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


 
                           THE RECOVERY ACT:
                       STRENGTHENING OUR ECONOMY

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

                                HEARING

                               before the

                        COMMITTEE ON THE BUDGET
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                               __________

             HEARING HELD IN WASHINGTON, DC, JULY 24, 2009

                               __________

                           Serial No. 111-15

                               __________

           Printed for the use of the Committee on the Budget


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



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                        COMMITTEE ON THE BUDGET

             JOHN M. SPRATT, Jr., South Carolina, Chairman
ALLYSON Y. SCHWARTZ, Pennsylvania    PAUL RYAN, Wisconsin,
MARCY KAPTUR, Ohio                     Ranking Minority Member
XAVIER BECERRA, California           JEB HENSARLING, Texas
LLOYD DOGGETT, Texas                 SCOTT GARRETT, New Jersey
EARL BLUMENAUER, Oregon              MARIO DIAZ-BALART, Florida
MARION BERRY, Arkansas               MICHAEL K. SIMPSON, Idaho
ALLEN BOYD, Florida                  PATRICK T. McHENRY, North Carolina
JAMES P. McGOVERN, Massachusetts     CONNIE MACK, Florida
NIKI TSONGAS, Massachusetts          JOHN CAMPBELL, California
BOB ETHERIDGE, North Carolina        JIM JORDAN, Ohio
BETTY McCOLLUM, Minnesota            CYNTHIA M. LUMMIS, Wyoming
CHARLIE MELANCON, Louisiana          STEVE AUSTRIA, Ohio
JOHN A. YARMUTH, Kentucky            ROBERT B. ADERHOLT, Alabama
ROBERT E. ANDREWS, New Jersey        DEVIN NUNES, California
ROSA L. DeLAURO, Connecticut,        GREGG HARPER, Mississippi
CHET EDWARDS, Texas                  ROBERT E. LATTA, Ohio
ROBERT C. ``BOBBY'' SCOTT, Virginia
JAMES R. LANGEVIN, Rhode Island
RICK LARSEN, Washington
TIMOTHY H. BISHOP, New York
GWEN MOORE, Wisconsin
GERALD E. CONNOLLY, Virginia
KURT SCHRADER, Oregon

                           Professional Staff

            Thomas S. Kahn, Staff Director and Chief Counsel
                 Austin Smythe, Minority Staff Director


                            C O N T E N T S

                                                                   Page
Hearing held in Washington, DC, July 24, 2009....................     1

Statement of:
    Hon. John M. Spratt, Jr., Chairman, House Committee on the 
      Budget.....................................................     1
    Hon. Paul Ryan, ranking minority member, House Committee on 
      the Budget.................................................     2
    Hon. Ken Salazar, Secretary, U.S. Department of the Interior.     3
        Prepared statement of....................................     6
    Hon. Thomas J. Vilsack, Secretary, U.S. Department of 
      Agriculture................................................     8
        Prepared statement of....................................     9
    Hon. Ray LaHood, Secretary, U.S. Department of Transportation    13
        Prepared statement of....................................    15


                           THE RECOVERY ACT:
                       STRENGTHENING OUR ECONOMY

                              ----------                              


                         FRIDAY, JULY 24, 2009

                          House of Representatives,
                                   Committee on the Budget,
                                                    Washington, DC.
    The committee met, pursuant to call, at 10:05 a.m., in room 
210, Cannon House Office Building, Hon. John Spratt [chairman 
of the committee] presiding.
    Present: Representatives Spratt, Schwartz, Kaptur, Doggett, 
McGovern, Tsongas, Etheridge, Yarmuth, DeLauro, Edwards, Scott, 
Langevin, Bishop, Moore, Connolly, Schrader, Ryan, Garrett, 
Diaz-Balart, Jordan, Lummis, Nunes, Harper, and Latta.
    Chairman Spratt. I call the hearing to order and welcome 
our three witnesses today. It is a distinguished panel indeed. 
Secretary Salazar, Secretary Vilsack and Secretary LaHood.
    The topic of today's hearing is the Recovery Act. Seven 
months ago when President Obama took office, the country was on 
the brink of a financial meltdown. Credit was frozen, home 
mortgages--many of them subprime--were being foreclosed at 
record rates. The economy was losing an average of 700,000 jobs 
a month. The stock market had lost nearly $10 trillion in 
wealth and headed downward. Congress and the Obama 
administration took action, bold action. The boldest came in 
late February when we enacted the American Recovery and 
Reinvestment Act, an unprecedented Act, but so were the 
circumstances.
    The Recovery Acts has begun to bear fruit, although we 
still have miles to go before we can say we are at full 
recovery, a full economy. But we are faced no longer with the 
severe critical financial conditions that we found at the 
beginning of this year. The country has lost 6.5 million jobs 
since the recession began in December 2007, 6.5 million jobs. 
This is by far, the worst post-war downturn in employment, but 
we have now slowed down the rate of job loss. The housing 
market--beginning to pick up. Retail sales--beginning to turn 
up. The forecast is for the economy to grow in the third 
quarter.
    The Recovery Act has provided a tax credit for 95 percent 
of all working families, assisted 12 million jobless Americans 
with extra unemployment benefits and increased food assistance 
to low-income families. Already States have drawn down more 
than an $23 billion in additional Medicaid funds as they deal 
with record budget shortfalls. And the Recovery Act has already 
allowed tens of thousands of teachers, law enforcement 
officials, and firefighters to keep their jobs.
    The economic recession that began during the previous 
administration has taken its toll on the Federal budget, no 
doubt about it, leaving the Obama administration and the 
Congress with a massive deficit. That is the bad news: a 
deficit of $1.7 trillion--$1.8 trillion this year. The good 
news is many of conditions that are swelling the deficit to 
these unprecedented levels are non-recurring, one-time events. 
And if we can avoid the recurrence of these events, I think we 
can credibly put the budget deficit on a downward glide path to 
a trillion dollars next year and $525 billion in year 2014.
    We are fortunate today to have three of the key officials 
who are charged with implementing the Recovery Act. They in 
order of when their agencies were incorporated, and I 
understand that is the protocol: Ken Salazar, Secretary of 
Interior; Tom Vilsack, Secretary of Agriculture; and Ray 
LaHood, our old colleague, the Secretary of Transportation. 
These three gentleman need no introduction, they have years of 
experience working to improve the lives of Americans across the 
country through their various previous positions in business, 
and government, and politics. We have a former governor, a 
former Senator, and a former Representative here this morning, 
and three cabinet secretaries, which is probably a precedent 
for this committee. We look forward to hearing your status 
report on the Recovery Act, what is working and what is not by 
the lags and results, and what you recommend for the months 
ahead. We very much appreciate your taking time to join us 
today, but before turning to you for your testimony, let me 
turn to Mr. Ryan for any statement that he a cares to make. Mr. 
Ryan.
    Mr. Ryan. I thank the chairman. I also want to welcome the 
witnesses, Secretary Salazar, Secretary Vilsack, and our good 
old friend Secretary LaHood. I appreciate the opportunity for 
this committee to once again meet on the subject of the 
stimulus bill. Committee hearings are a key component of 
Congress's fact-finding and oversight responsibilities. And I 
will note that I am generally disappointed that we apparently 
will not review in this committee the $1 trillion health care 
expansion currently running through the House.
    But let me turn to the subject of today's hearing, and that 
is the stimulus bill. Prior to enactment the administration 
said the key goal of the stimulus package was to save or create 
millions of jobs. They even released a report showing that the 
stimulus would cap the rise in the unemployment rate at 8 
percent--and please bring the chart if you could.
    Clearly, if look at this chart, that hasn't happened. The 
unemployment rate is already at 9.5 percent, a 25-year high, 
and nearly all economists see it rising further to 10 percent 
by late this year. Since the stimulus was enacted, nearly 2 
million jobs have been lost. The administration continues to 
promise that we will see results soon and that we need to give 
the stimulus more time to work. But most experts are predicting 
a so-called jobless recovery. And least one member of the 
Federal Reserve's policymaking committee believes that the 
unemployment rate will linger at 10.5 percent through next 
year. But while the benefits of the stimulus have turned out to 
be meager and difficult to quantify, its costs have been large 
and crystal clear. It will add $1 trillion to our debt; it 
represents merely the first component of a spending-fueled 
budget, a budget that will triple the national debt over the 
next decade. And while the administration continues it tout its 
commitment to create jobs, it is formulating policies that will 
have the opposite effect in my opinion.
    Their cap-and-trade plan will dramatically raise the cost 
of operating a business and push jobs overseas. And their 
health care plan will shackle individuals and businesses with 
new mandates and taxes as they struggle to get out of this 
recession. Economic growth and jobs will suffer as a result of 
these policies.
    Small businesses create 60 to 80 percent of the new jobs in 
America. But the House health care plan will result in most 
small businesses seeing their tax rate increase from 35 to 45 
percent--over 50 percent if you include State level taxes. In 
my home State of Wisconsin, the top tax rate on small 
businesses, which is where most of our jobs come from, will be 
54.27 percent, higher than France and Germany.
    On Wednesday, the Majority Leader Hoyer, a man for whom I 
have great respect, said the following on the House floor, ``It 
is the private sector that drives our economy. It is the 
private sector that will give us wealth and that creates jobs, 
not the government. But the government can create policies 
within which the private sector and particularly venture 
capitalists can have the confidence that we are managing our 
finances responsibly.'' I couldn't agree more, but I only wish 
that the actual policies coming out of Congress were consistent 
with this sentiment. With that, Chairman, I yield. Thank you.
    Chairman Spratt. Thank you, Mr. Ryan. Just a couple of 
housekeeping details before starting. I ask unanimous consent 
that all members be allowed to submit an opening statement for 
the record at this point. Without objection, so ordered.

STATEMENTS OF HON. KEN SALAZAR, SECRETARY OF THE INTERIOR; HON. 
   RAY LA HOOD, SECRETARY OF TRANSPORTATION; AND HON. THOMAS 
               VILSACK, SECRETARY OF AGRICULTURE

    Chairman Spratt. Gentlemen, thank you for coming again. We 
look forward to your testimony and we have received it 
previously and made it part of the record without objection so 
that you can summarize it as you see fit. But you are the only 
panel today, you have an important message to bring, and we 
would encourage you to take as much time as you feel is needed 
to thoroughly cover the subject with respect to your cabinet 
departments. Let's start in the order of recognition with 
Secretary Salazar.

           STATEMENT OF HON. KEN SALAZAR, SECRETARY,
                U.S. DEPARTMENT OF THE INTERIOR

    Secretary Salazar. Thank you, very much Chairman Spratt and 
Ranking Member Ryan and all the members of the committee. It is 
an honor to be here today to speak on a subject that is very 
important to this Nation, and to all of you, and all the 
Members of the Congress. It is a particular honor to be here 
with my colleagues and friends, Secretary of Agriculture Tom 
Vilsack, and Secretary of Transportation, Ray LaHood.
    When I was sworn in as President Obama's Secretary of 
Interior just over 6 months ago, we were in the throes of a 
crisis which is the worst economic crisis that we have seen 
since the great depression. We are losing 700,000 jobs a month, 
bank lending was frozen. And we were at the risk of falling off 
an economic cliff not seen for over 100 years in America.
    The economic crisis that President Obama and this Congress 
inherited was years in the making. Years of lax oversight, 
years of irresponsible behavior at the highest level, years of 
problems that unfortunately cannot be solved over night. Let 
there be no doubt, America's recovery will take time. But make 
no mistake, we have come a long ways in the 6 months since 
January. Our economy is stabilizing, help is reaching those 
hardest hit by this recession, confidence is returning and 
America has begun to rebuild.
    The Recovery Act is working. We see it working through the 
investments that the Department of the Interior is making 
through the Recovery Act. Congress entrusted the Department of 
the Interior with the responsibility of investing $3 billion to 
create jobs restoring America's National parks and treasured 
landscapes, building clean drinking water infrastructure for 
rural communities, fixing and upgrading aging schools in Indian 
country, and taking on other critically important projects for 
the Nation.
    We are making these investments swiftly on the 18-month 
timeline established by Congress. We are also making these 
investments responsibly. We want to make sure that we get it 
right, as you would want us to do. We want to ensure the 
taxpayer dollars are not going to waste. Every project must be 
worthy of the public's expenditures. Every contract must be 
competed in a fair and open manner. And everything we do must 
be transparent and open to public scrutiny. We are meeting 
these goals and I am proud of the results that we have seen so 
far.
    Since Congress passed the Recovery Act, Interior and its 
agencies have identified 3,382 projects which meet the high 
standards that we have set, that is 3,382 projects which we are 
overseeing. Ninety percent of the $3 billion we are investing 
is helping us meet long deferred maintenance needs that have 
built up in recent years, on roads, trails, facilities, water 
infrastructure and in habitat that we manage.
    The national park system alone has over $8 billion in 
deferred maintenance priorities and there are more deferred 
maintenance projects on the 500 million acres--or 20 percent of 
the Nation's land mass--that we manage on behalf of the 
American people. But we are making swift progress. Since we 
released our final list of Recovery Act projects in late April, 
the Interior has obligated $305 million in Recovery Act funding 
which we estimate has already created more than 3,000 jobs, 400 
projects are already underway.
    By the end of October, we will have obligated nearly $1.1 
billion. And in the next 6 months, we expect to obligate 
another $1 billion. The pace is consistent with the 
construction-based nature of the majority of projects. Just as 
you can't build a new house overnight, some of our projects 
will take time to complete. They will, however, employ people 
at every step of the way. Surveyors, architects, contractors, 
carpenters, plumbers, electricians, not to mention all those 
who build and sell the materials that are going into these 
projects, companies that sell solar panels, firms that design 
stream gauges, all of these people and businesses will have an 
opportunity to go to work.
    We are seeing the benefits of the Interior's Recovery Act 
investments in communities all across the country. It is 
companies like DLM Contracting in Bozeman, Montana, as you will 
see in this picture. In a normal summer construction season, 
DLM employs 25 to 30 people. But this year there was no work 
for the employees at DLM. They bid on 20 jobs last winter, that 
is how bad it was. Twenty jobs and got none, they got none. 
Since then, they have won two Recovery Act bids, including a 
$7.1 million road project in Theodore Roosevelt National Park 
in North Dakota. Brad Lewis, this is a citizen of America, says 
the following, that the Recovery Act, ``made the difference for 
the company this year.'' They have hired workers, they are 
getting moving again. It's companies like AGC Architects in 
Salt Lake City. Jill Jones is the owner of this company. She 
says she would have lost over a third of her staff without the 
Recovery Act working for her firm, and doing for the National 
Park Service and other Federal agencies the work that she is 
doing.
    Thanks to the Recovery Act projects they are holding 
strong, Jill's employees know their jobs are secure. She says 
the Recovery Act has changed the confidence level of the 22 
people working here. I believe it has a ripple effect that will 
move across the country as more and more of these Recovery Act 
projects hit the ground. It is people like Kelly Hanson, he is 
a carpenter for Northern Management Services of Boise, Idaho, 
one of 34 tradesmen and laborers who are working on the 
renovation of the San Francisco Bay National Wildlife refuge 
headquarters.
    He says, ``I come from Idaho where the little towns are 
getting hurt first. A lot of people I used to work for have 
lost everything. Here in California they have never seen it so 
bad. The stimulus money has cut through the red tape and put us 
to work. I would be out of a job without it.'' You are hearing 
from a lot of businesses like these. A large percentage of 
Interior's obligated funds have been awarded to small and 
disadvantage businesses. And we will hear more stories in the 
coming months.
    In the next 8 months we will begin an additional $1.8 
billion of work that will create or save 19,000 more jobs in 
this country. Under the Recovery Act, we will see a school 
fixed in Standing Rock, North Dakota, and a school rise on the 
Indian lands in Chinle, Arizona. We will see 450,000 people in 
rural communities in South Dakota get clean drinking water from 
three new water treatment facilities. We will see drought-
stricken communities in California get some help. And we will 
make down payments on long-term water infrastructure needs in 
California and around the country. We will see more and more 
young people get to work in the outdoors.
    The Fish and Wildlife Service's northeast region has 
doubled the size of its youth conservation corps. Among our 
young people unemployment is the highest; we have brought young 
people to work on many of these public projects much in the 
same way as Franklin Delano Roosevelt did in the 1930s through 
the Civilian Conservation Corps.
    Mr. Chairman and Ranking Member Ryan, members of the 
committee, I look forward to continuing to work closely with 
you to ensure that we are implementing the Recovery Act as 
swiftly, as openly, and as responsibly as the American people 
deserve. The Office of Inspector General at Interior is also a 
key partner with us, for they are helping us implement the 
Recovery Act with a very robust set of internal controls to 
ensure adequate oversight and management of these funds. We 
take our responsibility seriously under the law, very 
seriously. And we can report today that the Recovery Act is 
working. It is helping stabilize our economy, it is putting 
people back to work, and it is helping us protect our Nation's 
treasured landscapes for generations to come. Thank you, Mr. 
Chairman.
    Chairman Spratt. Secretary Salazar, thank you.
    [The prepared statement of Secretary Salazar follows:]

           Prepared Statement of Hon. Ken Salazar, Secretary,
                    U.S. Department of the Interior

    Chairman Spratt, Ranking Member Ryan, and Members of the Committee, 
thank you for giving me the opportunity to testify today. I am pleased 
to be appearing with Secretary Vilsack from the Department of 
Agriculture and Secretary LaHood from the Department of Transportation 
to discuss implementation of the American Recovery and Reinvestment 
Act.

