would not expect Reclamation to individually try to gather up 
the information as to how many jobs actually get created.
    Mrs. McMorris Rodgers. I guess that concerns me a little 
bit. We have had a lot of numbers thrown out this morning, and 
we are talking.
    You said there was an estimate for every million dollars, 
there would be 28 to 29 jobs created.
    Mr. McDonald. Yes, ma'am.
    Mrs. McMorris Rodgers. You know, that is 33,000 jobs. And 
then we have also heard $5 million in administration for 20 to 
30 jobs. That would be $170,000 jobs.
    Mr. McDonald. No.
    Mrs. McMorris Rodgers. I am just trying to get my arms 
around how these estimates are actually going to play out.
    And it just seems like, in this process, it is very 
dangerous to just throw out estimates that I would like to see, 
at some point that I would think when contracts are being 
awarded, and all the reporting that has to be given back to the 
Agency, that there would be, it would be possible to actually 
track how many jobs.
    Mr. Ron His Horse Is Thunder has stated that there are no 
rules on reporting requirements right now. And I was going to 
ask him, too, because he said, you know, a significant portion 
of the funding that he gets is in reporting. We were talking 
about the money that is spent in, you know, more money that 
could actually be put in projects through regulatory relief.
    And I am just trying to get my arms around, I guess I am 
concerned about estimates as to actually how many jobs are 
going to be created.
    Mr. McDonald. OK. A couple of comments. Let me clarify, I 
didn't mean to cause confusion.
    First of all, I was trying to say two different things 
earlier, that out of the $145 million, we estimate that 5 
percent to 10 percent at most, and closer to 5 percent, 6 
percent, 7 percent is the only part of that $945 million that 
will be spent on Reclamation's own staff. The balance will go 
out to the private sector.
    Within that Reclamation staff, there will be some temporary 
hires. I think that is the point I was trying to make. We 
estimate clearly we will probably hire 20 to 30 new people on 
two- to two-and-a-half-year term appointments, or reemploy 
retired people that we can bring back and dismiss at will, if 
you will. They don't have any retirement rights the second time 
through.
    The one-half percent for management and oversight, which 
obviously will be spent on Reclamation employees, is a separate 
chunk of money from that 945. And that will go to the extra 
efforts, Reclamation staff of working with the Inspector 
General, the extra audits required by the process, so on and so 
forth.
    You know, in terms of your interest about estimates, 
absolutely, we are working with an estimate, a pretty simple 
multiplier at this point. It is what the Department has been 
using, and that is what we await further guidance from the 
Office of Management and Budget about, how far they want to 
take the process in terms of either much more refined 
estimates, or trying to get an actual handle on data as we move 
money into the private sector.
    Mrs. McMorris Rodgers. I would like to ask Mr. Ron His 
Horse Is Thunder if you could give us any more details as to 
what portion, what portion of the funding you receive, if you 
could put a percentage on it in general, as toward reporting of 
the money that you get from Reclamation.
    Mr. His Horse is Thunder. I can't provide an accurate 
number on that, as well. So I would have to talk to my 
financial staff and program staff as well, to give you an idea 
on that.
    But I do know this is that normally we don't get 100 
percent of the contract support costs given to us in the first 
place. And I say that knowing that your question is how much is 
going to contract supports, really. But generally, we don't get 
100 percent of the contract support costs given the tribes, I 
do know that.
    Mrs. McMorris Rodgers. OK, OK. Let us see, I wanted to ask 
a question of Mr. McDowell. I will get on a different subject 
now.
    You testified that only $23 million will go toward 
refurbishing the hydropower facilities Bureau-wide. Does 
enhanced hydropower generate revenue to the Federal government?
    Mr. McDowell. Yes, it does.
    Mrs. McMorris Rodgers. Do you have an opinion as to why the 
Bureau has allotted so little money to basic rehab of power 
plants?
    Mr. McDowell. The spending decisions indicate to us that 
power is a low priority at the Bureau these days.
    Mrs. McMorris Rodgers. Are the units in good shape? Or is 
the work already underway to a degree that there are no 
significant concerns?
    Mr. McDowell. We have significant concerns with a number of 
the units. I would be glad to submit a list to the Committee if 
you so choose. We have two in Colorado: the Mount Elmer Project 
and the Flatiron Unit No. 2, both of which I can only describe 
as being on life support. And they are in advanced states of 
disrepair.
    Mrs. McMorris Rodgers. OK, OK. Thank you very much, Madame 
Chairwoman. I yield back.
    Mrs. Napolitano. Thank you, Mr. McDowell. I look forward to 
talking to you in the future in regard to the grid, since that 
also is an issue with the Subcommittee.
    Mr. McDonald. Madame Chairwoman?
    Mrs. Napolitano. Yes?
