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

      H.R. 3258, THE DRINKING WATER SYSTEM SECURITY ACT OF 2009, AND H.R.
             2868, THE CHEMICAL FACILITY ANTI-TERRORISM ACT OF 2009

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

                                    HEARING

                                   BEFORE THE

                     SUBCOMMITTEE ON ENERGY AND ENVIRONMENT

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                         ONE HUNDRED ELEVENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                OCTOBER 1, 2009

                                   __________

                               Serial No. 111-68

          Printed for the use of the Committee on Energy and Commerce

                            energycommerce.house.gov
                                    _____

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                        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
    JANICE D. SCHAKOWSKY, Illinois       SUE WILKINS MYRICK, North Carolina
    CHARLES A. GONZALEZ, Texas           JOHN SULLIVAN, Oklahoma
    JAY INSLEE, Washington               TIM MURPHY, Pennsylvania
    TAMMY BALDWIN, Wisconsin             MICHAEL C. BURGESS, Texas
    MIKE ROSS, Arkansas                  MARSHA BLACKBURN, Tennessee
    ANTHONY D. WEINER, New York          PHIL GINGREY, Georgia
    JIM MATHESON, Utah                   STEVE SCALISE, Louisiana
    G.K. BUTTERFIELD, North Carolina
    CHARLIE MELANCON, Louisiana
    JOHN BARROW, Georgia
    BARON P. HILL, Indiana
    DORIS O. MATSUI, California
    DONNA M. CHRISTENSEN, Virgin
        Islands
    KATHY CASTOR, Florida
    JOHN P. SARBANES, Maryland
    CHRISTOPHER S. MURPHY, Connecticut
    ZACHARY T. SPACE, Ohio
    JERRY McNERNEY, California
    BETTY SUTTON, Ohio
    BRUCE BRALEY, Iowa
    PETER WELCH, Vermont
                     Subcommittee on Energy and Environment

                   EDWARD J. MARKEY, Massachusetts, Chairman
    MICHAEL F. DOYLE, Pennsylvania       RALPH M. HALL, Texas
    G.K. BUTTERFIELD, North Carolina     FRED UPTON, Michigan
    CHARLIE MELANCON, Louisiana          ED WHITFIELD, Kentucky
    BARON HILL, Indiana                  JOHN SHIMKUS, Illinois
    DORIS O. MATSUI, California          JOHN B. SHADEGG, Arizona
    JERRY McNERNEY, California           STEVE BUYER, Indiana
    PETER WELCH, Vermont                 GREG WALDEN, Oregon
    JOHN D. DINGELL, Michigan            SUE WILKINS MYRICK, North Carolina
    RICK BOUCHER, Virginia               JOHN SULLIVAN, Oklahoma
    FRANK PALLONE, New Jersey            MICHAEL C. BURGESS, Texas
    ELIOT ENGEL, New York
    GENE GREEN, Texas
    LOIS CAPPS, California
    JANE HARMAN, California
    CHARLES A. GONZALEZ, Texas
    TAMMY BALDWIN, Wisconsin
    MIKE ROSS, Arkansas
    JIM MATHESON, Utah
    JOHN BARROW, Georgia

                                 C O N T E N T S

                                  ----------
                                                                       Page
    Hon. Edward J. Markey, a Representative in Congress from the
      Commonwealth of Massachusetts, opening statement...............     1
    Hon. Fred Upton, a Representative in Congress from the State of
      Michigan, opening statement....................................     3
    Hon. Henry A. Waxman, a Representative in Congress from the State
      of California, opening statement...............................     4
    Hon. Cliff Stearns, a Representative in Congress from the State
      of Florida, prepared statement.................................     6
    Hon. Charlie Melancon, a Representative in Congress from the
      State of Louisiana, opening statement..........................     7
    Hon. Michael C. Burgess, a Representative in Congress from the
      State of Texas, opening statement..............................     8
    Hon. Gene Green, a Representative in Congress from the State of
      Texas, prepared statement......................................     9
    Hon. Lois Capps, a Representative in Congress from the State of
      California, opening statement..................................    10
    Hon. John Sullivan, a Representative in Congress from the State
      of Oklahoma, prepared statement................................    12
    Hon. Joseph R. Pitts, a Representative in Congress from the
      Commonwealth of Pennsylvania, opening statement................    13
    Hon. G.K. Butterfield, a Representative in Congress from the
      State of North Carolina, opening statement.....................    13
    Hon. Joe Barton, a Representative in Congress from the State of
      Texas, prepared statement......................................   116

                                   Witnesses

    Rand Beers, Under Secretary, National Protection and Programs
      Directorate, Department of Homeland Security...................    14
        Prepared statement...........................................    17
        Answers to submitted questions...............................   162
    Peter Silva, Assistant Administrator, Office of Water,
      Environmental Protection Agency................................    30
        Prepared statement...........................................    32
        Answers to submitted questions...............................   186
    Brian Ramaley, Director, Newport News Waterworks, and President,
      Board of Directors, Association of Metropolitan Water Agencies.    52
        Prepared statement...........................................    54
        Answers to submitted questions...............................   194
    Marty Durbin, Vice President, Federal Affairs, American Chemistry
      Council........................................................    67
        Prepared statement...........................................    69
        Answers to submitted questions...............................   200
    Darius Sivin, Legislative Representative, CWA-UAW Legislative
      Alliance.......................................................    78
        Prepared statement...........................................    80
        Answers to submitted questions...............................   203
    Stephen Poorman, International EHS Manager, Fujifilm Imaging
      Colorants, and Chair, Safety and Security Committee, Society of
      Chemical Manufacturers and Affiliates..........................    91
        Prepared statement...........................................    93

                               Submitted Material

    Analysis of H.R. 3258 and H.R. 2868..............................   123
    Letter of September 30, 2009, from American Forest & Paper
      Association to the Committee...................................   137
    Letter of August 11, 2009, from American Water Works Association
      to the Committee...............................................   139
    Letter of September 28, 2009, from chemical and petrochemical
      organizations to the Committee.................................   143
    Statement of Partnership for a Secure America....................   146
    Letter of August 19, 2009, from public interest groups to the
      Committee......................................................   158

      H.R. 3258, THE DRINKING WATER SYSTEM SECURITY ACT OF 2009, AND H.R.
             2868, THE CHEMICAL FACILITY ANTI-TERRORISM ACT OF 2009

                           THURSDAY, OCTOBER 1, 2009

                      House of Representatives,
                Subcommittee on Energy and Environment,
                              Committee on Energy and Commerce,
                                                        Washington, DC.
        The Subcommittee met, pursuant to call, at 10:00 a.m., in
    Room 2123 of the Rayburn House Office Building, Hon. Edward
    Markey [Chairman of the Subcommittee] presiding.
        Members present: Representatives Markey, Butterfield,
    Melancon, McNerney, Green, Capps, Gonzalez, Barrow, Waxman (ex
    officio), Upton, Stearns, Shimkus, Pitts, Walden, Sullivan,
    Burgess and Scalise.
        Staff present: Greg Dotson, Chief Counsel, Energy and
    Environment; Jackie Cohen, Counsel; Melissa Bez, Professional
    Staff Member; Alison Cassady, Professional Staff Member;
    Caitlin Haberman, Special Assistant; Peter Kethcham-Colwill,
    Special Assistant; Dave Leviss, Chief Oversight Counsel; Karen
    Lightfoot, Communications Director, Senior Policy Advisor;
    Lindsay Vidal, Special Assistant; Earley Green, Chief Clerk;
    Matt Eisenberg, Staff Assistant; Jerry Couri, Minority
    Professional Staff; Mary Neumayr, Minority Counsel; and Garrett
    Golding, Minority Legislative Analyst.

    OPENING STATEMENT OF HON. EDWARD J. MARKEY, A REPRESENTATIVE IN
            CONGRESS FROM THE COMMONWEALTH OF MASSACHUSETTS

        Mr. Markey. Good morning, ladies and gentlemen. We welcome
    you to the Subcommittee on Energy and Environment and this very
    important hearing which we are going to conduct today.
        My congressional district is one that harbored Mohamed Atta
    and the other nine who hijacked the two planes from Boston on
    9/11. They walked the streets. They scoped out Logan Airport.
    They took whatever actions it took and for however long it took
    in order to then successfully hijack those two planes with 150
    citizens on them. It was very clear to me that they spent a lot
    of time trying to determine what the line of least resistance
    is in their efforts to attack our country, and at the end of
    those two plane trips unfortunately they were thousands of
    others who perished as well. We have spent much of the last 8
    years in trying to develop strategies in order to reduce
    opportunities for terrorists to exploit our vulnerabilities.
    Since 9/11, we have enacted legislation to secure the aviation,
    maritime, rail, mail transit, nuclear energy and other sectors.
    But what we have yet to do is to act on comprehensive
    legislation to secure the facilities that make or store
    dangerous chemicals. Instead, we have relied on the incomplete
    and inadequate legislative language that was inserted into the
    2007 appropriations bill behind closed doors that amounted to
    little more than a long, run-on sentence.
        The chemical sector represents the best of American
    technological might. Its products help to purify our water,
    make the microchips used in our computers, cell phones and
    military technologies, refine our oil and grow our food. But
    these same chemicals could also be turned into a weapon of mass
    destruction, something that we were reminded of last week when
    we learned of a disrupted terrorist plot to use hydrogen
    peroxide purchased in Colorado for use as a bomb in New York.
    Yet the incomplete 2007 legislation that gave the Department of
    Homeland Security interim authority to regulate chemical
    facilities included several glaring security loopholes. It
    exempted all drinking and wastewater facilities. It exempted
    all maritime facilities. It prevented the Department from
    requiring any specific security measure at any facility. So if
    there was a hole in a fence, DHS couldn't order it to be fixed,
    and if there was a cost-effective alternative to a particular
    chemical or process that greatly would reduce the risk the
    facility posed to the surrounding community, DHS couldn't order
    that either, and it prevented citizens living around these
    facilities from being able to ensure that regulations were
    being met or enforced.
        At the beginning of this Congress, Energy and Commerce
    Committee Chairman Henry Waxman and Homeland Security Committee
    Chairman Bennie Thompson agreed on the need to quickly act to
    comprehensively and permanently ensure the security of all
    facilities containing dangerous chemicals. The chairman agreed
    to work together on two separate pieces of legislation. First,
    we would craft comprehensive chemical security legislation to
    require the Department of Homeland Security to build on the
    good work it has already begun but do so in a manner that
    closed the loopholes included in the interim authority Congress
    provided several years ago. The Chemical Facility Anti-
    Terrorism Security Act of 2009 was introduced following 5
    months of bipartisan Energy and Commerce and Homeland Security
    staff negotiations and has the support of a wide range of labor
    and environmental organizations.
        Second, we would craft legislation to provide EPA with the
    enhanced authority to ensure the security of drinking water
    facilities in recognition of the unique public health role
    these facilities play in providing a safe supply of drinking
    water. The Drinking Water System Security Act of 2009, which is
    exclusively within the jurisdiction of the Energy and Commerce
    Committee, has the support of the environmental and labor
    communities and also the Association of Metropolitan Water
    Agencies whose member utilities provide safe drinking water to
    more than 125 million Americans.
        Though the two pieces of legislation provide authority to
    two different agencies, their intent and purpose is very
    similar. The bills require EPA and DHS to coordinate efforts
    with one another to minimize duplication in order to ensure
    that we make an assignment to one of four risk-based tiers and
    implement the bills' requirements. We want to work together
    with all of the members of the committee as we move forward in
    this process so that we can act wisely and we do so in a way
    that is consistent with the traditions of the committee.
        [The information appears at the conclusion of the hearing.]
        Mr. Markey. Let me now turn and recognize the ranking
    member of the Committee, the gentleman from Michigan, Mr.
    Upton, for an opening statement.

       OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF MICHIGAN

        Mr. Upton. Thank you, Mr. Chairman.
        Like every member on this Committee and in the communities,
    homeland security is a concern and certainly a priority, and
    today we are examining two bills that deal with the security
    implications of facilities that use various chemicals. I do
    have a number of concerns with the bills before us today.
    However, I will primarily focus my remarks on H.R. 2868, the
    Chemical Facility Anti-Terrorism Security Act.
        There have been disagreements about how chemical facilities
    should be regulated to address security issues but Congress was
    able to enact provisions to authorize the DHS to regulate
    security at designated chemical facilities. Rather than enact
    new legislation, we should give DHS the opportunity to fully
    enact the laws that we have already passed. I believe that it
    is too soon for Congress to start over with new regulations. I
    support a 3-year extension of the existing law to give DHS the
    time to finalize implementation of the security regs and allow
    Congress to determine what works and what doesn't, and I prefer
    that to what we are looking at perhaps today.
        We must legislate from a body of experience and accumulated
    evidence, not ideological notions of what sounds like a good
    idea, especially when it means stranding billions of dollars in
    investments at a time when we have frozen domestic financing
    market with the struggling economy. I have been made aware of a
    few real tangible examples on the impacts of this legislation,
    and I recommend to the members of this subcommittee that they
    talk to companies in their districts and States about how the
    legislation would impact them. This legislation is not just
    about chemical facilities. It also covers facilities with
    chemicals too. It isn't something that it just going to hit the
    big guys. Small businesses will be swept in too, then perhaps
    even swept overseas.
        A recent study looked at the impact of inherently safer
    technology, IST, mandate on oil refineries. IST may sound good
    but it is in reality a government-mandated product
    substitution. The study found that in certain terrorist
    situations, sulfuric acid, the mandated IST, can be just as
    dangerous as hydrofluoric acid, which is commonly used today.
    But under the federally mandated IST, the refining process
    would require roughly 250 times more sulfuric acid than
    hydrofluoric. To put this into scale, we are talking about the
    difference between one and two truckloads per month versus
    three to four truckloads each day. The IST, which doesn't make
    us safer, costs between $45 million to $150 million per
    refinery and an increase in operating costs of between 200 to
    400 percent. What do you think would happen to gas prices with
    refineries moving abroad? Between this and cap and trade, we
    will be stuck importing virtually every single gallon of
    gasoline from overseas.
        The problems with this legislation extend beyond the
    economic realm. The citizen lawsuit provisions in the chemical
    plant security bill are completely inappropriate for national
    security legislation. Allowing these types of lawsuits could
    harm security at these facilities, not make it stronger.
    Citizen supervisions in the bill are an over-the-top example of
    why we should not be rushing, especially considering that
    terrorists hire lawyers and could use them. Citizen suits are
    not used in a national defense context and shouldn't be used
    here. Folks should not be able to compel the release of
    roadmaps to destruction by simply using the legal discovery
    process.
        Additionally, the information protection language rolls
    back traditional protections of information that Congress has
    employed since 9/11. It eliminates penalties against those who
    recklessly disclose sensitive information to the public. Even
    though we have been blessed not to have been attacked since 9/
    11, we should not relax our resolve to sanction violators
    swiftly or aggressively.
        In closing, H.R. 2868 would increase costs and send jobs
    abroad without bolstering national security. In fact, an
    argument can actually be made that it weakens our security.
    Chemical manufacturers have already invested millions of
    dollars in chemical security upgrades to ensure that the
    communities where they operate are safe, secure and efficient.
    The requirements in this bill will not improve that security.
    It will only shift the security risks to other sectors such as
    transportation or manufacturing while hindering the economic
    profitability in the process. Hundreds of thousands of jobs
    have been lost over the past year, resulting in plant closures
    and other facilities operating on the margins. Michigan's
    unemployment is still about 15 percent. The chemical industry
    has been hit hard by the economic recession and now is not the
    time to jeopardize those jobs while weakening our national
    security. This isn't the right prescription for making our
    country stronger. We need a bill that secures the economy, not
    just re-engineers and exports. I yield back my time.
        Mr. Markey. The gentleman's time has expired. The chair
    recognizes the chairman of the full Committee, the gentleman
    from California, Mr. Waxman.

    OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN
                 CONGRESS FROM THE STATE OF CALIFORNIA

        Mr. Waxman. Thank you very much, Mr. Chairman.
        Since 2001, federal officials, the Government
    Accountability Office, and outside experts have warned that the
    Nation's drinking water utilities and chemical facilities
    remain vulnerable to terrorist attack. The risk that hazardous,
    but useful, chemicals can be wielded against us is not
    theoretical or abstract. Just last week, we read news accounts
    that the FBI arrested an individual suspected of plotting to
    blow up a federal building using common chemicals purchased at
    a beauty supply store. It doesn't take much imagination to be
    concerned about what a motivated terrorist group could do with
    access to a facility containing large quantities of lethal
    substances.
        The bills we will learn more about today are unfinished
    business from 9/11. They are critical not only to homeland
    security but to the safety of workers at these facilities and
    overall public health.
        First, I would like to note the process by which this
    legislation was developed. At the beginning of this Congress, I
    sat down with Homeland Security Committee Chair Bennie
    Thompson. We agreed that our committees needed to work together
    to address the vulnerability of chemical facilities to
    terrorist attack and other intentional acts.
        The Chemical Facility Anti-Terrorism Act, H.R. 2868, is the
    product of these discussions. This legislation will establish a
    chemical security program to address the threat posed by the
    Nation's vulnerable chemical facilities. Committee staffs on
    both sides of the aisle spent hundreds of hours methodically
    working through these issues.
        The second bill we are discussing today, H.R. 3258, the
    Drinking Water System Security Act, creates a security program
    for drinking water facilities similar to the chemical security
    program. While this legislation is exclusively within the
    jurisdiction of our committee, it also is the product of dozens
    of discussions on both sides of the aisle at the staff level. I
    cannot claim we have achieved consensus on these bills but they
    are well considered and respond to each of the concerns raised.
    I would like to highlight what each of these bills will do.
        The Chemical Facility Anti-Terrorism Act begins with the
    recognition that DHS has made tremendous progress in developing
    a strong chemical security program and gives DHS permanent
    authority to strengthen security at America's chemical
    facilities. It then fills in some important gaps in the
    existing program. The bill requires all covered chemical
    facilities to assess whether they can adopt safer chemicals,
    processes or technologies to reduce the consequences of a
    terrorist attack. The bill gives the Secretary the authority,
    under certain circumstances, to mandate that the riskiest
    facilities adopt safer technology. This is a commonsense policy
    that will help make facilities reduce the likelihood that they
    will become an attractive terrorist target.
        We have also added an important citizen enforcement tool to
    the chemical facility security program where citizens can use
    the provisions to hold DHS accountable for failing to perform
    their duties.
        H.R. 3258, the Drinking Water System Security Act,
    authorizes EPA to create a security program for drinking water
    facilities similar to the chemical security program under DHS.
    There are a couple of important aspects in that bill that
    deserve to be highlighted.
        First, the bill makes permanent EPA's authority under the
    Drinking Water Act to regulate security at drinking water
    facilities. Second, just like the chemical facility bill, this
    bill requires all covered water systems that use a certain
    amount of dangerous chemicals to assess whether they can switch
    to safer chemicals or processes. Since States play a unique
    role in implementing the Safe Drinking Water Act and are most
    familiar with local drinking water concerns, we give the
    States--not EPA--the authority, under certain circumstances, to
    require the riskiest facilities to adopt safer technology.
        We worked closely with the water sector to balance the
    needs of safe drinking water with homeland security concerns,
    and I am pleased that the Association of Metropolitan Water
    Agencies has endorsed H.R. 3258. AMWA is an organization
    representing the largest publicly owned drinking water systems
    in the United States, and we will hear from one of its members
    on the second panel.
        We still have some significant issues to work through on
    these bills and I hope we can find common ground to close these
    security gaps once and for all to make our country safer. Thank
    you, Mr. Chairman.
        Mr. Markey. Great. The gentleman's time has expired. The
    Chair recognizes the gentleman from Florida, Mr. Stearns.

     OPENING STATEMENT OF HON. CLIFF STEARNS, A REPRESENTATIVE IN
                   CONGRESS FROM THE STATE OF FLORIDA

        Mr. Stearns. Thank you, Mr. Chairman.
        I would say to you, Mr. Chairman, and to Mr. Waxman, in
    2002 we passed the Drinking Water Security Act, part of Title
    IV of the Bioterrorism Act. And then we also passed the
    Chemical Plant Security Act in 2006, so I really think we
    should just extend those bills and see if the industry can
    comply. I think the industry is having difficulty complying
    with what we have already passed so I agree with the ranking
    member, Mr. Upton, when he said just have an extension for 3
    years and not start all over, let industry comply with what we
    passed, and as Mr. Upton said, see what works and what doesn't
    work and just correct it. You know, frankly, we haven't had a
    terrorist attack. We have had attempts but we really have not
    had enough to drive these two bills to ask urgent passage, you
    know, and this is particularly a concern of mine when millions
    of Americans have already lost their jobs due to economic
    slowdown and so you put these two bills in place, I think they
    will have a negative effect on raising prices for everyday
    products including food, water, pharmaceutical drugs,
    fertilizers, energy at a time when people can least afford the
    price increase.
        The proposed legislation goes beyond increasing security
    protections by imposing mandates on American manufacturers as
    to which products and processes they will use without any
    regard for practicality and availability or cost. Absent
    federal preemption and a uniform national standard, this
    legislation would create overlapping and conflicting security
    requirements that would cause disruption of federal security
    standards, increase government red tape and obvious create more
    economic instability.
        So I am here at this hearing, Mr. Chairman, but based upon
    what we passed in 2002 and 2006, I think the simple thing to
    do, as Mr. Upton pointed out, just extend the bill, see what
    works, what doesn't work, because these folks are having a hard
    time complying with what we already passed. Thank you, Mr.
    Chairman.
        Mr. Markey. Great. The gentleman's time has expired. The
    Chair recognizes the gentleman from Louisiana, Mr. Melancon.

    OPENING STATEMENT OF HON. CHARLIE MELANCON, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF LOUISIANA

        Mr. Melancon. Thank you, Mr. Chairman. I appreciate the
    opportunity to do an opening statement.
        I too would like to thank you, Mr. Markey, and Chairman
    Waxman for your efforts to bring attention to this very
    important issue.
        My State is particularly affected by the proposals in this
    legislation. Louisiana is home to 61 chemical manufacturing
    companies that have 96 sites and at least 10 refineries
    throughout the State. These sites employ thousands of
    hardworking men and women, oftentimes multiple generations in
    the same plant. These jobs are not minimum-wage employment.
    These jobs pay good salaries and offer a strong set of
    balances. People are paying attention to this bill in
    Louisiana, not only because of its potential impact on jobs and
    employment but plant workers in the communities surrounding the
    facilities are also concerned for their safety. My son, Seth,
    works within the confines of one of those chemical plants along
    the Mississippi River in my district as a safety supervisor,
    and what I have come to learn through the years and especially
    since he has become active in the industry is that the key to
    every one of these facilities is safety, safety, safety. That
    is the number one priority to all of them, management and
    workers.
        Despite existing rigorous safety protocols in these plants,
    there are still national and community security considerations
    addressed in this bill. Some of the chemicals we use every day
    in this country such as chlorine are used to make drinking
    water safe but can also represent a real security hazard in the
    wrong circumstances. As we continue to work toward a final
    bill, we must balance national security with the means to
    ensure that we do not create mandates that will threaten the
    jobs of tens of thousands of workers who are the backbone of
    this vital industry. We must make certain that our efforts do
    not shift rather than eliminate risk. We must examine existing
    models and learn from the success of State chemical security
    plants. Finally, we must guarantee that critical security
    information is not made available to those who might use it to
    harm us.
        The chemical facility security bill being considered today
    has considerable expansions on the original authorization
    passed in 2006 and the motivation for this broadened initiative
    is commendable. However, I encourage my colleagues on this
    committee to keep an open dialog with all parties affected by
    the statute, and remember that while our responsibility to
    secure this Nation from terrorist attacks is paramount, we must
    also have a duty to legislate responsibly and consider all
    sides of the matter.
        I would like to take the opportunity to applaud the groups
    such as American Chemical Council and Crop Life America for
    their contributions in recent months and constructive
    viewpoints from the industry perspective, and I would also like
    to recognize the Blue Green Alliance for their diligence in
    making sure that there are strong protections for both the
    facility employees and surrounding communities. Lastly, I would
    like to thank the Committee staff and the staff of
    Representative Markey for working so hard to try and
    accommodate the interests of this wide variety of affected
    parties. With that, I yield back my time.
        Mr. Markey. Great. We appreciate that. The Chair recognizes
    the gentleman from Texas, Mr. Burgess.

    OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A REPRESENTATIVE
                  IN CONGRESS FROM THE STATE OF TEXAS

        Mr. Burgess. Thank you, Mr. Chairman, and thank you for
    having a hearing on this important issue.
        Securing our Nation's drinking water and chemical
    facilities should be a priority for every Member of Congress,
    indeed, every Congressional district. There is little doubt
    that these are centers where great damage could be inflicted on
    the communities and surrounding areas. It does seem that there
    is disagreement how to go most effectively go about ensuring
    the safety of these facilities while at the same time
    protecting their economic viability. Imposing regulations on
    facilities that are still in the process of implementing
    Congress's last round of regulations does appear to be ill
    advised at this time. Congress last addressed this issue of
    chemical facility security in the homeland security for fiscal
    year 2007 in the appropriations bill. The regulations put in
    place following the enactment of this legislation are in the
    process of being implemented and the Department of Homeland
    Security has yet to make any onsite assessments regarding the
    covered facilities' compliance with the regulations. It seems
    to me a prudent course of action, indeed, if any further
    regulations are necessary, would be to wait until the
    Department of Homeland Security has had an opportunity to
    report back to Congress, study their recommendations and look
    at the success or failure of the current regulations. Chemical
    manufacturing facilities are some of the most highly regulated
    entities in the country, and in many cases for good reason.
    Moving the ball every few years by piling on additional
    regulations without assessing how well the existing rules and
    recently created regulations are working creates both confusion
    and uncertainty for these entities. Having to redo and rewrite
    the security plan every year or two Congress keeps changing
    course means businesses cannot focus on their core mission and
    indeed on their bottom line growing their operations and
    creating more jobs.
        Congress should tread carefully when we consider extending
    security regulations to drinking water facilities including
    facilities that serve relatively small amounts of people. I
    think it is important that we have the dialog that we will have
    today but more investigation is needed as to how to properly
    craft any legislation that would impose new burdens on drinking
    water facilities which are already struggling to meet the
    demands of growing population, specifically in rural areas and
    specifically in rural areas that I represent back in Texas.
        My concerns on both pieces of legislation that we will be
    discussing today center around the mandate of using inherently
    safer technology but it is not always necessarily a one-size-
    fits-all application for all facilities. Further, the
    provisions allowing citizens to bring suits against covered
    facilities pose potential for placing an additional burden on
    our court system and tying up the facilities' resources in
    court proceedings rather than simply making their plants safer.
        I hope the hearing today will be productive and we will
    enter into a dialog of how we may best go about keeping the
    American people safe and keeping chemical plants secure and
    drinking water supplies safe. I look forward to listening to
    the testimony of the panels today and working with others on
    the dais on these matters. Thank you, Mr. Chairman. I will
    yield back.
        Mr. Markey. Great. The gentleman's time has expired. The
    gentleman from Texas, Mr. Green, is recognized.

       OPENING STATEMENT OF HON. GENE GREEN, A REPRESENTATIVE IN
                    CONGRESS FROM THE STATE OF TEXAS

        Mr. Green. Thank you, Mr. Chairman, for holding the hearing
    today on H.R. 2868 and H.R. 3258, the legislation that seeks to
    protect chemical facilities and drinking water systems across
    the country.
        Chemical facility security is especially important to the
    protection of public health and safety and particularly in our
    Congressional district. The Houston Ship Channel area is the
    heart of the largest petrochemical complex in our country that
    stretches along the Texas Gulf Coast, producing many essential
    products for modern life. People who live near and work in
    these facilities deserve the best security possible to prevent
    the risk of death or injury. Our industry, federal, State and
    local law enforcement have been working together since 2001 to
    do this. Chemical facilities have already invested nearly $8
    billion in security improvements since 2001 and are fully
    complying with DHS's Chemical Facility Anti-Terrorism
    Standards, or CFATS, which is not yet fully implemented.
        Today, DHS continues to review thousands of security
    vulnerability assessments to determine the Nation's highest
    risk facilities that require appropriate risk-based security
    measures. Our hearing should shed some light on the progress of
    existing regulations for chemical and drinking water facilities
    so we can learn what is working and what isn't from these
    programs. We need to understand the impact of these pieces of
    legislation on the various responsibilities of EPA, DHS and the
    Coast Guard, which regulates many of the chemical facilities in
    our district under the Maritime Transportation Security Act, or
    MTSA. In 2006, the appropriations rider that authorized CFATS
    exempted MTSA facilities to avoid unnecessary duplication. We
    should continue to avoid overlap of the existing security
    programs including and regarding background checks for
    employees. We have the same agency, Homeland Security and Coast
    Guard looking at one plant that is on the waterside and a
    neighboring plant that may not have a waterside. Those security
    standards should be the same.
        The hearing is also a good opportunity to learn more about
    the risk government concept and inherently safer technology, or
    IST, which is already in use in various chemical facilities
    today. If available, IST can be the most efficient step to
    improve security. The difficulties with IST is whether or how
    to involve government agencies like DHS that have few, if any
    process safety experts, chemical engineers or other qualified
    staff. Hopefully we can promote the adoption of inherently
    safer technology while avoiding unqualified judgments and
    unintended consequences.
        I also question whether broad, private right-to-sue
    authorities similar to civil suit provisions found in
    environmental statutes are appropriate for the security
    legislation. It should at least limit the affected party
    including the neighbors and employees that live near a
    facility.
        Mr. Chairman, I look forward to the testimony of today's
    witnesses so we can learn how to protect our communities with
    feasible and affected standards, and I yield back my time.
        Mr. Markey. Great. The gentleman's time has expired. The
    Chair recognizes the gentleman from Illinois, Mr. Shimkus.
        Mr. Shimkus. Thank you, Mr. Chairman.
        More regulation, more costs, more uncertainty, less jobs.
    It is curious that we would try to move more legislation when
    we haven't fully enacted the previous legislation nor do we
    have a full handle or facilities have been inspected, and that
    is the frustrating thing in this environment that we would move
    to do so. We are talking about more than--based upon language,
    we are talking more than just chemical plants. We are talking
    about farms, hospitals, universities, deep underground wells.
    Based upon this terminology of substance of concern, I call it
    terminology of concern because it is undefined. Chemical
    facility security efforts are not a branch of environmental
    law. The use of inherently safer technology is not a protection
    panacea against terrorism. Citizen suits are not used in
    national defense context and should not be used here.
        The last thing is the preemption regime in these bills
    allows States and localities to enact more stringent laws. That
    is obviously problematic. And with that, Mr. Chairman, I think
    we have a long way to go. We shouldn't rush since the budget
    has a year extension and there are folks who are pushing for
    time to look and review the process that is going on, and I
    yield back my time.
        Mr. Markey. The gentleman's time has expired. The Chair
    recognizes the gentlelady from California, Ms. Capps.