                              INTRODUCTION

    The Department of the Interior is investing $3 billion under the 
Recovery Act in approximately 3,400 critical projects across this 
nation in our unique portfolio of irreplaceable national treasures and 
critical infrastructure in a manner that will create employment and 
economic activity.
    With these funds we are making the most significant improvements to 
our buildings, trails, roads, and other public lands infrastructure 
since President Franklin D. Roosevelt mobilized the Civilian 
Conservation Corps in the midst of the Great Depression. We believe the 
Recovery Act program will have a similar legacy of success in creating 
desperately needed employment opportunities, while also making lasting 
impacts in the preservation and enhancement of America's timeless 
treasures, monuments to liberty, and icons of our culture and heritage. 
At the same time we are making investments that will restore 
functionality, improve energy efficiency, and advance important 
national goals for renewable energy, environmental restoration, and 
water conservation.
    While we are implementing the Recovery Act with maximum focus on 
expediting these critical investments to create jobs as quickly as 
possible, we are placing equal emphasis on ensuring that projects are 
worthy of the public's expenditure, contracts are competed in a fair 
and open manner, and that our activity is transparent and open.

                            PROGRAM OVERVIEW

    The Department of the Interior manages 500 million acres or 
approximately 20% of the land mass in the Unites States, including 391 
National Parks covering 84 million acres, 96 million acres managed by 
the Fish and Wildlife Service, 56 million acres of Indian and tribal 
lands held in trust, and 256 million acres under the Bureau of Land 
Management. We are also the largest supplier of water in the Western 
United States through the Bureau of Reclamation, including the 
management of facilities such as the Hoover Dam, Glen Canyon Dam and a 
huge network of other equally essential facilities.
    The Department's Recovery Act program emphasizes critical 
maintenance, rehabilitation and replacement of roads, trails, habitat, 
facilities, and water infrastructure with over 90% of our $3 billion 
funding these essential projects. Additionally, some of the funds are 
going to important efforts in Indian Country such as construction and 
renovation of schools, roads, and housing projects, loan guarantees for 
small business, and workforce training. Finally, our program also will 
make important investments in improving our scientific monitoring 
network through the U.S. Geological Survey.
    We are pursuing these investments in a manner that significantly 
increases our commitment to engaging young people on our public lands. 
Specifically, 346 of our Recovery Act projects will involve youth in 
rebuilding trails, restoring critical habitat and performing other 
essential activities.
    Over 1,000 of our projects include energy efficiency and renewable 
energy components which will both conserve energy and bring cost 
savings to facilities across our system. In addition, the Bureau of 
Land Management will invest $41 million in efforts to dramatically 
enhance its ability to efficiently permit commercial scale renewable 
energy projects on our public lands.

                       PROGRESS IMPLEMENTING ARRA

    Five months ago, in February, when the Recovery Act was enacted by 
the Congress and signed by the President, we had already initiated a 
process to develop a set of projects using a merit-based process and 
transparent criteria. While understanding the need to move quickly, we 
continued this process in a careful and deliberate manner to ensure 
that each of our projects had merit and could be executed within the 
timeframe provided in the legislation. Each of our bureaus utilized 
their inventory of projects that had already undergone significant 
planning and design and clearances and developed plans consistent with 
congressional direction.
    We released our final list of projects in late April and we have 
made great progress since then. As of July 17, 2009, DOI has obligated 
$305 million in Recovery Act funding, creating approximately 3,300 job 
years. We are projecting obligations of nearly $1.1 billion by the end 
of FY 2009 and another $1 billion in the first and second quarters of 
fiscal 2010. This pace is consistent with the construction-based nature 
of the majority of our projects where each contract is fairly and 
openly competed and money is obligated and spent at an increasing pace 
over a 12 to 24 month period as work progresses. I am also pleased to 
report that Interior continues to meet its commitment to small and 
disadvantaged businesses.
    We have initiated almost 400 projects to date, including:
     27 Title XVI water reclamation and reuse projects totaling 
$134.3 million in Recovery Act funds of which $131.8 million is 
allocated to projects in drought-stricken California. This funding will 
be leveraged by local sources to deliver more than $675 million in 
Title XVI projects.
     Three water treatment facilities totaling $93 million 
which will provide better drinking water to approximately 450,000 
people in rural communities in South Dakota, Iowa and Minnesota.
     A trail rehabilitation project on the South Kaibab Trail 
at Grand Canyon National Park.
     A $56 million school replacement project for the Rough 
Rock Community School replacement project in Chinle, Arizona and 
another $8.2 million major renovation of Standing Rock High School in 
Standing Rock, North Dakota.
    One thing I need to make clear is that in our case, as with most 
construction-based projects, jobs are created beginning with the 
obligation of funds and are not tied to the actual outlay of dollars. 
The Department pays only upon the demonstration of progress or 
completion in the majority of our program. Thus, the discussion 
regarding the pace of actual spending and its relationship to economic 
activity is misplaced in our case, as obligations lead directly to new 
jobs and economic activity.
    Interior is working aggressively to accelerate the pace of its 
contractual awards. We have engaged a highly qualified international 
engineering firm to support us in this effort and are implementing 
resource sharing, procurement and other strategies that will not only 
help us better execute the Recovery Act, but also permanently improve 
our efficiency and operating capacity.
    While speed is critical, we are also very focused on doing good 
projects and investing the public's dollars wisely and transparently. 
We are working collaboratively with our Office of Inspector General to 
execute the Recovery Act with a very robust set of internal controls to 
ensure adequate oversight and management of these funds. The OIG is 
also providing us with timely and focused input regarding our business 
practices, areas of potential risk and mitigation strategies and 
opportunities to implement best practices across our organization.

                               CONCLUSION

    The Recovery Act has already made significant contributions to the 
restoration of our nation's economic health, but its benefits are only 
just beginning to be fully felt as the Department of the Interior's 
work so clearly manifests. Over the next eight months, we will begin 
approximately $1.8 billion of work creating at least 19,000 jobs in 
projects that will leave a permanent legacy of good stewardship in many 
of our most treasured landscapes, as well as providing critical water 
infrastructure in rural communities across the West. We look forward to 
the contributions this work will make to our nation's economic recovery 
in the coming months on the timeframe established in the initial 
legislation.

    Chairman Spratt. Now Secretary Vilsack.

           STATEMENT OF HON. TOM VILSACK, SECRETARY,
                 U.S. DEPARTMENT OF AGRICULTURE

    Secretary Vilsack. Mr. Chairman, thank you to you and to 
the ranking member and to members of this committee for the 
opportunity to be here today, and I want to thank Secretary 
Salazar and Secretary LaHood for their service, and I am proud 
to be with them this morning.
    I appreciate the opportunity to report to you on the United 
States Department of Agriculture's work on the Recovery Act. 
And I believe too that our report will reflect that the 
Recovery Act is working. It is transitioning America from bad 
times to better times and getting the work accomplished around 
the Nation that Americans want done. The investments we are 
making are not only creating economic stability, but also 
funding the technology and infrastructure that will lay the 
groundwork for future economic growth.
    When President Obama took office, we were, indeed, as you 
have indicated, Mr. Chairman, facing the worst economic crisis 
in modern time. The economy was, in fact, losing 700,000 jobs 
per month and shrinking at a rate of 6.3 percent. Foreclosures 
were at record levels and housing investment had fallen by more 
than 40 percent. Major financial institutions were failing and 
credit was indeed frozen. Clearly, doing nothing in this 
economic crisis was not an option. Less than 8 decades ago we 
experienced the dramatic negative implications of inaction. We 
have seen that the people hit hardest are ordinary Americans 
who struggle to put food on the table, clothe their children 
and maintain housing. We also know that every day we fail to 
act, the long-term implications are that the road toward 
financial stability is pushed further away, if not years into 
the future. Thankfully, many of the folks who lived through the 
Great Depression are still among us. It would have been an 
affront to their experiences if we didn't do better this time 
and take action to save our children from some of the suffering 
and hardship they endured in their formative years.
    The unraveling of the economy did offer a chance for us to 
be both responsive and proactive through the passage of the 
Recovery Act. Fortunately we will never know the full scope and 
duration of the pain America would have endured had the Nation 
not been mobilized into action. In less than 150 days, the 
Recovery Act has worked to stabilize economic conditions and 
helped those harmed by the economic crisis. The problems that 
led the Nation to the brink were created over several years and 
cannot be instantly solved. We have created the stability 
needed to get us there and are making strides in helping those 
negatively affected by the downturn.
    From the respective of the USDA, we are reaching out to 
every American every day to improve lives and prepare for 
future economic prosperity. In less than 150 days, the USDA has 
announced the availability of $27.4 billion of the $28 billion 
of funds provided through the Recovery Act. We have provided 
more than 45,636 loans to Americans who are deeply impacted by 
the economic crisis, and have begun implementation of more than 
a thousand Recovery Act projects.
    The USDA has provided additional resources through our 
nutrition assistance program. Over 33 million Americans 
received a 13.6 percent increase in benefits under the 
Supplemental Nutrition Assistance Program, or SNAP. For most 
families of 4, this is an extra $80 per month at the grocery 
store. It, in fact, creates $800 million a month in direct 
stimulus to the economy. Research suggests that every dollar in 
spending from SNAP results in $1.84 in total economic 
activities. And further, our data indicates that 97 percent of 
funding received through this program is spent within 30 days 
of receipt.
    Some of the other accomplishments to date at USDA include: 
43,000 housing loans; 2,636 direct operating loans to farmers, 
with 1,081 of those going to beginning farmers and 600 of those 
going to socially disadvantaged farmers; 323 water and waste 
projects; 600 community facility projects; more than 100 
watershed projects; 288 floodplain easement projects; 169 wild 
land fire management projects; and 343 capital improvement 
projects in our forest service.
    We are particularly enthusiastic about the rural broadband 
funding provided under the Recovery Act, which provides $2.5 
billion to provide broadband services to underserved and 
unserved communities to position them for the next generation 
of technology and economic growth.
    Mr. Chairman, considering the state of the economy at the 
close of 2008, we are in a remarkable position at present. 
Including loans and guaranteed loans, we have, in fact, 
announced $48 billion of the $52 billion in program level 
funding, or more than 92 percent of the program level funding 
provided to us in the statute.
    Governmentwide, about 28 percent of the funds have been put 
to work in about 24 percent of the days of the Recovery Act. We 
are on track, but it is important for us to stay focused on the 
mission at hand and to continue our commitment. It is going to 
take time. The law was designed for 2 years of action. And it 
is critically important we see the plan through. It is going to 
take courage to hold our ground and remain committed to the 
program of recovery for the American people.
    Mr. Chairman, USDA is up to this challenge. I am proud to 
represent the men and women of our Department here this 
morning, and I will be happy to respond to questions from 
members of the committee after Secretary LaHood has given his 
comments.
    Chairman Spratt. Thank you, Mr. Secretary.
    [The prepared statement of Secretary Vilsack follows:]

        Prepared Statement of Hon. Thomas J. Vilsack, Secretary,
                     U.S. Department of Agriculture

    Mr. Chairman and Members of the Committee, thank you for the 
opportunity to appear here today before the House Committee on the 
Budget to provide an update and highlight the many successes of the 
American Recovery and Reinvestment Act of 2009 (Recovery Act) for the 
United States Department of Agriculture (USDA). I am pleased to be 
here, along with Secretary LaHood and Secretary Salazar, to report that 
the Recovery Act is working. The achievements of the legislation show 
the Recovery Act is transitioning America from bad times to better 
times and getting the work accomplished around the Nation that 
Americans want to see completed. The investments we are making are not 
only creating jobs and economic stability, but also funding the 
technology and infrastructure that will lay the groundwork for future 
economic growth.

                  THE RECOVERY ACT IN HISTORIC CONTEXT

    Some critics argue the Recovery Act was unnecessary or is not 
working. Some argue that because unemployment is rising, the 
legislation has failed. It is important to remember the Recovery Act 
was intended to slow the economy's downward spiral. Without this 
legislation, economists have argued that conditions would be much 
worse. The Recovery Act is working to slow the economic decline and 
stabilize our economy.
    When President Obama took office, the United States was facing the 
worst economic crisis in at least two decades and the economy was in 
the worst recession experienced in modern times. The American economy 
was losing, on average, 700,000 jobs per month and shrinking at a rate 
of 6.3 percent. The worst level the United States had seen since 1982. 
Foreclosures were at record levels and the rate Americans were 
investing in housing had fallen by more than 40 percent in eighteen 
months. Major financial institutions, both private and government-
chartered, were failing because of this crisis. There was a near halt 
at every level of the financial system from the commercial paper market 
to consumer credit. Millions of folks with retirement investments lost 
nearly $10 trillion in wealth in the stock market, which was on a 
steady downward spiral. Americans' saving rate went from 8 percent of 
income to almost zero and many were running up debts as they tried to 
make ends meet.
    Clearly, doing nothing in this economic crisis was not an option. 
Less than eight decades ago, we experienced the dramatic negative 
implications for inaction. We have seen the people hit hardest are 
ordinary Americans who struggle to put food on the table, clothe their 
children and maintain housing. We also know that every day we fail to 
act, the long term implications and the road toward financial stability 
is pushed further away--if not years into the future.
    Thankfully, many of the folks who lived through the Great 
Depression are still among us. It would have been an affront to their 
experiences if we didn't do better this time and take action to save 
our children from some of the suffering and hardship they endured in 
their formative years. Unlike the case of an emerging natural disaster 
which does not always provide the luxury of time to take mitigation 
measures, the unraveling economy did offer a chance for us to be both 
responsive and proactive. Through the foresight and wisdom of Congress, 
and the Administration, swift action was taken to slow the economic 
tsunami. On February 17, 2009 President Obama signed the American 
Recovery and Reinvestment Act into law. Fortunately, we will never know 
the full scope and duration of the pain America would have endured had 
the Nation not been mobilized into action.
    In less than 150 days, the Recovery Act has worked to stabilize 
economic conditions and helped those harmed by the economic crisis. The 
problems that led the Nation to the brink were created over several 
years and cannot be instantly solved. While the Nation may not be in 
full-scale recovery yet, we have created the stability needed to get us 
there and made strides in helping those negatively affected by the 
downturn. From the perspective of the United States Department of 
Agriculture, we are reaching out to every American everyday in every 
way through the far reach of our mission and authorities to improve 
lives and prepare for future economic prosperity.

 UNITED STATES DEPARTMENT OF AGRICULTURE ACHIEVEMENTS IN RECOVERY ACT 
                             IMPLEMENTATION

    USDA's goal is to quickly respond to current economic conditions by 
preserving and creating high quality jobs, spurring rural economic 
activity, and contributing to the Nation's overall financial health. 
USDA will be open and transparent and responsive and accountable to the 
American people as we deliver Recovery Act funding.
    In less than 150 days, USDA has announced the availability of $27.4 
billion of the $28 billion of funds provided through the Recovery Act. 
In terms of obligations, USDA has obligated approximately $4.1 billion 
of the $28 billion in budget authority provided to our Department. In 
considering this, it is important to remember that USDA's ARRA funds 
include almost $20 billion in enhanced SNAP benefits to be distributed 
over a five year window. We have provided more than 45,636 loans to 
Americans who were deeply impacted by the economic crisis and begun 
implementation of more than 1,000 Recovery Act projects. In fact, just 
this week, I announced more than $274 million in American Recovery and 
Reinvestment Act (ARRA) funds for 191 forest facilities, trails and 
related ecosystems projects.
    Several of the facilities projects include new energy efficient 
technologies. In fact, the solar panels proposed for the Forest 
Service's San Dimas Technology and Development Center in southern 
California will produce enough electricity to meet all of the center's 
needs, thus making it a ``zero-net-energy'' facility. These projects 
exemplify President Obama's commitment to sustainability, reducing our 
environmental footprint and increasing energy efficiency, which will 
benefit the 178 million people who visit the National Forests each 
year, generate additional tourism activity and stimulate local 
economies.
    Under the Recovery Act, we have taken the opportunity provided to 
reach those Americans who have been underserved and need assistance 
most. USDA has distributed 2,636 Farm Operating Direct Loans to assist 
eligible family farmers and ranchers in building and sustaining 
successful farm operations. Of these 2,636 recipients, 1,081 are 
beginning farmers and 600 are socially disadvantaged farmers. This is a 
statistic that we are proud of and one on which we will continue to 
focus on throughout Recovery Act implementation.
    The additional funding provided by the Recovery Act has made it 
possible to reach more farmers and ranchers where no lender is 
available or able to provide credit. For farmers, the ability to absorb 
input costs up front such as fertilizer and seed purchases, equipment 
rental and labor costs is essential to ensuring a viable harvest. In 
cases such as this, our Direct Farm Operating Loans have meant the 
difference between agriculture producers growing a crop and perhaps a 
profit this year, or simply closing down the operation. A lost farm has 
serious negative ramifications to the surrounding community. The local 
feed store, the farm equipment dealership, and the food supply chain 
are all part of an interwoven connection across rural America.
    USDA has provided additional resources through five major nutrition 
assistance programs, as a result of Recovery Act funding. Over 33 
million Americans received a 13.6 percent increase in benefits under 
the Supplemental Nutrition Assistance Program (SNAP, formerly named 
Food Stamps). For most families of four, this is an extra eighty 
dollars per month at the grocery store, totaling $800 million a month 
in direct stimulus to the economy. Our estimates show that money spent 
on SNAP may have even larger effects on economic activity than other 
types of government spending. And further, our data indicates that 97 
percent of funding received through this program is spent within 30 
days of receipt. Not only does this assistance allow families to 
provide more nutritious and abundant meals for families, it also a 
direct form of stimulus to our economy and goes to people who are 
already certified as being in need.
    Some of our other Recovery Act accomplishments within the first 150 
days include:
     Over 43,000 Single Family Housing Loans to purchase, 
construct, or rehabilitate a home in a rural area. With these loans, 
families can have a home, and contribute to a community.
     323 Water and Waste Disposal loans and grants to construct 
or improve facilities that will provide communities safe drinking water 
and safe, sanitary waste disposal. Many of the benefiting communities 
are small towns that either have no existing water infrastructure or 
substandard or even unsafe facilities currently in place. These 
projects not only improve public health and safety, but also offer 
environmental improvements. And in some cases these projects provide 
the necessary infrastructure to attract businesses and industry to the 
area.
     600 Community Facilities projects, including public safety 
vehicles, libraries, and health care centers. These are wealth creation 
projects that provide long-term economic and social improvements to 
communities.
    An excellent example of this kind of work is the Darlington County 
Society Hill Library. This county received a Community Facility Loan in 
the amount of $787,000 to construct a new 4,200 square foot library 
building to replace an existing 850 square foot building located in the 
in the town of Society Hill in South Carolina. The new library will 
provide informational, educational, and recreational needs for the 
4,000 residents who live in the greater Society Hill area of Darlington 
County.
    The need for a larger library to serve the needs of the community 
has become more and more apparent. This community is isolated from the 
larger more complete libraries in Darlington and Hartsville by nearly 
seventeen miles in either direction. Junior high and high school 
students depend on the library for research materials and computer 
access. The local textile plant has laid-off the remainder of its 
employees. These and other adults come to the library for help in 
locating jobs, instructions in completing a resume, and using computers 
to submit their resumes electronically.
    The community and mayor support the library project and the County 
Council donated one and one-half acres of land for the library. The 
state senator secured $250,000 in state funds for the project and 
several local corporations have donated $30,000. A local Friends 
Library Group has raised approximately $10,000. This property is 
located in the heart of the town at a convenient location.
     80 Watershed and Flood Prevention Operations projects 
providing flood prevention and mitigation for communities, improved 
rural water supply, environmental mitigation measures and formation of 
wetlands and wildlife habitat, and even increased water supplies for 
rural firefighting.

