[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]
LEGISLATIVE HEARING ON H.R. 2309, CONSUMER CREDIT PROTECTION
IMPROVEMENT ACT; AND H.R. 2190, MERCURY POLLUTION REDUCTION ACT
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON COMMERCE, TRADE,
AND CONSUMER PROTECTION
OF THE
COMMITTEE ON ENERGY AND COMMERCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED ELEVENTH CONGRESS
FIRST SESSION
__________
MAY 12, 2009
__________
Serial No. 111-38
Printed for the use of the Committee on Energy and Commerce
energycommerce.house.gov
U.S. GOVERNMENT PRINTING OFFICE
72-887 WASHINGTON : 2012
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing Office,
http://bookstore.gpo.gov. For more information, contact the GPO Customer Contact Center, U.S. Government Printing Office. Phone 202�09512�091800, or 866�09512�091800 (toll-free). E-mail, gpo@custhelp.com.
COMMITTEE ON ENERGY AND COMMERCE
HENRY A. WAXMAN, California, Chairman
JOHN D. DINGELL, Michigan JOE BARTON, Texas
Chairman Emeritus Ranking Member
EDWARD J. MARKEY, Massachusetts RALPH M. HALL, Texas
RICK BOUCHER, Virginia FRED UPTON, Michigan
FRANK PALLONE, Jr., New Jersey CLIFF STEARNS, Florida
BART GORDON, Tennessee NATHAN DEAL, Georgia
BOBBY L. RUSH, Illinois ED WHITFIELD, Kentucky
ANNA G. ESHOO, California JOHN SHIMKUS, Illinois
BART STUPAK, Michigan JOHN B. SHADEGG, Arizona
ELIOT L. ENGEL, New York ROY BLUNT, Missouri
GENE GREEN, Texas STEVE BUYER, Indiana
DIANA DeGETTE, Colorado GEORGE RADANOVICH, California
Vice Chairman JOSEPH R. PITTS, Pennsylvania
LOIS CAPPS, California MARY BONO MACK, California
MICHAEL F. DOYLE, Pennsylvania GREG WALDEN, Oregon
JANE HARMAN, California LEE TERRY, Nebraska
TOM ALLEN, Maine MIKE ROGERS, Michigan
JAN SCHAKOWSKY, Illinois SUE WILKINS MYRICK, North Carolina
HILDA L. SOLIS, California JOHN SULLIVAN, Oklahoma
CHARLES A. GONZALEZ, Texas TIM MURPHY, Pennsylvania
JAY INSLEE, Washington MICHAEL C. BURGESS, Texas
TAMMY BALDWIN, Wisconsin MARSHA BLACKBURN, Tennessee
MIKE ROSS, Arkansas PHIL GINGREY, Georgia
ANTHONY D. WEINER, New York STEVE SCALISE, Louisiana
JIM MATHESON, Utah PARKER GRIFFITH, Alabama
G.K. BUTTERFIELD, North Carolina ROBERT E. LATTA, Ohio
CHARLIE MELANCON, Louisiana
JOHN BARROW, Georgia
BARON P. HILL, Indiana
DORIS O. MATSUI, California
DONNA CHRISTENSEN, Virgin Islands
KATHY CASTOR, Florida
JOHN P. SARBANES, Maryland
CHRISTOPHER MURPHY, Connecticut
ZACHARY T. SPACE, Ohio
JERRY McNERNEY, California
BETTY SUTTON, Ohio
BRUCE BRALEY, Iowa
PETER WELCH, Vermont
(ii)
Subcommittee on Commerce, Trade, and Consumer Protection
BOBBY L. RUSH, Illinois
Chairman
JAN SCHAKOWSKY, Illinois CLIFF STEARNS, Florida
Vice Chair Ranking Member
JOHN SARBANES, Maryland RALPH M. HALL, Texas
BETTY SUTTON, Ohio DENNIS HASTERT, Illinois
FRANK PALLONE, New Jersey ED WHITFIELD, Kentucky
BART GORDON, Tennessee CHARLES W. ``CHIP'' PICKERING,
BART STUPAK, Michigan Mississippi
GENE GREEN, Texas GEORGE RADANOVICH, California
CHARLES A. GONZALEZ, Texas JOSEPH R. PITTS, Pennsylvania
ANTHONY D. WEINER, New York MARY BONO MACK, California
JIM MATHESON, Utah LEE TERRY, Nebraska
G.K. BUTTERFIELD, North Carolina MIKE ROGERS, Michigan
JOHN BARROW, Georgia SUE WILKINS MYRICK, North Carolina
DORIS O. MATSUI, California MICHAEL C. BURGESS, Texas
KATHY CASTOR, Florida
ZACHARY T. SPACE, Ohio
BRUCE BRALEY, Iowa
DIANA DeGETTE, Colorado
JOHN D. DINGELL, Michigan (ex
officio)
C O N T E N T S
----------
Page
Hon. Bobby L. Rush, a Representative in Congress from the State
of Illinois, opening statement................................. 19
Prepared statement........................................... 21
Hon. George Radanovich, a Representative in Congress from the
State of California, opening statement......................... 23
Hon. Janice D. Schakowsky, a Representative in Congress from the
State of Illinois, opening statement........................... 24
Hon. Phil Gingrey, a Representative in Congress from the State of
Georgia, opening statement..................................... 25
Hon. John P. Sarbanes, a Representative in Congress from the
State of Maryland, opening statement........................... 26
Hon. John Barrow, a Representative in Congress from the State of
Georgia, opening statement..................................... 27
Hon. Doris O. Matsui, a Representative in Congress from the State
of California, opening statement............................... 27
Hon. John D. Dingell, a Representative in Congress from the State
of Michigan, prepared statement................................ 211
Witnesses
Eileen Harrington, Acting Director, Bureau of Consumer
Protection, Federal Trade Commission........................... 28
Prepared statement........................................... 31
Answers to submitted questions............................... 172
Kathleen Keest, Senior Policy Counsel, Center for Responsible
Lending........................................................ 43
Prepared statement........................................... 45
John Beisner, Managing Partner, O'Meleveny & Myers, on Behalf of
the U.S. Chamber of Commerce................................... 82
Prepared statement........................................... 84
Catherine O'Neill, Associate Professor of Law, Seattle University
School of Law, Member Scholar, Center for Progressive Reform... 115
Prepared statement........................................... 118
Answers to submitted questions \1\
Lynn Goldman, M.D., M.P.H., Professor, Johns Hopkins School of
Public Health, Principal Investigator, Johns Hopkins National
Children's Study (Former EPA Assistant Administrator for
Prevention, Pesticides, and Toxic Substances, Administration of
President William Jefferson Clinton)........................... 125
Prepared statement........................................... 127
Answers to submitted questions \2\
Richard Jackson, Executive Vice President of Operations, Ashta
Chemicals Inc.................................................. 132
Prepared statement........................................... 134
Answers to submitted questions............................... 178
Submitted Material
H.R. 2309........................................................ 2
H.R. 2190........................................................ 10
Letter of May 12, 2009, from Ms. Matsui to the GAO, submitted by
Ms. Matsui..................................................... 92
Statement of the American Financial Services Association......... 99
Statement of the National Automobile Dealers Association......... 106
Statement of Bill McCollum, Florida Attorney General............. 112
Letter of May 12, 2009, from 43 environmental groups supporting
H.R. 2190...................................................... 148
Letter of May 11, 2009, from The Chlorine Institute to Messrs.
Rush and Radanovich............................................ 155
Report entitled ``Assessment of Test Results for Mercury in High
Fructose Corn Syrup,'' by Dr. Woodhall Stopford................ 161
Report entitled ``Normal Mercury Levels in Food and Beverages,''
by Dr. Woodhall Stopford....................................... 163
News release from the Corn Refiners Association, dated March 18,
2009........................................................... 166
News release from ChemRisk, dated January 30, 2009............... 169
----------
\1\ Ms. O'Neill did not respond to submitted questions for the
record.
\2\ Ms. Goldman did not respond to submitted questions for the
record.
LEGISLATIVE HEARING ON H.R. 2309, CONSUMER CREDIT PROTECTION
IMPROVEMENT ACT; AND H.R. 2190, MERCURY POLLUTION REDUCTION ACT
----------
TUESDAY, MAY 12, 2009
House of Representatives,
Subcommittee on Commerce, Trade,
and Consumer Protection,
Committee on Energy and Commerce,
Washington, DC.
The subcommittee met, pursuant to call, at 2:05 p.m., in
Room 2322, Rayburn House Office Building, Hon. Bobby L. Rush
[chairman of the subcommittee] presiding.
Present: Representatives Rush, Schakowsky, Sarbanes,
Barrow, Matsui, Radanovich, Gingrey, Scalise and Barton (ex
officio).
Staff Present: Christian Tanotsu Fjeld, Counsel; Anna
Laitin, Professional Staff; Robin Appleberry, Counsel; Valerie
Baron, Legislative Clerk; Michelle Ash, Counsel; Shannon
Weinberg, Minority Counsel; Brian McCullough, Minority Senior
Professional Staff; Jerry Couri, Minority Professional Staff;
Will Carty, Minority Professional Staff; and Sam Costello,
Minority Legislative Analyst.
Mr. Rush. The subcommittee will come to order.
Today's hearing is a legislative hearing. It is on two
bills, H.R. 2309 and H.R. 2190.
[The information follows:]
[GRAPHIC] [TIFF OMITTED] T2887A.001
[GRAPHIC] [TIFF OMITTED] T2887A.002
[GRAPHIC] [TIFF OMITTED] T2887A.003
[GRAPHIC] [TIFF OMITTED] T2887A.004
[GRAPHIC] [TIFF OMITTED] T2887A.005
[GRAPHIC] [TIFF OMITTED] T2887A.006
[GRAPHIC] [TIFF OMITTED] T2887A.007
[GRAPHIC] [TIFF OMITTED] T2887A.008
[GRAPHIC] [TIFF OMITTED] T2887A.009
[GRAPHIC] [TIFF OMITTED] T2887A.010
[GRAPHIC] [TIFF OMITTED] T2887A.011
[GRAPHIC] [TIFF OMITTED] T2887A.012
[GRAPHIC] [TIFF OMITTED] T2887A.013
[GRAPHIC] [TIFF OMITTED] T2887A.014
[GRAPHIC] [TIFF OMITTED] T2887A.015
[GRAPHIC] [TIFF OMITTED] T2887A.016
[GRAPHIC] [TIFF OMITTED] T2887A.017
OPENING STATEMENT OF HON. BOBBY L. RUSH, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ILLINOIS
Mr. Rush. The Chair will recognize himself for 5 minutes
for the purposes of opening statements.
Today, as I said before, the subcommittee is conducting yet
another legislative hearing on two more bills, H.R. 2309, the
Consumer Credit and Debt Protection Act, and H.R. 2190, the
Mercury Pollution Reduction Act. This hearing continues our
trend to hold legislative hearings with the intent of moving
bills towards eventually becoming law.
H.R. 2390, the Mercury and Pollution Reduction Act, was
introduced by the Vice Chair of the subcommittee, my friend and
colleague from Chicago Ms. Schakowsky. The bill effectively
bans the use of mercury in the production of chlorine and
caustic soda and prohibits the export of mercury effective
immediately.
Mercury is well known to cause neurological damage,
especially to children. The toxin is also found in fish, and
when people eat contaminated fish, they also consume the
mercury. Pregnant women who ingest the mercury in fish pass the
toxic effects along to their developing fetus, which can lead
to long-term neurological harm.
Furthermore, studies indicate that unsafe mercury levels
are more prominent in people of color and in poor communities,
and this disparate impact along ethnic and racial lines is
likely the result of fish and seafood consumption.
It is my understanding that only four manufacturing plants
still use mercury in the production of chlorine. It is also my
understanding that the chlorine industry has made the
transition away from mercury as a result of increased
efficiency in alternative methods of manufacturing. As such, I
am interested to know why Ms. Schakowsky's bill shouldn't
become law as soon as possible due to the harmful effects of
mercury and the cost savings associated with producing chlorine
from other methods. I want to commend Ms. Schakowsky for her
work on this bill.
I am the author of the second bill we are considering
today. H.R. 2309, the Consumer Credit and Protection Act, is a
result of two oversight hearings this subcommittee has held on
consumer credit issues this year. The bill provides the Federal
Trade Commission with normal rulemaking authority under the
Administrative Procedures Act, for all consumer credit and
debt-related issues as opposed to its current cumbersome
rulemaking authority under the Magnuson-Moss Act. This
authority will empower the Commission to nimbly respond to
current and future abuses perpetrated on consumers.
My bill also directs the Commission to specifically address
current abuses in the automobile and debt consolidation
industries. It is my intent, during an eventual markup, to also
add a directive rulemaking on pending legislation as well.
I hope the witnesses will provide the information the
subcommittee needs on how effective H.R. 2309 would be in
protecting consumers not only from the credit and debt scams of
today, but the scams of tomorrow, also.