       OPENING STATEMENT OF HON. LOIS CAPPS, A REPRESENTATIVE IN
                 CONGRESS FROM THE STATE OF CALIFORNIA

        Mrs. Capps. Thank you, Mr. Chairman.
        Today we will hear about the threat posed by toxic
    chemicals and the need to ensure the security of those
    chemicals. As has been stated, we will have testimony on two
    bolls that seek to provide essential protections to millions of
    workers and communities now living in the shadow of preventable
    chemical disasters.
        Since 2001, we have had to reorder our priorities as a
    number of issues have taken on new urgency. The security of
    toxic chemicals and our drinking water remains very high on
    this list. Security experts continue to list the Nation's
    chemical and drinking water plants as vulnerable and a deadly
    part of our Nation's infrastructure. The threat is very real
    and it requires immediate action, and that is why Congress must
    act quickly to pass protective and comprehensive legislation.
        H.R. 3258, the Drinking Water System Security Act, is an
    excellent start. This legislation will help us protect and
    secure our Nation from potential acts of terrorism against our
    Nation's drinking water facilities. It advances the use of
    safer, more secure chemicals and technologies where feasible
    and, importantly, involves plant employees in developing
    security programs. I am pleased this bill has the support of
    the Nation's largest water utilities as well as environmental
    and labor groups. This broad coalition shows that this bill
    provides a commonsense approach to securing American's drinking
    water.
        Mr. Chairman, just let me say that I understand the value
    of chemicals in our society. We are not here to question
    whether or not we need chemicals, but as a public health nurse,
    I am well aware of the fact that what we need to do is protect
    those chemicals, especially the most hazardous ones, and also
    protect the employees that handle them every day from terrorist
    threats. Action is long overdue to address these preventable
    chemical disasters. All of us have a responsibility to make
    sure we do all we can to keep this country safe. I hope we can
    enact this legislation as soon as possible to eliminate that
    threat, and I yield back.
        Mr. Markey. Great. The gentlelady's time has expired. The
    Chair recognizes the gentleman from Oklahoma, Mr. Sullivan.
        Mr. Sullivan. I would like to waive my opening statement,
    and I will submit a statement for the record.
        [The prepared statement of Mr. Sullivan follows:]

        Mr. Markey. The gentleman's time will be preserved. The
    Chair recognizes the gentleman from Pennsylvania, Mr. Pitts.

    OPENING STATEMENT OF HON. JOSEPH R. PITTS, A REPRESENTATIVE IN
             CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA

        Mr. Pitts. Thank you, Mr. Chairman. I would like to thank
    you for convening this hearing today on H.R. 2868, the Chemical
    Facility Anti-Terrorism Act, and H.R. 3258, the Drinking Water
    System Security Act.
        I think we can all agree that there is a great need to
    protect our chemical facilities from terrorist attacks. To this
    end, 3 years ago Congress enacted section 550 of the Department
    of Homeland Security Appropriations Act for 2007. This section
    authorizes DHS to regulate security at designated chemical
    facilities. Though the law sunsets in a few days, there has not
    been enough time to fully implement the program. Realizing
    this, the Obama Administration's fiscal year 2010 budget
    recommended a straight 1-year extension of section 550, which
    was included in the fiscal year 2010 Department of Homeland
    Security Appropriations Act. However, there are several new
    provisions in H.R. 2868 that are very concerning.
        First of all, the application of inherently safer
    technology, IST, is not a protection panacea against terrorism.
    The National Petrochemical and Refiners Association says, ``IST
    is not a technique or procedure, it is an engineering
    philosophy. There is no valid method for objectively
    characterizing whether a process is as inherently safe as it
    can be.'' I do not believe it is Congress's role to mandate
    engineering philosophies or chemical substitutions as a
    security cure-all.
        In addition, regarding the citizen suits provisions, there
    is a great concern that every person including terrorists could
    use these types of suits to threaten litigation. Citizen suits
    are not used in a national defense context and should not be
    used here.
        Finally, as I mentioned earlier, the existing program under
    section 550 has not yet been fully implemented. We need a full
    record of what works, what doesn't, what lessons we have
    learned before we change the rules. Mr. Chairman, there is no
    need to race legislation through this committee. Let us allow
    the existing law to be fully implemented, then take a careful,
    reasoned assessment of it.
        I appreciate the witnesses' coming today, and I look
    forward to hearing their testimony. I yield back.
        Mr. Markey. Great. The gentleman's time has expired. The
    Chair recognizes the gentleman from California, Mr. McNerney.
        Mr. McNerney. Thank you, Mr. Chairman. I believe I will
    waive my opening statement.
        Mr. Markey. The chair recognizes the gentleman from North
    Carolina, Mr. Butterfield.

    OPENING STATEMENT OF HON. G.K. BUTTERFIELD, A REPRESENTATIVE IN
               CONGRESS FROM THE STATE OF NORTH CAROLINA

        Mr. Butterfield. Thank you very much, Mr. Chairman, for
    convening this important hearing. You told us at the beginning
    of the session that we would have these hearings and they would
    be forward thinking, and today is certainly an example of that.
        Mr. Chairman, one of the outcomes of that fateful day in
    2001 was our expanded awareness of potential threats and
    vulnerabilities. In the wake of that tragedy on September 11,
    we found renewed responsibility to secure chemical facilities
    and water treatment plants from intentional harm. We are
    exercising that responsibility in the consideration of these
    two pieces of legislation. Though my support for securing these
    facilities is unequivocal, I would be remiss not to convey
    concerns that I have received from some of my constituents with
    regard to the proposed legislation. The authority that grants
    the Secretary of Homeland Security to mandate inherently safer
    technologies troubles many of these constituents that I
    represent. I am appreciative of the language for highlighting
    the Secretary's need to factor economic and cost concerns into
    the final determination on the need for ISTs. I urge that the
    economic consideration provision be as strong as possible,
    given existing incentives and CFATS for covered facilities to
    improve their security.
        Fertilizer producers and retailers in particular have
    expressed concern that the IST provision could be detrimental
    to their businesses. The 1st District in North Carolina is in
    large part agrarian and with many people dependent upon the
    farm economy. Yes, it is farm country for their livelihood.
    Fertilizer is a major input for these farmers and increasing
    the cost of fertilizer has enormous consequences for the bottom
    line of the family farm. This is just one example, Mr.
    Chairman, of economic concerns, and I do hope that we keep
    these concerns and other concerns in mind as we go forward.
        I thank you for convening the hearing. I yield back.
        Mr. Markey. We thank the gentleman very much. All time for
    opening statements has been completed. We will now turn to our
    panel, our very distinguished first panel, and we will hear
    first from Rand Beers, who serves as the under secretary for
    National Protection and Programs Directorate at the U.S.
    Department of Homeland Security. In this role, Mr. Beers
    oversees the coordinated operational and policy functions of
    the directorate's subcomponents which include infrastructure
    protection, risk management and analysis, cybersecurity and
    communications. Mr. Beers previously served on the National
    Security Council staff under Presidents Reagan, Bush, Clinton
    and George W. Bush. So we welcome you, sir. Whenever you are
    ready, please begin.

       STATEMENTS OF HON. RAND BEERS, UNDER SECRETARY, NATIONAL
      PROTECTION AND PROGRAMS DIRECTORATE, DEPARTMENT OF HOMELAND
    SECURITY; AND HON. PETER SILVA, ASSISTANT ADMINISTRATOR, OFFICE
               OF WATER, ENVIRONMENTAL PROTECTION AGENCY

                        STATEMENT OF RAND BEERS

        Mr. Beers. Thank you, Chairman Markey, Ranking Member Upton
    and distinguished members of this Committee. It is a pleasure
    to appear before you today as the committee considers H.R.
    3258, the Drinking Water System Security Act of 2009. This Act
    is intended to close the security gap at drinking water
    facilities that possess substances of concern.
        We have enjoyed a constructive dialog with Congress
    including this Committee as it works on new authorizing
    legislation. The Department recognizes the significant work of
    this Committee and others, particularly the House Committee on
    Homeland Security, that you all have devoted to drafting this
    legislation to reauthorize the CFATS program and to address
    chemical security at the Nation's water systems. We appreciate
    this effort and look forward to continuing the constructive
    engagement with Congress on these important matters.
        CFATS is enhancing security today by helping to ensure
    high-risk chemical facilities throughout the country have
    security postures commensurate with the levels of risk. We have
    made significant progress since the implementation of CFATS in
    2007. CFATS currently covers approximately 6,200 high-risk
    facilities nationwide. The current state of coverage reflects
    changes related to chemicals of interest that facilities have
    made since receiving preliminary tiering notifications in June
    of 2008 including security measures implemented and the
    consolidation or closure or some facilities.
        The following core principles guided the development of the
    CFATS regulatory structure: securing high-risk chemical
    facilities in a comprehensive undertaking that involves a
    national effort including all levels of government and the
    private sector, risk-based tiering that ensures that resources
    are appropriately deployed, reasonable, clear and equitable
    performance standards that will lead to enhanced security, and
    recognition of the progress many companies have already made in
    improving facilities that leverages that advantages.
        It is important to note that the Administration has
    developed a set of guiding principles for this reauthorization
    of CFATS and for addressing the security of our Nation's
    wastewater and drinking water treatment facilities. These
    principles are that the Administration supports a permanent
    chemical facility security authority and a detailed and
    deliberate process in so doing. Hence, our preference for a
    full-scale process that will be completed in fiscal year 2010.
    Nonetheless, CFATS single-year reauthorization in this session
    prevents an opportunity to promote the consideration and
    adoption of inherently safer technology among high-risk
    chemical facilities. We look forward to working with this
    committee and others on this important matter.
        CFATS reauthorization also presents an opportunity to close
    the existing security gap for wastewater and drinking water
    facilities by addressing the statutory exemption of these
    facilities from CFATS. The Administration supports closing this
    gap. The Administration believes that EPA should be the lead
    agency for chemical security for both drinking water and
    wastewater systems with DHS supporting EPA's efforts with its
    security expertise and the leveraging of the CFATS process and
    structure to include the risk-based performance standards,
    tiering methodology, compliance tools, inspector training and
    other support. This will ensure that the water facilities
    identified as high-risk chemical facilities are addressed
    consistently nationwide with modification where necessary to
    reflect the unique characteristics of such facilities.
        With regard to policies surrounding inherently safer
    technology, the Administration had established the following
    policy principles in regard to IST at high-risk chemical
    facilities. The Administration supports consistency of IST
    approaches for facilities regardless of sector, and DHS will be
    responsible for ensuring such consistency. The Administration
    believes that all high-risk chemical facilities, that is tiers
    1 through 4, should assess IST methods and report the
    assessment in the facility security plans. Furthermore, the
    appropriate regulatory entity should have the authority to
    require facilities posing the highest degrees of risk, that is,
    tiers 1 and 2, to implement IST methods if such methods enhance
    overall security are feasible, and in the case of water sector
    facilities especially, though obviously not exclusively, that
    such methods consider public health and environmental
    requirements. With respect to tier 3 and 4 facilities, the
    appropriate regulatory entity should review the IST assessment
    contained in the site security plan and the entity should be
    authorized to provide recommendations on implementing ISTs but
    that entity would not require those facilities to implement
    those IST methods. The Administration believes that flexibility
    and staggered implementation would be required in implementing
    this new IST policy. Clearly, this process could not happen
    overnight and care and the collection of good data will be
    necessary. DHS in coordination with EPA would develop an IST
    implementation plan for timing and phase-in at water facilities
    designated as high-risk chemical facilities. DHS would develop
    an IST implementation plan for other high-risk chemical
    facilities in all other applicable sectors.
        The Administration recognizes that further technical work
    to clarify policy positions regarding IST and water treatment
    security facility is required. The policy positions discussed
    above represent starting points in renewed dialog in these
    important areas. DHS and EPA staff are ready to engage in
    technical discussions with the committee staff, affected
    stakeholders and others to work out remaining technical
    details. We must focus our efforts on implementing a risk- and
    performance-based approach to regulation and in parallel
    fashion continue to pursue the voluntary programs that have
    already resulted in considerable success.
        Again, I thank you for the opportunity to discuss these
    issues with the Subcommittee and look forward to answering your
    questions on this important issue.
        [The prepared statement of Mr. Beers follows:]

        Mr. Markey. Thank you, Mr. Beers, very much.
        Our next witness is Peter Silva. He serves as the assistant
    administrator for water at the Environmental Protection Agency
    where he supervises water office programs, implementing laws
    that include the Safe Drinking Water Act and the Clean Water
    Act. Mr. Silva is a civil engineer with 32 years of experience
    in the field of water and wastewater management. We welcome
    you, sir. Whenever you are ready, please begin.