                         FUTURE ECONOMIC GROWTH

    We are proud of the work we have accomplished so far, but realize 
there is a lot more work to be done. Through our work in the Recovery 
Act, we have taken action that is long overdue and are funding 
essential programs that benefit all of America. Clearly, these programs 
and services are doing more than providing dollars into rural 
communities. These projects represent the hopes and needs of people 
across the Nation. In many cases, local communities have been waiting 
for decades for these projects to be accomplished and the services to 
be made available. Completing them sets the stage for additional 
economic activity in the future. The Recovery Act has created the 
opportunity and provided the resources to get the job done. An even 
more expansive table illustrating the programs, services, and funding 
made available through USDA Recovery Act programs is attached for the 
record as Appendix A.
    We are particularly enthusiastic about the Rural Broadband 
initiatives funded under the Recovery Act. The Recovery Act provides 
USDA with $2.5 billion to provide broadband services to rural and 
underserved communities. In addition, the Recovery Act provides the 
Department of Commerce with $4.7 billion to support grants to provide 
broadband service to unserved and underserved areas. Many individuals, 
schools, libraries, and healthcare facilities will obtain broadband 
capabilities for the first time. The legislation provided clear 
direction and a unique and historic opportunity to provide broadband 
into rural areas that otherwise would not have the resources to install 
broadband. Rural and poor areas are most often the ones that are not 
considered good investments by companies installing broadband. We also 
have an opportunity to give communities that might otherwise would be 
overlooked a chance to be positioned for the next generation of 
technology and the next phase of U.S. economic growth.
    Rural Broadband means better and quicker access to information and 
the infrastructure to operate and compete in a 21st century economy. 
Access to rural high speed broadband will open up these areas to global 
markets and global economic opportunities. The future business 
development and the impact that broadband development can have on rural 
America can only be compared with our efforts to provide 
electrification and telecommunications to rural America in the 1930's 
and 1940's. In those days, having a viable farm meant having access to 
electricity for power for future equipment upgrades, refrigeration, and 
product enhancement. So to, the provision of rural broadband will 
prepare a generation of rural Americans for the 21st century economy by 
providing access to high speed internet access that is necessary to 
open up rural areas to global markets and global economic 
opportunities.

        RECOVERY ACT IMPLEMENTATION--NOT JUST BUSINESS AS USUAL

    With Recovery Act implementation, time is of the essence. Keeping 
farmers on the land and ensuring that local rural communities do not 
permanently cease viability, has required swift action. We are pleased 
that we are right on schedule with respect to obligating Recovery Act 
dollars under the timeframe provided in the statute. But more so than 
acting quickly and with a sense of urgency, we have set a goal 
throughout the Executive Branch, including USDA, to act effectively and 
also to seize the opportunity to also do business differently than in 
the past. Within the Administration, unprecedented standards of 
efficiency and accountability have been established. Recovery Act 
dollars are not going toward Congressional earmarks or purposes of 
political expediency. Government-wide, Recovery Act projects are coming 
in as much as 10 to 30 percent under budget, which means the ability to 
fund even more projects across the Nation. We have been pleased at USDA 
to see that individual projects have not exceeded projected costs to 
date and program implementation has been effective.
    Beyond individual program efficiencies, we have also sought to 
achieve better leveraging and synergy between programs--both within 
USDA and also interDepartmentally. Within our Department, we have 
established a Recovery Act implementation team, which looks at cross-
cutting implementation issues, identifies barriers, and recommends 
solutions to levels of higher authority and policy decision-makers. 
Also, the team functions to identify opportunities for coordination of 
funding, so communities can get the most out of government programs.
    In addition, the Administration has established Rural and Urban 
coordinators across the Executive Branch to partner with federal 
Departments and find opportunities to partner up on programs and 
leverage government funding. For example, will installation of new high 
speed rail service under consideration by the U.S. Department of 
Transportation change the community needs for water and waste water 
service? Will the relocation of a business alter the needs for 
community facilities? Can investments made in rural broadband connect 
with potential healthcare facility improvements that may be under 
consideration through the U.S. Department of Health and Human Services? 
These are the questions that we are asking, and through better 
communication and collaboration, we will identify answers that better 
serve all programs and funding resources.
    I am proud that the USDA has served as a central hub for web-based 
communication for the Federal government about projects supported by 
the Recovery Act. Our web-based geospatial tool and mapping program has 
provided a transparent means for the public to track the location, 
purpose, and funding provided for all of our Recovery Act projects and 
provide feedback. Thus far, the United States Department of Housing and 
Urban Development has partnered to include its data on the site, and 
many additional federal agencies will be coming online soon. The web-
based tool provides an easy way to identify and connect common projects 
and achieve the kinds of synergy and efficiency that we are seeking.

                         LOOKING TO THE FUTURE

    Mr. Chairman, considering the state of the economy at the close of 
2008, we are in a remarkable position at present. In total, USDA has 
announced $27 billion of the $28 billion of funds provided through the 
Recovery Act. Including loans, we have announced $48 billion of the $52 
billion in program level funding, or more than 92 percent of the 
program level authority provided to us in the statute. Government-wide, 
about 28 percent of the funds have been put to work in about 24 percent 
of the days of the Recovery Act.
    Soon, the Administration will start awarding over $15 billion in 
grant funding for three visionary Recovery Act programs, broadband, 
high speed rail and a smarter electric grid infrastructure. These 
activities will not only create jobs now, but will shape America's 
economy for tomorrow. Our efforts are contributing to stabilizing the 
economy and we are beginning to see signs of progress.
    It is important we stay focused on the mission at hand and we 
continue our commitment to implement the Recovery Act approach that has 
been established. The economic challenges we are working to overcome 
were the result of years of deferred problems and accumulated negative 
effects. Reversing this course is going to take a strong commitment. It 
is going to take time. The law was designed for two years of action and 
it is critically important we see the plan through. It is going to take 
courage. It will take courage to stand our ground and acknowledge that 
we do not want to replicate the difficult lessons that our grandparents 
learned in the past. It will take the courage and commitment of the 
Nation's leaders to hold their ground and remain committed to the 
program of recovery for the American people. It is also going to take 
the commitment of all American's to carry this through and ensure a 
better tomorrow for our children.
    Mr. Chairman, the United States Department of Agriculture is up to 
this challenge. I am proud to represent the men and women of our 
Department here this morning and I will be happy to respond to any 
questions that Members of the Committee might have.

    Chairman Spratt. Secretary LaHood.

           STATEMENT OF HON. RAY LA HOOD, SECRETARY,
               U.S. DEPARTMENT OF TRANSPORTATION

    Secretary LaHood. Thank you, Mr. Chairman. I am delighted 
to be here with my two colleagues from the Cabinet and to be 
back at the Budget Committee, of which I was a member for one 
term. And I thank you for the opportunity to discuss the U.S. 
DOT progress in implementing the American Recovery and 
Reinvestment Act of 2009.
    The Recovery Act is an extraordinary response to a crisis 
unlike any since the Great Depression. This landmark 
legislation is the most sweeping, complex and ambitious 
domestic aid package we have enacted in generations. It 
reflects an unprecedented effort to jump-start our economy, 
create or save millions of jobs, and put a down payment on 
addressing long neglected challenges so our country can thrive 
in the 21st century.
    Since this legislation was enacted, the Department of 
Transportation has been working hard to ensure that the 
Recovery Act is implemented quickly, wisely and with 
unprecedented transparency and accountability to finance 
transportation projects throughout America.
    Today I want to share with you our accomplishments and our 
plans for the future.
    To date, the Department has made nearly half of its funds--
$22 billion--available to States so they can green-light 
priorities projects to rebuild and modernize roads, bridges, 
transit systems, airports and seaports. We have approved over 
6,600 projects for highways and other transportation project 
nationwide. Of those, more than 3,200 roads, transit, and 
airport improvement projects are underway right now.
    Within DOT, our modal agencies are doing an outstanding job 
of making recovery funds available as quickly as possible. So 
far, the Federal Aviation Administration has allocated 
virtually all of its stimulus funds--more than $1 billion--to 
airports all over the country.
    The Federal Highway Administration has obligated nearly 
two-thirds of the $27.5 billion appropriated by Congress. More 
than $1 billion in new Amtrak projects have been approved. And 
for public transit an unprecedented $3.2 billion in grants have 
already been awarded, and another $5 billion is in the 
pipeline.
    In the coming months, we will begin awarding grants from 
our $8 billion fund to develop new high-speed passenger rail 
corridors, which has generated a great deal of interest and 
excitement around the country. And our discretionary $1.5 
billion TIGER grant program will invest in priorities which are 
multimodal projects to ensure more competitive and enhanced 
liveability and sustainability.
    Thanks to the excellent staff work and our productive 
relationships with State DOT officials, every state met the 
Congressional deadline to obligate 50 percent of the highway 
formula funds allocated to them within the first 120 days, 
which is what Congress asked us to do. Transit agencies around 
the country are on track to meet a September 1 deadline for the 
same milestone, with 50 percent of the formula funds obligated.
    In speaking to governors, mayors, State transportation 
officials, and private contractors all over the country, I have 
been, since I was sworn in on January 27th, to 24 States and 41 
cities. And I have found there is widespread agreement that 
without these well timed Federal investments in infrastructure 
and State services, our economy would probably be in much worse 
shape.
    While the Recovery Act cannot make up for all the jobs our 
economy has shed, every single job these investments helped to 
protect or create counts as a victory. Over 5,000 jobs have 
already been supported through spending on transportation 
products. And we estimate that over 500,000 jobs will 
eventually be supported once the full effect of the Recovery 
Act is felt in the Transportation industry; 500,000.
    I also want to highlight our success in overseeing this 
complex program while keeping our promise to America to meet 
the high standards for transparency and accountability. I am 
happy to report that in all 50 States and territories, not a 
single case of serious abuse of funds has been identified. That 
is a remarkable achievement for the fast-moving program of this 
scope. I am very proud to say no earmarks, no sweetheart deals, 
no boondoggles. A share of the credit goes to our DOT 
management team for the Recovery Act, known as the TIGER team, 
which has helped to keep our implementation on track, keep our 
funds flowing and create a system for meeting all congressional 
requirements.
    In addition, we have completed three phases of risk 
management plan for all Recovery Act programs and we will 
continue to update our plan to ensure that all dollars are 
spent effectively. As part of this plan we have developed a new 
risk assessment tool that has been adopted by the Office of 
Management and Budget for government-wide use. This tool 
provides a strong foundation for managing our internal control 
process.
    And our accountability executive board continues to work 
closely with the DOT Office of Inspector General and the 
Government Accountability Office to maintain open lines of 
communications with our auditors, so we may identify and 
address any concerns as early as possible. I am confident that 
years from now when we look back on the American Recovery and 
Reinvestment Act, we will recognize that the investments we 
made in infrastructure, energy conservation, education and 
other vital needs mark a turning point in our economy. The 
American people have said loud and clear they want us to 
rebuild our crumbling roads and bridges, build clean and green 
public transportation systems to help ease traffic congestion. 
We are putting Americans to work doing just that.
    I look forward to any questions that any of you may have. 
Thank you, Mr. Chairman.
    [The prepared statement of Secretary LaHood follows:]

           Prepared Statement of Hon. Ray LaHood, Secretary,
                   U.S. Department of Transportation