It is important that the FTC have the requisite flexibility
and authority to address numerous credit fraud that plagues
consumers. Moreover, I believe it is extremely important that
the Commission retain this aggressive posture of consumer
credit and debt regardless of the political leadership at the
top. Both Democrats and Republicans are guilty of being asleep
at the switch, and difficulties in the financial and housing
market have shown us that we can no longer afford this type of
political negligence. It is vital that we revitalize the
Federal Trade Commission's work on behalf of consumers in order
to prevent the types of widespread abuses that weren't
addressed in the past.
Today I hope to have an informative legislative hearing on
these two bills and work with all of the affected stakeholders
and my friends on the other side of the aisle. We may end up
disagreeing, but as always, I believe in disagreeing in a civil
and politically honest manner.
With that, I yield back the balance of my time.
[The prepared statement of Mr. Rush follows:]
[GRAPHIC] [TIFF OMITTED] T2887A.018
[GRAPHIC] [TIFF OMITTED] T2887A.019
Mr. Rush. The Chair now recognizes the Ranking Member of
the subcommittee Mr. Radanovich for 5 minutes for an opening
statement.
OPENING STATEMENT OF HON. GEORGE RADANOVICH, A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF CALIFORNIA
Mr. Radanovich. Thank you very much.
Today we examine two pieces of legislation under the
subcommittee's jurisdiction. The first bill is H.R. 2309,
addressing credit and debt issues under the Federal Trade
Commission's jurisdiction.
As I have stated previously, I support cracking down on
anybody who breaks the law or takes unfair advantage of others
for their own gain. Mortgage and foreclosure problems have
revealed deception, lying and stealing at all levels of the
homebuying process from consumers falsely stating their income
to mortgage companies deceiving consumers about their loans.
There should be no tolerance for these practices, practices
that have devastated many consumers with foreclosures and have
put all taxpayers on the hook for these bad actors' deeds.
Similarly, the economic downturn has caused many to find
themselves over their heads with nonmortgage debt. I support
the markets' creation of third-party entities who negotiate on
these individuals' behalves, but I also see opportunities where
abuse and fraud may arise. Therefore, I support the
legislation's direction to the FTC to examine debt settlement
practices and promulgate rules as necessary. However, my
question within these proposed rules is what is lacking in the
current law? Is there a problem so widespread that it requires
an industrywide solution; and, finally, will the proposed rule
solve the problem?
My primary concern is that the examination be thorough and
the evidence substantial before any rules are proposed.
Industrywide rules impose costs on innocent, law-abiding
citizens and, therefore, need to be thoroughly vetted to ensure
they are justified and the best solution for the problem.
This leads me to a larger concern with the bill's
authorization of the general APA rulemaking authority with
credit and debt practices. Congress imposed the more rigorous
Magnuson-Moss rulemaking procedures on the FTC for a reason.
Providing a blank check for more rules is a change Congress
should not contemplate lightly, particularly when the impact
will be sweeping. The benefit must outweigh the costs.
The two provisions which I am concerned with are the grants
of civil penalty authority in cases of implied knowledge, and
the broad State attorneys general enforcement provision. The
FTC may currently seek civil penalties only in a case where the
defendant was on notice that their conduct was wrongful. This
bill would make people liable without their knowledge that they
are engaged in wrongful conduct.
My second concern is the breathtaking extent of the
proposed State attorney general's enforcement power. It would
apply to an FTC-enforced statute regulating consumer credit or
debt without transparency or checks and balances on that power.
Additionally, because most suits prosecuting unfair, deceptive
acts are not based on hard and fast rules, this authority will
yield many inconsistent interpretations and outcomes.
The second bill we are examining today, H.R. 2190, would
ban the use of mercury cell technology to produce chlorine and
caustic soda. I think we need to look carefully not just at the
bill itself, but also at the other legal and regulatory actions
at the Federal level on this matter. This legislation only
addresses four plants in the United States. We should neither
be cavalier about the bill's impact because it affects four
plants, nor should we fully ignore its effects on policy.
For starters, the last Congress took great care to
overwhelmingly pass bipartisan legislation that banned export
of elemental mercury beginning in 2013. This law represents a
collaborative effort among diverse stakeholders and created an
orderly transition for management and storage of mercury held
by both public and private interests. I fear the provisions of
this bill will unnecessarily undo our thoughtful work and make
mercury repositories of chlorine factories for several years.
In addition, I am concerned that parts of the bill
unnecessarily duplicate existing reporting requirements on
these facilities. I have problems requiring reports for the
sake of requiring them, and I hope that at least one of our
witnesses can point out to me both the practical need for and
the legal gap being plugged by each of these mandates.
From a larger policy perspective, I am concerned that this
bill continues the trend of selectively deciding which
products, technologies, and substances are OK for the public to
have, and, in my view, some of the proponents of this bill are
inconsistently applying their concerns about mercury depending
on the technology or the product.
Let me give you an example. H.R. 2190 states that the U.S.
should develop policies that reduce exposure to mercury,
particularly the exposure of child-bearing-aged women and young
children. Yet in the last Congress, the Democrat Majority
insisted on legislation forcing daycare centers, hospitals,
schools, and nursing homes to use mercury-laced compact
fluorescent light bulbs. If we are serious about this issue,
Congress cannot send mixed signals to the American public about
these public health threats.
I want to thank today all of our witnesses for being here,
and I want to thank you, Mr. Chairman, and know that I am eager
to work in a bipartisan manner to address the concerns on both
sides of the aisle on these issues.
Thank you very much.
Mr. Rush. The Chair thanks the gentleman.
The Chair now recognizes the sponsor of one of the bills
that we are considering today, H.R. 2190. My friend from
Chicago Ms. Schakowsky is recognized for 2 minutes.
OPENING STATEMENT OF HON. JANICE D. SCHAKOWSKY, A
REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS
Ms. Schakowsky. Thank you for holding this hearing today. I
congratulate you on this legislation.
Right now I want to focus my remarks on H.R. 2190, the
Mercury Pollution Reduction Act, a bill that protects the
public health by ending the hazardous use of mercury cell
technology at chlor-alkali plants in the United States.
Mr. Chairman, the dangers associated with exposure to
mercury are well documented, and you mentioned some. According
to the EPA, mercury pollution can do irreparable damage to
cognitive functioning in adults and to an infant's developing
nervous system. It is so dangerous that the Federal Government
has warned pregnant women and those who may become pregnant not
to eat fish with high levels of mercury, such as swordfish, and
to severely limit their consumption of others, such as tuna.
While H.R. 2190 only addresses mercury pollution from four
remaining chlor-alkali plants that use mercury, it must be
emphasized that the impact these plants have on surrounding
communities is severe, and, even worse, unnecessary. Unlike
coal-fired power plants, there are readily available
alternatives that could and should be used. In fact, converting
from mercury cell technology to membrane cell has proven not
only to be drastically better for the environment, but also
wise business practice, saving companies millions of dollars in
energy-efficiency costs.
I introduced this legislation because I believe that
Congress has a responsibility to minimize the public's exposure
to mercury pollution, especially when cleaner, safer
alternatives exist.
And I want to thank Oceana, an environmental organization,
for their tireless efforts, and the committee staff for their
diligent work on this bill.
I urge my colleagues to support its passage, and I yield
back the balance of my time.
Mr. Rush. The Chair now recognizes the gentleman from
Georgia for 2 minutes.
OPENING STATEMENT OF HON. PHIL GINGREY, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF GEORGIA
Dr. Gingrey. Mr. Chairman, thank you so much for calling
this hearing today so we can hear testimony on H.R. 2190, the
Mercury Pollution Reduction Act. It is my hope that moving
forward on these two bills, including H.R. 2309, the Consumer
Credit and Debt Protection Act, we can work in a bipartisan
manner to accomplish our shared goal of increased and enhanced
consumer protection.
H.R. 2309 would expand the role of the Federal Trade
Commission by changing the rulemaking authority that relates to
consumer credit and debt from the established and rigorous
Magnuson-Moss procedures to the authority under the
administrative procedures at APA.
Mr. Chairman, at a hearing on this topic on March the 24th,
I urged my colleagues to take caution in making this change in
rulemaking procedure. Magnuson-Moss was designed in the 1970s
to be onerous so as to avoid whimsical changes in FTC
regulations. While I think the end goal here is commendable, I
still have concerns that a simple legislative change will open
the door to future unraveling of the Magnuson-Moss procedures.
H.R. 2190 bans the manufacturer of chlorine using the
mercury cell process, including the export of any mercury,
within 2 years. As a physician for nearly 30 years, I believe
it is critically important that we take proactive steps to
ensure the health and safety of our citizens.
During the 110th Congress, President Bush signed into law
Senate bill 906, the Mercury Export Ban of 2008, that was
introduced by then-Senator, now President, of course, Barack
Obama. This legislation specifically outlawed the export of
elemental mercury starting in 2013, similar, very much, to what
is proposed in 2190. Therefore, given the duplicative nature of
H.R. 2190 in regard to at least that section, I am concerned
that we would be stretching our Federal resources too thinly on
this important matter if the bill is enacted.
Mr. Chairman, on both bills before us today, I urge my
colleagues to exercise due caution, to consider the possible
unintended consequences that we always should.
I do look forward to hearing from our two panels today on
these issues.
Mr. Rush. The Chair now recognizes the gentleman from
Maryland Mr. Sarbanes for 2 minutes for the purposes of opening
statement.
OPENING STATEMENT OF HON. JOHN P. SARBANES, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF MARYLAND
Mr. Sarbanes. Thank you, Mr. Chairman. I appreciate you
calling a hearing on these two important bills.
I want to congratulate Ms. Schakowsky for her efforts with
respect to the Mercury Pollution Reduction Act. It sounds like
it is a pretty focused measure to address what is a kind of
loophole right now in terms of a major source of mercury
pollution, and I hope we can move quickly forward on this.
With respect to the Consumer Credit Debt and Protection
Act, I participated in the hearing that you called previously.
It was very eye-opening in viewing how this subprime culture
that we addressed mostly in our discussions with respect to the
housing sector has also infected auto financing and other
sources of credit, and how these loopholes exist in a way that
allows predators to enter that space. And so this proposes
giving the FTC--which, of course, comes with an exclusive focus
on consumer protection--a role in the designing of a new
regulatory framework with respect to the financial services
industry, and a very important role at that.
One of the anxieties many of us have is that as we design
that new framework, it will not be done in a strategic way. We
will end up with loopholes in it that people can take advantage
of. And I think having an agency at the table that has got this
very keen focus on the consumer is part of making sure that
that strategic framework is as robust as it can possibly be.
So I thank you for calling the hearing so we can hear these
proposals discussed.
Mr. Rush. The Chair thanks the gentleman.
The Chair now recognizes my friend from Georgia Mr. Barrow
for 2 minutes for the purposes of an opening statement.
OPENING STATEMENT OF HON. JOHN BARROW, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF GEORGIA
Mr. Barrow. I thank the Chair.
I am going to limit my remarks to H.R. 2190, the Mercury
Pollution Reduction Act.
I am in a tough spot today because while I recognize the
environmental benefits of banning chlor-alkali mercury
technology, I am one of the few Members of Congress who
actually represents one of the facilities that still uses that
technology. While I am willing to acknowledge it is a good
thing there are only four of these plants left in the country,
I have to be sensitive and ask my colleagues to be sensitive to
the 150 jobs and the multimillion-dollar impact this plant
brings to my district.
My colleagues have done a good job of highlighting
environmental and health reasons to move this bill. I think
they are obvious and compelling. I ask my colleagues to also be
sensitive to the economic impacts, as I think those arguments
are also obvious and compelling.
The question is, can we serve both purposes and find a
productive solution for all involved? I think we can. I
respectfully suggest the bill, as written--and considering time
and financial pressures, it is going to be very hard for the
affected companies to comply with except to shut them down. It
is not my goal to shut down an employer in my district. I won't
consider that a success.
The ideal solution, in my mind, would be the plant which I
represent have the opportunity and the ability to transition to
the new technology and preserve the jobs there for a long time
into the future. I hope that is the intention of the committee,
and I look forward to working to find a solution that secures
the jobs and protects the environment.
Mr. Rush. The Chair now recognizes the gentlelady from
California. Ms. Matsui is recognized for 2 minutes for the
purposes of opening statement.
OPENING STATEMENT OF HON. DORIS O. MATSUI, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CALIFORNIA
Ms. Matsui. I want to thank you very much for calling
today's hearing. I would also like to thank our panelists for
sharing their expertise with us.
In today's economic recession, many families in my home
district of Sacramento are struggling to make ends meet. I have
heard countless stories of people struggling to keep their
homes, their jobs, and their way of life. Many of my
constituents were victims of predatory lending and were steered
into high-cost, bad loans. Now, many of these homeowners are
seeking assistance in modifying their loans to more affordable
terms, yet many of these individuals are now being tricked by
scam artists posing as so-called ``foreclosure consultants'' to
save their homes. These scams are costing thousands of dollars
and represent false promises to struggling homeowners.