                        STATEMENT OF PETER SILVA

        Mr. Silva. Thank you. Good morning, Mr. Chairman, Ranking
    Member Upton and member of the Subcommittee. I welcome this
    opportunity to discuss EPA's efforts to promote security and
    resiliency in the water sector with an emphasis on our role in
    addressing chemical security at drinking water facilities.
        I will also reiterate with my colleague from DHS our shared
    conclusion that a critical gap exists with respect to the water
    sector and the framework for regulating the security of
    chemicals in the United States. The subcommittee has
    demonstrated both leadership and thoughtfulness in drafting a
    bill, the Drinking Water System Security Act of 2009, with the
    intention of closing this gap for drinking water systems. In my
    remarks, I will offer some comments on this bill as well as the
    importance of EPA coordinating with DHS in addressing chemical
    security at water and wastewater facilities.
        EPA has worked over the last several years to support the
    water sector in improving security and resiliency, and I am
    pleased to report that the sector has taken its role very
    seriously. EPA has been entrusted with important
    responsibilities for coordinating the protection of the water
    sector through Congressional authorization under the
    Bioterrorism Act of 2002 and through Presidential mandates
    under Homeland Security Presidential Directives 7, 9 and 10.
        Promoting the security and preparedness of the Nation's
    water infrastructure is a priority of this Agency in a post-9/
    11 and post-Hurricane Katrina world. A loss of water service
    can seriously jeopardize the public health, economic vitality
    and general viability of a community. In working with the water
    sector, we have emphasized a multi-layered approach to security
    consisting of prevention, detection, response and recovery. We
    support the Drinking Water System Security Act of 2009 because
    it will enable us to reduce the risks associated with chemical
    security in the water sector without compromising the public
    health and environmental protection standards. We also support
    the structure of the bill as to its tiering process,
    vulnerability and assessments, site security plans, risk-based
    performance standards and other provisions that are consistent
    with the proposed CFATS reauthorization language of H.R. 2868.
        With respect to the inherently safer technology issue, the
    EPA and DHS support the bill's requirement for covered systems
    that use substances of concern above threshold levels to
    conduct assessment methods to reduce consequences, or MRCs.
    This requirement should promote the sector's consideration and
    adoption of safer methods.
        Further, we concur with authorizing the regulatory agency
    to require the highest-risk facilities to implement MRCs under
    certain conditions. Although we find much to support in the
    bill, EPA and DHS share a significant concern that the
    bifurcation of the water sector under two separate bills with
    wastewater facilities covered under H.R. 2868 and drinking
    water facilities covered under H.R. 3258. We urge the committee
    to authorize EPA in coordination with DHS to regulate chemical
    security at both drinking water and wastewater facilities.
        The Committee's bill correctly recognizes the importance of
    coordination between EPA and DHS in regulating chemical
    security in the water sector. EPA and DHS have each acquired
    valuable insight through their respective experience with both
    the water and wastewater sectors. We recommend that EPA utilize
    DHS's chemical security risk assessment tools and performance
    standards and modify as necessary for the water sector.
        In implementing H.R. 3258, we envision that DHS would
    conduct initial reviews of vulnerability assessments and
    recommend risk tier assignments for water and wastewater
    facilities to EPA. DHS also would support EPA's evaluation of
    site security and train inspectors to ensure consistency of
    inspections nationwide. EPA also supports authority for the
    States to implement certain provisions including a prominent
    role in MRC determinations in both auditing and inspections.
        In conclusion, we have made significant progress in
    enhancing the security of our Nation's drinking water and
    wastewater systems. With respect to chemical security, we look
    forward to continuing to work with members of the Committee on
    legislation that ensures the security of substances of concern
    at water and wastewater facilities while supporting the
    critical mission of these facilities for public health
    protection.
        Thank you again for the opportunity to testify about our
    role in water security. I look forward to answering your
    questions.
        [The prepared statement of Mr. Silva follows:]