    Chairman Spratt, Ranking Member Ryan, and Members of the Committee, 
thank you for the opportunity to appear before you today to discuss the 
U.S. Department of Transportation's (DOT) progress in implementing the 
American Recovery and Reinvestment Act of 2009 (Recovery Act). The 
Recovery Act is an extraordinary response to a crisis unlike any since 
the Great Depression. This landmark legislation is the most sweeping 
and ambitious domestic aid package we have enacted in generations. It 
reflects an unprecedented effort to jumpstart our economy, create or 
save millions of jobs, and put a down payment on addressing long-
neglected challenges so our country can thrive in the 21st century. 
Since this hallmark legislation was enacted, the Department of 
Transportation has been working hard to ensure that the Recovery Act is 
being implemented quickly, wisely, and with unprecedented transparency 
and accountability to finance transportation projects throughout 
America. Today, I want to share with you our accomplishments and our 
plans for the future.
    Less than six months after the enactment of the Recovery Act, the 
Department has a great deal to show for taxpayers' investments. 
Congress provided the Department of Transportation with more than $48 
billion in Recovery Act funds. That is equal to nearly two-thirds of 
our entire annual budget request for fiscal year 2010. It is an 
enormous opportunity for us, and we are working overtime to make the 
most of it.
    To date, the Department has made nearly half of its funds--almost 
$22 billion--available to the States and others so they can green-light 
priority projects to rebuild and modernize roads, bridges, transit 
systems, airports, and seaports. We have approved over 6,600 projects 
for highway and other transportation projects nationwide. Of those, 
more than 3,200 road, transit and airport improvement projects are 
under way right now.
    I am pleased to report to you that the Department has a strong 
momentum going in the implementation of these programs. The Federal 
Aviation Administration met the requirements in the Recovery Act and 
has allocated virtually all of its stimulus grant funds--more than $1 
billion--to airports all over the country. The Federal Highway 
Administration (FHWA) has obligated nearly two-thirds of the $27.5 
billion appropriated by Congress. More than $1 billion in new Amtrak 
projects have been approved.
    For public transit, an unprecedented $3.2 billion in grants has 
already been awarded--and another $5 billion is in the pipeline. In 
addition, we are currently reviewing grant applications that seek a 
portion of the $100 million in stimulus funding intended to help 
improve dozens of small shipyards around the country.
    Transportation accounts for roughly 10 percent of the United States 
Gross Domestic Product. The investments we make in this sector--and the 
jobs we protect or create--are enormously important to our economic 
recovery. To be sure, it is difficult to know the counterfactual. But 
there are indications that the recovery funds are already having a 
significant impact on state and local budgets and household budgets. 
And it is important to bear in mind that the stimulus plans are being 
implemented over the course of 18 months. As a consequence, the full 
effect of the recovery will not be felt for many more months. The 
Government Accountability Office (GAO) recently reported that the 
recovery funds have helped states avoid major service cuts, tax hikes, 
and widespread layoffs. As I talk to governors, mayors, state 
transportation officials, and private contractors on a weekly basis all 
over the country, there is widespread agreement that without these 
well-timed Federal investments in infrastructure and state services, we 
would probably be in much worse shape.
    I am proud to say that the Department is showing how the Federal 
Government can move quickly, effectively, and ethically to invest in 
good projects and good jobs in every state in the Nation. Even before 
the Recovery Act was enacted, DOT had developed an implementation 
strategy to ensure that the agency would be prepared to implement our 
elements of the legislation as quickly and effectively as possible. We 
brought together an intermodal team of experts from our policy, legal, 
financial, and information technology disciplines to work alongside 
programmatic experts in our operating administrations to anticipate the 
requirements in the new legislation. This new team--termed the 
Transportation Investments Generating Economic Recovery, or TIGER, 
Team--was tasked with coordinating and overseeing the Department's 
responsibilities and reporting regularly to me on their progress.
    The work of the TIGER Team has been instrumental in keeping our 
implementation on track and I am pleased to report that the efforts of 
our TIGER Team and many others throughout our Department have enabled 
the Department to achieve success. To keep the funds flowing and to 
ensure that accountability and transparency are maintained, our DOT 
TIGER Team is tasked with a broad range of responsibilities. We have 
established separate stewardship working groups to coordinate issues 
such as data reporting, financial management, procurement and grants, 
job creation, information technology, and accountability. The reporting 
requirements in the legislation are extraordinary and have required the 
Department to establish guidance on data and financial reporting to 
ensure that information provided to the public is accurate and easy to 
understand. For example, we have posted maps of the United States on 
DOT's Recovery Act website showing the number of projects by State and 
the amount of funds that have been obligated. We are constantly working 
to refine these helpful depictions of the progress being made to 
fulfill the President's objectives for the Recovery Act.
    While implementation of the Recovery Act presents significant 
management challenges, DOT has taken steps through the TIGER Team to 
provide effective oversight to ensure that the funds provided by 
Congress are used efficiently and effectively, and to provide maximum 
benefit to the public.
    For example, DOT has developed a systematic and comprehensive 
approach to risk assessment and management. The risk management tool 
developed by DOT was so well regarded by the Office of Management and 
Budget (OMB) that OMB subsequently adopted the tool for Government-wide 
use. The tool uses a four-step approach, which is built upon the sound 
foundation of internal controls assessments:
    Formal assessment of potential programmatic risks;
    Risk profile that categorizes the level of risk;
    Risk management and mitigation plan; and
    Validation and testing.
    DOT has collaborated with other Federal agencies to share risk 
management best practices and develop a comprehensive standard risk 
assessment tool. The Department has completed three phases of its Risk 
Management Plan for all Recovery Act programs and is currently 
reviewing, validating, and evaluating all of its mitigation efforts. We 
are continuously updating our risk management efforts to ensure that 
Recovery Act dollars are effectively spent.
    We have also created new business processes that make better use of 
the work done by both the Office of Inspector General (OIG) and the 
GAO. Early on, we established an Accountability Executive Board that 
includes top officials from throughout the Department. This group 
approached OIG and GAO seeking to better ensure that audit findings are 
thoroughly considered in our Recovery Act programs. First, we broadened 
the avenues of communication to make certain we had a clear 
understanding of their concerns as rapidly as possible. We created new 
mechanisms, including an Accountability Stewardship Group to bring 
management and the auditors together frequently for a frank, two-way 
exchange of information. Together with the Inspector General, I have 
convened a fraud awareness session broadcast throughout DOT to ensure 
everyone gets the message that we have zero tolerance for waste or 
fraud. Simply put, I have asked our people to say something if they see 
something. The Accountability Executive Board continues working with 
the auditors to identify new and innovative ways that will better 
enable DOT to anticipate challenges and incorporate the changes 
necessary to provide the public with meaningful and effective 
programmatic results.
    To really understand how taxpayers and their communities are 
benefiting, you need a ground-level perspective. In Pennsylvania, for 
example, the Recovery Act has boosted the State's fiscal year 2009 
highway and bridge construction program by more than half--adding over 
$1 billion to the budget. That means more than 200 infrastructure 
projects are funded today that would not even be on the books 
otherwise. It also means that thousands of private-sector jobs will be 
saved or created, lay-offs will be avoided, and that Pennsylvania can 
count on good jobs for months to come.
    Consider this: in April, contractors working in Pennsylvania 
reported that stimulus funds helped them sustain or create about 130 
jobs. By May, the total jumped to over 700 jobs. The job totals this 
month will be even bigger.
    In state after state, we are seeing a meaningful impact on jobs. 
The Maryland Department of Transportation has recalled all of its laid-
off employees back to work. A private contractor in Massachusetts has 
brought back nearly its entire workforce--more than 300 people.
    In Missouri, Texas, Colorado, Georgia and elsewhere, this story is 
being repeated. I have personally met with workers around the country 
who would not be getting paid this week without stimulus-funded 
transportation jobs. And because they are working, they can support 
their families, pay their bills, and pump some dollars back into their 
local economy.
    While it will take time for the economy to recover, every single 
job these investments help to protect, every worker who is recalled 
from a layoff, and every new college graduate who finds that crucial 
first job counts as a victory.
    There have been questions about whether stimulus-funded projects 
are in the communities that need them most. We have found that half the 
states have obligated at least half of their recovery highway dollars 
to economically distressed areas. I have urged the Nation's governors 
to spend the funds saved from low bids to highway and transit projects 
in depressed areas, wherever possible.
    Our cities are benefiting too--making sweeping upgrades to transit 
facilities and equipment to help fight congestion, reduce emissions, 
and improve mobility for millions. Ninety percent of recovery funds for 
transit go to urban areas--cities large and small. This means that 
cities like South Bend, Indiana can finally replace a century-old 
transit center with a new multi-modal complex. Minneapolis-St. Paul, 
Fort Worth, and scores of other cities now have tens of millions of 
dollars each to buy clean-fuel buses, build new transit facilities, and 
make deferred repairs.
    I am pleased to note that the Department continues to meet all of 
its deadlines. From the beginning, the FHWA has moved at rapid speed. 
On March 3, 2009, President Obama and Vice President Biden joined me at 
DOT to announce that nearly $26.7 billion was available to the States 
for highway investment. Within hours of the President's announcement, 
states began approving projects--in full compliance with all Federal 
laws and regulations. Just six weeks after approving the first project, 
the President and Vice President returned to DOT on April 13 to 
celebrate the 2000th transportation project approved for funding--
rebuilding a $68 million interchange on I-94 in Portage, Michigan. 
Construction has now started on this project, which the State expects 
will create 900 jobs this summer, increase safety, and reduce 
congestion along one of Michigan's most important freight corridors.
    Under the Recovery Act, 50 percent of the funds apportioned to a 
State (excluding funds sub-allocated within the State) were required to 
be obligated under a project agreement before June 30, 2009. I am 
pleased to report that all States were able to meet the target by the 
120-day deadline on June 29, which happened to be the 53rd anniversary 
of the Interstate system. A similar requirement is included in the 
Recovery Act for our transit programs. The Recovery Act calls for the 
obligation of 50 percent of transit formula dollars in specific 
geographic areas within 180 days of apportionment, which means by 
September 1, 2009. We are well on our way to meeting that deadline, as 
well.
    I am confident that five years from now, when we look back on the 
American Recovery and Reinvestment Act, we will recognize that the 
investments we made in infrastructure, energy conservation, education, 
and other vital needs marked a turning point. The American people have 
said loud and clear that they want us to rebuild our crumbling roads 
and bridges, and build clean and green public transportation systems to 
help ease traffic congestion. We are putting Americans to work doing 
just that.
    But there is also more to come. The Recovery Act included $8 
billion for a new high speed rail program. President Obama's vision for 
high-speed rail mirrors that of President Eisenhower, the father of the 
interstate highway system, which revolutionized the way Americans 
traveled. Now, high-speed rail has the potential to reduce U.S. 
dependence on oil, lower harmful carbon emissions, foster new economic 
development, and give travelers more choices when it comes to moving 
around the country. The Recovery Act also included a $1.5 billion 
discretionary grant program for surface transportation to be 
administered under my direction. These ``TIGER'' grants will be awarded 
on a competitive basis for capital investments in surface 
transportation infrastructure projects that will have a significant 
impact on the Nation, a metropolitan area, or a region. In the months 
ahead, we will also work with Congress to find creative new ways to 
finance the kinds of transportation systems and services that Americans 
need and deserve for the 21st century.
    In closing, I firmly believe that the American Recovery and 
Reinvestment Act is working, it is on track, and it will continue to 
benefit our communities for many, many months. I can tell you that we 
are making real progress in achieving the goals of the Recovery Act. I 
have had the privilege of standing along side the President and the 
Vice President at events marking the arrival of Recovery Act funds in 
cities throughout America. I have seen first hand the excitement on the 
faces of newly hired workers who now have a job. These people have 
families to care for and communities that are counting on them. In 
turn, they are helping to rebuild and refurbish our transportation 
infrastructure so we can together keep America moving.
    I again want to thank Chairman Spratt and the Members of the 
Committee for inviting me here today. I will be happy to answer your 
questions.