During last week's debate on the mortgage reform bill, I
offered an amendment that was included in the final bill that
directs the GAO to conduct a study of the government's current
efforts to combat foreclosure rescue scams. It is clear that
consumers are not being properly protected from these shameful
practices.
It is also clear that we can do more to protect the
American people from harmful exposure to mercury. Mercury is a
known toxin, and we should do all in our power to ensure that
it stays out of our newborns' bodies.
I look forward to hearing from today's witnesses,
particularly from Dr. Lynn Goldman, who is the principal
investigator of the National Children's Study, and who is an
expert on mercury exposure.
I thank you, Mr. Chairman, for holding this important
hearing today. I yield back the balance of my time.
Mr. Rush. The Chair thanks the gentlelady.
Now it is my honor and privilege to recognize this panel of
experts that have taken time out from their busy schedules to
participate in this hearing. They come from well-established
institutions, and they are, indeed, highly esteemed individuals
in their line of work.
First of all, to my left is Ms. Eileen Harrington. Ms.
Harrington has made a habit of coming before this committee,
and you are always welcome. And she often appears before this
subcommittee, and she is the Acting Director of the Bureau of
Consumer Protection at the FTC.
Next to Ms. Harrington is Ms. Kathleen Keest. She is the
senior policy counsel for the Center for Responsible Lending.
And our next witness and panelist is Mr. John Beisner. Mr.
Beisner is the managing partner of the firm O'Meleveny & Myers.
He is appearing on behalf of the U.S. Chamber of Commerce.
I want you to know, again, that you are welcome to this
committee. And we are looking forward to your testimony. And
you can please begin your testimony with 5 minutes of opening
statements.
The Chair recognizes Ms. Harrington.
STATEMENTS OF EILEEN HARRINGTON, ACTING DIRECTOR, BUREAU OF
CONSUMER PROTECTION, FEDERAL TRADE COMMISSION; KATHLEEN KEEST,
SENIOR POLICY COUNSEL, CENTER FOR RESPONSIBLE LENDING; AND JOHN
BEISNER, MANAGING PARTNER, O'MELEVENY & MYERS, ON BEHALF OF THE
U.S. CHAMBER OF COMMERCE
STATEMENT OF EILEEN HARRINGTON
Ms. Harrington. Thank you, Chairman Rush.
I am Eileen Harrington, the Director of the FTC's Bureau of
Consumer Protection. I appreciate the opportunity to appear
here today to discuss the Consumer Credit and Debt Protection
Act and the FTC's role in protecting consumers of financial
services. The Commission's views are set forth in the written
testimony that we have submitted. My oral presentation and
answers to your questions represent my own views.
As we know, the current economic crisis continues to have a
devastating effect on many consumers. Many are struggling to
pay their bills, keep their homes, deal with abusive debt
collectors, and maintain their credit ratings. Two months ago
you asked the FTC to tell you what it has been doing to help
consumers through this difficult time. We told you about how we
have been using our tools, law enforcement, consumer education
policy and research, to help protect consumers in financial
distress from being taken advantage of by those who flout the
law. When we came before you then, we recognized that we needed
to do more, however, and we asked for your help.
Your response, the Consumer Credit and Debt Protection Act,
is directly on point. In particular, this bill would build on
the new authority we obtained under the 2009 Omnibus
Appropriations Act by enabling us to issue rules targeting the
practices that caused the most harm to consumers in the broader
credit and debt marketplace.
Historically, the Commission has relied heavily on its law
enforcement experience to inform its rulemakings undertaken
under the Administrative Procedures Act with the express
consent of Congress. This approach has served us well in the
past, and will continue to do so here. Thus, in deciding which
practices in the credit and debt market to target, we would
rely on our casework to help identify any industrywide problems
and pervasive consumer injury.
The Consumer Credit and Debt Protection Act also would
allow us to seek civil penalties against those who violate any
such rules that the Commission issues in this area. This is
significant because civil penalties deter would-be violators.
The FTC strongly supports the enactment of this type of
legislation.
As you know, we are already using our new authority under
the 2009 Omnibus Appropriations Act to develop new consumer
protection regulations in the mortgage context. We expect these
rules to address unfair and deceptive practices in mortgage
lending, mortgage foreclosure rescue, mortgage loan
modification, and mortgage servicing. The 2009 Omnibus
Appropriations Act enhanced the Commission's ability to enforce
these rules by allowing the FTC to obtain civil penalties
against violators. Meanwhile, the Commission continues to
vigorously enforce the FTC Act as well as other statutes and
rules for which it has enforcement authority.
In response to the current economic crisis, the FTC has
intensified its focus on protecting consumers of financial
services and has targeted particular illegal practices in
mortgage advertising, lending and servicing. Let me give you
two examples. This past Friday the Commission announced an
enforcement action against Golden Empire Mortgage and its
individual owner for alleged violations of the Equal Credit
Opportunity Act and Regulation B. The Commission alleged that
the defendants charged Hispanic consumers higher prices for
mortgage loans than non-Hispanic white consumers. The FTC
alleged that the credit characteristics or underwriting risk of
the company's customers could not explain the differences in
the prices charged.
A second example. On April 6th, also since the last time we
were here, the FTC joined with Treasury, HUD, the Department of
Justice, and the Illinois attorney general to announce a
coordinated crackdown on mortgage foreclosure rescue fraud. The
Federal law enforcement component of that crackdown was done by
the FTC.
Although vigorous law enforcement is essential in providing
more effective Federal oversight of the financial services
sector, a broader legislative response may be appropriate here.
Several bills have been introduced and proposals offered under
which there would be some type of overall Federal regulator of
financial services. There are differences in these bills and
proposals to rationalize the oversight system, and there are
numerous challenging issues that would have to be resolved to
implement those concepts. Because of its unequaled
comprehensive focus on consumer protection, its independence
from providers of financial services, and its emphasis on
vigorous law enforcement, we ask Congress to ensure that the
FTC is considered as Congress moves forward in determining how
to modify Federal consumer financial services. The Commission
would be pleased to work with Congress and the subcommittee in
developing and defining a new role for the FTC.
Thank you for inviting the Commission to testify at this
hearing. I would be pleased to answer any of your questions.
Mr. Rush. Thank you.
[The prepared statement of Ms. Harrington follows:]
[GRAPHIC] [TIFF OMITTED] T2887A.020
[GRAPHIC] [TIFF OMITTED] T2887A.021
[GRAPHIC] [TIFF OMITTED] T2887A.022
[GRAPHIC] [TIFF OMITTED] T2887A.023
[GRAPHIC] [TIFF OMITTED] T2887A.024
[GRAPHIC] [TIFF OMITTED] T2887A.025
[GRAPHIC] [TIFF OMITTED] T2887A.026
[GRAPHIC] [TIFF OMITTED] T2887A.027
[GRAPHIC] [TIFF OMITTED] T2887A.028
[GRAPHIC] [TIFF OMITTED] T2887A.029
[GRAPHIC] [TIFF OMITTED] T2887A.030
[GRAPHIC] [TIFF OMITTED] T2887A.031
Mr. Rush. Our next witness is Ms. Keest.
Ms. Keest, you are recognized for 5 minutes for the
purposes of opening statements.
STATEMENT OF KATHLEEN KEEST
Ms. Keest. Thank you, Mr. Chairman, and thank you very much
for inviting me to testify. In my remarks today, I am only
going to focus, I think, on a couple of points, primarily the
Magnuson-Moss rulemaking, and I may add a couple of remarks
about the Attorney General's enforcement authority, as I used
to be in the Attorney General's office myself. And I would
refer the committee to my written testimony for the specifics.
While we are not talking so much about mortgages today, I
think since we are talking about consumer credit, we have an
object lesson that we can learn from in what happened there.
And the FTC's jurisdiction over consumer credit covers a lot of
the same subject matter area that the Federal banking agencies
did. And what we know is that from a regulatory perspective,
that there are three tools that are needed to make sure that
there are clear rules to the game, and that there is a referee
on site to enforce those rules.
We know, now, that the banking agencies, much to our
dismay, didn't use any of them. The FTC, by contrast, really,
it functionally only had one of those tools, and that was the
tool that allows the referee to call a foul after it has
already happened, and it is an important tool, but it is not
sufficient.
What are those three tools? One of them is to set the rules
of the game that everybody has to play. And I am a strong
believer in the fact that that is as important for ethical and
honest business competition as it is for consumers. I do not
believe it is a zero-sum game, and I think that has been part
of the problem of thinking of it in that way.
The second is the right to sort of keep an ongoing
monitoring system where you can do prevention through
monitoring. That is a tool that the banking industries have
that the FTC doesn't, which leaves just the law enforcement,
and that was the only tool the FTC had in practice. In theory,
it had the rulemaking authority, but Magnuson-Moss, I
understand--I am sorry Congressman Gingrey isn't here--I
understand the purpose of it originally, but I can tell you
that I have got gray hair now.
The first year, my first year in practice, was when the
last time the Magnuson-Moss rule was used by the FTC. The
credit practices rule was started in 1975 when I was a brand
new lawyer. That process took 10 years. I testified at one of
the hearings; I was part of that two-book record that it took
to get that rule in place. It was 10 years later when that rule
finally went into effect. The amount of credit out there went
from something like $190 billion to almost $500 billion in that
time, and the market had already started to change.
Now, that rule was very important, and it did a lot of
things, but we were so far behind the eight ball by the time it
happened--and in an agency that has got the breadth of
jurisdiction this one does, devoting time and resources to a
process that could take 10 years is a march down into a long,
dark tunnel that they simply could not afford, and neither
could consumers, because too much damage happens along that
way.
By contrast, the Federal banking agencies, once they got on
the dime, they proposed their credit card rules. The OTS, the
Federal Reserve Board and the NCUA proposed their credit card
rules. It was proposed, there was input, there was a lot of
discussion, and it was promulgated within less than a year; and
now there is a year-and-a-half lead time for the issuers who
are affected by that rule to gear up and do it, but they know
what those rules are going to be, and they have got that time
to do it.
So I think the APA rulemaking is a critical, critical part
of this.
And I would just like to make a pitch for--Congressman, you
mentioned sort of perhaps wanting to consider paydays along the
way. In our testimony that we had suggested--that is, this
credit practices rule, the last one that the FTC used, this
Magnuson-Moss provision that had a delivery period that would
make an elephant weep, it was a really good rule that took care
of some of the most egregious abuses that were in the consumer
credit market that day. It took care of the wage assignments
that basically had people's paychecks going first to a creditor
before it went to the groceries. It took care of the confession
of judgment clauses that prevented people from raising a
defense, which I can tell you as an old legal aid lawyer where
a lot of people had them, and it took care of the in terrorem
use of some of the tactics.
My first client--the reason I spent 35 years doing this, it
was my very first client who in my very first case, a loan
company wanted to come in and clean out her house, the
furniture in a 72-year-old widow's house, everything down to
the two gray washtubs. And the credit practices rule got rid of
that.
And we have some segments of the market today that use
practices which are a modern-day electronic equivalent of that,
holding checks or the key to somebody's bank account. And they
can do everything that credit practices rule took care of by
the abuses with that check hold. And so we have suggested that
now that we are approaching the silver anniversary of that
credit practices rule, that the FTC review that to see if,
perhaps, we can update that and take care of some of those
abuses again.
And if I still have a couple of minutes left.
Mr. Rush. No. Sorry.
[The prepared statement of Ms. Keest follows:]
[GRAPHIC] [TIFF OMITTED] T2887A.032
[GRAPHIC] [TIFF OMITTED] T2887A.033
[GRAPHIC] [TIFF OMITTED] T2887A.034
[GRAPHIC] [TIFF OMITTED] T2887A.035
[GRAPHIC] [TIFF OMITTED] T2887A.036
[GRAPHIC] [TIFF OMITTED] T2887A.037
[GRAPHIC] [TIFF OMITTED] T2887A.038
[GRAPHIC] [TIFF OMITTED] T2887A.039
[GRAPHIC] [TIFF OMITTED] T2887A.040
[GRAPHIC] [TIFF OMITTED] T2887A.041
[GRAPHIC] [TIFF OMITTED] T2887A.042
[GRAPHIC] [TIFF OMITTED] T2887A.043
[GRAPHIC] [TIFF OMITTED] T2887A.044
[GRAPHIC] [TIFF OMITTED] T2887A.045
[GRAPHIC] [TIFF OMITTED] T2887A.046
[GRAPHIC] [TIFF OMITTED] T2887A.047
[GRAPHIC] [TIFF OMITTED] T2887A.048
[GRAPHIC] [TIFF OMITTED] T2887A.049
[GRAPHIC] [TIFF OMITTED] T2887A.050
[GRAPHIC] [TIFF OMITTED] T2887A.051
[GRAPHIC] [TIFF OMITTED] T2887A.052
[GRAPHIC] [TIFF OMITTED] T2887A.053
[GRAPHIC] [TIFF OMITTED] T2887A.054
[GRAPHIC] [TIFF OMITTED] T2887A.055
[GRAPHIC] [TIFF OMITTED] T2887A.056
[GRAPHIC] [TIFF OMITTED] T2887A.057
[GRAPHIC] [TIFF OMITTED] T2887A.058
[GRAPHIC] [TIFF OMITTED] T2887A.059
[GRAPHIC] [TIFF OMITTED] T2887A.060
[GRAPHIC] [TIFF OMITTED] T2887A.061
[GRAPHIC] [TIFF OMITTED] T2887A.062
[GRAPHIC] [TIFF OMITTED] T2887A.063
[GRAPHIC] [TIFF OMITTED] T2887A.064
[GRAPHIC] [TIFF OMITTED] T2887A.065
[GRAPHIC] [TIFF OMITTED] T2887A.066
[GRAPHIC] [TIFF OMITTED] T2887A.067
[GRAPHIC] [TIFF OMITTED] T2887A.068
Mr. Rush. The Chair now recognizes Mr. Beisner for 5
minutes for his opening statement.