        Mr. Markey. Thank you very much, Mr. Silva, and again, we
    thank the witnesses for all their hard work and their work with
    our staff in moving towards today. And for the purposes of the
    question-and-answer period, Mr. Beers will be joined by Sue
    Armstrong from the DHS and Mr. Silva will be joined by Cynthia
    Dougherty from the EPA staff if they would like to come up to
    the table, and we welcome you both.
        The Chair will now recognize him and we will begin with
    you, Mr. Beers. There has been, Mr. Beers, many inaccurate
    statements made about the language in the bill that requires
    facilities to assess whether there are safer practices or
    technologies that they could use and for facilities in the two
    highest risk tiers, the language that provides DHS with the
    authority to require them to be used in some cases. Some have
    said that the provision might shift the security risk because a
    company could change the location of the dangerous chemical or
    store it outside the facility's fence. H.R. 2868 says that
    before DHS can require a facility to adopt a safer process or
    technology that it needs to find that there wouldn't be this
    kind of risk shifting. Do you think it makes sense to ensure
    that risk is not shifted?
        Mr. Beers. Mr. Chairman, we certainly are of the view at
    DHS that as we look at any issue with respect to security, be
    it under the mandate that this committee is seeking with
    respect to inherently safer technology or the screening and
    assessment process that DHS already undertakes, that measures
    to reduce risk are not shifting of risk to other areas. That is
    a basic bedrock position that DHS has held up to this point and
    would like to see continued as we consider any kinds of
    security measures.
        Mr. Markey. OK. Thank you.
        Mr. Beers. It does not help us otherwise.
        Mr. Markey. Thank you. And H.R. 2868 says that before DHS
    can require a facility to adopt a safer process or technology
    that it needs to find that the facility would be able to stay
    in business at its current position. Do you think that it makes
    sense for the Department to consider the cost before requiring
    a facility to adopt a safer chemical or process?
        Mr. Beers. Sir, as we look at any kind of legislative
    impact, be it the existing CFATS legislation or what this
    committee has under consideration, we believe quite strongly
    that we have to take into account a number of factors including
    economic considerations in any move to seek facilities to
    change their practices. So in moving forward in an area of
    concern with inherently safer technology, we would certainly
    want to be able to take that into account.
        Mr. Markey. Thank you. Now, there have been some proposals
    to exempt small businesses from some of the requirements to
    assess and implement safer chemicals or processes. Do you
    believe that the risk to the surrounding community is smaller
    just because the business is smaller if al-Qaeda could launch a
    successful attack on a chemical facility that was unprotected?
        Mr. Beers. Sir, the risk process that we undertake in
    reviewing facilities looks at the risk as the risk exists. It
    is not an issue of whether a business is large or small, and
    the risk to a community is not determined by the size of the
    business, it is determined by the size of the risk. So as we
    look at these issues, we would be looking at the size of the
    risk. As I said in answer to my previous question, we would
    also take into account economic considerations, but risk is
    risk, and that is no difference between the size of the
    business.
        Mr. Markey. In your opinion, is it reasonable to assume
    that Mullah Omar and Osama bin Laden in Pakistan right now have
    plans if they could implement them to strike at the United
    States once again?
        Mr. Beers. Sir, it is the view of our intelligence
    community that al-Qaeda and its affiliate organizations still
    represent a risk to the homeland of the United States. We have
    not deviated from that view across a change of Administration
    and the recent events in New York clearly suggest that that
    risk is alive.
        Mr. Markey. And could chemical facilities be a high
    priority target for al-Qaeda within the United States if
    security was inadequate?
        Mr. Beers. We certainly believe that chemical facilities
    represent a potential target. That was the purpose behind the
    original CFATS legislation and we continue to believe that that
    is the case.
        Mr. Markey. Thank you, Mr. Beers, very much.
        Let me turn and recognize the gentleman from Michigan for
    his questions.
        Mr. Upton. Thank you, Mr. Chairman.
        Mr. Beers, you know, the Congress passed in 2006 and funded
    the chemical facility anti-terrorism bill and the 2007
    appropriations bill. How many facilities are actually impacted
    by the legislation in the United States, about? I don't know if
    you know the exact number or not.
        Mr. Beers. I am going to turn to my colleague here, Sue
    Armstrong, to answer that detailed question.
        Ms. Armstrong. Good morning, I will apologize in advance
    for my voice today.
        Mr. Upton. Sounds fine to me.
        Ms. Armstrong. There are currently 6,156 covered facilities
    in the four CFATS tiers.
        Mr. Upton. And if those 6,156 facilities, how many of them
    have been inspected since the bills passed?
        Ms. Armstrong. Well, the first regulatory deadline under
    CFATS was January 22, 2008, to file top screen, which is the
    initial consequence screening that a facility possessing
    appendix A chemicals of interest must file with the Department,
    and at that point in time we had 29,453 top screens in. In June
    of last year, June 23, 2008, we notified 7,010 facilities
    nationwide that they were preliminarily tiered under CFATS and
    needed to do a security vulnerability assessment, again under
    the program, and----
        Mr. Upton. And then you dropped it down to 6,156?
        Ms. Armstrong. Yes.
        Mr. Upton. And of those 6,156, how many of them have you
    actually gone to visit?
        Ms. Armstrong. Well, we have done a number of compliance
    assistance visits over the past year or so to, number one, make
    sure we understand what we are seeing in a security
    vulnerability assessment or if a facility requests a visit we
    will pay them one.
        Mr. Upton. So has that happened? Have you actually visited
    any of these sites?
        Ms. Armstrong. Yes, sir. Compliance assistance visits have
    been occurring regularly. Facilities are also able to visit us
    in Washington for a technical consultation regarding their
    tiering if they want to. We have not begun inspections formally
    yet. We expect to do so in December. The first site security
    plans for a group of tier 1 facilities that were notified of
    their final tiering status this May were due September 15.
        Mr. Upton. OK. The reason I ask that is that I know that in
    the budget request, the President's budget request that was
    made, he sought a 1-year extension of the bill, which as I
    understand it, the Homeland Security appropriation bill is
    going to comply with that. I think there is a 1-year extension
    in both the House and the Senate bill. And as a former OMB
    official, I know that this is about the time of year that the
    agencies submit their requests for the next budget to be
    presented early next year. Can you tell us where the Department
    of Homeland Security is as they look at the 2011 budget? Are
    they going to pursue a 1-year extension again?
        Mr. Beers. No, that is not our intention. That was a good-
    faith effort to indicate that it was our preference that we
    work with the Houses of Congress on a permanent reauthorization
    during fiscal year 2010.
        Mr. Upton. Are you aware from receiving the information
    from these 6,000-some facilities that there are any
    shortcomings in their compliance?
        Ms. Armstrong. We have not taken any enforcement actions
    under the program at this point in time. We did receive
    approximately 6,300 total security vulnerability assessments
    and we have been in the process of reviewing those since they
    were due at the beginning of--or late last year and the
    beginning of this year. We have tier 1, 2 and 3 reviewed
    pending new submissions of top screen and we are reviewing the
    tier 4 vulnerability assessments at this time and continuing to
    make final tiering determination notification.
        Mr. Upton. Mr. Beers, you said in response to Mr. Markey's
    question, you wanted to take into account economic
    considerations of the changes that they are making. Do you have
    any estimate of what these facilities have done financially to
    comply with the regulations that are on the books now? Do you
    have any total costs?
        Ms. Armstrong. While I don't have a total cost, I do know,
    and you can see from the numbers, 7,010 initial preliminary
    tiering notifications and a covered population of 6,156 at this
    point in time. To me, that says that facilities are taking a
    look at their chemical holdings. They are taking a look at
    their internal corporate supply chain and security posture and
    making change. The rule specifically provides that when a
    facility makes a material modification, it needs to refile its
    top screen with us. So we have had thousands of top screen
    resubmissions. We have received 36,960 top screens as of this
    date. So facilities are looking at their holdings, looking at
    their practices and----
        Mr. Upton. I know my time is expired but do you have any
    idea what the cost has been on these facilities to comply?
        Ms. Armstrong. I do not at this point.
        Mr. Upton. Thank you.
        Mr. Markey. The gentleman's time has expired. The Chair
    recognizes the gentleman from Louisiana, Mr. Melancon.
        Mr. Melancon. I will waive questions for right now. Thank
    you.
        Mr. Markey. The Chair recognizes the gentleman from Texas,
    Mr. Green.
        Mr. Green. Thank you, Mr. Chairman.
        Mr. Beers, as you know, H.R. 2868 requires DHS to review
    facilities of IST assessment. In your testimony, you mentioned
    that the infrastructure security compliance is responsible for
    implementing the CFATS, has hired in the process over 125
    people. Can you tell me how many of those 125 people who are
    either on board or in the process are experts in the field of
    chemical engineering, chemical process, safety, design and
    engineering or occupational health, which are only a few fields
    that would be required under IST? Do you have that information
    for us?
        Ms. Armstrong. We have approximately at this point in time
    130 people either on board or in the selection process. Of
    those, we have a number, five or six, who are either civil or
    physical engineers or chemical engineers. We have a chemist on
    site--on staff, sorry--and we have several inspectors who
    joined us from industry.
        Mr. Green. I have to admit, with the state of the industry
    right now, it is probably not a bad time to be out seeking
    someone with a chemical engineering degree, at least in my
    area. What type of expertise do you feel is necessary, DHS, to
    make the IST determinations?
        Ms. Armstrong. Well, I think as with everything we have
    done with the CFATS program, it needs to be an inclusive
    process. It needs to include industry. It needs to include DHS
    security expertise, which we have on staff. It needs to include
    academia. It needs to include the covered facilities themselves
    so we envision as we move forward if this legislation is
    enacted working with the covered community as closely as we
    have in standing up the CFATS program.
        Mr. Green. And that gives me some comfort. And I know you
    are not here representing the Coast Guard, and I have some
    questions regarding the Coast Guard's current security regimen
    under the Maritime Transportation which has been cooperative
    between the industry in my area and the Coast Guard. MTSA's
    requirement is to prevent maritime transportation security
    incidents defined as any incident that results in a significant
    loss of life, environmental damage, transportation system
    disruption or economic disruption in a particular area. Do you
    see this vision significantly different from what H.R. 2868
    seeks to prevent in chemical facilities that may not be
    waterside or under MTSA?
        Mr. Beers. The Secretary of Homeland Security as she was
    becoming familiar with the activities of the Department of
    Homeland Security was informed early on in her tenure of the
    potential for differing enforcement with respect to the Coast
    Guard's responsibilities under MTSA and the NPPD
    responsibilities under CFATS and asked the commandant of the
    Coast Guard and myself to ensure that we work together over the
    course of this year to seek full harmony in terms of the
    implementation between our two regulatory regimes. As a result
    of that, Sue, on behalf of NPPD and a senior flag officer of
    the Coast Guard have a committee that has met and is in the
    process of trying to ensure that those two regulatory regimes
    are in full harmony.
        Mr. Green. Great. Let me--I only have 5 minutes. Do you
    believe this legislation is absolutely clear that MTSA
    facilities only have to deal with one federal agency or one
    subagency of DHS as the Coast Guard, and to follow up, right
    now, and I think a number of members have bought our TWIC card,
    because I spend a lot of times on plant sites in our district,
    it kind of concerns me that a chemical worker at, say, ABC
    Chemical Company at waterside uses a TWIC card, and yet if they
    go to their plant facility at another location it may not have
    waterside but have to have a different set of regimens. Is
    there any way through this legislation or through DHS we can
    harmonize that so it will just make it much more efficient, you
    know, using the TWIC card as a basis?
        Mr. Beers. I understand your concern, Congressman, and that
    is one if the areas obviously that we want to look very
    carefully at to ensure that we have if not a single regulatory
    regime at least a fully harmonized regulatory regime. That card
    issue is an issue that is much broader than just these two
    regimes as well.
        Mr. Green. I know, you know, it covers not only workers. I
    have five refineries and I would say a boatload of chemical
    facilities in my area and I appreciate DHS partnering with our
    community over the years, both the local law enforcement and
    federal law enforcement, to make sure we safeguard.
        Thank you, Mr. Chairman.
        Mr. Markey. Great. We thank the gentleman very much. There
    are three roll calls that we will have to attend to as members
    out on the House Floor and so we will take a brief recess after
    we recognize the gentleman from Illinois, Mr. Shimkus, for his
    5 minutes of questioning.
        Mr. Shimkus. Thank you, Mr. Chairman, and this kind of
    follows up to my opening statement. I appreciate you all being
    here. One of the comments I made was that we are talking about
    farms, hospitals, universities, deep underground wells,
    basically anyone anywhere who possesses a, quote, unquote,
    substance of concern as defined by the legislation. At a June
    29, 2009, meeting to update the chemical sector security
    summit, a leading official at the Department of Homeland
    Security stated that the Department is doing targeted outreach
    to colleges, universities and medical and public health
    facilities. Does this mean that you consider--and this is for
    Mr. Beers--that you consider colleges and universities to be in
    the high-risk tiers?
        Ms. Armstrong. I was actually the official who made that
    statement, so I will elaborate. What I was announcing is that
    we are beginning some targeted outreach for awareness purposes
    in certain segments of industry, colleges and universities and
    public health and health care facilities among them. There are
    currently colleges and universities and other health care
    facilities that are tiered under CFATS. We want to make sure
    that those communities understand the CFATS programs and their
    potential requirements under it and our willingness to work
    with them to incorporate into their security plans their unique
    circumstances.
        Mr. Shimkus. So the answer is yes?
        Ms. Armstrong. The answer is yes, they are.
        Mr. Shimkus. OK. So if yes, they are tiered----
        Ms. Armstrong. Some of them.
        Mr. Shimkus [continuing]. We are talking about colleges and
    universities, are they in tier 1 or tier 2?
        Ms. Armstrong. They are in actually at this point in time
    lower tiers, primarily 3 and 4.
        Mr. Shimkus. Does that mean that DHS considers hospitals
    and other public health clinics or facilities, you are saying
    that they are falling into the lower risk tiers, not in 1 and
    2?
        Ms. Armstrong. Correct.
        Ms. Shimkus. According to this presentation, DHS considers
    certain federal facilities to be outliers. Section 550 exempted
    many federal facilities. Since DHS is having trouble
    implementing section 550 before it expires, what is the
    Department doing chasing entities that it considers outliers
    when you don't have the legal authority to do anything about
    it?
        Ms. Armstrong. Well, we do have the authority to identify
    facilities as high risk based on other considerations and their
    submission of top screen. That is in our rule. What the
    reference to outliers was getting at was, we have worked with
    two States in particular, New York and New Jersey, to have them
    based on their knowledge help us identify facilities in their
    jurisdictions who may have not have filed top screen and need
    to do so.
        Mr. Shimkus. Going back to the opening statement, so we
    have addressed hospitals and universities. What about the issue
    of the terminology, substance of concern, for farms and deep
    underground wells?
        Mr. Beers. The current policy is that there is an extension
    of those entities having to file. That is ongoing.
        Mr. Shimkus. And when will you make a determination?
        Mr. Beers. We have begun a data gathering effort. We expect
    to be issuing some data calls to supplier firms in the not-too-
    distant future. That will be the beginning of the process of
    collecting information in order to make a determination. This
    will be all done publicly and transparently so that affected or
    potentially affected entities will be fully aware of what is
    happening.
        Mr. Shimkus. OK, Mr. Chairman. That is all I have. Thank
    you very much.
        Mr. Markey. The gentleman's time is expired. What we are
    going to do right now is to take a brief recess and we should
    be back here in about 15 minutes to reassemble and to continue
    the questioning. So the committee stands in recess.
        [Recess.]
        Mr. Markey. Welcome back, everybody, and we thank you for
    your patience. There was an extended period of time for the
    roll call. Let me turn and recognize the gentlelady from
    California, Ms. Capps.
        Mrs. Capps. I am still out of breath, Mr. Chairman.
        Mr. Markey. No, good, you made the right decision, though.
    Getting back here first is a big payoff.
        Mrs. Capps. Thank you very much.
        As has already been referenced, and this is for Under
    Secretary Beers again, recent events have demonstrated that we
    live in a world where terrorists can go to a beauty supply
    store in Colorado to secure chemicals for a bomb they intend to
    use for an attack in New York City. Incidents like this
    illustrate how security vulnerabilities in one place can result
    in injuries or deaths all the way across the country. My
    questions are going to be in the area of citizen suit
    provisions. The Administration has not taken a position on
    this. Am I right?
        Mr. Beers. That is correct.
        Mrs. Capps. Well, I would like to frame this in a broader
    context then. Do you agree that broad enforcement of CFATS
    requirements is central to our security?
        Mr. Beers. We certainly believe that the ability to work
    with industry to increase the security and safety for the
    country is absolutely critical. If that requires some kind of
    leverage, then we are prepared to consider it. Obviously we
    prefer not to have to use it----
        Mrs. Capps. Well, let me just sort of work up to that. Is
    it fair to say that the Department perhaps lacks the personnel
    and resources to observe for all violations at all regulated
    facilities at all times?
        Mr. Beers. I am sorry?
        Mrs. Capps. Would it be fair to say that the Department
    lacks personnel and resources to observe for violations at all
    regulated facilities at all times?
        Mr. Beers. Oh, that goes without question. I mean, our
    intent is to be able to visit each of the tier 1 sites in this
    fiscal year and 50 percent of the tier 2 sites based on the
    current resources that we have.
        Ms. Capps. Well, that isn't everywhere at every time. I
    mean, that is kind of omniscient if you were able to do that.
    So that leads me to say, is it possible that neighbors who live
    around a chemical facility and observe it in their neighborhood
    every day may be in a position to spot evidence of security
    violations that the Department of Homeland Security may not be
    aware of on any particular day?
        Mr. Beers. That is possible, yes.
        Mrs. Capps. Well, that is what I am leading to in the area
    of concerns that many neighborhoods have raised about their
    opportunities to recommend and have their concerns addressed in
    this way. Can I ask you what you feel should be done about
    this?
        Mr. Beers. Well, we have a system now in which citizens can
    report their issues or concerns to the Department of Homeland
    Security and it appears at this particular point in time to be
    working. Sue, do you want to add anything?
        Mrs. Capps. Yes, and I would like to add, what are the
    steps that are taken and what kind of guarantee would neighbors
    have that there would be the kind of follow-up that they would
    know about too?
        Ms. Armstrong. Well, what we have done in CFATS
    implementation is to, number one, have a very publicly
    accessible Web site where people can get information about the
    program. It is a subset of the DHS main Web site. And we have
    also established a tip line where an individual can either call
    anonymously or call and identify themselves if they would like
    to be contacted in follow-up to report any kind of security
    concerns.
        Mrs. Capps. Would they have any assurance or is there any
    feedback, is there a procedure that they know this is being
    addressed?
        Ms. Armstrong. Well, if they identify themselves and
    request follow-up, one of our staff will get back to them.
        Mrs. Capps. And is there record of this having happened?
        Ms. Armstrong. Yes.
        Mrs. Capps. So that it is possible that there is a record
    of citizens--well, how about if they are not satisfied with the
    answer. Is there a possibility for legal action?
        Mr. Beers. At this particular point in time, they can
    certainly go to you as their Congressperson or to someone like
    that, but we are dealing with information here in some cases
    where the information that is relevant to the decision that we
    might take for inaction or different action from what they were
    suggesting or requesting. We are not in a position to reveal to
    them the basis for which we would undertake to act differently
    than they thought we ought to act.
        Mrs. Capps. So if they feel that their reporting has not
    been followed up upon to their satisfaction, they have no
    further recourse at this time?
        Mr. Beers. They can come to you.
        Mrs. Capps. They can come to their Member of Congress?
    Well, I am not going to pursue it any further, but this
    committee has a long history with citizen enforcement and
    citizen suit provisions. For close to 40 years this Committee
    has included citizen enforcement provisions in each of our
    environmental laws from the Clean Air Act to the Safe Drinking
    Water Act, and we have now ascertained that this is a valuable
    tool in enforcing our laws. I appreciate your thoughts on this
    matter.
        Thank you very much, Mr. Chairman.
        Mr. McNerney [presiding]. Thank you. The gentlelady's time
    has expired. The Chair recognizes himself for 7 minutes.
        Mr. Silva, I just want to say, my father is a civil
    engineer and I appreciate the work civil engineers do to make
    our country work, and this is certainly an important part of
    it. In your testimony, you mentioned that there was a security
    gap or that a security gap exists. I am going to ask you sort
    of an open-ended question here. What is not part of the
    security gap? In other words, what do you feel good about in
    terms of the security of our Nation's water supplies?
        Mr. Silva. Well, right now I think that the gap is just in
    terms of the fact that we don't have coverage in both the water
    and wastewater sectors, and so with this bill and hopefully
    with further action by the committee, as was mentioned, EPA
    would take the lead in ensuring that those two sectors would be
    covered for security purposes.
        Mr. McNerney. OK, but is there anything you feel good about
    in terms of what part of our water infrastructure do you feel
    is secure and we don't need to worry too much about in terms of
    terrorist attack or so on?
        Mr. Silva. Well, again, right now we do have existing site
    security plans and assessments that we do as part of the Safe
    Drinking Water Act, but again, we feel that there could be a
    gap and so, you know, we would feel more comfortable working
    with DHS to ensure that all facilities are covered and that
    there are more of the tier 1 and tier 2-type facilities out
    there that they could be covered under this.
        Mr. McNerney. All right. What are some of the more
    significant challenges that the EPA might face in meeting the
    obligations under this legislation and do you think that they
    are adequately addressed in H.R. 3258?
        Mr. Silva. Well, I think some of the more principal ones
    probably would be funding for communities to perform the
    inspections, to do the plans and also to carry out any kind of
    changes that would come out of any IST type of review, and so
    we comfortable if we get the legislation through and that we
    have the funding that is available in the legislation that we
    could work with States and communities to fund those types of
    requirements.
        Mr. McNerney. So you don't have any particular
    recommendations then on improving the legislation?
        Mr. Silva. Well, no, again, the recommendation would be
    again to be able to cover both water and wastewater and somehow
    get those two under the same umbrella through EPA, again,
    working with DHS.
        Mr. McNerney. OK, you did mention that in your testimony. I
    appreciate that.
        Mr. Beers, I am going to follow up on a question that Mr.
    Markey asked or a similar question regarding exemptions for
    small businesses, and I understand the need for small
    businesses to be able to move forward and work without too much
    hindrance but I see a potential for a significant risk with
    regard to small business in terms of risk to the population.
    How can you address that?
        Mr. Beers. As I tried to convey, we have a process that
    currently exists in which we are prepared to work with each of
    the facilities that are covered for them to present their
    assessments to work with them with respect to their development
    of responses and plans in order that we can do this in a way
    that both protects public safety and security and at the same
    time doesn't undermine the economic viability of the small-
    business concern. My point earlier, though, was, this is not an
    issue of defining whether the risk is less important because
    the size of the firm is small. The risk doesn't change with
    respect to the size of the firm.
        Mr. McNerney. Well, earlier I think the testimony was that
    there are 6,156 facilities. I think that was the number that
    was given. That is a large number. Do you feel that this
    legislation will increase the risk of layoffs or some of these
    facilities closing because of regulatory burdens that are being
    placed on them by this legislation?
        Mr. Beers. It is certainly not our intention to enforce any
    legislation that Congress should pass that would automatically
    have that effect. We will try to work with all of the concerned
    facilities not to have that kind of an economic impact. That is
    certainly where we start from.
        Mr. McNerney. And Mr. Silva and Mr. Beers, you see
    opportunity for cooperation between your two agencies. There is
    not too much reason why there wouldn't be any hurdles or
    personalities that will cause problems in enforcing this new
    legislation?
        Mr. Beers. One of the, I think, benefits of the process
    with respect to working with this committee is the agreement
    that our two agencies have come to, to think through how we
    would work together and cooperate. Obviously the devil is in
    the details and we will have some other issues that we will
    want to have to work through but I think we have got a really
    solid start here, an ability to work together with EPA in the
    lead.
        Mr. Silva. I would definitely concur with that.
        Mr. McNerney. Well, thank you. That is all the questions I
    have.
        Mr. Upton, do you have any additional questions?
        Mr. Upton. I just want to say, I know Dr. Burgess had some
    questions, and they have a weekly Texas meeting, Texas
    delegation lunch, and I might just ask that we keep the record
    open for questions for members that did not come back so we
    might be able to forward those questions to both of you for a
    response and allow that to be placed into the record if I
    might.
        Mr. McNerney. Without objection.
        Mr. Upton. No one is here to object.
        Mr. McNerney. That concludes our first panel. Thank you for
    coming out here to testify today.
        We now welcome the second panel starting with Brian
    Ramaley. Mr. Ramaley serves as president of the Association of
    Metropolitan Water Agencies, the AMWA, which is an organization
    representing the largest publicly owned drinking water
    providers in the United States. Mr. Ramaley is also a director
    of the Newport News Waterworks in Newport News, Virginia, which
    provides drinking water to more than 400,000 customers. He
    previously served as chairman of EPA's National Drinking Water
    Advisory Council from 2004 to 2007. Thank you, Mr. Ramaley.
    Martin Durbin, who is vice president of federal affairs for the
    American Chemistry Council, where he is responsible for
    directing federal legislative advocacy. In his previous tenure
    leading the ACC's security program, Mr. Durbin was responsible
    for public policy, advocacy, communications and operational
    activities of the association as related to site, cyber and
    value chain security for the business of chemistry. Welcome
    aboard. Thank you for coming. Darius Sivin, Dr. Darius D.
    Sivin. Dr. Darius Sivin served as the legislative
    representative for the international union UAW since November
    2007. His work with the UAW includes 5 years in the UAW health
    and safety department where he conducted numerous workplace
    entries to investigate health and safety issues at a wide
    variety of facilities. Prior to joining the UAW, he was
    employed by the Occupational Safety and Health Administration
    and by the Washington State OSHA program. Dr. Sivin received
    his Ph.D. in environmental and occupational health from the
    Johns Hopkins School of Public Health and his master's in
    environmental studies from Evergreen State College. Thank you
    for participating. Stephen Poorman. Mr. Poorman presently
    serves as the manager of environmental health, safety and
    security for the Fujifilm Imaging Colorants. He also chairs the
    Society of Chemical Manufacturing Affiliates' safety and
    security committee and has been actively involved in chemical
    security issues while serving in this capacity. Mr. Poorman's
    previous experience includes serve as a program supervisor at
    the Ohio Environmental Protection Agency and EHS manager with
    responsibility for chemical security at chemical manufacturing
    sites and corporate headquarters. Thank you for participating.
        I will begin our panel's testimony with Mr. Ramaley. You
    have approximately 5 minutes. Begin when you are ready.