    Chairman Spratt. Thank you all. Let me just review the 
bidding, so to speak. The Recovery Act provided $787 billion in 
spending and in tax relief; $183 billion of that has been 
obligated as of July 10th, which means 28.8 percent has been 
obligated--nearly a third, nearly 30 percent. And you gave 
powerful testimony, each one of you with concrete evidence and 
anecdotal illustrations. This is a fact that this is working 
and if it we had not done it, we would be suffering severe 
consequences, maybe even catastrophic conditions.
    But in Main Street America, people are still saying, ``I 
don't see the relief yet, I don't feel it.'' When can we tell 
the American people that more benefits and more effects of the 
Recovery Act are going to be felt and seen and in their daily 
lives, and their jobs, and in their work and things of this 
nature? Can you give us any sort of expectation like that, that 
we can carry back to our constituents?
    Secretary Salazar. Mr. Chairman, I would say that first of 
all, we are already seeing the effects on the ground through 
the illustrations that I and my colleagues have provided. There 
are already people working who would not otherwise be working 
if the Congress not taken the action that it took and the 
President's leadership had not resulted in the stimulus 
package. So I think the effects are already seen on the ground.
    Secondly, the Recovery Act is a program that was supposed 
to work over time. It was not supposed to essentially be a 
magic wand that from one day to another would take the economy 
out of the deep ditch which it had gotten into. The Congress 
rightfully set forth a longer term program--over 18 months--to 
get the money out. And so you will see jobs created during that 
time period, but also into the future. In our own process in 
the Department of Interior we recognize the contracts that we 
are letting out will have people employed now and into the 
future. That is a very positive economic impact of these 
investments: they will create jobs in the long-term.
    The kind of projects that we are investing in are going to 
create a part of the economic engine for 10, 15, 20 years on 
down the road. But I think the American people will see the 
effects over the next couple of years in a very significant 
way.
    Chairman Spratt. Thank you. Secretary Vilsack?
    Secretary Vilsack. Mr. Chairman, I would start by saying 
that 33 million Americans are today receiving the benefits of 
increased SNAP payments and food assistance payments. As I 
indicated in my testimony, a family of four on average will get 
about $80 more to be able to spend in a grocery store. And 
because it generates economic activity by virtue of the fact 
that about 97 percent of those resources are spent in the first 
30 days, it means more grocery items have to be stocked, more 
have to be trucked, more have to be processed, more product has 
to be sold in order to be able to process the additional food 
that is being purchased. So 33 million Americans are getting 
benefits right now and have been for the last several months.
    I would also say that if you spend any time at all in food 
banks, as I have, you will see that the additional emergency 
food assistance that the Recovery Act provided is really 
helping a lot of families have nutritious meals, particularly 
for America's children. We have, unfortunately, still today in 
this country, 600,000 of our children who are hungry. These 
food banks make a big difference in the lives of those 
youngsters.
    Third, I would say that when you are looking at several 
hundred community facility projects, the projects are for the 
most part construction projects that are putting people to 
work. The chances are very good these are local contractors, 
they are expanding libraries, they are building daycare 
centers, or they are working on expanding health care 
facilities in rural communities.
    At the same time those activities are taking place, several 
thousand people are already working today on the forest service 
projects, and roughly 3,700 folks are employed because of the 
watershed work that we are doing in the water treatment plants 
that we are building. In those communities--and there are 
roughly 40 States impacted by these benefits--in those 40 
States when people turn on the tap in many of these communities 
they will have clean drinking water.
    So while there will be time for additional jobs being 
created as a result of our investments, I think it is important 
to see this Recovery Act in three components. First, it is 
allowing people to transition through tough times. That is why 
you extend unemployment benefits, that is why you provide tax 
relief to 95 percent of working families, and that is why you 
increase SNAP benefits through the Recovery Act.
    At the same time, we are doing the work that Americans want 
done: they want their roads improved, they want bridges to be 
safe, they want dams to hold the water, and they want to 
improve their community facilities in rural areas. That is 
taking place, and it will continue to take place for the next 
15 months.
    Third, Americans understand that we owe it to our children 
and grandchildren to build the foundation for a 21st century 
economy, which is why high-speed rail, the broadband 
initiative,and the smart grid investments will be made and will 
build a much stronger, long-term economy for this country. So 
it will take some time for folks to see unemployment rates 
drop, but the fact is that the stock market stabilized and 
credit is a bit more available. The fact that there is a better 
attitude in terms of the long term I think is a reflection of 
the some of the work the Recovery Act has done.
    Chairman Spratt. Mr. LaHood, I will add this to your 
question: Do you think that we undersold the potential of 
boosting expenditures and highway projects--in particular 
surface transportation projects? I think there was a request 
for $32 billion and the amount that finally came through was 
$28 billion--there was some dispute over whether or not the 
highway money could be put to quick use with shovel-ready 
projects. Do you think we undersold the potential of the 
highway investments?
    Secretary LaHood. Well, Mr. Chairman, the reality is that 
much of this money is out the door. As I said, I have been to 
24 States and 41 cities around the country. And everywhere I 
go, I see orange cones all over America, and I see thousands of 
people working, and I talk to these people. All of these people 
that I talk to, without exception, were on unemployment in 
January and February and March, and they are working today. 
They are building roads and they are building bridges, they are 
building runways and airports. Every airport that I have flown 
into has taken advantage of the billion dollars that is now out 
the door, and they are resurfacing runways and resurfacing 
roads.
    Part of the problem for us at DOT is that we said we wanted 
projects that were ready to go. Well, in order to have the 
State spend money, the legislature had to--in some instances--
appropriate the money for the project, and some legislatures 
have taken time doing that. Other legislatures had to pass 
capital budgets: in the instance of Illinois, the governor just 
signed the match money for some projects under TEA-LU.
    Now, there was no match under the Recovery Act. So whatever 
delays were caused, were caused by the fact that legislatures 
in some States wanted to have their say on how our money was 
going to be spent. But there are a lot of projects going on in 
America. And there is a lot of money out the door--over $20 
billion is out the door--and almost 7,000 projects are funded, 
and many of them are underway.
    I just met with some folks with the Michigan delegation 
where they don't have the kind of match money that they need 
for some of these projects under the TEA-LU bill. And we 
figured out a way to help them. So in instances where States 
have had difficulty, we have worked with them, and I believe we 
have made a difference. I believe that if you look around your 
districts, and I say this to every member, and you go to these 
projects, and you talk to people that are working, what they'll 
tell you is they were on an unemployment roll in January and 
February. And now they can make their house payment, make their 
car payment, and put food on the table for their families. That 
could not have happened without these funds. And I thank 
Congress for having the courage to pass this kind of 
opportunity for America. We are putting people to work.
    Chairman Spratt. Thank you very much. Mr. Ryan.
    Mr. Ryan. Thank you, Chairman. In Janesville, Wisconsin, 
which is my hometown and the town I represent, the unemployment 
rate is 13.2 percent. It is just about at that level in every 
other county I represent. So we all want to get this right. 
This is the worst we have seen in most of our lifetimes, so 
getting the stimulus and getting the recovery right really 
matters. That is why some of us are concerned that we are not 
applying the right medicine at the right time to the economy to 
get jobs growing. That is why we are concerned about the 
forecast of many economists that we will have a jobless 
recovery. That is why we are also very concerned that even 
though the stimulus is starting to possibly--maybe--kick in, 
right around the corner at the end of next year, massive tax 
increases are already coming into law. Tax increases on 
investment capital, tax increases on workers, tax increases on 
small business.
    And now we have a proposal that we may voting on next week 
that is going to put even more tax increases on small 
businesses bringing tax rate up above 50 percent. And so, we 
think that the fiscal policy coming out of Congress just, 
candidly, is the wrong fiscal policy.
    A week ago, I went over to the Bureau of Public Debt. Now 
Mrs. Lummis and I did this. And we spent about 5 minutes 
watching smart employees at the Treasury Department in a room 
with a bunch of flat screen TVs, sipping coffee, borrowing $40 
billion in about 4 minutes. And we are doing this every day at 
the Treasury Department. And we are being told by economists, 
by bond traders, there will come a day where we can't keep 
borrowing all this money. There is going to come a day where we 
will not be able to fill a bond sale or there is going to come 
a day where our financiers--48 percent of whom are foreign 
governments, namely China and Japan--they aren't going to do 
it. And so doing this on all this borrowed money has its 
limitation. And so that is a real concern that we have on this 
side of the aisle. Given that we were led to believe that this 
would cap our unemployment at 8 percent, now we are at 9.5 and 
going to 10, we are worried that this is not working.
    I just have a quick question for each of the three of you. 
Secretary Salazar, one of the areas where we think we can get 
shovel-ready projects, where we think we can get good jobs, and 
one of the concerns we have with the Federal Reserve and what 
it's doing is we are fueling another commodity bubble. That 
means we are going to have higher oil and gas prices around the 
corner just like we had a year ago, which will dampen economic 
activity. We have got trillions of cubic feet of natural gas 
and billions of barrels of oil on our country, under our own 
grounds, most of which are Federal lands. Will the 
administration--whether it is the intermountain region for gas 
and oil, outer continental shelf or Alaska--will the 
administration this year lift the moratorium on this drilling 
and accelerate and move toward increasing the leasing so we can 
drill for oil and gas in our own country, create all those 
jobs, and try and reduce not only our dependency on foreign 
oil, but keep prices low?
    Secretary Salazar. Thank you very much, Ranking Member 
Ryan. Let me first say on your comment with respect to the debt 
issue, the fact of the matter is this is a challenge which was 
inherited by President Obama and this Congress.
    Mr. Ryan. Absolutely.
    Secretary Salazar. You were here at the time and you 
remember the conversations about the mountain of debt that was 
being created as Medicare Part D was passed and other actions 
that were taken that created this mountain of debt.
    Mr. Ryan. If you bring that up, Mr. Secretary, I will 
simply add we just passed a budget resolution, the President's 
budget resolution that triples that debt in the next 10 years.
    Secretary Salazar. And I will just say to all of you here, 
I think it is an opportunity for this Nation to come together 
and address the fiscal reality that we have to face, because it 
has been ignored for far too long. And as you heard from the 
President as he was in Ohio yesterday and other places, he is 
focused on making sure that we have accountability and that we 
address the fiscal challenge, including the huge deficits that 
have been built up. So it is something that is very much on the 
mind of the President and on the mind of the administration.
    With respect to your question on energy, we are working and 
have been working hard on the comprehensive energy plan. We 
don't believe there is a one-way highway to energy independence 
in America. I think that one-way highway has proven to be a 
wrong highway. And the consequence of that has made America 
vulnerable to the dangers of over-dependence on foreign oil: to 
the dangers of pollution to our children, and has threatened 
the economy of our country because of the fact that we export 
so many dollars to bring in oil from places like the Middle 
East and other places. So what we have been doing is working as 
a team, people like Secretary LaHood and Vilsack and the whole 
host of us in the government, to develop the President's vision 
for a comprehensive energy plan. And you will see in that, 
Congressman Ryan, that there have been production components of 
what we are doing. We continue to lease vast swaths of land, 
over 1.5 million acres of land on BLM, for oil and gas 
production. We have held leases in the Gulf of Mexico, over a 
million acres have been leased, and we continue to look at 
opportunities for development.
    So we will have a comprehensive plan that includes our 
conventional resources, but also at the same time charts a new 
beginning with renewable energy that really addresses the new 
energy frontier that ultimately will address these long term 
systemic challenges.
    Mr. Ryan. I want to be kind with time. Just real quick 
again, on the remaining moratorium, the lands that are 
prohibited, will the administration in this comprehensive 
energy plan work to lift the moratoriums on those current lands 
that are now prohibited from drilling?
    Secretary Salazar. We are looking very comprehensively at 
the Outer Continental Shelf and areas that are under existing 
moratoria and those areas where the moratoria was lifted. And 
under the plan that we have in place we have provided until 
September 20th for public comment on places that are 
appropriate for drilling and for exploration and for those that 
are not.
    Mr. Ryan. Haven't decided yet basically, is that a have-
not-decided-yet answer?
    Secretary Salazar. The answer is that there are places 
where the debate has been a very theoretical and hypothetical 
debate in large part because we don't have the information to 
make decisions; for example, off the Atlantic. And so we are 
being thoughtful as we move forward, and the time that we have 
taken through September 20th will help us make sure that we are 
drilling in the right places.
    Mr. Ryan. Okay, so stay tuned, you are saying?
    Secretary Salazar. Stay tuned.
    Mr. Ryan. Secretary Vilsack, you come from Iowa, I come 
from southern Wisconsin. We have similar agricultural 
economies, so I feel like you can relate to the kind of economy 
we have agriculturally. The administration had what I thought 
was a very good proposal in its budget to phase out direct 
payments from farmers with gross sales over $500,000. That 
would produce $9.7 billion in savings over 10 years. Mr. 
Blumenauer and I here on the Budget Committee tried to pass 
that amendment, but we failed to do that in the budget 
resolution. I encourage you to continue advancing these things 
because we have to find savings. What is the administration's 
proposal to continue on this? And have you had other success in 
other committees such as the Agriculture Committee?
    Secretary Vilsack. Representative Ryan, we are working very 
hard with the Treasury Department to try to make sure that we 
first and foremost ensure that the payments that are to be 
received are received by those who are entitled to them. As you 
probably know, there were anecdotal reports of people who were 
not farmers receiving payments. We are working with the IRS and 
we hope to be able to ensure and verify that people receiving 
payments are in fact entitled to them, and we think there will 
be savings there.
    We are in the process of taking a look at a number of other 
ways in which there could potentially be savings. This year is 
the year in which we will be discussing crop insurance and the 
deal that we have with insurance companies. We think that that 
deal needs to be examined and looked at so that taxpayers 
receive a fair shake and so that farmers receive a fair shake. 
So there are opportunities there as well.
    So we are continuing to look for ways in which we can do a 
better job of shepherding the taxpayer money. The President 
challenged his departments to begin that process with $100 
million challenge. I can tell you that at USDA, just in our 
Department alone, we can meet about a third of that challenge 
in just the first 60 days in terms of resources that we are 
saving and resources that we are not spending as had been 
planned.
    Mr. Ryan. I know we are mid farm bill, but the proposal was 
made mid farm bill to cap direct payments over 500,000 AGI. I 
just want to get clear, because I support this, I think you are 
going in the right direction. Are you going to be advancing the 
proposal in the next budget submission?
    Secretary Vilsack. There have been criticisms about the 
format and we are going to continue to work with folks to look 
for ways in which we can ensure the assistance and the safety 
net that farmers rely on and depend on, and clearly we have 
seen a substantial need for it this year. You mentioned your 
State of Wisconsin--I was in Wisconsin recently and as you well 
know there is a serious problem with dairy farmers in this 
State.
    Mr. Ryan. Yep.
    Secretary Vilsack. And we have been actually spending a 
great deal of time trying to figure out how to help and assist 
them. I would ask you, since we are sort of neighbors, you 
might be helpful to us in terms of being able to respond to 
those kinds of crises if you gave us a little more flexibility 
in terms of section 32.
    Mr. Ryan. Good point.
    Secretary Vilsack. If you didn't direct quite as much of it 
and gave us a little more flexibility, we might be able to have 
responded even more effectively than we have.
    Mr. Ryan. That's a good suggestion. Ray--Secretary LaHood. 
I am comforted you are in this job, because I know you are a 
man of great integrity who is going to watch how we spend our 
dollars wisely in transportation. I support the highway program 
and it is important to our State. The Highway Trust Fund was 
intended to be user financed and that was the original idea. 
And I think most people support that concept. But it is broken 
and needs to be fixed. Last year we transferred $8 billion from 
the general funds to patach last year's shortfall. We provided 
$27 billion in stimulus funds to the general fund. Now the 
Highway Trust Fund needs another $20 billion.
    We have two seasons in Wisconsin, winter and road 
construction season. So timing of these fixes really actually 
matters. So what is the administration's proposal to fix this 
problem, what is the timing in your mind, and do you support 
general fund financing of the highway program?
    Secretary LaHood. Well, we have put forth a proposal to the 
leadership to extend the current highway bill for 18 months, 
which we believe would cost $20 billion. And we have told 
Congress that we would find the money and pay for it. So we are 
not for the idea of just taking money from the general fund and 
lopping it over into the Highway Trust Fund. We think we should 
pay for it.
    The Senate has passed that extension. There are three 
committees of jurisdiction in the Senate, and all three of 
those committees have passed that. We are looking now to the 
House to do the same thing.
    We think the idea that Congress could pass a very 
comprehensive, robust transportation bill by the time this one 
expires is just not possible. You all know it is not possible 
to do it by September 30th. So rather than doing these 3-month 
or 6-month or whatever extensions and just kind of leading 
people along here that we are going to get somewhere,we think 
an 18-month extension gives us a chance to work with all of you 
on a very robust bill that helps us find the resources. Not 
only use the Highway Trust Fund, which is deficient--I wouldn't 
call it broke, it is deficient, though. Because people are 
driving less, they are driving more fuel-efficient cars and so 
not as much money is going into the trust fund. And we have 
offered some sort of ``think outside the box'' ways of paying 
for our roads and bridges, including tolling, including the 
infrastructure bank, including public-private partnerships, and 
some other mechanisms for using the Highway Trust Fund. Our 
idea, which we think is a good one, is giving us an 18-month 
extension, we will find the $20 billion to plug it--we are not 
going to transfer money from one fund into another to do it. 
And that gets us to the opportunity really to work with all of 
you on a very good comprehensive transportation bill.
    Mr. Ryan. All right, thank you.
    Chairman Spratt. We have a vote on as you can see, and I am 
going to miss the first vote just so we can keep going, but the 
second vote we will recess so that we can go vote and cast four 
votes, I believe. I understand, Mr. Salazar, you may need to 
leave by 11:30, and if so, we appreciate you coming. If our 
other two witnesses could stay with us until we return, we will 
make available some office space to you so you can make use of 
the time. We thank you very much and those of you who been in 
Congress understand the situation, I am sure.
    Now Mr. Doggett.
    Mr. Doggett. Thank you, Mr. Chairman, and thanks to each of 
you. You have had about 6 months to clean up a great mess that 
took years to accumulate. And some of those who have had little 
to say about this economic Recovery Act but varying forms of 
the phrase ``no, never'' are ironically now complaining both 
that we are spending too much money in Washington, but we are 
not spending it fast enough. I think that you and your 
employees could stand at the front door with shovels, I guess, 
and shovel out government money as fast as you could. And when 
you listen to some of these taped cable shows, people are given 
the impression that is exactly what you are doing. That, of 
course, would be outrageous.
    And I salute you for your efforts to see that we not only 
speed economic recovery, but we do it in a way where we are 
accountable to the taxpayers. I want to encourage you to 
continue spending that money as quickly as you prudently can, 
but spending it as if every one of those dollars was coming out 
of your personal wallet. I think if we do that, we will get 
economic recovery and we'll be responsible to the taxpayer.
    Secretary Vilsack, I want to talk with you about what is 
the near-crisis situation we have in central Texas. I have 
farmers and ranchers in a number of counties there that are 
suffering from what is almost 2 feet low in the amount of 
rainfall. It is a very serious drought. I just had 
communication while we were here in the hearing from Judge 
Ronnie McDonald in Bastrop talking about the widespread and 
serious injury and damage to farmers and ranchers is his 
county. I know the same is true in Caldwell, in Gonzales, and 
Fayette and Lavaca counties. Day after day where the only 
question is whether the temperature will be hot or hotter in 
100-degree-plus weather just 1 day after another. In Colorado 
County, some of our rice fields are about to dry up because of 
such a shortage of water. It is estimated that already across 
the State of Texas, we have over $3 billion of agricultural 
losses. It was to anticipate problems of this nature which 
could strike Iowa or Texas or Arizona or any other part of the 