    Mr. McDonald. I would like to clarify a part of that, if I 
could, please.
    Mrs. Napolitano. Please.
    Mr. McDonald. I certainly understand the interest in power, 
and I don't dispute that the power, a lot of our power 
facilities are aging infrastructure.
    The principal reason you don't see much power is that 
Congress has enacted a variety of special funding arrangements 
by which we take care of our power maintenance off-budget. We 
do not even come to Congress for appropriations. That is how 
the Lower Colorado system is operated, Hoover Parker Davis. 
That is how the Colorado River Storage Project is operated. 
That is how we operate the system in the Pacific Northwest, the 
Federal Columbia River Power System.
    So we already have mechanisms in place. It didn't take a 
stimulus package to make sure that we have direct funding in 
accordance with a whole range of cooperative agreements, in 
which we work with the power customers to identify the 
extraordinary maintenance and replacement that we need to take 
care of.
    Mrs. Napolitano. Right. But obviously, there is a lack in 
infrastructure assistance. And I think that is what they are 
referring to, is whether or not you have enough budget to be 
able to do it, or the manpower to be able to get it done.
    Mr. McDonald. The principal issues in the Great Plains 
Region, where Mr. McDowell is from, what I can comment is the 
Flatiron Penn stock is on our list for Recovery Act funding, 
because of the timing that we will take down the Unit No. 2 
that he speaks to, that is in our future budgets to take care 
of, so that we are coordinating the work of the two.
    Mrs. Napolitano. Thank you, Mr. McDonald. I was just going 
to ask Mr. McDowell if you wouldn't mind to comment on what you 
just heard.
    Mr. McDowell. I think the power customers in the Upper 
Great Plains are, at this point, doing all that they can do to 
provide advance funding for Bureau projects that are, quite 
frankly, in advanced states of disrepair. And again, spending 
decisions are reflective of the priority that power has, within 
the Bureau and from where we sit, it does not have a very high 
priority.
    We have megawatt hours that could be produced that do not 
have carbon footprints that are not being produced because the 
facilities are in advanced states of disrepair.
    Mrs. Napolitano. Thank you, sir. And I have Mr. Coffman 
coming up. I am sorry, Mr. Coffman, but this brings another 
question to my mind in regard to this.
    Since WAPA just got borrowing authority, and Bonneville 
just got extension of their authority, currently customers are 
helping WAPA, am I correct?
    Mr. McDowell. That is correct.
    Mrs. Napolitano. But they do get their power rates reduced.
    Mr. McDowell. No, the power rates are not reduced. The 
advances are returned to us in the form of credits on our power 
bills.
    Mrs. Napolitano. Credit on--
    Mr. McDowell. But the rates stay the same.
    Mrs. Napolitano. Thank you.
    Mr. Coffman. Thank you, Madame Chairman. Mr. McDonald, to 
follow up on a Colorado-specific question.
    For the record, could you expand on why you think the 
contract between Aurora, Colorado and the Bureau to lease water 
for 40 years is legal?
    Mr. McDonald. Mr. Congressman, with all due respect, since 
that is a matter in litigation, I would need to consult with 
our attorneys to determine an appropriate response on the 
record.
    Mr. Coffman. Thank you, Mr. McDonald. I would appreciate it 
if you could do that.
    Second, Commissioner, why did the Department not include 
funding for the Arkansas Valley Conduit in Colorado? And what 
do you see as prospects for future funding?
    Mr. McDonald. It was considered, but not included, because 
it is essentially it is not project-ready--shovel-ready, pardon 
me. At the best, it is at the stage where you could do some 
surveying of the potential alignment of the pipeline-associated 
soil-sampling drilling along the pipeline, but nothing anywhere 
close approaching ready for construction.
    Relative to its place in future budgets, that will depend 
on the parties of the Administration as we move into 2010, 
2011, and beyond.
    Mr. Coffman. Commissioner, is it likely the conduit will 
see funding in the upcoming 2010 administrative budget? You 
have answered certainly a part of that.
    Mr. McDonald. The President's budget will be released on 
May 6, and that will answer the question.
    Mr. Coffman. Thank you, Madame Chairman. I yield back the 
balance of my time.
    Mrs. Napolitano. Thank you. You are a pleasure to have, 
sir.
    [Laughter.]
    Mrs. Napolitano. Mr. McDonald, if we do not mitigate the 
environmental impacts of the dams, does Reclamation have to go 
to Stillwater? And if so, what impact does that have on our 
power generation?
    Mr. McDonald. Difficult to answer very concretely, Madame 
Chairwoman, in the broad context of that question. It is highly 
site-specific, depends on the system; but there certainly are 
instances in some of our systems where fish passage issues and 
fish habitat issues downstream of a hydropower facility have 
prompted either Reclamation or the Corps of Engineers to spill 
water that has historically been run through the turbines.