    STATEMENTS OF BRIAN RAMALEY, DIRECTOR, NEWPORT NEWS WATERWORKS,
    AND PRESIDENT, BOARD OF DIRECTORS, ASSOCIATION OF METROPOLITAN
    WATER AGENCIES; MARTY DURBIN, VICE PRESIDENT, FEDERAL AFFAIRS,
         AMERICAN CHEMISTRY COUNCIL; DARIUS SIVIN, LEGISLATIVE
       REPRESENTATIVE, CWA-UAW LEGISLATIVE ALLIANCE; AND STEPHEN
    POORMAN, INTERNATIONAL EHS MANAGER, FUJIFILM IMAGING COLORANTS,
     AND CHAIR, SAFETY AND SECURITY COMMITTEE, SOCIETY OF CHEMICAL
                      MANUFACTURERS AND AFFILIATES

                       STATEMENT OF BRIAN RAMALEY

        Mr. Ramaley. Good afternoon, Mr. Chairman and members of
    this Committee. My name is Brian Ramaley and I am the director
    of Newport News Waterworks which, as you indicated, provides
    drinking water to more than 400,000 people each day in
    southeastern Virginia. I am also the president of the
    Association of Metropolitan Water Agencies, or AMWA, an
    organization that represents the largest publicly owned
    drinking water providers in the United States.
        In my testimony today, I am going to focus on H.R. 3258,
    the Drinking Water System Security Act. AMWA understands that
    H.R. 2868, the Chemical Facility Anti-Terrorism Act, is not
    intended to apply to drinking water systems. However, we
    opposed similar legislation last year, H.R. 5577, that would
    have subjected drinking water systems to federally mandated
    inherently safer technologies through the DHS CFATS program and
    we would do so again this year if such a bill were proposed.
        Turning to the Drinking Water System Security Act of 2009,
    while H.R. 3258 is not perfect, there are several components of
    the bill that enable AMWA to offer it support for that
    legislation. First, it continues EPA's regulation of drinking
    water system security, thus avoiding duplicative requirements
    with DHS. Second, the bill maintains the important concept of
    local choice in water disinfectant and does not allow EPA or
    any other federal entity to broadly force drinking water
    systems across the country to change their disinfection methods
    or chemicals. Instead, the bill requires drinking water systems
    that employ certain chemicals to evaluate the feasibility of
    potential IST operations and decide on their own whether the
    utility will begin using those alternates in the future. Only a
    State drinking water enforcement agency, not EPA, is given a
    direct opportunity to review a utility's analysis and mandate
    the change in disinfectants after considering factors such as
    feasibility, cost and possible water quality implications. I
    must point out that AMWA's acceptance of this State-level
    review is based on our expectation and experience that State
    drinking water enforcement agencies, which have an awareness of
    local water utility operations, will act responsibly when
    reviewing a utility's disinfectant choice. AMWA could not
    support this approach if EPA or another federal agency had the
    direct ability to dictate a State or local water disinfection
    decision.
        Additionally, the bill reflects AMWA's request that the
    current civil penalty, criminal penalties, I should say, of up
    to 1 year in prison and substantial fines be maintained for
    individuals found to have unlawfully distributed protected
    utility information. Any weakening of the penalties for the
    unlawful disclosure of protected information would increase the
    changes of an unauthorized leak of sensitive utility security
    documents and such a leak could provide terrorists and
    criminals with a detailed account of where and precisely how a
    utility's security could best be compromised.
        The legislation does direct EPA to formulate standards to
    facilitate the appropriate sharing of protected information
    with entities such as local first responders, certain water
    utility employees and their union representatives. AMWA looks
    forward to participating in EPA's development of standards that
    will set the ground rules for how this information may be
    accessed.
        Some suggested improvements: AMWA hopes to continue working
    with the committee and other members of Congress to further
    strengthen H.R. 3258. For example, the legislation should
    include an appeals process that a utility may initiate if they
    disagree with their primacy State agency's order to adopt an
    alternate water disinfection method. Because the decision on
    water disinfectants is so critical to public health and public
    health protection, I believe the opportunity to be heard in an
    appeal process is a reasonable request.
        AMWA also remains concerned that the legislation would
    apply only to the Nation's drinking water systems while H.R.
    2868 as approved by the House Homeland Security Committee would
    regulate the security of wastewater utilities under DHS CFATS
    program. I think we have heard today that there is some
    agreement that that should fall under EPA as well. This
    approach would be especially problematic for municipalities
    that operate both water and wastewater systems as do many AMWA
    members as it would force the employees of such systems to
    comply with two varying sets of security rules issued by two
    different federal entities. To resolve this issue, AMWA
    recommends and supports that the security of wastewater
    utilities be regulated under the same EPA program that this
    legislation would apply to drinking water systems and that both
    drinking water and wastewater utilities remain explicitly
    exempt from CFATS.
        In closing, I want to thank the Committee for working with
    AMWA on H.R. 3258. Because of the improvements made to the
    bill, AMWA is pleased to offer its support and hopes to
    continue to work with the Committee to further strengthen the
    bill in the weeks and months ahead.
        That concludes my testimony, and I will defer answering
    questions until the rest of the panel speaks, if that is your
    choice.
        [The prepared statement of Mr. Ramaley follows:]

        Mr. McNerney. Thank you, Mr. Ramaley.
        Mr. Durbin, you may begin.

                       STATEMENT OF MARTY DURBIN

        Mr. Durbin. Mr. Chairman, Mr. Upton, thank you very much
    for the opportunity to again speak with you on this very
    important subject on behalf of the members of the American
    Chemistry Council.
        Having worked on this issue for 8 years and testified
    before Congress on numerous occasions, I know that this issue
    is always accompanied by heated rhetoric and emotion.
    Regardless of what I consider to be significant actions taken
    by all those involved, enormous progress has been made. So
    while there are clearly differences on how best to achieve the
    objectives of securing our Nation's chemical facilities, I
    think it is useful to reflect on what has been accomplished.
        First, after September 11, ACC and many others in the
    chemical industry stepped up and implemented serious, stringent
    security programs at their facilities before there was any
    specific government direction. Second, Congress stepped in and
    enacted national legislation to ensure that these assets, their
    workers and the communities where they operate are protected.
    And third, DHS has acted swiftly to develop and implement
    comprehensive security regulations. CFATS is by far the most
    robust, comprehensive and demanding chemical security program
    to date and DHS should be commended. ACC believes CFATS
    provides a solid foundation and that Congress should provide
    DHS the necessary staff and resources to ensure continued
    success.
        As Congress now analyzes CFATS and identifies areas for
    improvement, ACC is committed to being a constructive partner.
    While our views are not always in alignment, I want to
    acknowledge the willingness of the Energy and Commerce
    Committee and its staff to seek our input and consider our
    viewpoint. We have had constructive discussions and we hope to
    continue working together to make a smart regulatory program
    even better. I believe our common goal is greater than our
    differences.
        ACC's record of accomplishment and cooperation with
    Congress, DHS and other agencies is well established. Since
    2001, our members have invested nearly $8 billion in security
    enhancements under our own Responsible Care Security Code and
    we continue to support strong federal chemical security
    regulations. Our security code not only provided a model for
    chemical security programs in New Jersey, New York and Maryland
    but it was also recognized as an alternative security plan
    under the U.S. Coast Guard's Maritime Transportation Security
    Program.
        Turning to the DHS program, at each step of the regulatory
    development process, our members volunteered to pilot core
    program elements and assist DHS in rapidly and successfully
    developing the tools needed to implement the program and
    swiftly meet their deadlines. CFATS is a tough yet flexible
    program that allows facilities to utilize a full range of
    potential security enhancements including inherently safer
    approaches to address potential security vulnerabilities. This
    is exactly what a strong, smart regulatory approach must do:
    set a high bar through performance-based standards and then
    hold facilities accountable.
        The legislation being considered today by this committee
    represents an important step toward making CFATS permanent. We
    are pleased to see H.R. 2868 reflects many of the security
    measures that will be implemented under CFATS and we appreciate
    the efforts made to minimize duplication of effort by
    facilities that have already acted or will take further action
    under the program. However, I would like to highlight just a
    few provisions we have discussed with the committee where our
    members continue to have questions and concerns. For example,
    we believe the provision that would give DHS authority to
    mandate process changes is unnecessary. Through its use of
    risk-based performance standards, CFATS drives each facility to
    consider all possible risk reduction options including
    inherently safer approaches while developing a site security
    plan. While you can't mandate innovation, CFATS does allow DHS
    to unleash the ingenuity, expertise and resources of the
    chemical sector.
        In addition, we feel the provision that provides for
    private right of action is counterproductive to the ultimate
    success of CFATS. Unlike environmental statutes, CFATS is not a
    series of prescriptive statutory measures like emissions
    standards or discharge limitations. It will therefore be
    difficult for a citizen or a judge to ascertain if a standard
    is being met or to decide what needs to be done to address an
    alleged deficiency. However, let me clear that we fully support
    strong enforcement so we would again urge Congress to provide
    DHS with the necessary tools and resources to ensure
    compliance.
        Also, since employees are the first line of defense when it
    comes to chemical security, we appreciate provisions that
    address employee involvement. One of the core components of
    ACC's Responsible Care Security Code stresses employee
    involvement including training, drills and guidance, so we
    would like to continue to work with the committee to ensure
    that the right people with the right knowledge are involved in
    our efforts to secure chemical facilities.
        The crucial partnership between our industry and the
    federal government requires each of us to do our part. ACC and
    its member companies are committed to safeguarding America's
    chemical facilities and we will continue to work with Congress
    and DHS in that spirit. Thank you.
        [The prepared statement of Mr. Durbin follows:]

        Mr. McNerney. Thank you, Mr. Durbin.
        Mr. Sivin, would you please begin your testimony? Now, we
    just got called so we have about 10 or 15 minutes before we
    need to leave, so there is plenty of time.

                       STATEMENT OF DARIUS SIVIN

        Mr. Sivin. Mr. Chairman, Ranking Member Upton, members of
    the Subcommittee, thank you for the opportunity to testify
    today. I am Dr. Darius Sivin representing the CWA-UAW
    Legislative Alliance. We represent more than 2 million active
    and retired workers who are members of the Communications
    Workers of America and of the international union UAW. Both
    unions represent members who work at facilities potentially
    covered by the legislation before us today. The CWA and the UAW
    strongly support H.R. 2868, the Chemical Facility Anti-
    Terrorism Act of 2009, and H.R. 3258, the Drinking Water System
    Security Act of 2009. We urge the subcommittee and the entire
    House to grant prompt and favorable consideration to these two
    bills. We would not like to see delay beyond the 1-year
    reauthorization already in process. We have heard how enhancing
    the regulation now might strand some costs. Additional delay
    will offer the opportunity for further costs which will
    ultimately be sunk and stranded.
        Chemical security is an issue of great importance to
    organized labor because our members get hurt first and worst in
    case of any attack. CWA and UAW believe that government should
    have the authority to require the higher-risk tiers to
    implement their own plans to reduce the consequences of an
    attack. We have heard examples supposedly of how this would
    result in bad solutions being imposed on industries that would
    increase risk. We disagree because the language of the bill
    clearly says that a solution cannot be imposed unless it would
    reduce risk. The only thing that would have to happen is a
    facility would have to submit an analysis showing that a
    solution would not reduce risk and then they would not have to
    implement it.
        We are very pleased that members on both sides of the aisle
    are concerned about protecting our jobs. Nothing is more
    important to the men and the women of the labor movement than
    the protection of jobs. We want to make it clear that we do not
    believe that anything in the MRC provisions of this
    legislation, H.R. 2868, as introduced is a threat to jobs.
    There does not need to be any additional requirement for
    analysis or administrative law review to protect jobs. We think
    that the addition of additional requirements to the bill as
    introduced would only make it harder to implement necessary
    security measures and would not add any protection of jobs.
        Further, we would like to strongly support Under Secretary
    Beers' statement that the size of the risk is not related to
    the size of the business. We would like the subcommittee to
    move very, very carefully if it seeks to protect small
    businesses. For example, using the Small Business
    Administration's definition of a small business could exempt
    very high-risk facilities including one that puts 12 million
    people at risk. We think it is very important that government
    be able to give weight to the degree of the security risk as
    well as the size of the security.
        We are quite concerned about some of the background checks
    because we think they could provide an opportunity for rare but
    very real unscrupulous employers to go on fishing expeditions,
    and if a fishing expedition is undertaken in the name of
    security, it would be very difficult to question it.
        We would like to see the following improvements made to
    H.R. 2868. First, adverse employment decisions should be made
    only pursuant to a determination by DHS that an individual's
    offenses could cause the individual to be a terrorism security
    risk. Second, employees subject to adverse employment decisions
    should be informed of the basis of the decision and that they
    have a right to appeal and/or file for a waiver as provided by
    H.R. 2868. Third, an employee subject to an adverse employment
    decision should have the option to exercise any rights they
    have under a collective bargaining agreement without losing the
    right to appeal. We are pleased with the language that supports
    participation of employee representatives in both bills. We
    would like to see in the water bill the additional thing
    whereby employee representatives would have a right to a copy
    of the MRC provisions after they are jointly developed, and we
    do not believe there should be any additional stipulations as
    to how employee representatives should be chosen and we do not
    believe employee representatives should be subject to criminal
    penalties for disclosing vulnerability information to those who
    have a legitimate role in fixing problems.
        We think that H.R. 2868 should be amended to give employees
    and their representatives the right to accompany an inspection
    similar to that which they have under OSHA. We also believe
    that to develop public confidence, there needs to be additional
    information made available to the public to allow for
    government accountability for enforcement.
        Finally, I want to reiterate that we support favorable
    action on both these bills and we look forward to continuing to
    work with the Committee to improve them. Thank you on behalf of
    the Communications Workers of America and the international
    union UAW.
        [The prepared statement of Mr. Sivin follows:]

        Mr. Markey. Well, thank you so much, and we have time to
    get in the final opening statement of our witnesses, Mr.
    Poorman, and then we are going to recess again to attend to the
    roll calls on the House Floor and we will then return to
    complete the session.
        So whenever you are ready, please begin.