country that we enacted the provisions of the Farm Bill last 
year. And I would just ask you to recognize how urgent the 
problem is in central Texas and to tell us a little bit under 
the SURE program, under livestock forge program, when our 
farmers and ranchers can expect relief and what form it will 
take.
    Secretary Vilsack. Representative, we are certainly acutely 
aware of the situation in Texas. We have received 
correspondence from your office and from the office of a number 
of Members of Congress, as well as the Governor. A number of 
counties, I suspect, I don't know, but a number of counties 
that you mentioned probably already have been declared disaster 
areas.
    Mr. Doggett. They have been.
    Secretary Vilsack. By virtue of what action the President 
has taken and by virtue of the action that I have taken, I will 
tell you that we just recently concluded the rule-making 
process on the livestock indemnity program that is available 
for livestock operators who have been devastated by disaster. 
And I know that payments were actually beginning to be made 
from that program immediately after the rules were promulgated.
    Mr. Doggett. So a rancher who has a livestock forage loss, 
as just about everyone in my area does, they can go now through 
their local farm service agency and make an application and 
begin to receive payments?
    Secretary Vilsack. There are a number of different 
livestock and disaster programs. The forage program still in 
the process of rule making. We anticipate that being concluded 
this summer. And so opportunities will be available under that 
specific program as it relates to forage, most likely this 
fall, but if they fit within the LIP program they can begin 
making application today.
    As it relates to the SURE program, which is a more general 
disaster relief program that Congress saw fit to create in the 
Farm Bill, we were somewhat pushed back on our timetable 
because of steps taken within the Recovery Act that altered the 
calculations that would have to be made. We anticipate the 
rules being completed on SURE this fall. The calculations and 
data that will be required in order to calculate payments will 
be available this fall and we anticipate later this year, the 
first part of next year payments being made under SURE.
    Mr. Doggett. I believe that under livestock compensation 
program, previously you got 1 month of feed losses, now you 
will get 3 months based on the price of corn, which I believe 
has been rising. Does that mean that farmers and ranchers who 
are eligible under that program can expect to get as much as 3 
times what they would have gotten previously?
    Secretary Vilsack. Well, I think they can expect to 
hopefully get what they need to basically transition to better 
times so that they can stay in business. Our goal with these 
disaster programs is to keep people in business, not to force 
them out. I might also add that to the extent that those 
farmers may have a direct operating loan with the Farm Service 
Administration we have asked our farm service administrators 
throughout the country to take a very close look at refinancing 
possibilities, extending payment periods of time. This is 
particularly true for dairy farmers as well, taking a look at 
interest rates that could be reduced, payments that could be 
reduced or deferred in an effort to try to make sure we are 
providing as much assistance and help as we possibly can.
    Finally, we are continuing to encourage our institutional 
purchasers of commodities and goods to continue looking at 
areas where there are problems to see if we can boost the 
market rates a little bit to help those who are struggling.
    Mr. Doggett. Thank you so much for your leadership. We do 
have really a crisis situation, and I hope you will be spurring 
along all of your employees to try to address it.
    Chairman Spratt. Mr. Nunes.
    Mr. Nunes. Thank you, Mr. Chairman. Mr. LaHood, it is 
always a pleasure to see you. Congratulations on your new post. 
Mr. Vilsack, congratulations to you also and I want to thank 
the work that you are doing with Chairman Peterson to help out 
the Nation's dairy industry, and I appreciate the comments you 
have already made on that. And Mr. Salazar, great to see you 
again.
    I want to draw your attention to the slide up here, this is 
the State that you guys would all recognize as the State of 
California. And as you are probably aware, there is a 
government imposed drought that has been occurring here where 
we have lost 40,000 jobs. This is an area the size of the State 
of Rhode Island that out of production, either been abandoned 
fallowed. The unemployment in this area is close to 20 percent 
with some enclaves as high as 40 percent or even higher.
    Mr. Salazar, you visited this area on April 15th to tour 
the economic devastation. And on your visit you announced $260 
million in stimulus funds. And I will quote from your press 
release, ``To mitigate the effects of the devastating drought 
that California is currently experiencing.'' Mr. Secretary, we 
have talked about this before, but there is not a drought in 
California. We have had 95 percent of average rainfall. What we 
have is a man-made government-imposed drought because of the 
Endangered Species Act as you are well aware.
    Mr. Nunes. But you did take some action, and you provided 
Recovery Act funding.
    And I would like to draw your attention to the next slide. 
As you can see on the monitor, the X's mark where the stimulus 
funds went to, and you can see that those X's are nowhere close 
to where the 40,000 jobs have been lost. After this was 
sprinkled over Northern California for environmental purposes, 
the crisis got worse in the San Joaquin Valley.
    And, Mr. Salazar, you returned June 28 to hold a town hall 
with the victims of this manmade catastrophe.
    I would like to show you the next slide.
    You issued another $130 million in stimulus funds, and 
according to your testimony today, the funds were for water-
reuse projects with the goal to help alleviate some of the 
devastation in the region. You can see that where the X's are, 
that we still have no stimulus money. In full disclosure, your 
press release also included $20 million for small water 
infrastructure projects and $40 million in drought relief. They 
are not reflected on this map because we don't know where the 
money went to.
    Mr. Secretary, in your testimony, you said, ``Over the next 
18 months, we will begin approximately $1.8 billion in work, 
creating at least 19,000 jobs.''
    Mr. Salazar, it doesn't take stimulus money to put 40,000 
people back to work. As you know, all we have to do is get 
these pumps on and get water back to the San Joaquin Valley. It 
is free. It doesn't take a dime. So I would ask one question of 
you; simply, you know the situation with the biological 
opinion. So I am going to ask a very specific question. And 
that is, do you plan at this time to conduct a reconsult on the 
Delta smelt biological opinion that will put folks back to 
work?
    Secretary Salazar. Congressman Nunes, first let me say, I 
appreciate your passion and your desire to address this issue 
which is causing a lot of pain in Central Valley in California.
    I am fully aware of it. I have been in the area twice, 
including with Governor Schwarzenegger in a meeting that we had 
with you and other Members of the Congress in Fresno.
    There really are two things that we have to do. First, we 
have to take some short-term action, including dealing with 
some of the projects that you and others here have suggested, 
and we are trying to move those forward as expeditiously as we 
can.
    And, secondly, we have to look at the long-term issue in 
California relative to water supply. We have a system which was 
built for 18 million people, and actually California now has 
over 30 million people. And we have the kind of challenges 
there that really requires us to take a systemic view of the 
water supply and the other demands that are creating the major 
problem that we are encountering.
    With respect to the Recovery Act dollars going into 
California, if Governor Schwarzenegger would not want to take 
these monies, he might have that option, although I think it 
would be in the best people of California. We have $220 million 
for California----
    Mr. Nunes. Mr. Salazar, I apologize, but I have to 
interrupt because I know your time is limited, and we have to 
go.
    But Mr. Vilsack, I just want to ask one simple question to 
you. You are a farm guy from a farm State. Is it possible to 
grow crops in Iowa without water?
    You know the answer is no. I want to yield my remaining 
time to Mrs. Lummis who has a question for you, Mr. Salazar.
    Mrs. Lummis. Thank you, Mr. Nunes.
    Mr. Salazar, one quick question on behalf of the Natural 
Resources Committee Republicans. We haven't seen you yet in 
front of that committee, and we would love to have you come and 
visit with us about how stimulus money is being spent and other 
issues. Can you tell me today whether you would be willing to 
come and testify in front of the Natural Resources Committee?
    Secretary Salazar. The answer to that is yes.
    And I would be remiss if I didn't say that I have worked 
closely with Chairman Rahall and will continue to work closely 
with him. And if he were to request of me to come before the 
committee, I would be honored to do so.
    Mrs. Lummis. Thank you very much.
    I thank the gentleman for yielding. And I also want to add 
my concern about the situation in the San Joaquin Valley. There 
are rare, and I do mean rare, circumstances where the 
Endangered Species Act should not be allowed to destroy 
people's lives, destroy them. And that is happening in the San 
Joaquin Valley.
    I am a person who has a State that is very impacted by the 
Endangered Species Act, including wolves and humpback chubs and 
other species. But nothing we are experiencing in Wyoming is as 
bad as what I see in the San Joaquin Valley.
    And I do agree with Mr. Nunes that there have to be 
alternatives to this manmade drought in the San Joaquin Valley.
    I thank you for your time, Secretary Salazar.
    I will be back after we vote, Mr. Vilsack and Mr. LaHood, 
to ask you questions as well.
    And I want to thank all three of you very much for 
appearing before the committee today.
    Secretary Salazar. Thank you.
    May I, Mr. Chairman, just respond for purposes of the 
record?
    Mr. McGovern [presiding]. Absolutely.
    Secretary Salazar. Mrs. Lummis, both you and Congressman 
Nunes put the label on this as a manmade drought.
    I beg to differ. We have been seeing very significant 
changes in water supply in California, including changes in 
precipitation and timing of precipitation. So this is an issue 
which has been going on for several years, and it has gotten 
worse over time. We are all hands on deck trying to figure out 
a solution to the problem.
    But at the end of the day, as I have said to Mr. Nunes on 
several occasions, we need to figure out a way of moving 
forward together. And, frankly, labeling in terms of ``manmade 
drought versus reality'' is, frankly, not helpful to us. We 
have got to come together because there are a lot of people who 
are suffering in the San Joaquin Valley, as you say.
    Mrs. Lummis. Mr. Chairman, I will pass your comments on to 
Mr. Nunes. And I thank you very much for being here.
    Secretary Salazar. Thank you.
    Mr. McGovern. I have a couple of quick questions before we 
recess for these votes. I am going to take advantage of the 
fact that I got put in the Chair. As a Representative from 
Massachusetts, I have seen the stimulus work. I have seen what 
the Reinvestment and Recovery Act has done. We are seeing more 
infrastructure projects being created and being built.
    And in my home City of Worcester, for example, I will give 
you just one example. The recovery money that has come for 
education alone has prevented the layoffs of over 500 teachers 
and support staff. Now, you don't get any credit for averting a 
disaster, but the bottom line is that my City of Worcester, 
Massachusetts, would have been devastated if that recovery 
money had not come. And of all the cities and towns I 
represent, the same thing is true.
    What would have been the impact if you fired and laid off 
500 teachers and support staff in the second largest city of 
Massachusetts? You would have had larger class sizes. The 
quality of our education would have suffered. It would have 
been a disaster.
    The same for our law enforcement, our parks, and so many 
other things. So, I think maybe there is a problem with 
messaging here or maybe we are not crowing enough about the 
fact that some things are actually happening. But I think 
people need to understand that, without this stimulus package--
and I think Secretary LaHood put it very clearly--you would 
have a lot more people unemployed and the state of the economy 
would be much worse.
    I just have two quick questions, one first for Secretary 
Vilsack. As Chairman Spratt made clear at the beginning of this 
hearing, the economy was broken when President Obama took 
office, and it has taken an enormous toll on jobs and families. 
And because so many family circumstances have taken a turn for 
the worse, many more now qualify for Federal benefits like 
unemployment insurance, food stamps, and school meals. We have 
seen the numbers of people participating in the food stamp 
program climbing. In April of this year, 34 million people were 
on food stamps. That includes one in four children in the 
United States, a 20 percent climb over last year.
    Now, I would think that this means millions more children 
are now eligible for free or reduced-price school meals but we 
haven't seen a rapid growth in those programs. Since all 
children on food stamps automatically qualify for reduced-price 
or free school meals, I would have expected to see an increase. 
And I wonder if the many families who are new to receiving 
unemployment benefits or food stamps might not be aware that 
their kids are also eligible for free or reduced-price school 
meals.
    So my question is, can you tell me what steps the 
administration is taking to educate parents who may be recently 
unemployed or new applicants to food stamps about the free and 
reduced-price school meals program? And is there going to be an 
outreach campaign in the coming year to make sure that all 
eligible children are enrolled? And since we expect 
unemployment to continue to rise, how is the USDA working with 
States and with schools every month in an ongoing way to make 
sure that we reach newly eligible children with this benefit?
    I raise this question because, my two sisters are school 
teachers, and sometimes kids come to school and they don't eat. 
You can't learn with a hungry stomach. And so I am curious to 
have an answer to that question.
    But let me ask my other question to Secretary LaHood and 
then we can recess here. It is great to see you back, and we 
miss you in Congress. We miss your civility in particular.
    But, Mr. Secretary, as you know the Commuter Benefits 
Equity Act was included in the Recovery Act, and the provision 
increased the monthly limit of transportation fringe benefits 
to $230, making it on par with the parking benefit for the next 
2 years. This helps get people out of their cars and into mass 
transit, provides families with much-needed relief in their 
commuting costs, and gives local companies a new benefit as a 
recruiting tool.
    So as we continue to invest heavily in rail and public 
transportation, and this stimulus package does provide that, do 
you think the Commuter Benefit Equity Act should be made 
permanent? And, do you have any other ideas to provide 
incentives to workers and employers to increase their use of 
public transit?
    Secretary Vilsack. Thank you, Mr. Chairman.
    The USDA is working with States and local communities and 
school districts as well as advocacy groups to make sure that 
the message does indeed get out about the opportunities that 
these programs can provide for families.
    I will tell you that one of the most important recent 
changes we have made in the school nutrition programs is to 
have a direct certification process. As families apply for or 
qualify for TANF, they ultimately qualify their children for 
free and reduced-price lunch. We are making sure that that word 
gets out and that school districts do a good job of providing 
information on the direct certification program. We are 
mandating or requiring schools to provide applications for 
these programs for children when school begins. Many schools, 
in fact most schools, probably have a parent kit. Within that 
parent kit will be information relative to the school nutrition 
programs as well as other assistance programs.
    This February we issued guidance to schools to develop 
strategies, including simplifying the process for allowing 
families to sign up, rapid action on benefit applications, 
conducting direct certification, as I indicated, and 
aggressively encouraging them to focus on outreach efforts.
    Additionally, we are working to make sure that people are 
aware of these programs during the summer. As you know, there 
are summer feeding programs. We are continuing to figure out 
ways and strategies for expanding those opportunities. And we 
can assure you that we are also using every technology tool 
available. Our Web site promotes this. We are developing 
products and programs for schools, online tool kits that make 
it easy for them to develop programs for outreach. So all of 
this is being done.
    Mr. McGovern. I appreciate that.
    Mr. LaHood.
    Secretary LaHood. First, Mr. McGovern, let me say nobody in 
the Congress has provided the leadership you have on hunger and 
the anti-hunger and the coalition that you cochair. You have 
done an extraordinary job in highlighting it every day that you 
are here. And I know of your deep interest in that because I 
served with you on that coalition. So thank you for continuing 
your leadership and being very vigilant about it.
    At our department, people think that I have a lot of power, 
but most everything that gets decided has to be run up 14 
flagpoles before it can be decided.
    I like the idea of the commuter benefit equity program 
because it gets people out of cars. It certainly works in 
cities like Washington, D.C., and other cities. If it was up to 
me--it is a good program, and we are going to do all we can to 
work with you and others in the Congress to promote it as a 
program that goes to everything we talk about in terms of 
livability and creating opportunities for people other than 
just an automobile.
    Mr. McGovern. I appreciate that. And your answer is good 
enough for me. I have always found it somewhat strange that we 
all talk about the need to try to get more people to utilize 
public transportation, and yet we provide more incentives for 
people to drive to work than we do to take public 
transportation. I appreciate your answers. I appreciate you all 
being here.
    Without objection, the committee will stand in recess 
subject to the call of the chair when these votes are over. 
Thank you.
    [Recess.]
    Chairman Spratt [presiding]. I next recognize Mr. Garrett 
of New Jersey.
    Mr. Garrett. Just a couple questions actually. There were 
articles, as I am sure you are aware, in the Washington Post a 
short time back, and it talks about that a Republican proposal 
to halt spending on the Federal stimulus has prompted a 
partisan dustup. It refers to Senator Kyl, who called President 
Obama's economic plan ineffective. And following that, 
apparently several letters were written from the administration 
to the State Governor, and one apparently came from you.
    And in it, as far as I know, you can correct me if I am 
wrong on this, it says to the Governor: If you prefer to 
forfeit the money we are making available to the State, please 
let us know.
    Is that correct? And why would you pick his one State to 
send that letter to?
    Secretary LaHood. It is correct that I did send a letter to 
the Governor. The money from our economic recovery portion is 
going to the States. It is not going through Congress. It goes 
to State DOTs.
    Mr. Garrett. So why did you pick his State? And why 
wouldn't you send it to all the States, saying that one Senator 
doesn't want this spent, so we are going to ask all the 
Senators? Was this just done because you were trying to make 
some political hay out of this situation? Why just pick one 
State?
    Secretary LaHood. Well, because Senator Kyl, who is a 
friend of mine, was on national television on a Sunday talking 
show saying that he thought that the money didn't need to be 
spent, if they couldn't spend the money, then maybe we should 
send the money back to Washington. I just wanted to double 
check with the person who was in charge of the money.
    Senator Kyl is not in charge of the money, Congressman; t 
he Governor is. And I wanted to be sure that the Governor was 
not in the same line of thinking as Senator Kyl. And the reason 
I did it was----
    Mr. Garrett. Well, let me ask you a question.
    Secretary LaHood. Let me finish. I want to answer your 
question.
    Mr. Garrett. It is my time.
    Secretary LaHood. Well, it is your time. Do you want me to 
answer your question or not?
    Mr. Garrett. I will ask the questions, and I will look for 
your answers.
    Secretary LaHood. I haven't answered the one yet.
    Mr. Garrett. Well, why did you just--did he say that he did 
not want the money going to his State?
    Secretary LaHood. He did. That is exactly--if you go back 
and look at the transcript of that program, what he said was 
that we should send this money back, it is not being spent. And 
I wanted to check with the person who is responsible for 
spending the money, the Governor. That is why I sent the 
letter.
    Mr. Garrett. So he only wanted it just spent from his State 
and not any other State.
    Secretary LaHood. He was talking about Arizona.
    Mr. Garrett. When he was saying the money is being used 
ineffectively? He is not talking about the entire--regardless 
of whether he is talking about his State or all the States, is 
it appropriate for a Cabinet Secretary to contact the Governor 
of that State to request whether the money should come back? 
Could you see, if you were sitting on the other side, if you 
were still wearing your hat as a Congressman or a Senator, that 
you could see that as a veiled threat from the administration? 
Would you consider that if you were still a Member of Congress?
    Secretary LaHood. Not at all.
    Mr. Garrett. You wouldn't think that?
    Secretary LaHood. Not at all.
    Mr. Garrett. Should I have any concerns that I even raise 
this that I would get a letter sent to Governor Corzine of New 
Jersey saying, well, the Congressman voted against the stimulus 
and so, therefore, we are wondering whether you want to receive 
the money?
    Secretary LaHood. Congressman, the letter was not sent 
because of anybody's vote. It was sent because of a statement 
that was made on national television about maybe we should send 
the money back. And I wanted to check with the elected official 
in the State that has responsibility. It had nothing to do with 
anybody's vote.
    And, by the way, I have worked very closely with Governor 
Corzine and, as a result, your State, Congressman, has received 
millions of dollars for projects that are putting people to 
work who are working today that were on unemployment in January 
or February. Your Governor has been a real leader in this, by 
the way.
    Mr. Garrett. And so if I make a statement that there is 
legislation out there right now that suggests that the rest of 
the money that has not already been spent should go back to 
Treasury; so if I go out publicly and support that legislation, 
have not voted on it because I probably won't vote--or anybody 
else who supports that type of legislation, make public 
statements--would that lead anybody from the Cabinet----
    Secretary LaHood. Congressman, we don't base our decisions 
on how people vote.
    Mr. Garrett. You do base them by public statements, 
apparently, though.
    Secretary LaHood. I wanted to check to make sure that 
Arizona wanted to spend the money. And, by the way, the next 
day, we allocated over $20 million for their transit program.
    Mr. Garrett. Did anyone else in the administration or 
outside the administration encourage you to write that letter?
    Secretary LaHood. I don't need any encouragement to write 
letters to Governors, Congressman.