    Mrs. Napolitano. Thank you, sir. I would like to go on in a 
different vein, because I am very concerned, as I have been in 
other hearings, with our inability to assist the tribal needs 
of water. So I am asking Mr. McDonald if hearing the Chief's 
statement, and the fact that in some areas they still do not 
have potable drinking water, what efforts--and this is 10 years 
they are talking about having a drought and no drinking water. 
And I can remember not too long ago that in this Subcommittee, 
the Navajo Nation brought in children's description of how 
water is brought to them. And they had drawn a picture of a 
water truck.
    In this day and age, in this great country of ours, that 
this still exists is unfortunate. And it is unacceptable.
    So what can we do to be able to promote--and I would say to 
the Chief that the Representatives need to be able to put bills 
so that they can be considered. But what can you do to be able 
to assist us in getting some of those areas that have been 
neglected for decades?
    Mr. McDonald. Madame Chairwoman, in the context of the 
Recovery Act, we have allocated money to a number of projects 
that will assist native community, Native American tribes and 
communities. The limitation, of course, was we could only do 
what is authorized.
    So what the gentleman refers to are a number of activities 
that I would take it are desirable to do, but not things that 
Reclamation has been authorized to do. We are allocating money 
to all six projects that are authorized in the Dakotas and 
Montana for rural water supply. Those are the only six 
authorized projects. We do not have authority at this point to 
go elsewhere, other than through the new Rural Water Program 
that is in its formative stages, and was not ready for Recovery 
Act funding.
    And then several projects, the Animas-La Plata Project, the 
Gila River Indian Community, the San Carlos Irrigation District 
are all projects that will move water toward Native American 
community needs.
    That said, there is a substantial additional need out 
there, and the rural water program will be the means by which 
we attempt to address it. It will for Congress, however, be a 
huge budget issue.
    Mrs. Napolitano. Understood. But still, I believe it would 
be advisable, if you will, that we start looking at how we can 
identify those areas that have been long ignored, and begin to 
help them either draft legislation and have their members be 
cognizant of the needs, and be able to at least have them in 
the queue. Knowing that there is, what, 500 million-plus of 
approved water projects that have been through the review 
process here in Congress. We only have, what, 180 million 
roughly, give or take, to work with.
    So those are things that possibly in the future that we 
would like to discuss with you, sir, and with the tribes.
    Mr. McDonald. Very good.
    Mrs. Napolitano. The question on to Mr. Larsen. Will the 
USGS lose valuable streamflow or groundwater information by 
removing the streamgages and wells? And can those, I believe it 
was a large figure, 1200 be converted, recycled, if you will, 
talk about recycle, to be used in areas. Specifically one area 
that was brought to my attention not too long ago was Ohio, is 
can they be refurbished and reused somewhere else?
    Mr. Larsen. We currently have about 2,000 sites in our 
deferred database. These are either abandoned streamgages or 
wells, or cable weights to measure streamflow in large rivers.
    The 1200 that we planned to mitigate with the stimulus 
funding are those that have the least likelihood of reuse or 
reactivation. We work closely with our partners in every state, 
and I will certainly look into your question about Ohio, to 
make sure that any sites that we will mitigate are those that 
the state and our other local partners, as well as the Federal 
agencies involved, have zero interest, or little or no interest 
in restarting.
    Nonetheless, it is an important challenge that you raise, 
that of sustaining our network of 7,500 gauges. And it is done 
with the support of 850 state and local partners. So depending 
on their priorities, we make the decisions at the local basis.
    Mrs. Napolitano. My light doesn't come on, so I don't know 
whether I am on or off.
    But is it feasible to reconvert these, to recycle these 
streamgages that you are going to be discontinuing and pulling 
aside?
    Mr. Larsen. Some of those stations potentially could. And 
there are 800 that will not be, out of the 2,000 that are 
abandoned, that will not be mitigated. And among those 800 
there are some that are possibly viable sites for restarting.
    The big problem is that it costs us about $15,000 per year 
to operate each site. So without a long-term funding source, 
either through Federal appropriations or through a local 
partner, we are unable to, with the stimulus funding, to 
restart stations.
    Mrs. Napolitano. Well, I look forward to visiting and 
really looking at a streamgage to understand what I am talking 
about.
    Mr. Larsen. It would be our pleasure.
    Mrs. Napolitano. Thank you. Chief His Horse Is Thunder, how 
will the ARRA funding help expedite your drinking water 
project?
    Mr. His Horse is Thunder. Five years ago we ran our water, 
and one of our major communities, due to the drought, and the 
drawing down of Lake Oahe, and our water intake was inundated 
with silt. And since then we have had a temporary intake 
built--it cost about $5 million--in that community.
    And about two years ago, with the drought still occurring, 
the other major water intake supply for the reservation was 
about two feet from coming out of the water.