STATEMENT OF JOHN BEISNER
Mr. Beisner. Good afternoon, Chairman Rush and Ranking
Member Radanovich. I am John Beisner. I am a partner at
O'Meleveny & Myers, and I am appearing on behalf of the Chamber
of Commerce and the Chamber's Institute for Legal Reform.
My focus today is a narrow one. It is on section 4 of the
Consumer Credit and Debt Protection Act, which would expand the
authority of the States attorneys general to enforce Federal
credit laws. Under section 4, as I understand it, States would
be empowered to bring civil lawsuits whenever they believe
their residents are harmed by a violation of a regulation
promulgated under the bill or any FTC regulation related to
consumer credit or debt. This legislation is part of a recent
trend to expand State AG authority to enforce Federal laws.
Obviously, protecting consumers from unfair trade practices
is an important legislative goal, but giving State AGs broader
authority to bring civil lawsuits can create some potential for
litigation abuse. The problem is that when State AGs are
authorized to bring lawsuits, the State officials and their
staffs may not be the ones who actually handle the litigation.
Some officials like to hire private attorneys to handle such
cases. Having private attorneys enforce Federal law can create
some problems.
First, when State AGs hire private attorneys, they
frequently do so on a contingency fee basis. In other words,
even though they are working for the States, the private
lawyers are promised a percentage of whatever they win in
court. That makes these contracts very attractive. The private
attorneys get to go into court as a representative of the
State, which gives them instant credibility with the courts;
and if they win, they get to keep a substantial portion of the
money. This is where things get troubling.
Private attorneys are not bound by the same ethical rules
as Federal enforcement officials. As a result, people make
political contributions in the hopes of landing lucrative legal
contracts with the States.
Federal officials are subject to ethics rules that ensure
that decisions to hire private attorneys are not based on
political contributions. Federal officials must also follow
Executive Order 13433, which limits the Federal Government's
ability to hire private attorneys under contingent fee
arrangements. But these laws do not apply when State AGs
contract with private attorneys. The safeguards that protect
the integrity of the Federal enforcement efforts presently do
not apply to the State AGs, even though they may be enforcing
Federal law.
Now, I want to be very clear that the vast majority of
State attorneys general exercise enforcement powers very
responsibly, but there have been some troubling media reports
of State officials handing over large cases to private lawyers
who contributed to their campaigns.
In Mississippi, Attorney General James Hood has been
criticized for hiring friends and contributors on a contingency
fee basis. In Pennsylvania, Governor Rendell faced criticism
for hiring a campaign contributor to sue on behalf of the
State; and Rhode Island State officials have been criticized
for hiring a prominent contributor to State officials to lead
the State's litigation against lead paint companies.
A second problem with contingency fee arrangements is they
can create an incentive for lawyers to pursue cases most likely
to bring them the most money. But when it comes to enforcing
public laws, the most lucrative cases may not be the most
important. Public prosecutors must use their discretion every
day to decide which cases they should pursue in the public
interest, but when attorneys with their own financial interests
are making that decision or participating in those decisions,
public interest considerations may be ignored.
A third problem with contingency fee arrangements in
enforcement actions is that they can shortchange taxpayers.
When government lawyers prevail in litigation, the State gets
all the money. In the contingency fee arrangement, the private
attorneys get a significant percentage, reducing the amount
going to taxpayers.
For these reasons, the Chamber respectfully suggests that
in any legislation expanding State AG authority to enforce
Federal laws, you should consider including safeguards to
protect the public interests and guard against abuses. The
first suggestion would be to require disclosure of private
attorney retention agreements. When State officials hire
private attorneys to enforce Federal law, they should disclose
the arrangements to the U.S. Attorney General for publication
in the Federal Register. Such transparency will help ensure
that Federal laws are implemented consistently and fairly.
Secondly, it is suggested that State officials be barred
from rewarding large campaign contributors with potentially
lucrative contracts to enforce Federal laws.
Finally, it is suggested that the applicability of
Executive Order 13433 be expanded. That order puts limitations
on Federal officials from hiring private lawyers on a
contingency fee basis. The same standard should apply to State
officials enforcing Federal law. These safeguards would help
ensure the transparent, proper use of authority to enforce
Federal law in a manner wholly consistent with the goals of
this legislation.
I thank you for the opportunity to testify today, and I
look forward to answering any questions you may have.
[The prepared statement of Mr. Beisner follows:]
[GRAPHIC] [TIFF OMITTED] T2887A.069
[GRAPHIC] [TIFF OMITTED] T2887A.070
[GRAPHIC] [TIFF OMITTED] T2887A.071
[GRAPHIC] [TIFF OMITTED] T2887A.072
Mr. Rush. The Chair thanks the gentleman and all of the
witnesses.
The Chair recognizes himself for 5 minutes for the purposes
of asking questions of these witnesses.
In the subcommittee's last hearing on consumer credit
issues, I asked the FTC Chairman, John Leibovitz, about the
Commission's record in protecting consumers from unfair and
deceptive practices in the past several years. I noted that the
FTC arguably didn't do enough to stop the mortgage lending
practices during the housing era or housing boom, I might add.
The Chairman argued that the FTC argued that the FTC is
``hamstrung'' by the burdensome rulemaking process under
Magnuson-Moss, and he assured me that if Congress gave the FTC
the authority to issue rules under the Standard Administrative
Procedures Act, the FTC would indeed be more effective in this
particular area. Today we are considering legislation that
would give to FTC this authority that Chairman Leibovitz
requested at one of our hearings.
My question to Ms. Keest--and I would also like to get a
response from Ms. Harrington--Ms. Keest, Congress has duly
given the FTC streamlined rulemaking authority on a case-by-
case basis. We have taken another approach in this bill. The
Chairman has requested we give the FTC broad APA authority to
issue rulings on anything involving consumer credit or debt.
My question is should we trust the FTC's discretion to
essentially use this authority, or will we be better off
sticking with direct rulemaking?
Ms. Keest. I think it is extremely important to give them
discretion for the simple reason that the velocity at which the
market changes is far too fast to have to come back and make a
record every single time.
For example, the last time before Congress passed the
H.R.--the predecessor of H.R. 72, 1728, last week, it had been
15 years before Congress acted on consumer mortgage issues. And
there is a lot that goes on, and there is a lot that the FTC
has on its plate. There is a lot that Congress has on its
plate. And in the meantime, the markets develop and move, and I
don't really think it is feasible to wait for specific
direction as every problem comes up one by one.
Mr. Rush. Ms. Harrington, do you want to comment briefly on
this?
Ms. Harrington. You can trust us.
And let me just tell you, let me give you some examples of
how we used the Administrative Procedures Act rulemaking that
the Congress has given us on a case-by-case basis.
In the area of telemarketing, the Commission issued the
rules that the statute required, and then it went back several
years later and did the ``do not call'' amendment. It took us
less than a year to do that, and I was managing that project.
And at the same time I was managing that project, I was
managing amendments to the FTC's franchise rule, a very
important rule that protects investors in franchises by
requiring that they be given itemized disclosure statements.
It took us 8 years to do that amendment. It took us less
than a year to create ``do not call.'' And that is the way that
we have used our discretionary authority under the
Administrative Procedures Act rulemaking that we have been
given on a case-by-case basis.
Mr. Rush. I know that payday loans play a necessary role in
the economy. Payday loans are available to poor people when no
one else will lend to them. This is especially true of the type
of short-term loans that poor consumers need to get by in
emergencies. And I don't like the fact that people have to take
out payday loans, but it is the reality of where I come from. I
also recognize that there are some extreme and multiple abuses
in the industry, and reform is needed. And I have been a long-
time champion in the Congress of cracking down on this abusive
payday lending.
My question is, how do we regulate the payday loan industry
without destroying it?
Ms. Keest. I think that is one of the areas that we can
take an incremental approach on. There is a lot of controversy,
and there is a lot of experimentation going on with States that
have regulated by different means, ranging from do whatever you
want to prohibition and everything in between. And as time
comes in, we will have a better sense of what works and what
doesn't work.
And in the meantime, I think that the proposal or that the
recommendation that we have made to look at one tactic which I
think is kind of the--it is sort of one of the tools that
really makes things not work so well for consumers is the
check-hold system. So I would very much welcome--and we did, in
fact, recommend that that be one thing that the FTC look at.
And if we could start incrementally there, then we can kind of
work and see what is happening and see what is working out in
the States.
Mr. Rush. The Chair now recognizes the Ranking Member Mr.
Radanovich for 5 minutes.
Mr. Radanovich. Mr. Chairman, I did want to have a
discussion on the States and the attorney generals on the
enforcement of this.
Ms. Harrington, welcome to the committee.
Does the Commission take a position on the State attorney
general enforcement of these laws?
Ms. Harrington. The Commission has favored the scheme under
which Congress has enacted statutes giving the FTC rulemaking
authority and providing the States with enforcement authority
in Federal courts of the rules that are promulgated by the FTC.
We are very supportive of that arrangement.
Mr. Radanovich. Do you worry about inconsistencies and
confusion concerning a broad array of industries if the
rulemaking authorities are given the authority for the attorney
generals to weigh in?
Ms. Harrington. The protection that the Congress has put
into the statutes to make sure that we can guard against that
is the provision that the States notify the FTC before filing
so that we have an opportunity to talk with them and to take a
look at complaints before they are filed. And the FTC also has
the authority, under the statutory provisions that have been
used, to intervene in actions in the event that there is some
concerns about inconsistency.
So I think that the Congress has fairly anticipated that.
And what we have seen now in probably a half a dozen or more
instances in which the Congress has given the FTC specific APA
rulemaking authority is an absence of that kind of
inconsistency. This has worked very well.
Mr. Radanovich. Now, in your opinion, if this bill does
include giving State AGs the enforcement authority, can you
define how it might be given, as narrowly as possible?
Ms. Harrington. If the States are given the authority to
enforce rules issued by the FTC under the statute, then that
would be their authority. It would be very much like
telemarketing, 900 numbers, certain other credit rules that the
States are able to enforce.
Mr. Radanovich. The legislation contains a provision for
any State AG to notify the Commission 60 days in advance of
filing an action, if feasible. Otherwise, it can proceed
without notifying the Commission. Is that a concern for you?
Ms. Harrington. What I would be concerned about is 60 days
is probably way too soon. We do these cases, the States do
these cases. Sometimes it takes fewer than 60 days to work up
the whole case, work up the complaint and be ready to file. So
I think that 60 days is probably unreasonable. And several of
the other statutes provide for notice if feasible, or there is
some term like that.
We haven't had a problem. We work very closely with the
States in consumer protection. We have different working groups
on different subject areas: telemarketing, payment systems,
whatever, their monthly phone calls. Everybody knows what
everybody is doing here. There aren't many surprises in this
area because there is an awful lot of work to do in consumer
protection, and there aren't that many resources at the Federal
and the State level to do it with. So we need to work closely
together, and the left hand needs to know what the right hand
is doing.
Mr. Radanovich. Thank you.
Mr. Beisner, welcome to the committee. I do have a question
regarding the State AGs as well.
Were there no rules promulgated, we could have 52
interpretations of what is fair and deceptive, and that, of
course, would be by 51 attorneys general and the FTC. What is
the likelihood of inconsistent interpretation of the FTC's
standard that it would create confusion and concern in a broad
array of industries, and how could this impact industry at
large?
Mr. Beisner. I should make clear at the outset of
responding to the question that the Chamber has no position on
the delegation of authority to the AGs to enforce.
But I think there is some possibility of inconsistency just
in the decisionmaking about where to enforce the priorities
that would be given to certain areas, enforcement by certain
State attorneys general. So I think there is some possibility
of inconsistency on that just in the enforcement decisions that
would be made when you have got that many people making
decisions about where the enforcement resources should be
devoted.
Mr. Radanovich. How do we make sure that the primacy of
FTC's interpretations of the standard? How do we ensure that
the FTC has primacy?