                      STATEMENT OF STEPHEN POORMAN

        Mr. Poorman. Good afternoon, Chairman Markey, Ranking
    Member Upton, members of the Subcommittee, I am pleased to
    testify before you regarding H.R. 2868, the Chemical Facility
    Anti-Terrorism Act of 2009.
        I speak today on behalf of the Society of Chemical
    Manufacturers and Affiliates. SOCMA represents the batch and
    custom chemical manufacturing industry. Over 70 percent of
    SOCMA's members are small businesses that employ more than
    100,000 workers nationwide. From pharmaceuticals to cosmetics,
    soaps to plastics and all manner of industrial and construction
    products, SOCMA members make materials that save lives, make
    our food supply safe and abundant and enable the manufacture of
    literally thousands of other products. For over 88 years SOCMA
    has partnered with the federal, State and local governments to
    protect America's critical infrastructure.
        SOCMA encourages Congress to make the current risk-based
    CFATS program permanent, or at least to reauthorize it for
    another year. The CFATS program protects our Nation from
    terrorist attacks by requiring thousands of chemical facilities
    nationwide to deploy hardened security measures. Our members
    have spent billions of dollars before and now under CFATS to
    secure their facilities and operations.
        We support those aspects of H.R. 2868 that would codify the
    current CFATS program but we have serious concerns about two
    aspects of the bill: the requirement for mandatory
    implementation of inherently safer technology and the citizen
    suit provision. These provisions are inherently unwise and
    potentially counterproductive to our shared goal of preventing
    terrorist incidents. They would slow and possibly undo the
    progress that industry and DHS have made thus far.
        First, inherently safety is not a simple technology or fix
    despite what you may hear today. Inherent safety is a
    philosophy by which engineers, operations and management work
    together to reduce the level of risk that may be associated
    with a chemical process lifecycle. Inherent safety analysis
    must be conducted very thoughtfully by people who understand
    the process. Empowering even well-intentioned regulators to
    second-guess the judgments of the engineers who know their
    processes best could result in actually increasing or
    transferring overall risks. It could also wreak economic havoc
    on regulated facilities, especially small businesses. Makers of
    active pharmaceutical ingredients and other federally regulated
    substances would be most at risk. For example, one SOCMA member
    is a small business regulated under both CFATS and the rules of
    the Food and Drug Administration. This company produces an
    active pharmaceutical ingredient used in the treatment of life-
    threatening bacterial infections. If a mandated safer
    manufacturing process was outside the terms of the FDA's
    approval, the company would likely be forced to discontinue
    production, lay off workers and increase our Nation's
    vulnerability to grave health threats. Production of that
    crucial ingredient would likely shift to foreign countries
    where FDA is less able to monitor quality standards. The
    world's experts in chemical engineering have told Congress that
    there is no consensus methodology to measure whether one
    process is inherently safer than another. For this reason and
    others, they have consistently recommended against regulating
    inherent safety for security purposes.
        Today, the Administration now supports mandating IST for
    tier 1 and tier 2 facilities when unspecified key criteria are
    met. We acknowledge that DHS officials are sincerely trying to
    do their very best under ever-mounting political pressure but
    it is imperative for Congress to listen to chemical engineers
    and not political scientists. Consistent with the experts'
    recommendations, Congress should direct DHS to submit to a
    report that explains in detail how DHS intends to compare
    various IST alternatives. Such a report should be developed
    with broad participation by the expert community and
    stakeholders. DHS should be allowed to focus all its other
    resources on completing the current CFATS program.
        Secondly, we strongly oppose applying environmental laws
    citizen suit provisions to security laws. We are concerned that
    no matter what protections courts impose, sensitive security
    information inevitably will be disclosed and could be used by
    terrorists to target a facility and its surrounding
    communities. A citizen suit provision will also divert needed
    resources from DHS's efforts to finish implementing and
    enforcing CFATS. If people believe they see security
    weaknesses, they have effective options now such as calling the
    CFATS tip line at 1-877-FYI-4DHS.
        Again, SOCMA supports permanent risk-based chemical site
    security standards and we urge Congress to authorize the
    existing CFATS program. I look forward to your questions.
        [The prepared statement of Mr. Poorman follows:]