    And so we have, with Bureau funding we have sunk a new 
well. Not a new well, but a new intake into the river further 
downstream, which should supply us water no matter what the 
drought conditions.
    What this will do is it is a water treatment facility that 
is a line that will connect the two intakes with each other. 
And so should one intake go, unfortunately goes dry, that this 
water treatment facility will be able to cover the current 
lines that we have on line.
    But the tribe has been authorized for, when it was 
originally authorized for the MR&I system, that it was an $80 
million system, given the cost indexing and the lack of 
appropriations that we have gotten on a regular basis, that we 
are now up to about $140 million project.
    Given the rate besides the Recovery Act dollars, given the 
rate of funding that we have gotten, we figure it will take us 
80 years to complete that system so everybody on the 
reservation will have water.
    Mrs. Napolitano. How many years?
    Mr. His Horse is Thunder. Eighty years.
    Mrs. Napolitano. Mr. McDonald, comment?
    Mr. McDonald. The pace at which Congress makes 
appropriations on these rural water projects basically does not 
keep up with the cost of inflation.
    Mrs. Napolitano. Well, we need to have a little bit of 
conversation in the future on how we deal with some of these 
issues, especially in areas where there is no drinking water.
    Mr. Keppen, can you comment on the value of Title XVI to 
the alliance?
    Mr. Keppen. Madame Chairwoman, we have, you know, generally 
been supportive of this, of this program, because indirectly, 
the more flexibility there is in urban areas, the more 
flexibility they have, the more tools that they have, the later 
they will look to Ag for more water. Right, Rich?
    So you know, we have been generally supportive of this 
program, and we stated that in our testimony again. But with 
that said, we sure would have liked to have seen a little bit 
more money in this package focused on AG infrastructure, which 
is really the biggest issue for our organization right now.
    Mrs. Napolitano. Yes, I can understand that. However, for 
some areas, if it hadn't been for recycled water, they would be 
up a creek, literally.
    One of the things that Mr. Atwater and any of you would 
comment, there has been a new, I call it the fourth treatment, 
which is ultraviolet and reverse osmosis, which will render the 
water fairly clean; pure, almost.
    Is there any mindset, does anybody have any concerns that 
we are not pushing this technology? Or that we are not 
requesting recycled water agencies to use the fourth, so that 
that water then can be utilized by anybody, anywhere, any time?
    Mr. Atwater. That is an excellent question. And one of the 
things that the Association has been really proud of. We have 
been working with the Bureau of Reclamation and many 
universities and experts throughout the United States on a 
research program of technical issues like UV and other advanced 
treatment technologies.
    Because, quite frankly, we all recognize that the impaired 
water, whether it is polluted groundwater in the San Gabriel 
Valley or drainage water in the San Joaquin Valley, or in 
Colorado, we need to look at treatment technologies to reuse 
and reclaim and develop, as you point out, Chairwoman 
Napolitano, we don't create new water.
    And these treatment technologies offer a lot of promise to 
expanding our water supplies in the United States.
    Mrs. Napolitano. Mr. McDonald, any comment?
    Mr. McDonald. I think Mr. Atwater said it all.
    Mrs. Napolitano. Anybody else?
    Mr. Keppen. Ms. Chairwoman, I would add one other thing to 
consider here. And that is, we have folks in the Rocky Mountain 
Region that are looking at the tremendous amount of water that 
is being developed, as far as coal bed methane and some of 
these petroleum extraction operations. That water oftentimes, 
it comes out naturally tainted.
    There are huge opportunities there to treat that water, and 
perhaps use it for irrigation. It is kind of like a whole new 
slug of water that could really help the system out.
    And so I know we will continue to look for opportunities to 
do pilot projects and look into the opportunities to increase 
the water pie through those means.
    Mrs. Napolitano. Well, thank you so very much. I think we 
have covered almost every conceivable thing that we could, and 
any others will be given to you in writing, and we would 
appreciate a response. We thank you for all your testimony and 
for your being present and look forward to talking to you in 
the future to see what progress has been made in the areas that 
are so critical for us.
    This concludes the Subcommittee's oversight hearing on the 
American Recovery and Reinvestment Act Funds for the Bureau of 
Reclamation and Water Resources Division of the United States 
Geological Survey.
    Thank you again to the witnesses for appearing before this 
Subcommittee. And your testimonies and expertise have indeed 
been enlightening and helpful.
    Under Committee Rule 4[h], additional material for the 
record should be submitted within 10 business days after the 
hearing. The cooperation of all the witnesses in replying 
promptly to any questions submitted to you in writing will be 
greatly appreciated.
    Thank you, and this meeting is adjourned.
    [Whereupon, at 12:15 p.m., the Subcommittee was adjourned.]

                                 
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