Mr. Beisner. I think that a methodology for doing that is
through the agency itself making clear its interpretations of
what rules it wishes to enforce on that, and to ensure that the
notice provisions in here and so on are such that the agency
does have the opportunity to participate in making decisions
about enforcement.
Mr. Radanovich. Thank you, Mr. Chairman.
Mr. Rush. The Chair now recognizes the gentlelady from
California, the wonderful coast of California, Ms. Matsui for 5
minutes.
Ms. Matsui. Thank you, Mr. Chairman.
As you know, a government effort has been initiated by the
Treasury Department, HUD, Justice Department, and the FTC to
combat mortgage foreclosure rescue scams and loan modification
fraud. As I mentioned in my opening statement, during debate on
mortgage reform on the Anti-Predatory Lending Act, I offered an
amendment that was included in the final bill to direct the GAO
to evaluate ongoing government actions to combat foreclosure
rescue fraud and to educate consumers about the risk of these
scams.
In addition, I want to thank Chairman Rush for joining me
in sending a letter today to the GAO Comptroller General to
urge him to begin reviewing the administration's efforts to
combat foreclosure rescue scams.
Mr. Chairman, I ask unanimous consent to enter this letter
into the record.
Mr. Rush. Hearing no objection, so ordered.
[The information follows:]
[GRAPHIC] [TIFF OMITTED] T2887A.073
[GRAPHIC] [TIFF OMITTED] T2887A.074
Ms. Matsui. Ms. Keest, your organization prides itself on
preventing mortgage fraud and providing consumer protection for
the consumer in the marketplace. How big a threat are these
foreclosure scams to the American homeowner today?
Ms. Keest. They are a huge threat.
First, I want to thank you, Congresswoman Matsui, for your
leadership on the issue of foreclosures.
It is a chronic problem. And every time the foreclosure
rates rise, they come out of the woodwork. And the best way to
get rid of them is to bring the foreclosure rates down. So
hopefully we can do that. But that being said, they are going
to be a presence.
And so I think it is one of the things that the State AGs
and the States and the FTC I know have all taken to heart and
put it at the top of the priority list, because right now that
is the biggest equity-skimming scam out in there. And so it is
number one right now, I would say.
Ms. Matsui. How would the U.S. actually assess the current
efforts of the government to educate and to get the word out to
the homeowners of these scams?
Ms. Keest. I will say that every time I go on a government
Web site, I see it on its front page, so I recognize that they
are really trying to do things. I don't know how many
homeowners look to the Web pages of government agencies first
when they are faced with that, so I am not sure what the
outcomes would be. I would hope that one of the things that GAO
would do would be to look at and evaluate those kinds of
efforts.
Ms. Matsui. Is there a particular area that you believe
that the government or FTC should focus on to combat these
scams during its rulemaking process?
Ms. Keest. I think I would have to say part of the--one of
the things that they need to do is to make sure that there is
some substantive practices that are prohibited as opposed to
dealing with disclosures, because the disclosures pretty much
can always be worked around. So I would hope they would take
stock of what some of the most common techniques are, the deed
theft issues, that sort of thing, and consider substantively
declaring them to be unfair, which is going to take care of the
inconsistent enforcement problems and level the playing field
for everybody.
Ms. Matsui. That said, I would like to hear more on the
government's efforts to prevent foreclosure rescue and loan
modification scams.
What specific role, Ms. Harrington, does the FTC play in
joining with other government agencies in combating foreclosure
rescue scams?
Ms. Harrington. Multiple roles.
First of all, the FTC operates the Consumer Complaint
Center. It is Consumer Response Center and Consumer Sentinel,
which is the complaint database. So we are the place where
people complain to. And if you go to the Treasury Web site,
makinghomeaffordable.gov, and need to make a complaint, that
will come over to the FTC. So we collect the complaints, number
one.
Number two, we do law enforcement work. In the last year,
we have brought 11 cases against mortgage foreclosure rescue
scams, and we have more in our pipeline.
Number three, we do consumer education. We do it in our Web
site, but also there are a lot of other ways. In the initiative
that we announced on April 6th, we announced that we had
recruited and enlisted some of the largest mortgage servicers,
including Chase, and, I think, Bank of America, and Wells Fargo
and others, to put right in the delinquency notices that go out
to homeowners when they are first behind on their mortgage
payment a warning sheet from us about mortgage foreclosure
rescue scams and how to spot them.
We also made audio recordings, and we gave them to all of
the mortgage-servicing companies to play when people call them
and are put on hold. We have really--and they are good. They
are not like--they are interesting. But they warn people about
what to watch out for.
So we are doing education. We are trying to reach consumers
who are most at risk right at the point of where they are at
risk.
And we continue to work. For example, FinCEN, which is the
Department of Treasury data center where banks and financial
institutions make suspicious activity reports to, the FinCEN
people are working with us. They have created a special team of
analysts to analyze suspicious activity reports concerning
entities that we are watching as possible parties to mortgage
foreclosure fraud. So there is a lot of criminal/civil/cross-
government cooperation on this issue, better than I have ever
seen.
Ms. Matsui. Thank you very much.
Mr. Rush. The Chair now recognizes the Ranking Member of
the full committee Mr. Barton of Texas for 5 minutes--or for 2
minutes.
Mr. Barton. I won't take the 5 minutes.
I have looked--of course, this panel is talking about the
Consumer Credit and Debt Protection Act. The next panel will
talk about the mercury bill. I think it is a good thing to have
these legislative hearings.
I can tell you, Mr. Chairman, that the Republicans on the
subcommittee are on board on moving these bills, but we
certainly think we should take a look at them.
My only question on the Consumer Credit and Debt Protection
Act would be to Mr. Beisner. Your testimony talks about the
potential abuse of giving the attorneys general the authority
to enforce a Federal statute. Is there anything you would care
to elaborate about that?
Mr. Beisner. I think fundamentally the view that we are
trying to express is that when Federal enforcement officials go
about enforcing a law they are subject to a series of ethical
requirements in the way they go about doing that; and what is
being suggested here is that if that authority to enforce
Federal law is being given to State Attorneys General there
ought to be a similar set of safeguards with respect to
enforcement of that law. Not interfering at all with whatever
decisions may be made about enforcing State laws, but the
Federal principles ought to be the same so that there can be
good efforts made to ensure the integrity of that law
enforcement process. And it is just to ensure that that
integrity will be there.
I don't mean, as I said earlier, to suggest that there is
any suggestion that the vast majority of the State Attorneys
General are going off on the wrong track with these enforcement
decisions. But when you give, as some of them do--certainly not
all of them, but some of them do give that enforcement
authority to private attorneys. There is a special need to
ensure that ethical considerations are being observed in that
circumstance. Because they are not government officials, and
they are not subject to the same requirements as a Federal
office of enforcing the law is.
Mr. Barton. Mr. Chairman, that is my only question. We
certainly don't oppose the intent of H.R. 2309. If staff and
members could work on some of the concerns that have just been
raised, I think we could probably reach an accommodation.
But, with that, I yield back.
Mr. Rush. The Chair thanks the Ranking Member, and the
Chair would like to emphasize it is the Chair's intention to
work with the Republicans so that we can come up with a
bipartisan bill. So I think there is a lot of--if we all say--
--
The Chair now recognizes the gentlelady from Illinois, Ms.
Schakowsky, for 5 minutes--or 2 minutes, rather--5 minutes, 5
minutes for purposes of questioning the witnesses.
Ms. Schakowsky. Thank you, Mr. Chairman.
I am wondering--and maybe you said this already. I am
sorry. I had to leave. If you could walk us through how a
single rulemaking under Magnuson-Moss procedures could take 10
years and how the new procedures then would make the agency
more effective in protecting consumers.
Ms. Harrington. Certainly. There are a variety of mandatory
provisions in Magnuson-Moss rulemaking that aren't found in
Administrative Procedures Act rulemaking. For a Magnuson-Moss
rulemaking, there must be an advance notice of proposed
rulemaking. Under APA 553 rulemaking, that is not required. The
NPR not only must be issued but it must address certain
matters, and it must be submitted to Congress in advance so
that the Congress--and the Congress can essentially veto the
rulemaking. That is not true with Administrative Procedures Act
rulemaking.
At the notice of proposed rulemaking stage there are also
very significant differences. Under Magnuson-Moss----
Ms. Schakowsky. Excuse me. Did you already do this for the
committee?
Ms. Harrington. No.
The proposed rule must be based on a Commission
determination that the practice is to be deemed unfair and
deceptive are prevalent. That is, if cease and desist has been
issued against an act or practice or other information
indicates a widespread pattern. There is a requirement of a
showing of prevalence before the notice of proposed rulemaking
can go or has to be included with a notice of proposed
rulemaking. There are no findings of that type required under
the Administrative Procedures Act before an NPR may be issued.
There is also a requirement that the Notice of Proposed
Rulemaking be submitted to Congress 30 days before it is
published in the Federal Register. There is no similar
requirement under the Administrative Procedures Act.
There is a requirement under Magnuson-Moss for a public
comment period. That is not always required under APA
rulemaking. Generally, it is not a public comment period under
an APA rulemaking when there is some sort of emergency rule
that an agency is issuing.
There are express ex parte restrictions under Magnuson-Moss
rulemaking. There aren't under the Administrative Procedures
Act. Although I can tell you as a matter of practice at the FTC
when we do APA rulemaking in the notice, we include ex parte
restrictions. So that is pretty much the same.
OK, here is where it really gets bogged down. Under
Magnuson-Moss, there has to be an opportunity for a public oral
hearing. And if a hearing is requested by anyone--anyone can
request a hearing in a Magnuson-Moss rulemaking--then there has
to be a presiding officer appointed. And there has to be a
supplementary NPR published before any hearing that outlines
the hearing issues which may lead to addition or deletion of
issues based on public comment to the notice of the hearing.
Then there is a process that is required for the
identification of interested parties and their representatives
to attend this hearing. Interested parties have to be given the
opportunity to do direct and cross examination of other
interested parties. So in some of the rulemakings, for example,
the one that Ms. Keest mentioned that went on for 10 years,
interests that did not want this rule to be issued engaged in
perpetual rounds of examination and cross examination.
Then there is a requirement that all of this be
prescribed--transcribed verbatim. And just getting the
stenographer to transcribe, you know, days and weeks and months
of Kathleen cross examining Eileen and Eileen cross examining
Kathleen, this is what is required, that takes time.
Then the staff has to issue a staff report at the end of
all of these hearings, and the presiding officer has to issue a
recommendation or a decision. And then there is a public
comment period required on all of this. That is just at the NPR
stage.
Under the Administrative Procedures Act, generally comments
are submitted in writing. There is no requirement for a public
hearing. At the FTC when we do APA rulemaking, we always do
public workshops. We want to be very transparent. But it
doesn't take very long.
And then at the final rule stage for a Magnuson-Moss rule
there has to be a statement of basis and purpose issued to
accompany the rule; and it must state the prevalence of acts or
practices that are treated by the rule, the manner and context
in which they are unfair or deceptive and the economic effect
of the rule, taking into account small businesses and
consumers.
And specifically on the economic analysis there has to be a
cost-benefit analysis of each of the rules provisions. The
statement of basis and purpose needs to address all of the
comments and explain why the Commission did not adopt any
particular--I see you looking at this and I am going on and on.
And this is just describing it. You know, living it and doing
it takes 10 years.
The Administrative Procedures Act, at the conclusion of the
comment period, a rule can be issued. It needs to contain a
concise and general statement of basis and purpose, not this
really detailed.
And then, finally, the standard for judicial review is
different.
Ms. Schakowsky. I know the chairman is giving me extra
time, but the time is up. I see even just by how long it takes
to explain it how it is. But I am really encouraged by the
notion that we can reach some agreement here, Mr. Chairman; and
I really appreciate that explanation. Thank you.
Mr. Rush. The Chair thanks the gentlelady.
The Chair really thanks these witnesses. You have been
extraordinary in your sharing with the members of the
subcommittee your thoughts, and they are really going to be
taken into much great consideration as we proceed. I just again
want to thank you for taking the time off of your schedule, and
you will be contacted for further input as we proceed.
Let me just ask, if you would, we will keep the record open
for 72 hours, and so within the 72-hour period you may or may
not be getting written questions from members of the
subcommittee, those who are present and those who are not
present. And if you would be really timely in your responses
that certainly would be a benefit to the subcommittee.
Thank you very much, and we will dismiss the first panel.
Thank you so much. It was good. In a respectful manner. Thank
you so much.
Mr. Radanovich. Mr. Chairman.
Mr. Rush. The Chair recognizes Mr. Radanovich.
Mr. Radanovich. Thank you, Mr. Chairman.
I request unanimous consent that three items be included in
the record. That would be a statement of the American Financial
Services Association, the National Automobile Dealers
Association, and the Florida Attorney General Bill McCollum.
Mr. Rush. Hearing no objection so ordered.
Mr. Radanovich. Thank you, Mr. Chairman.