    Mr. Garrett. Did anyone inside or outside the 
administration contact you or encourage you to write that 
letter?
    Secretary LaHood. I don't need any encouragement from 
anybody to write letters, Congressman. My job is to work with 
Governors.
    Mr. Garrett. Just answer that question. Did anyone else 
inside or outside the administration encourage you to write 
that letter?
    Secretary LaHood. Congressman, my responsibility is to work 
with Governors----
    Mr. Garrett. Answer the question.
    Secretary LaHood. Let me answer it.
    Mr. Garrett. It is a yes or no. Did anyone in or outside 
the administration encourage you to write that letter?
    Secretary LaHood. I don't need any encouragement.
    Mr. Garrett. Can you answer the question, whether you need 
the encouragement or not----
    Secretary LaHood. I don't need any encouragement.
    Mr. Garrett. Can you answer the question?
    Secretary LaHood. That is my answer.
    Mr. Garrett. Mr. Chairman, would the witness please answer 
the question? Did anyone inside or outside the administration 
encourage you to write that letter? Whether you need the 
encouragement or not, did anyone encourage you to write that 
letter?
    Secretary LaHood. No.
    Mr. Garrett. Did anyone talk to you about writing that 
letter?
    Secretary LaHood. No.
    Mr. Garrett. It was all entirely your decision?
    Secretary LaHood. Congressman--do you want me to answer, or 
do you want to go on? My answer is, we work with Governors all 
the time. That is our job. They are responsible. And so we 
wanted to contact the Governor of Arizona because of what the 
senior Senator or the junior Senator from Arizona had said on 
television.
    Mr. Garrett. Thank you, Mr. Secretary.
    Chairman Spratt. Mrs. Tsongas.
    Ms. Tsongas. Thank you for your testimony and for your hard 
work to help our economy recover and get our country back on 
track.
    We have heard today and will continue to hear claims here 
and in the press that the Recovery Act has failed. And while we 
are not specifically discussing the education funding included 
in the Recovery Act, I did reach out across my district and 
wanted to share with you some quotes from school 
superintendents, because I think they reveal how critical this 
funding has been and will continue to be.
    The superintendent of the Lowell School District, which is 
the largest city that I represent, told us, ``Thank goodness 
for the stimulus, and thank goodness for stimulus money next 
year. Without it, we would have had to cut 120 teachers.'' 120 
teachers represent roughly 10 percent of their teaching staff.
    In Groton Dunstable, a much smaller community, we heard, 
``Without the stimulus funding, we would have had to let eight 
teachers go. With the funding, we were able to keep them.''
    And in Chelmsford, a mid-sized suburb, ``We were able to 
replace outdated textbooks, replace some science equipment, 
train staff, and retain 14 teachers.''
    These communities and many others I have heard from have 
had to make real sacrifices and have suffered deep cuts. And 
while these numbers are not large in and of themselves given 
the tremendous loss in jobs, you can imagine how important they 
are to each community and how, when multiplied across the 
country, what a difference it has made in saving jobs and 
preserving education for our young people.
    Furthermore, for those individuals who have lost their 
jobs, in my district the communities of Lowell, again, and 
Methuen, have unemployment in the double digits; while in 
Lawrence, a mid-sized city, unemployment is over 17 percent, 
almost twice the national average. And unemployment 
compensation, food stamps, and the other forms of nutrition 
assistance funds included in the Recovery Act have been a 
crucial lifeline.
    And I thank you, Secretary Vilsack, for your work in 
getting that funding out.
    But I have a slightly different question. When we passed 
the Recovery Act, we committed to closely monitor the use of 
funds to deter waste, fraud, and abuse. Very important, and we 
in Massachusetts have learned the hard lesson with the Big Dig 
of not closely monitoring how we spend public funds.
    As a result, the Recovery Act has been one of the most 
transparent spending bills passed by Congress. But, 
unfortunately, one side effect of that is that the 
administrative burden required to get recovery funds out 
quickly is very high on local communities and agencies. In 
fact, I have communities who don't even have grant writers.
    What is each of you doing to help overcome this burden, to 
help smaller communities and organizations access these funds 
and help get the money out quickly and efficiently to them as 
well?
    Secretary Vilsack. Representative, I might focus on 
broadband for just a second because I think that is a good 
example in response to your question.
    As you know, USDA and the Commerce Department received 
appropriations for broadband. Rather than having two separate 
applications and creating confusion and more difficulty for 
communities or for the private sector to apply for those 
resources, we worked with the Commerce Department to put out a 
single notice of funds availability, and we worked with the 
Commerce Department to have a single web-based application 
process on broadband.USA. We won't even ask the folks to 
determine whether they want to apply for the USDA or their 
Commerce Department money. We will do this by zip code and by 
virtue of the information that we have. We will make sure it 
gets funneled to the right department. This is one way of 
trying to get resources to people as quickly as possible and to 
have them be able to apply as easily as possible.
    We are also very committed to transparency. We at USDA 
created a geospatial map of the country. You can click on every 
State. You can find out precisely what USDA has been doing and 
what HUD has been doing and other departments are joining as 
well. So, over time, you will have a single U.S. map that will 
allow you to have a sense of all of the projects and where they 
are located.
    Ms. Tsongas. Thank you.
    Secretary LaHood. If you don't mind, Mr. Chairman, if I can 
just respond, because I just want you to know that, in those 
areas where people don't have the ability to have grant writers 
or--some of these areas have access to metropolitan planning 
groups who do have grant writers who can help the communities. 
But in the event there is a community that doesn't have 
anybody, maybe what we could do is try and be helpful to them 
and reach out to them through our offices, and put them in 
touch with people that can be helpful.
    I would think that some of these metropolitan planning 
organizations would have people that could reach out to them, 
and we have relationships with them also. So maybe what we 
should do is get the names of some of these folks and see if we 
can be helpful in identifying people that can help them jump 
through the bureaucratic hoops to access some of these dollars.
    Ms. Tsongas. Well, we have been a resource to them, and 
they have worked with planning agencies. But I was just on the 
floor of the House today talking to a Member from Arizona who 
was saying that in communities who are very isolated, they 
really suffer in many ways, but one is that they just don't 
have the capacity to stay on top of it. And it is obviously our 
role as Members of Congress to do everything we can for our 
communities. But I think it is important that you hear it and 
be aware of it from your point of view.
    Secretary LaHood. Good point. Thank you.
    Chairman Spratt. Mrs. Lummis.
    Mrs. Lummis. Thank you, Mr. Chairman.
    Secretary Vilsack, thank you to coming to the Ag Committee 
earlier this year on several occasions. It was great to have 
your testimony there.
    That said, I do have a bone to pick with you about Forest 
Service stimulus funds.
    As you know, the U.S. Forest Service has so far distributed 
nearly $940 million, or over 80 percent of its total stimulus 
dollars. Of the portion of that spending that has gone to the 
Rocky Mountain region, an almost unnoticeable amount has 
reached our National Forests in Wyoming. The media has asserted 
that Wyoming may be getting punished as our congressional 
delegation all voted against the stimulus bill.
    I am willing to assume that your Department is more above-
board than that, but can you please explain to me and to my 
constituents the disparity between Forest Service stimulus 
dollars in Wyoming compared to our neighboring States?
    Secretary Vilsack. Congresswoman, I would be happy to do 
that. But I should tell you that, as you probably know, we are 
in the process of continuing to make decisions about Forest 
Service projects. And while this is not public, I can tell you 
that I am fairly confident, based on what we have planned, that 
there will be about $6.5 million going to Wyoming in this next 
allocation.
    And the reason why we haven't gotten to Wyoming until now 
is the selection criteria was based on the unemployment 
circumstances and the conditions of the State. And so we ranked 
programs and projects based on the capacity to try to help 
folks get through difficult times.
    Your State, because of the good leadership that it has with 
Governor Freudenthal and others, obviously did not have the 
unemployment rate quite as high as other States, and so we went 
through the process of making sure we got the money to the 
States that were most in need. So but money is coming, as has 
been the case with all of the other programs that I talked 
about earlier. Wyoming, as I look at this, received close to 
$50 million in other stimulus money.
    Mrs. Lummis. Mr. Chairman, I would like to point out that, 
right now, Utah, which has received $12 million in Forest 
monies, has a lower unemployment rate than Wyoming. We have 
more forests, and we have an enormous problem with bark 
beetles. They are projected to destroy between 90 and 100 
percent of the lodge poll pine in southern Wyoming, Northern 
Colorado by 2012. So we are in a desperate situation with 
regard to bark beetles.
    And our unemployment rate now exceeds that of Utah, which 
has received $12 million.
    I am, however, encouraged to hear that we will be receiving 
$6.5 million. Can you tell me when that will occur?
    Secretary Vilsack. I think it is in the process of being 
reviewed by either my staff or OMB, so it should be relatively 
shortly. I should also indicate to you that there were other 
criteria in addition to unemployment: the risk of forest fire; 
the capacity to create and retain sustainable jobs; the 
capacity to use wood-to-energy or biomass projects; the 
opportunity and capacity to create jobs that would contribute 
to greener operations, recreation sites, roads, trails, and 
other facilities. In other words, there were 2,700 projects 
that were submitted to us. We did our best to try to rank them 
based on a variety of criteria.
    I can reassure you that there was absolutely no 
determination relative to votes. Until you told me that you 
voted against the stimulus, I had no idea that that was your 
vote. And, frankly, in terms of my job, I don't care.
    My job is to make sure that these resources are used to 
create jobs, to help people transition from bad times to better 
times, and create that 21st century economy. And we are very 
focused on doing that job.
    Mrs. Lummis. Thank you, Mr. Vilsack. I appreciate that, 
because our press has been suggesting that our votes may have 
had something to do with the fact that Wyoming had not received 
the funds. I am pleased to hear they are coming.
    Briefly, Secretary LaHood, I would just like to make a 
comment. Because Wyoming has 29 people per lane-mile and the 
national average is 128, Wyoming's per capita contribution to 
the highway fund is $314, where the national average 
contribution is it only $109.
    And I want to tell you, I am grateful for the stimulus 
funds we have received for highways in Wyoming. That has been 
an area where we are pleased. But in terms of the long-term 
trust fund issues, I just wanted to suggest to you that because 
of our small population and huge amounts of highways, 
tremendously important economic and transportation corridors, 
and the fact that our small population puts a higher burden per 
lane-mile than other States, that as you are coming up with a 
long-term resolution to the Highway Trust Fund issues, we hope 
you will take that into consideration.
    And I want to thank you for being here, and I want to thank 
you, Mr. Chairman, for holding this hearing.
    Secretary LaHood. Mr. Chairman, let me just say in response 
to the Congresswoman, I know this Highway Trust Fund formula is 
an issue for many, many Members. It was during the time that I 
served, and it continues to be.
    I have talked to both of your Senators from Wyoming about 
this. And I think you will be in a good position, along with 
your Senators, to really work on this as we work through how to 
really make the formula fair.
    I know how important these roads are to States like 
Wyoming. I really do. I mean, they are the lifeline for 
economic development and opportunities, and so we will work 
with you on that.
    Mrs. Lummis. I will look forward to it. Thank you so much.
    Mr. Chairman, thanks a lot for holding this hearing.
    Chairman Spratt. And, Mr. Secretary, you can include me in 
South Carolina among those who would like to see a new formula.
    Mr. Yarmuth from Kentucky.
    Mr. Yarmuth. Thank you, Mr. Chairman.
    Secretaries, thank you very much for being here, and thank 
you for all you have done. I guess you have redefined the term 
``hit the ground running.'' And while you are both experts in 
your respective fields, I know that you didn't count on having 
to jump into this level of activity and this level of response. 
And I know the public officials of my State in Kentucky, both 
parties, are very grateful for the assistance and cooperation 
we have gotten from you.
    I particularly am impressed by the evidence that you have 
provided today about the job creation and the economic stimulus 
that has taken place. There is a lot of cognitive dissonance 
out there right now. And the other day, we sat and listened as 
130 of our Republican colleagues were on the floor repeating 
the mantra: where are the jobs, where are the jobs, where are 
the jobs.
    And you have vividly demonstrated to us today where the 
jobs are. I would like to add one example of that. It didn't 
come from either of your Departments. But directly as a result 
of energy stimulus funds, General Electric's appliance park in 
Louisville, which is the head of their Consumer Products 
Division, has announced that they are bringing back 400 jobs 
from China to manufacture a revolutionary energy-saving water 
heater in our district. It would not have happened without the 
recovery funds that we provided.
    And one other point I would like to make about this, and 
Mr. Garrett talked about possible legislation to rescind part 
of the stimulus funds or recall them back or change it in some 
way, and Mr. Ryan also referenced all these mythical tax 
increases that are going to occur. We never hear much from the 
other side about the tax cuts that were in the Recovery Act 
package, $288 billion. 95 percent of American families are 
receiving about $80 a month, which basically pays for their 
gasoline, for most people. And I wonder if our colleagues on 
the other side would want to rescind that part of the package.
    And so I will ask a question eventually. I think Secretary 
Salazar referred to this, that these jobs are not only jobs for 
this period, but they provide sustaining economic benefit. And 
my question to both of you is, is there any way we could have 
spent the nontax-cut portion of the stimulus money in a way 
that would not only create jobs but that would have more 
effectively created the jobs and provided sustained economic 
benefit for the country?
    Secretary LaHood. Well, I don't know of another way. I 
think when you look at what the President was talking about 
during the campaign, he continued to talk about the idea that 
the quickest way to get people to work is to rebuild the 
infrastructure in America. And it is no secret around here or 
anywhere in America that a lot of our infrastructure had been 
ignored for a long time. There just weren't enough resources. 
Every State was either going broke or didn't have the money. 
And I think we have proven at DOT--if you just look at the 
airport money, $1 billion is out the door. It is spent. And as 
I said, I have been to 24 States in 41 cities. Every city that 
I fly into, there is a runway either being resurfaced, rebuilt, 
or lengthened. That could not have happened.
    And there are people out there working. You go out on the 
highways--and these are real people. These are people that were 
on unemployment, that didn't know whether they were going to 
have a paycheck by June or July. And now they do. I mean, this 
is real results. And it could not have been done any quicker or 
any better.
    And, you know, Congress put some tough deadlines on us, and 
we have met them, thanks to the professional people at DOT, and 
our relationships with airport officials, with highway DOT 
secretaries, with transit officials. We have over $3 billion 
out the door now so people can buy buses. There is a company up 
in St. Cloud, Minnesota, called New Flier Bus Company. They put 
on a third shift because of all the bus orders they have 
received from transit districts that are now ordering buses as 
a result of the stimulus money. There are people building 
buses. And so we see it working all over the country. We really 
do.
    Mr. Yarmuth. Secretary Vilsack, I know you talked about the 
33 million families having increased assistance through the 
SNAP program and so forth and the economic spin-off of that: 
1.84 times the economic benefit. How does that preserve jobs as 
well?
    Secretary Vilsack. Well, if you think about what happens 
with these SNAP payments, they get placed on electronic benefit 
cards. It gives families of four on the average about $80 more 
a month; 97 percent of that $80 is spent in 30 days. So if you 
want to talk about putting money to work quickly, there is no 
better, no quicker way to do it than the food assistance 
program.
    Now, that family goes into the grocery store and purchases 
additional items, which means that grocery store has to stock 
additional items to replace the ones that have been sold. That 
means that they are able to maintain their workforce, and it 
puts a little more money into the grocery store's bottom line. 
So, perhaps in distressed areas, in areas where we are 
concerned about food deserts, grocery stores can make it.
    I was at a ShopRite yesterday in Philadelphia that just got 
started during the toughest economic times, and they are making 
money in large part because of that $80 a month for a family of 
four. And I will tell you, this is a company that employs 2,700 
people.
    Because there has to be more stocked, it means there has to 
be more trucked. That puts trucks on the road. It gives people 
the opportunity to continue transporting goods. If more has to 
be trucked, that means more has to be processed. If more has to 
be processed, that means people have to continue working to 
process that food and to produce it, to can it, to freeze it, 
to whatever. That means that more has to be purchased, and that 
ultimately helps those who are farmers and ranchers, who are 
just extraordinary individuals, because they have the capacity 
to create not just enough food for us but also enough food for 
many, many millions of people around the world.
    So it is a process that basically cascades through the 
economy and does it quickly. It is sort of like an IV bolus of 
Lidocaine if your heart is standing still, that food assistance 
is getting your heart pumping again.
    Mr. Yarmuth. Thank you very much for that. And, again, 
thank you for your service to the country.
    Chairman Spratt. Mr. Schrader.
    Mr. Schrader. Thank you, Mr. Chair.
    I appreciate both of you being here. You are doing 
wonderful work, and this country needs it in the most 
impressive way. Someone at the hearing here had talked about 
meager benefits of the recovery program. And when I look at the 
Department of Transportation's results, as of today looking at 
the Aviation Administration, Secretary, you have talked about 
the billion dollars that is out there, 347 projects, with tons 
of jobs for Americans. The Highway Administration already has 
5,700 some odd jobs in all 50 States, with 64 percent of the 
funds already out the door. I look at the rail division and 
another $1 billion worth of Amtrak grants, which is very big in 
my part of the country, quite frankly.
    I just think this seems to me to be a little bit more than 
meager results. And I am very impressed with how the Department 
of Transportation has put that out there. I appreciate you 
coming to Oregon in particular. And I can speak personally that 
the jobs that are created in my county, the innovation with the 
American street car that is being born, if you will, in my 
State, puts us on a competitive basis that we have never had 
before. It is an innovation that would never have occurred, I 
don't think, without this recovery package.
    If you could comment just briefly on how you are able to 
meet these deadlines. There also has been a lot of talk about 
how government can't do anything right, it is always screwed 
up, it is totally inefficient. I mean, based on the lack of 
fraud you have testified to and the deadlines that you seem to 
be meeting, I think you are doing a heck of a job. Could you 
comment on that?
    Secretary LaHood. Thank you, Congressman. I appreciate 
that.
    And I appreciate the chance to come to your beautiful 
State. And I have told people many, many times as I was riding 
in a vehicle to the event where we inaugurated the street car, 
I saw I would say between 50 and 100 people riding their bikes 
to work. I mean, you are the model for liveable communities. 
You are the model for what I think people around the country 
would like to replicate. And you have been way ahead of the 
curve on so many things. So we have had great fun in your State 
and great opportunities to meet very, very innovative people.
    The way that we have been able to meet all the deadlines, 
beat all the deadlines--not only meet them but beat them--was 
because of the extraordinary professional people we have at 
DOT. I mean, they have been waiting for a long time for this 
kind of opportunity. They love their work. They love to help 
people build roads and runways and create opportunities for 
jobs.
    All of this is done by the professional people at DOT. They 
have done the work. They deserve the credit for getting the 
money out the door and beating the timeframes Congress gave us. 
And, again, I want to repeat this: no earmarks, no boondoggles, 
no sweetheart deals. If you look on recovery.gov, what you will 
see is where the money is being spent, how many jobs it saves 
state by State. This was really established by the White House. 
The President stated it: Get it right. Spend the money 
correctly. This is a lot of money.
    And our people have done it, and we are grateful to them 
for carrying out what the President's vision is for 
transportation. And we are going to be doing it on high-speed 
rail. We are going to be doing it with our discretionary 
grants. People are working very hard to make sure that's is all 
done correctly, too.
    Mr. Schrader. Thank you.
    Secretary Vilsack, like Ms. Lummis, I appreciate your 
coming before the Ag Committee and all the hard work you are 
doing, especially since you are having trouble getting people 
appointed to actually do the work. You guys are doing yeoman's 
labors, I think, in the Department.
    If you could comment, again, I am just impressed with the 
fact that a lot of the projects you are doing are coming in 20 
and 30 percent under budget. How are you able to do that? That 
sounds like excellent work. I wish even private industry could 
get that advantage sometimes.
    Secretary Vilsack. Well, thank you for the opportunity to 
talk about the hardworking folks at USDA. One of the things we 
have attempted to do is try to partner with local governments 
and State governments to try to streamline the process. We have 
encouraged our folks to take a look at ways in which 
applications can be simplified and reduced without sacrificing 
quality of evaluation. We have had people work long hours. 
Oftentimes it is not appreciated; this is not a 9-to-5 job at 