        Mr. Markey. Great. Thank you so much, Mr. Poorman.
        Again, we apologize. We will have to take a recess for--why
    don't we schedule about 15 minutes from now and then we will
    come back. I think it will be 15 minutes this time. The
    Committee stands in recess.
        [Recess.]
        Mr. Markey. Welcome back, everyone, and we apologize for
    having the United States House of Representatives meet
    simultaneously with this hearing. It is an unavoidable conflict
    that unfortunately is characteristic of my life in 33 years in
    the institution. It would be so much better if they would plan
    their lives around ours rather than the other way around but
    like so many other things in life, as William Shakespeare said,
    the will is infinite but the execution is confined. And so we
    are confined by these roll calls on the House Floor and we
    return here to complete the hearing with our gratitude to the
    witnesses and to everyone else, the remaindermen of history who
    are still sitting out in our audience and whatever C-SPAN
    audience we still have left for this vitally important issue.
    There is kind of a ``get a life'' quality to this hearing at
    this point for anyone who is still watching and we appreciate
    the attention which is being paid for whoever is out there in a
    non-somnolent state.
        So let us turn, let me recognize the ranking member, Mr.
    Upton, if he would like to ask his questions at this time.
        Mr. Upton. Well, thank you, Mr. Chairman. I do have a
    number of questions.
        First I would like to put a couple of letters into the
    record and ask unanimous consent that that happen.
        [The information appears at the conclusion of the hearing.]
        Mr. Markey. Without objection.
        Mr. Upton. I have a number of questions, and I talked to a
    number of members on the Homeland Security Committee during
    this last series of votes and I know that they have marked up
    their bill earlier this year, and I don't know if we have a
    date of when you are thinking about what the next step is, but
    the questions that I have do relate to the economic
    consideration of these facilities and I accept the statement
    that was made on the last panel. Mr. Durbin, in your read of
    this bill, what does this do to your membership? Do we see as
    some have suggested that a number of companies will pull up
    stakes and go someplace else? What is the economic impact as it
    relates to jobs? And certainly I want these jobs to stay here
    but what is your sense as you have talked to your members?
        Mr. Durbin. Well, Mr. Upton, let me take a step back first
    and let you know what our member companies have done to date,
    you know, because they really looked at the issue of security
    at their facilities as their responsibility and a cost of doing
    business and to date have already before having to implement
    under CFATS have invested $8 billion to----
        Mr. Upton. Billion?
        Mr. Durbin. Billion, to enhance security at their
    facilities, and we represent roughly 2,000 facilities around
    the country. So these are obviously investments that have
    already been made. We do expect that the CFATS program will
    require some additional investment. It is kind of hard to put a
    number on exactly what that will be. You know, DHS in some of
    their earlier testimony have estimated, you know, an additional
    $8 billion across the industry, across all of the regulated
    facilities to implement CFATS. But as far as what additional
    costs will come about through CFATS or through this bill,
    again, many of those investment decisions have been made, are
    being made and have been part of the plan. The extent to which
    additional requirements might add to that, I can't say that
    they won't. I think it certainly is going to--there will be
    more resources that will have to be put into further analysis
    and potentially further investments. But again, at this point
    there is no way of quantifying, here is what the cost will be
    or here is how many facilities will or will not, you know, end
    up having to make significant changes or consider not operating
    anymore.
        Mr. Upton. Now, Mr. Poorman, you ended your testimony
    talking about the citizen lawsuits and the potential for what
    is pretty secure information relating to the security of these
    facilities to be in fact opened up. Is that right?
        Mr. Poorman. Yes. The concern that we have is that the
    information that is put into DHS through their secure
    information systems would be leaked out and could get into the
    wrong hands and create situations that obviously would not be
    desirable.
        Mr. Upton. Is any of that information now available to
    folks, I mean in terms of security relating to any of these
    thousands of facilities that are out there? Is it pretty
    difficult to be able to obtain at this point?
        Mr. Poorman. Yes, it is, and it has been that way even
    since when we did other pieces of legislation and regulatory
    programs such as RMP. The Justice Department made sure that
    that information was protected as well because it does have a
    security aspect.
        Mr. Upton. Dr. Sivin, is the UAW or the Communication
    Workers taking a position as it relates to the release of
    information as to the secure aspects of those facilities? Do
    they have a position on that part of this bill?
        Mr. Sivin. If you mean facility-specific information such
    as that contained in security vulnerability assessments and
    site security plans, the only people we favor having access to
    that information are those employees and their representatives
    who participate in developing those plans. If you mean other
    types of government accountability information such as is a
    particular facility covered by the statute and the regulations,
    in a general sense is it in compliance, we believe that the
    public at large needs to have that kind of information in order
    to know that all responsible parties are doing their jobs.
        Mr. Upton. I know my time is expiring rapidly here but is
    it your sense that if this bill were to move forward ultimately
    to the President's desk, what impact would it have on your
    membership in terms of being able to continue to operate as
    they are doing now? Do you think that this in fact would
    provide as an incentive for companies to move someplace else
    outside of the United States borders?
        Mr. Sivin. Reading from the language of the bill, sir, it
    says that the Secretary of Homeland Security must show that
    implementation of methods to reduce the consequences of a
    terrorist attack would not significantly and demonstrably
    impair the ability of the owner or operator of the covered
    chemical facility to continue the business of the facility at
    its location. That is to say if a facility could show that it
    would have to move from Adrian, Michigan, to Toledo, Ohio, the
    Secretary of Homeland Security has no authority to require
    implementation and certainly if a facility could show that it
    would have to close its doors. Therefore, I expect zero impact
    on employment.
        Mr. Upton. Dr. Durbin, do you accept that?
        Mr. Durbin. Well, thank you for promoting me to doctor.
        Mr. Upton. Oh, I am sorry.
        Mr. Durbin. That is quite all right. I would just say that,
    you know, again, there are provisions in that bill that we
    continue to have concerns with that we think would be more
    difficult to operate and as I mentioned in my testimony about
    the civil lawsuits and the IST provisions. However, we are
    eager and anxious to continue working with the committee to
    make changes to the bill as it moves forward.
        Mr. Upton. Thank you. I yield back.
        Mr. Markey. Great. You didn't just call him Mr. Chairman by
    accident, did you? Because the fact that he can make you a
    phony doctor can't make him----
        Mr. Upton. Once the chairman, always the chairman. Isn't
    that what it is?
        Mr. Markey. Let me turn and recognize the gentleman from
    Texas, Mr. Green.
        Mr. Green. Thank you, Mr. Chairman, and I always heard when
    I was a State legislator, once a State senator, always a State
    senator, but I don't get called that in D.C. very much, only in
    Austin.
        Mr. Durbin, H.R. 2868, you mentioned in your testimony has
    civil suits for an uninjured party, and in my open statement
    you may have heard that I have some concern about that. Would
    you feel more comfortable if we actually limit it to someone
    who could show harm, whether it be an employee or a neighbor,
    similar or what current law is, you know, someone who had
    actually been harmed?
        Mr. Durbin. Well, I think that is certainly true that--I
    think one of the complications you have is being able to show
    harm under a security statute as opposed to environmental
    statute as we have discussed before, but certainly finding ways
    of limiting the applicability is going to improve that.
        Mr. Green. Well, and maybe you can comment because I am
    familiar with our public's right to know statutes that all my
    plants have their committees that they meet with and I don't
    have any problem with plants and people who live near the
    plants or work there knowing what is going on. I do have some
    problem with someone across the world or somewhere else who
    really shouldn't be interested in what is going on in a
    chemical plant or refinery in my district but the folks who
    live there because of the security issue. That is why I know
    the security issue is something--and we had to deal with that
    after 9/11 that we wanted, in fact we crafted legislation to
    show that someone living near there had that right but someone
    in a cave in Afghanistan looking on the Internet shouldn't have
    that capability, and so that is why hopefully we will be able
    to deal with that in this bill.
        I know sometimes IST is confused as a new concept but
    inherently safer technology has been around for many years and
    I know most businesses in production or manufacturing use that.
    Is the chemical industry opposed to legislation that requires
    companies to assess IST?
        Mr. Durbin. Well, again, I will only speak for ACC. I think
    because ACC members are already required to assess inherent
    safety in their own operations under the security code, under
    the Process Safety Code that existed prior to 9/11, and I would
    hasten to add that in the State of New Jersey they require
    consideration of IST. Our companies operate there as well. That
    program frankly has been very effective that ACC members would
    be comfortable with a requirement to consider because again, I
    would also say we think that the regulations as they are today,
    when you are trying to meet performance-based standards, you
    are going to have to consider all the options on the table.
        Mr. Green. Well, and I know New Jersey, the State does
    mandate--the State of New Jersey doesn't have where they can
    mandate the IST, they just can mandate the consideration.
        Mr. Durbin. Correct.
        Mr. Green. Dr. Sivin, in your testimony, several
    recommendations you believe on the importance to approve the
    legislation, particularly in the background checks. Can you
    elaborate on your suggestion the bill should codify statutory
    language that protects individuals who have fully equivalent
    federal background checks? And you heard my comments earlier.
    If I have a plant that, you know, is under Maritime and they
    have the TWIC card, transport worker identification card, and
    yet they have a plant that is not covered by that, would you
    feel comfortable with the TWIC card or that background check
    that the TWIC card should also stand in the place of what is
    now CFATS or this legislation?
        Mr. Sivin. Sir, that is precisely the kind of thing we were
    thinking. If someone has already undergone a background check
    and has a TWIC card and let us say they are transferred from
    the plant with the waterfront to the other plant, we think
    since they have already undergone a background check they
    shouldn't have to undergo another one under CFATS. That is
    exactly the kind of thing we were thinking of.
        Mr. Green. I would hope this legislation would give that
    guidance to Homeland Security because they are actually the
    same agency. I mean, Coast Guard obviously works with Homeland
    Security, and like I said, in our district in Houston after 9/
    11 if we didn't have Homeland Security partnering with us with
    the Port of Houston and our local law enforcement, federal
    enforcement and our refinery and chemical industry, we wouldn't
    be near as safe as we are today because there has been great
    cooperation in East Harris County on what we try to do, I mean
    obviously for the folks who live and work there.
        Mr. Ramaley, I have heard concerns from drinking water
    systems about unfunded mandates that arise from this bill. If
    the State regulatory agency directs a drinking water system to
    implement IST, do you feel the legislation provides enough
    assistance to water systems to defray the cost of any of the
    inherently safer technology requirements?
        Mr. Ramaley. I think you are asking me if I would consider
    the imposition of IST on water and wastewater utilities an
    unfunded mandate, and at this stage I am not aware of programs
    that would provide money to water utilities for making
    technology switches to accommodate chemical changes and things
    like that. So yes, it will have some impact, and I don't
    believe that there is adequate funding. I know there is not
    adequate funding to cover those costs at some of the Nation's
    largest drinking water utilities where those costs would be
    significant.
        Mr. Green. And I have shared this concern with a lot of
    other folks. You know, I have part of the city of Houston,
    which is a huge water supplier, but I also have very small
    water suppliers, some of my smaller communities, and the city
    of Houston may be able to do some of the things but some of my
    smaller suppliers can't do it because their tax base is not
    near as large as the city of Houston.
        In your testimony you mentioned the EPA should be the lead
    agency for chemical security on both drinking water and
    wastewater, and you know the two pieces before us today place
    drinking water systems under EPA and wastewater systems under
    DHS. How many facilities nationwide have joint drinking and
    wastewater systems and what kind of regulatory burden would
    arise if these facilities were shifted to two different
    security regimens?
        Mr. Ramaley. I can't give you a precise number but I can
    tell you that many municipalities around America operate both a
    water and the wastewater facilities. My guess would be tens of
    thousands.
        Mr. Green. And I know in my area everyone who has--you
    know, we may have a freshwater district that may not have
    wastewater but the municipalities all do it themselves.
        Mr. Ramaley. Many of the very large and countless small
    cities and towns have both water and wastewater operations.
    What was the second part of your question?
        Mr. Green. Well, what regulatory burden would arise with
    these facilities being subject to two different security
    regimens, you know, what EPA may require as compared to the
    Department of Homeland Security?
        Mr. Ramaley. In those situations where you have utilities,
    municipal utilities in particular, that are both responsible
    for both facilities, you would have to have staff trained in
    both sets of procedures. There are other complicating factors
    as well. For example, the Information Sharing and Analysis
    Center that both water and wastewater facilities depend on for
    security information would have to be up to speed in both the
    DHS and EPA requirements to provide that information because
    that is shared and accessed by both water and wastewater
    systems. So there are a number of complicating factors--
    personnel training, investments, different procedures. There
    are quite a few complications.
        Mr. Green. Mr. Chairman, I know you have been patient, and
    thank you.
        Mr. Markey. I thank the gentleman very much, and the Chair
    will recognize himself for some questions.
        And I will just begin by pointing out that on page 40 of
    the bill in dealing with the handling of sensitive information
    in judicial proceedings that on page 40 it says ``in a
    proceeding under this title, protected information described in
    subsection G or related vulnerability or security information
    shall be treated in any judicial or administrative action in a
    manner consistent with the treatment of sensitive security
    information under section 525 of the Department of Homeland
    Security Appropriations Act of 2007,'' in other words, those
    protections that in 2006 were put in by the Republican Congress
    and signed by George Bush. So the provision actually states
    that that should be the standard and I think that was a good
    standard that we agreed upon in a bipartisan fashion back then,
    and I just wanted to make sure that everyone understood that
    those safeguards will still be in place because there is a
    little bit of confusion on that.
        I would also add that we just talked about funds for
    implementing IST, and on page 36 of the legislation we
    authorized $125 million for the EPA to be able to ensure that
    there are grants to water systems to assist them with cost as
    well as more funds for other costs of compliance, so I just
    want to make sure that everyone understands that is also in the
    legislation.
        Mr. Ramaley.
        Mr. Ramaley. Yes, I would just comment, $125 million spread
    over the Nation's largest water and wastewater utility systems
    in my opinion would not go very far, but I appreciate that
    information.
        Mr. Markey. Well, you know, we have looked at the question.
    We think that can do the job. And so that is our perspective on
    it. But we can continue to talk about this in terms of what the
    proper funding is.
        As you know, I have been a longstanding advocate for the
    use of inherently safer technologies. I have spent the last 5
    years attempting to ensure that comprehensive chemical security
    legislation includes language that reduces the consequences of
    terrorist attacks by requiring facilities to switch to safer
    chemicals or processes when it is economically and
    technologically possible for them to do so, and I met many of
    you during my 6 years on the Homeland Security Committee making
    the amendments on IST and making the amendments on water safety
    and all of down the line so we have a long relationship at this
    point since 9/11 with my membership on the Homeland Security
    Committee. So I would like to thank all of you for being here
    and for your colleague, Judah Prero, for all of your work and
    efforts on trying to narrow differences and to come up with
    potential solutions, and I want to continue to work with you
    towards that goal.
        First of all, isn't it true that all ACC companies are
    required to assess already whether they could utilize safer
    chemicals or processes under your Responsible Care Code and
    that the American Chemical Council therefore is supportive of
    including that requirement in the legislation?
        Mr. Durbin. Mr. Chairman, first of all, let me also
    acknowledge what a great discussion we have had with your staff
    as well and I think we have been able to make some real
    progress trying to find some common ground but as I was saying
    to Mr. Green as well, yes, within the ACC security code, member
    companies do have to analyze inherent safety as they are doing
    vulnerability assessments and putting their plans together, and
    also in the State of New Jersey are operating under where they
    are required to consider IST and that program is considered to
    be working very effectively and the State of New Jersey I think
    will tell you the same. So yes, our membership at this point is
    comfortable with the idea of mandatory consideration of IST as
    we are already doing.
        Mr. Markey. Thank you. The Department of Homeland Security
    puts facilities into different risk-based tiers based on the
    type of risk the chemicals at the facilities pose. If the
    chemicals are highly toxic and the facility is located in a
    densely populated area, the facility would be tiered because an
    attack to cause the release of those chemicals might be the
    greatest risk. If the chemicals are highly toxic but the
    facility isn't located near any residential community, the
    facility would be tiered because a terrorist would be more
    likely to steal those chemicals and blow them up somewhere
    else. Do you think that we should be looking at the type of
    risk that facilities pose as we consider which facilities
    should be subject to authority to mandate the use of safer
    chemicals or processes, Mr. Durbin?
        Mr. Durbin. Yes, in general, ACC members would clearly say
    that risk should always be used to help determine the priority
    levels of which facilities should be taking which actions.
        Mr. Markey. Do you agree with that, Mr. Poorman?
        Mr. Poorman. Yes, we do agree with that.
        Mr. Markey. Dr. Sivin.
        Mr. Sivin. Yes.
        Mr. Markey. And Mr. Ramaley.
        Mr. Ramaley. Yes.
        Mr. Markey. Great. Thank you. So I think it makes a lot of
    sense to look at risk obviously, and that will help us then to
    obviously put different facilities in the correct tiers. Do you
    think that limiting the authority to mandate the use of safer
    chemicals or processes to the tier 1 and 2 facilities that have
    been deemed by DHS to pose a risk of a chemical release might
    be a more targeted way for Congress to proceed, Mr. Durbin?
        Mr. Durbin. Well, again, as the Administration has now made
    very clear that they are going to--you know, they have taken a
    position in favor of having some limited IST mandate on
    implementation, we certainly want to continue to be part of the
    discussion on how best to do that so yes, by limiting it in
    that way that would certainly be a more focused way of getting
    to that solution.
        Mr. Markey. And we want to work with you and all the other
    parties here to make sure that we accomplish that goal.
        During the Homeland Security Committee markup, an amendment
    was offered that would allow a facility to appeal to an
    administrative law judge if it felt that the Department of
    Homeland Security's initial IST determination was inaccurate.
    It seems to me that given the highly technical nature of the
    safer processes and chemicals involved that a more suitable
    appeal might be more scientific in nature. Would you like to
    talk about that, Mr. Durbin?
        Mr. Durbin. Certainly, and I think again, as our members
    look at this issue, as I said, we are very comfortable with the
    idea of mandatory consideration. Going further than that, one
    of the concerns that we have expressed with regard to the
    provisions in the bill was the lack of a robust appeals process
    if there were a determination. So by adding one, I think that
    is helpful and I would certainly agree that having folks who
    are technically proficient in the technologies available here
    and the chemical engineering and the process safety and health
    and what have you is going to be a more appropriate way of
    handling that.
        Mr. Markey. Thank you. I appreciate that. You know, I
    remember in my first year of college there were 200 of us in
    pre-law and then you had the 200 over there in theology and
    philosophy and then you had the 200 kids who were going to be
    doctors, so it was 200, 200, 200. And then they had organic
    chemistry freshman year for those future doctors and then
    sophomore year we had 300 people in pre-law, and then when the
    additional chemistry and other courses were given they kept
    building the number of lawyers, and while I am one of those
    people who became history and political science majors, our
    technical capacities are more limited, let us say, than those
    people who stayed the course. So I think it would be helpful
    for us to find a way to have scientific determinations be made
    even on appeal that reflect scientists making these evaluations
    so that we don't wind up having some court process where, with
    all due respect to myself and any others in this room that
    might be offended by my comments, making the determinations. So
    we thank you for that.
        I tell you what I am going to do. Let us give each 1 minute
    to summarize to us what you would like the committee to
    remember as we are moving forward on the creation of this
    legislation just so that we have got your kind of summary
    statements in our brain. So we will begin with you, Mr.
    Poorman.
        Mr. Poorman. Thank you once again for allowing us to be
    here today. Really, the summary would be that we really would
    like to see the CFATS program extended. A lot of good work has
    been done. We want to continue that good work. In regards to
    the IST issue, we want to just be cognizant of the myriad of
    programs that we are subject to. Our membership in particular,
    we have a lot of different chemical processes represented
    there, and when we make our material, we are making it under
    registration of different agencies, and if we are asked by DHS
    to discontinue the use of a chemical compound, it could have
    ripple effects that could reach out into even consumer safety
    where certain active ingredients for drugs won't be available.
    So we want you to keep that in mind, and also make sure that as
    you said, we agree that there needs to be really a technical
    review and we feel our people, our engineers, our chemists are
    best qualified to determine that per process.
        Mr. Sivin. In my summary I would like to point out again
    that the only thing that the bill authorizes the Department of
    Homeland Security to require implementation of is a facility's
    own plan. I cannot imagine that some of the examples we have
    heard today, a plan that would violate the FDA or a plan that
    would actually make the facility more dangerous would ever be
    in a facility's plan. I would like to reemphasize that we do
    not believe that the ability to mandate this because of the
    language that already exists in the bill is a threat to jobs. I
    also would like to emphasize that we are concerned about the
    background-check language in the bill and we do believe it
    needs to be improved to provide adequate protection against
    unfair adverse employment decisions. And finally, I want to
    emphasize that I think that certain parts of the employee
    participation need to be enhanced.
        Mr. Markey. Thank you, Doctor, very much.
        Mr. Durbin.
        Mr. Durbin. Thank you, Mr. Chairman. At its core I think
    ACC members firmly believe that the CFATS program that is in
    place now is a very solid foundation, a good program, and we
    want to make sure we can continue the success of that program
    and are committed to working constructively with you on finding
    areas that may need improvement. Again, with regard to the IST
    provisions in here, our members continue to have concerns about
    that but we are willing and eager to continue working with you
    and the Committee on those issues, and as I mentioned in my
    testimony, we as well continue to have concerns on the civil
    lawsuit provisions, but again, I think there is much more
    common ground here than there are differences to help us get to
    the objective of protecting these facilities.
        Mr. Markey. Thank you very much.
        And you have the final word, Mr. Ramaley.
        Mr. Ramaley. Yes. First of all, I appreciate the working
    relationship between AMWA and the Committee staff in developing
    the legislation. As you know AMWA supports 3258. A few points.
    We believe EPA should continue its oversight of the drinking
    water sector and our exemption from DHS's CFATS and IST
    programs must continue. We also believe that wastewater should
    be included under EPA as we testified. We think that security
    information resulting from vulnerability assessments and
    gathered information must be protected and must be strongly
    protected against public disclosure. We believe the bill now
    does that. And maintaining the current criminal penalties is
    important and we do look forward to working with EPA to
    formulate the appropriate standards for the sharing of that
    information as needed. Thank you.
        Mr. Markey. Thank you, Mr. Ramaley, and we thank each of
    you for working with the committee thus far and again we would
    like to keep a close working relationship with you and work
    with the minority as well on these issues. It has been 8 years
    since al-Qaeda attacked and obviously I am very sensitive to it
    because Mohamed Atta and the other nine were right there in
    Boston in my district preparing for that attack. And in 2000, I
    will be honest with you, Abdul Ghani Misqini, who was one of
    the millennium bombing plotters for the LAX, he came in from
    Algeria off of an LNG tank and just jumped off in Everett,
    Massachusetts, as did other al-Qaeda into the United States
    into my district, and that was an LNG facility that was
    unprotected. Now, they had a different plan and it involved the
    L.A. airport and thank God that they were apprehended before
    that happened but I am very sensitive to that huge LNG
    facility, to the port, to Boston, to what happened and to my
    constituents who were on those planes and who actually were
    working in New York City at the time. So it is something that I
    focused on very closely and why I asked the Speaker to put me
    on the Homeland Security Committee so I could make sure that we
    did in protections that nuclear weapons could not be put on
    ships that could then be detonated in the harbor of Boston but
    any harbor in the United States, that we screen for cargo on
    planes that we weren't screening. We were screening the shoes
    that people wore and the computers that they were putting
    through but not the cargo that went under their feet of
    passengers who weren't even on the plane, and chemical security
    into this as does water security. We know they are out there.
    We know they want to hit. We know that they would in fact
    implement their plan if somehow or other they could get through
    our outer security perimeters overseas and here, and so we must
    balance because the impact, for example, just on Boston alone
    of that successful attack was, we had a 27 percent reduction in
    air travel out of Boston for 3 or 4 years. That kills jobs.
    That kills the economy. That alters people's lives so they
    cannot be successful. So we have to find a formula here that
    works. And by the way, airports across the country might have
    gone down an average of 10 percent just as a derivative of what
    happened in Boston and in New York City and down here in
    Washington on September 11. But all of it was profound in terms
    of its economic impact.
        So we have to make sure that they are not allowed to
    successfully implement a terrorist attack because that is what
    terror does. It scares people. They don't fly, they don't move,
    they don't buy things, and everyone suffers as a result. And we
    know that chemical facilities are on their list. We just have
    enough security information to be well aware that they are very
    near the very top of the al-Qaeda terrorist target list. And so
    our responsibilities are great, and we must make sure that
    especially in urban areas where these chemical facilities,
    where these water facilities might be located, you know, if we
    could all do it again we would not put them right there in the
    middle of downtown Boston right on the harbor and other cities
    across the United States. We would make those beaches or
    waterfront parks if we could do it all over again, but we
    didn't do it that way. They are there. They are in densely
    populated areas. We have to deal with it realistically, try to
    put together a formula that works, doesn't hurt industry and
    comes up with something that does protect the American people.
    That is our goal.
        We very much enjoyed working with all of you so far and we
    look forward to the relationship. With that, this hearing is
    adjourned. Thank you.
        [Whereupon, at 2:00 p.m., the Subcommittee was adjourned.]
        [Material submitted for inclusion in the record follows:]