[The information follows:]
[GRAPHIC] [TIFF OMITTED] T2887A.075
[GRAPHIC] [TIFF OMITTED] T2887A.076
[GRAPHIC] [TIFF OMITTED] T2887A.077
[GRAPHIC] [TIFF OMITTED] T2887A.078
[GRAPHIC] [TIFF OMITTED] T2887A.079
[GRAPHIC] [TIFF OMITTED] T2887A.080
[GRAPHIC] [TIFF OMITTED] T2887A.081
[GRAPHIC] [TIFF OMITTED] T2887A.082
[GRAPHIC] [TIFF OMITTED] T2887A.083
[GRAPHIC] [TIFF OMITTED] T2887A.084
[GRAPHIC] [TIFF OMITTED] T2887A.085
[GRAPHIC] [TIFF OMITTED] T2887A.086
[GRAPHIC] [TIFF OMITTED] T2887A.087
[GRAPHIC] [TIFF OMITTED] T2887A.088
[GRAPHIC] [TIFF OMITTED] T2887A.089
[GRAPHIC] [TIFF OMITTED] T2887A.090
Mr. Rush. The Chair now calls the second panel, panel
number II.
The Chair wants to welcome this distinguished panel of
experts who are here to provide input and testify on the bill,
H.R. 2190, the Mercury Pollution Reduction Act; and I will
introduce the panel starting from my left to my right.
First of all, I want to make sure that everybody recognizes
Ms. Catherine O'Neill. She is an Associate Professor of Law in
the Seattle University School of Law.
Next to Ms. O'Neill is Ms. Lynn Goldman, who is a medical
doctor.
Dr. Goldman is a Professor at the Johns Hopkins School of
Public Health.
And seated next to Ms. Goldman is Mr. Richard Jackson. He
is the Executive Vice President of Operations for ASHTA, A-S-H-
T-A, Chemicals.
Again, I want to welcome the witnesses. I want to thank you
for taking the time off of your busy schedules to share with
the subcommittee today.
STATEMENTS OF CATHERINE O'NEILL, ASSOCIATE PROFESSOR OF LAW,
SEATTLE UNIVERSITY SCHOOL OF LAW, MEMBER SCHOLAR, CENTER FOR
PROGRESSIVE REFORM; LYNN GOLDMAN, M.D., M.P.H., PROFESSOR,
JOHNS HOPKINS SCHOOL OF PUBLIC HEALTH, PRINCIPAL INVESTIGATOR,
JOHNS HOPKINS NATIONAL CHILDREN'S STUDY (FORMER EPA ASSISTANT
ADMINISTRATOR FOR PREVENTION, PESTICIDES, AND TOXIC SUBSTANCES,
ADMINISTRATION OF PRESIDENT WILLIAM JEFFERSON CLINTON); AND
RICHARD JACKSON, EXECUTIVE VICE PRESIDENT OF OPERATIONS, ASHTA
CHEMICALS INC.
Mr. Rush. We will begin by testimony from Ms. O'Neill.
Ms. O'Neill, we ask that you pull the mike close to you,
that you turn it on, and that you restrict your comments,
please, to 5 minutes. Thank you and welcome.
STATEMENT OF CATHERINE O'NEILL
Ms. O'Neill. Thank you, Mr. Chairman and members of the
subcommittee.
My testimony makes four points today. First, mercury
contamination poses a grave threat to the neurological health
of children in the United States. The danger for mercury
pollution is particularly acute for groups that rely heavily on
fish as a food source and so raises environmental justice
concerns.
Second, the chlor-alkali industry presents an easy case for
eliminating this toxic pollutant. One simply doesn't need
mercury to produce chlorine and caustic soda. In fact,
alternative technologies that don't use any mercury at all have
been used by the industry for 30 years. Yet four plants in the
U.S. still refuse to update the processes.
Third, the cost of delaying action on these outmoded plants
are large in economic terms and unconscionable in human terms.
For each year of delay, another cohort of children will be born
with neurological damage due to mercury contamination. This
damage is irreversible. While chlor-alkaliplants contribute
only a portion of the mercury releases, it is a portion that is
entirely preventible.
Fourth, H.R. 2190 ensures the long-term viability of the
chlor-alkali plants in the communities they support. Facilities
that convert to the newer, more efficient mercury free
technology are likely to remain competitive and provide jobs
for years to come.
We have long known that mercury is a potent neurotoxin
threatening those exposed in utero and during childhood to even
very small amounts of methylmercury. We have also come to
appreciate that the harms of mercury contamination aren't
distributed equally. Rather, they are borne disproportionately
by groups that rely heavily on fish, including Native
Americans, African Americans, other communities of color and
low-income fishers.
It is not acceptable simply to tell women and children to
stop eating fish for several decades of their lives, yet that
is basically the regulatory strategy we are using. Tennessee,
for example, has recently issued such an advisory for the
stretch of the Hiwassee River adjacent to the Olin chlor-alkali
plant there, warning women and children to eat no fish from the
river due to mercury.
The good news is that mercury releases from the chlor-
alkali industry at least are entirely unnecessary. The industry
developed alternative mercury free technologies years ago.
The phaseout called for by H.R. 2190 very sensibly
capitalizes on this opportunity to eliminate thousands of
pounds of mercury releases each year, while leaving intact the
industry's ability to bring its products to market. Even if, as
the industry suggests, the plants that currently use mercury
can reduce some fraction of their emissions, the point remains
that no mercury releases are necessary for this industry. Given
mercury's potency, even a tiny amount can be harmful. An oft-
quoted illustration is that it takes just a teaspoon of mercury
to contaminate a 25-acre lake. We should therefore be looking
for every opportunity to eliminate mercury releases.
An additional advantage of the newer mercury free
technologies is that they are as much as 37 percent more energy
efficient. While it might seem tempting simply to wait for the
chlor-alkali industry to convert to these more efficient
processes of its own accord, that would be a mistake.
The cost of delaying action on these outmoded plants are
not trivial. For each year of delay, another cohort of children
will be born with neurological damage. Researchers have
estimated that, in fact, as many as 630,000 children are born
each year with neurological damage caused by anthropogenic
sources of mercury. This damage will affect the intelligence
and life prospects of these children for their entire lives. It
is unacceptable to stand by for even a few years and permit
this harm to more children for what amounts to the chlor-alkali
industry's convenience.
Finally, H.R. 2190 takes a long-term perspective on the
viability of the chlor-alkali facilities in the communities
they support. Evidence suggests that plants that use mercury
cell technology merely be able to sustain operations for a few
more years. Plants that have controverted to the more efficient
membrane health technology, by contrast, are likely to be
remain competitive and provide jobs for decades.
In addition, H.R. 2190 functions to stimulate the new jobs
required for the conversion. Recent chlor-alkali plant
conversions have created some 250 such jobs for architects,
designers, plumbers, electricians, and mechanics.
In sum, H.R. 2190 overcomes our current myopia to ensure
the environmental health and economic well-being for all those
affected for the long haul.
Thank you, and I welcome any questions.
Mr. Rush. The Chair thanks Ms. O'Neill.
[The prepared statement of Ms. O'Neill follows:]
[GRAPHIC] [TIFF OMITTED] T2887A.091
[GRAPHIC] [TIFF OMITTED] T2887A.092
[GRAPHIC] [TIFF OMITTED] T2887A.093
[GRAPHIC] [TIFF OMITTED] T2887A.094
[GRAPHIC] [TIFF OMITTED] T2887A.095
[GRAPHIC] [TIFF OMITTED] T2887A.096
[GRAPHIC] [TIFF OMITTED] T2887A.097
Mr. Rush. The Chair recognizes Ms. Goldman for 5 minutes.
STATEMENT OF LYNN GOLDMAN, M.D., M.P.H.
Dr. Goldman. Thank you very much Mr. Rush, and also thank
you to Mr. Radanovich for the opportunity to testify before you
today about H.R. 2190.
My name is Lynn Goldman, and I am a pediatrician and
environmental health scientist and a professor at the Johns
Hopkins School of Public Health who formerly served at the U.S.
EPA as Assistant Administrator for the Office of Prevention,
Pesticides, and Toxic Substances. And I have done research on
mercury and its health effects on children. These comments that
I have represent my point of view and not any point of view of
Hopkins or any other organization I have ever been associated
with.
As you know very well, mercury is a toxic metal; and it
exerts its toxicity on children through formation of
methylmercury in water. And this transformation is almost
inevitable. When there is release of mercury into the
environment, unfortunately, that mercury then contaminates
fish.
There has been a lot of research that has demonstrated the
toxic effects of mercury on the health of children, especially
with in utero exposure; and, in fact, in the year 2000 the
National Academies of Sciences released a report called
Toxicological Effects of Methylmercury that not only documented
these effects but also recommended a limit on exposure, that
is, only 0.1 microgram per kilogram of body weight per day. Or
if you had a 22-pound child we are talking about only 35
billionths of an ounce each day that is allowable. So you can
understand why even what might appear to be small releases of
mercury can amount to quite a bit when it comes to toxicity.
As has already been mentioned, EPA has estimated that
630,000 children every year are born with mercury levels in
their blood that are above this. And in fact in my own research
at Hopkins we can validate this with children in Baltimore.
They are born with too much mercury in their blood.
In the past, there used to be controversy about this. There
was a time when we thought, well, some studies showed the
effects of mercury and others did not. But even studies that in
the past appeared to be negative have now shown to be positive.
Because what happened is that the benefits from eating fish can
blur the effects of mercury.
So very, very tedious and careful methods have been needed
in order to show that, despite the benefits of fish eating,
that mercury itself is hazardous. In fact, over the last few
years after the publication of the National Academy study, we
have three new studies--one in Oswego, New York; one in New
York City after the World Trade Center; and one in Boston--that
all show these effects. I don't think that the effects are at
all disputable in terms of the neurotoxicity of mercury on
babies.
So what do we do? To manage the risk, we tell women of
childbearing age to eat less fish, even though we know that
there are actually benefits of eating fish. Well, then we can
say, only eat the fish that have lower levels of mercury. But
to do that we need to keep the mercury out of the environment.
Because we have the threat of not having fish that women will
find safe to eat if we keep polluting the environment with
mercury. This is a very important issue. It must be addressed.
We know that the ``mercury cell'' chlor-alkali
manufacturing process is not an essential use of mercury. We
know that Japan has phased this out. We know that Europe has
phased this out. We know that we have almost succeeded through
voluntary means of phasing this out in the United States. But,
unfortunately, minus a mandate, we are not going to get to zero
with this issue. We have found that there continue to be a
handful of companies that use the mercury cell process and even
though their production is less than 5 percent of the total
production of chlorine and of caustic soda production that it
continues.
What is the problem with that?
Well, first, it creates the demand for mercury, which means
that there is continued upstream pollution of mercury from
mining, from manufacturing of the mercury.
Second, there are then continued releases of mercury so
that there are downstream releases either through fugitive
emissions from these plants and perhaps in the bodies of the
workers in these plants, certainly demonstrated around the
environment of these plants, and even in the product that is
coming from these plants there are minute amounts of mercury.
So, in conclusion, elimination of mercury cell manufacture
for chlorine and caustic soda will reduce the U.S. emissions of
mercury. It also will contribute to our efforts to reduce
mercury pollution globally. And in my experience with this
issue we have too long taken positions that would say, on the
one hand, let's not take care of this problem in the U.S. until
they take care of it globally and then, on the other hand, for
the current administration walking into global negotiations and
saying we are not going to take care of it globally because it
is basically a domestic problem.
We need to attack this problem on both fronts, and I do
urge support of H.R. 2190. It is in the best interest of our
children. Thank you.
Mr. Rush. Thank you very much, Dr. Goldman.
[The prepared statement of Dr. Goldman follows:]
[GRAPHIC] [TIFF OMITTED] T2887A.098
[GRAPHIC] [TIFF OMITTED] T2887A.099
[GRAPHIC] [TIFF OMITTED] T2887A.100
[GRAPHIC] [TIFF OMITTED] T2887A.101
[GRAPHIC] [TIFF OMITTED] T2887A.102
Mr. Rush. Our final witness is Mr. Jackson.
Mr. Jackson, you are recognized for 5 minutes.
STATEMENT OF RICHARD JACKSON
Mr. Jackson. Good afternoon, Mr. Chairman and members of
the subcommittee. Thank you for the opportunity to testify
before you today concerning H.R. 2190, the Mercury Pollution
Reduction Act of 2009.
My name is Richard Jackson. I am the Vice President of
Operations at ASHTA Chemicals in Ashtabula, Ohio. My testimony
is on behalf of ASHTA and is intended to address the impact
that this bill may have on our company and on the environment.
While others in the chlor-alkali industry may be impacted by
this proposed legislation, we do not intend to speak for them.
ASHTA is a privately held company with offices and its only
production facility in Ashtabula County, Ohio. Our plant has
been in operation since 1964. We currently employ nearly 100
people, with an annual payroll of approximately $7 million in
an economically depressed part of northeast Ohio. We support
local businesses and contractors with close to $2 million in
annual capital investments and over $3 million in annual
expenditures on maintenance, operating supplies, and contracted
services.