USDA. We say we are every way, every day, USDA. And that means 
we are working all the time around the clock.
    Because we have 3,000 offices between our Rural Development 
Offices and our Farm Service Agency Offices, we've got people 
working overtime in all of those offices at the ground level 
trying to help people understand these programs and be able to 
apply for them. And so, through partnerships, through process 
improvement, we have been able to get the work done. We are 
very pleased with the progress. We are going to continue to 
push forward.
    The fact that we have got 43,000 people, 43,000 families to 
have the opportunity to have home ownership in rural 
communities means a lot to me, because our rural communities 
have suffered from depopulation. And being able to have young 
families be able to purchase homes is a very meaningful thing 
for rural America. So I am pleased with the progress so far. We 
have a lot of work yet to do.
    Mr. Schrader. Thank you, Mr. Secretary.
    It is working well in Oregon, farm loans, and the trade 
adjustment assistance is making a big difference in my State.
    Chairman Spratt. Mr. Etheridge.
    Mr. Etheridge. Thank you, Mr. Chairman.
    Let me thank each of you for coming, and join the others 
for thanking you for your service.
    I have run an agency before I got here, and it is not easy, 
because everybody else thinks they can do a better job than you 
can and they don't have to do it on a day-to-day basis. So 
thank you. And I mean that sincerely.
    Let me just share a couple things and then ask you a 
question, because North Carolina is one of those unique States. 
When the unemployment comes, they are very seldom get hit. 
Unfortunately, this time we are the fourth highest State in the 
Nation in terms of job loss in the last 12 months. The 
unemployment rate now is over 11 percent statewide, and I have 
got counties in my district approaching 15 percent.
    That being said, let me also turn to one other point, and 
talk about funds. The administration, through just your two 
offices and Education has announced $2.3 billion; has made 
available $1.5 billion. Department of Agriculture has announced 
$26 million, made available $98 million--I think that number 
may be off a bit since the $98 million is more than the 
announced. But be that as it may, things are happening. DOT: 
$844 million announced, $416 million already made available.
    The only thing I would say to you, Secretary LaHood, all we 
need to do is give you more resources so we can get it done. 
And count me on that group, because I really think for some of 
these projects, we can put a lot more people to work. The 
reason for that is our State and most States are suffering from 
a bad situation of shortage of funds. So if it had not been for 
these funds, they would be in deep mud. We are one of the few 
States yet to adopt a budget. They sent one to the Governor 
yesterday, almost $1 billion, and that wasn't enough.
    Secretary Vilsack, you understand that. Now they have got 
to go back and do it again and have more money to make things 
meet. So let me thank you for your help and what you are doing.
    And, Mr. Secretary, let me ask you a question. Because I 
have visited a number of our emergency food assistance programs 
and shelters and food banks, and there are a lot of vulnerable 
Americans out there. We made money available in this fund as 
well as in the regular fund. I would appreciate your comment on 
the resources that have thus far been distributed and what 
impact they have had, and are there more in the pipeline? 
Simply because of increasing unemployment, more people now are 
turning to food banks and other help just to be able to sustain 
where they are.
    The second question for you. I am sorry that this is all 
agriculture. We are in a situation where, in North Carolina, we 
have probably the most diverse agriculture or at least one of 
the most diverse in the country, as you well know. And our pork 
and poultry operations are suffering big time. Exports are a 
major part of it. As they change operations through the 
economic times, I would like you to comment on direct loans in 
the Recovery Act: how many of those loans have been made so 
far, and are there more loans in the pipeline?
    We have a number of farmers in my district, and in our 
State, but they are really spread across about 10 States. As a 
result of the economic downturn, a lot of these corporate 
contractors have pulled those contracts. And you have been 
trying to help us, I will go ahead and say that out front 
because we need to do something to get it resolved. They pulled 
the contracts. These guys are sitting there, and we are a State 
who doesn't protect all the homestead. Their homes are 
obligated, all the land and the livestock. And I think it will 
come back. But over the next 18 months, for those who can't get 
it refinanced, they could lose everything they have got and be 
out of business. And that is devastating to some of these 
communities, because they tend to be in groups.
    And I would hope that we can continue to work with your 
office to find a way to give them a bridge over the next 18 
months, even if it is nothing more than interest, so they can 
get back to where this recovery comes and save them. And I 
would appreciate your comments on the food banks and on the 
overall aspect.
    Secretary Vilsack. Representative, as you indicated, you 
have seen directly the benefit of the Recovery Act on the 
capacity of food banks to meet ever-increasing needs. I am sure 
you have seen the stacks and stacks of food products and many 
of them wholesome foods. I have seen chicken and pork. I have 
been to food banks where people have said, ``thank you for the 
stimulus money; otherwise, we would not be able to provide 
hundreds of thousands of additional meals for families who are 
struggling.''
    We have essentially announced most, if not all, of the 
emergency food assistance money that the stimulus provided for. 
There may be just a little left, but for the most part, it has 
been distributed. We tried to get this out as quickly as we 
possibly could on a State-by-State basis and put it to work as 
quickly as possible for two reasons: One, because there is the 
need; and, two, because more product being purchased obviously 
helps those poultry farmers and the pork farmers and all the 
farmers in the country.
    And we are certainly aware of the stress that your poultry 
farmers have undergone and the pork farmers in your State, 
keenly aware. One of the reasons we have done that is that we 
have been able to use some of the powers that you have given us 
to purchase more product. We have been able to encourage our 
institutional purchasers to think about purchasing more pork 
and poultry. We have instructed the Farm Service Agencies and 
offices--in fact, we just recently sent a letter out to all of 
the direct loan borrowers asking them, if they are having 
difficulty, to consider going into the Farm Service Office and 
instructing the Farm Service folks to look for ways in which 
those loans can be restructured, refinanced, redone so that 
interest rates are reduced, so that payments are deferred, so 
that principal is reduced, if that is appropriate, in an effort 
to try to keep folks on the farm.
    Now, we have also sent a similar letter to the commercial 
banks that have been working with us through our guaranteed 
loan program, encouraging them to do the same, because it is in 
their long-term best interest to keep that customer on the 
farm. So we have also suggested the capacity of loans where 
collateral has been provided that has to be sold, that the 
collateral when it is sold, instead of the money going to us or 
to the bank, it is allowed to be used for essentials for farm 
families or to be able to put a crop in or to be able to 
survive and transition.
    As it relates to the operating loans, we put into place 
2,636 direct operating loans; 1,081 of them to beginning 
farmers; 600 of them to socially disadvantaged farmers. That 
used up all of the resources under the stimulus proposal. We 
obviously have our own appropriation, and it was recently 
supplemented. And we are in the process of getting those loans 
out the door as quickly as we possibly can to as many farmers 
as we can help as we can possibly can.
    So, as it relates to direct operating loans, there is still 
supplemental money available.
    Mr. Etheridge. Thank you.
    Thank you, Mr. Chairman, because that is an indication of a 
tremendous need out there. Thank you.
    Chairman Spratt. Ms. Kaptur.
    Ms. Kaptur. Thank you, Mr. Chairman.
    Welcome, Mr. Secretaries. Thank you for your service to our 
country. It must be very difficult to inherit major departments 
of our government at a time of exceptional economic need and 
try to keep your staffs motivated and all pulling in the same 
direction. I really admire you both for the work that you are 
doing. Thank you very much.
    I represent one of the 10 most economically challenged 
communities of over 250,000 people in the country. I also have 
an unusual district in that it is both industrial and 
agricultural. The unemployment rates in the agricultural 
regions are now over 18 percent, and in the major city I 
represent a minimum of 15.4 percent.
    I wanted to ask Secretary Vilsack, I don't know if you have 
traveled through Cleveland, Toledo and Detroit, all along Lake 
Erie we have a series of communities in deep economic distress 
related to the washout in the automotive, steel and machine 
tool industries. I vote for all the programs--for food stamps 
and now renamed SNAP and so forth. And we appreciate the 
emergency assistance. But I would strongly encourage you, and 
we just met with Secretary Solis this morning, to look at the 
WIA and the TANF programs as well as your own authorities to 
think about the following:in communities like ours, around the 
Great Lakes we can grow our own food and we can harvest what is 
likely to be plowed under this fall. We need that food.
    We have food banks where the increase has gone up anywhere 
50 to 100 percent. We have volunteers serving food who are worn 
out. We have to find a way to supplement the emergency food 
efforts going on in our region and we can put some of the 
unemployed to work helping us. It would literally lift spirits 
in regions like ours where a pall has set over the community 
because of the continuing washout in jobs.
    I understand you have hired someone there over at your 
department, Roberta Jeanquart, who came from the RC&D. You 
couldn't have a better person. She comes from the Midwest and 
has enormous experience. We need somebody over there to think 
out of the box on how to meet the rising food needs.
    I had a call last year from one of our companies saying 
Marcy, can you use 400 acres of cabbage? I said, yeah, how am I 
going to get it picked? So I called Silver Queen and I called 
the Ohio Farm Bureau, they helped us get trucks up there one 
weekend. But we can process, we can pick, we can grow in new 
vertical systems that we have put up. But we need USDA pulling 
with us, not fragmented. And one of the programs I want to 
mention to you is under the 2008 farm bill, section 6015, which 
is the Rural Business Cooperative Loan Program, we authorized 
over $3 billion dollars for RBS. And to date not a single penny 
has been spent.
    And that program can you directed to help the underserved. 
And we would very much like to see that program's muscle used, 
as well as the other Federal agencies in helping us glean what 
we can, not waste one piece of fruit, one vegetable this year, 
to process that. And I think if we work across the government 
we can get it done.
    Would you be willing to work with us in Ohio and in 
Michigan looking at your broad authorities in order to do that?
    Secretary Vilsack. Representative, absolutely. And I would 
tell you that we have been working on a program within USDA 
which is indeed thinking outside the box, which will be 
entitled Know Your Farmer, Know Your Food. The purpose of it is 
to try to directly link local production with local 
consumption, and not just farmers' markers but institutional 
consumers.
    Now when you do that, in fact, I was in Philadelphia 
yesterday visiting with folks about this program that they have 
in Philadelphia. What you do is you have to take a look at the 
entire supply chain and you have to figure out how you can 
create sufficient quantities and be able to store it, process 
it, truck it and distribute it. We are and will be using our 
resources to create that supply chain to better link production 
with consumption. It is one of the wealth-creation strategies 
that we will be adopting as part of a new rural development 
initiative within the department. We wanted to make sure we had 
the structure right before we began committing resources.
    Ms. Kaptur. Well, Mr. Secretary, please look inside the 
urban areas where we have so many hungry people. We have them 
out in the rural areas as well. We were just talking to members 
from Arizona and South Carolina about that. And I would urge 
you to invite the members to USDA who represent communities 
with over 15 percent unemployment now, in both urban and rural 
America. There is a discrete number of those. We have thoughts 
about what we need in our areas and how to link them to the 
unemployment programs and the TANF programs across the 
government. It isn't just your jurisdiction, but this food need 
is truly severe and the helpers are wearing out.
    I know my time is expired, Mr. Chairman. Let me just say on 
the Emerald Ash Borer Remediation Program, we are going to lose 
10 percent of the tree cover in our area. We have been trying 
to work with the USDA, Department of the Interior, Department 
of Labor to hire people from the ranks of the unemployed. It 
has been almost impossible to try to get these big massive 
departments to work together to create jobs through the tree 
replanting programs. We would like to draw that to your 
attention and hopefully get a better response out of the 
Agency.
    Secretary Vilsack. I would be happy to take a look at that. 
I will tell you that we have not been a team for very long, but 
I think Secretary LaHood would probably agree with this, we are 
working across lines. We are not trying to work in our 
individual silos. There have been constant meetings with other 
cabinet secretaries to try to coordinate. That is one of the 
reasons on the Recovery Act we are working with other 
departments to provide the transparency that the President and 
the Congress wanted. We are going to continue to try to break 
down those barriers, because we recognize we can leverage 
resources more effectively when we do.
    Ms. Kaptur. Thank you. Thank you, Mr. Chairman.
    Chairman Spratt. Ms. DeLauro.
    Ms. DeLauro. I want to say thank you to the Secretaries for 
being here. It is wonderful to see you both. I just want to 
stay to Secretary LaHood, we miss you on the subcommittee.
    Secretary LaHood. Thank you.
    Ms. DeLauro. It is great to see you here today. I am going 
to try to talk fast, Mr. Chairman, and get in a couple of 
questions to each of the Secretaries. Secretary LaHood, this is 
about the recovery program and maintenance of efforts that the 
governors have to certify to about not cutting their own 
transportation investment efforts.
    In our State of Connecticut, the governor has made such a 
certification. The first question is, have all the governors 
made that commitment? What is the Department doing to make sure 
that States are maintaining their own investment plans? And 
second to that, again with Connecticut, $440 million made 
available, $262 million has been obligated, $71,000 to date has 
been outlaid. And is it accurate to look at outlays as a 
measure of economic activity or should we view outlays as a 
lagging indicator here?
    Secretary LaHood. Well, I think the maintenance of effort 
has been a problem and we are working with the States, but 
every State is required by law to meet it. We are holding 
people's feet to the fire, but we are working with them, 
because we know it is somewhat of a problem, but it is required 
by law. We talk about this every week when we talk about our 
recovery activities and we are working with folks.
    We can check off the boxes, we can approve projects and 
then the States have to hire contractors and then the money 
begins to flow. A lot of money is beginning to flow now, 
because we have checked a lot of boxes. A lot of projects have 
been approved. The States have to award the contracts and then 
people really begin working.
    Look, we know the unemployment figures are the lagging 
indicator. The reflection of unemployment a couple of months 
ago is what will be reflected in the figures. And we think 
unemployment has come down in the building trades, people that 
build roads, and bridges, and runways and buses and all of 
that, but it probably won't be reflected for a couple more 
months.
    Ms. DeLauro. Thank you very much. I tried to explain it in 
a nanosecond, honestly for this institution in 4 weeks to pass 
the size of the effort that we did.
    Secretary LaHood. Right.
    Ms. DeLauro. Now you get newspapers and editorials saying, 
well, where is the Federal Government? The Federal Government 
has been there.
    Secretary LaHood. Right, right, right.
    Ms. DeLauro. I will submit some questions for the record--
--
    Secretary LaHood. Okay.
    Ms. DeLauro [continuing]. That have to do with the Federal 
highway authority requirement.
    Secretary LaHood. Yes, we will answer them.
    Ms. DeLauro. Secretary Vilsack, I appreciated your comments 
to Congressman Yarmuth in walking through how that $1 triggers 
$1.83, if you will, in economic activity. Quite frankly, 
there's real excitement about the opportunity and what kind of 
a stimulative effect food stamps and food assistance can be, 
whether it is food stamps or emergency food aid.
    Let me ask a couple of questions related here. We also 
provided some additional administrative funds to address the 
rising demand for food stamps. Can you give us a sense of some 
of the ways in which States are spending those funds? And 
secondly, with regard to the emergency food assistance program, 
you talked about the States, how is that being distributed in 
the States? Is it competitive? Is it formula? What is the story 
on that and how are those funds being spent?
    Secretary Vilsack. I must admit I am a little confused 
here, because I usually refer to you as Madam Chair.
    Ms. DeLauro. No, no.
    Secretary Vilsack. But I guess I can't do that here.
    Representative, as it relates to your first question, the 
administrative expense money is going to States. As you know, 
States are very, very significantly strapped. As a former 
governor, what you generally do when you are faced with that is 
you take a look first and foremost at your State employment 
base. You try to determine whether or not there is any way that 
you can ride out the storm through retirements, not filling 
vacancies. The problem with that is that the work that was 
otherwise to be done by those individuals is not being done and 
you have to push it aside. In times of crisis the last thing 
you want to do is to reduce the workforce in your Department of 
Human Services or whatever it is called in the various States.
    To the extent that we provided additional administrative 
money, States are using those resources to do two things. One 
is to maintain staff, and two is to make sure that they have 
adequate technology to properly fund and properly keep track of 
these resources.
    Absent those monies, what you would probably see are delays 
in the distribution of those resources, glitches in the 
technology, families who are applying, not getting permission 
as quickly as possible, the emergency food assistance not being 
given out as quickly as possible and families would have been 
suffering. And we would have lost the stimulus effect of 97 
percent of those monies being spent in the first 30 days. I 
must admit that I have lost your second question.
    Ms. DeLauro. It was about TFAB.
    Ms. Schwartz. If the gentlewoman would yield, for just a 
moment.
    Ms. DeLauro. I would be happy to.
    Ms. Schwartz. I just want to say I have to run for a 
conference call, but I would be happy to yield you my 5 
minutes. I would be happy to do that, Congresswoman DeLauro has 
been very kind to me over the years. I just wanted to thank 
both of the Secretaries very much, they both have been in 
Philadelphia, of course, Secretary, just as recent as 
yesterday. I am sorry I couldn't be with you, we were here. But 
I can say for Pennsylvania's 13th congressional district, for 
Philadelphia and southeastern Pennsylvania, the resources and 
support you have provided--Secretary LaHood, we stood at the 
airport--those are very significant dollars, significant 
projects that are really helping us. We would love to see more, 
we would love to see more people back to work, but we look 
forward to working with you. And I would be happy to yield the 
remaining minutes I have to Congresswoman DeLauro.
    Ms. DeLauro. I thank the gentlelady. It is much 
appreciated. I will not take the full 5 minutes. I know you 
have been here a long time this morning and I want to be 
cognizant of the chairman.
    Secretary Vilsack. The TFAB monies were distributed based 
on a formula of each State receiving an amount. Connecticut, 
for example, received in TFAB administrative money $221,000 and 
about $884,000 of additional resources. The use of those monies 
has been predominantly to allow for transportation and storage 
of resources and the purchase of additional commodities.
    I can tell you, as I said earlier, I have been in a number 
of these food banks and it is amazing. They actually have 
segregated the stimulus purchases from the regular purchases, 
and it is remarkable how much food has been purchased from 
stimulus dollars. And then they will turn to you and they will 
say, ``this is feeding and providing hundreds of thousands of 
meals, hundreds of thousands of meals.'' And then you see folks 
who have never had to have assistance before, never have had 
assistance before, who are going to food banks. And thankfully, 
there are volunteers and there are people concerned about this 
who are manning those food banks and volunteering. I know I, as 
part of the President's United We Serve, I did some volunteer 
time at one of the food banks sorting some of the cans that 
were donated. It is a remarkable reaction by a very gracious 
and compassionate Nation.
    Ms. DeLauro. You say it beautifully. I read a quote of a 
man who had a job, lost his job, a professional job. And his 
quote was, ``I never felt so humiliated. I felt like a lowlife, 
but I had to go to the food bank because it was the only way I 
was going to be able to feed my kids.''
    First of all, we should never make anyone feel that way 
about struggling with real challenges in their life and having 
to reach their hand out for a need. But it is remarkable the 
role that these food banks are playing in today's difficult 
economy and making sure that people have food on their plate 
for themselves and for their kids. Let me just say a big thank 
you to the two of you f or your commitment, but also for your 
own personal vision and compassion for what is happening in our 
country today, we are grateful.
    Chairman Spratt. Thank you.
    Ms. DeLauro. Thank you, Mr. Chairman.
    Chairman Spratt. Thank you, Ms. DeLauro, Secretary Vilsack 
and Secretary LaHood, I know the demands upon your time are 
enormous this time of year.
    Mr. Ryan. May I interrupt? Chairman, may I ask unanimous 
consent to submit a question for the record for the three 
Secretaries for some technical issues?
    Chairman Spratt. By all means, all members including the 
ranking member.
    Mr. Ryan. Thank you.
    Chairman Spratt. Will have 7 days without objection to 
submit questions for the record.
    Once again, I know the demands upon your time are enormous, 
but it speaks volumes for your commitment and this 
administration's commitment to turning this economy around, for 
you to come and give us these forthright, clear, credible 
answers. I think we leave here believing that the Recovery Act 
is working and will continue to work by design and it will help 
pull us out the worst slump since the 1930s. Thank you very 
much, indeed, for your contribution.
    [Whereupon, at 12:40 p.m., the committee was adjourned.]

                                  
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