While domestic mercury cell production may represent less
than 5 percent of all chlorine caustic soda in the United
States, production of chlorine and potassium hydroxide, or KOH,
using the same mercury cell process represents about 50 percent
of the total production in the United States; and it represents
100 percent of our production. KOH is used as the principal
source of alkalinity in many critical operations, including
cleaning and disinfecting water treatment, liquid fertilizers,
alkaline batteries, photo processing, herbicides, and runway
de-icers, to name just a few. In many of these applications,
there is simply no substitute for KOH.
In our process, mercury is contained in closed electrolytic
cells where it serves as a flowing cathode to extract potassium
from potassium chloride. Strict safety procedures and process
controls are followed to prevent workplace exposure and to
minimize mercury emissions. Today, less than 1/10th of 1
percent of total global mercury emissions comes from the U.S.
chlor-alkali industry; and less than 1/10,000th of 1 percent
comes from ASHTA, as illustrated in Exhibit 1 of our testimony.
ASHTA does not propose to challenge the bill's findings
regarding the effects of mercury on human health in the
environment. However, ASHTA strongly disagrees with the
findings that mercury cell production is obsolete and, most
importantly, that the elimination of mercury cell production by
ASHTA will materially impact the presence of mercury in the
environment.
ASHTA has an excellent environmental health and safety
record and a long history of working in cooperation with
regulatory agencies such as the United States EPA and the Ohio
EPA. We are and have consistently operated within our permits
and in compliance with the regulations that govern our site.
ASHTA has also aggressively improved our environmental
performance by making substantial financial investments to
minimize mercury in water, air, and waste. We have eliminated
the release of storm water and process water from our process
areas in support of the Great Lakes Water Quality Initiative,
and we achieved early compliance with the Maximum Achievable
Control Technology, or MACT, under the mercury cell chlor-
alkali NESHAP regulations.
ASHTA has also completed additional environmental projects
to minimize fugitive emissions from our chlor-alkali process
and work areas. This resulted in a significant reduction in our
air emissions of mercury to less than 1/10th of one gram per
day, which is less than 1/10th of one pound per year.
With the substantial reductions in mercury emissions
achieved by ASHTA we believe that there are no human health or
environmental issues that justify mandating this phaseout of
mercury cell technology. Forced conversion or closure of
ASHTA's facility will have no measurable effect on the global
or local mercury emissions, human health, or the environment of
the United States, the State of Ohio, or the city of Ashtabula,
where most of our employees live and work. It would, however,
have a substantial adverse effect on the KOH supply in the
United States in those businesses which rely on it.
It could also result in the closure of ASHTA's only
production facility and the loss of nearly 100 high-paying
jobs. This in turn would negatively impact many of our
customers and would also result in a large increase in the
number of railcar shipments of chlorine across our Nation's
mainline railroads in order to serve the needs of our adjacent
customer who buys 100 percent of the chlorine we produce.
ASHTA has repeatedly evaluated the economics of converting
our plant to membrane cell technology, and each time we have
concluded that the economic risk to our company did not justify
conversion. Particularly considering our long-standing record
of environmental compliance and at a time when our country and
local community are in the worst economic condition since the
Great Depression, requiring us to make further significant and
financial investment to convert to membrane technology is
unwarranted, it is confiscatory, and it is bad public policy.
Therefore, we urge you to consider the broader impact the
adoption of this bill would have; and we urge you to defeat the
proposed legislation.
Mr. Chairman and members of the subcommittee, thank you for
your valuable time; and I will gladly answer questions at the
appropriate time.
[The prepared statement of Mr. Jackson follows:]
[GRAPHIC] [TIFF OMITTED] T2887A.103
[GRAPHIC] [TIFF OMITTED] T2887A.104
[GRAPHIC] [TIFF OMITTED] T2887A.105
[GRAPHIC] [TIFF OMITTED] T2887A.106
[GRAPHIC] [TIFF OMITTED] T2887A.107
[GRAPHIC] [TIFF OMITTED] T2887A.108
[GRAPHIC] [TIFF OMITTED] T2887A.109
[GRAPHIC] [TIFF OMITTED] T2887A.110
[GRAPHIC] [TIFF OMITTED] T2887A.111
Mr. Rush. The Chair thanks all of the witnesses, and the
Chair recognizes himself for 5 minutes for the purpose of
questioning the witnesses.
According to the EPA, concentrations of mercury in blood
and hair are higher in African Americans than other ethnic
groups. In 2004, a study found in its survey samples that
African American and Mexican American children have higher
mercury hair concentrations than White children; and this study
further linked higher mercury levels with the consumption of
fish.
In her written testimony, Professor O'Neill cites a study
that found that 27.4 percent of women who are Native Americans,
Asian Americans or from the Pacific or Caribbean Islands have
mercury levels that pose a risk to developing fetuses. This is
nearly three times the national average.
My question to both Dr. Goldman and Professor O'Neill, can
you explain the disparate impact on mercury on people of color
and on poor communities?
Dr. Goldman. I can tell you what we know, and that is--and
our research, by the way, shows the same thing--with higher
levels in African American babies at birth and also Asian
babies have higher levels. And what we know is that people who
are poor, in immigrant communities as well are more likely to
fish for subsistence, to go and to get fish in places that have
mercury pollution and where the fish are accumulating that
pollution.
And that is also why--one of the other statistics that you
cited about Native Americans, that is also why often those
populations have more exposure. And we think that that is the
most important reason.
Mr. Rush. Would you care to add some additional comments,
Ms. O'Neill?
Ms. O'Neill. Yes, thank you.
This finding is backed up by the National Environmental
Justice Advisory Council, who in 2002 found the issue of
exposure via fish consumption--because this is the primary
route of exposure to mercury and a number of other pollutants--
to warrant a full-blown study on just this issue. So this
study--and I served as a member of the work group that drafted
it--made just these findings.
And the studies show--and these studies were conducted in
Detroit, Michigan, studies in the south, studies in the
northeast and really all around the country and certainly in
the Pacific Northwest--that when we are talking about these
communities of color, whether we are talking Asian American
communities, African American communities, certainly Native
American communities, that the place of fish, whether both
culturally and economically in their diets and in their lives
is such that they are going to be the ones who are most exposed
and the most harmed by contamination.
Mr. Rush. Thank you.
Mr. Jackson, in your testimony I believe I heard you say
that your company did not alter its production methods because
of the economic impact on your company, that there were
alternatives but you chose not to use alternatives because it
would have an adverse economic impact on your company. Is that
correct?
Mr. Jackson. Had we gone and done some of the conversions
and so forth and put ourselves at financial risk through the
financing of these, it would have put us at way too great a
risk from any reasonable business operation. Basically, we
would have had to choose to put ourselves at such a risk that
we could not effectively compete. And through the markets that
we have been through, effectively it would have been the same
result as what this bill as currently written. It would take us
out of business.
Mr. Rush. So you are saying that you could not afford the
transition from your current method to----
Mr. Jackson. No, we were able to meet and beyond any of the
regulations, all of the current regulations and previous
regulations, regarding environmental compliance. Investment in
those regulations, to meet those regulations, as laid out by
the United States EPA and other regulatory bodies, we complied
with every one and went beyond each one, as I noted in my
testimony; and we saw no reason to take it beyond that level,
because, clearly, we were meeting the objective of the
environmental regulators at that time.
Mr. Rush. Thank you.
The Chair's time has ended. The Chair now recognizes the
Ranking Member for 5 minutes.
Mr. Radanovich. Thank you, Mr. Chairman.
Mr. Jackson, in the world of mercury, whatever you do is
such a small part of that, it seems like. Of the four
industries that this bill affects, it seems to be a small
fraction of the number in the mercury world. Isn't there other
places to look for substantially more reductions than your
industry?
Mr. Jackson. Well, there is still a number of places and
sources of mercury. Europe continues to use more mercury cell
technology than we do for the same process.
Gold mining is one of the most horrific uses of mercury,
especially artisanal miners in the Malaysian area as well as
Brazil and so forth, rain forest areas, unfortunately. These
areas have significant impact on the mercury in the
environment, as well as the power industry through their
continued additional Chinese power plants that go in and put
high-level mercury that is deposited throughout the world, not
just close to the stacks of the Chinese power industry but
throughout the world and effectively hitting every water body
in the world. That is really the source of the mercury.
Mr. Radanovich. Dr. Goldman, I want to ask you a question.
It seems to me the trend right now--and people for energy
purposes are encouraging compact fluorescent light bulbs which
contain mercury. They are going into homes all over the
country. It seems to me that that would be a bigger thing to go
after than it would be something as small as this. What is your
thought on that?
Dr. Goldman. First, to the chlor-alkali mercury cell
technology, Europe is phasing them out by 2020. So they have a
clear deadline for taking them out of production. Globally, it
is a major source; and it is hard for us to tell developing
countries not to do something that we continue to do. I think
you understand that.
But in terms of the compact fluorescents, there are lower
mercury bulbs that have been developed; and I think that the
market--EPA should be pushing the market toward those, as well
as the new LED light bulbs and to move to LED technology that
is a nonmercury technology, which at this point it is not quite
at a place where you can replace light bulbs in your home but
needs to be done.
Because it is a problem, and it is beginning to contribute
quite a bit to not only the potential for breakage in the home
and having to deal with all of that but also that--just another
set of items that we are disposing of that we have to segregate
and so forth, and it is just kind of better to not create that.
As a mom, for me it is just one more thing that I have to
think about segregating and disposing of some special way; and
I would really rather not have to deal with that.
Mr. Radanovich. Isn't it--I think this might be a case
again that we experienced on lead poisoning, a hearing we did
where it is either all or nothing. It seems like any presence
of any mercury anywhere--say, for example, lead is used on a
part of a handlebar on a bicycle, apparently where it needs
some of that malleability to force the handlebars to stay on
straight. And yet the probability of that getting into a child
is--you know, I suppose there is a probability but very, very
small. Isn't this the case that we are seeing here with this,
that nothing is good unless it is all gone?
Dr. Goldman. The thing about lead that is slightly easier
than mercury is it is easier to immobilize. And the thing that
is hard to understand about mercury is that when you see that
little liquid stuff jiggling around that there is vapor coming
off of it, unlike lead which does not vaporize at room
temperature.
Lead can also be a major problem. Kids have gotten lead
poisoning from all kinds of weird things. I have seen a kid get
lead poisoning from sucking on their baby monitor, which who
would let their kid suck on a baby monitor, you know. But there
is all kinds of weird things that can happen. But at least lead
in waste, you can kind of immobilize it.
It is very difficult to immobilize mercury. That is the
major issue. Until it is converted to methylmercury, and then
it doesn't vaporize anymore, but then you have the toxic
compound that is right there in the environment. So it is a
very different kind of a metal.
Even though you are right, in some ways, there are
molecules of mercury that we could chase around forever and
never be able to deal with. And I think you are right to be
pointing to that because you aren't going to be able to get rid
of every molecule in mercury.
Mr. Radanovich. Thank you.
Mr. Jackson, do you think by your company's following the
EPA rules that you follow right now, is that sufficient in your
mind to control the release of mercury?
Mr. Jackson. We believe they are. We think that the EPA
rules have been great guidance as far as our industry. We have
seen much more stringent regulations in the last NESHAP through
the maximum tubal control technology, which basically took our
industry--and the Chlorine Institute has kept records of this
over the last 11 years--has basically taken our industry and
reduced the amount of mercury released from our industry by 94
percent.
ASHTA itself has already taken more than that, down to 98
to 99 percent. We believe fully that the little bit of mercury
that we continue to put out in waste, it is well managed, it is
controlled, it goes into restricted waste landfills, it is
completely immobilized. The mercury in the water--we don't
release any water from our site, but there is no vapor pressure
on the mercury from our product or water. So the idea of a
child breathing mercury or being exposed to it through any of
our products directly is just not really practical.
Mr. Radanovich. Thank you, Mr. Jackson.
I appreciate all the witnesses, and I yield back.
Mr. Rush. The Chair now recognizes the gentlelady from
Illinois, Ms. Schakowsky, for 5 minutes.
Ms. Schakowsky. Mr. Jackson, can you explain to me why the
EPA issued a health advisory in March of this year warning
residents that fish caught in the Ashtabula River were
contaminated with mercury?
Mr. Jackson. I think if you look at fish advisories
throughout the United States the location next to chlor-alkali
industries has very little to do with where fish advisories are
created. The fact is that the areas of which the fish advisory
are I believe are well apart from any outfall that we have ever
had. We currently do not release water at all from our
facility, so we don't feel like we would have impacted a fish
advisory at all.
The Midwest is a large burner of coal, and in coal fires
that are in the releases from coal production energy is put
into the upper atmosphere. It travels west to east. And as you
can look at the Northeast corridor that is where your largest
deposition of mercury has occurred.
Ms. Schakowsky. So you think your plant has nothing to do
with it? I only have 5 minutes. So you are saying you don't
think you have anything to do with it. Aside from no water
emissions, are you saying there is zero air emissions?
Mr. Jackson. No, we are not saying there is zero air
emissions. Less than 1--.1 grams per day is what we have
measured from our facility. Much--probably 10 times less than
the EPA recommended standard.
Ms. Schakowsky. Now, you cited an EPA 1997 report. That is
where you got your numbers. About less than 1/10th of 1 percent
of mercury emissions in the world. Are you aware of the United
Nations Environmental Program study of December, 2008?
Mr. Jackson. I have been looking for that report. I have
not seen the data from it yet.
Ms. Schakowsky. Well, what it says is that, actually, the
chlor-alkali industry is responsible for a significantly higher
proportion of global mercury emissions, 2.43 percent. So
given--and maybe we can get more information from Dr. Goldman,
Ms. O'Neill--but, given those figures, do you still believe
that eliminating the use of mercury and chlor-alkali production
won't make an impact on the presence of mercury in the
environment?
Mr. Jackson. It will not make a measurable impact. You
could take away----
Ms. Schakowsky. Even if it were two point----
Mr. Jackson. Even if you took all the chlor-alkali
industry, mercury cell chlor-alkali industry I would say out of
the world, clearly out of the United States, the impact on the
lakes and rivers and streams and the amount of mercury in the
fish would have virtually no impact.
Ms. Schakowsky. Let me get a response to that from either
one of you, or both.
Dr. Goldman. I think certainly that it would have an
impact, and it would have an impact in the immediate time
period just with the current existing production of these
materials and also the associated mining and smelting that
needs to be done in order to produce the mercury that is
purchased.
But, also, if you look for it into the future and with the
rapid pace of economic development globally, which will
increase the demand for these products of chlorine and alkali,
that if the world continues using this method there will be
even more increase in mercury production, more releases of
mercury. And this is a cumulative, persistent problem.
Ms. Schakowsky. Thank you.
Ms. O'Neill.
Ms. O'Neill. Thank you.
I think it is certainly the case of the natural sources of
mercury that we are not going to be able to control. But the
fact is, and I think Dr. Goldman said it, that when there are
nonessential uses, human made contributions that we can
prevent, we should do so. The impact will be material from this
industry.
Mr. Jackson quoted the emissions of ASHTA, but, of course,
we have to remember that H.R. 2190 would phase out the use from
the entire mercury cell process within the chlor-alkali
industry. And the Chlorine Institute's numbers show releases
from this group on the order of four tons, if you include
releases to the environment and to end products that might end
up in human food, as we have seen from the recent report in the
Washington Post. And potentially as much as eight tons if you
account for the unaccounted for mercury and the fugitive
emissions which EPA still suggests are on the order of
potentially to about half ton per source. So these are not
needed for the processes. We can still bring all these products
to market without the mercury, and as a nonessential source of
mercury it is one that we can eliminate.
Ms. Schakowsky. Thank you.
I would like, Mr. Chairman, to submit for the record a
letter from 43 environmental groups in support of H.R. 2190.
Mr. Rush. Hearing no objection, so ordered.
Ms. Schakowsky. Thank you.
[The information follows:]
[GRAPHIC] [TIFF OMITTED] T2887A.112
[GRAPHIC] [TIFF OMITTED] T2887A.113
[GRAPHIC] [TIFF OMITTED] T2887A.114
[GRAPHIC] [TIFF OMITTED] T2887A.115
Mr. Rush. The Chair thanks the gentlelady.
The Chair now recognizes Mr. Scalise from Louisiana for 5
minutes.
Mr. Scalise. Thank you, Mr. Chairman.
First, a question for Dr. O'Neill.
Your testimony refers to allegations about mercury and high
fructose corn syrup via caustic soda. Dr. Robert Stopford, a
renowned expert on the health effects of mercury who graduated
from Harvard Medical School and directs the toxicology program
at Duke University Medical Center, has conducted research in
this area, but he found that no quantifiable mercury was found
in any of the sampled surveys, and high fructose corn syrup
does not appear to be a measurable contributor in mercury food.
Have you looked at Dr. Stopford's research findings, and if you
can just comment on what he reported.
Ms. O'Neill. And perhaps Dr. Goldman can speak to this as
well.
I am not familiar with that study; and the studies to which
I am referring are the ones recently published in the
Environmental Health Perspectives, where they found that 50
percent of the samples showed measurable quantities of mercury.
My point is not that this is the primary route of
contamination. In fact, we know that fish is the primary route
of human exposure to mercury; and that is the graver source of
concern, particularly given fish's health benefits that we have
to forego if they are contaminated with mercury.
My point is to recognize that if we are using mercury by
this process it ends up somewhere. We have to buy it. It ends
up in the river. It ends up going out the stacks. It goes out
as fugitive emissions into the environment and ends up in the
water and ends up in product as a contaminant. And I think EPA
and the industry and the textbook discussions of the process
recognize that this is necessarily the case when you are using
mercury cell technology.
Mr. Scalise. Dr. Goldman.
Dr. Goldman. I guess I should start by congratulating you,
looking at the sticker on your jacket.
Mr. Scalise. Thank you. I am operating on 3 hours of sleep,
so I apologize.
Dr. Goldman. No, I understand. I have been there.
I have read, actually, that study; and I think that it
probably is true, that they can measure very minute amounts of
mercury and the HFCS. And I also did not think that it was
enough to be concerned about toxicologically. I mean, from the
standpoint of whether you eat that or not, I would be more
concerned for my child to be eating too much high fructose corn
syrup just because it is not the best diet. It is basically the
diet most kids want to eat, and we want them to eat vitamins
and protein and other things.
But I think it is indicative of just kind of the problem
that we generally have probably contamination of mercury in the
environment that is not only through emissions and from plants
and fugitive emissions but possibly in a little bit that goes
out in the product. But I would not want people to be worried
about eating this product on that basis.
Mr. Scalise. A recent U.S. geological survey report found
that methylmercury emissions from around the world, primarily
in Asia, end up in the North Pacific, contaminating 40 percent
of tuna as well as other seafood. Considering the vast
expansion of coal-fired power plants in China and India, how
much do you think that is contributing to some of the things
that you are looking at?
Dr. Goldman. I think it is a major concern. I think there
is pretty good evidence that a large fraction of the mercury
that we are exposed to is local, and another large fraction is
from global emissions, and then there is a lot of it that is
just from reentrainment. Some of the mercury is just deposited
and then reentrains and comes back. So there is recirculation
of mercury that has already been released.
So all of those have to be addressed on different fronts,
and the global emissions I think need to be addressed through
the UNEP and actions to try to get everybody in the world to
take action to reduce mercury emissions. And the fact that
there are many new coal-fired power plants being built in China
every week is a great concern and not just from the standpoint
of mercury but also from the standpoint of global warming that
things need to be done in order to turn that around. You were
talking about 6 billion people in the world, all of whom want
to live just like we do; and we have got to take action to make
sure that the things that seem to be little things----
Mr. Scalise. A lot of them criticize----
Dr. Goldman (continuing). Things that seem to be little,
but if we multiply it times 6 billion, it is not a little, it
is a lot.
Mr. Scalise. Let me ask Mr. Jackson, because it looks like
on the solid waste reporting requirements in Subsection C of
the bill that relate to nonhazard waste--I don't know if you
have looked at that. Would there be any value in your company
actually having to report on its lunchroom trash contents?
Mr. Jackson. We don't see this as any benefit whatsoever.
We see it as onerous upon us. We have no--the idea of our
office waste or food waste from employees, we don't even know
how to manifest it or send it off.
The other thing I think the committee should recognize is
that all even nonhazardous waste landfills are regulated so
that the waste that goes in there, hazardous or nonhazardous,
is basically treated the same as if it were hazardous. So the
release of any potential mercury that could have slipped into
the trash can with an office paper, which is just totally
impractical----
Mr. Scalise. I see I am out of time. I yield back. Thanks.
Mr. Rush. The Chair thanks the gentleman.
This concludes this portion of this hearing. And, again,
the Chair thanks all the participants for your involvement, for
the sacrifice of your very important time. We really appreciate
your contribution to the deliberation of this subcommittee on
these very important issues. Thank you so very much and safe
travels. Thank you. God bless.
Mr. Radanovich. Mr. Chairman.
Mr. Rush. The Chair recognizes the Ranking Member for a
unanimous consent request.
Mr. Radanovich. Thank you, Mr. Chairman.
I ask unanimous consent that the following documents be
included in the printed record: a letter to you and I from
Arthur Dungan of the Chlorine Institute dated May 11, 2009; a
report titled the Assessment of Test Results for Mercury in
High Fructose Corn Syrup by Dr. Woodhall Stopford; a report
titled Normal Mercury Levels in Food and Beverages by Dr.
Woodhall Stopford; a statement from the Corn Refiners
Association dated February 3, 2009; a news release from the
Corn Refiners Association dated March 18, 2009; and a news
release from ChemRisk dated January 30, 2009.
Mr. Rush. Hearing no objection, so ordered.
Mr. Radanovich. Thank you, Mr. Chairman.
[The information appears at the conclusion of the hearing.]
[GRAPHIC] [TIFF OMITTED] T2887A.116
[GRAPHIC] [TIFF OMITTED] T2887A.117
[GRAPHIC] [TIFF OMITTED] T2887A.118
[GRAPHIC] [TIFF OMITTED] T2887A.119
[GRAPHIC] [TIFF OMITTED] T2887A.120
[GRAPHIC] [TIFF OMITTED] T2887A.121
[GRAPHIC] [TIFF OMITTED] T2887A.122
[GRAPHIC] [TIFF OMITTED] T2887A.123
[GRAPHIC] [TIFF OMITTED] T2887A.124
[GRAPHIC] [TIFF OMITTED] T2887A.125
[GRAPHIC] [TIFF OMITTED] T2887A.126
[GRAPHIC] [TIFF OMITTED] T2887A.127
[GRAPHIC] [TIFF OMITTED] T2887A.128
[GRAPHIC] [TIFF OMITTED] T2887A.129
[GRAPHIC] [TIFF OMITTED] T2887A.130
[GRAPHIC] [TIFF OMITTED] T2887A.131
[GRAPHIC] [TIFF OMITTED] T2887A.132
[GRAPHIC] [TIFF OMITTED] T2887A.133
[GRAPHIC] [TIFF OMITTED] T2887A.134
[GRAPHIC] [TIFF OMITTED] T2887A.135
[GRAPHIC] [TIFF OMITTED] T2887A.136
[GRAPHIC] [TIFF OMITTED] T2887A.137
[GRAPHIC] [TIFF OMITTED] T2887A.138
[GRAPHIC] [TIFF OMITTED] T2887A.139
[GRAPHIC] [TIFF OMITTED] T2887A.140
[GRAPHIC] [TIFF OMITTED] T2887A.141
[GRAPHIC] [TIFF OMITTED] T2887A.142
[GRAPHIC] [TIFF OMITTED] T2887A.143
[GRAPHIC] [TIFF OMITTED] T2887A.144
[GRAPHIC] [TIFF OMITTED] T2887A.145
[GRAPHIC] [TIFF OMITTED] T2887A.146
[GRAPHIC] [TIFF OMITTED] T2887A.147
[GRAPHIC] [TIFF OMITTED] T2887A.148
[GRAPHIC] [TIFF OMITTED] T2887A.149
[GRAPHIC] [TIFF OMITTED] T2887A.150
[GRAPHIC] [TIFF OMITTED] T2887A.151
[GRAPHIC] [TIFF OMITTED] T2887A.152
[GRAPHIC] [TIFF OMITTED] T2887A.153
[GRAPHIC] [TIFF OMITTED] T2887A.154
[GRAPHIC] [TIFF OMITTED] T2887A.155
[GRAPHIC] [TIFF OMITTED] T2887A.156
[GRAPHIC] [TIFF OMITTED] T2887A.157
[GRAPHIC] [TIFF OMITTED] T2887A.158
[GRAPHIC] [TIFF OMITTED] T2887A.159
[GRAPHIC] [TIFF OMITTED] T2887A.160
[GRAPHIC] [TIFF OMITTED] T2887A.161
[GRAPHIC] [TIFF OMITTED] T2887A.162
[GRAPHIC] [TIFF OMITTED] T2887A.163
[GRAPHIC] [TIFF OMITTED] T2887A.164
[GRAPHIC] [TIFF OMITTED] T2887A.165
[GRAPHIC] [TIFF OMITTED] T2887A.166
[GRAPHIC] [TIFF OMITTED] T2887A.167
[GRAPHIC] [TIFF OMITTED] T2887A.168
[GRAPHIC] [TIFF OMITTED] T2887A.169
[GRAPHIC] [TIFF OMITTED] T2887A.170
Mr. Rush. The subcommittee now stands adjourned.
[Whereupon, at 4:07 p.m., the subcommittee was adjourned.]
[Material submitted for inclusion in the record follows:]
[GRAPHIC] [TIFF OMITTED] T2887A.171